Legislature(1995 - 1996)
04/26/1995 01:37 PM House TRA
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE TRANSPORTATION STANDING COMMITTEE
April 26, 1995
1:37 p.m.
MEMBERS PRESENT
Representative Gary Davis, Chairman
Representative Bill Williams
Representative Tom Brice
Representative Jeannette James
MEMBERS ABSENT
Representative Beverly Masek, Vice Chairman
Representative Jerry Sanders
Representative Eileen MacLean
COMMITTEE CALENDAR
HB 218: "An Act relating to the payment of certain trucking
owner-operators."
HEARD AND HELD
* HB 133: "An Act relating to the Alaska transportation system
and local review of public projects."
HEARD AND HELD
(* First public hearing)
WITNESS REGISTER
REPRESENTATIVE JEANNETTE JAMES
Alaska State Legislature
State Capitol, Room 102
Juneau, Alaska 99801
Telephone: (907) 465-4843
POSITION STATEMENT: Prime sponsor of CSHB 218
RICHARD STRAHL, President
Alaska Independent Truckers Association
2951 Westwind Court
Anchorage, Alaska 99516
Telephone: (907) 345-7081
POSITION STATEMENT: Supported CSHB 218
BOB EAKMAN, General Manager
Alaska Independent Truckers Association
1443 West Northern Lights
Anchorage, Alaska 99503
Telephone: (907) 276-1934
POSITION STATEMENT: Supported CSHB 218
FRANK DILLON, Executive Director
Alaska Trucking Association
3443 Minnesota Drive
Anchorage, Alaska 99503
Telephone: (907) 276-1149
POSITION STATEMENT: Opposed CSHB 218
KAREN CHASSE
2641 Lyvona Lane
Anchorage, Alaska 99502
Telephone: (907) 243-7080
POSITION STATEMENT: Supported CSHB 218
KATHRYN THOMAS
P.O. Box 3005
Kenai, Alaska 99611
Telephone: (907) 776-5515
POSITION STATEMENT: Testified on CSHB 218
BILL EVANS
Eagle Equipment
P.O. Box 870076
Wasilla, Alaska 99687
Telephone: (907) 745-1942
POSITION STATEMENT: Testified on CSHB 218
REPRESENTATIVE KAY BROWN
Alaska State Legislature
State Capitol, Room 517
Juneau, Alaska 99801
Telephone: (907) 465-4998
POSITION STATEMENT: Prime Sponsor of SSHB 133
PEGGY MULLEN, Member
City Council of Soldotna
355 Lingenberry Avenue
Soldotna, Alaska 99669
Telephone: (907) 262-9225
POSITION STATEMENT: Supported SSHB 133
JOHN ISAACS, Member
Alaska Chapter, American Planning Association
308 G Street, Number 313
Anchorage, Alaska 99501
Telephone: (907) 274-9319
POSITION STATEMENT: Supported SSHB 133
CHERYL RICHARDSON, Member
Alaska Citizens Transportation Coalition
519 West 8th Avenue
Anchorage, Alaska 99501
Telephone: (907) 274-3621
POSITION STATEMENT: Supported SSHB 133
KEVIN RITCHIE, Executive Director
Alaska Municipal League
213 Second Street, Suite 200
Juneau, Alaska 99801
Telephone: (907) 586-1325
POSITION STATEMENT: Supported SSHB 133
BO BROWNFIELD, Deputy Commissioner
Department of Transportation & Public Facilities
3132 Channel Drive
Juneau, Alaska 99801-7898
Telephone: (907) 465-6973
POSITION STATEMENT: Supported SSHB 133 with concern
NANCY WEBB, Planning Consultant
469 Panorama Drive
Fairbanks, Alaska 99712
Telephone: (907) 457-2032
POSITION STATEMENT: Supported SSHB 133
GARY MOORE, Director
Planning and Development
Tanana Chiefs Conference
122 First Avenue
Fairbanks, Alaska 99701
Telephone: (907) 452-8251
POSITION STATEMENT: Supported SSHB 133
WALTER PARKER
3724 Campbell Airstrip
Anchorage, Alaska 99504
Telephone (907) 333-5189
POSITION STATEMENT: Supported SSHB 133
PREVIOUS ACTION
BILL: HB 218
SHORT TITLE: PROMPT PAYMENT OF TRUCKING SUBCONTRACTORS
SPONSOR(S): REPRESENTATIVE(S) JAMES BY REQUEST
JRN-DATE JRN-PG ACTION
03/01/95 531 (H) READ THE FIRST TIME - REFERRAL(S)
03/01/95 531 (H) STATE AFFAIRS, TRANSPORTATION,
JUDICIARY
03/07/95 (H) STA AT 08:00 AM CAPITOL 102
03/07/95 (H) MINUTE(STA)
03/23/95 (H) STA AT 08:00 AM CAPITOL 102
04/06/95 (H) STA AT 08:00 AM CAPITOL 102
04/06/95 (H) MINUTE(STA)
04/13/95 (H) STA AT 08:00 AM CAPITOL 102
04/13/95 (H) MINUTE(STA)
04/18/95 1345 (H) STA RPT CS(STA) NEW TITLE
1DP 4NR 1AM
04/18/95 1345 (H) DP: JAMES
04/18/95 1345 (H) NR: PORTER, GREEN, ROBINSON, WILLIS
04/18/95 1345 (H) AM: OGAN
04/18/95 1345 (H) ZERO FISCAL NOTE (DOT)
04/18/95 1345 (H) REFERRED TO TRANSPORTATION
04/26/95 (H) TRA AT 01:00 PM CAPITOL 17
BILL: HB 133
SHORT TITLE: TRANSPORTATION PLANNING
SPONSOR(S): REPRESENTATIVE(S) BROWN
JRN-DATE JRN-PG ACTION
01/27/95 158 (H) READ THE FIRST TIME - REFERRAL(S)
01/27/95 158 (H) TRA, STA, FIN
03/17/95 777 (H) SPONSOR SUBSTITUTE INTRODUCED
-REFERRALS
03/17/95 777 (H) READ THE FIRST TIME - REFERRAL(S)
03/17/95 777 (H) TRANSPORTATION,STATE AFFAIRS,FINANCE
04/26/95 (H) TRA AT 01:00 PM CAPITOL 17
ACTION NARRATIVE
TAPE 95-17, SIDE A
Number 000
The House Transportation Committee was called to order by Chairman
Gary Davis at 1:37 p.m. Members present at the call to order were
Representatives Davis, James, Williams and Brice. Members absent
were Representatives MacLean, Sanders and Masek.
CHAIRMAN GARY DAVIS announced the agenda was to hear testimony on
Committee Substitute for HB 218 and Sponsor Substitute for HB 133.
He stated it was his intent that neither bill would leave the House
Transportation Committee today. He said it was highly unlikely
that these pieces of legislation would move through the
legislature. He felt the Transportation Committee is the place to
work on them during the interim. He said he will take testimony,
discussion and debate as well as discuss any amendments.
HB 218 - PROMPT PAYMENT OF TRUCKING SUBCONTRACTORS
Number 028
CHAIRMAN DAVIS asked Representative James to give her testimony on
CSHB 218.
REPRESENTATIVE JEANNETTE JAMES, Sponsor of Committee Substitute for
HB 218 agreed with Chairman Davis on the fact CSHB 218 cannot be
completed this session and the Transportation Committee is the
place where it should reside during the interim. She stated this
bill was filed upon the request of the Alaska Independent Truckers
Association to provide for their prompt payment. She explained
recent experiences with brokers as subcontractors has caused great
distress due to an inability of the truckers to receive prompt
payment. Representative James said this is not only an economic
issue, but a safety issue as well. To solve the problems
experienced, several things must take place. The truckers must
organize their own contract and billing system, which they are
doing to support their claim for statute change. Subcontractors
currently have statute support for prompt pay. She indicated that
the employees are covered by labor laws but this statute support
does not include the owner-operators of trucks.
REPRESENTATIVE JAMES indicated that the independent truck owners
who hire out themselves and their trucks for construction and other
short term jobs, need to be able to depend on prompt payment for
their services in order to maintain their trucks and to guarantee
safe operations on the highways and roads. This legislation is
specific to trucking, owner-operator as defined in Section 2, (d),
(6) of the bill and does not extend to any other segment of small
businesses. The truckers are instituting a system of semi-monthly
billings. This legislation would make those billings payable
within 14 days which is a reasonable length of time.
Representative James asked to quote former Representative Ron
Larson, who said "some of my friends tell me this and some of my
friends tell me that, then I agree with all my friends." She
explained this has been one of those bills that has been somewhat
of a separation between some of her friends, because she generally
supports trucking as not only a way of life, but as an important
part of our economic activity. She said her husband had done a lot
of trucking before they came to Alaska. He now drives a school
bus. He has a brother that has been in the trucking business most
of his life. She stated her point was that she has been exposed to
the trucking industry for many years. She said the problem with
independent truckers regarding these issues is not an independent
truckers problem as much as a problem with the category called
brokers. Representative James indicated she was not saying we
should not have brokers, but there should be responsible brokers.
She explained they fill a need in the construction industry when
there are extra trucks needed. A broker shows up and hires the
individual trucker to perform an overall trucking responsibility.
The subcontractors, in statute, are given a prompt pay and are
supposed to be paid in seven days after the prime contractor
receives payment. The laborers working on a certified payroll,
such as state jobs, must be paid and there are certain guarantees
to this. She indicated there was nothing in statute to owner-
operators of trucks. They cannot be treated as labor because they
are not labor; they have their own truck and cannot be
subcontractors because they are not part of the bidding process.
By putting some provisions in statute for the owner-operators of
trucks, it gives them some clout. She commented that payment to
these truckers such as long haul truckers is generally twice a
month. She added the truckers she has talked with would be happy
to be paid once a month, but 120 days is too long of a time period
to go without payment. There is a division between the long haul
truckers and the Alaska Independent truckers. She said she felt
bad about this and felt there should be no distinction. She
supported the idea of working on this issue during the interim and
would be happy to listen to any other solutions. She said the
bottom line is that we cannot have people driving on the highways
and roads, hauling material such as gravel and not being able to
get paid. They need to be paid so they are able to keep up the
maintenance required on their trucks. She added the truckers who
are in the larger businesses might feel if the smaller truckers
don't have enough money to be in business, they should not be in
business. She said "these truckers got to where they are because
there aren't jobs." The reason they have this is because there was
not enough labor to be performed by truckers, so they are trying to
create their own jobs. She said providing HB 218 for the public
and legislative process is an excellent way to bring the problem to
the forefront. She said she would be happy to answer any
questions.
CHAIRMAN DAVIS announced there were a number of people on
teleconference and asked for testimony from Robert Eakman from
Anchorage.
ROBERT EAKMAN asked if Mr. Richard Strahl could testify first.
CHAIRMAN DAVIS said, yes.
RICHARD STRAHL, President, Alaska Independent Truckers Association
stated he has been a trucker in Alaska for 34 years. He supported
HB 218. He indicated at the present time they are not in the
contract and need this bill and need to be recognized. He made
reference to the fact if they work for a broker, they only work
directly for a general contractor they need to be recognized as a
entity in the contract which would give them a right to ask a
broker (indisc.), to ask the general contractor, the Department of
Transportation & Public Facilities (DOT/PF) and an engineer out on
the site and have to ask where their money is. He was pleased with
the billing part and stated it was good for everyone to have their
own billing (indisc.). This entitles us to attempt to go through
the system to get our money when working for a general contractor
or through a broker for a 30-day period and have not received
payment. He expressed concern for expedient ways of collecting
their money and the fact that the general contractor or the broker
will not be around at the time the job is over or if there is the
situation where the general contractor is losing money, or the
broker is taking that money and using it in other areas for other
trucking activities. At the present time, they don't have the
opportunity to go to the broker, to the general, or the DOT/PF and
find out where the money is passed through, or if it is passed
through. The general (indisc.) is to stay out there in your truck
for 60-90 days. He remarked it is a scary situation when your
truck (indisc.) and someone goes out of business or leaves town and
you are left without payment. He made reference to the comment
made earlier regarding smaller businesses being able to financially
handle themselves. He stated as an individual and a one truck
owner-operator or for an owner-operator with a couple of trucks,
most everyone's credit is set up on a 30-day situation; that is for
fuel, tools and maintenance repairs. He said they need this money
in order to pay these people promptly. He said people are very
quick at cutting off credit with individual truckers compared to a
large general contractor or company. On the job if a person is
burning $80 to $90 worth of fuel a day, that means their running a
lot, there is a lot of wear on tires, and there are other expenses.
He emphasized the need for getting the money where the truckers can
pay and keep their credit in force. Currently, there are a lot of
general contractors that will pay promptly and have been doing so
for years but do not always get the contracts. Through the bidding
system they may not get any work this year. If they do, there are
only so many people that can work for them. He said so you end up
with some of the other contractors who seem reliable enough and pay
their bills and gave the contract to a broker because they had
hoped to (indisc.) their own costs. He said they can do their job
and promise to pay his own truckers and carry out his part of the
contract. Where the system falls down is not following through to
the independent broker and in many instances (indisc.) without his
money for long periods of time. He felt HB 218 would help to close
that gap and give people a normal period of time to pay their
bills.
Number 239
CHAIRMAN DAVIS asked Mr. Strahl to explain the involvement of the
broker. He asked for confirmation that a general contractor gets
a job and has the independent trucking agency submit estimates and
quotes to work that particular job.
MR. STRAHL explained from his experience, usually the general
contractor is required to bid on a highway job, an inspector will
be required to come on site, there will be a certain amount of
yardage to be moved, so much asphalt they want and the brokers will
give the general contractors bids on doing this work, either by an
hour or by a tonnage rate. If this works for the general
contractor and he's successful in getting the job and he hires that
broker, they already have a set price. At that time, the general
contractor knows what price he can do the trucking for because he
has a price on it. If it is a reliable broker, he will be able to
supply the amount and types of trucks needed to do his job. Some
of the advantages, from the general contractors standpoint, as far
as getting the right trucks and the amount of trucks, when they are
needed, are that you know the price going into the job and that it
won't change.
Number 277
CHAIRMAN DAVIS asked for confirmation that of all the trucking
operations on that job that the broker has submitted, does the
general contractor pay the broker?
MR. STRAHL said yes (indisc.) contractor with the general
contractor the broker (indisc.) the type of materials, if the
contract calls for D-1 gravel and the asphalt and the borrow A and
borrow B. It would be stated in the contract. Also, the broker is
a subcontractor at that time.
CHAIRMAN DAVIS asked how the independent truckers are licensed?
MR. STRAHL said an independent trucker at that time (indisc.)
signed the contract with the general contractor with 10 different
trucks, the broker will call 10 of his people and say 10 of his
independent owner-operators have turned in paperwork to him, he
will call them and ask them to work on a job. He will dispatch
them according to the general contractors needs at that time.
CHAIRMAN DAVIS asked again what kind of license was needed by an
independent trucker. He made reference to it being a business
license, but under what SIC code. The trucker is not considered a
subcontractor from his understanding.
BOB EAKMAN, General Manager, Alaska Independent Truckers
Association of Anchorage, interjected and said no he is not a
subcontractor. There are two separate codes that use (indisc.)
license and one other. He stated he did not have the codes in
front of him.
CHAIRMAN DAVIS asked Mr. Eakman for his testimony
Number 292
BOB EAKMAN, General Manager, Alaska Independent Truckers
Association of Anchorage, stated the two most important issues this
bill addresses is the recognition and safety which were detailed
out in a letter dated April 20, 1995, to Chairman Davis. If the
truckers are not paid in a reliable and timely manner, they do not
have the necessary means of maintaining their trucks, except to dig
into their savings if they have any, or talking someone into giving
them credit for 90 to 120 days. He reiterated his comments on
safety being one of the biggest factors. The other part of this
bill is it provides the truckers with a law to go in other
directions, where they do not have that now. Currently, the
majority of the work is done on a verbal contract basis. He said
it was not uncommon to receive late night phone calls or calls
while they are in their trucks. He then stated it is not practical
for the trucker to sign a contract every time he has to haul a
load. Half the time the state does not know what the jobs are
going to be until their let. He said there was no real way for a
contract to be signed between a broker and an independent
owner-operator for every job for the entire year. He said it was
just not practical. He added the fact that the subcontractor or
broker did not get his paperwork turned in on time, should not have
any bearing on whether the trucker is paid or not.
Number 340
FRANK DILLON, Executive Director of the Alaska Trucking
Association, explained the association is opposed to HB 218. He
stated they represent both long and short haul truckers. They
represent all kinds of truckers from all areas of the state from
Annette all the way to Barrow and from Dutch Harbor to Tok. They
have members who operate one truck and members who operate more
than 100 trucks. He stated they have discussed this issue and are
in favor of having people pay promptly for their trucking services
in a timely manner.
MR. DILLON remarked what has brought this bill forward is,
understandable frustration about the length of time that it takes
to receive payment. He stated dump trucking in Alaska is not what
it used to be; the world has changed and as with any evolution
those that can adapt, survive and those that don't, go extinct.
Not many construction truck owner-operators are able to survive any
more just operating their truck during Alaska's short trucking
season. Virtually every owner-operator must have other sources of
income such as a working spouse, outside winter work, snow hauling
for about half the rate in the winter through the municipalities or
some other way to make a full-time living and to be able to provide
for a modest family income. Because market forces of supply and
demand would have underwritten and changed the way the market takes
place, he did not see where any of the proposals that have been
brought forward so far are going to change the situation as it
exists.
MR. DILLON continued to explain what is really hurting the
independent truckers in this state are the independent truckers
themselves. He said he would illustrate this point by using the
analogy that the trucking industry is like bookends. On one end,
you have people who do what he refers to as hobby trucking. These
are truckers who are basically financially secure, in their late
40s or 50s, have decided they want to go into the trucking business
because they have always wanted to give it a try for the sense of
freedom or exhilaration of operating a truck. The hard work and
just the idea of having to make a living at it are not necessarily
considerations because as they have indicated to him they don't
really need the income from the trucking business. He then made
reference to the other bookend where there is a group of people who
are usually younger, 23 to 26, and are not concerned about the big
picture and the long term. They have older, used trucks and lend
themselves out to work. If they are making what they consider a
reasonable rate, this is fine. He said this appears to be more of
a temporary employment scheme than a career.
MR. DILLON continued that in between these two bookends there are
a lot of people who are truly trying to make a living operating a
construction truck in the state of Alaska. It is difficult because
of an oversupply of trucks and because of the shrinking budget. He
then stated the specifics of the bill. First, he understands the
need to be paid before services rendered in a timely manner. This
is not a problem that exists in only the owner-operator level of
the trucking industry. It is unusual for any truck service
provider to be paid in less than 45 days. The normal amount of
time is about 45 to 50 days. There are existing contracts within
this state with major oil companies that provide for trucking
payments to be made within 90 days. These are on amounts of money
in the millions of dollars and for trucking services provided in
the millions of dollars worth of revenue a year. The idea of being
promptly paid is not solely a problem for the owner-operator. If
someone doesn't pay the trucker for the services, some of the
remedies are they are re-billed, send a letter of reminder, turn
the issue over to a collection agency or litigate the circumstances
to try and recover the money.
MR. DILLON said if HB 218 passes, those remedies would still exist
for a owner-operator trucker who has not been paid. Even though
there is talk about force of law he said what escapes him is, in
terms of statutory adjudication of litigation or action going out
to collect the money, how HB 218 helps. It only applies on state
funded jobs which may be the majority of the aggregate and dirt
hauling in the state, but it is not all of it. There is a lot of
private sector jobs that this would not address. HB 218 also
excludes people who have the Interstate Commerce Commission (ICC)
authority from the ability to take advantage, if there is an
advantage in this bill. He asked to make a correction on the issue
of what has been said regarding ICC carriers already having a
prompt pay bill that requires them to be paid in a specific amount
of time. He said this statement is not true. The ICC requires
that the trucking company that provides the service send the bill
to the shipper within seven days of providing that service. It is
an obligation that is placed on the trucker to bill. No where is
it stated that the shipper has to pay that bill in any specific
amount of time. That is a misconception that is widely held with
people who have not worked for the ICC. He stated HB 218 uses the
language regarding oral contract sales. He stated as far as he was
concerned this may be legal, but it is impossible to prove without
going to court. He said when it is your word against someone
else's, it is rarely arbitrated. He said it has been suggested
from the Alaska Trucking Association (ATA) for years that there be
hauling agreements to be signed at the time the person goes to
work, even if it is just something that has to be carried by the
driver of the truck. He indicated this would mean people would
have to change their business to a certain degree but it would be
a positive change. He reiterated his opposition to CSHB 218
because it does not provide any revenue. He said what they would
like to do is get together with all involved players in the interim
and figure out if there is a way to improve the situation for the
owner-operator independent truckers. Mr. Dillon said he was
available for questions.
Number 433
REPRESENTATIVE JEANNETTE JAMES said she appreciated Mr. Dillon's
offer to work on this through the interim session.
KAREN CHASSE stated she supported CSHB 218. Her husband has been
a trucker in Alaska for over 23 years and owns and operates a
trucking business. She said they have always run their trucks as
a business. She stated trucking is their livelihood and is their
only source of income, supporting them and their two children.
They pay taxes and carry a million dollar insurance policy. They
have their own invoices with daily contract terms written on them
which are signed everyday by the job foreman. She explained if
they have 10 jobs a day, then they would write up 10 separate
tickets for each job they are dispatched to. She bills everyone
and hand carries the statement along with the ticketed invoices to
the contractor's office on the first day of every month. She noted
even after doing all this, they do not get paid any faster than the
truckers that do not bill. Charging by contract does not work with
these contractors and brokers. They still pay when they feel like
it and not a moment sooner.
MS. CHASSE said they were not present today to ask for any special
favors or request any state money or grants. Their only request is
that they are paid in a timely manner by the contractors and the
truck brokers. She added she did not understand how anyone can be
in opposition to this bill. If they are, is it because the
contractors don't have any intentions of paying their bills. Or do
they need to use the truckers' money to run their own business?
She questioned if this is because they have bid too low on one job
and have to use other funds until they can bid on another one. She
said if anyone opposes this bill, what exactly are they opposing.
They seem to be opposing the fact they will be getting paid.
Truckers work for different contractors and brokers all the time;
sometimes changing job sites two or three times a day. They simply
go where they are needed when a contractor or broker calls for more
trucks. The contractors have been taking advantage of the
owner-operator for years; they have been controlled for so long
that most of the truckers are afraid to ask for their money for
fear of being blackballed. The truck brokers are too scared to ask
for the money for the same reasons. If the broker puts pressure on
the prime to get paid, then the prime will just call a different
broker. She said she knows how it feels to be blackballed because
it happened to her simply because she asked for her money. She
said she waited four months to get paid, she called the (indisc.)
and went over the broker's head. She was then called into the
office the next day and was blackballed by that contractor and was
never allowed to work on that job again simply because she asked
for her money. She said the system works on fear and intimidation.
MS. CHASSE said some of us are tired of living this way. She said
she needs a steady cash flow to run their trucks and pay
commission, as well as money to pay their insurance, fuel and other
personal bills. She said she needs a regular income to care for
their children. She indicated three people have died in the last
two years due to unsafe equipment. Someone was killed by a truck
that had no brakes. A fellow trucker was killed because his truck
was literally held together with chains. When the chain broke, his
load shifted and came through the back of the cab. She said she
can only guess that these truckers just did not have the money to
fix their own trucks.
MS. CHASSE said it took a lot of courage to testify on this
particular issue. Some other people said they would have liked to
testify on this issue but they have been threatened by some of the
brokers. One guy told her that his broker said even if this bill
passes, they still won't pay him any faster and if he doesn't like
it, then that's too bad. It is a pretty bad situation when so many
owner-operators are scared of being blackballed that they will run
unsafe equipment on the road and apply for welfare before running
the risk of speaking out on this issue. She asked for the
committee's help. All other subcontractors that work for the prime
are covered in certain spec books that clearly outlines all aspects
of the particular jobs. It also specifies when a prime must pay
each one of these people. Independent truckers and owner-operators
have never been recognized in the spec books and the only way this
loophole can be stopped, is by passage of this bill. She then
asked for questions.
Number 490
CHAIRMAN DAVIS stated he wanted to take testimony from Soldotna
next.
CATHERINE THOMAS of Kenai expressed concerns for the fact that a
lot of the expense is coming down to the public in the end
(indisc.) increase the cost of every project. She said she did not
understand why this was such a problem. Her business history is as
a long haul trucking company, (indisc.) owner-operator, truck
broker and construction company that hires independent operators
and truck brokers. She explained state or federal contracts have
always been tied to the contract that she has with the government.
Those are issued down to the subcontractor. Normal procedures
nowadays with that particular contract with the subcontractor is
tied back to the state pay schedule and the government contract or
prime contract. Once payment is received they are required to pay
within five to seven days. If the owner-operator independent
truckers negotiate with their brokers to have the same guidelines
or same type of subcontract privileges, this scenario is
eliminated. They have every right under the Public Information Act
or Freedom of Information Act to request to see a copy of the
contract indicating when the pay schedule has been issued. She
stated normally the subcontractor and the contractor require
release of liens for moneys received. This is normally done pay
schedule by pay schedule. The only thing that she sees happening
with CSHB 218 if it passes is it removes more responsibility from
an independent operator to ensure that his contractor is providing
him with the same contract requirements that the prime has. If the
prime contractor or the broker for the independent trucker borrows
money from the bank to pay the independent trucker, that cost of
money will be passed on back to the state government and will
increase the price of these projects. Most of their contracts are
paid within 30 days. She asked if there were any questions.
Number 532
REPRESENTATIVE JAMES asked if Ms. Thomas worked mostly as a prime
contractor or a subcontractor?
MS. THOMAS stated she worked as both.
REPRESENTATIVE JAMES asked for confirmation that she hires
independent owner-operators, and acts as a broker. In other words,
if there is a need for more owner-operators she would call them in
for that particular job.
MS. THOMAS reiterated her comments in working both areas because of
her status as a women in the business, sometimes she has taken the
trucking portion of the contract. She said she would consider
herself a truck broker.
REPRESENTATIVE JAMES asked what type of arrangement does she have
with the operator-truckers for payment.
MS. THOMAS explained that she requires a copy of the prime contract
that her prime contractor has with the state. She ties her terms
of condition to that contract, if they process her pay estimate and
have a check in her hand within five to seven days after they have
received their money. She also can request in that contract that
they notify her when they have received that check. Her
subcontract to her owner-operators -- and she issues them
subcontracts and it's tied right back to that and they have a right
to look at any of those contract documents as far as she was
concerned.
REPRESENTATIVE JAMES stated Ms. Thomas made mention of having to do
a lien release when, for example, the prime contractor is paying
the subcontractor. Representative James asked if it stated
anywhere that the subcontractor has paid their bills.
MS. THOMAS said under the certified payroll Davis Bacon Act, the
forms that go in on every public project such as the Title 36
project, they are required to furnish the state Department of Labor
with a list of anyone that they would have a contract with on that
particular project.
REPRESENTATIVE JAMES asked if Ms. Thomas includes owner-operators
of trucks on that certified payroll.
MS. THOMAS said yes, she does. Her prime contractor requires a
lien release from each of her independent truckers saying they have
been paid for a portion of the project and a copy of the Title 36
certified payroll form, that she is required to provide the state
with.
Number 566
CHAIRMAN DAVIS said he would now take testimony from Anchorage
again.
BILL EVANS, Eagle Equipment in Wasilla, stated he has been trucking
in Alaska for years. He said it was not just a money issue
anymore, but a safety issue as well. He said there have been
people that have been killed. He commented that the sad part is
who is going to be next. He asked if it would be a load of school
bus kids or someone's family member. He said they can't get their
money and can't fix their equipment. He stated they have tried to
go up the ladder and ask the people they work for where their money
is. But they won't even talk with them, because they didn't hire
them. He commented that a few weeks ago he just got his money from
a person he worked for last July. He said when he has to pay his
insurance every month, his fuel bill, his tires every month, and
everything else, it is on a 30-day payment schedule and he can't
survive on those kinds of conditions. He said something has to be
done for the independent operator to get their money so the trucks
can be properly maintained. He said it boils down to a life or
death situation regardless of the chain of command and they are not
getting their money. It is a real safety issue. He noted he has
equipment that he is unable to put on the highway because he has
not been able to get his money to maintain his truck. He added
anyone who opposes this bill does not understand the safety issues
involved.
Number 596
CHAIRMAN DAVIS asked Mr. Evans if the payment he received was from
a contractor or a broker?
MR. EVANS said it was from a broker.
CHAIRMAN DAVIS took testimony from Ms. Chasse again from Anchorage.
MS. CHASSE said she was speaking with Mike Miller before he left
and he's a general contractor and he told her the way it works is
they bill on the first and the fifteenth of the month. It takes
them approximately 6 to 20 days tops to get paid. It then takes
seven days before they can issue a check to the broker. The
maximum time to receive a check is 27 days. She said she did not
understand why they were not getting paid if this is the normal
procedure.
REPRESENTATIVE JAMES asked if Ms. Thomas was still on line in
Soldotna. She stated that Ms. Thomas indicated in her testimony
that people who work for a subcontractor or a prime contractor have
the privilege of seeing the contract that they are working under.
She asked if these independent operator trucks, such as Mr. Evans,
would be able to get a copy of the contract of the person he is
working for?
MS. THOMAS stated the prime contract with the city, state or the
federal government will dictate whether it is a 2 week billing or
a 30-day billing. When the trucker signs a contract with the truck
broker or the prime contractor, that can be a term he negotiates
for. The state or the municipality issuing the prime contract is
required to provide a copy of the contract. In between the
subcontract there may be a term of negotiation, she corrected
herself and said the ability to see it may be a term of
negotiation, but many prime contracts will require that all the
subcontracts become part of the privileged information that the
municipality can provide.
Number 620
CHAIRMAN DAVIS said he would hold HB 218 through the interim in
order to work on several aspects of the bill with the involved
parties such as Richard Strahl, Robert Eakman, Frank Dillon and Ms.
Thomas. He said he didn't think that people would not be
sympathetic to the fact that someone is not receiving payment in a
timely manner. He felt everyone agrees that independent truckers
or anyone, for that matter, needs as well as should, receive
payment in a timely manner. He asked for people in attendance to
consider an option or way of getting independent truckers
designated or licensed as subcontractors so they would fall under
existing statute which might be a possibility with some additional
language included in the bill. He also referred to Ms. Chasse's
comment of why would anyone not favor this bill. He explained
incorporating something into law, specifically to a small group is
a pretty big step. If there is opportunity for alternative methods
to get a problem taken care of, he would like to approach it from
that angle through the interim.
TAPE 95-17, SIDE B
Number 000
REPRESENTATIVE JAMES said she had been talking with Mr. Dillon on
various solutions of truck safety. She felt if we are going to be
working on how these people get paid, then we also should address
some kind of provision for safe trucks on the roads. She said we
are saying now that the safe trucks that are not there because the
owner-operators are not getting paid and she wanted to know that
they are going to be there even when they do get paid. She agreed
with it being a safety issue. She said we could let these people
economically go and find another job, if our concerns, as a state,
were just to be sure they received payment, but the issue of safety
must be addressed as well.
CHAIRMAN DAVIS stated HB 218 will be held for the interim.
HB 133-TRANSPORTATION PLANNING
Number 042
CHAIRMAN DAVIS asked Representative Kay Brown if she would give her
testimony on HB 133.
REPRESENTATIVE KAY BROWN, Sponsor, stated she has been concerned
for a number of years with the transportation planning process.
She felt the transportation planning process should fully embrace
the positive changes made at the federal level which gives greater
flexibility than previously. She indicated we should be striving
to have a "bottom up planning process" that involves individuals in
the community, rather than having plans dictated from the top and
from the Department of Transportation & Public Facilities (DOT/PF).
There are a number of specific concerns that have arisen regarding
particular projects. She said she would not go into them in detail
now and only mentioned them as background information. It was the
real life situations and problems in the community of Anchorage
that lead her to work with Cheryl Richardson and the statewide
group she is affiliated with. This group was designed to help
improve the transportation planning process. This legislation
would shift some responsibility from the state level to the local
level in terms of deciding what projects are completed. It would
provide discretionary authority or the potential for appropriation
of more of the federal highway funds to local governments for
projects in their area. It would also authorize use of some of
these moneys for planning. She referred to some posters that were
displayed around the committee room and explained one was from a
planning project that took place in Soldotna. She felt this was a
fresh approach that helps them to look at the opportunity of
building a road to actually improve people's quality of life and
make a positive change in the community. She asked if there were
any questions.
Number 110
REPRESENTATIVE BILL WILLIAMS said that within his district they
have been submitting what they would like to have done within the
transportation system of Ketchikan. Some of the projects have not
been looked at for years. He stated there was a project currently
underway in Ketchikan that has been on the books for 20 years and
is something they would like to see done. He asked if what
Representative Brown was talking about was a similar issue.
REPRESENTATIVE BROWN said her impression was that this issue varies
from area to area. The system may work better in a smaller
community than in Anchorage. She felt the system as it applies to
Anchorage is seriously broken and there is no clear accountability
between the citizens and the group that is responsible -- the
Anchorage Metropolitan Area Transportation Study (AMATS), but
Anchorage being a larger community has a different status under the
federal law. She said she has been trying for a number of years to
change the structure of how things are in Anchorage. She felt
there was nothing within HB 133 that would harm a small community.
It is intended to ensure that the process is responsive to what
local communities want, whatever their size.
CHAIRMAN DAVIS stated Ms. Mullen was in attendance from Soldotna to
present a slide show on some related projects in Soldotna.
Number 151
PEGGY MULLEN, Member, City Council; and Soldotna resident,
explained that her folks homesteaded in the area in 1948. She said
she has started a few small businesses there. She explained there
was a project they worked on this past February which involved a
great majority of the citizens in the process of some
transportation decision making issues. She said they were in
support of this legislation. She explained in 1993 there was a
sort of "harmonic convergence of happenings" in their area. They
worked on the Spurr and Sterling Highways because they were going
to be 3-R projects which consist of Rehabilitation, Restoration,
and Reconstruction. She explained Soldotna is approximately 150
miles south of Anchorage on the Sterling Highway. She said you can
either make a right when you get to Soldotna and go 10 more miles
and end up in Kenai or go 80 miles further and this would put you
in Homer. She stated there has been growing concern regarding the
Kenai River and keeping pollutants out of the river. This was one
of the reasons that the DOT/PF became involved in the project of
working with the storm drainage system which at this point runs
directly into the river at two different points off the highway.
MS. MULLEN said the DOT/PF had just completed a project in Sterling
which made the front page of the Anchorage Daily News because a
number of people were surprised when they saw the final plans for
this project contained high lighting and not a very "human scape
result" when they were through. It depicted a five lane road which
was necessary, but it depicted an inhuman effect in many people's
minds when the plans were completed. A young architect who was
working with Ms. Mullen's family to decide what to do with part of
their homestead and worked on a land use plan, said, "Gee, I didn't
even know the river was here." She said they wanted to construct
a project that would help to let people know that the river existed
because it is one of the key features of Soldotna. She said the
city manager and city council were interested in working with the
DOT/PF on ideas for the types of projects they could do and to
involve more people of Soldotna. In September 1994, the city
manager, the Mayor, and herself met in Anchorage with some DOT/PF
planners and engineers and decided to come up with some sort of
event that would involve the public and let them have as much input
as possible. She said she wanted to present some slides that would
show various aspects of the projects planned for Soldotna.
MS. MULLEN first referred to the projects plans that were done in
February. They were visited by an architect from Philadelphia who
coauthored a book that interested local architects. Ms. Mullen
said they rented an old school bus for $250 and brought down the
professionals from Anchorage along with the architect who was going
to help them with this project. They donated their time and some
money to the projects. They were landscape architects, architects
and planners. She then showed a slide depicting a map of Soldotna
with a tissue paper overlay with further suggestions on a possible
town commons/park area. She referred to a historic photo of
Soldotna around 1950 and indicated that the bridge over the Kenai
River in Soldotna was not constructed until 1950. She said part of
getting the public to show up at this meeting was to have the local
anthropologist line up six of the original homesteaders and a
couple of people who actually built the highway through Soldotna.
She explained this essentially established the town of Soldotna.
She said they talked a little bit about the lifestyle as it was
between 1948 and 1950. She then presented a slide with a photo of
a model that some school kids in the third grade at Soldotna
elementary did in preparation for this event. She said in the
planning process they had sent out a letter to the local schools
asking for involvement in this project. Three school teachers
along with their 70 to 80 students constructed a model of Soldotna
as it exists today. It also shows all the existing buildings and
the improvements they would like to see in the future. She said
they included in their model an underground viewing station to
watch the fish swimming up the Kenai River and an elevated train to
get around Soldotna. She added they had good community
involvement.
MS. MULLEN continued they decided to meet in the local high school
gym, which was a good centralized location for this event. It gave
them a "stage" to work with. There were approximately six or eight
small groups working all day on the project. She explained they
broke themselves up into groups and people discussed what they
liked about Soldotna's main street and what improvements could be
made as well. They discussed the identity of the town as far as
the summer activities in Soldotna. She commented on the
recreational vehicles that pass through Soldotna in the summer
months. The highway is Soldotna's main street but it also is the
main artery that leads to Homer. People in Soldotna have been for
a long time conflicted about not having a real center of their
town. She said they had the League of Women Voters present to help
out and take comments for the record. They also had some
"wonderful young architects" construct some visual drawings of what
people said.
MS. MULLEN said also helping them with this project were people
from the DOT/PF. For example, she was in the bridge construction
group and they had an engineer present who explained the
construction of the bridge and how they planned to include some
pedestrian amenities. She said currently the bridge does not
provide for any safe crossings for pedestrians. She showed a slide
that depicted a poster reading, "Soldotna make yourself at home."
This was designed to let people know when they were getting close
to Soldotna. She said there were some landscaping funds available
for this project, but she was not sure how much. She had
conversations regarding how the city could "play off their salmon
theme." She said there was a problem with Rvs wandering through
town. A suggestion was made to have a large parking lot just
before they get into town and provide the people with all the
tourist information and then a shuttle bus to take them around
town. She said there was a lot of concern of people driving too
fast through town because they are just passing through. She said
they talked with the DOT/PF early on in the process of constructing
a model of the town. She said they did come up with some federal
highway planning money that they were able to contribute to the
project. She said the entire event was on video and hoped that in
a month when it is finished it will be available to other
communities that have similar concerns.
MS. MULLEN reiterated the importance of the public involvement
they had not only from the city, but city residents, Chamber of
Commerce, DOT/PF and the local municipality. She showed a slide
that depicted the five lane highway running through Soldotna.
Also, an idea was presented on how Soldotna could do their snow
removal in a more efficient manner using a snow storage facility.
Currently, when the snow is not plowed the pedestrians are walking
directly on the streets. She said there was a lot of concern
regarding safety issues because of this. She said there was a high
number of young kids in town who like to ride their bicycles. She
said there was concern of the use of public lands in Soldotna in
relation to the river and the highway. Another issue that was
addressed during this project were things to do in the winter
months. She said there was a person who came down from Anchorage
as a resource from the Winter Cities group and suggested painting
the snow. She presented a slide showing a flower that had been
painted onto the snow. She said they talked about that in relation
to the bridge which, for not much additional funding could be
decorated with some color lighting.
Number 369
CHAIRMAN DAVIS stated most of Ms. Mullen's family is still in
Soldotna. He added Ms. Mullen and he attended high school
together. He said Ms. Mullen has been very active on the city
council with related projects such as this one. He then introduced
John Isaacs.
JOHN ISAACS, Alaska Chapter, American Planning Association, stated
he was part of a 130-member group who are municipal planners, state
resource managers and private practice individuals. He stated they
supported the intent of HB 133 because they feel it improves
participation in identifying transportation needs at the community
level. He participated in the Main Street program as well as
similar projects in Wasilla. He said it is exciting to see what
happens to communities when they are given the chance to design the
projects. He said in the past, many communities felt that the
DOT/PF had commandeered some of the Federal Intermodal System
Transportation Efficiency Act (ISTEA) funds and allocated them
internally without much local input or adequate participation. He
said they support the elements of this bill that emphasize
operation maintenance of existing transportation systems. He
commented it was really important to keep up what you have. He
said they supported the consideration of pedestrian and other types
of individual transportation modes. He said they support the
increase and direct pass through of planning funds and project
funds of the communities. Many of these communities are ready to
go; they have the funding and the capability to build and they
would like to do so. He said this also strengthens the local
review and approval process and builds a partnership in terms of a
joint local and state involvement in developing these
transportation facilities. Mr. Isaac said he was aware of the fact
that this bill needs some work but reiterated his support for the
intent, and would be glad to work with the committee and others
during the interim. He then asked if there were any questions.
Number 410
CHAIRMAN DAVIS then introduced Cheryl Richardson who was in
attendance to testify on HB 133.
CHERYL RICHARDSON, Member, Alaska Citizens Transportation
Coalition, said she is employed by the Alaska Center for the
Environment, by the Transportation Project and they have organized
the Alaska Citizen Transportation Coalition. The statewide
coalition is comprised of three borough governments: The North
Slope Borough; Northwest Arctic Borough; and Matanuska/Susitna
Borough. Also included are Native nonprofit organizations, Tanana
Chiefs Conference and the Association of Village Council Presidents
out of the Calista Region, League of Women Voters from around the
state, the Winter Cities Association out of Anchorage, and people
working on trail issues. She explained several issues brought them
together as a coalition. When she started this work in Anchorage,
it was a project to get children across a major arterial safely.
She said she has found these issues to be statewide concerns.
These people have come together under three headings. First is
public participation from the grassroots to help prioritize the
transportation problems within the communities and how they should
be addressed. As a part of involving the public we are asking that
good information is delivered to people so they can make judicious
decisions. Currently, they feel some of the information is lacking
about what the projects cost the community to build and operate and
cost in terms of safety and air pollution. Secondly, local control
over the projects. It is the section of the bill that allocates
potentially 35 percent of the dollars to local governments for them
to use on local projects. Third, they are looking at how projects
are designed statewide. She said a major concern in most cities is
that pedestrians do not feel safe. Another concern is that
projects are over built and cost vast sums of money to construct
and later maintain. Other concerns are lighting and speed limits
on the roads. These are statewide concerns - the scale just varies
from community to community. She said they were present today to
help the committee come to a consensus on these issues and
hopefully work with the committee during the interim to come up
with some language that could be incorporated statewide.
REPRESENTATIVE JAMES commented that she was pleased when this group
got together. She expressed her support for the issue and said we
should be pleased with the opportunity to get in on the ground
floor with the many transportation corridors in the state, and
emphasized the need and importance of ensuring they are done
correctly.
MS. RICHARDSON thanked Representative James for her support in the
project and said they appreciate Representative James's support of
rail systems in Alaska.
Number 453
KEVIN RITCHIE, Executive Director, Alaska Municipal League, said
they work with the Alaska Planners Association. He said this issue
is a high priority of the Alaska Municipal League, as you can see
the type of interest and creativity on the part of the
municipalities within Ms. Mullen's presentation, and added this was
true of all municipalities. They would like to take a vital role
in transportation planning for the state. He expressed interest in
working with the committee and other groups during the interim.
Number 465
CHAIRMAN DAVIS said he would keep Mr. Ritchie informed of any
meetings in the future regarding this issue. He then announced he
would take testimony via teleconference from Anchorage.
FRANK DILLON, Executive Director, Alaska Trucking Association
stated he was in opposition to SSHB 133. He explained SSHB 133 has
been in the thinking at the Center for the Environment for
sometime. He said they have studied ways that they can divert
highway money from actual timely transportation projects to come up
with a variety of very attractive packaging for that purpose. One
of them is the presupposition that the local people of the state,
"citizens," do not have a role in transportation planning at the
present time. Having attended numerous meetings over the past
several years with the DOT/PF and community councils on
transportation issues, he asked to differ with that analysis. He
expressed concern for the way this bill is structured. He said it
was placing constraints on construction projects and transportation
projects. He felt the real reason this bill was put forth is not
so much to improve transportation, but too slow the planning
process down so nothing gets accomplished.
CHAIRMAN DAVIS asked if Bo Brownfield who was in attendance would
like to testify.
BO BROWNFIELD, Deputy Commissioner, Department of Transportation &
Public Facilities, said their position is that they support some of
the concepts of this bill, such as the concept of increased public
participation. He commented on the slide presentation and
indicated it is a good success story. He said they agree with the
concept of alternative modes of transportation where it is feasible
and where it makes good sense. He said there are some good
features of this bill, but would be less than honest to point out
that there are some elements of this bill that need review. The
DOT/PF is prepared to work with the sponsor in the interim in an
attempt to resolve some of the issues they are concerned with. He
then asked if there were any questions.
Number 502
CHAIRMAN DAVIS said he would take testimony from Nancy Webb in
Fairbanks.
NANCY WEBB, Planning Consultant, testified via teleconference from
Fairbanks and said she donated time to the League of Women Voters
this past year to be part of the transportation coalition in the
hopes that this would move the state along into the next century
and get them to implement the ISTEA funds a bit more fully and take
advantage of all the funds that could be made available to the
state. She added the intent of SSHB 133 is a step forward but does
need some work. The League of Women Voters is very (indisc.) by
this bill. She suggested that Representative James cosponsor this
bill because of her background and interest in transportation
issues. She said she was disappointed in Mr. Dillon's comments.
She feels he does not fully understand what the group and project
are all about. She said he might be feeling some paranoia with
this environmental group that is involved. She said there was a
lot more than just the environmental groups involved in this
coalition. He should try and look beyond that fact.
GARY MOORE, Director, Planning and Development, Tanana Chiefs
Conference (TCC), testified via teleconference from Fairbanks and
said TCC is in full support of this bill. He had participated with
the Alaska Citizens Transportation Coalition since its formation.
He said that Ms. Richardson has done an outstanding job on bringing
a lot of the organizations together that otherwise would not,
including TCC. He said the reason they support SSHB 133 is because
the issue of the local control of transportation dollars is
important. He said they would like to see more local control,
local governments being able to help the DOT/PF make decision on
appropriate modes of transportation for the individual communities.
He said he also supported the idea of a certain percentage of state
dollars going to the local communities to help with the local
projects. He said he did not have a chance to review the bill in-
depth. He supported the idea of working on the bill through the
interim. He said he appreciated Representative James's position on
this bill. He indicated they do need a majority member to sponsor
this bill.
Number 564
CHAIRMAN DAVIS said he would take testimony via teleconference from
Anchorage.
WALTER PARKER testified in support of SSHB 133. He said he did not
see anything in the bill that as highway commissioner 20 years ago
he couldn't have lived with. The 35 percent he did not feel has
any great effect on the overall budget. Currently we are spending
more than that on the budgets within the boroughs and on local
projects. He said in regards to planning, he wished they had more
of this in the original DOT/PF bill.
Number 576
REPRESENTATIVE JAMES said the success of the Soldotna process,
which she was very impressed with, was due to people like Ms.
Mullen.
REPRESENTATIVE BROWN said she has been working with Mr. Kito and
referred to two amendments she had in the packet. She said she is
trying to address concerns and possibly other concerns beyond these
two amendments. The amendment that refers to Section 2 stresses
some of the things that would be calculated. When looking at what
projects will cost over a certain period of time, the adoption of
the amendment would help reduce the cost of fiscal note involved.
She added she did not want to require information that is not
relevant or useful.
CHAIRMAN DAVIS acknowledged the amendments and said it was clear
the amendments are addressing specific concerns that the DOT/PF
has. He said SSHB 133 will be carried over and discussed possibly
this coming Friday at 1:00 p.m.
ADJOURNMENT
There being no further business to come before the House
Transportation Committee, Chairman Davis adjourned the meeting at
3:05 p.m.
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