Legislature(1999 - 2000)

04/13/1999 01:40 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
         SENATE LABOR AND COMMERCE COMMITTEE                                                                                    
                    April 13, 1999                                                                                              
                      1:40 P.M.                                                                                                 
MEMBERS PRESENT                                                                                                                 
Senator Jerry Mackie, Chairman                                                                                                  
Senator Tim Kelly, Vice Chairman                                                                                                
Senator Dave Donley                                                                                                             
Senator Loren Leman                                                                                                             
Senator Lyman Hoffman                                                                                                           
MEMBERS ABSENT                                                                                                                  
All Members Present                                                                                                             
COMMITTEE CALENDAR                                                                                                              
HOUSE BILL NO. 68                                                                                                               
"An Act extending the termination date of the Board of Pharmacy to                                                              
June 30, 2005; and providing for an effective date."                                                                            
     -MOVED HB 68 OUT OF COMMITTEE                                                                                              
CS FOR HOUSE BILL NO. 123(RLS)                                                                                                  
"An Act relating to the exemption from the requirement for payment                                                              
of minimum wage and overtime compensation for certain volunteers of                                                             
nonprofit organizations; exempting individuals who provide ski                                                                  
patrol services on a voluntary basis from the requirement for                                                                   
payment of minimum wage and overtime compensation; and providing                                                                
for an effective date."                                                                                                         
     -HEARD AND HELD                                                                                                            
CS FOR HOUSE BILL NO. 128(RLS)                                                                                                  
"An Act relating to lease-purchases of personal property."                                                                      
     -MOVED CSHB 128(RLS)OUT OF COMMITTEE                                                                                       
HOUSE BILL NO. 94                                                                                                               
"An Act removing employees of the Alcoholic Beverage Control Board                                                              
from the exempt service."                                                                                                       
     -MOVED HB 94 OUT OF COMMITTEE                                                                                              
PREVIOUS SENATE COMMITTEE ACTION                                                                                                
HB 68 - No previous action to consider.                                                                                         
HB 123 - No previous action to consider.                                                                                        
HB 128 - No previous action to consider.                                                                                        
HB 94 - No previous action to consider.                                                                                         
WITNESS REGISTER                                                                                                                
Representative Rokeberg                                                                                                         
State Capitol Bldg.                                                                                                             
Juneau, AK 99811-1182                                                                                                           
POSITION STATEMENT: Commented on HB 68 and HB 123.                                                                              
Mr. Dwight Perkins, Deputy Commissioner                                                                                         
Department of Labor                                                                                                             
P.O. Box 21149                                                                                                                  
Juneau, AK 99802-1149                                                                                                           
POSITION STATEMENT: Supported on HB 123.                                                                                        
Ms. Lisa Murkowski                                                                                                              
State Capitol Bldg.                                                                                                             
Juneau, AK 99811-1182                                                                                                           
POSITION STATEMENT: Sponsor of HB 128.                                                                                          
Mr. Brad Denison                                                                                                                
POSITION STATEMENT: Commented on HB 128.                                                                                        
Mr. Pat Harmon, Aide                                                                                                            
Representative Pete Kott                                                                                                        
State Capitol Bldg.                                                                                                             
Juneau, AK 99811-1182                                                                                                           
POSITION STATEMENT: Commented for the sponsor on HB 94.                                                                         
Mr. Doug Griffin                                                                                                                
Acholic Beverage Control Board                                                                                                  
550 W 7th #350                                                                                                                  
Anchorage, AK 99501                                                                                                             
POSITION STATEMENT: Commented on HB 94.                                                                                         
ACTION NARRATIVE                                                                                                                
TAPE 99-12, SIDE A                                                                                                              
Number 001                                                                                                                      
                    HB 68-BOARD OF PHARMACY                                                                                     
CHAIRMAN MACKIE called the Senate Labor and Commerce Committee                                                                  
meeting to order at 1:40 p.m. and announced HB 68 to be up for                                                                  
REPRESENTATIVE ROKEBERG explained that HB 68 is a housekeeping                                                                  
measure that extends the termination date of the Board of Pharmacy                                                              
to 2005 and follows the recommendations of the Legislative Budget                                                               
and Audit Committee.                                                                                                            
CHAIRMAN MACKIE noted that the standing policy is to extend Boards                                                              
for four years.  He asked why they suggested six years.                                                                         
REPRESENTATIVE ROKEBERG said there is the geographic differential                                                               
on the appointments to the Board members, but they try to get                                                                   
different judicial districts.                                                                                                   
SENATOR KELLY said he didn't have a problem with 2005.                                                                          
SENATOR LEMAN said he didn't have a problem with this particular                                                                
Board, but he wanted to be consistent.                                                                                          
SENATOR LEMAN moved to change the effective date from 2005 to 2003.                                                             
There were no objections and it was so ordered.                                                                                 
REPRESENTATIVE ROKEBERG said he had no objections to the change,                                                                
but it requires a title change, also.                                                                                           
SENATOR LEMAN moved to rescind his motion and asked for unanimous                                                               
consent.  There were no objections and it was so ordered.                                                                       
SENATOR LEMAN moved to pass HB 68.  There were no objections and it                                                             
was so ordered.                                                                                                                 
           HB 123-MINIMUM WAGE & OVERTIME EXEMPTIONS                                                                            
CHAIRMAN MACKIE announced HB 123 to be up for consideration.                                                                    
REPRESENTATIVE ROKEBERG explained that the National Ski Patrol                                                                  
requested an exemption from Alaska's Wage and Hour Act because in                                                               
many instances they work under the supervision of a profit making                                                               
organization; for example, Alyeska Ski Resort which employs                                                                     
professional as well as volunteer patrollers and the supervisors                                                                
are paid.  This bill only speaks to the volunteers and exempts them                                                             
from the Wage and Hour Act.  He said that organized labor does not                                                              
oppose this legislation and are quite sympathetic.                                                                              
SENATOR KELLY asked what the status was on the volunteers being                                                                 
covered by Workmen's Compensation.                                                                                              
MR. DWIGHT PERKINS, Deputy Commissioner, Department of Labor,                                                                   
testified that they are covered under the Worker's Compensation                                                                 
SENATOR KELLY asked him to verify that.                                                                                         
REPRESENTATIVE ROKEBERG mentioned that Eaglecrest Ski resort is                                                                 
under municipal ownership.                                                                                                      
MR. PERKINS said the Department supported this bill.  He explained                                                              
there are several nonprofits who have volunteers who are subject to                                                             
Wage and Hour and overtime laws if it wasn't changed.  The                                                                      
Department feels that certain organizations that are strictly                                                                   
volunteer like the Iditarod Groups should have the ability to                                                                   
volunteer their time and services without being paid compensation.                                                              
SENATOR LEMAN asked for an example in Alaska of an activity that                                                                
would not be a nonprofit activity of a nonprofit organization.                                                                  
REPRESENTATIVE ROKEBERG said the Salvation Army Thrift Shop paying                                                              
its workers was one example.                                                                                                    
MR. PERKINS added that there were a few organizations that are                                                                  
selling T-shirts or trinkets as their for-profit side that may have                                                             
very different rules affecting them.  Those people are being paid                                                               
and have to be compensated with minimum wage and overtime while                                                                 
working in the store.  The volunteers who wouldn't be paid are ones                                                             
working events like the Iditarod volunteers along the course.                                                                   
SENATOR LEMAN said he wasn't sure the language "engaged in                                                                      
nonprofit activities" was necessary.                                                                                            
CHAIRMAN MACKIE tried to clarify that in the case of the Salvation                                                              
Army, working in their Thrift shop is a forprofit activity, but for                                                             
a nonprofit organization.                                                                                                       
SENATOR LEMAN  wanted to know where Alaskan corporate laws separate                                                             
profit and nonprofit activities of a nonprofit organization.                                                                    
MR. PERKINS explained if Senator Leman is the manager of the                                                                    
Salvation Army Thrift Shop and he (Mr. Perkins) wants to work                                                                   
there, and Senator Leman controls the days and hours he works                                                                   
there, then there is an employer/employee relationship.  Under                                                                  
those guidelines, he would be eligible to be compensated for                                                                    
minimum wage and overtime.  The definition of volunteer is coming                                                               
and going as a volunteer.                                                                                                       
SENATOR LEMAN said his problem is with the phrase "nonprofit" in                                                                
the first line and the last addition to the same paragraph.  He                                                                 
asked if we have nonprofit organizations that have profit making                                                                
activities that are allowed under the law.  He wanted to know what                                                              
activities of nonprofit organizations exist that cause the                                                                      
legislature to want to clarify that.  He asked if there are                                                                     
"nonprofit activities going on in Alaska of nonprofit organizations                                                             
that are not nonprofit activities."                                                                                             
SENATOR LEMAN said he thought the words on line 9 "or other                                                                     
nonprofit organizations" was to make sure the Special Olympics and                                                              
the Ski Patrol were covered.                                                                                                    
REPRESENTATIVE ROKEBERG added for background that last year the                                                                 
Legislature redefined "business" to include nonprofit                                                                           
organizations.  The language in this bill actually came from Mr.                                                                
Randy Parr, Department of Labor, and it was reviewed by Legislative                                                             
Legal Service.                                                                                                                  
CHAIRMAN MACKIE announced that he intended to hold the bill over so                                                             
they could talk to the drafter to make sure it does what it's                                                                   
intended to do.                                                                                                                 
           HB 128-LEASE-PURCHASE OF PERSONAL PROPERTY                                                                           
CHAIRMAN MACKIE announced HB 128 to be up for consideration.                                                                    
REPRESENTATIVE LISA MURKOWSKI, sponsor of HB 128, said this is                                                                  
basically the "rent to own" bill; this is a fledgling industry in                                                               
our state and is growing quickly throughout the country.  It                                                                    
applies to renting personal property mostly for people who are                                                                  
temporary residents.  This bill makes it clear for the consumer to                                                              
know what his or her obligations are and the lease/purchase owner's                                                             
disclosure requirements.  There is nothing in the Alaska statutes                                                               
which addresses lease purchase situations.  There have been no                                                                  
specific problems in the industry; it's more preventative.  Forty                                                               
four other states have similar legislation that addresses the                                                                   
disclosure requirement.  She said they looked at legislation from                                                               
South Dakota and received input from people within the industry in                                                              
SENATOR HOFFMAN asked if in the description of rent purchase                                                                    
agreements, merchants don't require a security deposit or                                                                       
downpayment.  He asked if that was true in this legislation.                                                                    
REPRESENTATIVE MURKOWSKI indicated that was true.                                                                               
SENATOR LEMAN asked if there was a table that would establish what                                                              
a "fair market value" is and would it be the original purchase                                                                  
price or depreciated value, for instance.                                                                                       
REPRESENTATIVE MURKOWSKI said she understands that the purpose of                                                               
the fair market value disclosure is that there are no hidden                                                                    
agendas.  If you're going to rent it, it's going to cost so much                                                                
per week or month.  If you want to purchase it, you want to know                                                                
what the value of the T.V. will be.                                                                                             
SENATOR LEMAN noted that there is a late fee of $5 and asked if                                                                 
there was a restriction on the amount of the fee and is there some                                                              
other way for a business to recover the cost of someone's payment                                                               
being late.                                                                                                                     
Number 450                                                                                                                      
REPRESENTATIVE MURKOWSKI responded that the reason a nominal late                                                               
fee was placed in there is because typically within the industry                                                                
they don't charge a late fee.  It came from the industry as being                                                               
a reasonable sum.  Usually, property is either returned voluntarily                                                             
or it is repossessed.                                                                                                           
MR. BRAD DENISON, testifying from New Jersey, said this bill is                                                                 
very similar to what most of the other states have.  It's based on                                                              
suggested legislation from the Council of State Governments which                                                               
is existing Virginia state law.  As far as he knows, no one in the                                                              
industry is charging a security deposit; and he didn't think this                                                               
bill addressed that issue.  Industry's position is that late fees                                                               
should be left up to the individual dealer and should depend on the                                                             
market place.                                                                                                                   
There is no table of fair market value if the merchandise is                                                                    
damaged, but there is a formula that most dealers use to determine                                                              
the value of the property at any time.  It's based on the cash                                                                  
price of the goods at the outset of the transaction.  For instance,                                                             
if at the outset a T.V. is valued at $300, the customer can buy it                                                              
by tendering an amount equal to the cash price less 50 percent of                                                               
all the rent paid.  The is the formula for determining fair market                                                              
value.  As a practical matter, when something happens to the goods,                                                             
it turns out to be a loss for everyone, because many customers                                                                  
don't have the cash to pay for the T.V.  It hasn't been a big issue                                                             
in the industry.                                                                                                                
MR. DENISON explained the late fee of $5 is to recover the cost of                                                              
having to either make phone calls or send letters.  It also serves                                                              
as an incentive for the customer to make on-time payments.                                                                      
Number 532                                                                                                                      
SENATOR LEMAN moved to pass HB 128 with individual recommendations.                                                             
There were no objections and it was so ordered.                                                                                 
          HB 94-ABC BD EMPLOYEES NOT EXEMPT EMPLOYEES                                                                           
CHAIRMAN MACKIE announced HB 94 to be up for consideration.                                                                     
MR. PAT HARMON, Aide to Senator Kott, sponsor, said HB 94 is a                                                                  
housekeeping measure.  The statutes presently classify the agents                                                               
of the Alcoholic Beverage Control Board as exempt employees when                                                                
they are classified employees.  They are no longer appointed; the                                                               
patronage system is no longer applied as they are basically                                                                     
professional police officers.  To delete that section would make                                                                
them classified employees by default which they actually are.                                                                   
SENATOR KELLY asked how many there were.                                                                                        
MR. HARMON answered there were three with one supervisor.                                                                       
SENATOR KELLY asked if they were union members.                                                                                 
MR. HARMON answered there was a union involved.                                                                                 
SENATOR KELLY asked if there were any retirement or benefits                                                                    
Number 561                                                                                                                      
MR. DOUG GRIFFIN, ABC Board, said the Administration, the                                                                       
Department, and the Board officially have no position on the bill                                                               
which came from employees who work for the ABC Board.  There are                                                                
four positions affected by this legislation, the enforcement                                                                    
investigative staff of the Board.  The three investigative                                                                      
positions are members of the general government bargaining unit.                                                                
The supervisor is a member of the supervisory bargaining unit.  He                                                              
is glad that Representative Kott put this bill forward.                                                                         
CHAIRMAN MACKIE asked if this changed their union status.                                                                       
MR. GRIFFIN answered, "Absolutely not."  They researched back 30                                                                
years and didn't find ABC investigators were ever exempt employees.                                                             
SENATOR KELLY asked once they become classified employees, can they                                                             
change unions.                                                                                                                  
MR. PERKINS answered that they have been classified employees in                                                                
the unions.                                                                                                                     
TAPE 99-12, SIDE B                                                                                                              
He couldn't predict the future, but couldn't see any requirements                                                               
that would trigger them changing unions.                                                                                        
SENATOR LEMAN asked if they were currently evaluated for merit pay                                                              
and if their pay increases were based on that evaluation, and if                                                                
so, what is the process that is used.  How many of the four                                                                     
employees received the merit pay based on that process.                                                                         
MR. PERKINS replied that they are evaluated like other classified                                                               
employees in state employment.  They have an annual evaluation and                                                              
typically are awarded merit increases.  They are evaluated on their                                                             
effectiveness in dealing with licensees, the thoroughness of their                                                              
investigations and reports.  They look at how well they prepare the                                                             
occasional prosecutions and how well they conduct themselves in                                                                 
discussing issues and problems with liquor licensees.  They need to                                                             
have knowledge of Title 4.                                                                                                      
SENATOR KELLY said he didn't have any problem with this bill if                                                                 
they would not switch unions.                                                                                                   
He moved to pass HB 94 from committee with individual                                                                           
recommendations.  There were no objections and it was so ordered.                                                               
CHAIRMAN MACKIE adjourned the meeting at 2:25 p.m.                                                                              

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