Legislature(1995 - 1996)

03/22/1995 01:37 PM JUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                   SENATE JUDICIARY COMMITTEE                                  
                         March 22, 1995                                        
                           1:37 p.m.                                           
                                                                               
  MEMBERS PRESENT                                                              
                                                                               
 Senator Robin Taylor, Chairman                                                
 Senator Lyda Green, Vice-Chairman                                             
 Senator Mike Miller                                                           
 Senator Al Adams                                                              
 Senator Johnny Ellis                                                          
                                                                               
  MEMBERS ABSENT                                                               
                                                                               
 None                                                                          
                                                                               
  COMMITTEE CALENDAR                                                           
                                                                               
 CS FOR SENATE BILL NO. 87(CRA)                                                
 "An Act relating to community local options for control of                    
 alcoholic beverages; relating to the control of alcoholic                     
 beverages; relating to the definition of 'alcoholic beverage';                
 relating to purchase and sale of alcoholic beverages; relating to             
 alcohol server education courses; and providing for an effective              
 date."                                                                        
                                                                               
 SENATE BILL NO. 122                                                           
 "An Act excluding certain direct sellers of consumer products from            
 coverage under the state unemployment compensation laws."                     
                                                                               
 CS FOR HOUSE BILL NO. 9(FIN)                                                  
 "An Act relating to recovery of damages from a person having legal            
 custody of a minor when property is destroyed by the minor, and to            
 recovery from a minor's permanent fund dividend for injury or                 
 damage caused by the minor."                                                  
                                                                               
 CS FOR SENATE BILL NO. 85(STA)                                                
 "An Act making corrective amendments to the Alaska Statutes as                
 recommended by the revisor of statutes; and providing for an                  
 effective date."                                                              
                                                                               
 SENATE JOINT RESOLUTION NO. 14                                                
 Proposing an amendment to the Constitution of the State of Alaska             
 relating to certain public corporations.                                      
                                                                               
  PREVIOUS SENATE COMMITTEE ACTION                                             
                                                                               
 SB 87 - See Community & Regional Affairs minutes dated                        
         3/8/95 & 3/17/95.                                                     
                                                                               
 SB 122 - No previous Senate action.                                           
                                                                               
 SB 85 - See State Affairs minutes dated 3/7/95.                               
     See Judiciary minutes dated 3/17/95.                                      
                                                                               
 SJR 14 - See State Affairs minutes dated 2/21/95.                             
                                                                               
 HB 9 - See Judiciary minutes dated 3/20/95.                                   
                                                                               
  WITNESS REGISTER                                                             
                                                                               
 Joe Ambrose                                                                   
 Legislative Aide                                                              
 Alaska State Capitol                                                          
 Juneau, Alaska  99801-1182                                                    
  POSITION STATEMENT: Testified on CSSB 87 (CRA)                               
                                                                               
 Michael Ford                                                                  
 Legislative Legal Services                                                    
 Legislative Affairs Agency                                                    
 130 Seward St., Suite 409                                                     
 Juneau, AK  99801-2105                                                        
  POSITION STATEMENT:  Testified on CSSB 87 (CRA)                              
                                                                               
 Rick Urion                                                                    
 Alaska Wine & Spirits Wholesalers Assn.                                       
 P.O. Box 20868                                                                
 Juneau, Alaska  99802                                                         
  POSITION STATEMENT:  Supports CSSB 87 (CRA)                                  
                                                                               
 Patrick L. Sharrock                                                           
 Alaska Beverage Control Board                                                 
 550 W 7th Ave.                                                                
 Anchorage, AK  99501                                                          
  POSITION STATEMENT:  Answered questions on CSSB 87 (CRA)                     
                                                                               
 Sherman Ernouf                                                                
 Senate Labor & Commerce Committee Aide                                        
 Alaska State Capitol                                                          
 Juneau, Alaska  99801-1182                                                    
  POSITION STATEMENT:  Testified on SB 122                                     
                                                                               
 Pam Finley                                                                    
 Legislative Legal Services                                                    
 Legislative Affairs Agency                                                    
 130 Seward St. Suite 409                                                      
 Juneau, AK  99801-2109                                                        
  POSITION STATEMENT:  Testified on CSSB 85(JUD)                               
                                                                               
 Dwight Perkins                                                                
 Department of Labor                                                           
 P.O. Box 21149                                                                
 Juneau, AK  99802-1149                                                        
  POSITION STATEMENT: Supports CSSB 122(JUD)                                   
  Wilda Whittaker                                                              
 Legislative Aide                                                              
 Alaska State Capitol                                                          
 Juneau, Alaska  99801-1182                                                    
  POSITION STATEMENT:  Testified for sponsor of HB 9                           
                                                                               
 Senator Rick Halford                                                          
 Alaska State Legislature                                                      
 Juneau, Alaska  99801-1182                                                    
  POSITION STATEMENT:  Testified on SJR 14                                     
                                                                               
    ACTION NARRATIVE                                                           
                                                                               
 TAPE 95-14, SIDE A                                                            
 Number 001                                                                    
 SJUD - 3/22/95                                                                
                                                                               
       SB  87 ALCOHOLIC BEVERAGES: LOCAL OPTION & MISC.                       
                                                                              
  CHAIRMAN ROBIN TAYLOR  called the Judiciary Committee meeting to             
 order at 1:37 p.m.  The first order of business was CSSB 87(CRA).             
                                                                               
 JOE AMBROSE, legislative aide to Senator Taylor, gave the following           
 testimony.  Last year the Alcoholic Beverage Control Board (ABC               
 Board), prompted by concerns over a lack of clarity about how local           
 option elections are to be conducted, requested legislation to                
 simplify the process.  The ABC Board also asked the same vehicle be           
 used to address technical amendments to Title 4.  The result last             
 year was SB 372, which passed the Senate but died in the House                
 Rules Committee in the final days of the session.  SB 87 is                   
 essentially the same as last year's legislation.                              
                                                                               
 MR. AMBROSE continued.  CSSB 87(CRA) addresses the shortcomings in            
 current statute governing local option, for which no provision is             
 made for going from one type of option to another.  Under current             
 law, a community must first vote to remove all restrictions on the            
 sale and/or importation of alcoholic beverages, then conduct a                
 second election on new options.  This burdensome process can cause            
 confusion for municipalities and unincorporated villages.  The                
 Community and Regional Affairs committee substitute addresses                 
 specific concerns raised by local option communities.  Those                  
 amendments were supported by the ABC Board, and the chairman of the           
 sponsoring committee.                                                         
                                                                               
 MR. AMBROSE discussed proposed amendments to CSSB 87(CRA) that are            
 supported by the Division of Elections, liquor industry and chair             
 of the sponsoring committee.  CSSB 87 (CRA) is primarily a                    
 housekeeping measure to clarify existing law to make local option             
 a more understandable process.                                                
                                                                               
 MR. AMBROSE explained Amendment #1 to page 22, lines 26-29.  Line             
 27 should read, "under AS 04.11.491(a)(1) and the premises is a               
 nonprofit club, corporation, or association that was..." and line             
 29 should cite "AS 04.11.491(a)(1)."                                          
                                                                               
 Number 115                                                                    
                                                                               
 SENATOR GREEN asked if the nonprofit status would apply to                    
 corporations and associations.  MIKE FORD, Legislative Legal                  
 Services, clarified the word "nonprofit" refers to "club,"                    
 "corporation," and "association."  SENATOR ADAMS noted to prevent             
 future problems with interpretation, the word "nonprofit" should be           
 inserted before all three words to clarify the intent.                        
                                                                               
 SENATOR TAYLOR made a motion to amend Amendment #1 to insert the              
 word "nonprofit" in front of the words "club," "corporation," and             
 "association" and to move Amendment #1.  SENATOR ADAMS objected.              
                                                                               
 MIKE FORD suggested an additional change to Amendment #1.  He noted           
 the word "place" was used on line 27 because it also appears on               
 line 22.  He suggested replacing the word "place" on line 22 with             
 the word "premise" and changing line 27 to read, "premises are                
 occupied by a nonprofit club...."                                             
                                                                               
 SENATOR GREEN asked if line 24 needed to be amended to include the            
 word "nonprofit."  MR. FORD did not believe so.                               
                                                                               
 There being to objection to adopt Amendment #1, as amended, the               
 motion carried.                                                               
                                                                               
 Number 173                                                                    
                                                                               
 SENATOR GREEN moved the adoption of Amendment #2 which was labeled            
 "9-LS0673\F.1."  SENATOR ADAMS objected.                                      
                                                                               
 MR. AMBROSE addressed lines 19-22 on page 1 of Amendment #2 and               
 line 1 on page 2.  In revisions made to the Community and Regional            
 Affairs Committee substitute, the effective date of Section 70 of             
 the bill was inadvertently deleted.  Section 73 would reinstate the           
 immediate effective date.                                                     
                                                                               
 SENATOR ADAMS asked what Section 70 pertains to.  MIKE FORD stated            
 Section 70 allows the ABC Board to adopt regulations.                         
                                                                               
 RICK URION, Alaska Wine and Spirits Wholesale Association,                    
 explained the remainder of Amendment #2.  He stated the 21st                  
 amendment to the U.S. Constitution allows states to control the               
 importation of alcoholic beverages into their borders.  All but six           
 states have chosen to do so with a primary source law.  Amendment             
 register their suppliers and brands of liquor with the department,            
 along with a statement from the manufacturer of the product that              
 the wholesaler is the primary source.  This procedure would protect           
 the state and its revenue source by allowing products to be traced            
 and ensuring the payment of excise taxes by wholesalers.  It also             
 protects the state, wholesalers and the jobs created within the               
 industry.  This language would prevent gray market goods (products            
 manufactured in foreign countries intended for consumption or use             
 in a foreign country) from entering the state of Alaska.                      
                                                                               
 SENATOR ADAMS questioned how Amendment #2 would affect a typical              
 COSTCO member and how COSTCO distributes liquor from its warehouse.           
 MR. URION clarified retailers would not be affected at all, unless            
 they bought gray market goods.  The bill is directed to                       
 wholesalers.  He noted the industry will be self-policing.                    
                                                                               
 PATRICK SHARROCK, Director of the ABC Board, commented Amendment #2           
 does not address Senator Adams' question; Section 10 on page 5                
 does.  Section 10 restricts purchases of alcoholic beverages for              
 resale.                                                                       
                                                                               
 SENATOR ADAMS asked what the ABC Board's position is on Amendment             
 either amendment.  He added the intent of the measure is to                   
 solidify, in law, what has been implied or perceived for many                 
 years.                                                                        
                                                                               
 Number 265                                                                    
                                                                               
 SENATOR ELLIS asked Mr. Sharrock's personal opinion of the proposed           
 amendment.  MR. SHARROCK answered it solidifies a 3 tiered system             
 of the distribution of alcoholic beverages throughout the country,            
 which is probably beneficial.                                                 
                                                                               
 SENATOR ELLIS asked how the fees that would be established in                 
 statute compare to other states.  MR. URION replied CSSB 87(CRA)              
 differs from other state laws so it is difficult to compare.  He              
 developed the fee structure by determining the cost to the                    
 department to cover filing costs.  SENATOR ELLIS asked if other               
 states have a similar fee structure.  MR. URION explained other               
 states have fees but they are calculated in many different ways.              
 SENATOR ELLIS questioned whether the fees in Amendment #2 are                 
 comparable in any way.  MR. URION stated the industry believes the            
 fees to be reasonable.  SENATOR ELLIS requested, on behalf of the             
 committee, that Mr. Urion and the ABC Board provide the committee             
 with statistics on similar fees charged in other states.                      
                                                                               
 Number 300                                                                    
                                                                               
 SENATOR TAYLOR asked if the bill would generate new revenue.  MR.             
 URION replied affirmatively.                                                  
                                                                               
 SENATOR ADAMS asked for the ABC Board's position on Section 10,               
 specifically in regard to a COSTCO member.  MR. SHARROCK commented            
 it would prohibit a licensed retailer from purchasing alcohol at              
 that location for resale.                                                     
                                                                               
 SENATOR TAYLOR asked if liquor stores in the state were allowed to            
 sell products at wholesale cost.  MR. SHARROCK replied negatively,            
 and explained a wholesale licensee cannot have an interest in a               
 liquor store.  SENATOR TAYLOR commented COSTCO has a retail                   
 license, but a COSTCO member could buy a large quantity of liquor             
 at a discount price without paying sales tax.                                 
                                                                               
 MR.SHARROCK noted that could be perceived as a wholesale purchase             
 if the quantity was very large.  SENATOR TAYLOR commented if the              
 member bought the liquor for resale, he/she would be violating the            
 law.  MR. SHARROCK stated the problem lies in the fact that COSTCO            
 is not required to ask the customer whether the purchase is for               
 resale.  SENATOR TAYLOR stated a retailer is prohibited from                  
 selling at wholesale prices.  MR. SHARROCK added the sales tax has            
 already been paid in the form of an excise tax.                               
                                                                               
 SENATOR MILLER asked where COSTCO purchases the liquor.  MR. URION            
 replied from a licensed wholesaler which must be Alaska based.                
 SENATOR MILLER asked where the concern lies.  MR. URION explained             
 the bill does not change the way anything is currently done, and              
 that there is not a problem with gray market goods; the bill merely           
 closes up a loophole that exists.  He reiterated a retailer cannot            
 be a wholesaler, therefore the COSTCO situation is not a problem.             
                                                                               
 SENATOR MILLER questioned the need for additional restrictions.  He           
 compared the situation to other retail businesses who resell                  
 products purchased from retailers.  MR. URION clarified excise tax            
 must be paid on alcoholic beverages and is paid by wholesalers.  He           
 explained the excise tax is only paid once, and not by retailers              
 like COSTCO.                                                                  
                                                                               
 SENATOR TAYLOR noted the non-Alaskan distributor who ships liquor             
 into the state without paying the excise tax cannot be policed.               
 The retailer who purchases that liquor will do so at a much cheaper           
 price because the cost of the tax does not have to be taken into              
 consideration.                                                                
                                                                               
 Number 390                                                                    
                                                                               
 SENATOR ADAMS suggested the deletion of Section 10 on page 5.                 
                                                                               
 Number 400                                                                    
                                                                               
 SENATOR GREEN asked for clarification of how gray market goods                
 create market problems in other states.  MR. URION replied in the             
 contiguous states a wholesaler can transport goods from state to              
 state easily.  The problem is not as prevalent in Alaska, however             
 there have been times when gray market goods have been transported            
 into the state.  He discussed quality control problems with such              
 goods and the inability to remove those products from circulation             
 when they are unsafe.  SENATOR GREEN asked how CSSB 87(CRA) would             
 prevent those problems.  MR. URION explained it requires primary              
 source distributors to register the names of the producers of                 
 goods.                                                                        
                                                                               
 SENATOR TAYLOR commented the Washington State ABC Board determines            
 which brands can be sold in the state, and the liquor stores are              
 controlled by the state.                                                      
                                                                               
 SENATOR ADAMS questioned the fee structure in Amendment #2.  MR.              
 URION answered he determined the fee structure.  SENATOR TAYLOR               
 responded the committee had requested comparable fee calculations             
 from other states.                                                            
                                                                               
 SENATOR ELLIS commented he supports the effective date change in              
 Amendment #2 but preferred to wait for the fee structure                      
 information before taking action on that portion of the amendment.            
 MR. SHARROCK noted Mr. Urion calculated the fee amounts to cover              
 minimum administrative costs.                                                 
                                                                               
 SENATOR ELLIS stated he would like the fee comparisons to determine           
 whether the fees are justifiable recompensation to the state.  He             
 asked that the comparisons include the total administrative costs             
 to the ABC Board.                                                             
                                                                               
 SENATOR TAYLOR announced he would table Amendment #2.  There being            
 no objection, Amendment #2 was tabled.                                        
                                                                               
 The committee discussed Amendment #3 (9-LS0673\F.2).  SENATOR GREEN           
 moved the adoption of Amendment #3.   For purposes of discussion,             
 SENATOR ELLIS objected.                                                       
                                                                               
 MR. AMBROSE noted Amendment #3 was submitted at the request of the            
 Division of Elections.                                                        
                                                                               
 Number 478                                                                    
                                                                               
 MR. FORD discussed the intent of Amendment #3.  It clarifies that             
 local option language on a ballot contains a summary of the                   
 authority in question.  This would define what option is being                
 voted on.  SENATOR TAYLOR asked if it clarifies the election                  
 process.  MR. FORD responded it clarifies the ballot itself.                  
                                                                               
 SENATOR ELLIS removed his objection.  SENATOR ADAMS objected for              
 the purpose of discussion.  He asked what happens when there are              
 two competing petitions, one to impose a restriction, and the                 
 second to repeal that petition.  MR. FORD stated CSSB 87(CRA)                 
 specifies that the first petition filed that is certified as                  
 meeting statutory requirements takes precedence (page 21, lines 11-           
 14).  That petition must be voted on before a second petition can             
 be filed.                                                                     
                                                                               
 Number 515                                                                    
                                                                               
 SENATOR TAYLOR asked who the entity would be that determines                  
 certification.  MR. FORD replied it would depend; if the election             
 was municipal, it would be certified by the municipal clerk.                  
                                                                               
 SENATOR ADAMS questioned how a "dry" community would go "damp."  He           
 asked if a community would have to go from "dry" to "wet" before              
 going "damp."  MR. FORD explained it would be a one-step process.             
 SENATOR ADAMS asked how often a petition can be filed.  MR. FORD              
 noted page 21 (subsection f) contains language which addresses time           
 limitations.                                                                  
                                                                               
 SENATOR ADAMS removed his objection, but stated he will look at               
 subsection (f) on page 21 for possible amendment.  There being no             
 objection to the adoption of Amendment #3, the motion carried.                
                                                                               
 Number 532                                                                    
                                                                               
 SENATOR ADAMS announced he was given a list of proposed amendments            
 from the Department of Public Safety that he would present to the             
 committee on Monday.                                                          
 SJUD - 3/22/95                                                                
                                                                               
        SB 122 NO UNEMPLOYMENT COMP FOR DIRECT SELLERS                        
                                                                              
 SENATOR MILLER moved the adoption of CSSB 122(JUD) in lieu of the             
 original bill.  There being no objection, the Judiciary committee             
 substitute was adopted.                                                       
                                                                               
 SHERMAN ERNOUF, legislative aide to Senator Kelly, testified on SB            
 122, which was introduced by the Senate Labor and Commerce                    
 Committee at the request of several groups of direct sellers.  The            
 purpose of SB 122 is to direct exempt sellers of consumer products            
 from coverage under Alaska's unemployment compensation laws.  SB              
 122 would resolve a long standing issue of contention between the             
 Department of Labor and direct sellers.                                       
                                                                               
 MR. ERNOUF discussed the two criteria required for exemption:  the            
 direct seller must be physically present in a prospective                     
 customer's home to sell or solicit a consumer product; and the                
 direct seller must be compensated by sales, commissions, or by                
 profit represented by the difference between the wholesale cost of            
 the product and the final sale price.  The committee substitute               
 adds the word "remuneration" to cover other situations that                   
 develop.  He added wholesalers who sell merchandise are not forced            
 to pay unemployment compensation payments.  He concluded by saying            
 SB 122 is a narrowly tailored consensus approach to resolve a long            
 standing problem.                                                             
                                                                               
 Number 571                                                                    
                                                                               
 SENATOR ADAMS asked if CSSB 122 (JUD) would have any impact,                  
 negative or positive, on the unemployment insurance (UI) trust                
 fund.  MR. ERNOUF replied the bill would affect such a small number           
 of people, it would have no effect on the UI fund.                            
                                                                               
 DWIGHT PERKINS, representing the Department of Labor, stated the              
 department does not believe CSSB 122 (JUD) will have a negative               
 effective on the UI fund.  Very few individuals have filed claims             
 under this program.  SENATOR ADAMS asked if it would affect                   
 unemployment insurance coverage.  MR. PERKINS replied it would have           
 no effect.                                                                    
                                                                               
 SENATOR ADAMS moved, and asked unanimous consent, that CSSB 122               
 (JUD) be moved out of committee with individual recommendations.              
 There being no objection, the motion carried.                                 
 TAPE 95-14, SIDE B                                                            
 SJUD - 3/22/95                                                                
                                                                               
                   SB  85 1995 REVISOR BILL                                  
                                                                               
 SENATOR MILLER moved the adoption of CSSB 85 (JUD) (Finley,                   
 3/21/95) for discussion.  SENATOR ADAMS objected and asked if the             
 committee substitute removes Section 19.                                      
                                                                               
 PAMELA FINLEY, Legislative Legal Services, reviewed the changes               
 made to the Judiciary Committee substitute. The committee                     
 substitute does not contain Section 19 and includes the amendments            
 labeled F1, F2, and F3.  SENATOR ADAMS removed his objection.                 
                                                                               
 SENATOR MILLER moved CSSB 85(JUD) out of committee with individual            
 recommendations.  There being no objection, the motion carried.               
 SJUD - 3/22/95                                                                
                                                                               
              HB 9 DAMAGE TO PROPERTY BY MINORS                              
                                                                               
 SENATOR GREEN moved the adoption of SCSCSHB 9(JUD).  Both Senators            
 Ellis and Adams objected.                                                     
                                                                               
 WILDA WHITTAKER, legislative aide to Representative Therriault,               
 sponsor of HB 9, testified.  She explained changes made in the                
 Senate Judiciary Committee substitute.   The circumstances under              
 which an individual could qualify to recover costs of an infraction           
 committed by a minor is changed on line 22, page 2 through line 1,            
 page 3.                                                                       
                                                                               
 SENATOR TAYLOR asked if the only change from the original version             
 was to delete the parenthetical language from line 22 on page 2, to           
 page 3, line 1.  MS. WHITTAKER answered affirmatively.                        
                                                                               
 Number 554                                                                    
                                                                               
 SENATOR ELLIS questioned the rationale for the change.  SENATOR               
 TAYLOR explained subsection (A) on page 2 is a limitation upon the            
 ability to execute against the judgement debtor's permanent fund              
 dividend and provides exceptions.  It would allow a writ of                   
 execution be issued against the minor in a civil action to recover            
 damages and limits that amount to $10,000.  The deletion in the               
 Senate Judiciary Committee substitute removes certain hurdles                 
 requiring the establishment that the state of Alaska had acted to             
 declare the juvenile a delinquent, or that the juvenile was                   
 convicted of a criminal offense.                                              
                                                                               
 SENATOR ELLIS asked if the rationale is based on the fact that                
 obtaining the judgement is difficult to do.  SENATOR TAYLOR                   
 clarified there are significant exemptions provided by law that               
 exempt people from the enforcement of a writ of execution, i.e. the           
 Homestead exemption.  He noted an individual must earn $30,000 per            
 year before his/her salary can be executed upon.                              
                                                                               
 Number 526                                                                    
                                                                               
 SENATOR ELLIS asked if a judgement is made against a minor for                
 damages in civil court, a criminal judgement would not be required            
 to attach restitution.  SENATOR TAYLOR replied affirmatively.                 
                                                                               
 SENATOR GREEN questioned why the limit was placed at $10,000 and              
 what provisions would be made for damage over that amount.  MS.               
 WHITTAKER replied the $10,000 figure was determined to be the 1994            
 equivalent of the $2,000 limit in the statute updated in 1967.                
 SENATOR GREEN questioned whether restitution should cover actual              
 costs.                                                                        
                                                                               
 SENATOR ELLIS stated the measure regarding the emancipation of                
 minors that passed last year might provide an incentive for a                 
 parent to emancipate a minor if the restitution costs were                    
 increased, to avoid taking responsibility.  SENATOR GREEN felt the            
 amount to be arbitrary but not capricious.                                    
                                                                               
 SENATOR TAYLOR commented tort reform supporters would consider this           
 measure important because it caps liability.                                  
                                                                               
 SENATOR ADAMS questioned whether the language change on page 1,               
 line 11, would include foster parents as a liable party.  MS.                 
 WHITTAKER responded that foster parents would be exempt.  SENATOR             
 ADAMS asked who would pay for the damages.  Debate over whether the           
 state would be liable ensued.                                                 
                                                                               
 SENATOR ADAMS asked if a child broke a window in a neighbor's home            
 while playing ball, whether the child's permanent fund dividend               
 would be garnished to pay for the damages.  SENATOR TAYLOR noted              
 the act must be intentional or knowing.                                       
                                                                               
 Number 460                                                                    
                                                                               
 SENATOR ELLIS asked if SCSCSHB 9(JUD) contains an explicit                    
 exemption for foster parents or juveniles in state custody.  MS.              
 WHITTAKER replied Section B of the current statute exempts state              
 agencies or its agents from liability for the acts of unemancipated           
 minors in its custody.                                                        
                                                                               
 SENATOR GREEN moved SCSCSHB 9(JUD) out of committee with individual           
 recommendations.  SENATOR ADAMS objected.  The motion failed with             
 Senators Green and Taylor voting "Yea," and Senators Ellis and                
 Adams voting "Nay."                                                           
 Number 439                                                                    
 SJUD - 3/22/95                                                                
                                                                               
         SJR 14 CONFIRMATION OF MEMBERS OF PUBLIC CORP                        
                                                                              
 SENATOR RICK HALFORD, sponsor of SJR 14, gave the following                   
 testimony.  SJR 14 has been reviewed by the Senate Finance                    
 Committee but was returned to the Senate Judiciary Committee to               
 create specific language to achieve the intent.  Had the                      
 corporations that control close to $20 billion in state assets been           
 envisioned at the time of statehood, a constitutional mechanism               
 would have been devised to prevent confirmation overlap problems.             
 He stated the question is how specific should constitutional                  
 language be.  The language needs to clearly cover the public                  
 entities that control billions of dollars of state assets and                 
 provide the voters an opportunity to amend the constitution so that           
 a check and balance system with regard to the boards and                      
 commissions is established.                                                   
                                                                               
 SENATOR TAYLOR discussed the need to keep the language sufficiently           
 generic so as to encompass the public entities that currently exist           
 and will be created in the future, and avoid the problem of                   
 providing a specific list of names that will be intentionally                 
 avoided by administrations in the future.                                     
                                                                               
 Number 420                                                                    
                                                                               
 SENATOR HALFORD stated one possibility is to change the words                 
 "public corporation" to "entity" but it is not clear what agencies            
 would be considered "entities."   He suggested scheduling a work              
 session with the Legislative Legal Services Division to refine the            
 language.                                                                     
                                                                               
 SENATOR ADAMS agreed with Senator Halford's statement about which             
 agencies should be covered, and felt CFAB should be included, but             
 he did not believe the list should include the smaller                        
 corporations.  SENATOR HALFORD stated one consideration was to only           
 include corporations that manage more than $50 million in state               
 assets but that would not include CFAB.                                       
                                                                               
 SENATOR HALFORD noted in an early draft, the addition of another              
 section was considered, however he felt a constitutional amendment            
 needs to be short, easily understood and self explanatory to gain             
 voter approval.  The Administration raised the argument that                  
 defining the assets as state assets might increase state liability            
 for default by the entity that controls those assets.                         
                                                                               
 SENATOR TAYLOR suggested establishing a work session on record to             
 review the measure and develop new language.  SENATOR HALFORD                 
 suggested including Judge Stewart since he was a member of the                
 Constitutional Convention.                                                    
                                                                               
 SENATOR HALFORD expressed concern that the Legislature approves all           
 members of the Board of Barbers and Hairdressers, yet has nothing             
 to do with the Permanent Fund Corporation Board, which has been               
 replaced by the past two administrations.                                     
                                                                               
 SENATOR TAYLOR announced he planned to set up a work session on SJR           
 14 within the next 10 days.                                                   
                                                                               
 SENATOR GREEN asked if the intent of SJR 14 is to provide                     
 legislative confirmation of members of public corporations and does           
 not set up a kind of audit system.  SENATOR HALFORD responded SJR             
 14 allows for legislative confirmation.   He recommended the                  
 creation of overlapping terms, and the ability to discharge for               
 cause also be included in law.  Because the Constitution provides             
 for legislative confirmation of heads of principle departments or             
 regulatory or quasi-judicial agencies only, board members of                  
 agencies like the Alaska Railroad Corporation are not confirmed by            
 the Legislature.  He stated the boards of public corporations are             
 usually comprised of commissioners as well as public members,                 
 therefore the composition of the board changes significantly with             
 a change of administration.  He noted the Permanent Fund                      
 Corporation Board has only one member that was on the last Board,             
 although some members from the previous board were recently                   
 reappointed after being removed by the previous governor.                     
 SJUD - 3/22/95                                                                
                                                                               
               HB 9 DAMAGE TO PROPERTY BY MINORS                              
                                                                              
 SENATOR MILLER moved SCSCSHB 9(JUD) out of committee with                     
 individual recommendations.  There being objection a roll call vote           
 was taken.  The motion carried with Senators Miller, Green, and               
 Taylor voting "Yea," and Senator Ellis voting "Nay."                          
 SENATOR TAYLOR adjourned the meeting at 2:50 p.m.                             
                                                                               

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