Legislature(2003 - 2004)
02/24/2003 01:30 PM Senate HES
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ALASKA STATE LEGISLATURE
SENATE HEALTH, EDUCATION AND SOCIAL SERVICES
STANDING COMMITTEE
February 24, 2003
1:30 p.m.
MEMBERS PRESENT
Senator Fred Dyson, Chair
Senator Lyda Green, Vice Chair
Senator Gary Wilken
Senator Bettye Davis
Senator Gretchen Guess
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
SENATE BILL NO. 2
"An Act relating to recovery of civil damages from the parents
or legal guardian of a minor; and providing for an effective
date."
MOVED SB 2 OUT OF COMMITTEE
SENATE BILL NO. 25
"An Act relating to the teachers' housing loan program in the
Alaska Housing Finance Corporation; and providing for an
effective date."
MOVED CSSB 25(HES) OUT OF COMMITTEE
PREVIOUS ACTION
SB 2 - No previous action to consider.
SB 25 - No previous action to consider.
WITNESS REGISTER
Ms. Carol Comeau
Superintendent of Schools, Anchorage School District
PO Box 196614
Anchorage AK 99519
POSITION STATEMENT: Supported SB 2.
Mr. Jake Metcalfe
Anchorage School Board
Anchorage AK
POSITION STATEMENT: Supported SB 2.
Ms. Debbie Ossiander, President
Association of Alaska School Boards
PO Box 670772
Chugiak AK
POSITION STATEMENT: Supported SB 2 and SB 25.
Mr. Carl Rose, Executive Director
Association of Alaska School Boards
316 W 11th St.
Juneau AK 99801
POSITION STATEMENT: Commented on SB 2 and supported SB 25.
Mr. Bryan Butcher, Legislative Liaison
Alaska Housing Finance Corporation (AHFC)
Department of Revenue
PO Box 101020
Anchorage AK 99510-1020
POSITION STATEMENT: Commented on SB 25.
Mr. Paul Kapansky, Director
Mortgage Operations
Alaska Housing Finance Corporation (AHFC)
Department of Revenue
PO Box 101020
Anchorage AK 99510-1020
POSITION STATEMENT: Commented on SB 25.
Mr. Daniel Fauske, Executive Director
AHFC
Department of Revenue
PO Box 101020
Anchorage AK 99510-1020
POSITION STATEMENT: Commented on SB 25.
ACTION NARRATIVE
TAPE 03-5, SIDE A
Number 0001
SB 2-PARENT LIABILITY FOR DAMAGE BY CHILD
CHAIR FRED DYSON called the Senate Health, Education and Social
Services Standing Committee meeting to order at 1:30 p.m. and
announced SB 2 to be up for consideration. Present were Senators
Dyson, Guess, Davis and Wilken.
CHAIR DYSON, sponsor, said he was asked by at least one school
district in the state to remove the upper limit on the liability
of parents for malicious destruction of school property by their
children. Presently, the limit is $10,000 but, in several cases,
the cost of damage has been higher than that. Meanwhile, school
districts are already stretched to meet their financial
obligations.
MS. CAROL COMEAU, Superintendent, Anchorage School District,
supported SB 2 and said that the penalties are very minor for
the youth that commit these crimes. The case about the Dimond
High School damage was very high profile. The court awarded a
$158,000 judgment but it was reduced to a total of $10,000 to be
split between the two juveniles. The bills came in at $70,000
and the district in the process of trying to get a judgment from
the courts that is more in line with the actual costs.
The attitude of the families of youths involved in two out of
three cases is that they can't know where their children are all
the time and can't be held responsible for what they do. She
concluded:
We think that's the wrong message. We think the
message is damaging public facilities and not holding
them accountable for the damage takes money out of the
classroom and takes money away from the instructional
program and it sends the wrong message to young people
that these are not acceptable acts.
SENATOR LYDA GREEN arrived at 1:36 p.m.
MR. JAKE METCALFE, Anchorage School Board, supported SB 2. His
experience as a prosecutor leads him to believe that a higher
liability limit could have some deterrent effects. Last year,
about $300,000 worth of vandalism was done. When that cost can't
be recovered, the money comes out of the district's operating
budget.
SENATOR GREEN asked if the minor's name is currently included in
the judgment.
MR. METCALFE replied that he assumed that minors' names wouldn't
be used, but initials might be.
CHAIR DYSON asked him if the parents could get bankruptcy
protection so that they would not lose their homes, vehicles and
tools of their trade.
MR. METCALFE replied that he assumed so.
CHAIR DYSON said he assumes the judge would be willing to work
out some sort of extended payment plan and maybe the school
district could live with that.
MR. METCALFE responded that he thought it was the type of
situation where they would work to try and get as much as they
could and settle it.
SENATOR GREEN asked with the reference to a homeowner's policy,
whether he was talking about the liability of the child.
MR. METCALFE replied the parents [would be] responsible for the
children.
SENATOR GREEN asked what experience he had with the limits of
that kind of liability.
MR. METCALFE replied not a lot, adding that he didn't practice
that kind of law.
SENATOR GREEN said she thought it was limited to children under
12 years of age.
SENATOR GARY WILKEN said he understood the purpose of the
legislation, but he was concerned about collateral damage and
gave the example of a middle class family - husband and wife, 40
years old, three kids - one of them goes sideways and does
something equal to the experience in Anchorage.
We've got to absolutely knock some heads and $10,000
isn't a head knocking to me...but $100,000 or $150,000
that puts in jeopardy their house, their home, the
other two kids and the family is trying to get along
and that bothers me.
The open-endedness of the legislation concerned him, but he
thought they might be able to get the same effect without the
downside.
CHAIR DYSON responded that bankruptcy laws will protect the
family from losing their home, the tools of their business and a
vehicle. He added, "So they're not going to be out in the
street...."
SENATOR GRETCHEN GUESS said she didn't see any reference to the
child in the legislation and whether the child had any or may
have assets in the future. She asked if that omission was
intentional.
CHAIR DYSON replied that he didn't understand how minor children
could own assets apart from their parents. He assumed whatever
the parents could work out with the child would be up to them.
Under the state code, if a parent or a legal guardian of an
unemancipated minor under 18 has that child run away and reports
him as a runaway, the parents are off the hook.
SENATOR GREEN asked if the child could be named in the future,
upon adulthood. She didn't think that would be cruel and
unusual.
MS. DEBBIE OSSIANDER, President, Association of Alaska School
Boards (AASB), said this issue is supported by AASB's general
membership. Many schools had experienced vandalism in excess of
$10,000. Mountain Village School, for example, had a fire set
to cover the theft of a soda machine and the school burned down.
Costs resulting from actions like that are a serious concern.
MR. CARL ROSE, Executive Director, Association of Alaska School
Boards, supported SB 2. He explained that the state has varying
levels of indemnification, but all school districts are required
to have insurance. There are issues of deductibles, however, and
the Anchorage [school district], for one, has a $1 million
deductible insurance policy. Almost anything under that comes
out of their general fund. In 1992-1996, rural schools across
the state claimed $34 million in losses, including a lot of
vandalism. Any large loss has a large impact on the insurance
market.
CHAIR DYSON said a question came up about liability for foster
parents and the law is quite clear that as long as the child is
a ward of the state, the parents incur no liability.
SENATOR GUESS asked if the state would incur those expenses.
CHAIR DYSON answered yes.
SENATOR GARY WILKEN moved to pass SB 2 from committee with
individual recommendations and the attached fiscal note. There
were no objections and it was so ordered.
SB 25-AHFC LOANS TO EDUCATORS
CHAIR FRED DYSON said that SB 25 would be up for consideration.
SENATOR GARY WILKEN noted that a committee substitute labeled
23-LS0080\H, dated 2/21/03, was prepared. It designates single-
family housing only on line 9, and sets out who is covered on
lines 11 - 14. A provider of related services is covered but
not named in the bill, but it includes physical therapists,
occupational therapists, speech therapists, librarians or a
school nurse as long as they possess one of the state-required
certificates.
SENATOR WILKEN moved to adopt the committee substitute. There
were no objections and it was so ordered.
MR. BRIAN BUTCHER, legislative liaison, Alaska Housing Finance
Corporation (AHFC), said he was present to answer questions.
SENATOR LYDA GREEN said she had concerns about the lack of
requirements in the bill. It contains no requirement that need
be established, no limit on location, no requirement to continue
teaching, no limit to a one-time only loan, no first-time buyer
limitation, no age factor and no upper limit on price. She asked
if those things are in the terms and conditions mentioned on
page 2, paragraph (b), or whether they have to be spelled out in
the bill.
MR. PAUL KAPANSKY, director, Mortgage Operations, answered that
the department envisioned the program would overlay its existing
programs. For example, if the individual borrower qualified for
the first-time homebuyers program, he would also meet the
requirements of this program and be able to get a loan for 100%
loan to value. It would work the same for the veterans and rural
programs.
SENATOR GREEN asked if there is any requirement in the
legislation that it pertains to first-time buyers and whether
that language needs to be in statute.
MR. DANIEL FAUSKE, Executive Director, AHFC, explained that
typically, people will qualify for a number of different
programs and then they decide which one they want to use. This
bill removes the need for a down payment because a major
impediment for most people when purchasing a home is the down
payment requirement.
He said the issue of what to do if a borrower quit the teaching
profession was discussed internally and it was decided that
would be very hard to police. Their rural lending program
requires that a teacher be housed in each one of the units,
whether it's a duplex or a four-plex, and AHFC has the option of
increasing the interest back up to what it would have been if
that requirement isn't met.
SENATOR GREEN asked what the upper limit is on the amount of the
loan.
MR. FAUSKE replied that depends on what a person can afford to
borrow.
SENATOR BETTYE DAVIS asked if land had been identified in
various areas where these houses could be built.
MR. FAUSKE replied that they hadn't envisioned this bill as
covering going out and building homes.
SENATOR DAVIS asked if he was saying that land was too
expensive.
MR. FAUSKE elaborated that he was working with the Denali
Commission and the U.S. Department of Agriculture to find
available funding for land, but one has to consider the
infrastructure that is needed for development as well and that
is a factor in many rural areas.
SENATOR WILKEN asked if this is a one-time only bill. He gave
the example of a teacher moving to Fort Yukon to teach and
buying a home under this bill and then moving to teach in
Fairbanks. He wanted to know if he would have to use the assets
built up on the first loan to finance the new one.
MR. FAUSKE replied that he thought that teacher would be able to
use this program again.
SENATOR GREEN said she didn't think a person would have any
equity in two years with a "no-down."
MR. FAUSKE agreed.
MS. OSSIANDER said the AASB's top priorities are fair and
equitable funding and providing ways to help with teacher
recruitment and retention. At its meeting yesterday, the AASB
unanimously supported this bill.
MR. ROSE indicated his support also.
SENATOR WILKEN moved to pass CSSB 25(HES), version 23-LS0080\H,
from committee with individual recommendations. There were no
objections and it was so ordered.
CHAIR DYSON adjourned the meeting at 2:15 p.m.
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