Legislature(2017 - 2018)BELTZ 105 (TSBldg)

02/28/2018 01:30 PM JUDICIARY

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ SB 173 LIABILITY: PESTICIDES & UTILITY POLES TELECONFERENCED
Heard & Held
+ HB 43 NEW DRUGS FOR THE TERMINALLY ILL TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
              SENATE JUDICIARY STANDING COMMITTEE                                                                             
                       February 28, 2018                                                                                        
                           1:46 p.m.                                                                                            
                                                                                                                                
                                                                                                                              
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator John Coghill, Chair                                                                                                     
Senator Mia Costello                                                                                                            
Senator Pete Kelly                                                                                                              
Senator Bill Wielechowski                                                                                                       
Senator Click Bishop                                                                                                            
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
All members present                                                                                                             
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
SENATE BILL NO. 173                                                                                                             
"An Act  relating to the liability  of a person or  the state for                                                               
the  release  of  certain  pesticides  during  application  on  a                                                               
utility pole."                                                                                                                  
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 43(JUD)                                                                                 
"An Act  relating to  prescribing, dispensing,  and administering                                                               
an  investigational  drug,  biological   product,  or  device  by                                                               
physicians for  patients who are  terminally ill for  the purpose                                                               
of sustaining  the patient's life; providing  immunity related to                                                               
manufacturing, distributing, or  providing investigational drugs,                                                               
biological products, or devices;  and relating to licensed health                                                               
care facility requirements."                                                                                                    
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: SB 173                                                                                                                  
SHORT TITLE: LIABILITY: PESTICIDES & UTILITY POLES                                                                              
SPONSOR(s): SENATOR(s) MICCICHE                                                                                                 
                                                                                                                                
02/02/18       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/02/18       (S)       RES                                                                                                    
02/12/18       (S)       RES AT 3:30 PM BUTROVICH 205                                                                           
02/12/18       (S)       Heard & Held                                                                                           
02/12/18       (S)       MINUTE(RES)                                                                                            
02/14/18       (S)       RES AT 3:30 PM BUTROVICH 205                                                                           
02/14/18       (S)       Heard & Held                                                                                           
02/14/18       (S)       MINUTE(RES)                                                                                            
02/16/18       (S)       RES AT 3:30 PM BUTROVICH 205                                                                           
02/16/18       (S)       Moved CSSB 173(RES) Out of Committee                                                                   
02/16/18       (S)       MINUTE(RES)                                                                                            
02/19/18       (S)       RES RPT CS  2DP 3NR  NEW TITLE                                                                         
02/19/18       (S)       DP: GIESSEL, COGHILL                                                                                   
02/19/18       (S)       NR: BISHOP, VON IMHOF, MEYER                                                                           
02/19/18       (S)       JUD REFERRAL ADDED AFTER RES                                                                           
02/28/18       (S)       JUD AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
                                                                                                                                
BILL: HB  43                                                                                                                  
SHORT TITLE: NEW DRUGS FOR THE TERMINALLY ILL                                                                                   
SPONSOR(s): REPRESENTATIVE(s) GRENN                                                                                             
                                                                                                                                
01/18/17       (H)       PREFILE RELEASED 1/13/17                                                                               
01/18/17       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/18/17       (H)       HSS, JUD                                                                                               
02/28/17       (H)       HSS AT 3:00 PM CAPITOL 106                                                                             
02/28/17       (H)       Heard & Held                                                                                           
02/28/17       (H)       MINUTE(HSS)                                                                                            
03/02/17       (H)       HSS AT 3:00 PM CAPITOL 106                                                                             
03/02/17       (H)       Heard & Held                                                                                           
03/02/17       (H)       MINUTE(HSS)                                                                                            
03/07/17       (H)       HSS AT 3:00 PM CAPITOL 106                                                                             
03/07/17       (H)       Moved  HB 43 Out of Committee                                                                          
03/07/17       (H)       MINUTE(HSS)                                                                                            
03/08/17       (H)       HSS RPT 5DP 1NR 1AM                                                                                    
03/08/17       (H)       DP: JOHNSTON, TARR, EDGMON, SULLIVAN-                                                                  
                         LEONARD, SPOHNHOLZ                                                                                     
03/08/17       (H)       NR: KITO                                                                                               
03/08/17       (H)       AM: EASTMAN                                                                                            
03/29/17       (H)       JUD AT 1:00 PM GRUENBERG 120                                                                           
03/29/17       (H)       Heard & Held                                                                                           
03/29/17       (H)       MINUTE(JUD)                                                                                            
04/03/17       (H)       JUD AT 1:00 PM GRUENBERG 120                                                                           
04/03/17       (H)       Moved  CSHB 43(JUD) Out of Committee                                                                   
04/03/17       (H)       MINUTE(JUD)                                                                                            
04/05/17       (H)       JUD RPT CS(JUD) NT 5DP 1NR                                                                             
04/05/17       (H)       DP: EASTMAN, KOPP, FANSLER, LEDOUX,                                                                    
                         CLAMAN                                                                                                 
04/05/17       (H)       NR: REINBOLD                                                                                           
04/10/17       (H)       MOVED TO BOTTOM OF CALENDAR                                                                            
04/10/17       (H)       MOVED TO BOTTOM OF CALENDAR                                                                            
04/10/17       (H)       TRANSMITTED TO (S)                                                                                     
04/10/17       (H)       VERSION: CSHB 43(JUD)                                                                                  
04/11/17       (S)       READ THE FIRST TIME - REFERRALS                                                                        
04/11/17       (S)       HSS, JUD                                                                                               
01/24/18       (S)       HSS AT 1:30 PM BUTROVICH 205                                                                           
01/24/18       (S)       Heard & Held                                                                                           
01/24/18       (S)       MINUTE(HSS)                                                                                            
01/29/18       (S)       HSS AT 1:30 PM BUTROVICH 205                                                                           
01/29/18       (S)       Moved CSHB 43(JUD) Out of Committee                                                                    
01/29/18       (S)       MINUTE(HSS)                                                                                            
01/31/18       (S)       HSS RPT  3DP 1NR                                                                                       
01/31/18       (S)       DP: VON IMHOF, BEGICH, GIESSEL                                                                         
01/31/18       (S)       NR: MICCICHE                                                                                           
02/28/18       (S)       JUD AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
SENATOR PETER MICCICHE                                                                                                          
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Sponsor of SB 173.                                                                                        
                                                                                                                                
DAVID WILKINSON, Assistant Attorney General                                                                                     
Civil Division                                                                                                                  
Environmental Section                                                                                                           
Department of Law                                                                                                               
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Answered questions related to SB 173.                                                                     
                                                                                                                                
EMILY NAUMAN, Legislative Counsel                                                                                               
Legislative Legal Services                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Answered questions related to SB 173.                                                                     
                                                                                                                                
KRISTIN RYAN, Director                                                                                                          
Spill Prevention and Response                                                                                                   
Department of Environmental Conservation (DEC)                                                                                  
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Answered questions related to SB 173.                                                                     
                                                                                                                                
ERIC FJELSTAD, Attorney                                                                                                         
Perkins Coie LLP                                                                                                                
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Testified in support of SB 173 on behalf of                                                               
the Homer Electric Association.                                                                                                 
                                                                                                                                
MICHAEL ROVITO, Director of Member and Public Relations                                                                         
Alaska Power Association                                                                                                        
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Testified in support of the CS for SB 173.                                                                
                                                                                                                                
REPRESENTATIVE JASON GRENN                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Sponsor of HB 43                                                                                          
                                                                                                                                
BROOKE IVY, Staff                                                                                                               
Representative Jason Grenn                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Delivered a sectional  analysis for HB 43 and                                                             
answered related questions.                                                                                                     
                                                                                                                                
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
1:46:33 PM                                                                                                                    
CHAIR  JOHN   COGHILL  called   the  Senate   Judiciary  Standing                                                             
Committee meeting to  order at 1:46 p.m.  Present  at the call to                                                               
order  were  Senators  Costello, Wielechowski,  Kelly  and  Chair                                                               
Coghill. Senator Bishop arrived during the introduction.                                                                        
                                                                                                                                
          SB 173-LIABILITY: PESTICIDES & UTILITY POLES                                                                      
                                                                                                                                
1:47:14 PM                                                                                                                    
CHAIR COGHILL  announced the consideration  of SB 173.  He listed                                                               
the individuals available to answer questions.                                                                                  
                                                                                                                                
1:48:09 PM                                                                                                                    
SENATOR  MICCICHE,  Alaska  State  Legislature,  Juneau,  Alaska,                                                               
sponsor of  SB 173, said  he introduced the legislation  after an                                                               
employee  from   the  Kenai  National  Wildlife   Refuge  did  an                                                               
unscientific  sampling  and  found residue  of  pentachlorophenol                                                               
("penta")  around  a power  pole.  The  compound  is used  as  an                                                               
insecticide to extend the life  of these poles. Utility companies                                                               
worried that if they were  asked to completely remove all 250,000                                                               
utility poles  in the  state, their  potential exposure  would be                                                               
about  $7.5 billion.  He continued  the introduction  speaking to                                                               
the following sponsor statement:                                                                                                
                                                                                                                                
     The  bottom-line purpose  of my  choice to  bring SB173                                                                    
     forward  is the  financial protection  of nearly  every                                                                    
     Alaskan  ratepayer  who  depends   upon  a  utility  to                                                                    
     deliver   electricity  to   their  home,   business  or                                                                    
     facility.  SB173 conforms  Alaska  law  to federal  law                                                                    
     with  respect to  wood  poles  treated with  pesticides                                                                    
     registered  with the  Environmental Protection  Agency.                                                                    
     The legislation is drafted narrowly  to apply only to a                                                                    
     "wood  utility  pole  installed,  removed  or  used  by                                                                    
     public  utilities   in  connection  with   providing  a                                                                    
     utility service in the state."                                                                                             
                                                                                                                                
     In the  State of Alaska,  every wooden utility  pole is                                                                    
     factory-treated  with  a  preservative/pesticide  which                                                                    
     prolongs the service life of  the pole by protecting it                                                                    
     from  organisms that  compromise structural  integrity.                                                                    
     It  is logical  to assume  that soil  coming in  direct                                                                    
     contact  with  treated utility  poles  for  30 or  more                                                                    
     years would include traces of that preservative.                                                                           
                                                                                                                                
     The provisions  of AS  46.03.822(a) are  interpreted to                                                                    
     assume   public  utility   liability  and   indirectly,                                                                    
     Alaskan    ratepayers    for    remediating    residual                                                                    
     preservative when replacing  or removing treated wooden                                                                    
     utility  poles. This  liability  does  not exist  under                                                                    
     federal law  because the  companion federal  statute to                                                                    
     AS  46.03.822 contains  a specific  exemption for  "the                                                                    
     application  of a  pesticide  product registered  under                                                                    
     the  Federal  Insecticide, Fungicide,  and  Rodenticide                                                                    
     Act [7 U.S.C. 136 et seq.]."                                                                                               
                                                                                                                                
     SB  173  clarifies  and eliminates  the  assumption  of                                                                    
     liability and  remediation costs for trace  elements by                                                                    
     including   the  federal   exemption  within   Alaska's                                                                    
     statutes.                                                                                                                  
                                                                                                                                
SENATOR MICCICHE said the expectation is that the Department of                                                                 
Environmental Conservation (DEC) will provide best practice                                                                     
guidelines for use requirements and disposal of preservative-                                                                   
treated utility poles to control or eliminate future                                                                            
contamination when poles are retired.                                                                                           
                                                                                                                                
He  expressed  appreciation  that  the  committee  requested  the                                                               
additional  referral because  it's important  that the  liability                                                               
matches  that under  the  federal  code. There  is  no desire  to                                                               
account for liability beyond that point.                                                                                        
                                                                                                                                
1:51:13 PM                                                                                                                    
SENATOR WIELECHOWSKI  asked what  provision in FIFRA  exempts the                                                               
federal government from liability.                                                                                              
                                                                                                                                
SENATOR MICCICHE deferred the question  to DEC or the legislative                                                               
drafter, Emily Nauman.                                                                                                          
                                                                                                                                
1:52:23 PM                                                                                                                    
SENATOR COSTELLO  asked if  SB 173 takes  the same  approach that                                                               
other states facing this issue have taken.                                                                                      
                                                                                                                                
1:54:20 PM                                                                                                                    
DAVID  WILKINSON,  Assistant  Attorney General,  Civil  Division,                                                               
Environmental  Section,  Department  of Law,  Anchorage,  Alaska,                                                               
advised  that  the  exemption  under  federal  law  is  found  in                                                               
Comprehensive    Environmental   Response,    Compensation,   and                                                               
Liability Act (CERCLA) Section 107  (i) [42 U.S.C. 9607(i)]. That                                                               
exemption applies  to registered pesticides broadly,  not utility                                                               
poles  specifically. It  exempts the  application of  a pesticide                                                               
that  has   been  registered   under  the   Federal  Insecticide,                                                               
Fungicide,  and  Rodenticide  Act (FIFRA)  from  liability  under                                                               
CERCLA.  The provision  includes savings  language that  provides                                                               
that it does  not affect or modify other statutory  or common law                                                               
obligations.                                                                                                                    
                                                                                                                                
SENATOR  WIELECHOWSKI  read  the  first  sentence  of  42  U.S.C.                                                               
9607(i) into the record:                                                                                                        
                                                                                                                                
     (i) Application of a registered pesticide product                                                                        
     No person (including the United  States or any State or                                                                    
     Indian tribe)  may recover under the  authority of this                                                                    
     section  for any  response costs  or damages  resulting                                                                    
     from the application of  a pesticide product registered                                                                    
     under   the   Federal   Insecticide,   Fungicide,   and                                                                    
     Rodenticide  Act [7  U.S.C. 136  et seq.].  [Nothing in                                                                    
     this paragraph  shall affect or  modify in any  way the                                                                    
     obligations or liability of any  person under any other                                                                    
     provision  of State  or Federal  law, including  common                                                                    
     law,  for damages,  injury, or  loss  resulting from  a                                                                    
     release of  any hazardous  substance or for  removal or                                                                    
     remedial  action or  the costs  of removal  or remedial                                                                    
     action of such hazardous substance.]                                                                                       
                                                                                                                                
He said his staff found that  courts have interpreted that as the                                                               
actual application of  the pesticide on poles  or somewhere else.                                                               
He asked  Mr. Wilkinson  if he had  a different  understanding of                                                               
the courts' interpretation.                                                                                                     
                                                                                                                                
MR. WILKINSON said no. The focus  is on the application, which is                                                               
the intended  use of a  pesticide. The  way federal case  law has                                                               
played out is  if the pesticide is intended to  be sprayed on one                                                               
plant and  it drifts onto  a nearby  property, that drift  is not                                                               
the application of  the pesticide that is  shielded under CIRCLA.                                                               
Only the intended use of the pesticide is shielded.                                                                             
                                                                                                                                
SENATOR  WIELECHOWSKI  read  the  second sentence  of  42  U.S.C.                                                               
9607(i) into the record:                                                                                                        
                                                                                                                                
     Nothing  in this  paragraph shall  affect or  modify in                                                                    
     any  way the  obligations  or liability  of any  person                                                                    
     under  any other  provision of  State  or Federal  law,                                                                    
     including  common law,  for  damages,  injury, or  loss                                                                    
     resulting from a release of  any hazardous substance or                                                                    
     for removal or remedial action  or the costs of removal                                                                    
     or remedial action of such hazardous substance.                                                                            
                                                                                                                                
He said his  understanding is that the federal  law only provides                                                               
an exemption for the actual  application of the pesticide, but it                                                               
doesn't shield  the product from  any laws states or  the federal                                                               
government have adopted in that regard.  He asked if it's fair to                                                               
say that Alaska is not out of compliance.                                                                                       
                                                                                                                                
MR. WILKINSON said he agreed with that reading of the provision.                                                                
                                                                                                                                
CHAIR COGHILL said the bill is  before the committee to make that                                                               
determination.                                                                                                                  
                                                                                                                                
SENATOR COSTELLO asked  Ms. Nauman if this  legislation was based                                                               
on model law.                                                                                                                   
                                                                                                                                
1:59:27 PM                                                                                                                    
EMILY  NAUMAN, Legislative  Counsel, Legislative  Legal Services,                                                               
Alaska State Legislature, Juneau, Alaska,  said she was not aware                                                               
of that, but she would look into it.                                                                                            
                                                                                                                                
CHAIR COGHILL requested she send  her response to both his office                                                               
and the sponsor's.                                                                                                              
                                                                                                                                
SENATOR  WIELECHOWSKI read  AS 09.65.085(a)  and  opined that  it                                                               
gives utility  companies the liability exemption  they're looking                                                               
for.  He  asked  if  she   or  Mr.  Wilkinson  have  a  different                                                               
interpretation.                                                                                                                 
                                                                                                                                
MR.  WILKINSON  said he  would  need  to do  additional  research                                                               
before he answered.                                                                                                             
                                                                                                                                
2:01:49 PM                                                                                                                    
SENATOR MICCICHE  clarified that application is  not spraying the                                                               
pesticide.  "The  application is  the  use  of the  pesticide  so                                                               
there's  a little  misunderstanding there."  He restated  that he                                                               
introduced SB 173 because he doesn't  want there to be a need for                                                               
a cleanup of the 250,000 poles  in the state if they have residue                                                               
of penta around the poles for  a reasonable distance. There is no                                                               
intent to entirely  absolve liability. The intent is  to find the                                                               
right mix  of liability  that protects  the normal,  intended use                                                               
and application of penta.                                                                                                       
                                                                                                                                
CHAIR COGHILL asked Senator Wielechowski  to restate his question                                                               
for Ms. Nauman.                                                                                                                 
                                                                                                                                
SENATOR WIELECHOWSKI  said he doesn't believe  that current state                                                               
law is at  odds with the federal law 42  U.S.C. 4607(i) regarding                                                               
the  application of  registered pesticides.  The exemption  under                                                               
CERCLA  applies  to  the  application   of  pesticides  that  are                                                               
registered under FIFRA. The second  sentence of 42 U.S.C. 4607(i)                                                               
specifically gives  states and the  federal government  the right                                                               
to enact whatever laws they wish on this topic.                                                                                 
                                                                                                                                
2:04:51 PM                                                                                                                    
MS. NAUMAN  said she  would need to  examine CERCLA  more closely                                                               
before giving a response.                                                                                                       
                                                                                                                                
CHAIR COGHILL  asked what remedy  would be available if  the bill                                                               
passes  and  people  had  trouble with  penta  residue  on  their                                                               
property.                                                                                                                       
                                                                                                                                
2:05:46 PM                                                                                                                    
MR.  WILKINSON   said  other  remedies  are   likely  to  survive                                                               
exemption to  AS 46.03.822 with  two caveats, but it  isn't clear                                                               
how an exemption  to .822 would alter those  common law remedies.                                                               
Also,  common law  remedies  are not  direct  substitutes for  AS                                                               
46.03.822.  Some federal  district courts  have held  that CERCLA                                                               
preempts federal  common law causes  of action that  are subsumed                                                               
under the structure of CERCLA.  However, in the pesticide context                                                               
the FIFRA exemption in CERCLA  section 107(i) expressly preserves                                                               
those other statutory rights in common law, causative action.                                                                   
                                                                                                                                
He said  he hasn't found  similar case  law in Alaska  looking at                                                               
the  impact of  .822 on  common  law claims.  The Alaska  Supreme                                                               
Court  has  analyzed  common  law  causes  of  action,  which  is                                                               
negligence,  nuisance,  and  trespass alongside  .822  causes  of                                                               
action but hasn't squarely addressed  whether .822 preempts those                                                               
common  law claims.  There  is  a question  there  and about  the                                                               
interplay  between  a  statute  and  common  law  in  these  more                                                               
traditional claims.                                                                                                             
                                                                                                                                
One  example of  this  interplay is  in  the negligence  context.                                                               
Negligence cause  of action, which  would arguably survive  for a                                                               
landowner, requires  duty, breach  of duty, causation,  and harm.                                                               
But when  courts look to  find a duty,  they look to  statutes so                                                               
there's  a question  raised by  an exemption  to .822.  Does that                                                               
alter  the duty  that a  utility company  might owe  a landowner?                                                               
They're   exempt  from   liability  for   release  of   hazardous                                                               
substances under  a statute. Whether  that changes the  duty that                                                               
they have to landowners is potentially a litigation question.                                                                   
                                                                                                                                
CHAIR COGHILL  commented that  the clearer we  can speak  in this                                                               
statute, the better for common law remedies.                                                                                    
                                                                                                                                
MR. WILKINSON  agreed that  clarity in  the statute  would lessen                                                               
the argument that an exemption changes the common law somehow.                                                                  
                                                                                                                                
CHAIR COGHILL  asked Ms. Ryan  who a private individual  would go                                                               
to if  they found pollution  on their property  that contaminated                                                               
their well.                                                                                                                     
                                                                                                                                
2:10:23 PM                                                                                                                    
KRISTIN   RYAN,   Director,   Spill  Prevention   and   Response,                                                               
Department  of   Environmental  Conservation   (DEC),  Anchorage,                                                               
Alaska,  said  Mr.  Wilkinson  expressed   that  there  are  some                                                               
unknowns  as to  how a  court would  interpret liability  in that                                                               
scenario. DEC  would eliminate the exposure  pathway by providing                                                               
a drinking water  source if the chemicals  were carcinogenic when                                                               
consumed but deciding who would pay  for that or who would remedy                                                               
the  problem  is a  little  murky.  Based  on the  language,  she                                                               
guessed that  the utility  company would not  be liable,  and the                                                               
homeowner  probably would  not be  liable. It  is clear  that the                                                               
state  would  be obliged  to  use  its  resources to  remedy  the                                                               
problem.                                                                                                                        
                                                                                                                                
CHAIR COGHILL asked if there has ever been a problem in Alaska.                                                                 
                                                                                                                                
MS. RYAN said not that she was aware of.                                                                                        
                                                                                                                                
CHAIR  COGHILL asked  if she  had  experience with  any of  these                                                               
common law remedies.                                                                                                            
                                                                                                                                
MS.  RYAN said  joint  and several  liability  statutes are  very                                                               
clear  that all  the  parties that  spilled  the contaminant  are                                                               
responsible,  as  well  as  the  land  owner  who  inherited  the                                                               
contaminated   property.  She   was  not   aware  of   any  broad                                                               
exemptions; this would be the first.                                                                                            
                                                                                                                                
CHAIR  COGHILL  asked  if   contamination  of  groundwater  [from                                                               
residue around a power pole] was likely or highly speculative.                                                                  
                                                                                                                                
MS.  RYAN said  contamination of  a private  drinking water  well                                                               
from utility  pole residue  has not occurred  in Alaska,  but she                                                               
was aware of it happening in  one other state. The chance of this                                                               
occurring is remote,  but the question is what would  occur if it                                                               
did  happen.  DEC  is  working  with  industry  to  develop  best                                                               
management practices to minimize  any migration of chemicals from                                                               
the utility  poles into an  aquifer. DEC's focus has  always been                                                               
to be  proactive instead  of dealing with  the problem  after the                                                               
fact.                                                                                                                           
                                                                                                                                
2:16:26 PM                                                                                                                    
CHAIR COGHILL  asked if DEC  defines minimal standards  for other                                                               
contaminants instead of a blanket exemption.                                                                                    
                                                                                                                                
MS. RYAN said she was unaware  of any exemptions in the liability                                                               
statutes, but  the department believes  that a minimal  amount of                                                               
leaching around  a utility pole is  to be expected and  would not                                                               
be a  large concern. She suggested  that if that was  the utility                                                               
companies'  concern,   it  should   be  clearly  stated   in  the                                                               
legislation.  That would  provide the  companies some  relief and                                                               
wouldn't tie  the department's hands  to deal with  a significant                                                               
contamination event.                                                                                                            
                                                                                                                                
2:18:03 PM                                                                                                                    
SENATOR WIELECHOWSKI  summarized that  the bill exempts  both the                                                               
utility company  and the  homeowner from  liability. He  asked if                                                               
she interprets the  language in Section 1  regarding liability of                                                               
persons to include the state.                                                                                                   
                                                                                                                                
MS.  RYAN agreed  with the  summary  and that  the Department  of                                                               
Labor   and  Workforce   Development  (DOLWD)   would  meet   the                                                               
definition in  Section 1.  She added  that even  though liability                                                               
would not  fall to DOT, DEC  would need to utilize  some funds to                                                               
eliminate  the  exposure  pathway  so  that  human  health  isn't                                                               
impacted.                                                                                                                       
                                                                                                                                
SENATOR  WIELECHOWSKI said  he didn't  want utility  companies to                                                               
replace 250,000 poles  but somebody must be  responsible if there                                                               
is  significant contamination.  He asked  her to  think about  an                                                               
amendment  he  was  working  on   that  adds  a  paragraph  under                                                               
subsection  (b) in  Section 1.  It basically  says, "there  is no                                                               
liability  as long  as  the release  does  not contaminate  soil,                                                               
surface  water  or  ground  water beyond  the  radius  depth  and                                                               
concentration  specified  by   the  Department  of  Environmental                                                               
Conservation." The  amendment goes on to  determine by regulation                                                               
what  radius depth  and concentration  would potentially  lead to                                                               
the harm of public safety or welfare.                                                                                           
                                                                                                                                
CHAIR COGHILL  asked if  contamination is  measured in  parts per                                                               
million or  if each pesticide  is considered based on  the latest                                                               
health bulletin.                                                                                                                
                                                                                                                                
MS.  RYAN  replied  DEC  relies  on  the  numbers  in  regulation                                                               
regarding  what  is  safe  for  dioxins  in  different  receiving                                                               
environments and  human health. She  also pointed out  that while                                                               
penta is  approved for use on  utility poles, it is  not the main                                                               
chemical  of concern  for  leaching.  It is  dioxin,  which is  a                                                               
byproduct of  the manufacturing process.  The EPA talks  at great                                                               
length about  that in the  record of decisions approving  its use                                                               
in these situations.                                                                                                            
                                                                                                                                
CHAIR  COGHILL   asked  if  she   had  any  comment   on  Senator                                                               
Wielechowski's proposed amendment.                                                                                              
                                                                                                                                
MS. RYAN  replied the department  has been considering  a similar                                                               
improvement  to  the  legislation.  Setting a  minimal  level  of                                                               
contamination as  acceptable would  require the department  to be                                                               
very  specific  in its  regulations,  but  before they  could  be                                                               
drafted  more  information  is needed  to  understand  where  the                                                               
chemicals are migrating and how far.                                                                                            
                                                                                                                                
2:23:57 PM                                                                                                                    
SENATOR WIELECHOWSKI  asked if a  homeowner would be  required to                                                               
disclose when they sold their  property that utility poles in the                                                               
right-of-way  on  their  property  were  leaching  pesticides  or                                                               
dioxins.                                                                                                                        
                                                                                                                                
MS.  RYAN said  a homeowner  would be  required to  disclose that                                                               
information if they  were aware of it, but she  would assume most                                                               
homeowners would not have that information.                                                                                     
                                                                                                                                
CHAIR COGHILL  said he'd like  to hear from utility  companies at                                                               
this point.                                                                                                                     
                                                                                                                                
2:25:41 PM                                                                                                                    
ERIC  FJELSTAD, Attorney,  Perkins Coie  LLP, Anchorage,  Alaska,                                                               
said he  was testifying  in support  of SB 173  on behalf  of the                                                               
Homer Electric  Association. He said  he would offer  the utility                                                               
company's  perspective  on  the  issues  that  have  been  raised                                                               
focusing on  the state  liability scheme  under AS  46.03.822 and                                                               
comparing  it   to  the  federal   liability  scheme   under  the                                                               
Comprehensive    Environmental   Response,    Compensation,   and                                                               
Liability  Act   (CERCLA).  He  said   he  agrees   with  Senator                                                               
Wielechowski that  this isn't a  question of the state  being out                                                               
of compliance  with federal law.  The question is what  the state                                                               
should do as a matter of policy because it does have latitude.                                                                  
                                                                                                                                
Section  107 (i)  of CERCLA  says that  if a  pesticide has  been                                                               
registered and  approved by  EPA, then CERCLA  cannot be  used to                                                               
require an  investigation and cleanup of  that pesticide. Similar                                                               
provisions in  CERCLA apply to  other situations such  as federal                                                               
air  or   water  permits  and  consumer   product  exception  for                                                               
asbestos. The  policy issue is  that while these products  may be                                                               
harmful,  when they  are used  properly  Congress through  CERCLA                                                               
should  not create  a liability  scheme where  something is  used                                                               
pursuant to its  intended use. AS 46.03.822 is  modeled on CERCLA                                                               
and  proposes  to  include  pesticides  in  the  state  liability                                                               
scheme.                                                                                                                         
                                                                                                                                
MR. FJELSTAD said  he was highly confident  that these pesticides                                                               
would  fall  within  the  exemption   under  CERCLA  because  the                                                               
exemption in federal  law is being actively  regulated by another                                                               
federal scheme. It's  not just Congress making  an exemption that                                                               
some  particular person  or industry  shouldn't  be liable.  This                                                               
goes to Senator Coghill's question  about whether this has been a                                                               
problem  in  the past.  It  hasn't  been  a problem  because  the                                                               
Federal Insecticide,  Fungicide, and  Rodenticide Act  (FIFRA) is                                                               
actively  regulating  how  these  materials  can  be  applied  in                                                               
practice.                                                                                                                       
                                                                                                                                
He  explained that  the utility  companies are  concerned because                                                               
the  question about  pesticide  leaching was  raised  in the  one                                                               
instance and  there is  an affirmative  obligation for  any party                                                               
that is aware  of a release to  report it to DEC  and that starts                                                               
the cleanup process. There are  hundreds of thousands of poles in                                                               
the state and the question  is whether the utility companies must                                                               
go out and prove a negative,  that there is nothing there or that                                                               
it's de minimis.                                                                                                                
                                                                                                                                
2:31:01 PM                                                                                                                    
CHAIR COGHILL asked if the  general liability in existing statute                                                               
would apply in this situation.                                                                                                  
                                                                                                                                
MR. FJELSTAD  said he would like  to say it applies  but he would                                                               
be  nervous doing  so given  that the  courts generally  construe                                                               
exceptions to liability narrowly.                                                                                               
                                                                                                                                
SENATOR WIELECHOWSKI  asked what  liabilities would  be available                                                               
to homeowners  or affected individuals  if the bill were  to pass                                                               
as currently drafted.                                                                                                           
                                                                                                                                
MR. WILKINSON said  common law exceptions are  likely to survive,                                                               
but  the Alaska  Supreme  Court has  not  directly addressed  the                                                               
question of  whether AS 46.03.822  has an impact on  the survival                                                               
of common law  claims. Chapter 46.03 does have  the regulation of                                                               
hazardous  substances  including  the  prohibition  of  releasing                                                               
hazardous  substances  without  a   permit  and  prohibitions  on                                                               
pollution.                                                                                                                      
                                                                                                                                
SENATOR  COSTELLO asked  if there  is higher  liability regarding                                                               
utility easements near school grounds.                                                                                          
                                                                                                                                
MR.  WILKINSON said  AS 46.03.822  doesn't  change the  liability                                                               
based on the vulnerability of people who might be injured.                                                                      
                                                                                                                                
CHAIR COGHILL  commented that it's  an interesting  question when                                                               
school yards are often paved with asphalt.                                                                                      
                                                                                                                                
2:37:55 PM                                                                                                                    
MICHAEL ROVITO,  Director of Member and  Public Relations, Alaska                                                               
Power Association,  Anchorage, Alaska, stated support  for the CS                                                               
for SB 173. He said  large and small utility companies throughout                                                               
Alaska utilize  the pesticide  pentachlorophenol on  the hundreds                                                               
of thousands of utility poles  they own throughout the state. Use                                                               
of  this pesticide  is regulated  under the  Federal Insecticide,                                                               
Fungicide,  and  Rodenticide  Act  (FIFRA).  In  2008,  the  U.S.                                                               
Environmental Protection Agency  reregistered penta after issuing                                                               
a  report  that  found  the  benefits  of  penta  outweighed  any                                                               
remaining  risks. The  FIFRA regulations  ensure  that using  the                                                               
pesticide according to specification  will not cause unreasonable                                                               
adverse  effects on  the  environment. SB  173  ensures that  the                                                               
pesticide  on utility  poles is  properly regulated  as pesticide                                                               
use and not  spills. This is an important  distinction missing in                                                               
Alaska  law. The  bill also  provides that  the use  of penta  on                                                               
utility poles will be regulated  under Alaska's pesticide control                                                               
program  under FIFRA  instead of  under DEC's  Division of  Spill                                                               
Prevention and Response.                                                                                                        
                                                                                                                                
2:40:40 PM                                                                                                                    
CHAIR COGHILL  said he intended  to look into  Alaska's pesticide                                                               
control program under FIFRA.                                                                                                    
                                                                                                                                
2:41:45 PM                                                                                                                    
SENATOR MICCICHE said  his office has worked  with DEC throughout                                                               
this  process to  find the  right balance  on liability.  This is                                                               
about protection of Alaska ratepayers.                                                                                          
                                                                                                                                
SENATOR BISHOP said  he doubts there would be a  spill from these                                                               
poles, but there could be an inadvertent release.                                                                               
                                                                                                                                
SENATOR MICCICHE said  there have only been two  incidents in the                                                               
history of  the use of  penta and he  assumes that the  penta was                                                               
improperly applied during manufacture.                                                                                          
                                                                                                                                
CHAIR COGHILL  commented that  even that  would be  identified as                                                               
leaching, not a spill.                                                                                                          
                                                                                                                                
SENATOR  BISHOP added  that Kristen  Ryan has  a calculation  for                                                               
what is a reportable spill and what is not.                                                                                     
                                                                                                                                
SENATOR  MICCICHE reiterated  that  he wanted  to  get the  right                                                               
balance.                                                                                                                        
                                                                                                                                
2:45:21 PM                                                                                                                    
CHAIR COGHILL held SB 173 in committee.                                                                                         
                                                                                                                                
            HB  43-NEW DRUGS FOR THE TERMINALLY ILL                                                                         
                                                                                                                                
2:45:36 PM                                                                                                                    
CHAIR COGHILL announced the consideration of HB 43.                                                                             
                                                                                                                                
2:46:15 PM                                                                                                                    
REPRESENTATIVE  JASON  GRENN,  Alaska State  Legislature  Juneau,                                                               
Alaska, sponsor of HB 43,  introduced the legislation speaking to                                                               
the following sponsor statement:                                                                                                
                                                                                                                                
     House Bill  43 would allow terminally  ill patients who                                                                    
     have exhausted  other available  treatments and  do not                                                                    
     qualify for  clinical trials to  gain faster  access to                                                                    
     safe,  but  experimental drugs  in  an  effort to  save                                                                    
     their  own lives.  By providing  certain immunities  to                                                                    
     prescribing physicians,  manufacturers and distributors                                                                    
     acting in  good faith,  this bill would  allow terminal                                                                    
     patients,  in  consultation   with  their  doctor,  the                                                                    
     freedom  to  try  new  treatments   as  they  fight  to                                                                    
     survive,  without the  burden  of  waiting for  federal                                                                    
     approval.                                                                                                                  
                                                                                                                                
     More  than  1 million  Americans  die  from a  terminal                                                                    
     illness every  year. Many spend  years searching  for a                                                                    
     potential  cure, or  struggle in  vain to  get accepted                                                                    
     into a clinical trial.  Unfortunately, FDA red tape and                                                                    
     government  regulations can  often  restrict access  to                                                                    
     promising new  treatments, and sometimes for  those who                                                                    
     do get access, it is too late.                                                                                             
                                                                                                                                
     The   United  States   Food  and   Drug  Administration                                                                    
     currently    offers    an    "expanded    access"    or                                                                    
     "compassionate  use" exemption  that allows  terminally                                                                    
     ill  patients  that  meet certain  criteria  to  access                                                                    
     drugs in  the clinical trial phase.  However, even with                                                                    
     recent   efforts  by   the   FDA   to  streamline   the                                                                    
     application  process, this  exemption program  is known                                                                    
     to be arduous and can  take longer than patients facing                                                                    
     terminal illness have to wait.                                                                                             
                                                                                                                                
     Since  2014,  38  states have  signed  "right  to  try"                                                                    
     legislation into law  with strong, bi-partisan support.                                                                    
     It  is clear  this is  a human  issue that  goes beyond                                                                    
     state  and  party  lines, and  could  provide  Alaskans                                                                    
     increased access to  potentially life-saving treatments                                                                    
     in the times they need it most.                                                                                            
                                                                                                                                
     In  allowing  Alaskans   facing  terminal  illness  the                                                                    
     ability to  access safe,  though experimental  drugs in                                                                    
     consultation  with  a  doctor  they  trust,  this  bill                                                                    
     offers  new hope  when  all  FDA-approved options  have                                                                    
     been exhausted. I urge your support of House Bill 43.                                                                      
                                                                                                                                
REPRESENTATIVE GRENN read a letter of support from a                                                                            
constituent.                                                                                                                    
                                                                                                                                
     I  write to  you today  in support  of HB  43 with  the                                                                    
     short  title, "New  Drugs for  the Terminally  Ill." In                                                                    
     June 2011, my father  was diagnosed with ALS, sometimes                                                                    
     known as  Lou Gehrig's  disease. For  those unfamiliar,                                                                    
     this disease  slowly saps a  person's ability  to move,                                                                    
     rendering  them bed-ridden.  Eventually  it takes  away                                                                    
     their ability to  breathe at which point  they die. For                                                                    
     my father, this deterioration began in June.                                                                               
                                                                                                                                
     He had been  working 12 hours days, five or  six days a                                                                    
     week as  a machinist. He  was, by all accounts,  a very                                                                    
     strong and health man at  the time of his diagnosis. By                                                                    
     late fall he  had completely lost his  ability to walk.                                                                    
     At  Thanksgiving, he  held out  five-month-old son  for                                                                    
     the last time  in his arms as he had  become to weak to                                                                    
     be trusted  with such precious cargo.  In early morning                                                                    
     of February 1,  2012, he died at the all  too young age                                                                    
     of 58.                                                                                                                     
                                                                                                                                
     In the end I wish the  State had afforded him the right                                                                    
     to fight  his disease. Recently in  the Washington Post                                                                    
     there was an article detailing  the experience of a man                                                                    
     who  had,  for all  intents  and  purposes, beaten  ALS                                                                    
     through advance  therapies pioneered by doctors  at the                                                                    
     ALS Center  in Atlanta, Georgia. In  reading about this                                                                    
     man, I  became aware  of the Right  to Try  movement. I                                                                    
     cannot say  for sure  that these advance  therapies may                                                                    
     have  saved my  father's life,  but they  may yet  same                                                                    
     someone's father, mother, daughter, or son.                                                                                
                                                                                                                                
     Thank  you for  your  consideration  on this  important                                                                    
     legislation.                                                                                                               
                                                                                                                                
REPRESENTATIVE GRENN stated that the goal  of HB 43 is to provide                                                               
the same access as the FDA's  Compassionate Use Program, but on a                                                               
shorter  timeline. That  program  recognizes that  97 percent  of                                                               
people are not accepted in clinical  trials. HB 43 seeks to offer                                                               
new  hope  when   all  other  FDA  approved   options  have  been                                                               
exhausted.                                                                                                                      
                                                                                                                                
2:50:15 PM                                                                                                                    
BROOKE  IVY,  Staff,  Representative Jason  Grenn,  Alaska  State                                                               
Legislature Juneau,  Alaska, paraphrased the  following sectional                                                               
analysis for HB 43:                                                                                                             
                                                                                                                                
     Section 1: Prohibits  disciplinary action of physicians                                                                    
     by the State Medical  Board for prescribing, dispensing                                                                    
     or  administering an  investigational drug,  biological                                                                    
     product or  device to terminally ill  patients that are                                                                    
     ineligible  or  unable  to  participate  in  a  current                                                                    
     clinical  trial, have  considered  all other  treatment                                                                    
     options approved  by the FDA and  have provided written                                                                    
     consent.                                                                                                                   
                                                                                                                                
     Defines  "investigational  drugs,  biological  products                                                                    
     and devices" as those  that have successfully completed                                                                    
     Phase 1  of the FDA  drug review process and  remain in                                                                    
     ongoing Phase 2  or 3 clinical trials  or the marketing                                                                    
     application  process but  have  not  been approved  for                                                                    
     general use.                                                                                                               
                                                                                                                                
     Defines  "terminal  illness"  as a  disease  that  will                                                                    
     result in death  in the near future  or permanent state                                                                    
     of unconsciousness from which recovery is unlikely.                                                                        
                                                                                                                                
     Section   2:  Establishes   immunity  for   physicians,                                                                    
     medical  team members,  manufacturers and  distributors                                                                    
     in  the case  of injury  or death  of a  terminally ill                                                                    
     patient  from  the  use  of  an  investigational  drug,                                                                    
     biological   product  or   device,  provided   informed                                                                    
     consent  was obtained  from the  patient and  notice of                                                                    
     immunity was given in advance.                                                                                             
                                                                                                                                
     Establishes immunity  for physicians  and manufacturers                                                                    
     who choose  not to  participate in the  distribution of                                                                    
     an investigational drug, biological product or device.                                                                     
                                                                                                                                
     Section  3:  Amends  statute   limiting  the  sale  and                                                                    
     distribution of new  drugs (AS 17.20.110) so  as not to                                                                    
     apply  to   physicians  prescribing   or  administering                                                                    
     investigational drugs under  the conditions established                                                                    
     in Section 1.                                                                                                              
                                                                                                                                
     Section  4:  Prohibits  the Department  of  Health  and                                                                    
     Social Services  from requiring a licensed  health care                                                                    
     facility   to   increase   its   services   solely   to                                                                    
     accommodate   physicians  prescribing,   dispensing  or                                                                    
     administering investigational drugs to a patient.                                                                          
                                                                                                                                
CHAIR COGHILL  asked if 97  percent of Alaskans have  been denied                                                               
clinical trials.                                                                                                                
                                                                                                                                
MS.  IVY  replied  that  is  a national  number.  She  noted  the                                                               
clinical trials  document in the  packet has stories  of Alaskans                                                               
who have been admitted into clinical trials.                                                                                    
                                                                                                                                
CHAIR COGHILL asked her to discuss the FDA drug review process.                                                                 
                                                                                                                                
MS.  IVY explained  that when  a drug  manufacturer's application                                                               
for  an investigational  new  drug (IND)  is  accepted, the  drug                                                               
moves  into  phase 1.  The  drug  is  studied for  possible  side                                                               
effects and toxicity levels on  healthy volunteers. Phase 2 looks                                                               
at how effective the drug is for the condition. Phase 3 looks at                                                                
safety again as well as effectiveness.                                                                                          
                                                                                                                                
CHAIR COGHILL asked if the informed consent form tells an                                                                       
individual they are part of a trial.                                                                                            
                                                                                                                                
2:55:22 PM                                                                                                                    
MS. IVY clarified that the volunteer would not be in a clinical                                                                 
trial, but the data related to the experimental drug would be                                                                   
collected and sent to the FDA.                                                                                                  
                                                                                                                                
2:57:32 PM                                                                                                                    
CHAIR COGHILL held HB 43 in committee.                                                                                          
                                                                                                                                
2:57:46 PM                                                                                                                    
There being no further business to come before the committee,                                                                   
Chair Coghill adjourned the Senate Judiciary Standing Committee                                                                 
meeting at 2:57 p.m.                                                                                                            

Document Name Date/Time Subjects
SB 173 - Sponsor Statement.pdf SJUD 2/28/2018 1:30:00 PM
SB 173
SB 173 - Explanation of Changes (ver. A to ver. J).PDF SJUD 2/28/2018 1:30:00 PM
SB 173
SB 173 - Letters of Support.pdf SJUD 2/28/2018 1:30:00 PM
SB 173
SB 173 - Sectional Summary (ver. J).PDF SJUD 2/28/2018 1:30:00 PM
SB 173
HB 43 - Supporting Document - FDA Drug Review Process.pdf SJUD 2/28/2018 1:30:00 PM
HB 43
HB 43 - Supporting Document - Clinical Trials in Alaska.pdf SJUD 2/28/2018 1:30:00 PM
HB 43
HB 43 - Supporting Document - Goldwater Institute Fact Sheet.pdf SJUD 2/28/2018 1:30:00 PM
HB 43
HB 43 - Supporting Document - Goldwater Institute Patient Stories.pdf SJUD 2/28/2018 1:30:00 PM
HB 43
HB 43 - Supporting Document - Legislative Map.pdf SJUD 2/28/2018 1:30:00 PM
HB 43
HB 43 - Supporting Document - Letter from Premera.pdf SJUD 2/28/2018 1:30:00 PM
HB 43
HB 43 - Explanation of Changes (ver. D to ver. J).pdf SJUD 2/28/2018 1:30:00 PM
HB 43
HB 43 - Letters of Support.pdf SJUD 2/28/2018 1:30:00 PM
HB 43
HB 43 - Presentation.pdf SJUD 2/28/2018 1:30:00 PM
HB 43
HB 43 - Sectional Analysis (ver. J).pdf SJUD 2/28/2018 1:30:00 PM
HB 43
HB 43 - Sponsor Statement.pdf SJUD 2/28/2018 1:30:00 PM
HB 43