Legislature(2003 - 2004)

05/04/2004 09:07 AM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                              MINUTES                                                                                         
                     SENATE FINANCE COMMITTEE                                                                                 
                            May 4, 2004                                                                                       
                              9:07 AM                                                                                         
                                                                                                                                
                                                                                                                                
TAPES                                                                                                                       
                                                                                                                                
SFC-04 # 105,  Side A                                                                                                           
SFC 04 # 105,  Side B                                                                                                           
SFC-04 # 106,  Side A                                                                                                           
SFC 04 # 106,  Side B                                                                                                           
                                                                                                                                
CALL TO ORDER                                                                                                               
                                                                                                                                
Co-Chair Gary Wilken convened  the meeting at approximately 9:07 AM.                                                            
                                                                                                                                
PRESENT                                                                                                                     
                                                                                                                                
Senator Lyda Green, Co-Chair                                                                                                    
Senator Gary Wilken, Co-Chair                                                                                                   
Senator Fred Dyson                                                                                                              
Senator Ben Stevens                                                                                                             
Senator Donny Olson                                                                                                             
Senator Con Bunde, Vice-Chair                                                                                                   
Senator Lyman Hoffman                                                                                                           
                                                                                                                                
Also  Attending:  SENATOR  GENE  THERRIAULT;  REPRESENTATIVE   KEVIN                                                          
MEYER;  REPRESENTATIVE  DAN OGG; PATRICK  GAMBLE,  President &  CEO,                                                            
Alaska  Railroad   Corporation,  Department   of  Revenue;   RICHARD                                                            
SCHMITZ,  Staff to  Senator John  Cowdery; CINDY  CASHEN,  Executive                                                            
Director, Mothers Against  Drunk Driving, Juneau Chapter; DON SMITH,                                                            
Administrator, Alaska Highway  Safety Office; LINDA SYLVESTER, Staff                                                            
to  Representative  Bruce  Weyhrauch;  SUE  HARGIS,  Boating  Safety                                                            
Specialist,  United  States  Coast  Guard;  JACK  CADIGAN,  Captain,                                                            
United  States  Coast  Guard  Retired,  and Representative,   United                                                            
States   Coast   Guard  Auxiliary;   VANESSA   TONDINI,   Staff   to                                                            
Representative   Lesil  McGuire;   DOUG   WOOLIVER,  Administrative                                                             
Attorney,  Office  of  the  Administrative  Director,  Alaska  Court                                                            
System;  MICHAEL LESSMIER,  Attorney,  State Farm  Insurance;  LINDA                                                            
HALL, Director,  Division of Insurance, Department  of Community and                                                            
Economic Development;  BARBARA COTTING, Staff to Representative  Jim                                                            
Holm;  DEBRA  BEHR,   Assistant  Attorney  General,   Legislative  &                                                            
Regulations Section,  Office of the Attorney General,  Department of                                                            
Law;  DAVE  STANCLIFF,   Staff,  Administrative  Regulatory   Review                                                            
Committee,  Office of the Senate President  Gene Therriault;  PORTIA                                                            
PARKER, Deputy Commissioner,  Office of the Commissioner, Department                                                            
of Corrections                                                                                                                  
                                                                                                                                
Attending  via  Teleconference:   From  Anchorage:  SARA   HEIDEMAN,                                                          
Attorney representing  the Native  Village of Eklutna; From  Seward:                                                            
RON  LONG; From  an Offnet  Site:  BARBARA BRINK,  Director,  Public                                                            
Defender  Agency,  Department  of  Administration;  JENNIFER  YUHAS,                                                            
Executive Director,  The Alaska Outdoor Council; From  Mat-Su: CLIFF                                                            
JUDKINS,   Chair,   Alaska  Boating   Association;   JERRY   MCCUNE,                                                            
Representative,  United Fishermen  of Alaska  and Cordova  Fishermen                                                            
United                                                                                                                          
                                                                                                                                
SUMMARY INFORMATION                                                                                                         
                                                                                                                                
SB 254-TOURISM & RECREATION ASSESSMENT                                                                                          
                                                                                                                                
The  Committee   heard  from  the   sponsor,  adopted  a   committee                                                            
substitute, and reported the bill from Committee.                                                                               
                                                                                                                                
SB 395-MUNICIPAL LAND USE REGULATION                                                                                            
                                                                                                                                
The  Committee  heard  from  the sponsor  and  the  Alaska  Railroad                                                            
Corporation.  Public testimony was  taken, and the bill was  held in                                                            
Committee.                                                                                                                      
                                                                                                                                
SR 3-COMMEMORATING SEN. FRANK FERGUSON                                                                                          
                                                                                                                                
The Committee  heard from  the sponsor, adopted  one amendment,  and                                                            
reported the bill from Committee.                                                                                               
                                                                                                                                
SB 224-LOWER DWI FOR MINORS TO .02                                                                                              
                                                                                                                                
The Committee  heard from the bill's sponsor, Mothers  Against Drunk                                                            
Driving, the Public  Defender Agency, and the Alaska  Highway Safety                                                            
Office. The bill reported from Committee.                                                                                       
                                                                                                                                
HB 93-BOATING SAFETY, REGISTRATION, NUMBERING                                                                                   
                                                                                                                                
The  Committee  heard from  the  Sponsor,  the United  States  Coast                                                            
Guard, and took public  testimony. One amendment was considered, but                                                            
not adopted, and the bill reported from Committee.                                                                              
                                                                                                                                
HB 227-DISTRICT COURTS & SMALL CLAIMS                                                                                           
                                                                                                                                
The Committee  heard from the sponsor  and the Alaska Court  System.                                                            
The bill reported from Committee.                                                                                               
                                                                                                                                
HB 336-MOTOR VEHICLE INS./ UNINSURED DRIVERS                                                                                    
                                                                                                                                
The Committee  heard from the sponsor,  the Department of  Community                                                            
and Economic  Development, and the  insurance industry and  reported                                                            
the bill from Committee.                                                                                                        
                                                                                                                                
HB 419-REGIONAL SEAFOOD DEVELOPMENT ASS'NS./TAX                                                                                 
                                                                                                                                
The Committee  heard from the sponsor,  the Department of  Community                                                            
and  Economic  Development,  and the  industry.  One  amendment  was                                                            
adopted and the bill reported from Committee.                                                                                   
                                                                                                                                
HJR 44-SEA OTTER RESEARCH/ENDANGERED SPECIES                                                                                    
                                                                                                                                
The Committee  heard  from the sponsor  and reported  the bill  from                                                            
Committee.                                                                                                                      
                                                                                                                                
HB 424-REGULATION REVIEW / ANNULMENT                                                                                            
                                                                                                                                
The Committee  heard from  the sponsor, the  Department of  Law, and                                                            
the Regulatory  Review Committee. The bill reported  from Committee.                                                            
                                                                                                                                
HB 484-CORRECTIONS: FEES/SURCHARGE                                                                                              
                                                                                                                                
The Committee heard from  the Department of Corrections and the bill                                                            
reported from Committee.                                                                                                        
                                                                                                                                
HB 533-IF UNREAS. AGENCY DELAY, COURT DECIDES                                                                                   
                                                                                                                                
The  Committee  heard  from  the  sponsor,  the  Regulatory   Review                                                            
Committee, and  the Alaska Court System. The bill  was reported from                                                            
Committee.                                                                                                                      
                                                                                                                                
HB 511-CERTIFICATE OF NEED PROGRAM                                                                                              
                                                                                                                                
This bill was scheduled but not heard.                                                                                          
                                                                                                                                
                                                                                                                                
     CS FOR SENATE BILL NO. 254(L&C)                                                                                            
     "An Act  relating to the levy  and collection of an  assessment                                                            
     on  certain  tourism-related   and  recreation-related   sales,                                                            
     leases,  and rentals,  to tourism marketing  contracts,  and to                                                            
     vehicle rental taxes;  relating to Alaska marine highway system                                                            
      passenger fares; and providing for an effective date."                                                                    
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair Wilken  pointed out that this legislation  would reduce the                                                            
level  of the  tourist  industry's match  requirement  as  currently                                                            
specified in  the Millennium Plan.  by changing He noted  that a new                                                            
committee substitute,  Version 23-LS0947\Z  is before the  Committee                                                            
for consideration.                                                                                                              
                                                                                                                                
AT EASE: 9:11 AM / 9:11 AM                                                                                                      
                                                                                                                                
SENATOR GENE THERRIAULT,  the bill's sponsor, informed the Committee                                                            
that while the  original purpose of this legislation  was to further                                                            
funding  mechanisms  through which  the  tourism industry  could  be                                                            
assessed to support  marketing efforts "to make the  State of Alaska                                                            
a destination," the Version  "Z" committee substitute reflects that,                                                            
due to industry outfall  and such things as the industry's inability                                                            
to generate  funds equivalent  to the 60-percent  level mandated  in                                                            
the  tourism  marketing  Millennium  Plan,  the bill  has  been  re-                                                            
directed to  continue the current  Millennium Marketing Plan  and to                                                            
lower the required industry contribution to 50-percent.                                                                         
                                                                                                                                
Senator Therriault  voiced appreciation, however,  for the fact that                                                            
the  industry does  recognize  the State's  fiscal  dilemma and  is,                                                            
therefore,  actively attempting to  develop self-funding  avenues to                                                            
market the  State, even  though the industry's  original  Millennium                                                            
Plan's assessment was unobtainable.                                                                                             
                                                                                                                                
Co-Chair  Wilken noted  that  a Department  of Revenue  zero  fiscal                                                            
note,  dated May  4,  2004 accompanies  the  Version  "Z"  committee                                                            
substitute.                                                                                                                     
                                                                                                                                
Co-Chair Green moved to  adopt the committee substitute, Version "Z"                                                            
as the working document.                                                                                                        
                                                                                                                                
There being no  objection, the Version "Z" committee  substitute was                                                            
ADOPTED as the working document.                                                                                                
                                                                                                                                
Senator  Bunde questioned  the  amount the  State might  spend  as a                                                            
result of changing  the tourism marketing plan to  a 50/50 split, as                                                            
he pointed  out  that the  Department of  Revenue  zero fiscal  note                                                            
simply reflects the fact  that the bill would not increase the level                                                            
of funding that the State has been spending in this regard.                                                                     
                                                                                                                                
Senator  Therriault  qualified  that he  did  not have  the  funding                                                            
particulars with him.                                                                                                           
                                                                                                                                
Co-Chair Wilken  understood the amount  to be four million  dollars.                                                            
                                                                                                                                
Co-Chair  Green clarified  that  the State's  share  of the  expense                                                            
would be $2 million in FY 05.                                                                                                   
                                                                                                                                
Co-Chair Wilken acknowledged.                                                                                                   
                                                                                                                                
Senator Bunde understood  therefore that the combined State/industry                                                            
marketing expenditure would amount to four million dollars.                                                                     
                                                                                                                                
Co-Chair  Green  moved  to  report  the  committee  substitute  from                                                            
Committee with  individual recommendations  and accompanying  fiscal                                                            
note.                                                                                                                           
                                                                                                                                
Senator Bunde objected.                                                                                                         
                                                                                                                                
Senator  Bunde asked  whether  the original  Millennium  Plan had  a                                                            
termination date.                                                                                                               
                                                                                                                                
Senator Therriault responded that it did not.                                                                                   
                                                                                                                                
Senator Bunde removed his objection.                                                                                            
                                                                                                                                
There being no further  objection, CS SB 254 (FIN) was REPORTED from                                                            
Committee with  a new zero fiscal note, dated May  4, 2004, from the                                                            
Department of Revenue.                                                                                                          
                                                                                                                                
                                                                                                                                
     CS FOR SENATE BILL NO. 395(TRA)                                                                                            
     "An  Act  relating  to  application  of  municipal   ordinances                                                            
     providing  for planning, platting,  and land use regulation  to                                                            
     interests  in land owned  by the Alaska  Railroad Corporation;                                                             
     authorizing the Alaska  Railroad Corporation to extend its rail                                                            
     line to  Fort Greely, Alaska;  authorizing the Alaska  Railroad                                                            
     Corporation   to  issue  bonds  to  finance  the  cost  of  the                                                            
     extension   and  necessary   facilities   and  equipment;   and                                                            
     providing for an effective date."                                                                                          
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair  Wilken pointed out  that this bill  has two sections:  one                                                            
would authorize  the Alaska Railroad Corporation (ARRC)  to issue up                                                            
to $500  million in tax-free  revenue bonds  to pay for a rail  line                                                            
extension to Delta and  Fort Greely; and the other would exempt land                                                            
owned  by the  Railroad  from  municipal  land use  regulations.  He                                                            
pointed  out that  CS  SB 395(TRA),  Version  23-LS1965\H,  and  its                                                            
accompanying fiscal note were before the Committee.                                                                             
                                                                                                                                
Senator Therriault, the  bill's sponsor, explained that the original                                                            
bill  was developed  in response  to a  recent State  Supreme  Court                                                            
ruling, Native  Village of Eklutna  v. Alaska Railroad Corporation,                                                             
regarding  the Railroad's  right to  continue to  operate a  granite                                                            
quarry  in the  Eklutna  area.  Section 1,  he  continued,  contains                                                            
language that  would ensure that Railroad operations  could continue                                                            
and not be  subject to differing planning  and zoning ordinances  as                                                            
rail lines flowed from one community to another.                                                                                
                                                                                                                                
Senator Therriault  recounted that the bill was expanded  to include                                                            
bond package  language that  would fund extending  the rail  line to                                                            
Fort Greely  with the possibility  of connecting with Canadian  rail                                                            
lines and  continental lines  in the Lower  48. He assured  that the                                                            
bonding language  would not jeopardize Railroad or  State assets, as                                                            
long-term federal contracts  would support the bond requirements. He                                                            
reviewed  the planned route  of the rail line  as well as the  goods                                                            
that could  be transported on the  line. He concluded that  numerous                                                            
economic benefits would result were this rail line extended.                                                                    
                                                                                                                                
Co-Chair Wilken,  noting that the bill sections were  very "distinct                                                            
from  each  other,"  specified   that  the  two  sections  would  be                                                            
addressed separately.                                                                                                           
                                                                                                                                
PATRICK  GAMBLE,  President  &  CEO,  Alaska Railroad  Corporation,                                                             
Department  of Revenue, communicated  that  there has been  positive                                                            
response  to the  bonding  proposal,  as defined  in  Section 2,  to                                                            
finance the rail line extension  to Delta and Fort Greely. He stated                                                            
that  the federal  Department  of  the  Army  is interested  in  the                                                            
railroad extension  as it would provide  the Army greater  access to                                                            
training areas  as well as to land  in the Fort Greeley area  slated                                                            
for  an expanded  federal  missile  program  to  be staffed  by  the                                                            
National Guard.  He conceptualized  that the rail line "would  serve                                                            
as a two-lane  road" that could transport military  personnel, their                                                            
families, and  contractors, on a year-round basis.  He declared that                                                            
this rail line extension is "very attractive" to the military.                                                                  
                                                                                                                                
Mr.  Gamble explained  that  in order  to  fund the  extension,  the                                                            
Railroad  would  act as  the bond  fiduciary  and use  its  tax-free                                                            
bonding authority,  which  has never been  utilized before,  for the                                                            
$500 million  project.  He stated that  a portion  of the bond  debt                                                            
would conceptually  be paid by usage contracts between  the Railroad                                                            
and  two separate  federal  military  entities:  the  Department  of                                                            
Defense Army  and Missile  Command, as, he  explained, the  contract                                                            
would  be  less  expensive   to  the  military  than   their  annual                                                            
operations and  maintenance (O&M) expense budgets  would be were the                                                            
rail line extension not in place.                                                                                               
                                                                                                                                
Mr.  Gamble  stated that  while  discussions  have  transpired  with                                                            
military  personnel within  the State, they  have not occurred  with                                                            
the Department  of the  Army. He  also noted  that discussions  with                                                            
affected Alaskan communities are scheduled in the near future.                                                                  
                                                                                                                                
Senator Bunde referenced  comments indicating that the bond issuance                                                            
would not  incur any expense  to the State.  However, he  questioned                                                            
whether the fact that "the  Railroad is an instrument of the State,"                                                            
would not make  the State "the ultimate  guarantor of these  bonds."                                                            
                                                                                                                                
Senator Therriault responded  that due to the fact that "this is not                                                            
conduit funding,"  Senator  Bunde is correct  in that, were  there a                                                            
default  on the part  of a State  owned entity,  the State would  be                                                            
responsible. However, he  declared that a default would be unlikely,                                                            
were a contract  in place with the  federal government.   He pointed                                                            
out that  language addressing  the federal  government agreement  is                                                            
located in Section 4, Subsection  (b) beginning on page two, line 30                                                            
and  continuing  through  page  three,  line seven  which  reads  as                                                            
follows.                                                                                                                        
                                                                                                                                
     (b) Before issuing  bonds to provide the financing described in                                                            
     this section, the  Alaska Railroad Corporation shall enter into                                                            
     an agreement  with the United  States government that  will, in                                                            
     the   judgment   of   the  corporation,    provide   sufficient                                                            
     consideration to                                                                                                           
           (1) pay the principal of and interest on the bonds as                                                                
     they become due;                                                                                                           
           (2) create and maintain the reserves for the bond                                                                    
     payments   than   the  corporation   considers   necessary   or                                                            
     desirable; and                                                                                                             
           (3) pay all costs necessary to service or additionally                                                               
     secure the  bonds, including trustee's fees and  bond insurance                                                            
     premiums,  unless those costs  are to be paid by a party  other                                                            
     than the corporation.                                                                                                      
                                                                                                                                
Senator Bunde continued  to voice concern, as he argued, the federal                                                            
government  could change its  position in  regards to the  contract.                                                            
Therefore,  he asked, that were this  a consideration, whether  this                                                            
bond package could affect the State's bond rating ability.                                                                      
                                                                                                                                
Senator Therriault deferred  to Mr. Gamble to address the affect the                                                            
bond package might have  on the State's bonding ability. However, he                                                            
exampled  that  while  one  Legislature   "could  not  bind"  future                                                            
Legislators,  the State  would  be obligated  to  fulfill any  legal                                                            
contracts  entered into.  Similarly,  he argued,  that were  federal                                                            
military  plans to change  and were the missile  base dismantled,  a                                                            
signed federal/State  contractual  arrangement would continue  to be                                                            
honored.                                                                                                                        
                                                                                                                                
AT EASE 9:27 AM / 9:27 AM                                                                                                       
                                                                                                                                
Senator  Bunde voiced  a wildlife  resource concern  as he  reminded                                                            
that the  Railroad currently  has  problems with  moose on the  rail                                                            
line.  He questioned  whether  bison could  pose  a similar  problem                                                            
along the proposed Delta area rail line route.                                                                                  
                                                                                                                                
Mr. Gamble responded  that the "good news" is that  the geography of                                                            
this route  is relatively flat and  as such, would allow  animals to                                                            
move  out of  the  way  of a  train  as opposed  to  the  difficulty                                                            
presented to them by "the  deep channels" that the train tracks have                                                            
in other areas of the State.  He acknowledged that this concern must                                                            
be adequately addressed  and the federal government must approve the                                                            
plan before contract negotiations are finalized.                                                                                
                                                                                                                                
Co-Chair  Wilken,  being  "very  familiar   with  the  terrain"  the                                                            
proposed  rail line  would transit,  asked regarding  the  "physical                                                            
scope" of the  project as described in Section 4,  subsection (a) on                                                            
page two, lines  23 and 24 as he perceived the costs  to be high. In                                                            
addition,  he asked  whether the  project might  extend beyond  Fort                                                            
Greely.                                                                                                                         
                                                                                                                                
Mr. Gamble specified that  the $500 million project cost estimate is                                                            
all-inclusive  in that it would sufficiently fund  any required land                                                            
acquisition,   existing   rail   line  improvements,   maintenance,                                                             
equipment, sidings, small  depots, and the terminus of the rail line                                                            
at  Fort Greely  amongst  other  things.  He  pointed out  that  the                                                            
proposal  also contains  a "healthy  contingency  piece in the  cost                                                            
estimate  for  engineering  and construction."   He noted  that  the                                                            
project  cost  also includes  $45  million  that  would be  used  to                                                            
construct a  bridge across the Tanana  River to assist the  military                                                            
in accessing  their land. In summary,  he concluded that,  including                                                            
contingencies,  the  $500 million  estimate  is not  a conservative                                                             
number.                                                                                                                         
                                                                                                                                
Co-Chair  Wilken asked whether  the aforementioned  bridge  would be                                                            
located at Flag Hill Bridge.                                                                                                    
                                                                                                                                
Mr. Gamble concurred.                                                                                                           
                                                                                                                                
Co-Chair Wilken asked whether  the bridge construction project would                                                            
additionally  include a  rail line  extension into  the Blair  Lakes                                                            
area.                                                                                                                           
                                                                                                                                
Mr. Gamble  stated that,  in addition  to the  main rail line  being                                                            
extended toward  Delta Junction, an 11-mile rail extension  into the                                                            
Blair  Lakes  area would  also  be  constructed  in order  to  allow                                                            
military  vehicles  to be  offloaded within  the  parameters of  the                                                            
military training  range rather than  being offloaded and  hampering                                                            
transit on the main rail line.                                                                                                  
                                                                                                                                
Co-Chair   Wilken   asked   regarding  the   terminus   slated   for                                                            
construction in Fairbanks.                                                                                                      
                                                                                                                                
Mr. Gamble  responded  that in addition  to a  terminal at the  Fort                                                            
Wainwright   military   base   to   accommodate   military   freight                                                            
operations, a passenger  terminus would be constructed in Fairbanks.                                                            
                                                                                                                                
Co-Chair  Wilken   requested  that  a  complete  project   scope  be                                                            
developed to accompany the bill.                                                                                                
                                                                                                                                
Senator  Therriault, referencing  Co-Chair  Wilken's question  about                                                            
whether the  rail line would be extended  beyond Fort Greely,  noted                                                            
that language  in Section  4, subsection (b)  on page two,  lines 30                                                            
and  31,  specifies  that  before  the bonds  could  be  issued,  an                                                            
agreement between  the federal government  and the State  must be in                                                            
place.  Continuing, he  noted that  extending the  line beyond  Fort                                                            
Greely would  not benefit the federal  government and therefore,  it                                                            
would not  be expected  that their contract  would include  anything                                                            
beyond that point.                                                                                                              
                                                                                                                                
Co-Chair  Wilken  noted  that in  previous  years,  discussions  had                                                            
included  building  a  rail  line  that would  bypass  the  City  of                                                            
Fairbanks.  Therefore,  he  voiced  concern,  for the  record,  that                                                            
constructing  an 11-mile spur line  into the Blair Lakes  area might                                                            
rekindle that  discussion, which, he attested, "would  not be in the                                                            
best interest of Fairbanks."                                                                                                    
                                                                                                                                
Co-Chair  Wilken asked  whether  the selling  of  these bonds  would                                                            
negatively affect the State's  ability to bond for the gas pipeline.                                                            
                                                                                                                                
Mr. Gamble  responded  no, as  he reminded  the  Committee that  the                                                            
Railroad's  tax-free bonding ability  is not subject to the  bonding                                                            
limit of the State.  In addition, he stated that this  bond issuance                                                            
would not  affect the  Legislature's previous  year's [unspecified]                                                             
authorization  to allow  the Railroad  to  issue bonds  up to a  17-                                                            
billion dollar limit.                                                                                                           
                                                                                                                                
Co-Chair  Wilken  stated that  the  discussion  would  now shift  to                                                            
Section  1, which  pertains to  local municipality  regulations  and                                                            
their applicability to the Railroad.                                                                                            
                                                                                                                                
Mr. Gamble  commented  that the core  issue of  Section 1 might  "be                                                            
misunderstood."  He  quoted from  the Supreme  Court  ruling on  the                                                            
aforementioned  case  that  prompted this  legislation  as  follows:                                                            
"because  the Legislature  did  not clearly  express  its intent  to                                                            
exempt the Railroad from  local zoning laws, we reverse and remand."                                                            
Therefore,  he communicated, the intent  of this legislation  is "to                                                            
request  the Legislature  to  clarify  itself for  the  good of  the                                                            
Court" and thereby "reinstate  the status quo" that the Railroad has                                                            
operated under  since the original  legislation was implemented  18-                                                            
years prior.                                                                                                                    
                                                                                                                                
Mr.  Gamble  declared   that  the  original  bill   enacted  by  the                                                            
Legislature  was  approved  with  the  knowledge  that  federal  law                                                            
exempts  railroads   conducting  interstate   commerce  from   local                                                            
planning  and  zoning  regulations.  He  stated that  that  law  "is                                                            
codified in  federal law and remains  "intact and exists  today." He                                                            
argued that the State's  Supreme Court determination that the intent                                                            
of the Legislature  was unclear is  wrong, as he submitted  that the                                                            
Legislators  "knew what  they were  doing" as attested  by the  fact                                                            
that the bill  has been in effect for 18-years. With  respect to the                                                            
Court,  he  stated that  he  agreed  with "the  three-to  two  hotly                                                            
contested"  minority  decision  of  the  Court,  and  that  the  two                                                            
minority  Court members "were  very pointed"  in their remarks  that                                                            
the federal exemption "as  mirrored by the State" should prevail for                                                            
economic development purposes,"  and that the Railroad, as an entity                                                            
of the State,  should be controlled  by the State rather  than by an                                                            
array  of   differing  local   municipality   planning  and   zoning                                                            
regulations.  Were the Court  ruling to be  upheld, he argued,  this                                                            
kind of local  zoning "control over a State entity"  would result in                                                            
economic  chaos,  as  approval  would be  required  for  each  local                                                            
municipality  case.  The  Court ruling,  he  continued,  would  have                                                            
severe  impact  on  commerce.  He  therefore,   requested  that  the                                                            
Legislature  clarify that  the status quo  mode of operation  should                                                            
continue.                                                                                                                       
                                                                                                                                
Senator  Therriault  supported   the  Railroad's  request  that  the                                                            
Legislature  clarify the intent of  the 18-year old legislation.  He                                                            
voiced  support  for  the  continuance   of the  Railroad's   zoning                                                            
exemption, as  he declared that requiring the Railroad  to adhere to                                                            
13 different  jurisdictional zoning  and planning regulations  would                                                            
create problems. He noted,  however, that Section 1 could be amended                                                            
to address municipalities' concerns.                                                                                            
                                                                                                                                
Senator  Bunde understood  the range  of problems  that might  occur                                                            
were  each municipality's   regulations  a consideration.  He  asked                                                            
regarding  the comment  that  "the Railroad  is a  State agency  and                                                            
should be under State control."                                                                                                 
                                                                                                                                
Mr. Gamble clarified  that the Railroad is a State  instrumentality.                                                            
He voiced that  the Railroad's position is that any  control over an                                                            
instrumentality of the State should be limited to the State.                                                                    
                                                                                                                                
Senator  Olson   pointed  out  that  the  reason  for   the  Court's                                                            
involvement  was due to the  fact that numerous  citizens feel  that                                                            
the Railroad  has been abusing its  authority" in laying  down track                                                            
and acquiring land for  500-foot right of ways without consideration                                                            
for those affected. He  asked how these concerns would be addressed.                                                            
                                                                                                                                
Mr. Gamble  clarified that  a 200-foot  right-of-way is authorized,                                                             
and that most construction  occurs on Railroad property. He informed                                                            
the Committee  that the Railroad  was awarded  36,000 acres  of fee-                                                            
simple property when the  ownership of the Railroad transferred from                                                            
the federal government  to the State. He declared that 80-percent of                                                            
all Railroad  construction  projects encompass  federal funding  and                                                            
therefore,  before  any  work  on those  projects  could  occur,  an                                                            
audited  "extensive community  out-reach"  process  is required  per                                                            
federal  law.  Therefore  he  attested   that  these  projects  have                                                            
"considerable public input."                                                                                                    
                                                                                                                                
Mr. Gamble  noted that  the majority  of the  20-percent balance  of                                                            
Railroad projects, not  supported by federal funding, involves minor                                                            
things  such  as  roof  repair  and  "other  nuts  and  bolts"  non-                                                            
construction  projects.  He  stated that  he  would be  willing  "to                                                            
address specific  cases" in  this regard;  however, he voiced  being                                                            
unaware of any  situation in which the Railroad did  not take public                                                            
concern into consideration.                                                                                                     
                                                                                                                                
Mr. Gamble  acknowledged that public  concern and speculation  could                                                            
occur in regard  to future Railroad  operations such as whether  the                                                            
Railroad  might develop  a gravel  pit in  a suburb  or construct  a                                                            
hotel that would  compete with a another hotel. However,  he assured                                                            
that, were  federal funds  involved in the  development of  a gravel                                                            
pit, it would not be located  near a suburb. He also stated that the                                                            
Alaska  Railroad Board  serves as  one component  of the  Railroad's                                                            
"check and balance  system," and he noted that the  Board's position                                                            
is that  the Railroad  is in  the Railroad  business. Therefore,  he                                                            
noted that  such things as the Railroad  constructing a hotel  would                                                            
not occur,  as it would be outside  of scope of things permitted  by                                                            
the Board. In summary,  he opined that these concerns are addressed.                                                            
                                                                                                                                
Senator Olson  shared that the primary concern he  hears pertains to                                                            
the Railroad track leading  to the Ted Stevens International Airport                                                            
in  Anchorage.  He  stated  that  Railroad  land  in  this  area  is                                                            
"sizable"  and that  it could  be  more appropriately  utilized  for                                                            
other transportation purposes.                                                                                                  
                                                                                                                                
[NOTE: Senator Bunde chaired  the following portion of the meeting.]                                                            
                                                                                                                                
Co-Chair  Green recalled  that the federal  government, rather  than                                                            
the Railroad,  specified the  land around  the Anchorage airport  as                                                            
Railroad  holdings in  order to  address national  airport  security                                                            
concerns.   She   understood   that   the   Alaska   Department   of                                                            
Transportation  and Public Facilities was involved  in this process.                                                            
                                                                                                                                
Senator Olson  voiced appreciate  for this  information as  he could                                                            
now more adequately respond to public concerns.                                                                                 
                                                                                                                                
Amendment  #1: This amendment  deletes the  word "an" in Section  4,                                                            
subsection  (b)  on  page two,  line  31  and replaces  it  with  "a                                                            
binding". Continuing in  subsection (b) on page three, line one, the                                                            
word "will" is  deleted and replaced with "shall";  and on that same                                                            
line, "in the judgment  of the corporation" is deleted. Also on that                                                            
same line, "consideration"  is deleted and replaced  with "revenue".                                                            
The amended language would read as follows.                                                                                     
                                                                                                                                
     (b) Before issuing  bonds to provide the financing described in                                                            
     this section, the  Alaska Railroad Corporation shall enter into                                                            
     a  binding agreement  with the  United States  government  that                                                            
     shall provide sufficient revenue to…                                                                                       
                                                                                                                                
Senator  B. Stevens  moved to adopt  Amendment #1  and objected  for                                                            
explanation.                                                                                                                    
                                                                                                                                
Senator B. Stevens  stated that this amendment would  eliminate some                                                            
ambiguity in the language  and would clarify the intent of the bill.                                                            
                                                                                                                                
Mr.  Gamble  stated  that  the  Railroad  does  not  object  to  the                                                            
amendment.                                                                                                                      
                                                                                                                                
Senator  Therriault  stated  that  this  amendment  would  serve  to                                                            
alleviate some concerns.                                                                                                        
                                                                                                                                
Senator B. Stevens removed his objection.                                                                                       
                                                                                                                                
There being no further objection, Amendment #1 was ADOPTED.                                                                     
                                                                                                                                
SARA HEIDEMAN, Attorney  representing the Native Village of Eklutna,                                                            
testified  via  teleconference   from  Anchorage  in  opposition  to                                                            
Section 1 of the bill.  She noted that the Village takes no position                                                            
on Section 2.                                                                                                                   
                                                                                                                                
Ms.  Heideman   informed  the  Committee   that  another   component                                                            
incorporated in  the aforementioned State Supreme  Court case is the                                                            
"balancing of interest  test," which is a test that has been adopted                                                            
by  the  majority  of national  courts  "to  address  the  issue  of                                                            
governmental immunity from  zoning in the last 30 years." She stated                                                            
that this test  has enhanced the public input process  in regards to                                                            
zoning. She respectfully  disagreed with Mr. Gamble  that the intent                                                            
of Alaska Statute  AS 42.40 is clear  as she argued that  sufficient                                                            
testimony regarding  the adoption  of this Statute did not  indicate                                                            
that all Railroad land  would be exempt from local zoning authority.                                                            
Continuing, she  noted that the Legislature could  have specifically                                                            
included exemption  language in the  Statute at the time,  but chose                                                            
not to.                                                                                                                         
                                                                                                                                
Ms.  Heideman   stated   that  the  federal   "Interstate   Commerce                                                            
Commission  Termination Act" referred  to by Mr. Gamble "abolished"                                                             
the Interstate  Commerce Commission  (ICC), "placed restrictions  on                                                            
State  and local regulation  of  railroads and  created the  Surface                                                            
Transportation  Board." She stated that this federal  law specifies,                                                            
"that   State   and   local   economic   regulations   which   would                                                            
significantly  interfere with core  rail operations is prohibited."                                                             
The meaning  of this law,  she continued, is  that any attempt  by a                                                            
State or local  government to prevent  the operation, construction,                                                             
or the discontinuance of  a rail line would be prohibited by federal                                                            
law. Therefore,  she explained that no local entity  could block the                                                            
construction of a rail  line to Fort Greely or regulate the track as                                                            
it  transits   from  jurisdiction   to  jurisdiction.  She   stated,                                                            
therefore, that the Railroad  is protected by federal law as well as                                                            
by the balancing  test that was utilized  by the Supreme  Court. She                                                            
reiterated  that  an extension  of  a  line,  placement of  a  line,                                                            
whether to  discontinue a line, the  location of a train  depot, and                                                            
other  core things  would be  protected  by federal  law, and  would                                                            
therefore not require the balancing test to be put into place.                                                                  
                                                                                                                                
Ms.  Heideman stressed  therefore,  that,  "there is  a very  finite                                                            
field within  which local governments  could regulate in  regards to                                                            
the Railroad." This narrow  field, she attested is that to which the                                                            
balancing  test could  be applicable.  She stated  that the  Court's                                                            
implementation  of this test "is very fair to everyone,"  in that it                                                            
would  require  the  Railroad  "to comply  with  local  zoning  when                                                            
compliance would not create a hardship for it…"                                                                                 
                                                                                                                                
                                                                                                                                
SFC 04 # 105, Side B 09:54 AM                                                                                                   
                                                                                                                                
                                                                                                                                
Ms. Heideman  reminded the  Committee that  Alaska Statute  Title 35                                                            
mandates that,  in a similar fashion  to the federal ruling  for the                                                            
railroad,  the  Alaska  Department  of  Transportation   and  Public                                                            
Facilities  must comply with  local zoning  ordinances but  would be                                                            
immune from local zoning ordinances "in appropriate cases."                                                                     
                                                                                                                                
Ms. Heideman  stressed  that under  the balancing  test guidelines,                                                             
public and local officials  are able to have input, in limited areas                                                            
that "are not pre-empted  by federal law" in regard to the essential                                                            
operation of the Railroad.                                                                                                      
                                                                                                                                
Ms. Heideman  declared that were Section  1 adopted, it would  serve                                                            
to "eliminate  all public input, all  input from local governments,                                                             
and eliminate  any  need for Railroads  to consider  any  legitimate                                                            
public  or  local  interest."  In addition,  she  pointed  out  that                                                            
immunity from  local government zoning  is not required in  order to                                                            
operate  a railroad.  She  noted that  nationally,  the majority  of                                                            
railroad  ownership   is  private,  and  she  stressed   that  these                                                            
companies are  not immune from local zoning ordinances  and continue                                                            
to operate within and across multiple state lines.                                                                              
                                                                                                                                
Ms. Heideman declared that  Section 1 would change "a system that is                                                            
not  broken"  and  would  deny  public  and  local  government  from                                                            
infusing legitimate input. She urged that Section 1 be deleted.                                                                 
                                                                                                                                
Co-Chair Green  asked for further  clarification of language  on the                                                            
testifier's  handout titled "Historical  Statement by Sara  Heideman                                                            
(Hedland,  Brennan, &  Heideman) [copy  on file];  specifically  the                                                            
language located in the last paragraph that reads as follows.                                                                   
                                                                                                                                
     It requires  the railroad to  comply with local zoning  when it                                                            
     can do so  without hardship. It permits the railroad  to obtain                                                            
     immunity  from local zoning when  local zoning would  interfere                                                            
     with its operations.                                                                                                       
                                                                                                                                
Ms. Heideman  commented  that the  balancing test  would be  applied                                                            
were the Railroad to seek  immunity from a local zoning requirement,                                                            
after the Railroad  made an attempt  to comply with local  zoning by                                                            
going to the local  planning and zoning commission  and applying for                                                            
a conditional  use permit. Were this the case, the  Court, she noted                                                            
would  seek to  balance the  public's  and Railroad's  interest  and                                                            
determine whether  any local interference  with Railroad  operations                                                            
might  incur.  She stated  that  were the  Railroad's  interests  to                                                            
outweigh  the others, it  would prevail in  being immune from  local                                                            
zoning. She  shared that the balancing  test evolved from  a case in                                                            
New Jersey  in which a  state university  attempted to place  multi-                                                            
family housing in a community  in which that zoning was not allowed.                                                            
She stated  that, in that  case, it was  determined that abiding  by                                                            
local ordinance  would hinder  the function  of the university,  and                                                            
the university was granted  immunity. Therefore, she continued, were                                                            
the Railroad to  prove that abiding by local ordinance  would hinder                                                            
its ability  to perform  an essential  State function,  it would  be                                                            
granted immunity.                                                                                                               
                                                                                                                                
Co-Chair Green  understood that the balancing test  would be applied                                                            
by the  Superior Court, and  therefore, she  asked whether  the non-                                                            
prevailing  party could  appeal the  immunity  determination to  the                                                            
Supreme Court.                                                                                                                  
                                                                                                                                
Ms.  Heideman  stated that  either  side  could appeal  the  ruling.                                                            
Continuing,  she  noted  that  in a  situation  where  the  Railroad                                                            
prevailed, "it would not  likely be hindered in its operation unless                                                            
the opposing  party could, during  the appeal process, show  that it                                                            
could  likely prevail  on the  appeal or"  the opposing  side  could                                                            
prove it had the economic means with which to post a bond.                                                                      
                                                                                                                                
[NOTE: Co-Chair Wilken resumed chair of the Committee.]                                                                         
                                                                                                                                
RON  LONG  testified  via teleconference   from Seward  on  his  own                                                            
behalf. He voiced support  for Section 2, as it is, he declared, "an                                                            
exciting project."  In addressing  Section 1, he stated that,  while                                                            
"the  need for  consistency  across  jurisdictional  boundaries  for                                                            
rights of way"  might supersede those  of local planning  and zoning                                                            
commissions,   it  is   important   to  recognize   the  rights   of                                                            
municipalities   pertaining   to  planning   and  zoning   ordinance                                                            
variances  as outlined in  Title 29. This  direction, he  continued,                                                            
would  allow the  Railroad's  essential services  to  be weighed  in                                                            
relation to municipality  interests. He stated that a process should                                                            
be  developed  that  would consider  the  Railroad's  right  of  way                                                            
interests as  opposed to its real  estate development interests.  He                                                            
pointed out  that a recent Department  of Transportation  and Public                                                            
Facilities  (DOTPF) right-of-way  model  exemption  would be a  good                                                            
model as it  addresses federal, State,  and local discrepancies  and                                                            
incongruities.                                                                                                                  
                                                                                                                                
Co-Chair   Wilken  stated   that,  in  his   view,  Section   1  "is                                                            
problematic." Therefore,  he noted that the Committee has the option                                                            
of adopting the  original version of the bill that  does not include                                                            
Section 1 with  the understanding  that legislation addressing  that                                                            
issue could be considered early in the next Legislative session.                                                                
                                                                                                                                
Mr.  Gamble stated  that,  as per  the recent  Court  ruling in  the                                                            
Eklutna  case,   the  Railroad  would  be  required   to  acquire  a                                                            
conditional use  permit for each forthcoming project  that affects a                                                            
municipality  and, were the  local planning  and zoning commissions                                                             
conditions  not deemed to be in the  best interest of the  Railroad,                                                            
would  be required  to litigate  each case utilizing  the  balancing                                                            
test. This,  he shared, would serve  to delay the process  on a case                                                            
to case basis on "the entirety  of the line." Continuing he attested                                                            
that, in addition  to requiring municipalities  and the Railroad  to                                                            
agree on a project, the  Court ruling has "opened the door" to allow                                                            
private individuals or  private group to challenge a permit. He also                                                            
commented that  "tying up a case"  via challenges and appeals  "is a                                                            
tactic" utilized  by various groups. He reiterated  that in addition                                                            
to the length  of time required to  conduct the permit process,  the                                                            
litigation process would  serve to further delay a project. He noted                                                            
that the Court ruling is not retroactive.                                                                                       
                                                                                                                                
Co-Chair Wilken, while  being sympathetic to the Railroad's concerns                                                            
as he recalled  the delay  experienced by  the Pogo Mine  operations                                                            
due to "tactics;"  voiced concern regarding balancing  "the needs of                                                            
the Railroad against the  responsibilities of our assemblies to have                                                            
planning" in today's environment and in the future.                                                                             
                                                                                                                                
Co-Chair Wilken referenced  a suggestion of the Fairbanks North Star                                                            
Borough Mayor,  Jim Whitaker,  in his letter  [copy on file]  to Co-                                                            
Chair Wilken,  dated May 3, 2004 in which he proposed  language that                                                            
would read as follows.                                                                                                          
                                                                                                                                
     (c) By January  10 if each year, the corporation  shall provide                                                            
     notice to municipalities  of any new land use proposed for that                                                            
     year  by  the  corporation  within  municipal  boundaries.  The                                                            
     corporation  shall provide  amended notice  if a proposed  land                                                            
     use  is changed or an  additional land  use is proposed  during                                                            
     the course  of the year. Except  in the event of an  emergency,                                                            
     an affected municipality  shall have at least 30 days after its                                                            
     receipt  of  the notice  to  provide  advisory comment  to  the                                                            
     corporation.  In the  event of  an emergency,  the corporation                                                             
     will provide notice  to an affected municipality promptly after                                                            
     the event.                                                                                                                 
                                                                                                                                
Co-Chair  Wilken opined that  the suggestion  that a community  task                                                            
force  be involved  in the  process might  indicate  that more  time                                                            
should be required  to address this  situation. He noted  that other                                                            
communities such  as the Matanuska-Susitna Borough  have also voiced                                                            
concern regarding Section  1. Therefore, he reiterated that in order                                                            
to provide  communities  and the  railroad proper  consideration  in                                                            
this matter, Section 1  should be addressed separately the following                                                            
Legislative session.                                                                                                            
                                                                                                                                
Co-Chair  Green  suggested  that  the  incorporation  of  precedent-                                                            
setting  litigation  rulings  that could  not  be reversed  and  the                                                            
establishment  of a more  rigorous permitting  process might  assist                                                            
this matter.  She asked whether there  is any "logical distinction"                                                             
between  Railroad operations  and  its real  estate  holding as  she                                                            
opined  that the real  estate holding  usage,  rather than  railroad                                                            
operation projects, are the underlying issue.                                                                                   
                                                                                                                                
Mr. Gamble responded that  determining the boundary lines in regards                                                            
to  these  two issues  "is  a  real  interesting  question,"  as  he                                                            
continued  that since  the  recent Court  ruling,  the Railroad  has                                                            
noticed that  the vast majority of  the issues pertain to  land use.                                                            
He stated that  the determination regarding separation  between land                                                            
use and operations could  be very controversial and subjective. This                                                            
he  continued  is  exampled  by  the  controversy   surrounding  the                                                            
Anchorage  Ship Creek  railroad  land  wherein the  Municipality  of                                                            
Anchorage's  planning  and zoning  commission  requirements  specify                                                            
that a certain  type of landscaping  scheme, including the  planting                                                            
of trees, must  be in place. In this regard, he explained  that were                                                            
trees planted  per commission's instructions, they  would negatively                                                            
impact  the operational  ability  of  the  crew manning  the  line's                                                            
observation  tower. Furthermore,  he shared  that when the  Railroad                                                            
requested  a waiver regarding  this issue,  the municipality  denied                                                            
one. He stated  that were every project  required to address  things                                                            
of this nature,  it would be very time consuming.  He concluded that                                                            
this situation signifies the intent of the original exemption.                                                                  
                                                                                                                                
Senator  Therriault pointed  out that  this example  applies to  the                                                            
development  of a  piece of  Railroad land  that would  be used  for                                                            
operational purposes.                                                                                                           
                                                                                                                                
Senator Therriault pointed  out that language in Section 1, lines 11                                                            
and 12  specifies that any  Railroad land  leased to another  entity                                                            
would not be  provided the Railroad  exemption and would  be subject                                                            
to local planning and zoning  requirements. He noted that leasing of                                                            
Railroad land is a revenue generating mechanism.                                                                                
                                                                                                                                
Mr. Gamble clarified that  land leased in this fashion today, is not                                                            
subject to the Railroad exemption.                                                                                              
                                                                                                                                
Senator  Therriault   stated  that   the  aforementioned   amendment                                                            
suggested by the  Mayor of Fairbanks is acceptable  to the Railroad,                                                            
even thought the  Mayor's letter states that the Railroad  disagrees                                                            
with it.                                                                                                                        
                                                                                                                                
Mr. Gamble voiced  that the Railroad's comments in  this regard were                                                            
taken out on context.                                                                                                           
                                                                                                                                
Co-Chair Wilken stated that this would be clarified.                                                                            
                                                                                                                                
Senator Olson  asked the number of  Railroad projects that  would be                                                            
negatively impacted were Section 1 removed from the bill.                                                                       
                                                                                                                                
Mr. Gamble  responded that  a borough-by-borough  analysis  would be                                                            
required to answer  that question; however, he noted  that there are                                                            
approximately 113 projects  under consideration. He stated that this                                                            
information would be forthcoming.                                                                                               
                                                                                                                                
Co-Chair  Wilken  stated   that  the  struggle  with  Section  1  is                                                            
acerbated  by the  upcoming Legislative  Session  adjournment  date,                                                            
which, he declared,  does not provide  significant time to  properly                                                            
address the issue. He noted  that the Mat-Su and Kenai Boroughs have                                                            
evening  meetings planned  to  discuss this  issue,  and that  their                                                            
feedback would be helpful.  He suggested that a committee substitute                                                            
be developed  that might eliminate  Section 1 from consideration  at                                                            
this time.                                                                                                                      
                                                                                                                                
Senator  Dyson encouraged  the  Committee  to consider  a  committee                                                            
substitute that  would, rather than omitting Section  1, limit it to                                                            
specific "high priority" projects.                                                                                              
                                                                                                                                
Co-Chair  Wilken stated  that  the intent  would be  to protect  the                                                            
Railroad until  due consideration could be provided.  He opined that                                                            
perhaps a termination date  or other measure would be appropriate at                                                            
this time.                                                                                                                      
                                                                                                                                
Senator  Therriault stated  that the  adoption  of Mayor  Whitakers'                                                            
language suggestion or  a termination date in this legislation might                                                            
increase  the  Committee's  "comfort level"  without  hindering  the                                                            
Railroad's ability to operate.  This action, he continued would also                                                            
provide time to develop  alternate language that could be considered                                                            
during the next Legislation Session.                                                                                            
                                                                                                                                
Co-Chair  Wilken ordered  the  bill HELD  in Committee  in order  to                                                            
develop a committee substitute  that could serve as "a bridge during                                                            
this press of  time." He reiterated his concern about  the long-term                                                            
affects  of  any   action  taken  because  the  language   "is  very                                                            
explicit." He noted that  the Railroad's position as stated in Mayor                                                            
Whitaker's would be further clarified.                                                                                          
                                                                                                                                
                                                                                                                                
     SENATE RESOLUTION NO. 3                                                                                                    
     Relating to commemoration of Senator Frank R. Ferguson and                                                                 
     other distinguished Senators.                                                                                              
                                                                                                                                
                                                                                                                                
This  was the  second  hearing for  this  resolution  in the  Senate                                                            
Finance Committee.                                                                                                              
                                                                                                                                
Co-Chair Wilken asked the  Resolution's sponsor to address Committee                                                            
concerns  regarding  the proposed  location  of the  plaque and  the                                                            
nomination  process  through  which  names  could  be added  in  the                                                            
future.                                                                                                                         
                                                                                                                                
Senator Olson, the Resolution's  sponsor, noted that this Resolution                                                            
would  honor   Senators  by   having  their   name  included   on  a                                                            
commemorative plaque that  would be placed in the Capitol. He stated                                                            
that  the  plaque  would  be an  alternative  to  naming  rooms  and                                                            
buildings after legislators  due to the fact that there are a finite                                                            
number  of such  places available.  He  provided an  example of  the                                                            
plaque [copy on file].                                                                                                          
                                                                                                                                
Co-Chair Wilken reminded  the Committee that Amendment #2, which was                                                            
previously  adopted, would omit the  words "wall outside  the Senate                                                            
Finance  Committee  Room" and  insert the  words  "place inside  the                                                            
Capitol Building"  after the word  "prominent" on page two,  line 24                                                            
of the Resolution.                                                                                                              
                                                                                                                                
Amendment  #3: This  amendment  inserts  the words  "resolution  of"                                                            
following "by"  on page two, line 25. Therefore, with  the inclusion                                                            
of Amendment #2, this language would read as follows.                                                                           
                                                                                                                                
     BE IT RESOLVED by  the Alaska State Senate that a commemorative                                                            
     panel  be established at a prominent  place inside the  Capitol                                                            
     Building  for  the  listing   of Senators   who  are  specially                                                            
     recognized  by resolution  of the Alaska  State Senate  for the                                                            
     value  of their contributions  to he  Alaska State Legislature                                                             
     and the people of Alaska; and be it                                                                                        
                                                                                                                                
Co-Chair Wilken moved to adopt Amendment #3.                                                                                    
                                                                                                                                
Co-Chair Green objected for explanation.                                                                                        
                                                                                                                                
Co-Chair Wilken  explained that this  language would allow  the bill                                                            
to be considered  a "simple resolution"  under Legislative  Rule 49,                                                            
which allows  a resolution  to be  approved by  either the House  of                                                            
Representatives  or the  Senate without  requiring concurrence  from                                                            
the other body.                                                                                                                 
                                                                                                                                
Senator Olson voiced support for the Amendment.                                                                                 
                                                                                                                                
Co-Chair Green removed her objection.                                                                                           
                                                                                                                                
There being no further objection, Amendment #3 was ADOPTED.                                                                     
                                                                                                                                
Amendment #4:  This amendment inserts  the word "posthumously"  into                                                            
the bill on  page three, line 25,  following the word "recognized".                                                             
                                                                                                                                
Senator Olson moved to adopt Amendment #4.                                                                                      
                                                                                                                                
There being no objection, Amendment #4 was ADOPTED.                                                                             
                                                                                                                                
Senator  Olson moved  to report  the  Resolution,  as amended,  from                                                            
Committee with  individual recommendations  and accompanying  fiscal                                                            
notes.                                                                                                                          
                                                                                                                                
There being no objection,  CS SR 3 (FIN) was REPORTED from Committee                                                            
with zero fiscal  note #1 from the Legislative Council,  Legislative                                                            
Affairs Agency, dated March 8, 2004.                                                                                            
                                                                                                                                
                                                                                                                                
     CS FOR SENATE BILL NO. 224(STA)                                                                                            
     "An  Act  relating  to  a  minor  operating   a  vehicle  after                                                            
     consuming  alcohol, to a minor  refusing to submit to  chemical                                                            
     tests,  and to driving  during the 24  hours after being  cited                                                            
     for  one of  those offenses;  and  providing  for an  effective                                                            
     date."                                                                                                                     
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair Wilken noted that  the Senate State Affairs (STA) committee                                                            
substitute,  Version 23-LS1037\B,  would stiffen  the penalties  and                                                            
fines for minors, those  under the age of 21, who drive while having                                                            
a blood alcohol  content (BAC) of .02 or higher. He  stated that ten                                                            
fiscal notes accompany the bill.                                                                                                
                                                                                                                                
RICHARD SCHMITZ, Staff  to Senator John Cowdery, the bill's sponsor,                                                            
commented that this legislation  was developed to address situations                                                            
in which  minors consume  alcohol and drive.  Continuing, he  stated                                                            
that minors who consume  alcohol and drive with a BAC of .02 percent                                                            
or higher would  be charged with an infraction whereas  individuals,                                                            
age 21  and older who  drive with  a BAC of  .08 percent or  higher,                                                            
would  be   charged  with   Driving  While   Intoxicated  (DWI),   a                                                            
misdemeanor.  He stated  that  under this  bill,  minors would  also                                                            
receive  mandatory community  service  time and  increased fines  at                                                            
three separate levels dependent  on whether the offense is repeated.                                                            
He stated that  this legislation would acknowledge  federal law that                                                            
does not  allow minors  to be  incarcerated for  "a status  offense"                                                            
which is an offense  that, dependent on your age,  would be legal or                                                            
illegal. DWI, he stated  is a "status offense" in that it is illegal                                                            
for a 20-year old to consume  alcohol, but is legal once that person                                                            
turns 21 years of age.                                                                                                          
                                                                                                                                
Co-Chair Wilken  asked whether the  Sponsor Statement is  applicable                                                            
to Version "B."                                                                                                                 
                                                                                                                                
Mr. Schmitz responded  that the Sponsor Statement  is not current as                                                            
it refers  to the proposed  penalty as being  a Class B Misdemeanor                                                             
rather than an infraction  as specified in the Version "B" committee                                                            
substitute.                                                                                                                     
                                                                                                                                
Co-Chair  Wilken   asked  that  an  updated  Sponsor   Statement  be                                                            
provided.                                                                                                                       
                                                                                                                                
CINDY  CASHEN, Executive  Director,  Mothers Against  Drunk  Driving                                                            
(MADD), Juneau  Chapter, spoke  on behalf of  Juneau and four  other                                                            
State MADD chapters. She  noted that, in this situation and contrary                                                            
to MADD's traditional  position of supporting Misdemeanor  penalties                                                            
for DUIs, MADD  supports the proposed infraction penalty  because of                                                            
the community  work service and fine structure that  accompanies the                                                            
bill.  She  noted  that a  result  of  law  enforcement  efforts  to                                                            
apprehend more  people who drive while  intoxicated, there  has been                                                            
an increase  in the number of arrests  of minors operating  vehicles                                                            
after consuming  (MOVAC).  Court monitoring  conducted by MADD,  she                                                            
noted, has  observed that this increase  in DUI cases has  created a                                                            
bottleneck in  the Court System, which has "unfortunately"  resulted                                                            
in numerous  MOVAC arrests being delayed,  pled down, or  dismissed,                                                            
and the  process, she attested,  has become  considered "a  joke" by                                                            
teenagers and  has not served as an  incentive to stop drinking  and                                                            
driving. She  stressed that the sooner  the Court processes  MOVACs,                                                            
the better,  as  the youth,  at that  time, "are  more contrite  and                                                            
aware of they  did screw up, and that  they need to figure  out what                                                            
they need to do in the future."                                                                                                 
                                                                                                                                
Ms. Cashen  stated that by "substantially"  increasing the  fine and                                                            
requiring community work  service, this bill would be effective. She                                                            
noted that  community work service  has seldom been required  in the                                                            
past; however,  she opined that it would make a difference  and that                                                            
this legislation  would move the MOVACs  through the system  faster.                                                            
                                                                                                                                
Senator  Bunde  asked  whether  the  increased   fine  levels  would                                                            
generate  sufficient  revenue  to  warrant  the  increased  expenses                                                            
reflected in the Public Defenders Agency fiscal note.                                                                           
                                                                                                                                
Ms. Cashen responded  that youth currently have a  right to a Public                                                            
Defender; therefore,  she declared  that MADD does not believe  that                                                            
this bill would  incur additional expense to the Agency  as "nothing                                                            
is going to change."                                                                                                            
                                                                                                                                
Co-Chair Wilken asked the  Agency to expound on the need to increase                                                            
Public Defender Agency staff by one.                                                                                            
                                                                                                                                
BARBARA  BRINK,  Director,  Public Defender  Agency,  Department  of                                                            
Administration,  testified  via teleconference  from an offnet  site                                                            
and commented that the  Agency's fiscal note was calculated based on                                                            
Division  of Motor Vehicles'  projections of  minor drivers  who are                                                            
"processed  for administrative  driver license  revocations  who are                                                            
not  currently  charged   with  operating  a  motor  vehicle   after                                                            
consuming."  "Respectfully disagreeing"  with the sponsor  and MADD,                                                            
she stressed  that this is a criminal  offense and that classifying                                                             
it as an infraction  rather than a misdemeanor would  not negate the                                                            
need for a jury  council or legal counsel. Continuing,  she stressed                                                            
that additional  staff  would be required  as an  increase in  cases                                                            
involving juveniles  charged with  these offenses would result.  She                                                            
also noted that District  Court judges rather than magistrates would                                                            
be  required  to hear  these  cases, and  she  stressed  that it  is                                                            
difficult to predict how many cases would be processed.                                                                         
                                                                                                                                
Ms.  Brink agreed  that  the  increased penalties  would  assist  in                                                            
decreasing the  number of minors who choose to drink  and drive. She                                                            
clarified  for  the Committee  that  any  minor with  a  BAC of  .08                                                            
percent  or  higher   would  be  charged  with  Driving   Under  the                                                            
Influence. She reminded  the Committee that the Agency experienced a                                                            
tremendous caseload increase  when the penalties for Minor Consuming                                                            
(MC) were increased  several years ago. She stated  that, while this                                                            
bill would be effective, "Justice comes at a price."                                                                            
                                                                                                                                
Ms. Cashen  reiterated  that rather  than increasing  the number  of                                                            
youth  processed  for  MOVAC,  this  legislation  would  move  those                                                            
charged through the system  quicker, and as a result, would make the                                                            
process "easier."                                                                                                               
                                                                                                                                
Co-Chair  Wilken thanked MADD  for the efforts  it exerts  regarding                                                            
drunk driving issues.                                                                                                           
                                                                                                                                
AT EASE 10:39 AM / 10:40 AM                                                                                                     
                                                                                                                                
DON SMITH,  Administrator,  Alaska Highway  Safety Office,  spoke in                                                            
support of the bill.                                                                                                            
                                                                                                                                
Co-Chair  Green  moved  to  report  the  bill  from  Committee  with                                                            
individual recommendations and accompanying fiscal notes.                                                                       
                                                                                                                                
There  being  no  objection,  CS  SB  224(STA)   was  REPORTED  from                                                            
Committee with  zero fiscal note #5,  dated April 27, 2004  from the                                                            
Department  of Public Safety;  indeterminate  fiscal note #6,  dated                                                            
April 28, 2004  from the Alaska Court  System; zero fiscal  note #7,                                                            
dated  April 28,  2004  from the  Department  of Health  and  Social                                                            
Services;  zero  fiscal note  #8,  stated April  29,  2004 from  the                                                            
Division   of  Motor   Vehicles,   Department   of  Administration;                                                             
indeterminate  fiscal note #9, dated April 29, 2004  from the Office                                                            
of  Public Advocacy,  Department  of  Administration;  and  $134,700                                                            
fiscal  note #10,  dated April  28, 2004  from the  Public  Defender                                                            
Agency, Department of Administration.                                                                                           
                                                                                                                                
                                                                                                                                
     SENATE CS FOR CS FOR HOUSE BILL NO. 93(TRA)                                                                                
     "An Act relating to boating safety, registration, and                                                                      
     numbering; extending the sunset date of changes in ch. 28, SLA                                                             
     2000; and providing for an effective date."                                                                                
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair  Wilken  noted that  the  Senate Transportation   Committee                                                            
committee  substitute,  Version 23-LS0230\U,  and  its accompanying                                                             
fiscal  notes would  serve to  extend the  termination  date of  the                                                            
Alaska Boating  Safety Act  from 2005 to 2010  and would remove  the                                                            
registration requirement for non-motorized vessels.                                                                             
                                                                                                                                
LINDA  SYLVESTER,  Staff  to  Representative  Bruce  Weyhrauch,  the                                                            
bill's  sponsor,  stated  that this  legislation  would  extend  the                                                            
termination  date  of the  boating  registration  program  that  was                                                            
implemented in the year  2000. She noted that a termination date was                                                            
attached to  the original legislation  due to concern as  to whether                                                            
or  not  the   federal  funds  the   program  attracted   "might  be                                                            
continuous."   She  informed  that   Committee  that  there   is  no                                                            
indication  that  these federal  funds,  which  are drawn  from  the                                                            
Wallace Wallop-Breaux Trust Fund, would terminate.                                                                              
                                                                                                                                
Ms. Sylvester  informed the Committee  that the original  version of                                                            
this  bill  eliminated  the termination  date  section;  however,  a                                                            
termination  date was included in  the committee substitute  adopted                                                            
by the Senate Transportation  Committee (TRA). Continuing, she noted                                                            
that after discussions  in regarding the statewide controversy about                                                            
requiring non-motorized  boats to  register, the Senate TRA  decided                                                            
to exempt all non-powered boats from the requirement.                                                                           
                                                                                                                                
                                                                                                                                
SFC 04 # 106, Side A 10:43 AM                                                                                                   
                                                                                                                                
                                                                                                                                
Ms.  Sylvester  noted  that  the  TRA  version  of the  bill  is  in                                                            
compliance with federal  law, which requires motorized vessels to be                                                            
registered, and  she spoke of the sponsor's desire  that the program                                                            
continue.                                                                                                                       
                                                                                                                                
Co-Chair  Wilken noted that  a representative  of the Department  of                                                            
Health and Social Services  is present to answer questions pertinent                                                            
to that Department. He  voiced the understanding that the Department                                                            
supports the bill.                                                                                                              
                                                                                                                                
Senator  Dyson shared  that he  is a  member of  the Boating  Safety                                                            
Council. He voiced  appreciation for the registration  exemption for                                                            
non-powered vessels as  specified in Section 2, subsection (i)(4) on                                                            
page two, line 12 that reads as follows.                                                                                        
                                                                                                                                
     (4) a boat that is not equipped with mechanical propulsion [,                                                              
     THAT IS EXCLUSIVELY PADDLED, POLED, ROWED, OR POWERED BY WIND,                                                             
     AND THAT IS                                                                                                                
     (a) UNDER 10 FEET IN LENGTH; OR                                                                                            
     (b) OPERATED IN THIS STATE FOR A PERIOD NOT EXCEEDING 30 DAYS                                                              
     IN A CALENDAR YEAR BY A PERSON WHO HAS NOT ESTABLISHED                                                                     
     RESIDENCY AS DESCRIBED UNDER AS 01.10.055];                                                                                
                                                                                                                                
     New Text Underlined [DELETED TEXT BRACKETED]                                                                             
                                                                                                                                
Senator Dyson suggested  that the word "mechanical" be replaced with                                                            
the word "powered"  as he is concerned the term mechanical  could be                                                            
confusing as such things  as mechanically powered peddle-boats might                                                            
be viewed as requiring registration.                                                                                            
                                                                                                                                
SUE HARGIS,  Boating Safety  Specialist, United  States Coast  Guard                                                            
(USCG),   responded  that   peddle-boats  are   not  recognized   as                                                            
mechanically  propelled by  the federal  government. Therefore,  she                                                            
stated that this  should not be a concern because  the USCG conducts                                                            
the  training  of  the State  Troopers  who  would  be  involved  in                                                            
enforcing the law.                                                                                                              
                                                                                                                                
Senator Dyson acknowledged.                                                                                                     
                                                                                                                                
Senator Dyson regarded  the language in Section 2, subsection (i)(6)                                                            
on page two, line 22 to  be redundant in that its specific reference                                                            
to "umiaqs," is  unnecessary as he viewed those vessels  to exempted                                                            
by the language in Section 2, subsection (i)(4).                                                                                
                                                                                                                                
     (6) a handmade non-motorized umiaq with a walrus or sealskin                                                               
     covering.                                                                                                                  
                                                                                                                                
Ms.  Sylvester  concurred.   Continuing,  she  noted  that  the  TRA                                                            
committee  adopted  an amendment  sponsored  by Senator  Olson  that                                                            
incorporated the  umiaq reference into the bill, and  she noted that                                                            
this is the first time  in Alaska record that umiaqs, which could be                                                            
powered by motors, are referenced in legislation.                                                                               
                                                                                                                                
Senator Dyson  understood; however, asked why such  things as kayaks                                                            
were not also included.                                                                                                         
                                                                                                                                
Ms. Sylvester  agreed that it is redundant. In order  to address the                                                            
reason for the inclusion  of umiags, she informed the Committee that                                                            
according  to USCG regulations,  all undocumented  vessels  equipped                                                            
with  propulsion  machinery  must  be registered   in the  State  of                                                            
principal use.  This, she stressed,  is the intent of this  program.                                                            
                                                                                                                                
Senator  Dyson announced  that his  vessels would  become  compliant                                                            
were this bill adopted.                                                                                                         
                                                                                                                                
JACK  CADIGAN,  Captain,  United States  Coast  Guard  Retired,  and                                                            
Representative, United  States Coast Guard Auxiliary, stated that he                                                            
was available for questions.                                                                                                    
                                                                                                                                
Ms.  Hargis,  on   behalf  of  the  USCG,  thanked   the  State  for                                                            
implementing  the Boating  Safety Program  in 2000.  She noted  that                                                            
Alaska was the last of  the fifty states to implement such a program                                                            
and as a result,  benefited from other  states' experiences  and has                                                            
become one  of the leaders in such  things as educational  programs.                                                            
She affirmed that  the termination date, which would  be extended by                                                            
this  bill,  was  originally  included  to  address  the  continuous                                                            
funding concern.                                                                                                                
                                                                                                                                
Ms.  Hargis noted  that  while the  USCG  is typically  involved  in                                                            
boating  safety issues  when  there is  the  need for  a Search  and                                                            
Rescue operation,  this legislation  allows the USCG to be  involved                                                            
at the educational level  and in that regard, could assist in saving                                                            
lives that otherwise might be lost.                                                                                             
                                                                                                                                
Senator Olson suggested  that the words "internal combustion engine"                                                            
as  opposed  to the  "less  vague  mechanical  propulsion"  term  be                                                            
utilized, were clarification on this issue desired.                                                                             
                                                                                                                                
Ms. Hargis  clarified that  the term "mechanical  propulsion"  would                                                            
serve to include electric engines.                                                                                              
                                                                                                                                
Senator Dyson  expounded that "all  definitions are problematic"  as                                                            
exampled  by the fact  that steam  engines are  external  combustion                                                            
engines.                                                                                                                        
                                                                                                                                
Senator   Olson  asked  the   consequence   of  not  adopting   this                                                            
legislation.                                                                                                                    
                                                                                                                                
Ms. Sylvester  responded that the program would terminate;  and as a                                                            
result  Alaska  would loose  federal  funding  that is  utilized  to                                                            
support  educational  programs. She  noted  that were  the State  to                                                            
desire  to continue  any of  these  programs, general  fund  support                                                            
would be required  to replace those  funds. In addition,  she noted,                                                            
that the boat  registration process  and the revenue generated  from                                                            
those registrations would revert back to the federal government.                                                                
                                                                                                                                
Ms.  Hargis  noted  that  while  the registration   component  would                                                            
continue  as a  federal program,  the benefits  to  the State  would                                                            
dissipate.                                                                                                                      
                                                                                                                                
Co-Chair Wilken  disclosed his involvement in an organization  that,                                                            
as  a result  of  the  programs  supported  by  the  Boating  Safety                                                            
Program, provides life jackets to youth in the Fairbanks area.                                                                  
                                                                                                                                
Co-Chair Wilken ordered the bill HELD in Committee.                                                                             
                                                                                                                                
[NOTE: This bill was readdressed after the Recess.]                                                                             
                                                                                                                                
RECESS TO THE CALL OF THE CHAIR 10:53 AM / 2:50 PM                                                                              
                                                                                                                                
                                                                                                                                
     SENATE CS FOR CS FOR HOUSE BILL NO. 93(TRA)                                                                                
     "An Act relating to boating safety, registration, and                                                                      
     numbering; extending the sunset date of changes in ch. 28, SLA                                                             
     2000; and providing for an effective date."                                                                                
                                                                                                                                
                                                                                                                                
[NOTE: This  bill was heard  earlier in the  meeting, just  prior to                                                            
the 10:53 AM RECESS.]                                                                                                           
                                                                                                                                
JENNIFER YUHAS,  Executive Director,  Alaska Outdoor Council  (AOC),                                                            
testified via teleconference  from an offnet site and, while voicing                                                            
"general  support"  for  the TRA  committee  substitute,  urged  the                                                            
Committee to revoke the  non-mechanically propelled vessel exemption                                                            
afforded  in  the  Version  "U"  committee  substitute  in  Sec.  2,                                                            
subsection  (i)(4) on  page two,  lines  12 -15.  She declared  that                                                            
allowing  this  exemption  would, in  effect,  place the  burden  of                                                            
funding the  program on  the shoulders of  motorized vessel  owners,                                                            
when in fact, all users benefit from it.                                                                                        
                                                                                                                                
Co-Chair  Green  asked  for  confirmation   that  AOC  is  concerned                                                            
specifically about language  on lines 12-15 of Section 2, subsection                                                            
(i)(4)  rather  than  the entirety  of  the  exemption  language  as                                                            
identified  on  lines 12  through  19 of  that  section  in the  TRA                                                            
committee substitute.                                                                                                           
                                                                                                                                
Ms. Yuhas clarified  that AOC is most  concerned about the  language                                                            
on lines  12 through 15  of that section.  The language in  question                                                            
reads as follows.                                                                                                               
                                                                                                                                
     (4) a boat that is not equipped with mechanical propulsion [,                                                              
     THAT IS EXCLUSIVELY PADDLED, POLED, ROWED, OR POWERED BY WIND,                                                             
     AND THAT IS                                                                                                                
          (A) UNDER 10 FEET IN LENGTH; OR                                                                                       
                                                                                                                                
     New Text Underlined [DELETED TEXT BRACKETED]                                                                             
                                                                                                                                
Senator Bunde questioned  the consequences that would occur were the                                                            
entirety  of Section 2,  subsection (i)(4)(B)  revised, as  it would                                                            
appear  that it would  allow a person  who might,  for example,  not                                                            
operate a motorized  speed boat for more than 30 days  a year, to be                                                            
exempt from registering.                                                                                                        
                                                                                                                                
          (B) OPERATED IN THIS STATE FOR A PERIOD NOT EXCEEDING 30                                                              
     DAYS IN A CALENDAR YEAR BY A PERSON WHO HAS NOT ESTABLISHED                                                                
     RSIDENCY AS DESCRIBED UNDER AS 01.10.055];                                                                                 
                                                                                                                                
REPRESENTATIVE  BRUCE WEYHRAUCH, the  bill's sponsor, affirmed  that                                                            
would be the affect.                                                                                                            
                                                                                                                                
Senator  Bunde  surmised therefore  that  the  entirety  of Sec.  2,                                                            
subsection (i)(4) should be eliminated.                                                                                         
                                                                                                                                
Co-Chair Green  clarified that AOC's  position is that the  language                                                            
in Section  2, subsections  (i)(4) and (4)(A)  that were deleted  in                                                            
the TRA committee substitute be re-inserted.                                                                                    
                                                                                                                                
Senator  Bunde  understood  AOC's  concern  to  be  that  mechanized                                                            
vessels would be subsidizing  the program. Therefore to address that                                                            
concern,  he suggested that  the entirety  of Section 2,  subsection                                                            
(i),subsection (4), lines 12 through 19, be eliminated.                                                                         
                                                                                                                                
Ms. Yuhas clarified  that AOC desires  to have the language  on page                                                            
two, lines 12 through 15, reinstated into bill.                                                                                 
                                                                                                                                
Co-Chair Wilken  clarified that AOC is concerned about  the language                                                            
that reads as follows.                                                                                                          
                                                                                                                                
     (4) a boat that is not equipped with mechanical propulsion [,                                                              
     THAT IS EXCLUSIVELY PADDLED, POLED, ROWED, OR POWERED BY WIND,                                                             
     AND THAT IS                                                                                                                
          (A) UNDER 10 FEET IN LENGTH; OR                                                                                       
                                                                                                                                
     New Text Underlined [DELETED TEXT BRACKETED]                                                                             
                                                                                                                                
Co-Chair  Green recalled  that in  order to pass  the original  bill                                                            
through the Legislative  process, the language in question was added                                                            
as  a compromise  measure  because,  she noted  that,  at the  time,                                                            
people who owned such things  as canoes and kayaks under ten feet in                                                            
length did  not wish to support the  program. The supporters  of the                                                            
original  bill, she  noted,  assumed  that everyone,  regardless  of                                                            
whether  their  vessel   was  motorized  or  not,  participated   in                                                            
recreation  and would require assistance  in times of need  or would                                                            
benefit from one  of the educational programs. Therefore,  she urged                                                            
that this language be reinserted.                                                                                               
                                                                                                                                
Amendment #1:  This language would reinstate the following  language                                                            
into Sec. 2, subsection  (i)(4) on page two, beginning on page 12 as                                                            
follows.                                                                                                                        
                                                                                                                                
     (4) a boat that is not equipped with mechanical propulsion,                                                                
     that is exclusively paddled, poled, rowed, or powered by wind,                                                             
     and that is                                                                                                                
          (A) under 10 feet in length                                                                                           
                                                                                                                                
Co-Chair Green moved to adopt Amendment #1.                                                                                     
                                                                                                                                
Co-Chair Wilken objected for discussion.                                                                                        
                                                                                                                                
Senator Dyson asked the affect of this amendment.                                                                               
                                                                                                                                
Co-Chair Green stated that  were this language reinstated, all boats                                                            
exceeding ten feet in length would require registration.                                                                        
                                                                                                                                
Representative  Bruce  Weyhrauch  explained  that  the  bill,  after                                                            
progressing  through  four  different   committee  hearings,  "is  a                                                            
compromised  package." He noted that  during the bill's progression                                                             
through committees,  AOC had spoken  in support of establishing  the                                                            
2010  termination  date  in  order to  more  adequately  assess  the                                                            
language being discussed  in Amendment #1. He informed the Committee                                                            
that were the language  in Amendment #1 reinstated, then language in                                                            
Section 1,  subsection (2) on page  one, beginning on line  11, must                                                            
additionally be discussed as it addresses the same issue.                                                                       
                                                                                                                                
Senator  Bunde  understood  that adoption  of  the  amendment  would                                                            
specify that non-powered  boats under ten feet would  be exempt, and                                                            
that longer  boats such as  canoes, kayaks  and other similar  boats                                                            
would be required to register.                                                                                                  
                                                                                                                                
Ms. Hargis  affirmed  that Senator  Bunde  is correct  in that  were                                                            
Amendment #1 adopted, non-motorized  small boats such as paddleboats                                                            
would  require  registration.  She  stressed  that adoption  of  the                                                            
amendment   would    not   jeopardize   compliance    with   federal                                                            
requirements.  She clarified  that  "the occasional  users" of  such                                                            
things as  kayaks and canoes,  rather than  avid boaters,  requested                                                            
the exemption implemented in the TRA committee substitute.                                                                      
                                                                                                                                
Co-Chair  Wilken understood  therefore  that were  the Committee  to                                                            
adopt the TRA  committee substitute  as is, his 18-foot canoe  would                                                            
not require numbering and  registration; however, he continued, were                                                            
Amendment #1 adopted, that  18-foot boat would require numbering and                                                            
registration as it exceeds ten feet in length.                                                                                  
                                                                                                                                
Senator   Dyson   recalled   that   during   previous   committees'                                                             
discussions, small boat  owners objected to registering them because                                                            
they argued that many small  boats are seldom utilized and therefore                                                            
would not require  the same measure of USCG assistance  that larger,                                                            
more frequently used power  boats would. He voiced opposition to the                                                            
amendment.                                                                                                                      
                                                                                                                                
Ms. Sylvester  stated that the original  purpose of the bill  was to                                                            
either repeal  or extend  the termination date  of the Safe  Boating                                                            
Program.  However,  she  pointed   out that   during  the  committee                                                            
processes,  the issue  of whether  or not to  license non-motorized                                                             
vessels  such  as  rafts,  rowboats,  and  kayaks,  particularly  in                                                            
Interior Alaska,  which were used  on an infrequent basis,  surfaced                                                            
and became  a pivotal point of discussion.  She disclosed  that "the                                                            
bottom line"  regarding this  bill is the  fact that the money  that                                                            
funds  this program  is  derived from  the  federal  motor fuel  tax                                                            
rather  than  from  such things  as  registration  fees.  Thus,  she                                                            
concluded, "the  logical link" in this legislation  is the fact that                                                            
federal  regulations   specifically   require  boats  propelled   by                                                            
motorized mechanisms  to be registered.  While voicing appreciation                                                             
for  AOC's  position,  she  observed  that  there   are impassioned                                                             
positions  on  both  sides of  the  argument.  To  put the  cost  of                                                            
registering  "in perspective,"  she  pointed  out that  the cost  of                                                            
registering a vessel is  $3.33 per year. In summary, she stated that                                                            
removing the language  in question was a policy call  on the part of                                                            
the TRA  committee,  and she  stressed  that, "for  the price,"  the                                                            
Boating Safety Program "is a great program."                                                                                    
                                                                                                                                
Co-Chair  Wilken reviewed  the amendment and  concluded that  a vote                                                            
for the  amendment would  reinstate language  on page two,  lines 12                                                            
through 15 that  was omitted by the TRA committee.  Thus, he stated,                                                            
adoption  of the  amendment  would serve  to continue  the  original                                                            
bill's language  in that any non-motorized boat, ten  feet in length                                                            
or longer, would be required to register.                                                                                       
                                                                                                                                
Senator  Dyson  asked how  many  non-mechanized  vessels  have  been                                                            
registered since this program's implementation.                                                                                 
                                                                                                                                
Ms.  Hargus  stated  that, "there  has  been  compliance"  with  the                                                            
program and that  approximately 25,000 vessels have  registered. She                                                            
noted that  prior to the program's  transferal from federal  control                                                            
to the State,  approximately 33,000  boats were registered  and that                                                            
after the transfer,  the numbers increased  to approximately  85,000                                                            
overall. She disclosed  that upon a USCG review of Search and Rescue                                                            
(S&R)  responses  that  were  conducted,   it  was  determined  that                                                            
approximately  ten percent of the total S&R responses  involved non-                                                            
motorized boats.                                                                                                                
                                                                                                                                
Senator  Dyson  calculated  that  approximately  25-percent  of  the                                                            
entire number  of non-motorized vessels in the State  that should be                                                            
registered,  are.  Continuing,  he  stated  that  adoption  of  this                                                            
amendment  would make the  owners of the  remaining 75-percent  non-                                                            
compliant,  and therefore subject  to sanction. Therefore,  he asked                                                            
the penalty for non-compliance.                                                                                                 
                                                                                                                                
Representative  Weyhrauch  stated that,  the previous  year, he  had                                                            
been cited  for non-registration of  a 16-foot Boston Whaler  skiff.                                                            
He disclosed  that he had  received a citation  and was required  to                                                            
comply with USCG licensing regulations.                                                                                         
                                                                                                                                
Senator Dyson asked whether  his picture was published in the paper.                                                            
                                                                                                                                
Representative Weyhrauch  responded in the negative, and stated that                                                            
once he had complied with  the requirements, the case was dismissed.                                                            
                                                                                                                                
Senator Dyson understood therefore that no fine was levied.                                                                     
                                                                                                                                
Representative Weyhrauch  stated that he was required to comply with                                                            
the requirements and did not have to pay a fine.                                                                                
                                                                                                                                
Senator Olson spoke against the amendment.                                                                                      
                                                                                                                                
Ms. Hargus  stated that  were the  State, rather  than the USCG,  to                                                            
have cited  Representative  Weyhrauch,  a $50 fine  would have  been                                                            
levied for the offense.                                                                                                         
                                                                                                                                
Co-Chair Wilken, noting  that the end of this Legislative Session is                                                            
nearing,  asked how  the adoption  of  this amendment  would  affect                                                            
further action on this bill.                                                                                                    
                                                                                                                                
Representative  Weyhrauch opined that  this action would  negatively                                                            
affect the bill's passage.                                                                                                      
                                                                                                                                
Senator  B. Stevens understood  that the  amendment would  reinstate                                                            
the registration  for  non-motorized  vessels that  are ten feet  in                                                            
length  or  longer  and would  not  require  registration  for  non-                                                            
motorized vessels less  than ten feet. He declared a conflict, as he                                                            
owned boats in each category.                                                                                                   
                                                                                                                                
Senator  B.  Stevens asked  the  reason  that  the adoption  of  the                                                            
amendment "would dislodge the bill from concurrence."                                                                           
                                                                                                                                
Representative Weyhrauch  responded that getting agreement, in light                                                            
of the  controversy  regarding  the termination  date  and the  non-                                                            
motorized vessel registration issues, might be difficult.                                                                       
                                                                                                                                
In  response to  a question  from  Senator  B. Stevens,  Ms.  Hargus                                                            
clarified  that the  registration  issue pertains  to non-motorized                                                             
boats, as  all motorized  vessels would continue  to be required  to                                                            
register.                                                                                                                       
                                                                                                                                
Representative   Weyhrauch  reiterated   that  the  motorized   boat                                                            
registration requirement  is because of the federal  motor fuel tax.                                                            
                                                                                                                                
Ms. Sylvester  pointed  out that the  bill would  not have  reported                                                            
from the TRA committee  were the exemption for non-motorized vessels                                                            
not incorporated.  She stated that  the individuals who opposed  the                                                            
requirement  that  non-powered  vessels  be registered  would  again                                                            
voice their objection to the bill were this language reinstated.                                                                
                                                                                                                                
Co-Chair Wilken voiced  that delaying the bill would be problematic.                                                            
                                                                                                                                
Senator B. Stevens asked regarding the registration fee.                                                                        
                                                                                                                                
Representative Weyhrauch  responded that the three-year registration                                                            
fee is ten-dollars.                                                                                                             
                                                                                                                                
Ms. Sylvester stated therefore, that the cost is $3.33 a year.                                                                  
                                                                                                                                
Senator  Olson  spoke against  the  amendment  due to  its  negative                                                            
affect on the  use of small non-motorized boats in  Rural Alaska. He                                                            
stated  that this is  another example  of an  un-necessary layer  of                                                            
government.                                                                                                                     
                                                                                                                                
Senator Bunde  stated that "for the  greater good," he would  oppose                                                            
the amendment.  However, he suggested  that those who disagree  with                                                            
paying $3.33 a year should not receive S&R support.                                                                             
                                                                                                                                
Co-Chair  Green reminded  the Committee  that  the original  Boating                                                            
Safety  Program legislation  would not  have been  enacted were  the                                                            
exemption  awarded  to  non-motorized  vessels  under  ten-feet  not                                                            
incorporated.  She  opined  that  all  boaters  should  support  the                                                            
program as all benefit from it.                                                                                                 
                                                                                                                                
Representative Weyhrauch acknowledged Co-Chair Green' comment.                                                                  
                                                                                                                                
A roll call was taken on the motion.                                                                                            
                                                                                                                                
IN FAVOR: Co-Chair Green                                                                                                        
                                                                                                                                
OPPOSED:  Senator  Hoffman,  Senator   Olson,  Senator  B.  Stevens,                                                            
Senator Dyson, Senator Bunde, and Co-Chair Wilken                                                                               
                                                                                                                                
The motion FAILED (1-6)                                                                                                         
                                                                                                                                
The motion to adopt Amendment #1 FAILED.                                                                                        
                                                                                                                                
CLIFF  JUDKINS, Chair,  Alaska  Boating Association,  testified  via                                                            
teleconference  from Mat-Su, to share  that the Association's  1,200                                                            
membership  consists of both power  and non-power boaters.  He noted                                                            
that his testimony  is "moot" as it  pertained to Amendment  #1 that                                                            
the Committee failed to adopt.                                                                                                  
                                                                                                                                
Senator  Bunde  moved  to  report  the  bill   from  Committee  with                                                            
individual recommendations and accompanying fiscal notes.                                                                       
                                                                                                                                
There  being no  objections,  SCS CS HB  93(TRA)  was REPORTED  from                                                            
Committee with zero fiscal  note #3, dated January 13, 2004 from the                                                            
Department  of Natural Resources  and negative  $24,800 fiscal  note                                                            
#4, dated January  16, 2004 from the  Department of Administration.                                                             
                                                                                                                                
                                                                                                                                
     CS FOR HOUSE BILL NO. 227(JUD)                                                                                             
     "An Act  increasing the jurisdictional  limit for small  claims                                                            
     and  for magistrates  from $7,500  to $10,000;  increasing  the                                                            
     jurisdictional limit  of district courts in certain civil cases                                                            
     from  $50,000  to  $100,000;  expanding   the  jurisdiction  of                                                            
     district  courts;  limiting magistrates  from  hearing  certain                                                            
     small  claims   cases;  and  amending  Rule  11(a)(4),   Alaska                                                            
     District  Court Rules of Civil  Procedure, relating  to service                                                            
     of process for small claims."                                                                                              
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair  Wilken stated  that this  legislation  would increase  the                                                            
jurisdictional  limit of District  Courts from $50,000 to  $100,000.                                                            
He noted that  the Senate Judiciary Committee committee  substitute,                                                            
Version 23-LS0896\U,  and an accompanying indeterminate  fiscal note                                                            
is before the Committee.                                                                                                        
                                                                                                                                
VANESSA TONDINI,  Staff to Representative  Lesil McGuire,  the Chair                                                            
of the Senate  Judiciary Committee, read the sponsor  statement into                                                            
the record as follows.                                                                                                          
                                                                                                                                
     The jurisdictional  limit for  district courts was last  raised                                                            
     in 1990 when  the legislature raised the limit  from $35,000 to                                                            
     $50,000.  By raising the jurisdictional  limit from  $50,000 to                                                            
     $100,000,  this bill  will allow  for increases  inflation  and                                                            
     provide increased  flexibility for litigants  regarding whether                                                            
     to file in district court or superior court.                                                                               
                                                                                                                                
     The jurisdictional  limit on small claims court  and magistrate                                                            
     court was  last raised in 1997 when the legislature  raised the                                                            
     limit  from $5000  to  $7500. Small  claims  court offers  many                                                            
     advantages over district  court to private litigants, including                                                            
     less formal  discovery requirements,  reduced filing  fees, and                                                            
     relaxed  evidentiary rules. This  bill will increase  the limit                                                            
     to $10,000.                                                                                                                
                                                                                                                                
     The bill  also removes prohibitions against the  district court                                                            
     hearing  claims  for false  imprisonment,  libel, slander,  and                                                            
     malicious prosecution.  These restrictions were adopted shortly                                                            
     after statehood.  District court judges are well  qualified and                                                            
     there  is no reason to prohibit  them from hearing these  types                                                            
     of cases.                                                                                                                  
                                                                                                                                
     Finally,  the bill will expand  small claims jurisdiction  over                                                            
     out-of-state   defendants.  Under  current  law,  small  claims                                                            
     actions  against out-of-state  defendants  may only be  brought                                                            
     under  the landlord-tenant  act  or under  AS 09.05.020,  which                                                            
     authorizes  services of process against owners  or operators of                                                            
     motor vehicles  involved in an accident in the  State. The bill                                                            
     would  authorize small  claims jurisdiction  over out-of-state                                                             
     defendants   under   traditional  long-arm   principles.   This                                                            
     expanded  long-arm jurisdiction  is limited  to district  court                                                            
     judges. Magistrates  will continue to limited  by the standards                                                            
     set forth in current law.                                                                                                  
                                                                                                                                
Ms.  Tondini  summarized  that  the  bill  would  implement  several                                                            
"upgrades"  to  jurisdictions"  of the  Court  system  and would  be                                                            
consistent   with  the   Court's  "general   philosophy"   regarding                                                            
encouraging citizen  to "access lower courts in a  friendly manner."                                                            
She noted that the business community supports this bill.                                                                       
                                                                                                                                
DOUG   WOOLIVER,    Administrative    Attorney,   Office    of   the                                                            
Administrative  Director, Alaska Court System, noted  that while the                                                            
Court  System did  not initiate  this legislation,  several  changes                                                            
incorporated into this  bill are consistent with the Court's general                                                            
philosophy   regarding  making   the  Courts   more  accessible   to                                                            
litigants.  However, he noted  that the downside  to increasing  the                                                            
small claims  jurisdictional  limit and making  the process  easier,                                                            
cheaper,  and more  relaxed  for litigants  to  sue  people, is  the                                                            
concern that  judges might  hear a large case  that might not  "have                                                            
been  adequately argued,"  has  had no  briefing,  and would  simply                                                            
involve two  people appearing  before a judge.  He noted that  while                                                            
judges are comfortable  with this process when small  dollar amounts                                                            
are involved, the higher  the limit is would increase the likelihood                                                            
that the resulting  ruling might not  be "particularly well  thought                                                            
out."                                                                                                                           
                                                                                                                                
Mr. Wooliver  stated that  the Court System's  indeterminate  fiscal                                                            
note takes  into consideration  that more  out-of-state court  cases                                                            
are likely  and that,  due to the  higher limit  allowed, some  non-                                                            
economical  cases might be heard in  a small claims court.  He noted                                                            
however,  that when  the jurisdictional  level was  last raised,  no                                                            
significant court expense resulted.                                                                                             
                                                                                                                                
Senator  Olson asked  whether, in  addition to  the District  Court,                                                            
this legislation  might affect  other segments  of the Court  System                                                            
that operate under "the rules of civil procedure."                                                                              
                                                                                                                                
Mr.  Wooliver  responded  "not  directly,  no."  He  continued  that                                                            
currently,  cases involving  claims  in excess  of  $50,000 must  be                                                            
heard by the Superior  Court, and were this bill adopted,  claims up                                                            
to $100,000 could  now be heard by the District Court.  He clarified                                                            
that no jurisdictional  issues involving the Superior Court would be                                                            
affected.                                                                                                                       
                                                                                                                                
Co-Chair  Green  moved  to  report  the  bill  from  Committee  with                                                            
individual recommendations and accompanying fiscal note.                                                                        
                                                                                                                                
There  being  no  objection,  CS HB  227  (JUD)  was  REPORTED  from                                                            
Committee  with indeterminate  fiscal note  #2, dated April  7, 2004                                                            
from the Alaska Court System.                                                                                                   
                                                                                                                                
                                                                                                                                
     SENATE CS FOR CS FOR HOUSE BILL NO. 336(JUD)                                                                               
     "An Act relating to motor vehicle insurance; limiting recovery                                                             
     of civil damages by an uninsured driver; and providing for an                                                              
     effective date."                                                                                                           
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair  Wilken commented  that this legislation  would prohibit  a                                                            
person operating  an uninsured  motor vehicle  from recovering  non-                                                            
economic losses in situations  in which injury or death might occur.                                                            
He noted  that  SCS CS  HB 336(JUD),  Version 23-LS1254\I,  and  two                                                            
accompanying fiscal notes are before the Committee.                                                                             
                                                                                                                                
REPRESENTATIVE  KEVIN MEYER,  the bill's sponsor,  pointed  out that                                                            
the two accompanying  fiscal notes  indicate that no expenses  would                                                            
be incurred were this bill  implemented. He explained that this bill                                                            
would decree  that, "if  you are  knowingly going  to operate  a car                                                            
without State  required car  insurance, then  you simply cannot  sue                                                            
for non-economic  damages such as  pain and suffering;" however,  he                                                            
clarified that a person  could sue for punitive and economic damages                                                            
such as wages,  medical expenses, and car repair expenses.  He noted                                                            
that the  word "knowingly"  was incorporated  into  the bill  by the                                                            
Senate Judiciary  (JUD) Committee.  Other language added  by the JUD                                                            
Committee  he explained, stated  that a person  who knowingly  drove                                                            
without the  required vehicle insurance  could sue for non-economic                                                             
damages in situations  in which the other driver:  was driving while                                                            
intoxicated or was on drugs;  intentionally caused the accident; was                                                            
fleeing  from the  scene of the  crime; or  was at  the time of  the                                                            
accident  committing "a felony,  or was driving  recklessly  or with                                                            
gross  negligence."  He  voiced  his  support   for  the  amendments                                                            
incorporated into the JUD committee substitute.                                                                                 
                                                                                                                                
                                                                                                                                
SFC 04 # 106, Side B 4:11 PM                                                                                                    
                                                                                                                                
                                                                                                                                
Representative  Meyer stated that this legislation  was developed as                                                            
a result of a  constituent who is a single woman with  "a low-paying                                                            
job" and who struggled  to pay $1,500 a year for her  car insurance,                                                            
contacted him after discovering  that her neighbor, admittingly, did                                                            
not have  vehicle insurance.  This woman,  he shared, thinking  this                                                            
was  unfair,  began  to  research  the  situation,  and  found  that                                                            
numerous  states,  such  as  California,  have  adopted legislation                                                             
prohibiting uninsured motorist  from collecting non-economic awards,                                                            
and  that other  states also  prohibit  the furthering  of  economic                                                            
awards.  He shared  that the  JUD  committee substitute  before  the                                                            
Committee  resembles  law  currently  in  effect  in  Louisiana.  In                                                            
addition,  he disclosed  that insurance  agencies pass non-economic                                                             
lawsuits award  expenses on to the 82-percent of vehicle  owners who                                                            
pay insurance  premiums. Therefore,  he stressed  that those  who do                                                            
pay  are essentially  subsidizing  the  costs  incurred  by the  18-                                                            
percent that do not.                                                                                                            
                                                                                                                                
Representative  Meyers disclosed that a member of  his family, while                                                            
driving, has  experienced two instances  in which she was  hit by an                                                            
uninsured motorist,  and at the time, he thought,  "no problem, this                                                            
is why I have  insurance coverage."  However, he has since  realized                                                            
that as a result  of these types of  accidents, his insurance  rates                                                            
rise. Therefore,  he stated that as a matter of fairness,  "a person                                                            
who is not paying  into the system should not be able  to collect as                                                            
much out  of the system."  He also proclaimed  that individuals  who                                                            
comply  with  the   law  and  pay  liability  insurance   should  be                                                            
classified   as  "victims"  of  an   uninsured  motorist.   He  also                                                            
acknowledged  that an uninsured  person might  be unable to  acquire                                                            
insurance due to having  had multiple accidents or speeding tickets.                                                            
He stressed that  these people should not be on the  road. He stated                                                            
that the goal of this legislation  would be to encourage everyone to                                                            
comply with the law as  greater protection and fairness for everyone                                                            
would result.  He reminded  that driving  is a  privilege and  not a                                                            
right.                                                                                                                          
                                                                                                                                
Representative  Meyers  noted  that the  committee  substitute  also                                                            
contains  "minor  technical  changes"   that  pertain  to  insurance                                                            
statutes.                                                                                                                       
                                                                                                                                
MICHAEL  LESSMIER,  Attorney,  State Farm  Insurance,  informed  the                                                            
Committee that  State Farm has 26-percent of the State's  automobile                                                            
insurance  market "with  approximately 123,000  policies in  force."                                                            
Continuing,  he stated  that  every  State Farm  policyholder  would                                                            
"positively benefit" were this legislation adopted.                                                                             
                                                                                                                                
Mr. Lessmier addressed  the two technical changes  incorporated into                                                            
the JUD committee substitute  in Sections 2 through 5: one being the                                                            
"mirror rule"  which resulted from a federal Supreme  Court decision                                                            
that mandated  the each "uninsured/underinsured  motorists  coverage                                                            
must  mirror  the  coverage  in your  liability  policy."  This,  he                                                            
explained,  means that were  one's liability  policy to provide  for                                                            
punitive  damages, one's  "uninsured/underinsured  motorists  policy                                                            
must also provide  for punitive damages.  He stated that,  "there is                                                            
no good reason  to require a victim of an uninsured  motorist to pay                                                            
for that kind of coverage"  in that, he expressed, "punitive damages                                                            
don't  punish the  uninsured  driver at  all, they  just punish  the                                                            
victim."  Therefore,  he stated  that  the bill  addresses  punitive                                                            
damage coverage  by specifying that it would "not  be required to be                                                            
part of the uninsured/underinsured motorist coverage."                                                                          
                                                                                                                                
Mr. Lessmier  stated  that the other  technical  change in the  bill                                                            
addresses the system that  has been established in the State through                                                            
which insurance companies  provide policyholders the option to elect                                                            
one  of  a  variety  of  monetary  levels  of  the  mandated  offers                                                            
uninsured/underinsured  coverage. He noted that while a person could                                                            
decline to purchase uninsured/underinsured  motorist coverage at the                                                            
onset of purchasing  a new policy, insurance companies  are required                                                            
to provide these  options to each policyholder every  six months. He                                                            
continued  that, in  addition, State  Courts have  ruled that  these                                                            
coverage offers  must be provided for "umbrella policies  as well as                                                            
on  the  underlying   primary  policy   covering  the  automobile."                                                             
Therefore,  he stated,  the multitude  of different  offerings  on a                                                            
multitude  of  different policies  is  difficult  to manage  and  to                                                            
understand, and  furthermore, he disclosed that one  major insurance                                                            
carrier in the State has  halted its issuance of umbrella and access                                                            
policies as a  result of this requirement. In summary,  he explained                                                            
that the  technical change  in this regard  is that the requirement                                                             
for the mandatory  uninsured/underinsured  offers be limited  to the                                                            
primary policy covering the automobile.                                                                                         
                                                                                                                                
Mr. Lessmier  stated  that neither  of these  technical changes  are                                                            
controversial,   both  would  be  beneficial,  and   that  both  are                                                            
supported by the Division of Insurance.                                                                                         
                                                                                                                                
Mr. Lessmier commented  that the language in Section 1 would benefit                                                            
policyholders  and  every  single   person  who  complies  with  the                                                            
insurance requirements.  He stated that the New Jersey Supreme Court                                                            
recently  ruled that this  type of  law "advances  a policy  of cost                                                            
containment  by insuring that an injured  uninsured driver  does not                                                            
draw from the  pool of accident victim  insurance funds to  which he                                                            
did not contribute. The  legislation thus gives the uninsured driver                                                            
a very powerful  incentive to comply  with the compulsory  insurance                                                            
laws,  obtain automobile  insurance  coverage or  lose the right  to                                                            
maintain  a suit for  both economic  or non-economic  injuries."  He                                                            
noted  that while  this proposed  law is  not as strict  as the  New                                                            
Jersey law,  it makes  good sense for  Alaska and  is a step  in the                                                            
right direction.                                                                                                                
                                                                                                                                
LINDA  HALL,   Director,  Division   of  Insurance,  Department   of                                                            
Community and Economic  Development, informed the Committee that the                                                            
Department supports the technical language changes.                                                                             
                                                                                                                                
Co-Chair  Green announced a  conflict of interest  as her family  is                                                            
involved in the insurance industry.                                                                                             
                                                                                                                                
Senator  Bunde  moved  to  report  the  bill   from  Committee  with                                                            
individual recommendations and accompanying fiscal notes.                                                                       
                                                                                                                                
There  being no  objection SCS  CS HB  336 (JUD)  was REPORTED  from                                                            
Committee with  zero fiscal note #1,  dated March 29, 2004  from the                                                            
Alaska Court  System and zero fiscal  note #2, dated March  30, 2004                                                            
from the Department of Law.                                                                                                     
                                                                                                                                
                                                                                                                                
     CS FOR HOUSE BILL NO. 419(RES)                                                                                             
     "An Act relating to regional seafood development associations                                                              
     and to regional seafood development taxes."                                                                                
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair  Wilken  commented  that this  bill,  Version 23-LS1418\V,                                                             
would  allow   fishermen  to  form   regional  seafood  development                                                             
associations to tax themselves  and thereby provide a stable funding                                                            
source for marketing efforts.                                                                                                   
                                                                                                                                
REPRESENTATIVE DAN OGG,  the bill's sponsor, stated he is sponsoring                                                            
this bill by request  of the Joint Legislative Salmon  Industry Task                                                            
Force. He explained that  by establishing 12 voluntary regional area                                                            
management associations,  the salmon industry, who  he noted support                                                            
this  legislation,  would be  able  to tax  themselves  in order  to                                                            
assist in the development  and marketing efforts of salmon. He noted                                                            
that the  Copper River  Red Salmon  Association,  which is one  such                                                            
operating association,  has been quite  successful in its  marketing                                                            
endeavors, and  he noted that several other associations  are in the                                                            
developmental  stage. He shared that this legislation  is spurred by                                                            
the fact that  the federal and State  grants that have funded  these                                                            
associations would be terminating  in the near future. Therefore, he                                                            
continued,  the proposed  legislation  would provide  a replacement                                                             
funding mechanism  through which associations could  tax its members                                                            
at rates of either  point-five percent, one percent,  one-point-five                                                            
percent or two-percent  as determined by a vote of permit holders in                                                            
each association. He noted  that once an association is formed in an                                                            
area, other groups  could join it, and he clarified  that non-permit                                                            
holder fisherman  could be non-voting members of an  association. He                                                            
also  noted  that provisions  in  the  bill would  allow  those  not                                                            
interested  in joining an association  to opt out of membership  and                                                            
that were an association to desire to disband, it could do so.                                                                  
                                                                                                                                
Representative  Ogg  stated  that  rather  than  these associations                                                             
competing with  the Alaska Seafood  Marketing Institute (ASMI),  the                                                            
goal would be to enhance  the marketing of salmon in a collaborative                                                            
rather than  adversarial manner. He  urged the Committee  to support                                                            
the bill.                                                                                                                       
                                                                                                                                
Senator Olson asked whether  there is any opposition to the proposal                                                            
as   oftentimes   controversy   accompanies   situations   involving                                                            
taxation.                                                                                                                       
                                                                                                                                
Representative  Ogg responded that  there has been no opposition  to                                                            
the  legislation.  He  recalled  that  some  members  of  the  troll                                                            
industry had some initial  questions which were adequately responded                                                            
to, and that, in general,  there has been positive response from the                                                            
industry as well as from United Fishermen of Alaska (UFA).                                                                      
                                                                                                                                
JERRY MCCUNE,  Representative, United Fishermen of  Alaska (UFA) and                                                            
Cordova  Fishermen  United, testified  in  support of  the bill.  He                                                            
affirmed  that there is  industry concern  regarding how to  replace                                                            
the  current  grant  funding  and  that   the  development  of  area                                                            
associations would benefit the industry.                                                                                        
                                                                                                                                
AT EASE: 4:25 PM/ 4:26 PM                                                                                                       
                                                                                                                                
Amendment #1: This amendment makes the following changes.                                                                       
                                                                                                                                
Following the word "fishery"  in Section 3, subsection 43.76.370 (b)                                                            
on  page  four,   line  three,  the  words  ",  or   is  amended  or                                                            
terminated," are inserted.                                                                                                      
                                                                                                                                
In  addition,  the  amendment  would  insert,   following  the  word                                                            
"section;"  in  Section 3,  subsection  (b)(1)  on page  four,  line                                                            
seven,  the  language "(2)  at  least  30 percent  of  the  eligible                                                            
interim-use  permit and entry permit  holders in the fishery  cast a                                                            
ballot in the election to levy, amend, or terminate the tax;".                                                                  
                                                                                                                                
Other changes  include the replacement of "(a) and  (c)" with "(a) -                                                            
(c)"  in Section  3,  subsection  (d) on  page  five,  line 19;  the                                                            
replacement  of "(a), (c),  and (d)" with  "(a) -(d)" in Section  3,                                                            
subsection (h) on page six, line ten.                                                                                           
                                                                                                                                
In addition,  the  phase "upon  majority  vote at  an election  held                                                            
under  AS 43.76.370"  is deleted  and replaced  with "upon  majority                                                            
vote of eligible  permit holders who vote in an election  held under                                                            
AS 43.76.370  in which at  least 30 percent  of the eligible  permit                                                            
holders cast a  ballot." in Section 3, Section 43.76.375  of Section                                                            
3, subsection (a) on page six, lines 21 and 22.                                                                                 
                                                                                                                                
And finally,  following  the word  "tax;" in  Section 3,  subsection                                                            
(b)(3)  on page seven,  line eight,  the language  "(4) at least  30                                                            
percent  of the  permit  holders who  are eligible  to  vote in  the                                                            
election cast a ballot in the election." is inserted.                                                                           
                                                                                                                                
The   amendment  also   specifies   that  sections   be   renumbered                                                            
accordingly.                                                                                                                    
                                                                                                                                
Co-Chair Wilken  moved to adopt the amendment and  objected in order                                                            
to allow the bill's sponsor to explain the amendment.                                                                           
                                                                                                                                
Representative  Ogg voiced  support for the  amendment, as  it would                                                            
allow a vote conducted  by an association to be validated provided a                                                            
minimum 30-percent  of eligible permit  holders participated  in the                                                            
election.                                                                                                                       
                                                                                                                                
Co-Chair Wilken removed his objection.                                                                                          
                                                                                                                                
There being no further objection, Amendment #1 was ADOPTED.                                                                     
                                                                                                                                
Senator Bunde  moved to report the bill, as amended,  from Committee                                                            
with individual recommendations and accompanying fiscal notes.                                                                  
                                                                                                                                
There  being no  objection, SCS  CS HB  419(FIN)  was REPORTED  from                                                            
Committee  with zero fiscal  note #1, dated  February 19, 2004  from                                                            
the   Department  of   Community   and  Economic   Development   and                                                            
indeterminate  fiscal  note  #2, dated  February  8, 2004  from  the                                                            
Department of Revenue.                                                                                                          
                                                                                                                                
                                                                                                                                
     CS FOR HOUSE JOINT RESOLUTION NO. 44(RES) am                                                                               
     Relating to research into the decline of the Southwest Alaska                                                              
     population of the Northern Sea Otter in the western Gulf of                                                                
     Alaska.                                                                                                                    
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
REPRESENTATIVE  DAN OGG,  the Resolution's  sponsor, explained  that                                                            
this Resolution was developed  in response to a recent United States                                                            
Fish  and Wildlife  Service  proposal  to  list  sea otters  in  the                                                            
Southwest  region of the  State as threatened  under the  Endangered                                                            
Species  Act.  He  stated  that  this  Resolution  suggests,  in  "a                                                            
proactive fashion,"  that a federal research program  be implemented                                                            
for five  years prior to  a decision being  regarding the sea  otter                                                            
endangerment  status,  as  there  is  concern  that  the  commercial                                                            
fisheries operating  in the area might  be negatively affected  were                                                            
their fishery closed or curtailed were that status enacted.                                                                     
                                                                                                                                
AT EASE 4:31 PM / 4:31 PM                                                                                                       
                                                                                                                                
Co-Chair Green  moved to report the  Resolution from Committee  with                                                            
individual recommendations and accompanying fiscal notes.                                                                       
                                                                                                                                
There  being no  objections,  CS  HJR 44(RES)am  was  REPORTED  from                                                            
Committee with  zero fiscal note #1,  dated March 31, 2004  from the                                                            
House Resources Committee.                                                                                                      
                                                                                                                                
                                                                                                                                
     CS FOR HOUSE BILL NO. 424(JUD)                                                                                             
     "An Act  relating to review by  the Legislative Affairs  Agency                                                            
     of  certain state  agency  regulations proposed  for  adoption,                                                            
     amendment,  or repeal under the  Administrative Procedure  Act;                                                            
     repealing provisions  relating to annulment of regulations; and                                                            
     providing for an effective date."                                                                                          
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair Wilken  stated that this bill, Version 23-LS0732\U,  "would                                                            
establish a  formal process in which  a Legislative review  would be                                                            
included  when  specified  State  agencies'  regulations  are  being                                                            
developed  after  legislation  is  adopted. He  noted  that  several                                                            
fiscal notes accompany the legislation.                                                                                         
                                                                                                                                
BARBARA  COTTING,  Staff  to Representative   Jim Holm,  the  bill's                                                            
sponsor,  affirmed Co-Chair  Wilken's  remarks.  She commented  that                                                            
"Legislators are often  surprised" by how laws they have enacted are                                                            
enforced by  regulation. She reviewed  that, under current  law, the                                                            
lone individual  specified  to review  regulations  is the  Attorney                                                            
General. This  legislation, she continued, would implement  a formal                                                            
process that  would require  the Legislative  Legal Division  of the                                                            
Legislative  Affairs Agency  to review regulations,  written  by the                                                            
various  agencies, in  order to  determine whether  the regulations                                                             
comply with statutory  authority and Legislative intent.  She stated                                                            
that were non-compliance  determined,  the appropriate people  would                                                            
be notified  "and the Legislature  can act." She stressed  that this                                                            
process would have a positive  impact on the State's economy because                                                            
the  Legislative   intent  would   be  upheld  and  a  more   stable                                                            
environment would be created.                                                                                                   
                                                                                                                                
Senator Dyson  asked whether the sponsor's handout  titled "Steps in                                                            
the  Regulation  Adoption  Process"  [copy  on  file]  outlines  the                                                            
current process.                                                                                                                
                                                                                                                                
Ms. Cotting affirmed that it does.                                                                                              
                                                                                                                                
Senator  Dyson asked  where, in  the current  process, the  proposed                                                            
procedure would be implemented.                                                                                                 
                                                                                                                                
Ms. Cotting  responded that  the proposed  Legislative Legal  review                                                            
would occur  between Steps Four "Department  of Law opens  file" and                                                            
Five "Agency publishes  and distributes public notice,  add't notice                                                            
information, and regulations".                                                                                                  
                                                                                                                                
Senator Dyson  asked for further information  regarding the  process                                                            
that would be  implemented were Legislative Legal  to determine that                                                            
the regulations were non-compliant.                                                                                             
                                                                                                                                
Ms. Cotting  responded that, "at that  point, written notice"  would                                                            
be provided to the Department  of Law, the agency that developed the                                                            
regulations, the  Regulation Review Committee, the  President of the                                                            
Senate, and the Speaker of the House.                                                                                           
                                                                                                                                
Senator  Dyson asked  what  action might  occur  upon notification;                                                             
specifically  in  a  situation  where  the  agency  disregarded  the                                                            
notice.                                                                                                                         
                                                                                                                                
Ms.  Cotting  responded   that  other  than  notification   of  non-                                                            
concurrence,  the  State's  Constitution   regarding  separation  of                                                            
powers would not allow the process to be halted.                                                                                
                                                                                                                                
Senator  Dyson surmised  therefore,  that  the option  in that  case                                                            
would  be to  adopt  more State  statutes  in  order to  allow  more                                                            
conformity to occur.                                                                                                            
                                                                                                                                
Ms. Cotting agreed.                                                                                                             
                                                                                                                                
Senator   Dyson  noted  that   other  states   have  allowed   their                                                            
legislature  to change regulation  by resolution.  He asked  whether                                                            
this process would require a Constitutional amendment.                                                                          
                                                                                                                                
Ms Cotting affirmed that  it would. She noted that another component                                                            
of this bill would  remove that provision from State  statute, as it                                                            
was declared unconstitutional.                                                                                                  
                                                                                                                                
Senator Bunde  recalled that a similar  proposal by the Legislature                                                             
had previously been "soundly rejected" in a statewide ballot.                                                                   
                                                                                                                                
DEBRA BEHR,  Assistant Attorney General,  Legislative & Regulations                                                             
Section,  Office  of  the  Attorney  General,   Department  of  Law,                                                            
affirmed that such language  had been on a Statewide election ballot                                                            
in 1980, 1984, and 1986,  and had, she continued, been defeated each                                                            
time by voters.                                                                                                                 
                                                                                                                                
Senator  Bunde  commented  that  were  a  Legislative  Legal  review                                                            
process added  to the current process, modifications  to the process                                                            
might  occur   over  time.   He  opined   that  were  this   process                                                            
implemented, the Legislature  might benefit by being forewarned that                                                            
changes  might  be   required  "sooner  than  later."   However,  he                                                            
cautioned that, without  additional staff, the volume of regulations                                                            
that occur  on an  annual basis  might overwhelm  Legislative  Legal                                                            
personnel.                                                                                                                      
                                                                                                                                
Ms.  Behr stated  that  the  Legislative  Affairs  Agency's  initial                                                            
fiscal  note,  in addition  to  requesting  an  additional  attorney                                                            
position,  reflected  funding  from the  Legislature.  However,  she                                                            
noted  that  that  fiscal  note  was zeroed  out  by  the  House  of                                                            
Representatives   Finance  Committee.  She  pointed   out  that  the                                                            
Department of Law's indeterminate  fiscal note #6, which accompanies                                                            
the  bill, is  the result  of  uncertainty  regarding  the level  of                                                            
resources that  might be provided by the Legislature  as well as the                                                            
effect  on the  level of  support  the Department  of  Law would  be                                                            
required to provide to the process.                                                                                             
                                                                                                                                
Senator Bunde  asked the number of regulations that  would have been                                                            
reviewed the previous year, were this process in effect.                                                                        
                                                                                                                                
Ms. Behr responded that  this legislation would establish a priority                                                            
system in  that reviews  could be limited  to regulations  resulting                                                            
from new legislation  or expanded  to review regulations  pertaining                                                            
to regulations  that the Legislature  might perceive "to  have major                                                            
policy  implications."  She reiterated  that,  in addition  to  this                                                            
unknown element, Legislative  Legal workloads during the Legislative                                                            
Session would require Legislative Council prioritization.                                                                       
                                                                                                                                
Senator   Bunde  asked   for  further  information   regarding   the                                                            
determinations   of  major   policy  implications   by  Legislative                                                             
committees.                                                                                                                     
                                                                                                                                
Ms. Behr  referred  the Committee  to the  prioritization  procedure                                                            
language  located in Section  2, subsection  (b)(1) and (2)  on page                                                            
two, lines 7-13 that reads as follows.                                                                                          
                                                                                                                                
     (b) Reviews shall be conducted under (a) of this section in                                                                
     the following order of priority:                                                                                           
          (1) proposed regulations that would implement newly                                                                   
     enacted legislation;                                                                                                       
          (2) proposed regulations requested in writing to be                                                                   
     reviewed   by   a  standing   committee,   the  Administrative                                                             
     Regulation  Review  Committee, or  the legislative  council  as                                                            
     implicating major policy development.                                                                                      
                                                                                                                                
Ms. Behr stated  that this language would assist in  avoiding review                                                            
of every regulation which  could, she exampled, range from reviewing                                                            
regulations  pertaining  to non-major  priority things  such as  the                                                            
raising  of fees  five dollars  or increasing  continuing  education                                                            
requirements for hairdressers.  Therefore, she stated that the bill,                                                            
as written,  would allow  regulations to be  reviewed as desired  by                                                            
the Legislature.                                                                                                                
                                                                                                                                
DAVE STANCLIFF,  Staff, Administrative Regulatory  Review Committee,                                                            
Office  of  Senate  President  Gene  Therriault,  stated  that  this                                                            
legislation  would develop  a "cooperative  quality review"  process                                                            
that, by  allowing the Legislature  to be  involved in the  process,                                                            
would  serve  to  encourage  that  regulations   are  "written  more                                                            
carefully." He  noted that were a prioritization process  developed,                                                            
Legislative  Legal staff would work  with the Department  of Law and                                                            
the various departments'  regulation writers to enhance the process.                                                            
Furthermore,  he  continued,   that  were  the  system  to  work  as                                                            
intended, the Legislature could increase funding if so desired.                                                                 
                                                                                                                                
Senator Olson  asked how controversial, high visibility  regulations                                                            
such as those pertinent  to the Department of Fish and Game would be                                                            
addressed.                                                                                                                      
                                                                                                                                
Ms. Behr stated that the  Department of Fish and Game is exempt from                                                            
this review proposal as  that Department has its own Board and has a                                                            
different regulation process.                                                                                                   
                                                                                                                                
Co-Chair  Green  moved  to  report  the  bill  from  Committee  with                                                            
individual recommendations and accompanying fiscal notes.                                                                       
                                                                                                                                
There  being  no  objection,  CS  HB  424(JUD)   was  REPORTED  from                                                            
Committee with  zero fiscal note #4,  dated March 24, 2004  from the                                                            
Department  of Health  and  Social Services;  zero  fiscal note  #5,                                                            
dated March 25, 2004 from  the Legislature; and indeterminate fiscal                                                            
note #6, dated March 24, 2004 from the Department of Law.                                                                       
                                                                                                                                
                                                                                                                                
     CS FOR HOUSE BILL NO. 484(JUD) am                                                                                          
     "An Act imposing  a correctional facility surcharge  on persons                                                            
     convicted  of a  crime under  state  law and  on persons  whose                                                            
     probation  is  revoked;  relating  to  fees  and  expenses  for                                                            
     interstate  transfer of probation or parole;  and providing for                                                            
     an effective date."                                                                                                        
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair Wilken stated  that the House Rules Committee by Request of                                                            
the Governor  sponsors this  bill, Version  23-GH2046\D.A.  He noted                                                            
that the bill would implement  correctional fees and surcharges on a                                                            
person arrested  and sentenced to  a term of imprisonment.  He noted                                                            
that  the  level   of  the  surcharge  would  be  dictated   by  the                                                            
seriousness  of  the  crime.  He noted  that  several  fiscal  notes                                                            
accompany the bill.                                                                                                             
                                                                                                                                
PORTIA  PARKER, Deputy  Commissioner,  Office of  the Commissioner,                                                             
Department  of Corrections  informed the Committee  that this  House                                                            
bill  is  the  companion  bill  to  a  Senate  Bill  336  which  was                                                            
previously  reported  from   Committee.  She  noted  that  the  lone                                                            
difference  in the two bills is that  this bill would eliminate  the                                                            
requirement that an inmate  post a bond when being transferred to an                                                            
out-of-State prison facility.  She noted that both the House and the                                                            
Senate raised  concerns in this regard. Furthermore,  she added that                                                            
language  pertaining to the  Interstate Compact  was eliminated,  as                                                            
pertinent federal rules would be changing this year.                                                                            
                                                                                                                                
Co-Chair  Green  moved  to  report  the  bill  from  Committee  with                                                            
individual recommendations and accompanying fiscal notes.                                                                       
                                                                                                                                
There  being no  objections,  CS  HB 484(JUD)am  was  REPORTED  from                                                            
Committee with  $46,500 fiscal note #1, dated February  3, 2004 from                                                            
the Department  of Law; zero  fiscal note  #2, dated April  13, 2004                                                            
from the  Alaska Court System;  and $9,800  fiscal note #3  from the                                                            
Department of Corrections.                                                                                                      
                                                                                                                                
                                                                                                                                
     CS FOR HOUSE BILL NO. 533(JUD)                                                                                             
     "An Act relating to the state's administrative procedures and                                                              
     to judicial oversight of administrative matters."                                                                          
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair  Wilken stated that  this bill, which  is sponsored  by the                                                            
House State  Affairs Committee, would  allow a person who  is unable                                                            
to acquire  a final administrative  decision from a State  agency to                                                            
request  assistance from  the State  Superior Court.  He noted  that                                                            
Version 23-LS1833\I is before the Committee for consideration.                                                                  
                                                                                                                                
REPRESENTATIVE   BRUCE  WEYHRAUCH,   Chair,   House  State   Affairs                                                            
Committee  which sponsors  this bill, explained  that the intent  of                                                            
this bill is  to provide a person  the ability to "dynamite  a case"                                                            
being  reviewed by  an administrative  agency from  that agency  and                                                            
place  it  with the  Superior  Court  in  order  to obtain  "a  more                                                            
expeditious decision."                                                                                                          
                                                                                                                                
Senator Olson asked how frequently these situations occur.                                                                      
                                                                                                                                
Representative   Weyhrauch   clarified  that   the  Superior   Court                                                            
jurisdictional   review  process   is  currently   unavailable.   He                                                            
explained  that, even were  this legislation  adopted, the  proposed                                                            
process would not be implemented  without a "showing of unreasonable                                                            
delay,"  and,  in  addition,  the  administrative  agency  would  be                                                            
provided  an opportunity to  provide a rational  reason as to  why a                                                            
decision  had  not  be  made.  He also  pointed  out  that  in  some                                                            
instances,  a delay in a determination  might benefit an  individual                                                            
as exampled by a situation  in which, during the review process, the                                                            
Department  of Fish and Game might  issue an interim fishing  permit                                                            
to a person who might have  some issues that might negatively affect                                                            
their  application.   On   the  other  hand,   he  stated,   were  a                                                            
determination  regarding an  appeal of a  person's business  license                                                            
delayed,  the  person's   livelihood  could  be  jeopardized.   This                                                            
legislation, he attested,  would enable a person to request that the                                                            
agency "move quickly provide" to expedite the decision.                                                                         
                                                                                                                                
Co-Chair Green  moved to adopt Version "I" as the  working document.                                                            
                                                                                                                                
There being  no objection,  Version "I" was  adopted as the  working                                                            
document.                                                                                                                       
                                                                                                                                
Senator Bunde asked regarding  Fiscal Note #4 from the Department of                                                            
Law.                                                                                                                            
                                                                                                                                
Representative  Weyhrauch  responded  that  this fiscal  note  would                                                            
address  attorney  expenses  incurred  to  the  Department  when  it                                                            
represents  an agency  in litigation  based on  unreasonable  agency                                                            
delay.                                                                                                                          
                                                                                                                                
Senator Bunde  observed that this is "when we sue  ourselves again."                                                            
                                                                                                                                
DAVE STANCLIFF,  Staff, Administrative  Regulatory Review  Committee                                                            
and  Staff  to  Senate  President  Gene  Therriault,   informed  the                                                            
Committee  that,  since  1980, in  excess  of  8,500 administrative                                                             
agency determinations  took  longer than one  year to be  completed.                                                            
Continuing,  he noted  that "what  is not reflected"  in the  fiscal                                                            
notes  are the  savings resulting  from  "less State  time and  less                                                            
State  dollars"   that  would  result   were  decisions   made  more                                                            
expediently.  He  stated  that  quicker  determinations  would  also                                                            
positively impact the private sector.                                                                                           
                                                                                                                                
Senator  Bunde concurred.  However,  he noted that  while this  bill                                                            
would encourage more agency  efficiency, that efficiency requirement                                                            
could provide the opportunity for State agencies to be sued.                                                                    
                                                                                                                                
DOUG   WOOLIVER,    Administrative    Attorney,   Office    of   the                                                            
Administrative  Director,  Alaska  Court  System, noted  that,  even                                                            
though many people  might believe that their delay  is unreasonable,                                                            
the Court System  does not believe it would be "flooded"  with cases                                                            
as, he opined,  the possibility  that a case  might be moved  to the                                                            
Superior Court  would serve to motivate agency determinations  to be                                                            
conducted  within a reasonable  amount of time.  He noted that  this                                                            
process could  also be enhanced as a result of measures  included in                                                            
other legislation that  is being introduced. However, he stated that                                                            
were  thousands  of yearlong  determination   delays to  occur,  the                                                            
Department would require additional funding.                                                                                    
                                                                                                                                
Representative Weyhrauch  informed the Committee that, at one point,                                                            
language  had  been  made entertained   that would  have  served  to                                                            
withhold  payment  to Superior  Court  justices  were  a ruling  not                                                            
forthcoming  within six months  after referral.  He noted that  this                                                            
language,  while not  adopted,  could also  have  applied to  agency                                                            
hearing officers.                                                                                                               
                                                                                                                                
Co-Chair  Green  moved  to  report  the  bill  from  Committee  with                                                            
individual recommendations and accompanying fiscal notes.                                                                       
                                                                                                                                
There  being no  objection, SCS  CS HB  533(FIN)  was REPORTED  from                                                            
Committee with  indeterminate fiscal  note #1, dated March  18, 2004                                                            
from the Alaska  Court System; indeterminate  fiscal note  #2, dated                                                            
March 23,  2004 from the  Department of Fish  and Game; zero  fiscal                                                            
note #3,  dated March  23, 2004  from the Department  of Health  and                                                            
Social Services;  and $84,300 fiscal  note #4, dated March  26, 2004                                                            
from the Department of Law.                                                                                                     
                                                                                                                                
ADJOURNMENT                                                                                                                 
                                                                                                                                
Co-Chair Gary Wilken adjourned the meeting at 04:54 PM                                                                          

Document Name Date/Time Subjects