Legislature(2009 - 2010)SENATE FINANCE 532
03/26/2010 01:30 PM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB92 | |
| SB264 | |
| SB234 |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 300 | TELECONFERENCED | |
| += | HB 302 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 92 | TELECONFERENCED | |
| += | SB 234 | TELECONFERENCED | |
| += | SB 264 | TELECONFERENCED | |
SENATE FINANCE COMMITTEE
March 26, 2010
1:39 p.m.
1:39:17 PM
CALL TO ORDER
Co-Chair Stedman called the Senate Finance Committee
meeting to order at 1:39 p.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Charlie Huggins, Vice-Chair
Senator Dennis Egan
Senator Donny Olson
Senator Joe Thomas
MEMBERS ABSENT
Senator Johnny Ellis
ALSO PRESENT
Quinn Kendall, Staff, Senator Bettye Davis; Barry Fadem,
President, National Popular Vote; Senator John Coghill,
District F; Lela Klingert, President, Alaska Commercial
Fishing and Agriculture Bank; Senator Kevin Meyer; Pat
Davidson, Legislative Auditor, Legislative Audit Division,
Legislative Affairs Agency.
PRESENT VIA TELECONFERENCE
Cam Carlson, Self, Fairbanks; Randy Griffin, Self,
Fairbanks; Ralph Stevenson, Self, Anchorage; Trent England,
Save Our State Project, Washington; Tara Ross, Self,
Anchorage; Jim Gillef, Self, Anchorage; Stephan Peterson,
Self, Anchorage; Debbie Joslin, Eagle Forum Alaska, Eagle
River; Rob Carlson, Self, Fairbanks; Rex Goolsby, Self,
Tok; Shirley Gifford, Alcohol Beverage Compliance.
SUMMARY
SB 92 U.S. PRESIDENTIAL ELECTION COMPACT
SB 92 was HEARD and HELD in Committee for further
consideration.
SB 264 COMMERCIAL FISHING & AGRICULTURE BANK
SB 264 was HEARD and HELD in Committee for
further consideration.
SB 234 EXTEND ALCOHOLIC BEVERAGE CONTROL BOARD
SB 234 was HEARD and HELD in Committee for
further consideration.
SENATE BILL NO. 92
"An Act ratifying an interstate compact to elect the
President and Vice-President of the United States by
national popular vote; and making related changes to
statutes applicable to the selection by voters of
electors for candidates for President and Vice-
President of the United States and to the duties of
those electors."
1:39:36 PM
Co-Chair Stedman introduced SB 92.
QUINN KENDALL, STAFF, SENATOR BETTYE DAVIS, discussed the
legislation.
The U.S. Constitution gives each state exclusive
control over the manner of awarding each state's
electoral votes. The current winner-take-all rule
practiced by 48 states is not in the constitution. The
fact that Maine and Nebraska award electoral votes by
Congressional district, is a reminder that electing a
president is a state's right issue, and does not
require an amendment to the U.S. Constitution.
Under the National Popular Vote Interstate Compact
bill, all the electoral votes from the enacting states
would be awarded, as a bloc, to the presidential
candidate who receives the most popular votes in all
50 states (and DC). The bill would take effect only
when enacted by states possessing a majority of the
electoral votes - that is 270 of 538, enough electoral
votes to elect a President.
During previous hearings the question has been raised
"Will a National Popular Vote be good for small
populated states like Alaska?" The answer to this
question is emphatically 'yes,' it would be tremendous
for a state like Alaska. And with your indulgence,
I'll briefly explain why.
Our relevance as a state in electing the President is
governed solely by whether we are "winnable" or "not"
to a candidate. In other words, are we a
"battleground" state, like Iowa, Florida, Ohio and New
Hampshire? In those states, the vote for President,
are very close, and therefore candidates' allot
copious amounts of campaign resources to win those
states. In Alaska there are no similar efforts taken
by candidates because we are not a closely contested
state. In fact, Alaska has not been visited by a
presidential candidate since Kennedy and Nixon arrived
over 50 years ago.
Additional evidence supports the need for SB 92s
passage. In past elections candidates have won the
Presidency without winning the most popular votes
nationwide. This has occurred in 4 of the nation's 56
presidential elections (or, 1 in 7 of the non-
landslide elections). In 2004, a shift of fewer than
60,000 votes in Ohio would have defeated President
Bush despite his substantial nationwide lead of 3 ½
million votes.
In conclusion, SB 92s sole purpose is to ensure that a
small populated state like ours would have hundreds of
thousands of votes that are Winnable, Important, and
Valuable to a presidential candidate. And ultimately,
whether its campaign spending in Alaska, or attention
being paid to our important states issues, the
National Popular Vote system is undeniably better for
Alaska.
1:43:44 PM
Senator Olson asked about the effect this legislation has
on minority groups throughout the nation. Mr. Kendall
responded that with this bill, each and every vote counts.
Senator Huggins asked if the function of the legislation is
to eliminate the Electoral College. Mr. Kendall answered
no.
Senator Huggins asked what the function of the Electoral
College would be under this legislation. Mr. Kendall
responded that with the Electoral College, each state is
designated a certain number of electoral votes. Each state
sends their electoral votes to the winner of the most votes
nationwide. Senator Huggins suggested that if the total
vote count has been tallied, then the Electoral College
would exist as a formality. Mr. Kendall agreed that the
Electoral College would be a formality.
1:46:18 PM
Senator Thomas struggled with the distinction this formula
provides when compared to the current method.
Senator Olson understood that a pool of states is joined by
the compact. He concluded that if Alaska joins the compact,
then electoral votes are added to the pool of compacted
states.
Co-Chair Stedman asked for an explanation of the compact
along with a list of states included. He asked about
marginalization for Alaska. Mr. Kendall responded that the
compact cannot be enacted until 270 electoral votes are
met. Currently there are five states enacting similar
legislation: Hawaii, Washington, Maryland, New Jersey, and
Illinois. Many people wonder how this bill will affect
Alaska as electoral votes were originally designed to
represent states with small populations. He noted that
Wyoming, which is also a small state, has three and one
half times more power in their Electoral College vote
compared to their population. Florida is inundated with
campaign visits because they are a battleground state. He
opined that the Electoral College is not working for Alaska
therefore Presidential Candidates do not care about
campaigning here.
1:50:46 PM
Senator Huggins estimated that the "best guarantee Alaska
has to get a Presidential candidate to visit is to have a
Presidential candidate."
CAM CARLSON, SELF, FAIRBANKS (via teleconference),
testified in opposition to the legislation. She opined that
the United States does not have a basic democracy, but
instead a representative republic. She stressed that the
legislation eliminates one of the country's basic forms of
government.
RANDY GRIFFIN, SELF, FAIRBANKS (via teleconference),
testified in opposition to SB 92. He explained that he
likes the Electoral College system because it accentuates
state boundaries and rights. He opined that state liberties
were at risk and the federal government has taken too much
power. The electoral system does benefit small states
because we get three electors to match the congressional
delegation, which he opined was generous in comparison to
the population.
1:56:24 PM
RALPH STEVENSON, SELF, ANCHORAGE (via teleconference),
testified in support of SB 92. He stressed the need for
legislation that allows each person's vote to count. The
national popular vote ensures that each individual's voice
is heard in a federal Presidential election. He believed
that the bill is right for Alaska and the compact is right
for our country.
TRENT ENGLAND, SAVE OUR STATE PROJECT, WASHINGTON (via
teleconference), testified in favor of the legislation. He
noted that the issue reaches far beyond the boundaries of
each state. He opined that presidential elections
recalibrate politics every four years. He discussed the
interstate compact, which he deemed extremely fragile
because it is not a change to the constitution.
TARA ROSS, SELF, ANCHORAGE (via teleconference), testified
in opposition to the legislation. She stated that a
nationwide discussion regarding the elimination of the
Electoral College is necessary. Alaska could be forced to
award its entire slate of electors to a candidate who is
not on the ballot. She cited further inconsistencies that
might skew election results.
2:03:15 PM
JIM GILLEF, SELF, ANCHORAGE (via teleconference), testified
in support of the legislation. He believed that the bill
allows the majority to rule and pulls the states together
increasing state's rights.
STEPHAN PETERSON, SELF, ANCHORAGE (via teleconference),
testified in support of SB 92. He stated that the
constitution is an evolving and living document. He
stressed that it is time for every citizen to be counted.
2:05:29 PM
DEBBIE JOSLIN, EAGLE FORUM ALASKA, DELTA JUNCTION (via
teleconference), testified in opposition to the
legislation. She opined that SB 92 would eliminate rights
for Alaskans to have a meaningful part in the election of
the President. Alaska's electors are pledged to vote for
the person who wins the national popular vote.
ROB CARLSON, SELF, FAIRBANKS (via teleconference),
testified in opposition of the legislation. He noted that
the bill would undermine Alaska's three electoral votes.
2:09:17 PM AT EASE
2:09:37 PM RECONVENE
BARRY FADEM, PRESIDENT, NATIONAL POPULAR VOTE, testified in
support of the legislation. He discussed the minority
issue. The National Association for the Advancement of
Colored People (NAACP) supports the national popular vote
proposal because African Americans in battleground states
represented 72 percent in 1976, which fell to 34 percent
for the last election. Hispanic groups face the same
dilemma. Issues for states without proper representation
due to their size are never discussed during presidential
campaigns. Six of the states are red and six are blue. He
believed that a vote cast in Juneau should be as important
as a vote cast in Miami, Florida. The size of the state is
irrelevant. Whether or not it is a battleground state is
the determining factor. He spoke to the argument that the
legislation eliminates the Electoral College. He stated
that the allegations were false. He believed that the
Electoral College is a rubberstamp for the vote in each of
the fifty states. The founding fathers decided in their
immanent wisdom to give state legislatures the power to
decide how to award the electoral votes. Under the
legislation's proposal, state action determines the method
of the election process. All reform regarding Presidential
elections begins at the state level.
2:13:52 PM
REX GOOLSBY, SELF, TOK (via teleconference), testified in
opposition of the legislation. The compromise of creating
the Electoral College was for the protection of small
states. He opined that the passage of the proposal would
benefit the states with large population centers.
2:19:23 PM
Co-Chair Stedman mentioned one zero fiscal note.
Mr. Kendall thanked the committee for the opportunity to
testify on behalf of SB 92. He stated that the goal of the
legislation was to benefit the entire country.
SB 92 was HEARD and HELD in Committee for further
consideration.
SENATE BILL NO. 264
"An Act relating to the board, investigations, and
examinations of the Alaska Commercial Fishing and
Agriculture Bank; and providing for an effective
date."
2:20:31 PM
SENATOR JOHN COGHILL discussed the legislation. He
explained that SB 264 addressed two different issues with
regard to the commercial fishing and agricultural bank. It
eliminates the requirement for the resident farmer and
places them under an examination of the Department of
Commerce, Community and Economic Development division of
banking for a review in intervals of thirty six months.
Senator Coghill provided a sectional analysis. He explained
that Section 1 adds the commercial fishing and agricultural
bank to the list of requirements for institutions. Section
two deletes the requirement of resident farmer for the
board of directors of the Commercial Fishing and
Agricultural Bank. Section three is the confidentiality
section of the records required when utilizing financial
information. The authority to audit is added under Title
44. Section 4 addresses the authorization for examinations
as the requirement for the Department of Commerce,
Community and Economic Development Banking Division Audits.
Section 5 is a repealer of the resident farmer language.
Section 6 addresses the immediate effect of the resident
farmer language by removing it altogether. Section 7
includes a later effective date that deals with the bank
examiner.
2:25:37 PM
Senator Olson asked why representation from the general
public was discouraged. Senator Coghill explained the
difficulty in finding qualified people to serve on the
board. The current requirement states that the seat cannot
be filled unless a resident farmer is found to sit on the
position. Senator Olson asked about the extension of the
interval. He asked how many loans are delinquent.
Co-Chair Stedman reviewed one fiscal note for $10,600 in
Commercial Fishing and Agricultural Bank (CFAB) receipts
to cover the cost of examination, travel and per diem.
Senator Coghill stated that the fiscal note anticipates
that CFAB would cover the cost listed in the fiscal note.
The fiscal note is a necessity for the auditors. The fiscal
note exhibits a reimbursable cost to the state.
2:27:34 PM
LELA KLINGERT, PRESIDENT, ALASKA COMMERCIAL FISHING AND
AGRICULTURE BANK delivered her testimony.
When CFAB was created by the Legislature in 1979 and
1980, there was considerable emphasis on the
development of agriculture in Alaska and there was
hope that CFAB would be a significant player in the
financing of that development. While CFAB has made
many agricultural loans, and continues to offer
agricultural loans today. However there have been
very few new agricultural loans made, or applications
received, in the last ten years. Because of this
CFAB's pool of eligible farmer members from which a
farmer director candidate can be recruited has
dwindled.
This has resulted in increasing pressures on the
individuals involved, on CFAB's other directors, and
on CFAB's efforts to maintain its viability and to
properly serve its various constituencies. Despite
the logical and well-intended requirement of the past,
it has now become critical for CFAB's members to reach
into the broad pool of its total membership, in order
to maintain the highest level of competence within its
governing body
With regard to the request for examination, it
admittedly may seem odd that a financial institution
would seek some new level(s) of oversight and/or
potential criticisms, especially where it will involve
new and uncontrollable financial costs.
CFAB represents a collection of diverse fiduciary
responsibilities. It borrows and lends money and it
operates as a cooperative corporation. Therefore, it
has a fiduciary obligation to those who have borrowed
in the past, those who borrower today, and to those
who borrow in the future. It also has a fiduciary
responsibility to the State of Alaska - First, because
it was a financial investment of the State (since
repaid) and, Second, because CFAB is the only private
enterprise with the authority to encumber a Commercial
Fishing Limited Entry Permit with a consensual lien.
CFAB's Board of Directors, Managements, and staff
members have always been sensitive to those diverse
fiduciary responsibilities. It is true that CFAB is
subject to, and welcomes, an annual financial audit by
a professional firm; but such audits are focused
primarily on quantitative values and accounting
protocols. Only peripherally, do they touch upon the
qualitative aspects of lending policies, practices,
and results. The State's bank examiners, however, are
trained in analytical and evaluative procedures, and
they are prepared to express a judgment, in each case,
as to the likelihood of a loan's repayment in full.
In addition, the examiners have access to the results
and experiences of numerous other financial
institutions and can establish norms or guidelines by
which CFAB's effectiveness can be measured. So, in
total, CFAB's Board of Directors and Management are
enthusiastic in their support of the measure at hand.
2:31:02 PM
Co-Chair Stedman requested information regarding defaults
or delinquencies. He asked to know the status of the loan
portfolio. Ms. Klingert stated that CFAB enjoys some of
its lowest delinquency rates in history at five percent.
Co-Chair Stedman requested more detailed and recent
information regarding the percent of the delinquencies in
dollar amounts.
Co-Chair Hoffman asked for the breakdown ratio between
commercial fisheries and agricultural loans.
Ms. Klingert responded that CFAB has less than $2 million
in agricultural loans in a portfolio of approximately $27
million loans.
2:32:20 PM
Senator Coghill appreciated the bill's consideration. He
believed that the legislation provided one way to improve
the lending institutions.
SB 264 was HEARD and HELD in Committee for further
consideration.
SENATE BILL NO. 234
"An Act extending the termination date of the
Alcoholic Beverage Control Board; and providing for an
effective date."
2:33:07 PM
SENATOR KEVIN MEYER explained the legislation.
AS 04.06.010 established the Alcoholic Beverage
Control Board (ABC Board) and provided for the
appointment of members by the governor. The ABC Board
consists of five members appointed by the governor and
confirmed by a majority of the members of the
legislature in joint session. Two members of the board
shall be persons actively engaged in the alcoholic
beverage industry; at least three members of the board
shall represent the general public.
SB 234, if enacted, would extend the ABC Board for one
year to June 30, 2011.
In the opinion of Legislative Audit, the Alcoholic
Beverage Control Board (ABC Board) should continue to
regulate the manufacture, sale, barter, and possession
of alcoholic beverages in Alaska in order to protect
the public's health, safety, and welfare. The Board
has demonstrated a need for its continued existence by
providing protection to the general public through the
issuance, renewal, revocation, and suspension of
liquor licenses. Protection has also been provided
through active investigation of suspected licensing
violations and enforcement of the state's alcoholic
beverage control laws and regulations.
During the review process of the sunset audit, there
were questions raised about the decision of the
Legislature to move the ABC Board from the Department
of Revenue to the Department of Public Safety. These
questions should be asked and the issue investigated
in depth. This one year extension will give the
Legislature time over the interim of 2010 to review
the decision and move forward with extending the Board
to 2014 as recommended by the Division of Legislative
Audit.
Senator Olson asked to know more about the difference in
the board's department. Senator Meyer responded that the
board has demonstrated a need for its continued existence
by providing protection to the general public. The
responsibilities of the board include the issuance,
renewal, suspension of liquor license, and active
investigation of suspected license violations and
enforcement of the estate's alcohol beverage control laws
and regulations. The review process of the sunset audit
raised questions about the decision of the legislature to
move the Alcohol Beverage Compliance (ABC) board from the
Department of Revenue (DOR) to the Department of Public
Safety (DPS). He requested additional time to investigate
the questions regarding the best home for the ABC board.
The original audit recommended board extension to 2014, but
he requested an extension of one year.
Senator Olson asked why Senator Meyer chose not to extend
the board for a longer time period as recommended by
Legislative Budget and Audit (LB&A). Senator Meyer informed
that the board may shift departments. The extension would
not allow the opportunity to move the board among the
departments.
Co-Chair Stedman mentioned one fiscal note from the
Department of Public Safety.
2:37:53 PM
SHIRLEY GIFFORD, DIRECTOR, ALCOHOL BEVERAGE COMPLIANCE (via
teleconference), expressed awareness of licensee's
dissatisfaction with the ABC board. She opined that an
extension of the ABC board offers stability. She explained
that she made recommended changes. She exemplified the
issues. She applauded the efforts of the agents and servers
who make the correct decisions. She anticipated that the
changes would be well received. She wished to provide an
agency that is supportive of licensees. She understood that
licensing and enforcement comprised the two aspects of ABC.
Without enforcement, laws will be broken. When people are
held accountable and responsible then they act accordingly.
Co-Chair Stedman noted the four recommendations listed in
the audit report. Ms. Gifford explained that one major
recommendation was an enforcement plan. The other item
concerned a procedural manual. She stated that she had
organized a ten year strategic plan. All three items have
been approved by the board of directors. She stated that
she was grateful to have the audit occur at the beginning
of her appointment. She explained that the audit allowed a
road map to efficiency for the operation of the agency.
2:43:41 PM
Co-Chair Stedman expressed concern about "sting operations"
with underage persons sent into a liquor establishment to
purchase alcohol. His concern included the risk associated
with the licensed premises operator and the effect on his
insurance premiums along with potential felony charges for
the bartender.
Ms. Gifford responded that she was also concerned about the
issue. She stated that Representative Ramras had a bill
that addressed minors using illegal identification. She
stated that law enforcement must retain the focus and
priority. She mentioned that she is a member of a committee
addressing statistical crime reporting. She was pleased to
be included because departments across the state should
report Title 4 violations.
2:47:19 PM
Co-Chair Stedman clarified several concerns about minors
testing the liquor establishment by attempting to purchase
liquor as part of a "sting operation." He understood that
it was illegal to have an underage minor in a liquor
establishment although the ramifications exist only for the
business proprietor and the bartender if they sell to the
minor.
Ms. Gifford responded that Title 4 for AS 41.60.490 covers
access of persons under the age of 21 to licensed premises.
She continued that Section F of the statute reads that a
person under 21 years of age does not violate the section
if the person enters or remains on premises licensed under
this title at the request of a police officer. She stated
that the ABC board is afforded the ability to do these
compliance checks. She explained that an increase in
compliance checks led to a decrease in violations. Co-Chair
Stedman responded that the shifting of the ABC board to the
Department of Public Safety has led to increased discomfort
among proprietors.
Ms. Gifford stated that the compliance check program was
not initiated because the ABC board was placed under the
Department of Public Safety. The compliance check program
occurs across the nation in an effort to combat underage
drinking.
2:51:55 PM
Co-Chair Hoffman pointed out number 4 and number 3 of the
audit recommendation. He referred to the policy stated in
number 4 addressing a board vote during a tie breaking
situation. Ms. Gifford responded that Alaska statute covers
this issue. Ms. Gifford believed that this statute should
be changed. She noted that she agrees with the auditors
because she is in a position where she has more information
than the board.
Co-Chair Hoffman mentioned number three and the compliance.
He asked if the board records were complete and accurate.
Ms. Gifford replied that the record keeping has improved
tremendously.
2:55:24 PM
Senator Olson asked how a tie might occur with a five
member board. Ms. Gifford answered that a tie might occur
if a member of the board was absent, as a quorum exists
with four people.
Senator Thomas asked how long Ms. Gifford had been the
director. Ms. Gifford answered that she has been the
director since January 5, 2009.
Senator Thomas asked about other issues in the audit. He
asked if the four agents employed by the ABC board were
sufficient. Ms. Gifford answered that she requested
additional investigators because of duties including
inspections of licensed premises and investigations for
violations of the law. She explained that she depends on
the state troopers for help.
2:58:01 PM
Senator Thomas commented on the audit and the compliance
check program. Ms. Gifford responded that the enforcement
of the strategic plan adds a mechanism limiting visits to
establishments.
Senator Thomas asked about mailings to the licensees. He
asked about the mailings and the cost to the state. Ms.
Gifford was not aware of state mailings, but agreed to
respond to Senator Thomas at a later date.
3:00:37 PM
Co-Chair Stedman wondered how much time is given to the
entity to achieve compliance prior to elimination.
PAT DAVIDSON, LEGISLATIVE AUDITOR, LEGISLATIVE AUDIT
DIVISION, LEGISLATIVE AFFAIRS AGENCY offered that the
improvements observed in the prior audit occurred under the
current executive director. She stated that the major issue
for LB&A was establishing quantifiable and objective
enforcement goals. Enforcement is a large segment of the
ABC board. Compliance checks should not be based on the
location of the inspectors. Issues about record retention
and data input are smaller issues and do not require
reorganization of the board.
Co-Chair Stedman asked about the potential extension of the
board. He asked if one year was ample time to come into
compliance with the audits.
Ms. Davidson stated that an extension of one year means
that LB&A will revisit the board and provide the committee
with a status of the current audit recommendations.
3:03:04 PM
SB 234 was HEARD and HELD in Committee for further
consideration.
ADJOURNMENT
The meeting was adjourned at 3:03 PM.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB92 Press[1].pdf |
SFIN 3/26/2010 1:30:00 PM |
SB 92 |
| SB92 Sponsor Statement[1].pdf |
SFIN 3/26/2010 1:30:00 PM |
SB 92 |
| SB 92 Sectional[1].pdf |
SFIN 3/26/2010 1:30:00 PM |
SB 92 |
| SB 264 2010 HB 159 2003 backup.pdf |
SFIN 3/26/2010 1:30:00 PM |
HB 159 SB 264 |
| SB 264 2010 Payments for Examinations.pdf |
SFIN 3/26/2010 1:30:00 PM |
SB 264 |
| SB 264 2010 Sectional.pdf |
SFIN 3/26/2010 1:30:00 PM |
SB 264 |
| SB 264 2010 Sponsor Statement.pdf |
SFIN 3/26/2010 1:30:00 PM |
SB 264 |
| SB92 Letters of Support.pdf |
SFIN 3/26/2010 1:30:00 PM SJUD 2/19/2010 1:30:00 PM |
SB 92 |
| SB 264 CFAB Mar 2003 Ltr HB 159.pdf |
SFIN 3/26/2010 1:30:00 PM |
HB 159 SB 264 |
| SB 264 Support Letter Huppert 2010.pdf |
SFIN 3/26/2010 1:30:00 PM |
SB 264 |
| SB 92 RNC letter of support.pdf |
SFIN 3/26/2010 1:30:00 PM |
SB 92 |
| SB92 Letters of Support[1].pdf |
SFIN 3/26/2010 1:30:00 PM |
SB 92 |
| SB 92 National Popular Vote 2010.pdf |
SFIN 3/26/2010 1:30:00 PM |
SB 92 |