04/27/2007 01:30 PM Senate JUDICIARY
| Audio | Topic |
|---|---|
| Start | |
| Confirmation Hearing, Board of Governors of the Alaska Bar Association | |
| Confirmation Hearing, Violent Crimes Compensation Board | |
| Confirmation Hearing, Commission of Judicial Conduct | |
| Confirmation Hearing, Alaska Judicial Council | |
| SB141 | |
| SB38 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | SB 38 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| = | SB 141 | ||
ALASKA STATE LEGISLATURE
SENATE JUDICIARY STANDING COMMITTEE
April 27, 2007
1:39 p.m.
MEMBERS PRESENT
Senator Hollis French, Chair
Senator Bill Wielechowski
Senator Lesil McGuire
Senator Gene Therriault
MEMBERS ABSENT
Senator Charlie Huggins, Vice Chair
COMMITTEE CALENDAR
Confirmation Hearings
Board of Governors of the Alaska Bar Association
Dr. Donald McLean - Wasilla
CONFIRMATION ADVANCED
Commission of Judicial Conduct
Henry Novak - Kenai
CONFIRMATION ADVANCED
Alaska Judicial Council
Charles Kopp - Kenai
CONFIRMATION ADVANCED
Violent Crimes Compensation Board
Gerad Godfrey - Valdez
CONFIRMATION ADVANCED
SENATE BILL NO. 141
"An Act relating to limited liability companies."
MOVED SB 141 OUT OF COMMITTEE
SENATE BILL NO. 38
"An Act relating to scheduling Salvia divinorum and Salvinorin A
as controlled substances."
MOVED SB 38 OUT OF COMMITTEE
PREVIOUS COMMITTEE ACTION
BILL: SB 141
SHORT TITLE: LIMITED LIABILITY COMPANIES
SPONSOR(s): SENATOR(s) MCGUIRE
03/28/07 (S) READ THE FIRST TIME - REFERRALS
03/28/07 (S) JUD
04/23/07 (S) JUD AT 1:30 PM BELTZ 211
04/23/07 (S) Scheduled But Not Heard
BILL: SB 38
SHORT TITLE: SALVIA DIVINORUM AS CONTROLLED SUBSTANCE
SPONSOR(s): SENATOR(s) THERRIAULT
01/16/07 (S) PREFILE RELEASED 1/5/07
01/16/07 (S) READ THE FIRST TIME - REFERRALS
01/16/07 (S) HES, JUD, FIN
03/19/07 (S) HES AT 1:30 PM BUTROVICH 205
03/19/07 (S) Moved SB 38 Out of Committee
03/19/07 (S) MINUTE(HES)
03/21/07 (S) HES RPT 5DP
03/21/07 (S) DP: DAVIS, ELTON, THOMAS, COWDERY,
DYSON
04/27/07 (S) JUD AT 1:30 PM BELTZ 211
WITNESS REGISTER
DONALD RAE McLEAN
Wasilla, AK
POSITION STATEMENT: Governor's nominee to the Board of
Governors of the Alaska Bar Association
GERAD G. GODFREY
Valdez, AK
POSITION STATEMENT: Governor's reappointment nominee to the
Violent Crimes Compensation Board.
HENRY K. NOVAK
Kenai, AK
POSITION STATEMENT: Governor's nominee to the Commission of
Judicial Conduct.
CHARLES M. KOPP
Kenai, AK
POSITION STATEMENT: Governor's nominee to the Alaska Judicial
Council.
DAVID G. SHAFTELL, Attorney
Anchorage, AK
POSITION STATEMENT: Provided information related to SB 141.
DAVE STANCLIFF, Staff to Senator Therriault
POSITION STATEMENT: Introduced SB 38 for the sponsor.
ACTION NARRATIVE
CHAIR HOLLIS FRENCH called the Senate Judiciary Standing
Committee meeting to order at 1:39:50 PM. Present at the call to
order were Senator McGuire, Senator Wielechowski, Senator
Therriault, and Chair French.
CHAIR FRENCH announced the first order of business to be
confirmation hearings.
^Confirmation Hearing, Board of Governors of the Alaska Bar
Association
CHAIR FRENCH asked Dr. McLean to tell the committee about
himself and his interest in serving on the Board of Governors.
1:40:55 PM
DONALD RAE McLEAN, governor's nominee to the Board of Governors
of the Alaska Bar Association, introduced himself and
highlighted his professional career and other interests
including health law. He has practiced as a dentist in Wasilla
for about 26 years.
CHAIR FRENCH asked if he has a particular interest in any area
of law other than health.
DR. McLEAN replied he's currently taking a class in
administrative law and he finds it very interesting. It's the
interaction of government with people.
CHAIR FRENCH noted that he may send a packet with information
about a health care bill he recently submitted. That is separate
from this proceeding, he added. Finding no questions he
announced that committee members would sign a letter to forward
his name to the full body for consideration. Doing so does not
indicate an intention to vote either for or against the
appointee at a further time. No objection was stated, and the
name was advanced.
DR. McLEAN thanked Chair French and said that everyone he knows
appreciates the hard work that all legislators are doing in
Juneau.
At ease to do paperwork.
^Confirmation Hearing, Violent Crimes Compensation Board
CHAIR FRENCH announced the committee would hear from Gerad
Godfrey as a reappointment nominee for the Violent Crimes
Compensation Board. He asked him to tell the committee why he
continues to be interested in serving.
1:46:19 PM
GERAD G. GODFREY, governor's reappointment nominee to the
Violent Crimes Compensation Board, said when he was first
nominated four years ago the board had an ambitious agenda that
has grown more ambitious over time. For example the board is
working with the Tribal Victims Assistance agency within the
U.S. Department of Justice looking for grant money to assist
Alaska Natives who are victims of violent crimes. Another issue
the board is taking up is educating faith-based and safe
community representatives from Christian, Jewish, and Muslim
organizations about the resources that are available to victims
of violent crimes. The board has unfinished business, he
concluded.
CHAIR FRENCH thanked Mr. Godfrey for his work. "I know I speak
for the committee when I say that you are rapidly becoming one
of the statewide leaders in the area of victims' rights," he
said.
1:53:20 PM
SENATOR McGUIRE thanked Mr. Godfrey for his work. "I speak for
many other Alaskans when I say how grateful we are that you've
taken this tremendous tragedy in your life and turned it into a
venue by which you can help other victims of violent crime," she
stated.
MR. GODFREY said it's comforting to see the motivation and
foresight that legislators have. The bills that Senator French
and Senator McGuire have introduced are encouraging.
SENATOR THERRIAULT referred to his resume and asked if he had
graduated from the training academy and applied to become a fish
and wildlife trooper.
MR. GODFREY said he was hired as a trooper and he resigned
because of the politics at the time. He was asked to reconsider,
but he's never looked back. Currently he's working on a graduate
degree.
CHAIR FRENCH announced that committee members would sign a
letter to forward his name to the full body for consideration.
Doing so does not indicate an intention to vote either for or
against the appointee at a further time. No objection was
stated, and the name was advanced.
At ease to do paperwork.
^Confirmation Hearing, Commission of Judicial Conduct
1:57:27 PM
CHAIR FRENCH announced the committee would hear from Mr. Henry
Novak who has applied to be a member of the Commission of
Judicial Conduct. He asked him to explain his interest in
serving on the commission.
HENRY K. NOVAK, governor's nominee to the Commission of Judicial
Conduct, said he is the director of the Cook Inlet Council on
Alcohol and Drug Abuse. He said his background in working with
the court system in the substance abuse field gives him
experience to draw on.
CHAIR FRENCH asked him to explain the difference between the
Judicial Conduct Commission and the Judicial Council.
MR. NOVAK said he understands that the Commission on Judicial
Conduct investigates complaints of ethical concerns regarding
judges
CHAIR FRENCH summarized that the commission looks into charges
or allegations of misbehavior and unethical behavior by judges.
It conducts inquiries and offers proposed resolutions to the
charge.
MR. NOVAK added the commission deals with personal ethics. It
does not rule on any judgments that a judge has made.
CHAIR FRENCH thanked him for making that distinction. It is not
a court of appeals that looks into legal rationales; it looks at
the behavior of judges. He asked that the term is for serving.
MR. NOVAK said it's a four-year term. Responding to further
questions, he said he was born and raised in Alaska and he's
lived in Kenai for 14 years.
CHAIR FRENCH asked if he brings strong biases either for or
against judges and the legal system with respect to his new
duties.
MR. NOVAK said no. When he's been called to testify as an expert
witness on substance abuse issues he's always been treated
respectfully.
CHAIR FRENCH noted he had a BA in psychology and commented that
it may be useful in the near future.
CHAIR FRENCH announced that committee members would sign a
letter to forward his name to the full body for consideration.
Doing so does not indicate an intention to vote either for or
against the appointee at a further time. No objection was
stated, and the name was advanced.
At ease to do paperwork.
^Confirmation Hearing, Alaska Judicial Council
CHAIR FRENCH announced the committee would hear from Mr. Kopp.
He asked him to give his background and interest in becoming a
member of the Alaska Judicial Council.
CHARLES M. KOPP, governor's nominee to the Alaska Judicial
Council, said he was born and raised in Alaska. He highlighted
his personal and professional resume. He received a bachelor's
degree in justice from UAA and has worked for the Kenai Police
Department for 18 years. He's been chief for the last 5 years.
He interest in servings stems from a lifelong involvement with
the justice system including investigative case work, critical
incident management work, drug courts, prevention programs,
therapeutic courts, traffic safety and numerous other issues
that have brought him in contact with the courts. Also he said
he served as Kenai interim city manager for 9 months. His
background is broad and the sum of it has given him an interest
in the Alaska Judicial Council. In several years he will have
the option of retiring from public safety and it's quite likely
that he will further his education in the field of law.
2:05:37 PM
CHAIR FRENCH noted that he's stayed active in his field, which
is impressive and that he's participated in multiple community
service activities for more than a decade. "I salute you for
that," he said.
SENATOR McGUIRE highlighted criticisms of the council from last
year and said she was impressed that for the first time in 20
years the council reflected on its own bylaws and procedures and
then suggested to the legislature improvements for how judicial
appointments would be handled. She encouraged continued self
reflection because of the continual tension about whether judges
should be elected or not. Although she doesn't support electing
judges, she recognizes that some members of the public support
that practice. So it's important to continue to operate in a way
that gives the public a sense that the system works and has
integrity, she said.
SENATOR McGUIRE mentioned the subject of cluster or block voting
on the part of bar members and suggested the council give that
some thoughtful attention. Another issue is the right or ability
of a judicial applicant to confront his or her accuser. She
suggested these issues could be handled in the same confidential
manner as ethics complaints so that the accused and the accuser
would be afforded the opportunity to have a thorough vetting of
issues without having allegations hanging out there that can
hamstring a good candidate. She encouraged continued
improvements and the recognition that it is the Judicial Council
that is responsible for maintaining integrity and the public's
perception of integrity so it's not necessary to go to the
unfavorable system of electing judges.
2:09:10 PM
MR. KOPP said he agrees and he supports transparency with regard
to making council decisions. In fact he believes he was asked to
serve because of his perspective on the importance of Judicial
Council transparency. He noted that he wrote an open letter on
that subject and council members have responded favorably to his
comments. He understands that the council has critically
reviewed its process in terms of how public it is and how it can
be improved. Council members are very aware of the issue of
block voting, he said. We all tend to look through a lens of
bias that reflects our experience, he added. His objective is to
promote transparency in terms of how decisions are made and to
make sure that the governor has as much information as is needed
to make good appointments.
2:11:38 PM
CHAIR FRENCH referred to a policy dispute he has with Mr. Kopp
with regard to the make up of the Alaska Police Standards
Council and said reasonable minds can differ. "I don't bring any
position about that issue to my consideration here today," he
added.
MR. KOPP said he appreciates his saying so, but knowing the
chair's background he already had confidence that that was the
case.
CHAIR FRENCH noted the upcoming openings for judges in the Kenai
area and highlighted that he may be sitting on the judicial
council at that time and that his officers would appear before
those judges.
MR. KOPP said he's had conversations about that and he would
hope that he wouldn't bring any problematic biases. "I would
hope to be able to share my insights to the council…but if I'm
unreasonable my thinking can be corrected," he said.
CHAIR FRENCH thanked him for his willingness to serve. Finding
no further questions he announced that committee members would
sign a letter to forward his name to the full body for
consideration. Doing so does not indicate an intention to vote
either for or against the appointee at a further time. No
objection was stated, and the name was advanced.
At ease to do paperwork.
SB 141-LIMITED LIABILITY COMPANIES
2:16:35 PM
CHAIR FRENCH announced the consideration of SB 141.
SENATOR McGUIRE, sponsor of SB 141, said the bill is by request
of industry. It will clarify that an organization providing
professional services can organize its business using a limited
liability company (LLC). This will end speculation on the
authority of the use of an LLC for professional services. She
noted that a group of professionals meet to talk about recent
court decisions and statutes that have passed in other states
for the purpose of keeping Alaska current. The legislature
decides whether the policies that are suggested comport with
what it thinks is appropriate, she added.
2:19:40 PM
SENATOR McGUIRE explained that SB 141 is designed to keep the
state's trust and estate planning laws up to date and
competitive, thereby continuing to bring more business and
revenue into the state. To date Alaska has received over $2
million in direct revenue through increased life insurance
premium taxes, corporate taxes, and LLC and LP filings. Alaska
competes in these markets with at least 7 other states that have
enacted similar legislation, she said. Also, SB 141 will delete
AS 10.50.150(d) to allow a founder of an Alaskan LLC to be a co-
manager without having the assets of the company included in the
founder's gross estate for purposes of calculating federal tax.
2:22:00 PM
DAVID SHAFTELL, Attorney, said he is a member of the group to
which the sponsor referred. It includes attorneys and trust
officers who have worked since 1996 to improve trust and estate
statutes. A number of significant bills have passed giving
Alaska the opportunity to be a leader in this area, he said.
MR. SHAFTELL said SB 141 deals with two technical subjects.
First, it clarifies that professionals can use a limited
liability company as a business entity. The Division of
Corporations wisely has overlooked that statutory ambiguity and
approved the formation of LLCs. Although that has been the
administrative practice, he said some of us worry about it
ending up in court.
2:24:55 PM
CHAIR FRENCH commented he doesn't know how the language could be
wrongly construed, but he'll accept the suggestion to add the
phrase, "including the rendering of a professional service."
MR. SHAFTELL acknowledged the point and turned to Section 2,
which deals with an extremely technical subject that has caused
great concern among estate planners. Under 26 U.S.C. Sec.
2036(a)(2), if a person forms a trust or family limited
liability partnership (LLP) or a family LLC and retains powers
to effect the enjoyment of interests that the person has given
away or sold, then all those interests will be pulled back into
the founder's estate and taxed at his or her death. To avoid
this problem a special manager must be appointed to have
authority over distributions and liquidation of the LLC. To make
this effective, AS 10.50.150(d) must be deleted.
2:29:18 PM
CHAIR FRENCH clarified that Section 4 repeals subsection (d).
MR. SHAFTELL agreed that Section 4 deals with the second purpose
of the bill.
CHAIR FRENCH commented that those who don't practice in this
area of law approach it somewhat warily. When these bills come
through he always has a glimmer of concern because he isn't
conversant and experienced in these matters. However, nothing
suggests that a wrong step has been taken and he doesn't expect
anything different today. You and the other sponsors have been
very straightforward, he said.
CHAIR FRENCH closed public testimony and asked for discussion
among the members.
2:30:58 PM
SENATOR THERRIAULT disclosed that his wife practices in this
area of law. Also, he along with legislative drafters wrote the
first LLC law for Alaska. "It was one of my first bills," he
added.
SENATOR THERRIAULT motioned to report SB 141 from committee with
individual recommendations and attached zero fiscal note. There
being no objection, it was so ordered.
At ease for paperwork.
SB 38-SALVIA DIVINORUM AS CONTROLLED SUBSTANCE
2:32:44 PM
CHAIR FRENCH announced the consideration of SB 38.
SENATOR THERRIAULT, sponsor of SB 38, said Mr. Stancliff would
introduce the bill.
DAVE STANCLIFF, Staff to Senator Therriault, said the bill will
add Salvia divinorum, the most potent naturally occurring
hallucinogenic substance on the planet, to the state's list of
controlled substances. He cited cautionary testimony from users
and said that young people in particular are being targeted. The
problem law enforcement has with this substance is that it can't
be detected in the bloodstream. Another problem is that it's
readily available over the Internet and Alaska is considered to
be a "green-light" state for shipping the substance. In fact
it's being sold down the street and in other places around the
state as incense. Indications are that shipments stop or are
much reduced when an area becomes "red-light." Simply because
the substance can't be identified in the bloodstream should not
be an impediment to saying that Alaska is not a place to sell
Salvia divinorum.
SB 38 simply places Salvia divinorum on same schedule II list as
peyote, mescaline and LSD. This is not a safe drug, he
concluded.
2:39:26 PM
CHAIR FRENCH recalled the bill coming through judiciary last
year but he didn't recall its presence in local head shops. He
asked if this is a new phenomena.
MR. STANCLIFF replied he discovered one shop in Anchorage and
one in Fairbanks. Since that time a number of other locations
have the substance including one down the street here in Juneau.
It's a fairly good source of revenue. You can buy the leaf, the
plant, or the extract. Use is proliferating and youths are being
targeted. Many experienced "mind travelers" warn against its
use, particularly for youths. But there is support for allowing
people over age 18 to use the substance. That's a policy call
you have to think about, he said.
2:41:38 PM
SENATOR McGUIRE asked if the problem is that law enforcement
can't stop sales because there's nothing on the books about the
substance.
MR. STANCLIFF said that is the problem; currently there is
nothing that would allow interdiction.
SENATOR McGUIRE suggested it might be time to consider an
ability for the Department of Public Safety to use something
like the emergency regulation process before going to the
legislature for a full vetting.
MR. STANCLIFF said an advantage to law enforcement is that it is
very difficult to grow Salvia divinorum in places that it
doesn't occur naturally. If Alaska were to become a "red-light"
state it would be easier to control than a substance that
readily grows here.
2:44:56 PM
CHAIR FRENCH questioned why the federal government hasn't taken
any action on this substance.
MR. STANCLIFF answered it is on the Drug Enforcement
Administration (DEA) watch list and federal legislation is being
considered. Also, the Navy bans this substance as part of its
administrative code. "I think they're just lagging behind the
states…and the states aren't waiting," he added.
CHAIR FRENCH pointed out that the substance is legal today.
Passing this law means that in 90 days it would be a B felony to
possess and an A felony to sell or distribute. It seems as
though we've either severely under reacted on one side or we're
about to severely over react on the other, he said.
MR. STANCLIFF said he isn't sure what happened with regard to
transition periods when other psychotropic substances were made
illegal. There is an increased awareness and he knows that
Internet sites warn that Alaska is looking at outlawing the
substance. Currently someone could argue that they thought the
substance was sage and they'd have a good shot at a successful
defense because the best chemists at the state lab can't
identify the psychotropic substance from the plant.
CHAIR FRENCH clarified that the penalty for a C felony is 0-5
years with no presumptive sentence. The penalty for a B felony
is 0-10 years with no presumptive sentence, but there's a
guideline for serving. Referring to the statement that the lab
can't identify the substance, he questioned how the crime could
be prosecuted.
MR. STANCLIFF said a lab can identify the substance that causes
the psychotropic reaction. The chemical and botanical difficulty
is to identify that particular plant among thousands in the sage
family.
2:49:08 PM
SENATOR WIELECHOWSKI referred to an article that says that
Salvia divinorum has medical and research value. Noting that
it's potentially being used as a non-addictive painkiller, for
Alzheimer's disease, and mental illness he asked if this bill
would ban medical use or research.
MR. STANCLIFF said no. In fact this is the only substance of its
kind that promises to help people who have addictions to more
serious substances. On the other side there's evidence that it
exacerbates depression. It is an unpredictable substance and
very little is known about it. Error on the side of caution, but
keep the door open for medical and scientific purposes, he said.
SENATOR McGUIRE added there is nothing in the substance schedule
that prohibits prescription. The bill says the penalties come
into play unless the substance is prescribed. I don't see a
problem as long as research and prescription by a licensed
physician aren't prohibited.
CHAIR FRENCH observed that if the state makes the substance
illegal, head shops will stop carrying it and the market will
evaporate.
SENATOR McGUIRE suggested the committee consider an effective
date to allow the public time to learn about the change in law.
Intent language could also be added to make folks as aware as
possible.
CHAIR FRENCH brought up the topic of an effective date.
SENATOR THERRIAULT said his sense is that a limited number of
sites within the state are selling the substance so a long
period isn't necessary.
CHAIR FRENCH agreed that 90-days would do it.
2:53:39 PM
SENATOR THERRIAULT noted that the poison quarterly newsletter
warns against using Salvia divinorum. "There's a lot of alarming
information about this and the power of this drug so I think
it's advisable that we do take the step that is suggested in the
legislation today," he stated.
CHAIR FRENCH said he supported the bill in a previous session.
Finding no further questions or testimony he closed public
testimony.
SENATOR McGUIRE motioned to report SB 38 from committee with
individual recommendations and attached fiscal note(s). There
being no objection, it was so ordered.
There being no further business to come before the committee,
Chair French adjourned the meeting at 2:54:50 PM.
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