Legislature(2003 - 2004)
05/03/2004 09:06 AM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
May 03, 2004
9:06 AM
TAPES
SFC-04 # 104, Side A
SFC 04 # 104, Side B
CALL TO ORDER
Co-Chair Gary Wilken convened the meeting at approximately 9:06 AM.
PRESENT
Senator Gary Wilken, Co-Chair
Senator Lyda Green, Co-Chair
Senator Con Bunde, Vice Chair
Senator Fred Dyson
Senator Ben Stevens
Senator Lyman Hoffman
Senator Donny Olson
Also Attending: REPRESENTATIVE BILL WILLIAMS; REPRESENTATIVE PEGGY
WILSON; REPRESENTATIVE CHERYL HEINZE; ERNESTA BALLARD,
Commissioner, Department of Environmental Conservation; KRISTIN
RYAN, Director, Division of Environmental Health, Department of
Environmental Conservation; PAULA CADIENTE, Staff to Senator Elton;
JON BITTNER, Staff to Representative Cheryl Heinze; JON TILLINGHAS,
Sealaska Corporation; DOUG WOOLIVER, Administrative Attorney,
Office of the Administrative Director, Alaska Court System; PAT
DAVIDSON, Division of Legislative Audit; TIM BARRY, Staff to
Representative Bill Williams; HEATH HILYARD, Staff to
Representative Lesil McGuire;
Attending via Teleconference: From offnet locations: ROBIN
NORTHSEYER, owner and operator, Northern Hospitality Training and
Consulting; ERIN HALL-MEADE, Life Alaska Donor Services; DWAYNE
BANNOCK, Director, Division of Motor Vehicles, Department of
Administration
SUMMARY INFORMATION
HB 378-FOOD, DRUGS, COSMETICS, CERTAIN DEVICES
The Committee heard from the sponsor, the Department of
Environmental Conservation and a safe food handling training
company. The bill was reported from Committee.
HB 233-INCREASE EDUCATION FUNDING
The Committee heard from the sponsor. A committee substitute was
adopted and the bill was reported from Committee.
SB 282-RESTAURANTS ETC DISCLOSE WILD/FARMED FISH
The Committee heard from the Department of Environmental
Conservation. The bill was reported from Committee.
HB 10-GROUP HEALTH INS: PRIVATE GROUPS/PERSONS
The Committee heard from the sponsor. An amendment was adopted and
the bill was held in Committee.
HB 546-POLLUTION DISCHARGE & WASTE TRMT/DISPOSAL
The Committee heard from the Department of Environmental
Conservation and a Native Corporation. The bill was reported from
Committee.
HB 451-THERAPEUTIC COURTS
The Committee heard from the Alaska Court System. The bill was
reported from Committee.
HB 464-EXTEND BOARD OF REAL ESTATE APPRAISERS
The Committee heard from the Division of Legislative Audit and the
Legislative Budget and Audit Committee. An amendment was adopted
and the bill was reported from Committee.
HJR 5-CONST AM: INITIATIVE/REFERENDUM PETITIONS
The Committee heard from the sponsor. The bill was reported from
Committee.
HB 31-INITIATIVE/REFERENDUM PETITIONS
The bill was reported from Committee.
HB 337-ANATOMICAL GIFTS REGISTRY/AWARENESS FUND
The Committee heard from the sponsor, the Department of
Administration, and an organ harvesting organization. The bill was
reported from Committee.
SB 254-TOURISM MARKETING CONTRACTS
This bill was scheduled but not heard.
SB 395-EXTEND AK RAILROAD TO GREELY/ TASK FORCE
This bill was scheduled but not heard.
HOUSE BILL NO. 378
"An Act relating to the Alaska Food, Drug, and Cosmetic Act,
including sales, advertising, certain devices, food donors,
and food banks; making certain violations of organic food
provisions and of the Alaska Food, Drug, and Cosmetic Act
unfair methods of competition and unfair or deceptive acts
or practices under certain of the state's unfair trade
practices and consumer protection laws; and providing for an
effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated this bill, sponsored by the House Finance
Committee, "Authorizes the Department of Environmental Conservation
to implement key elements of the new food safety program, which are
called Active Managerial Control."
REPRESENTATIVE BILL WILLIAMS noted the fees for food inspections
have increased from $50 to approximately $450 per business. He
spoke of subsequent comments from businesses about these increased
fees given the infrequency of inspections. He therefore had asked
the previous and current gubernatorial administrations to eliminate
the fees, as businesses and consumers garner no benefit from these
fees.
ERNESTA BALLARD, Commissioner, Department of Environmental
Conservation, testified that cases of food borne illness are not
accidents but rather incidents: the failure of those handling the
food to observe well understood proper procedures. She continued as
follows.
Our program that Representative Williams has correctly
described as under funded and failing, is based on a 1950s
style, really a pre-WWII style, of restaurant inspections that
was designed in an era in which there were twenty million
meals served a day in restaurants. In the 50s and 60s with the
suburban boom that number jumped to 60 million meals a day
served in restaurants, and yet the same method of periodic
restaurant inspections was considered an adequate regulatory
program.
In 2004 the National Restaurant Association, the other NRA,
estimates that there will be 70 billion meals, a jump from 60
million fifteen years ago to 70 billion meals served in
restaurants. The inspection program of the 50s is not adequate
to restaurant safety, food safety today. With the urging of
the House Finance Committee and its Chair, we completely
redesigned. We looked at successful models of food safety in
particularly the three areas that are known to cause
incidences of illness: poor personal hygiene, which means hand
washing and attention to employee grooming and hygiene habits
and being sure that sick employees are being sent home. That's
one. The second is inadequate attention to temperature and
cooking procedures, which can be addressed with standard
operating procedures. And the third element is inadequate
training, which is being addressed by the restaurant
association and most of the large chains and by many states
and health departments in voluntary programs. Inadequate
training is being addressed by certification and training
programs. The National Restaurant Association recently
graduated their one millionth certified food handler from
their program.
We looked at those three areas. We looked at the very
successful regulatory programs that we run in air and soil and
water protection in which standard operating procedures and
self-certification with written records which are then audited
by the Department and a very heavy field presence in
compliance and enforcement. That is the method and model that
we use elsewhere in the DEC [Department of Environmental
Conservation] that is the method and model that we propose to
use in our Active Managerial Control.
We are actually excited about this. If you are not a
regulator you may not get excited about a new regulatory
method, but we're proud of what we have done. We have been in
contact with states around the country who are very interested
to see any state have the courage to walk away from the old,
under funded, and failed consultative program that we've all
been clinging to, and moving to a new, modern era of
regulatory control.
I want to close by pointing out the success that prevention
can have and protection against exposure. You are probably
aware of the outbreak of a Norwalk virus that occurred on the
Iditarod Trail in March. It began in McGrath. It was well
documented. Epidemiology and Kristin's staff together went
out. There were twenty cases in McGrath. The State employee
team followed the Trail, picked up evidence of cases all along
the Trail, and were very worried about what would happen in
Nome when the entire race and the entire army of followers and
supporters arrived in Nome. Kristin's staff, who are nothing
if they are not determined, talked to all of the restaurants
in Nome, the entire community smelled of Clorox, got all the
restaurants cleaned up, and then went and worked with the
Millennium Hotel, in the gymnasium where the banquet was held,
and got a thousand rubber gloves and got every person who went
to the Musher's Banquet to go through the food line with their
serving hand gloved. We have wonderful photographs of this.
There was not a single outbreak of Norwalk virus in Nome. The
Musher's Banquet was not spoiled. Those that had made it
successfully to Nome then did not have to take Montezuma's
Revenge home with them when they left.
Prevention works. Our Active Managerial Control program is
designed to put the responsibility where it appropriately
lies, and that is in the regulated community. It is adequate
to cover the entire state without regard to where our
inspectors may be at the time. We're very proud of it. I
hope you will consider it favorably today.
Senator Bunde referenced media reports of a viral outbreak in
Fairbanks and asked whether this outbreak is food borne as well.
KRISTIN RYAN, Director, Division of Environmental Health,
Department of Environmental Conservation stated that the Norwalk
virus is difficult to trace, although it is transmittable by air,
water, food, and hand-to-hand contact. She reported that the
Division is attempting to identify the origins and transmission
patterns of this outbreak.
Senator Bunde understood that the outbreak originated at two
establishments in Fairbanks.
Ms. Ryan affirmed that food is the carrier, although she was unsure
whether food was the original source.
ROBIN NORTHSEYER, owner and operator, Northern Hospitality Training
and Consulting, testified via teleconference from an offnet
location that she has been conducting food safety training. She has
found that the issue is not a lack of will in keeping people from
getting sick, but rather the lack of knowledge of how easily
illness could be transmitted through food. She emphasized that
training is "key" to public safety in Alaska given the number of
visitors. She expressed that spreading food borne illnesses to
tourists would be detrimental to the industry.
Senator Olson asked if the witness supports the bill and whether
her opinion represents the industry.
Ms. Northseyer affirmed both.
Senator Olson asked how this legislation would apply to small
restaurants located in small communities.
Ms. Ballard expressed the intention that all who handle raw food
would receive training in safe handling procedures. She stated that
the Department would ensure that training and testing activities
would not inconvenience owners and employees of businesses in small
communities.
Senator Dyson offered a motion to report the bill from Committee
with individual recommendations and accompanying fiscal notes.
There was no objection and HB 378 MOVED from Committee with zero
fiscal note #1 from the Department of Law and fiscal note #2 of
$210,700 from the Department of Environmental Conservation.
CS FOR HOUSE BILL NO. 233(EDU) am
"An Act increasing the base student allocation used in the
formula for state funding of public education; and providing
for an effective date."
This was the second hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated this bill, sponsored by Representative
Wilson, "increases the student dollar by $419." He directed
attention to a proposed committee substitute, which increases the
total student dollar to $4,576.
Co-Chair Green moved for adoption of CS HB 233, 23-LS0911\I as a
working document.
Senator Hoffman objected and stated that the original version of
the bill would have increased funding for education by $84.5
million, which is a higher amount then this committee substitute
would provide.
Co-Chair Wilken commented on arguments that the proposed increase
funding for education is from a one-time funding source. He
contended that this legislation expresses the Committee's intent
that the increase would be $82,053,300 for K-12 education, and that
the funding be ongoing.
Senator Hoffman removed his objection and the committee substitute,
Version "I" was ADOPTED as a working document.
REPRESENTATIVE PEGGY WILSON, sponsor of the bill, testified to her
support of reinstating the original appropriation amount.
Co-Chair Green offered a motion to report CS HB 233, 23-LS0911\I
from Committee with individual recommendations, new and forthcoming
fiscal notes.
Without objection CS HB 233 (FIN) MOVED from Committee with a
fiscal note dated 3/16/04 for $535,400 from the Department of
Military and Veterans Affairs, a fiscal note dated 5/3/04 for
520,100 from the Department of Education and Early Development,
Special Schools Component, and a fiscal note dated 5/10/04 for
$82,053,200 from the Department of Education and Early Development,
Foundation Program component.
CS FOR SENATE BILL NO. 282(RES)
"An Act relating to the identification of finfish in food
products and to the misbranding of food products consisting of
or containing finfish."
This was the second hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated this bill, sponsored by Senator Elton,
"requires restaurants to state on its menu whether the fish it is
serving is wild or farmed fish."
Co-Chair Green asked if restaurants would always know fish
origination information.
PAULA CADIENTE, Staff to Senator Elton, replied that she was
unsure.
KRISTIN RYAN, Director, Division of Environmental Health,
Department of Environmental Conservation, testified that of the 665
establishments the Division regulates, approximately 33 percent
would not have that information readily available. She estimated
that 10 percent would require enforcement actions due to
unwillingness to comply.
Senator Dyson offered a motion to report CS 282 (RES) from
Committee with individual recommendations and accompanying fiscal
notes.
There was no objection and SB 282 MOVED from Committee with zero
fiscal note #1 from the Department of Law, and $77,200 fiscal note
#2 from the Department of Environmental Conservation.
CS FOR HOUSE BILL NO. 10(HES)
"An Act relating to pooling by employers and self-employed
individuals for purposes of group health insurance; and
providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated this bill, sponsored by Representative
Heinze, "allows small and large employers and self-employed
individuals to form an association for the purpose of obtaining
health insurance."
JON BITTNER, Staff to Representative Cheryl Heinze, communicated
that small businesses could not afford the rising costs of health
insurance independently. The rates could be reduced if these
businesses joined together in acquiring insurance.
Mr. Bittner added that the committee substitute would provide
exceptions to allow insurers to refuse self-employed individuals on
the basis of certain criteria. The exceptions would prevent the
healthy employees of insured small businesses from paying inflated
rates to compensate for those who would require higher levels of
medical care.
Co-Chair Green inquired about this bill's ability to ensure lower
insurance rates.
Mr. Bittner responded that though it is less expensive for
insurance companies to insure business groups versus individual
businesses, this legislation could not guarantee lower insurance
rates.
Co-Chair Green suggested that the intent of this bill is primarily
to provide small businesses and the self-employed increased access
to insurance, as opposed to securing lower insurance rates.
Mr. Bittner confirmed that the bill could not guarantee lower
rates.
Senator Olson inquired about any restrictions in this bill that
would hinder a small business from acquiring insurance.
Mr. Bittner replied that the bill contains no such restrictions.
Amendment #1: This amendment changes the effective date of this Act
from July 1, 2003 to July 1, 2004.
Senator B. Stevens moved for adoption.
The amendment was ADOPTED without objection.
Senator Dyson referenced Section 4 on page 4, lines 17 through 23,
which reads as follows.
Sec. 4. AS 21.56.120 is amended by adding a new
subsection to read:
(e) In determining the premium rates for a small employer
covered under an association health insurance policy
authorized under AS 21.54.060(7), a small employer insurer may
not use the claims experience of the small employer while the
employer was covered under another health insurance policy and
may use only that underwriting information obtained through
the insurer's normal application process for new small
employer groups that are not written under the association
plan.
Senator Dyson questioned the necessity of the following lines: "a
small employer insurer may not use the claims experience of the
small employer while the employer was covered under another health
insurance policy."
Mr. Bittner responded that the language would ensure that the small
employer groups would experience the same application process as
any other organization when applying for health insurance.
Senator Dyson asked if federal law prohibits an insurer from
obtaining the past insurance claim information of a prospective
client.
Mr. Bittner responded that he was unsure.
Co-Chair Green suggested that Senator Dyson's question might be
related to the portability provision, which refers to an employee's
claim confidentiality in the transfer of coverage from one
employer, and insurance carrier, to another.
Representative Heinze agreed with Co-Chair Green. Representative
Heinze qualified that she would need to confirm the details of the
portability provision.
Senator B. Stevens agreed with Co-Chair Green's position on
portability. He referenced the aforementioned language in pointing
out that an insurer, in determining that organization's premium
rate, could not use the insurance claim history of an organization.
Co-Chair Green commented on the diversity of products that private
insurers offer. She also emphasized that insurance rates for
business pools would vary depending on the private insurer.
Co-Chair Wilken announced this bill would not report from Committee
at this hearing and that the Division of Insurance would be
contacted for input.
Co-Chair Green referenced a letter from the Division of Insurance
dated April 22, 2004 [copy on file] in emphasizing the need for
this legislation.
Representative Heinze reminded of President George Bush's State of
the Union address in which he expressed intent to "let the people
pool".
Senator Olson asked if a prohibition currently exists preventing
businesses from pooling together for health insurance purposes.
Representative Heinze replied this would be first time individuals
would be allowed to pool.
Co-Chair Wilken referenced the letter from the Division of
Insurance dated April 22, 2004 [copy on file] as well as
Representative Heinze's Sponsor Statement [copy on file] and their
mention of the Alaska Mental Health Trust Authority and its
partnership with the Foraker Group. He inquired about the purpose
and beneficial advances of the Foraker Group.
Mr. Bittner explained that the Foraker Group is a membership
organization for non-profit organizations. The Group has recently
formed an insurance pool exclusively for non-profit organizations,
which is expected to officially commence in the coming months.
Co-Chair Wilken asked if the Foraker Group's insurance pool is
strictly for non-profit organizations.
Mr. Bittner responded that yes, the Foraker Group only serves non-
profit organizations.
Co-Chair Wilken asked if this bill would only allow small
businesses to pool together for insurance purposes.
Mr. Bittner replied that this bill would include small businesses;
however, non-profit organizations could also pool under the
provisions of this bill. The Foraker Group's insurance pool is just
one option for non-profit organizations.
Co-Chair Wilken commented that he would be seeking the guidance of
those with experience in the insurance industry in considering the
issues addressed in this bill.
Representative Heinze stated that the Foraker Group is in support
of this bill, as its formation of an insurance pool for non-profit
organizations would not have been necessary had this legislation
been in effect.
Co-Chair Green recalled that the Foraker group requires membership
and an associated fee. She asked if a membership fee would be
prohibited among business pools under the provisions of this
legislation.
Mr. Bittner responded that a fee would not be prohibited.
Senator Olson remarked that the legislature should undertake every
possible effort to assist small businesses. He added, "If they
[small businesses] are in favor of this [bill] I am in favor of it
as well."
Representative Heinze relayed that "the whole State" is in favor of
this bill.
Senator Dyson remarked that an individual without health insurance
coverage must pay 30-40-percent more for services, which he
stressed, is "wrong".
Representative Heinze informed that it is "becoming prohibitive"
for small businesses to carry insurance and that many employers are
eliminating insurance coverage.
Co-Chair Wilken stated that he agrees with the intent of this bill,
but expressed interest in the testimony of other insurance industry
experts.
Senator Olson shared this interest.
Representative Heinze responded that this legislation has the
"total support" of the insurance industry.
Co-Chair Wilken requested a list of those who have spoken last year
and this year in support of the bill.
Co-Chair Green requested the letters written in support of this
legislation.
Co-Chair Green recommended further discussion on the methods
insurers utilize to establish group rates and the factors that
impact membership within these groups. She also urged review of
"adverse selection", which occurs in the insurance industry when
the insured opt out of their current coverage as a result of
increased rates, resulting in further rate increases for those
remaining under that coverage. She commented that while the intent
of this legislation is worthwhile, she was unsure whether it would
be successful in lowering insurance rates.
Co-Chair Wilken stated that Linda Hall, Director, Division of
Insurance, Department of Revenue, could assist in providing
information necessary to making these determinations.
Co-Chair Green agreed.
Co-Chair Wilken ordered the bill HELD in Committee.
CS FOR HOUSE BILL NO. 546(JUD)
"An Act relating to regulation of the discharge of pollutants
from timber-related activities under the National Pollutant
Discharge Elimination System; relating to waste treatment and
disposal permits; making conforming amendments; and providing
for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated this bill, introduced by the House Rules
Committee at the request of the Governor, "authorizes the
Department of Environmental Conservation to administer the National
Pollutant Discharge Elimination System permits for the timber
industry."
ERNESTA BALLARD, Commissioner, Department of Environmental
Conservation, stated that a change was adopted by the House of
Representatives in Section 5 of this bill, relating to the public
notices required in the proposed area of waste material disposal.
The number of public notices required was increased from one notice
to "at least two" publications of notice. Ms. Ballard summarized
that this bill is part of the Governor's objective to "streamline"
the permit process. This bill would not change permit requirements
or standards of protecting water quality, but rather would
eliminate one stop for the permit applicant. Currently applicants
must obtain permits from the federal Environmental Protection
Agency (EPA) and certify those permits with the Department of
Environmental Conservation as required by the Clean Water Act.
Permits required by the Clean Water Act cannot be eliminated;
therefore, the only action, which could be taken to simplify the
permit process is that provided for in this legislation: enabling
the State to assume primacy from the EPA in obtaining permits.
SFC 04 # 104, Side B 09:53 AM
Ms. Ballard stated that she was optimistic that the success of this
bill would demonstrate the "reasonableness" of the permit approach
it embodies, thus serving as a basis for proposing similar
legislation in other industries.
Senator Bunde referred to fiscal note #1 for $412,600 from the
Department of Environmental Conservation. He noted that the federal
receipts reflected in years 2005 and 2006 would no longer be
available after 2006. He questioned the effect of the loss in
funding.
Ms. Ballard responded that the federal receipts reflect a grant,
received from the EPA, which the Department of Environmental
Conservation would expend over two years: 2005 and 2006. This grant
is intended to assist the Department of Environmental Conservation
with the cost of the rulemaking required if this legislation is
implemented. The remaining expense detailed in the fiscal note
reflects the general fund cost of operating the permit program
after the federal grant is exhausted.
Senator Bunde asked if the cost of rulemaking would be eliminated
in conjunction with the federal grant.
Ms. Ballard replied that yes, all necessary rulemaking would be
completed in 2005 and 2006.
JON TILLINGHAS, Sealaska Corporation, testified in support of this
bill.
Co-Chair Green offered a motion to report the bill from Committee
with individual recommendations and accompanying fiscal note.
There was no objection and CS HB 546 (JUD) MOVED from Committee
with fiscal note #1 for $412,600 from the Department of
Environmental Conservation.
HOUSE BILL NO. 451
"An Act relating to therapeutic courts; and providing for an
effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated this bill, sponsored by the House Rules
Committee at the request of the Governor, "extends the pilot
program for therapeutic courts established in Anchorage and Bethel
for alcohol and drug addicted offenders out to June 30, 2006. In
addition, it repeals the sunset clause that will terminate an
Anchorage Superior Court Judge position."
DOUG WOOLIVER, Administrative Attorney, Office of the
Administrative Director, Alaska Court System, reiterated Co-Chair
Wilken's bill summary. Mr. Wooliver continued to testify the
following.
Just to give you a very brief history of this bill. In 2001
then Speaker of the House, Bryan Porter, introduced and the
legislature passed House Bill 172. And the purpose of that
bill was to create two pilot therapeutic court programs to
deal with felony DWI offenders.
The pilot programs were modeled in large part after the
pioneering work that was done by Judge Wanamaker in Anchorage.
Judge Wanamaker is a District Court Judge and established the
wellness court there [in Anchorage] where he deals with
misdemeanor offenders with significant alcohol abuse problems.
Judge Wanamaker has had great success with that program, and
Speaker Porter and the court system wanted to know if we could
replicate that success with felony level offenders; thus House
Bill 172.
In order to determine the effectiveness of these two pilot
programs, the bill required the judicial council to conduct a
study of those programs to determine their effectiveness. And
this study is important not only for your determinations in
the future as to whether or not to continue and/or expand
these types of programs, but it is important for the court as
well because they are very resource-intensive for the court,
and we want to make sure that they work. So the evaluation is
critically important. Unfortunately both the Anchorage and
Bethel programs terminate long before the evaluation has been
completed. So if you get the evaluation from the judicial
council and decide that these programs are worthwhile and
would like to continue them, both programs would have ended
over a year earlier. Attorneys are reassigned to other work;
the treatment programs are taking other participants. So all
this bill does in that regard is just extend the termination
of those two pilot programs until after the planned study is
completed and you have had the opportunity to review their
effectiveness. To our way of thinking it doesn't make a lot
of sense to terminate the programs before you have had an
opportunity to decide whether they should be terminated.
The second very important thing that this bill does is it
deletes a sunset clause that was put on a Superior Court Judge
that was added by House Bill 172. If that judge sunsets,
Anchorage basically looses a Superior Court Judge if that
sunset clause isn't deleted. That will mean not only the end
of the felony therapeutic court program, but because that
judge still spends most of her time on work not related to
therapeutic court it will have a significant impact on the
Superior Court caseload for all cases that come through the
Anchorage Superior Court.
The last time a judge was added to the Anchorage bench of
Superior Court Judge was in 1984, and since that time our
felony caseload has doubled, our children's caseload has
doubled, and other caseloads have risen dramatically. We
simply can't afford to return to a level of judicial coverage
that was established, literally, twenty years ago.
So in the end what this bill does is extends our two
therapeutic courts until after you and the court had the
opportunity to evaluate them, and it keeps a much-needed
Superior Court Judge seat in Anchorage.
Senator B. Stevens questioned fiscal note #6 for $257,200 from the
Alaska Court System. He asked whether the expenses detailed in the
fiscal note were already provided for in the FY 05 budget request.
Co-Chair Wilken referenced a memorandum he received from Mr.
Wooliver dated May 2, 2004 [copy on file], which stated that the
costs associated with the position are included in the FY 05 budget
request.
Mr. Wooliver acknowledged the apparent discrepancy. He explained
that zero fiscal notes typically detail in the analysis statement
whether existing funds would be utilized to implement the
legislation; however, the House Finance Committee directed this
fiscal note to include the existing costs. This bill would not
require any new expenses.
Senator B. Stevens clarified that this legislation would not incur
additional expense.
Co-Chair Green offered a motion to report the bill from Committee
with individual recommendations and accompanying fiscal notes.
Without objection HB 451 MOVED from Committee with zero fiscal
notes: #1 from the Department of Administration, #2 from the
Department of Corrections, #3 from the Department of Health and
Social Services, and #4 from the Department of Law, and fiscal note
#6 for $257,200 from the Alaska Court System.
HOUSE BILL NO. 464
"An Act extending the termination date of the Board of
Certified Real Estate Appraisers."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated this bill, sponsored by the House Rules
Committee at the request of the Legislative Budget and Audit
Committee, "extends the termination date of the Board of Certified
Real Estate Appraisers to 2008."
PAT DAVIDSON, Division of Legislative Audit, testified that this
bill is consistent with the recommendations in the document titled
"Board of Certified Real Estate Appraiser's Sunset Review" [copy on
file]. The report did not suggest either operational or statutory
changes.
Ms. Davidson added that the audit includes an assessment of the
Board of Certified Real Estate Appraisers' financial self-
sufficiency. The Board had accumulated a deficit at the end of FY
02; however, according to the sunset review the Board was moving
toward financial self-sufficiency at the end of FY 03.
Senator B. Stevens asked the Board of Certified Real Estate
Appraisers' annual revenues.
Ms. Davidson replied that the Board's annual revenue in FY 02 was
$18,676.
Senator B. Stevens understood that the Board is funded with fees
collected from licenses issued to real estate appraisers every two
years, thus operating on a two-year revenue cycle.
Ms. Davidson affirmed.
Senator B. Stevens asked the number of times the termination date
of the Board has been extended.
Ms. Davidson replied that this Board has not undergone as many
sunset reviews as other boards because the licensing of real estate
appraisers was implemented through federal legislation adopted in
1986: the Financial Institutions Reform, Recovery and Enforcement
Act of 1989. She estimated this is the third review conducted by
the Division of Legislative Audit of the Board of Real Estate
Appraisers.
Senator B. Stevens suggested that the termination date of the Board
of Real Estate Appraisers could be extended beyond four years.
Amendment #1: This amendment would extend the termination date of
the Board of Real Estate Appraisers from the proposed July 1, 2008,
to July 1, 2010.
Senator B. Stevens moved for adoption.
Ms. Davidson informed that the Division of Legislative Audit has
approved an overall review of the sunset process. The statutorily
suggested sunset extension for boards and commissions is currently
four years; however, in the Division's upcoming audit the four-year
extension would be reevaluated.
Co-Chair Wilken objected to the adoption of the amendment for an
explanation.
Senator Dyson commented on the general intent of the sunset
provisions to allow the elimination of a board or commission.
Although extending the review date could hamper this, he did not
anticipate that this Board would be terminated. He did not object
to the amendment.
HENRY WEBB, Committee Aide, Legislative Budget and Audit Committee
Aide and Staff to Representative Ralph Samuels, testified that the
sponsor of the bill would not object to the adoption of this
amendment.
Co-Chair Wilken removed his objection.
The amendment was ADOPTED without objection.
Co-Chair Green asked if the Board of Certified Real Estate
Appraisers was the board that experienced rate changes and
licensing issues approximately six to seven years ago.
Ms. Davidson was unsure and noted that a review of the Real Estate
Commission is due this year.
Co-Chair Green asked if the cause of the cyclical nature of the
Board of Real Estate Appraisers' revenue balance was a result of
operating on a biennial revenue cycle.
Ms. Davidson answered yes, and explained that the real estate
appraiser licenses issued by the Board are renewed for a two-year
period, resulting in cyclical revenues.
Co-Chair Wilken referred to the "Board of Certified Real Estate
Appraisers' Sunset Review", specifically a letter written by Edgar
Blatchford, Commissioner, Division of Legislative Audit. Co-Chair
Wilken offered for consideration Commissioner Blatchford's
recommendation to eliminate the Board, but continue licensing real
estate appraisers under the Division of Occupational Licensing. Co-
Chair Wilken understood this option was discussed in a House of
Representatives' hearing of this bill at which time real estate
appraisers opposed such action and requested that their current
licensing structure remain in place. He asked for a qualification
of this information.
Ms. Davidson did not recall the real estate appraisers' position.
She pointed out that legislation extending termination dates of
boards does not affect licensing functions. She emphasized that the
existence of a board typically ensures that regulations and
industry awareness are maintained.
Co-Chair Green offered a motion to report the bill as amended from
Committee with individual recommendations and accompanying fiscal
note.
Without objection, CS HB 464 (FIN) MOVED from Committee with fiscal
note #1 of $28,300 from the Department of Community and Economic
Development.
HOUSE JOINT RESOLUTION NO. 5
Proposing an amendment to the Constitution of the State of
Alaska relating to initiative and referendum petitions.
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated this bill, sponsored by Representative
Williams, "places before the voters a constitutional amendment that
changes the signature requirements for initiative and referendum
petitions."
TIM BARRY, Staff to Representative Bill Williams, testified that
currently, to place an initiative on the ballot, the Alaska State
Constitution requires signatures equal to ten-percent of voters who
voted in the most recent statewide general election from at least
27 of the 40 House districts. The amendment in this resolution
would change the requirement for placing an initiative on the
ballot. This resolution would require approval by a two-thirds plus
one vote of both bodies of the Alaska State Legislature and a
majority of the popular vote to bring the proposed amendment into
law.
Mr. Barry stated that this legislation is consistent with the
intent of the authors of the Alaska State Constitution, referencing
a document titled, "Additional Information for the Sponsor
Statement for HB 31/HJR 5: Initiative and Referendum Petitions"
[copy on file]. He stated that the authors of the Constitution
wanted to ensure that initiatives received "a measure of support"
throughout the State before being placed on the ballot. This
legislation would fulfill that goal by amending the Constitution to
reflect the current geographical distribution of the State of
Alaska.
Mr. Barry continued by referring to a report written by the
National Conference of State Legislatures titled "Constitution of
the State of Alaska"[copy on file], urging states to adopt
geographical distribution requirements for initiative petition
signatures such as that proposed by this resolution. He referred
to statistical data on signature petitions, included in the
"Initiative and Referendum Petitions" document. He proceeded to
testify as follows.
Of the ten initiatives that have been on the ballot since
1998, sponsors would have had to gather an average of 935
additional valid signatures to comply with this law. On these
ten petitions sponsors gathered an average of 40,148 total
signatures [when], in fact, the proposed legislation only
requires signature gatherers to get signatures from as few as
2.4 percent, and at the most, 6.4 percent of registered voters
in each district.
Senator Bunde asked if the proposed resolution would reduce the
overall number of signatures required to put an initiative on the
ballot.
Mr. Barry replied that this legislation would not change the total
number of signatures required statewide for an initiative, but
rather would require a greater number of signatures in each of the
districts.
Senator Bunde commented that although the election district he
represents is one with a high population concentration and
increasing growth, he supports this legislation. This resolution
would increase public confidence in government by giving Alaskans
assurance against paid petition gatherers soliciting signatures in
heavily populated areas of the State.
Co-Chair Wilken asked for a more thorough explanation of the
initiative requirements. He requested that Mr. Barry go over a
document titled "1997 Term Limits Pledge"[copy on file].
Mr. Barry explained, using the "1997 Term Limits Pledge" chart, the
current requirements to place an initiative on the ballot versus
the requirements of this resolution.
Senator Olson asked whether this legislation has received any
testimony in opposition or support from residents of rural Alaska.
Mr. Barry replied that a significant amount of testimony from rural
residents has been received in support of this bill. He could not
recall any opposition voiced from rural residents.
Senator Dyson spoke to the "unfortunate gradual shift" of political
power to urban areas. He expressed regret that the State Senate
districts were divided into geographical areas. He opposed the use
of professional petition signature gatherers for ballot
propositions. He supported this bill, particularly in relation to
issues affecting rural residents, as it would return some power to
rural areas.
Senator Dyson offered a motion to report the bill from Committee
with individual recommendations and accompanying fiscal note.
There was no objection and HJR 5 MOVED from Committee with fiscal
note #1 for $1,500 from the Office of the Governor.
HOUSE BILL NO. 31
"An Act relating to initiative and referendum petitions; and
providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated this bill, sponsored by Representative
Williams, "makes the necessary statutory changes to reflect the
intent of HJR 5, and this takes effect only if the constitutional
amendment passes."
Senator Bunde offered a motion to report the bill from Committee
with individual recommendations and accompanying fiscal note.
Without objection HB 31 MOVED from Committee with zero fiscal note
#2 from the Office of the Governor.
CS FOR HOUSE BILL NO. 337(FIN)
"An Act relating to anatomical donor registries, to an
anatomical gift awareness fund, to an anatomical gift
awareness program, to motor vehicle licenses and
registrations, and to state identification cards."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated this bill, sponsored by Representative
McGuire, "creates an organ donor registry program in which the
information obtained by DMV [Department of Motor Vehicles] can be
transferred to Life Alaska Donor Services. [It] allows motor
vehicle applicants to donate a dollar or more to the Organ and
Tissue [Donation] Awareness Fund."
HEATH HILYARD, Staff to Representative Lesil McGuire, testified
that currently, when applying for an operator's license or vehicle
registry, an individual would decide to become an organ donor
through the Division of Motor Vehicles. This process does not allow
for donor information to be disseminated beyond the Division. The
proposed legislation would establish an organ donor registry, which
would allow for a transfer of information between the Division and
Life Alaska Donor Services, the State's organ and tissue donor
program. Participation in the registry would be voluntary, and a
donor could be removed from the registry at his or her will.
ERIN HALL-MEADE, Life Alaska Donor Services, testified via
teleconference from an offnet location that she was available for
questions.
DWAYNE BANNOCK, Director, Division of Motor Vehicles, Department of
Administration, testified via teleconference from an offnet
location that the Division is "proud to support this bill".
Senator Olson asked if this legislation would result in slowing
down the surgical procedure of harvesting organs.
Mr. Hilyard replied this legislation would expedite the process.
Ms. Hall-Meade affirmed.
Senator Bunde offered a motion to report this bill from Committee
with individual recommendations and accompanying fiscal notes.
Without objection CS HB 337 (FIN) MOVED from Committee with zero
fiscal note #1 from the Department of Health and Social Services
and fiscal note #2 for $7,000 from the Department of
Administration.
AT EASE 10:32 AM / 3:09 PM
ADJOURNMENT
Co-Chair Gary Wilken adjourned the meeting at 03:09 PM
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