Legislature(2003 - 2004)

01/30/2003 01:35 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                    ALASKA STATE LEGISLATURE                                                                                  
          SENATE LABOR AND COMMERCE STANDING COMMITTEE                                                                        
                        January 30, 2003                                                                                        
                           1:35 p.m.                                                                                            
MEMBERS PRESENT                                                                                                               
Senator Con Bunde, Chair                                                                                                        
Senator Alan Austerman                                                                                                          
Senator Ralph Seekins                                                                                                           
Senator Bettye Davis                                                                                                            
Senator Hollis French                                                                                                           
MEMBERS ABSENT                                                                                                                
All members present                                                                                                             
COMMITTEE CALENDAR                                                                                                            
Confirmation Hearing - Greg O'Claray, Commissioner, Department                                                                  
of Labor and Workforce Development                                                                                              
     CONFIRMATION ADVANCED                                                                                                      
PREVIOUS ACTION                                                                                                               
No previous action to record.                                                                                                   
WITNESS REGISTER                                                                                                              
Commissioner-designee Greg O'Claray                                                                                             
Department of Labor & Workforce                                                                                                 
PO Box 21149                                                                                                                    
Juneau, AK 99802-1149                                                                                                           
ACTION NARRATIVE                                                                                                              
TAPE 03-2, SIDE A                                                                                                             
CHAIR CON  BUNDE called  the Senate  Labor and  Commerce Standing                                                             
Committee meeting  to order  at 1:35  p.m. Present  were Senators                                                               
Seekins,  French and  Chair Bunde.  Senators Davis  and Austerman                                                               
arrived shortly thereafter.                                                                                                     
He announced the purpose of today's meeting is to conduct a                                                                     
confirmation hearing for Commissioner Greg O'Claray.                                                                            
MR.  GREG O'CLARAY,  Commissioner-designee of  the Department  of                                                               
Labor  and Workforce  Development (DOLWD),  joined the  committee                                                               
and submitted answers  to questions he was asked  at the previous                                                               
hearing.  He  also  reviewed the  March  2002  DOLWD  publication                                                               
entitled,  Alaska  Economic  Trends, which  contains  information                                                             
regarding age distribution in the workforce.                                                                                    
COMMISSIONER-DESIGNEE  O'CLARAY  gave  a brief  synopsis  of  the                                                               
biographical  information  contained  in   his  resume  and  told                                                               
members  he became  a professional  mariner  before he  graduated                                                               
from  high school.  His maritime  career spanned  several decades                                                               
and included  membership in  the Seafarer's  International Union,                                                               
the  Inland  Boatmen's  Union  of  the  Pacific  and  the  Marine                                                               
Engineers   Beneficial   Association    (AFL-CIO).   That   group                                                               
represents  off-shore  licensed  marine engineers,  captains  and                                                               
mates  who crew  the boats  that haul  ANS crude  to market  from                                                               
Valdez, as well as Alaska  Marine Highway System workers. He said                                                               
he  has also  been involved  in civic  activities that  deal with                                                               
economic development. He told members,  "The maritime industry is                                                               
very pro-active  in terms of  jobs in the  economy.  Alaska  is a                                                               
non-contiguous  maritime state  that  relies  heavily on  surface                                                               
transportation so anything that  affects Alaska's economy affects                                                               
He said he  recently represented the Greens  Creek Mining Company                                                               
with respect  to a  long-term law that  restricted access  to the                                                               
face of the  mine, which is underground. He  helped modernize the                                                               
law to meet  today's working conditions. He also  lobbied for the                                                               
Fairbanks Gold Mining Company regarding  work hours. He no longer                                                               
represents  those clients;  he now  is a  public servant  for the                                                               
State of Alaska for the first time in his life.                                                                                 
CHAIR   BUNDE  noted   the  Governor   indicated  some   internal                                                               
performance audits  would be done  in some departments  and asked                                                               
how that was going.                                                                                                             
COMMISSIONER-DESIGNEE  O'CLARAY  replied  that  the  audit  would                                                               
determine  things that  could be  changed  immediately and  there                                                               
would be  a systematic evaluation  of all programs  following the                                                               
missions  and measures  guidance set  up by  the Legislature.  He                                                               
said  he would  also  like  to set  up  a  measuring device  that                                                               
mirrors the one  used by the Denali Commission  to track training                                                               
grants. The  Governor wants  dollars to be  spent on  training as                                                               
well as placement to provide real jobs at good pay                                                                              
COMMISSIONER-DESIGNEE  O'CLARAY explained  the  department has  a                                                               
vacant internal  auditor position because that  employee filled a                                                               
vacant position  in the administrative service  directorship. The                                                               
department was  recruiting for  the auditor  position as  of that                                                               
day.  He also  had the  Department of  Labor hallways  cleared of                                                               
accumulated  furniture  after  the  recent  re-carpeting  and  he                                                               
ordered OSHA inspections. There  were no life-threatening hazards                                                               
within the building,  but some things needed to  be addressed and                                                               
those would be done by the end of May.                                                                                          
He  said  he  was  trying  to address  the  perception  that  the                                                               
department is  not friendly to  employers and he has  reached out                                                               
to employers,  businesses and labor by  meeting with Commonwealth                                                               
North, the Anchorage Chamber of  Commerce, the Anchorage Economic                                                               
Development Council and employer groups  that are attached to the                                                               
various workforce investment boards.                                                                                            
The  Commissioner-designee  explained   that  Governor  Murkowski                                                               
issued  an  executive order  creating  the  Division of  Business                                                               
Partnerships and  renaming the service  delivery side of  the old                                                               
Employment  Security  Division  to   the  Division  of  Workforce                                                               
Services. Catherine Farnam from  BP Exploration was recruited and                                                               
brings experience in reorganization and direct industry contact.                                                                
COMMISSIONER-DESIGNEE   O'CLARAY  said   the  Governor   is  also                                                               
concerned  about  the size  of  the  boards that  administer  the                                                               
workforce  investment  programs  and  their  travel  expenses  to                                                               
attend meetings. The  thought is that the number  of boards could                                                               
be reduced. He also found that  industry was weary of the boards'                                                               
bureaucratic  system  and  was  frustrated  about  how  slow  the                                                               
process  is to  get  grants  on the  street  that actually  train                                                               
people for jobs.                                                                                                                
He noted  that almost  30 percent of  workers in  most industries                                                               
would retire  or leave in  the next five years.  The construction                                                               
industry  is  gearing  up  for that  now,  but  needs  additional                                                               
assistance   and  funding   for  apprenticeship   programs.  Most                                                               
industries in Alaska  recognize this problem and  he advised that                                                               
his  department could  play  a  major role  in  filling that  gap                                                               
through the Workforce Investment  Act. He stated, "The vocational                                                               
training must start even as early as the elementary years and K-                                                                
1:58 p.m.                                                                                                                     
COMMISSIONER-DESIGNEE  O'CLARAY explained  that  in  the last  20                                                               
years our school system has  moved away from vocational training,                                                               
particularly in  Bush areas. That  change is due to  the addition                                                               
of soft skills training for  things like appearance, hygiene, and                                                               
time/budget management skills. He said  the Governor asked him to                                                               
partner with  the Department  of Health  and Social  Services and                                                               
the Department of  Corrections to see if they  could complete the                                                               
welfare-to-work  initiative.  He   acknowledged  the  overcrowded                                                               
conditions  in  state  correctional   facilities  and  said  [the                                                               
administration]  would  like  to  bring the  offenders  that  are                                                               
incarcerated in Arizona back to Alaska.                                                                                         
CHAIR  BUNDE said  he  would  do anything  he  could  to get  the                                                               
Legislature to  help "restore  the dignity  of working  with your                                                               
hands."  He  emphasized  the   need  for  the  school-to-business                                                               
SENATOR  ALAN  AUSTERMAN  agreed  with the  need  for  vocational                                                               
education and  said he would like  to see it extended  to K-14 to                                                               
include the university system.                                                                                                  
SENATOR SEEKINS  said he employs 120  people and all of  them are                                                               
required  to read,  write and  do  mathematical calculations.  If                                                               
they  know how  to communicate,  they  can be  taught just  about                                                               
everything else they  need to know. He asked  if the commissioner                                                               
sees the  department as  a conduit to  the educational  system to                                                               
put  emphasis  on  obtaining  the  basic  skills  that  employers                                                               
require regardless  of whether those skills  are obtained through                                                               
a college degree program or vocational program.                                                                                 
COMMISSIONER-DESIGNEE O'CLARAY  replied he  expects to  have "not                                                               
only cross-pollination,  but total integration of  the philosophy                                                               
of  training a  21   century  workforce  that  fits the  industry                                                               
needs...." Basic  skill training has  to start in  the elementary                                                               
SENATOR SEEKINS  informed the committee that  he helped establish                                                               
a  joint training  program with  the  Ford Motor  Company at  the                                                               
University of  Alaska Anchorage. Ford Motor  Company provided the                                                               
trainer   while  the   University  provided   the  facility   and                                                               
curriculum. A  student can graduate  with an associate  degree in                                                               
automotive technology after two years.                                                                                          
CHAIR BUNDE  reiterated his support  of teaching the  "basics" in                                                               
SENATOR SEEKINS reemphasized the  importance of getting the basic                                                               
skills so  that employers can "teach  them the rest and  keep you                                                               
as an employee."                                                                                                                
2:15 p.m.                                                                                                                     
SENATOR  FRENCH questioned  Commissioner-designee O'Claray  about                                                               
some of the details on his resume.                                                                                              
COMMISSIONER-DESIGNEE  O'CLARAY  explained  that the  AFL-CIO  is                                                               
like  a federation  that people  are not  required to  belong to.                                                               
Under the AFL-CIO constitution, officers  are elected to give the                                                               
organization  representative  status   when  lobbying  issues  in                                                               
Washington D.C.                                                                                                                 
SENATOR  FRENCH asked  Mr. O'Claray  to comment  on his  lobbying                                                               
efforts  for  GCI, Greens  Creek  Mining  Company and  the  Trial                                                               
Lawyers on tort reform.                                                                                                         
COMMISSIONER-DESIGNEE  O'CLARAY  said  he represented  the  Trial                                                               
Lawyers  of  Florida  on  an issue  before  Congress.  A  certain                                                               
congressman was attempting to exclude  foreign seamen from access                                                               
to the United  States tort system for either  wage claims, damage                                                               
claims  or other  claims that  could not  be adjudicated  under a                                                               
labor  agreement  or  some  other  forum.  Most  of  the  foreign                                                               
flagships operate  out of  Florida and that's  where most  of the                                                               
tort business was on those claims.                                                                                              
With respect  to his Greens Creek/Kennicott  lobbying efforts, he                                                               
said a law had been on  the books since the 1920s that restricted                                                               
access to  below ground areas  for more  than eight hours  a day.                                                               
Greens Creek wanted to allow for  a 10-hour day below the surface                                                               
so it  could offer  a flex-schedule.  They argued  that it  was a                                                               
productivity issue.  The type of  work that  miners do now  is so                                                               
different from the work miners did  in 1920 that it made sense to                                                               
update the  law. In a  joint venture  with Reed Stoops  and James                                                               
Clark, he worked  to convince the labor movement  that this would                                                               
assist the company into sustainability  as a year-round employer.                                                               
Before this legislation  was offered, Greens Creek  had gone into                                                               
layoff  for a  year. The  effort was  successful and  offered the                                                               
additional benefit of  making it worthwhile for  people who lived                                                               
in other areas to commute to Juneau and work in the mine.                                                                       
COMMISSIONER-DESIGNEE O'CLARAY said the  struggle between GCI and                                                               
ACS is over which one  controls telecommunications in Alaska. He,                                                               
Mr.  Stoops and  Mr. Clark  lobbied  the Legislature  on how  the                                                               
Public Utilities  Commission (PUC)  operated. He  was "conflicted                                                               
out" because GCI was a non-union company.                                                                                       
SENATOR FRENCH asked him to comment  on cuts to the department in                                                               
reference to a letter to the editor about them.                                                                                 
COMMISSIONER-DESIGNEE O'CLARAY replied that  he couldn't give any                                                               
specifics  on the  Governor's  budget  proposal. All  departments                                                               
were  directed to  look  at reducing  their budgets  by  5 to  10                                                               
percent. He informed the committee  that he requested scrutiny of                                                               
the  Independent  Living  Program,  which  provides  services  to                                                               
disabled folks to  get them into the job market  or assistance so                                                               
they can live independently of institutions.                                                                                    
TAPE 03-02, SIDE B                                                                                                            
COMMISSIONER-DESIGNEE O'CLARAY said he  proposed cutting just the                                                               
general fund contribution  of $619,000. The budget  review is not                                                               
complete,   but  the   lawmakers   who   originally  funded   the                                                               
[Independent Living]  program wrote  him a letter  supporting the                                                               
funding and that letter somehow  got publicized and made him look                                                               
bad. He explained:                                                                                                              
     We were trying  to evaluate the program.  There will be                                                                    
     cuts  in almost  all  of our  programs  mostly made  by                                                                    
     efficiencies because  we will  continue to  provide the                                                                    
     service  that   they  have...but   I  can't   give  you                                                                    
     specifics. I'm  not so sure  that letter to  the editor                                                                    
     was  accurate  in  terms   of  describing  my  personal                                                                    
     feeling about disabled folks.                                                                                              
SENATOR  FRENCH asked  his position  on  Little Davis-Bacon  wage                                                               
COMMISSIONER-DESIGNEE  O'CLARAY replied  that  the Little  Davis-                                                               
Bacon Act  is the prevailing wage  act that applies to  the State                                                               
of Alaska. He said:                                                                                                             
     The  law requires  on public  funded projects  that the                                                                    
     prevailing wages of the region  be paid to construction                                                                    
     workers  whether  they  be union  or  non-union.  Those                                                                    
     rates are  required to be paid.  I can tell you  it has                                                                    
     been  a stabilizing  effect on  our economy  because we                                                                    
     are a  construction state. I  will not tell you  that I                                                                    
     favor  doing anything  that would  harm that.  Both our                                                                    
     Governor  and  our   congressional  delegation  are  in                                                                    
     support of the Davis Bacon...                                                                                              
SENATOR  SEEKINS asked  why  this is  called  the "little"  Davis                                                               
Bacon Act.                                                                                                                      
COMMISSIONER-DESIGNEE O'CLARAY  replied that the Davis  Bacon Act                                                               
is a  federal act and  the "little" Davis  Bacon Act is  that act                                                               
tweaked to apply to Alaska.                                                                                                     
SENATOR  FRENCH asked  him to  give  a short  description of  the                                                               
Marine Engineers Beneficial Association.                                                                                        
COMMISSIONER-DESIGNEE O'CLARAY responded:                                                                                       
     The  Marine  Engineers  Beneficial Association  is  the                                                                    
     oldest maritime  union in the United  States. It's over                                                                    
     126 years old. It was formed  by a group of engineers -                                                                    
     licensed marine engineers - in  Chicago sometime in the                                                                    
     late 1800s.  What the organization  does is  it lobbies                                                                    
     for and competes for, supports,  trains workers for the                                                                    
     American flag  merchant marine. The Sealine  ships that                                                                    
     you see coming in and out  of the Port of Anchorage are                                                                    
     staffed  by  licensed  marine  engineers  and  licensed                                                                    
     masters   and  mates,   as   well   as  the   Seafarers                                                                    
     International Union.                                                                                                       
He added it  is one of the smallest international  unions, but it                                                               
contributes  a  lot  of  hard and  soft  money  to  congressional                                                               
campaigns  because  of  the  need  for  access  to  promote  that                                                               
SENATOR SEEKINS  made a  motion to  forward Commissioner-designee                                                               
O'Claray's name  to the full  body for consideration  to confirm.                                                               
There was no objection and it was so ordered.                                                                                   
CHAIR BUNDE adjourned the meeting at 2:30 p.m.                                                                                  

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