Legislature(2017 - 2018)SENATE FINANCE 532

04/11/2017 01:30 PM FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ SB 51 EXTEND BOARD OF VETERINARY EXAMINERS TELECONFERENCED
Heard & Held
+ SB 83 PROTECT: VULNERABLE ADULTS/LONG TERM CARE TELECONFERENCED
<Bill Hearing Rescheduled to 1:30 p.m. 04/12/17>
+ Bills Previously Heard/Scheduled: TELECONFERENCED
+= HB 48 ARCHITECTS,ENGINEERS,SURVEYORS: EXTEND BD TELECONFERENCED
Moved HB 48 Out of Committee
+= SB 45 EXEMPTION: LICENSING OF CONTRACTORS TELECONFERENCED
Moved CSSB 45(FIN) Out of Committee
+= SB 78 PERM FUND DIVIDEND CONTRIBUTIONS/LOTTERY TELECONFERENCED
Heard & Held
                 SENATE FINANCE COMMITTEE                                                                                       
                      April 11, 2017                                                                                            
                         1:45 p.m.                                                                                              
                                                                                                                                
1:45:31 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair  MacKinnon  called  the  Senate  Finance  Committee                                                                    
meeting to order at 1:45 p.m.                                                                                                   
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Lyman Hoffman, Co-Chair                                                                                                 
Senator Anna MacKinnon, Co-Chair                                                                                                
Senator Click Bishop, Vice-Chair                                                                                                
Senator Mike Dunleavy                                                                                                           
Senator Peter Micciche                                                                                                          
Senator Donny Olson                                                                                                             
Senator Natasha von Imhof                                                                                                       
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Juli Lucky,  Staff, Senator  Anna MacKinnon;  Juliana Melin,                                                                    
Staff, Senator  Mia Costello;  Pete Fellman,  Staff, Senator                                                                    
Click Bishop;  Sara Race, Director, Permanent  Fund Dividend                                                                    
Division,  Department  of  Revenue; Shareen  Crosby,  Staff,                                                                    
Senator Natasha  von Imhof;  Kris Curtis,  Auditor, Division                                                                    
of Legislative Audit; Janey  Hovenden, Director, Division of                                                                    
Corporations,    Business   and    Professional   Licensing,                                                                    
Department of Commerce,  Community and Economic Development;                                                                    
Dr.  Rachel   Berngartt,  Board  of   Veterinary  Examiners,                                                                    
Juneau.                                                                                                                         
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Brian  Berube,  Alaska   Native  Tribal  Health  Consortium,                                                                    
Anchorage; Pamela Sanash, Self,  Nenana; Lea McKenzie, Self,                                                                    
Sutton; Romaine Kobilsek, Spay Arkansas, Arkansas.                                                                              
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
SB 45     EXEMPTION: LICENSING OF CONTRACTORS                                                                                   
          CSSB 45(FIN) was REPORTED out of committee with a                                                                     
          "do pass" recommendation and with one previously                                                                      
          published zero fiscal note: FN1(CED).                                                                                 
                                                                                                                                
SB 51     EXTEND BOARD OF VETERINARY EXAMINERS                                                                                  
                                                                                                                                
          SB 51 was HEARD and HELD in committee for further                                                                     
          consideration.                                                                                                        
                                                                                                                                
SB 78     PERM FUND DIVIDEND CONTRIBUTIONS/LOTTERY                                                                              
                                                                                                                                
          SB 78 was HEARD and HELD in committee for further                                                                     
          consideration.                                                                                                        
                                                                                                                                
HB 48     ARCHITECTS,ENGINEERS,SURVEYORS: EXTEND Mr. Dale                                                                       
                                                                                                                                
          HB 48 was REPORTED out of committee with a "do                                                                        
          pass" recommendation and with one previously                                                                          
          published fiscal impact note: FN1(CED).                                                                               
                                                                                                                                
Co-Chair MacKinnon discussed  housekeeping. She relayed that                                                                    
SB  51 related  only  to  the board  extension  and did  not                                                                    
include changes to the board.                                                                                                   
                                                                                                                                
HOUSE BILL NO. 48                                                                                                             
                                                                                                                                
     "An Act relating to the  composition of the State Board                                                                    
     of  Registration for  Architects,  Engineers, and  Land                                                                    
     Surveyors; extending the termination  date of the State                                                                    
     Board  of Registration  for Architects,  Engineers, and                                                                    
     Land Surveyors; and providing for an effective date."                                                                      
                                                                                                                                
1:46:34 PM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon  relayed that  the public hearing  for HB                                                                    
48 had  been held  on April  1, 2017.  She related  that her                                                                    
office had received no amendments  to the legislation. Staff                                                                    
to  the  bill sponsor  was  available  in the  audience  for                                                                    
questions.                                                                                                                      
                                                                                                                                
1:47:31 PM                                                                                                                    
                                                                                                                                
Vice-Chair Bishop  MOVED to  report HB  48 out  of Committee                                                                    
with individual recommendations  and the accompanying fiscal                                                                    
note. There being NO OBJECTION, it was so ordered.                                                                              
                                                                                                                                
HB  48  was REPORTED  out  of  committee  with a  "do  pass"                                                                    
recommendation  and  with  one previously  published  fiscal                                                                    
impact note: FN1(CED).                                                                                                          
                                                                                                                                
1:48:29 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:50:05 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
SENATE BILL NO. 45                                                                                                            
                                                                                                                                
     "An Act relating to an exemption from the regulation                                                                       
     of construction contractors."                                                                                              
                                                                                                                                
1:50:10 PM                                                                                                                    
                                                                                                                                
Co-Chair  MacKinnon  informed   the  committee  that  public                                                                    
testimony had been taken on SB 45 on April 7, 2017.                                                                             
                                                                                                                                
Vice-Chair   Bishop  MOVED   to  ADOPT   proposed  committee                                                                    
substitute  for  SB  45,   Work  Draft  30-LS0321\O  (Bruce,                                                                    
4/10/17).                                                                                                                       
                                                                                                                                
Co-Chair MacKinnon OBJECTED for discussion.                                                                                     
                                                                                                                                
JULI   LUCKY,  STAFF,   SENATOR  ANNA   MACKINNON,  directed                                                                    
committee  attention  to Page  3,  lines  8 through  11  and                                                                    
explained changes (copy on file):                                                                                               
                                                                                                                                
     Moved  the language  defining when  construction begins                                                                    
     from section  4 (uncodified  law) to  section 3,  so it                                                                    
     will  appear  in AS  08.18.161  with  the rest  of  the                                                                    
     exemption language.                                                                                                        
                                                                                                                                
Ms. Lucky  explained that  the change  would make  it easier                                                                    
for the public to look up, and obey, the law.                                                                                   
                                                                                                                                
1:51:46 PM                                                                                                                    
                                                                                                                                
JULIANA MELIN,  STAFF, SENATOR  MIA COSTELLO,  expressed the                                                                    
sponsor's support for the change.                                                                                               
                                                                                                                                
Co-Chair MacKinnon  WITHDREW her  OBJECTION. There  being NO                                                                    
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
1:52:45 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Bishop  MOVED  to report  CSSB  45(FIN)  out  of                                                                    
Committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
CSSB 45(FIN) was REPORTED out  of committee with a "do pass"                                                                    
recommendation  and  with   one  previously  published  zero                                                                    
fiscal note: FN1(CED).                                                                                                          
                                                                                                                                
1:53:18 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:55:52 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
SENATE BILL NO. 78                                                                                                            
                                                                                                                                
     "An Act  creating the education endowment  fund and the                                                                    
     dividend lottery  fund; authorizing  contributions from                                                                    
     the  permanent fund  dividend to  the dividend  lottery                                                                    
     fund; relating  to transfers from the  dividend lottery                                                                    
     fund and the education  endowment fund; relating to the                                                                    
     definition   of  'gambling';   and  providing   for  an                                                                    
     effective date."                                                                                                           
                                                                                                                                
1:55:59 PM                                                                                                                    
                                                                                                                                
Vice-Chair   Bishop  MOVED   to  ADOPT   proposed  committee                                                                    
substitute  for  SB  78,  Work  Draft  30-LS0534\M  (Martin,                                                                    
4/5/17).                                                                                                                        
                                                                                                                                
Co-Chair MacKinnon OBJECTED for discussion.                                                                                     
                                                                                                                                
Co-Chair  MacKinnon noted  that  the public  hearing on  the                                                                    
bill had been held on April 7, 2017.                                                                                            
                                                                                                                                
1:56:44 PM                                                                                                                    
                                                                                                                                
PETE  FELLMAN,  STAFF,  SENATOR CLICK  BISHOP,  shared  that                                                                    
people had been uncomfortable  with the word "lottery" being                                                                    
used in the legislation. He  said that the word "raffle" had                                                                    
been chosen as a replacement because  the bill was akin to a                                                                    
bucket  raffle.  He  stated that  throughout  the  bill  the                                                                    
descriptions  for "contributions"  and "donations"  had been                                                                    
clarified to indicate  that the donations would  be used for                                                                    
a specific  purpose. He  added that  some language  had been                                                                    
changed from "may  to "shall" because it  would clarify that                                                                    
the commissioner  would use the  donations for  the programs                                                                    
that  the  bill  created.  He   referred  to  the  document,                                                                    
"Changes  Proposed  by  Finance  CS-Version  30-LS0534\M  to                                                                    
CSSB78(EDC) (copy on file):                                                                                                     
                                                                                                                                
     Proposed Finance  CS would  change all  references from                                                                    
     "lottery"   to  "raffle"   and  it   will  change   all                                                                    
     references from 'contributions"  to "donations" it also                                                                    
     changes the "may" to "shall"                                                                                               
                                                                                                                                
     Bill Title                                                                                                               
                                                                                                                                
     Page 1, line 1: Delete "lottery" Insert "raffle"                                                                           
     Page   1,  line   2:   Delete  "contributions"   Insert                                                                    
     "donations"                                                                                                                
     Page 1, line 2: Insert "for educational"                                                                                   
     Page  1, line  3:  Insert "purposes  and  to enter  the                                                                    
     permanent fund dividend raffle"                                                                                            
     Page 1, line 3: Delete "lottery fund" Insert "raffle"                                                                      
     Page 1 line 4: Delete "lottery" Insert "raffle"                                                                            
                                                                                                                              
     *Section 1. AS 11.66.280(3) is amended to read.                                                                        
     Page 2 line 19: Delete "drawing" Insert "raffle"                                                                           
                                                                                                                              
    *Section 2. AS 43.23.063. Education endowment fund.                                                                     
     Page   2  line   25:   Delete  "contributions"   Insert                                                                    
     "donations"                                                                                                                
     Page 3 line 18: Delete "lottery" Insert "raffle"                                                                           
     Page   3  line   19:   Delete  "contributions"   Insert                                                                    
     "donations" Delete "lottery" Insert "raffle"                                                                               
     Page 3 line 20: Delete "lottery" Insert "raffle"                                                                           
     Page 3 line 22: Delete "may" Insert "shall"                                                                                
     Page   3  line   23:   Delete  "contributions"   Insert                                                                    
     "donations"                                                                                                                
     Page  3 line  24:  Delete "may  "Insert "shall"  Delete                                                                    
     "lottery" insert "raffle"                                                                                                  
     Page 3 line 28: Delete "lottery" Insert "raffle"                                                                           
     Page 3 line 31: Delete "contributed" Insert "donated"                                                                      
     Page 4  line 4/5  Delete "contributed"  Insert "donated                                                                    
     for educational purposes and to enter the                                                                                  
     permanent fund dividend raffle"                                                                                            
     Page   4   line   5:  Delete   "contributions"   Insert                                                                    
     "donations"                                                                                                                
     Page   4   line   8:  Delete   "contributions   "Insert                                                                    
     "donations"                                                                                                                
     Page 4 line 9: Delete "may" Insert "shall"                                                                                 
     Page 4 line 10: Insert "shall appropriate"                                                                                 
     Page  4  line  11:  Delete  "lottery"  Insert  "raffle"                                                                    
     Delete "may" Insert "shall"                                                                                                
     Page   4  line   12:   Delete  "contributions"   Insert                                                                    
     "donations"                                                                                                                
     Page4 line 13: Delete  "Nothing in this section created                                                                    
     a dedicated fund"                                                                                                          
     Page 4 line 15: Delete "lottery" Insert "raffle"                                                                           
     Page 4 line  15, 16: Delete "contribution  to the fund"                                                                    
   Insert "donation as provided in (b) of this section"                                                                         
     Page 4 line 17: Delete "drawing" Insert "raffle"                                                                           
     Page 4  line 19,  21, 23,  25: Delete  "lottery "Insert                                                                    
       affle"                                                                                                                   
     Page  4  line  26:  Insert  "Nothing  in  this  section                                                                    
     creates a dedicated fund.                                                                                                  
                                                                                                                              
     *Section 3. This act takes effect January 1, 2018                                                                        
                                                                                                                                
1:59:02 PM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon asked  about Page 4, line  9; and queried                                                                    
the purpose of changing the word "may" to "shall."                                                                              
                                                                                                                                
Mr. Fellman explained that the  language change was meant to                                                                    
specify  that  the  money  would  be  used  exclusively  for                                                                    
education.                                                                                                                      
                                                                                                                                
1:59:58 PM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon  WITHDREW her  OBJECTION. There  being NO                                                                    
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
Senator  Micciche  wondered   whether  an  individual  could                                                                    
write-off $75 dollars as a  donation to the Public Education                                                                    
Fund  and the  Education  Endowment, while  the  $25 to  the                                                                    
raffle fund would be non-deductible.                                                                                            
                                                                                                                                
Mr. Fellman answered in the affirmative.                                                                                        
                                                                                                                                
2:00:58 PM                                                                                                                    
                                                                                                                                
Co-Chair    MacKinnon    solicited   comments    from    the                                                                    
administration concerning the legislation.                                                                                      
                                                                                                                                
SARA  RACE,  DIRECTOR,  PERMANENT  FUND  DIVIDEND  DIVISION,                                                                    
DEPARTMENT  OF REVENUE,  replied  that the  fund would  work                                                                    
similarly  to  the  University  of  Alaska  College  Savings                                                                    
Program and would be another  available option on the online                                                                    
permanent fund application.                                                                                                     
                                                                                                                                
2:01:29 PM                                                                                                                    
                                                                                                                                
Senator  von  Imhof  considered   the  estimated  2  percent                                                                    
administrative costs  and wondered  whether the  costs could                                                                    
fluctuate as the raffle became more popular.                                                                                    
                                                                                                                                
Ms.  Race  stated  that  the   Treasury  Division  would  be                                                                    
managing  the account,  while  the  Permanent Fund  Division                                                                    
would   be   simply   hosting  the   program   through   the                                                                    
application. She said  that she could refer  the question to                                                                    
the Treasury  Division and have  an answer sent back  to the                                                                    
committee.                                                                                                                      
                                                                                                                                
Senator von Imhof wanted  assurances that the administrative                                                                    
cost would be controlled.                                                                                                       
                                                                                                                                
2:03:00 PM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon  noted that  there was a  one-time, fixed                                                                    
expense of  $8 thousand.  She asked  Ms. Race  whether there                                                                    
was  anything she  would  like to  highlight  in the  fiscal                                                                    
note.                                                                                                                           
                                                                                                                                
Ms. Race  believed that the  department could  implement the                                                                    
proposed program online application.  She said that the one-                                                                    
time  charge was  needed to  make the  changes necessary  to                                                                    
implement the program.                                                                                                          
                                                                                                                                
Co-Chair  MacKinnon  referred  to  the second  page  of  the                                                                    
fiscal analysis (FN 3):                                                                                                         
                                                                                                                                
     This added option will require programming changes to                                                                      
     be made to the division's database and online dividend                                                                     
      application. It will take approximately 50 hours at $                                                                     
     160.00 per hour for a total of $8,000.                                                                                     
                                                                                                                                
Ms. Race answered that the analysis was correct.                                                                                
                                                                                                                                
2:04:09 PM                                                                                                                    
                                                                                                                                
Senator von Imhof queried the mechanics of the drawing.                                                                         
2:04:43 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:05:27 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Mr.  Fellman relayed  that the  department had  communicated                                                                    
that  it  was already  doing  online  advertising for  other                                                                    
programs  such as  college savings  program  and thought  it                                                                    
would  be   very  simple   to  add   the  raffle   to  those                                                                    
advertisements.                                                                                                                 
                                                                                                                                
2:06:12 PM                                                                                                                    
                                                                                                                                
Senator  Micciche understood  that  a person  who turned  18                                                                    
March  31,  the  deadline  for  the  application,  would  be                                                                    
eligible to participate in the raffle.                                                                                          
                                                                                                                                
Ms. Race replied  in the affirmative. She  stressed that the                                                                    
option to  participate would only  be available on  an adult                                                                    
application.                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon  asked what would happen  if an estimated                                                                    
dividend did  not cover  the cost  of the  preordered raffle                                                                    
tickets.                                                                                                                        
                                                                                                                                
Ms. Race  responded that the  division would consider  it in                                                                    
the same way it  currently handled garnishment, contribution                                                                    
or assignment.                                                                                                                  
                                                                                                                                
Co-Chair  MacKinnon understood  that  the  program would  be                                                                    
administered through regulation.                                                                                                
                                                                                                                                
Ms. Race answered in the affirmative.                                                                                           
                                                                                                                                
Co-Chair  MacKinnon referred  to  an order  of priority  for                                                                    
vetting those who owed the state  money in the form of court                                                                    
fines,  child  support,  etc. She  asked  whether  the  bill                                                                    
specifically   prevented  people   from  purchasing   raffle                                                                    
tickets if they had fiduciary obligations to the state.                                                                         
                                                                                                                                
Ms.  Race stated  that  involuntary  deductions were  always                                                                    
taken  out   first;  the  administration   recommended  that                                                                    
language be  written into the bill  that addressed voluntary                                                                    
deductions.                                                                                                                     
                                                                                                                                
2:09:34 PM                                                                                                                    
Co-Chair MacKinnon  said that the  bill would be  held until                                                                    
the language was inserted. She  requested that Ms. Race work                                                                    
with the bill sponsor to update the legislation.                                                                                
                                                                                                                                
2:10:05 PM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon noted that  there were multiple voluntary                                                                    
deductions  that  could  be  made, and  she  hoped  to  hear                                                                    
recommendations  from the  administration and  the committee                                                                    
in the immediate future.                                                                                                        
                                                                                                                                
Senator  Micciche probed  the prioritization  of deductions,                                                                    
whether voluntary or involuntary.                                                                                               
                                                                                                                                
Ms. Race  specified that garnishments  would always  be paid                                                                    
out first, then the  university college savings program, any                                                                    
funds  available   after  that   would  be   distributed  to                                                                    
Pick.Click.Give recipients in the order they were selected.                                                                     
                                                                                                                                
2:11:43 PM                                                                                                                    
                                                                                                                                
Senator von  Imhof thought  it would make  sense to  put the                                                                    
raffle alongside the Pick.Click.Give  program as a voluntary                                                                    
donation to education.                                                                                                          
                                                                                                                                
2:12:20 PM                                                                                                                    
                                                                                                                                
Senator Micciche  agreed with the payment  priority list set                                                                    
out by the  administration. He thought that it  needed to be                                                                    
decided  whether  the  raffle  would come  before  or  after                                                                    
Pick.Click.Give on the priority list.                                                                                           
                                                                                                                                
Ms. Race agreed.                                                                                                                
                                                                                                                                
2:12:52 PM                                                                                                                    
                                                                                                                                
Co-Chair  MacKinnon  asked  whether   the  sponsor  had  any                                                                    
recommendations.                                                                                                                
                                                                                                                                
Vice-Chair  Bishop appreciated  the conversation  and stated                                                                    
that  he  was  open  to  the  committee's  thoughts  on  the                                                                    
legislation.                                                                                                                    
                                                                                                                                
Senator  Micciche feared  that the  raffle could  take funds                                                                    
away  from  organizations  already  in  the  Pick.Click.Give                                                                    
program, which could  result in the state having  to pay for                                                                    
additional services.                                                                                                            
Co-Chair  MacKinnon reiterated  that involuntary  deductions                                                                    
already  had a  priority payment  written into  statute. She                                                                    
stated  that  the  issue  to   consider  was  how  to  order                                                                    
voluntary contributions for payment.                                                                                            
                                                                                                                                
2:15:00 PM                                                                                                                    
                                                                                                                                
Vice-Chair Bishop  referred to  $388 million  spent annually                                                                    
on raffle tickets in the state.                                                                                                 
                                                                                                                                
Senator von Imhof  wondered whether there could be  a way to                                                                    
let an  applicant know when  they had exhausted  their total                                                                    
dividend and had no more available funds to donate                                                                              
                                                                                                                                
Ms. Race  replied in  the negative. She  stated that  at the                                                                    
point  in  time  that  the dividend  application  was  being                                                                    
administered, the amount of the  dividend was not known. She                                                                    
continued  that  individuals  selected  their  contributions                                                                    
based on a projected dividend amount.                                                                                           
                                                                                                                                
2:17:20 PM                                                                                                                    
                                                                                                                                
Co-Chair  MacKinnon  asked  whether statute  allowed  for  a                                                                    
prorated reduction  of a Pick.Click.Give. donation  when the                                                                    
actual dividend amount was less than the original donation.                                                                     
                                                                                                                                
Ms.  Race  stated that  the  distribution  of the  voluntary                                                                    
donations to  Pick.Click.Give would  have priority  based on                                                                    
the order in which the organizations were chosen.                                                                               
                                                                                                                                
2:18:52 PM                                                                                                                    
                                                                                                                                
Senator  Micciche  thought that  if  would  be difficult  to                                                                    
choose whether to donate to Pick.Click.Give or the raffle.                                                                      
                                                                                                                                
2:19:54 PM                                                                                                                    
                                                                                                                                
Vice-Chair Bishop agreed with Senator Micciche.                                                                                 
                                                                                                                                
Co-Chair  MacKinnon  stated that  with  the  support of  the                                                                    
sponsor,  she  would  draft a  committee  substitute,  which                                                                    
would be sent in a timely manner to offices for review.                                                                         
                                                                                                                                
Mr.  Fellman  spoke  to the  concern  addressed  by  Senator                                                                    
Micciche. He  thought that the language  could be structured                                                                    
to allow a person pinking  the lottery first and then picked                                                                    
an organization from Pick.Click.Give  then the lottery could                                                                    
be the last priority for payment.                                                                                               
                                                                                                                                
Co-Chair MacKinnon  wondered whether  a modification  in the                                                                    
prompting programming  for donations  would be  possible and                                                                    
queried  the  cost  of making  changes  to  the  application                                                                    
prompting programming.                                                                                                          
                                                                                                                                
Ms. Race  replied that modifying  the program  was possible.                                                                    
She felt  that further research  should done to  determine a                                                                    
specific  cost.  She  noted  that  Pick.Click.Give  and  the                                                                    
university savings program were  separate choices that would                                                                    
be  made when  applying for  a dividend,  the lottery  would                                                                    
create a third choice.                                                                                                          
                                                                                                                                
2:22:08 PM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon  hoped Ms. Race could  work with division                                                                    
programmers  to  understand  the  details and  cost  of  any                                                                    
necessary changes.                                                                                                              
                                                                                                                                
SB  78  was   HEARD  and  HELD  in   committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
2:23:17 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:23:56 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
SENATE BILL NO. 51                                                                                                            
                                                                                                                                
     "An Act extending the termination date of the Board of                                                                     
     Veterinary Examiners; and providing for an effective                                                                       
     date."                                                                                                                     
                                                                                                                                
2:23:59 PM                                                                                                                    
                                                                                                                                
Vice-Chair   Bishop  MOVED   to  ADOPT   proposed  committee                                                                    
substitute  for  SB  51,   Work  Draft  30-LS0465\U  (Bruce,                                                                    
4/7/17).                                                                                                                        
                                                                                                                                
Co-Chair MacKinnon OBJECTED for discussion.                                                                                     
                                                                                                                                
2:24:38 PM                                                                                                                    
                                                                                                                                
SHAREEN CROSBY, STAFF, SENATOR  NATASHA VON IMHOF, explained                                                                    
that the CS  would extend the termination date  of the Board                                                                    
of Veterinary Examiners.                                                                                                        
                                                                                                                                
Co-Chair MacKinnon  WITHDREW her  OBJECTION. There  being NO                                                                    
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
2:25:39 PM                                                                                                                    
                                                                                                                                
KRIS CURTIS, AUDITOR, DIVISION OF  LEGISLATIVE AUDIT, of the                                                                    
"Performance   Audit   of   the  Department   of   Commerce,                                                                    
Community,  and Economic  Development,  Board of  Veterinary                                                                    
Examiners", dated March 18, 2016  (copy on file). She stated                                                                    
that the board was serving  in the public's best interest by                                                                    
effectively  licensing  and   regulation  veterinarians  and                                                                    
veterinary   technicians.  She   said   that  the   division                                                                    
recommended  an  8-year  extension, which  was  the  maximum                                                                    
allowed for in statute.  She noted one recommendation, found                                                                    
on Page  7, that  the board chair  should review  the annual                                                                    
report   for   accuracy   and  completeness   before   final                                                                    
submission  to the  Department of  Commerce, Community,  and                                                                    
Economic  Development. She  noted the  schedule of  revenues                                                                    
and  expenditures  found  on  Page 6,  Page  5  contained  a                                                                    
schedule of licenses.                                                                                                           
                                                                                                                                
2:27:48 PM                                                                                                                    
                                                                                                                                
Co-Chair  MacKinnon referred  to the  chart on  Page 6;  she                                                                    
clarified that the board had a  surplus in its account in FY                                                                    
13,  which resulted  in a  decrease in  fees. She  expressed                                                                    
concern that the board was going to enter deficit spending.                                                                     
                                                                                                                                
Ms.  Curtis   replied  that  the  division   did  not  issue                                                                    
recommendations   if   the  department   had   appropriately                                                                    
increased  and decreased  fees in  the past  and appropriate                                                                    
action  was  expected  to  be   taken  in  the  future.  She                                                                    
explained  that  only  when  boards  failed  to  respond  to                                                                    
deficits and surpluses that recommendations were issued.                                                                        
                                                                                                                                
2:28:52 PM                                                                                                                    
                                                                                                                                
Co-Chair  MacKinnon   asked  why  the  fees   had  not  been                                                                    
increased in light of the looming deficit spending.                                                                             
                                                                                                                                
JANEY   HOVENDEN,   DIRECTOR,  DIVISION   OF   CORPORATIONS,                                                                    
BUSINESS   AND   PROFESSIONAL   LICENSING,   DEPARTMENT   OF                                                                    
COMMERCE,  COMMUNITY AND  ECONOMIC DEVELOPMENT,  stated that                                                                    
prior to  the last renewal  cycle, the fees had  been raised                                                                    
from $300 to $500. She said  that the board was in the black                                                                    
for FY 17 by $25,303.                                                                                                           
                                                                                                                                
Co-Chair MacKinnon  observed that in  FY 16 and FY  17 there                                                                    
had been a budget deficit carryforward.                                                                                         
                                                                                                                                
2:30:34 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:33:04 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair  MacKinnon clarified  that the  differences in  the                                                                    
legislative audit accounting versus  the department was that                                                                    
the  legislative audit  was calculating  through the  fiscal                                                                    
year,  while  the  department was  calculating  through  the                                                                    
calendar year.                                                                                                                  
                                                                                                                                
Ms. Hovenden restated that before  the last renewal cycle, a                                                                    
fee  analysis had  been conducted,  it  had been  determined                                                                    
that feed  needed to be  increased from $300  biannually, to                                                                    
$500 biannually.                                                                                                                
                                                                                                                                
Co-Chair  MacKinnon assured  the committee  that legislative                                                                    
audit and the  department would come to terms  on the actual                                                                    
numbers.                                                                                                                        
                                                                                                                                
2:34:14 PM                                                                                                                    
                                                                                                                                
Senator   Olson    asked   whether   there    were   ongoing                                                                    
investigations or complaints to licensees.                                                                                      
                                                                                                                                
Ms. Hovenden stated  that she would need  to investigate the                                                                    
issue and get back to the committee.                                                                                            
                                                                                                                                
2:34:40 PM                                                                                                                    
                                                                                                                                
Co-Chair  MacKinnon  reiterated that  the  CS  was a  simple                                                                    
extension bill.                                                                                                                 
                                                                                                                                
2:35:00 PM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon OPENED public testimony.                                                                                     
DR.  RACHEL   BERNGARTT,  BOARD  OF   VETERINARY  EXAMINERS,                                                                    
JUNEAU,  testified in  support of  the legislation  and that                                                                    
she  was  available for  questions.  She  believed that  the                                                                    
board  was functional,  unique,  and  necessary. She  shared                                                                    
that   the   board   regulated  licensees   and   veterinary                                                                    
technicians.  She shared  that  the  board offered  courtesy                                                                    
licenses for  veterinarians coming in the  state for special                                                                    
events and temporary licenses  for veterinarians coming from                                                                    
out of  state to  provide relief  service. She  relayed that                                                                    
all applications were forwarded to the board for review.                                                                        
                                                                                                                                
2:37:12 PM                                                                                                                    
                                                                                                                                
BRIAN  BERUBE,  ALASKA   NATIVE  TRIBAL  HEALTH  CONSORTIUM,                                                                    
ANCHORAGE (via  teleconference), called  in to speak  to the                                                                    
alteration  of  the make  up  of  the  board. He  hoped  for                                                                    
additional rural  input and  further discussion  on services                                                                    
in rural Alaska.                                                                                                                
                                                                                                                                
Co-Chair  MacKinnon   explained  that  the  issue   was  not                                                                    
discussed in the current legislation.                                                                                           
                                                                                                                                
Mr.  Berube  thought that  many  people  in the  state  were                                                                    
concerned about the issue and  wondered who he could talk to                                                                    
to bring the subject to light.                                                                                                  
                                                                                                                                
Co-Chair  MacKinnon restated  that the  current bill  was an                                                                    
extension bill  and that another piece  of legislation could                                                                    
be introduced  that proposed  to change the  make up  of the                                                                    
board.                                                                                                                          
                                                                                                                                
2:39:48 PM                                                                                                                    
                                                                                                                                
PAMELA SANASH,  SELF, NENANA (via teleconference),  spoke in                                                                    
opposition to  the bill.  She reiterated  previous testimony                                                                    
concerning  an amendment  in  another  committee that  would                                                                    
have changed the make-up of the current board.                                                                                  
                                                                                                                                
Co-Chair  MacKinnon   restated  that   the  issue   was  not                                                                    
discussed in the current committee substitute.                                                                                  
                                                                                                                                
Ms. Sanash testified in support of  a sunset of the board in                                                                    
2  years.  She  also  suggested that  the  board  should  be                                                                    
completely    dismantled.    She   said    that    traveling                                                                    
veterinarians  to her  rural community  had been  blocked by                                                                    
the board,  which had  resulted in danger  to the  human and                                                                    
animal public. She  believed that the board  was corrupt and                                                                    
should be reduced  or abolished. She lamented  that her area                                                                    
had  been without  animal vaccinations  for 2  years because                                                                    
traveling veterinarians could  not obtain courtesy licensure                                                                    
through the board.                                                                                                              
                                                                                                                                
2:44:06 PM                                                                                                                    
                                                                                                                                
LEA MCKENZIE,  SELF, SUTTON (via  teleconference), testified                                                                    
in  opposition to  the bill.  She  echoed previous  concerns                                                                    
about traveling veterinarians  obtaining licensure; she said                                                                    
that they  were not  flat out  denied but  were not  made to                                                                    
feel welcome, either.                                                                                                           
                                                                                                                                
2:46:47 PM                                                                                                                    
                                                                                                                                
ROMAINE    KOBILSEK,    SPAY   ARKANSAS,    ARKANSAS    (via                                                                    
teleconference), testified  in opposition  to the  bill. She                                                                    
expressed concern for  the long tern extension  of the board                                                                    
given  the   current  non-welcoming  climate  and   the  fee                                                                    
schedule. She argued  that the board was not  working in the                                                                    
best interest of  the state by increasing  the fee schedule,                                                                    
which  made it  difficult  for  non-profit veterinarians  to                                                                    
afford to  provide services  in the  state. She  argued that                                                                    
traveling veterinarians  provided services for  animals that                                                                    
would otherwise go without.                                                                                                     
                                                                                                                                
2:51:12 PM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon CLOSED public testimony.                                                                                     
                                                                                                                                
2:52:03 PM                                                                                                                    
                                                                                                                                
Vice-Chair Bishop  asked whether  Ms. Berngartt  agreed with                                                                    
the 8-year extension proposed in the bill.                                                                                      
                                                                                                                                
Dr.  Berngartt replied  in  the  affirmative. She  specified                                                                    
that all  50 states had boards  that regulated veterinarians                                                                    
and veterinary technicians.                                                                                                     
                                                                                                                                
2:52:33 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:52:53 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair MacKinnon shared that  the current bill version had                                                                    
a narrow scope  but that she would allow  for questions that                                                                    
pertained to previous versions.                                                                                                 
                                                                                                                                
Vice-Chair  Bishop  expressed  concern for  animal  care  in                                                                    
rural  Alaska.  She  wondered whether  the  board  supported                                                                    
veterinarians from out of state  providing services in rural                                                                    
Alaska.                                                                                                                         
                                                                                                                                
Dr. Berngartt confirmed that receiving  animal care in rural                                                                    
Alaska was difficult.  She said that board  members were not                                                                    
aware where  people intended to  practice when  they applied                                                                    
for a permanent  license. She argued that the  board did not                                                                    
control courtesy license fees.                                                                                                  
                                                                                                                                
2:56:14 PM                                                                                                                    
                                                                                                                                
Dr. Berngartt  disagreed with the  statement that  the board                                                                    
was  not welcoming  to outside  veterinarians. She  asserted                                                                    
that   the  same   criteria  were   used  to   review  every                                                                    
application  and that  board members  did not  make personal                                                                    
judgements  about  applicants.  She  said  that  a  courtesy                                                                    
license  for a  special event  had  never been  denied to  a                                                                    
qualified  applicant. She  stressed that  the powers  of the                                                                    
board  were   outlined  in   statute  and   regulation.  She                                                                    
explained that  the job  of the board  was to  regulate, not                                                                    
recruit, licensees.  She relayed that the  Alaska Veterinary                                                                    
Rural Outreach  was a private  non-profit in the  state that                                                                    
practiced  sterilization of  animals. She  added that  other                                                                    
outside companies  that wanted  to work  in the  state could                                                                    
obtain  the courtesy  license -  highlighting the  fees were                                                                    
not  set  by  the  board.  She  said  that  outside  experts                                                                    
conducting  scientific research  were required  to obtain  a                                                                    
courtesy license.  She concluded that the  requirements were                                                                    
not  targeting rural  veterinarians  but  were covering  the                                                                    
cost  of   operating  the  board.  She   lamented  that  the                                                                    
licensure  was   expensive  but  felt  that   the  necessity                                                                    
outweighed the expense.                                                                                                         
                                                                                                                                
2:58:43 PM                                                                                                                    
                                                                                                                                
Vice-Chair Bishop  expressed discomfort about  licensees not                                                                    
disclosing where they would be practicing, specifically.                                                                        
                                                                                                                                
Dr. Berngartt clarified  that specifics had to  be given for                                                                    
courtesy  licensure but  that  temporary  licensees did  not                                                                    
have to provide the same detail.                                                                                                
                                                                                                                                
Vice-Chair  Bishop asked  whether the  board might  consider                                                                    
adding  a   request  for  information  regarding   where  an                                                                    
applicant would be practicing.                                                                                                  
                                                                                                                                
Ms.  Berngartt   expressed  confusion   with  the   line  of                                                                    
questioning.                                                                                                                    
                                                                                                                                
3:00:01 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Bishop  continued  discussing  the  question  of                                                                    
temporary  licenses  and  where  applicants  might  practice                                                                    
under  those  licenses.  He wondered  whether  it  would  be                                                                    
helpful  to  ask  temporary license  recipients  where  they                                                                    
anticipated practicing.                                                                                                         
                                                                                                                                
Dr.  Berngartt  replied  that temporary  veterinary  license                                                                    
application required naming the  practice that the applicant                                                                    
would  be filling  in for;  however, occasionally  practices                                                                    
did  outreach  clinics in  area  outside  of their  physical                                                                    
location.  She  thought  that it  could  be  restrictive  to                                                                    
veterinarians  to  anticipate  every  physical  location  of                                                                    
practice.                                                                                                                       
3:01:24 PM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon  recalled public testimony  from Arkansas                                                                    
that licensing fees had  been inappropriately increased. She                                                                    
asked whether the state had  the statutory power to increase                                                                    
fees or if it was the responsibility of the board.                                                                              
                                                                                                                                
Ms. Hovenden  stated that AS  08.01.065 stipulated  set fees                                                                    
that approximated  the cost of  the program. She  added that                                                                    
the division considered advise from  the board regarding fee                                                                    
changes. She  relayed that the  fee schedule  was ultimately                                                                    
the  responsibility of  the state.  She noted  the program's                                                                    
past deficit,  had lead  to the rise  in fee.  She furthered                                                                    
that the courtesy license fee  was less because it covered a                                                                    
shorter duration of coverage.                                                                                                   
                                                                                                                                
Co-Chair MacKinnon  stated that  it had been  suggested that                                                                    
the state was charging fees  for veterinarians coming to the                                                                    
state to perform a public  service. She wondered whether all                                                                    
of the fees associated with the practice were justified                                                                         
                                                                                                                                
Ms.  Hovenden  relayed  that  all  applicants  went  through                                                                    
identical screening and required board approval.                                                                                
                                                                                                                                
Dr. Berngartt  affirmed that all  licensing was  reviewed in                                                                    
the same manner.                                                                                                                
                                                                                                                                
Co-Chair  MacKinnon   queried  the  timeline   and  possible                                                                    
challenges for the licensing process.                                                                                           
                                                                                                                                
3:05:23 PM                                                                                                                    
                                                                                                                                
Dr. Berngartt said  that she could not speak  to having ever                                                                    
missed a  deadline or  failed to license  an applicant  in a                                                                    
timely  manner.  She  could   not  speak  to  the  licensing                                                                    
practices  of other  states. She  said that  if people  were                                                                    
under investigation for misconduct  - states did communicate                                                                    
on the matter.                                                                                                                  
                                                                                                                                
Ms. Hovenden had found that  since 2012, through March 2017,                                                                    
there had been no courtesy licenses denied.                                                                                     
                                                                                                                                
3:06:56 PM                                                                                                                    
                                                                                                                                
Senator Micciche  understood that the bill  would extend the                                                                    
termination  date   of  the  board   but  that   the  issues                                                                    
surrounding  veterinary  practices  in the  state  could  be                                                                    
approached through specific legislation.  He offered to help                                                                    
to work  to craft solutions  for problems in rural  areas of                                                                    
the state.                                                                                                                      
                                                                                                                                
3:08:18 PM                                                                                                                    
                                                                                                                                
Senator Olson  asked whether the veterinary  community had a                                                                    
national databank for licensees.                                                                                                
                                                                                                                                
Dr. Berngartt stated that there  was an American Association                                                                    
of State Veterinary Boards but  thought that there was not a                                                                    
national database.  She continued  that every state  had its                                                                    
own licensing exam and standards.                                                                                               
                                                                                                                                
3:10:41 PM                                                                                                                    
                                                                                                                                
Senator  Olson asked  for commentary  on the  testimony that                                                                    
had recommended a shorted board extension.                                                                                      
                                                                                                                                
Dr.  Berngartt  thought  that  the  testifier  was  possibly                                                                    
misinformed of  the term limits  for board members.  She did                                                                    
not believe that  the board should be  involved in dictating                                                                    
where  veterinarians practiced  in the  state. She  believed                                                                    
that  communities needed  to develop  strategies to  provide                                                                    
veterinary services  in their areas.  She stressed  that the                                                                    
board could not provide direct services.                                                                                        
                                                                                                                                
3:12:45 PM                                                                                                                    
                                                                                                                                
Vice-Chair Bishop  asked whether an individual  homeowner in                                                                    
rural  Alaska   could  administer   a  vaccination   with  a                                                                    
hypodermic needle.                                                                                                              
                                                                                                                                
Dr.  Berngartt  specified  that  there  were  vaccines  that                                                                    
individuals  could  order  but there  were  quality  control                                                                    
issues.  She  added  that   private  individuals  could  not                                                                    
administer  the rabies  vaccine at  home. She  recalled that                                                                    
there had been a lay  vaccinator program, which had provided                                                                    
the  vaccine,  training,  and  refrigeration  but  that  the                                                                    
program had been discontinued due  to funding and liability.                                                                    
She  thought that  the question  should be  directed to  the                                                                    
Department of Epidemiology.                                                                                                     
                                                                                                                                
3:14:17 PM                                                                                                                    
                                                                                                                                
Senator  Micciche  relayed that  he  was  ok with  the  bill                                                                    
moving forward.                                                                                                                 
                                                                                                                                
Co-Chair MacKinnon  thought that the  bill could be  used to                                                                    
address the proper licensure needed  to ensure proper animal                                                                    
care in the state.                                                                                                              
                                                                                                                                
3:15:44 PM                                                                                                                    
                                                                                                                                
Co-Chair  MacKinnon drew  attention  to the  Page  4 of  the                                                                    
audit findings:                                                                                                                 
                                                                                                                                
     Two   regulatory   changes   improved   and   increased                                                                    
     veterinary services in  bush communities. Regulation 12                                                                    
     AAC  68.041  added  spay-and   neuter  clinics  to  the                                                                    
     courtesy  license  definition  of special  event.  This                                                                    
     allows  visiting  veterinarians  to  provide  spay-and-                                                                    
     neuter  services  in  bush  communities.  Additionally,                                                                    
     regulation 12 AAC  68.300 amended veterinary technician                                                                    
     duties  to   allow  licensed   veterinary  technicians,                                                                    
     employed  by   a  licensed  veterinarian,   to  receive                                                                    
     guidance   remotely   while   providing   services   in                                                                    
     communities with no established veterinary practice.                                                                       
                                                                                                                                
Co-Chair  MacKinnon  asked   whether  there  was  additional                                                                    
information in the audit regarding rural communities.                                                                           
                                                                                                                                
Ms.  Curtis stated  that the  audit had  been structured  to                                                                    
examine  the rural  issue during  the planning  phase, field                                                                    
work  had been  done  to  see what  the  board  had done  in                                                                    
response to  the concerns, it  had been identified  that the                                                                    
board had  acted to change regulation  and make improvements                                                                    
in the area.                                                                                                                    
                                                                                                                                
3:17:23 PM                                                                                                                    
                                                                                                                                
Senator Micciche wondered which  agency the committee should                                                                    
work with to answer the concerns of rural Alaska.                                                                               
                                                                                                                                
Ms. Curtis thought there was  a state veterinarian, employed                                                                    
by the state, who would be a resource for rural Alaskans.                                                                       
                                                                                                                                
Senator  Micciche appreciated  the  testifier from  Arkansas                                                                    
and spoke to the vast size of the state.                                                                                        
                                                                                                                                
Co-Chair MacKinnon  stated that the committee  could discuss                                                                    
the fiscal note the following day.                                                                                              
                                                                                                                                
Co-Chair MacKinnon discussed housekeeping.                                                                                      
                                                                                                                                
ADJOURNMENT                                                                                                                   
3:20:23 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 3:20 p.m.                                                                                          
                                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects
SB 51 Public Testimony Lynn.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB 51 Public Testimony Mckenzie.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB 51 Public Testimony Hall.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB 51 Public Testimony Packet.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB 51 Public Testimony Ross.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB 51 Public Testimony Zimmerman.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB51 Legislative Audit.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB51 Letter of Support.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB51 Sponsor Statement.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB 51 support public member on the Alaska Veterinary board House.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB 51 - Support for Rural Public Representation on the Alaskan Veterinary Board Hemen.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB 45 Wrok Draft CS SB 45 FIN v. O.pdf SFIN 4/11/2017 1:30:00 PM
SB 45
SB 45 CS SB 45 FIN v. O Explanation.pdf SFIN 4/11/2017 1:30:00 PM
SB 45
SB 51 Work Draft FIN CS SB 51 v.U.pdf SFIN 4/11/2017 1:30:00 PM
SB 51
SB 78 Legal Opinion - Donation v. Contribution.pdf SFIN 4/11/2017 1:30:00 PM
SB 78
SB 78 CS SB 78 v.M Explanation.pdf SFIN 4/11/2017 1:30:00 PM
SB 78
SB 78 - Sample Payouts.pdf SFIN 4/11/2017 1:30:00 PM
SB 78
SB 78 Work Draft CS SB 78 v.M.pdf SFIN 4/11/2017 1:30:00 PM
SB 78
HB 48 Sponsor Statement.pdf SFIN 4/11/2017 1:30:00 PM
HB 48
HB 48 Supporting Letters.pdf SFIN 4/11/2017 1:30:00 PM
HB 48
HB 48 Supporting Document Sunset Audit.pdf SFIN 4/11/2017 1:30:00 PM
HB 48