Legislature(2003 - 2004)

04/06/2004 02:04 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                                                                        
                         April 6, 2004                                                                                          
                           2:04 p.m.                                                                                            
TAPE(S) 04-31                                                                                                                 
MEMBERS PRESENT                                                                                                               
Senator Con Bunde, Chair                                                                                                        
Senator Ralph Seekins, Vice Chair                                                                                               
Senator Gary Stevens                                                                                                            
Senator Bettye Davis                                                                                                            
Senator Hollis French                                                                                                           
MEMBERS ABSENT                                                                                                                
All members present                                                                                                             
COMMITTEE CALENDAR                                                                                                            
SENATE BILL NO. 27                                                                                                              
"An Act relating  to pesticide use; relating  to program receipts                                                               
collected  by the  Department of  Environmental Conservation  for                                                               
registrations and licenses relating  to pesticides; and providing                                                               
for an effective date."                                                                                                         
     MOVED CSSB 27(L&C) OUT OF COMMITTEE                                                                                        
HOUSE BILL NO. 341                                                                                                              
"An Act relating to the dive fishery management assessment."                                                                    
     MOVED HB 341 OUT OF COMMITTEE                                                                                              
CS FOR HOUSE BILL NO. 15(FIN) am                                                                                                
"An Act relating to fair trade practices and consumer                                                                           
protection,   to    telephone   solicitations,    to   charitable                                                               
solicitations; and providing for an effective date."                                                                            
     HEARD AND HELD                                                                                                             
HOUSE BILL NO. 356                                                                                                              
"An Act relating to operation of alcoholic beverage delivery                                                                    
sites; and providing for an effective date."                                                                                    
     MOVED HB 356 OUT OF COMMITTEE                                                                                              
SENATE BILL NO. 341                                                                                                             
"An Act relating to the administration of the Alaska Vocational                                                                 
Technical Center; and providing for an effective date."                                                                         
     MOVED SB 341 OUT OF COMMITTEE                                                                                              
2D CS FOR HOUSE BILL NO. 288(RLS)                                                                                               
"An Act changing the name of the Department of Community and                                                                    
Economic Development to the Department of Commerce, Community,                                                                  
and Economic Development."                                                                                                      
     MOVED SCS 2D CSHB 288(STA) OUT OF COMMITTEE                                                                                
SENATE BILL NO. 272                                                                                                             
"An  Act  relating to  certain  monetary  advances in  which  the                                                               
deposit or  other negotiation of  certain instruments to  pay the                                                               
advances  is delayed  until a  later date;  and providing  for an                                                               
effective date."                                                                                                                
     HEARD AND HELD                                                                                                             
PREVIOUS COMMITTEE ACTION                                                                                                     
BILL: SB  27                                                                                                                  
SHORT TITLE: TRACKING OF PESTICIDE USE                                                                                          
SPONSOR(s): SENATOR(s) ELLIS                                                                                                    
01/21/03       (S)       PREFILE RELEASED 1/17/03                                                                               
01/21/03       (S)       READ THE FIRST TIME - REFERRALS                                                                        
01/21/03       (S)       L&C, RES, FIN                                                                                          
02/26/04       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
02/26/04       (S)       Heard & Held                                                                                           
02/26/04       (S)       MINUTE(L&C)                                                                                            
04/01/04       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
04/01/04       (S)       Heard & Held                                                                                           
04/01/04       (S)       MINUTE(L&C)                                                                                            
04/06/04       (S)       L&C AT 2:00 PM BELTZ 211                                                                               
BILL: HB 341                                                                                                                  
SHORT TITLE: DIVE FISHERY MANAGEMENT ASSESSMENT                                                                                 
SPONSOR(s): REPRESENTATIVE(s) WILLIAMS                                                                                          
01/12/04       (H)       PREFILE RELEASED 1/2/04                                                                                
01/12/04       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/12/04       (H)       FSH, RES                                                                                               
02/04/04       (H)       FSH RPT 6DP 1NR                                                                                        
02/04/04       (H)       DP: GARA, OGG, HEINZE, WILSON,                                                                         
02/04/04       (H)       SAMUELS, SEATON; NR: GUTTENBERG                                                                        
02/04/04       (H)       FSH AT 8:30 AM CAPITOL 124                                                                             
02/04/04       (H)       Moved Out of Committee                                                                                 
02/04/04       (H)       MINUTE(FSH)                                                                                            
02/16/04       (H)       RES AT 1:00 PM CAPITOL 124                                                                             
02/16/04       (H)       Scheduled But Not Heard                                                                                
02/25/04       (H)       RES AT 1:00 PM CAPITOL 124                                                                             
02/25/04       (H)       Moved Out of Committee                                                                                 
02/25/04       (H)       MINUTE(RES)                                                                                            
02/26/04       (H)       RES RPT 8DP 1DNP                                                                                       
02/26/04       (H)       DP: HEINZE, STEPOVICH, GATTO, LYNN,                                                                    
02/26/04       (H)       WOLF, KERTTULA, MASEK, DAHLSTROM;                                                                      
02/26/04       (H)       DNP: GUTTENBERG                                                                                        
03/15/04       (H)       TRANSMITTED TO (S)                                                                                     
03/15/04       (H)       VERSION: HB 341                                                                                        
03/17/04       (S)       READ THE FIRST TIME - REFERRALS                                                                        
03/17/04       (S)       L&C, FIN                                                                                               
04/01/04       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
04/01/04       (S)       Heard & Held                                                                                           
04/01/04       (S)       MINUTE(L&C)                                                                                            
04/06/04       (S)       L&C AT 2:00 PM BELTZ 211                                                                               
BILL: HB  15                                                                                                                  
SHORT TITLE: SOLICITATIONS/CONSUMER PROTECTION                                                                                  
SPONSOR(s): REPRESENTATIVE(s) FATE                                                                                              
01/21/03       (H)       PREFILE RELEASED (1/10/03)                                                                             
01/21/03       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/21/03       (H)       L&C, STA, FIN                                                                                          
01/29/03       (H)       L&C AT 3:15 PM CAPITOL 17                                                                              
01/29/03       (H)       <Bill Postponed>                                                                                       
02/07/03       (H)       L&C AT 3:15 PM CAPITOL 17                                                                              
02/07/03       (H)       Moved CSHB 15(L&C) Out of Committee                                                                    
02/07/03       (H)       MINUTE(L&C)                                                                                            
02/10/03       (H)       L&C RPT CS(L&C) NT 3DP 4AM                                                                             
02/10/03       (H)       DP: CRAWFORD, ROKEBERG, ANDERSON;                                                                      
02/10/03       (H)       AM: LYNN, GATTO, GUTTENBERG, DAHLSTROM                                                                 
02/18/03       (H)       STA AT 8:00 AM CAPITOL 102                                                                             
02/18/03       (H)       Heard & Held                                                                                           
02/18/03       (H)       MINUTE(STA)                                                                                            
02/25/03       (H)       STA AT 8:00 AM CAPITOL 102                                                                             
02/25/03       (H)       Scheduled But Not Heard                                                                                
03/11/03       (H)       STA AT 8:00 AM CAPITOL 102                                                                             
03/11/03       (H)       Heard & Held                                                                                           
03/11/03       (H)       MINUTE(STA)                                                                                            
03/13/03       (H)       STA AT 8:00 AM CAPITOL 102                                                                             
03/13/03       (H)       Moved CSHB  15(STA) Out of Committee                                                                   
03/13/03       (H)       MINUTE(STA)                                                                                            
03/26/03       (H)       STA RPT CS(STA) NT 3DP 4NR                                                                             
03/26/03       (H)       DP: SEATON, GRUENBERG, WEYHRAUCH;                                                                      
03/26/03       (H)       NR: HOLM, LYNN, DAHLSTROM, BERKOWITZ                                                                   
02/19/04       (H)       FIN AT 1:30 PM HOUSE FINANCE 519                                                                       
02/19/04       (H)       Heard & Held                                                                                           
02/19/04       (H)       MINUTE(FIN)                                                                                            
02/23/04       (H)       FIN AT 1:30 PM HOUSE FINANCE 519                                                                       
02/23/04       (H)       Moved CSHB 15(FIN) Out of Committee                                                                    
02/23/04       (H)       MINUTE(FIN)                                                                                            
02/24/04       (H)       FIN RPT CS(FIN) NT 7DP 3NR                                                                             
02/24/04       (H)       DP: HAWKER, CROFT, CHENAULT, FATE,                                                                     
02/24/04       (H)       MEYER, HARRIS, WILLIAMS; NR: STOLTZE,                                                                  
02/24/04       (H)       JOULE, MOSES                                                                                           
03/03/04       (H)       TRANSMITTED TO (S)                                                                                     
03/03/04       (H)       VERSION: CSHB 15(FIN) AM                                                                               
03/04/04       (S)       READ THE FIRST TIME - REFERRALS                                                                        
03/04/04       (S)       L&C, JUD                                                                                               
03/25/04       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/25/04       (S)       Heard & Held                                                                                           
03/25/04       (S)       MINUTE(L&C)                                                                                            
04/06/04       (S)       L&C AT 2:00 PM BELTZ 211                                                                               
BILL: HB 356                                                                                                                  
SHORT TITLE: EXTEND ALCOHOL DELIVERY SITE SUNSET                                                                                
SPONSOR(s): REPRESENTATIVE(s) JOULE                                                                                             
01/12/04       (H)       PREFILE RELEASED 1/2/04                                                                                
01/12/04       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/12/04       (H)       L&C                                                                                                    
02/09/04       (H)       L&C AT 3:15 PM CAPITOL 17                                                                              
02/09/04       (H)       Moved Out of Committee                                                                                 
02/09/04       (H)       MINUTE(L&C)                                                                                            
02/12/04       (H)       L&C RPT 4DP                                                                                            
02/12/04       (H)       DP: LYNN, GATTO, DAHLSTROM, ANDERSON                                                                   
02/19/04       (H)       TRANSMITTED TO (S)                                                                                     
02/19/04       (H)       VERSION: HB 356                                                                                        
02/20/04       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/20/04       (S)       L&C                                                                                                    
03/02/04       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/02/04       (S)       Heard & Held                                                                                           
03/02/04       (S)       MINUTE(L&C)                                                                                            
04/06/04       (S)       L&C AT 2:00 PM BELTZ 211                                                                               
BILL: SB 341                                                                                                                  
SHORT TITLE: AVTEC ADMINISTRATION                                                                                               
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
02/16/04       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/16/04       (S)       L&C, FIN                                                                                               
04/06/04       (S)       L&C AT 2:00 PM BELTZ 211                                                                               
BILL: HB 288                                                                                                                  
SHORT TITLE: CHANGING NAME OF DEPT OF COMM & ECON DEV.                                                                          
SPONSOR(s): REPRESENTATIVE(s) KOHRING                                                                                           
04/28/03       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/28/03       (H)       STA, L&C                                                                                               
05/06/03       (H)       STA AT 8:00 AM CAPITOL 102                                                                             
05/06/03       (H)       Moved CSHB 288(STA) Out of Committee                                                                   
05/06/03       (H)       MINUTE(STA)                                                                                            
05/08/03       (H)       STA RPT CS(STA) NT 3DP 1DNP 3NR                                                                        
05/08/03       (H)       DP: DAHLSTROM, LYNN, HOLM;                                                                             
05/08/03       (H)       DNP: BERKOWITZ; NR: SEATON, GRUENBERG,                                                                 
05/08/03       (H)       WEYHRAUCH                                                                                              
05/08/03       (H)       CRA REFERRAL ADDED AFTER L&C                                                                           
05/09/03       (H)       L&C AT 3:15 PM CAPITOL 17                                                                              
05/09/03       (H)       Moved CSHB 288(STA) Out of Committee                                                                   
05/09/03       (H)       MINUTE(L&C)                                                                                            
05/10/03       (H)       L&C RPT CS(STA) NT 3DP 1NR 2AM                                                                         
05/10/03       (H)       DP: GATTO, DAHLSTROM, LYNN;                                                                            
05/10/03       (H)       NR: ROKEBERG; AM: CRAWFORD, GUTTENBERG                                                                 
05/13/03       (H)       CRA RPT CS(STA) NT 2DP 3NR                                                                             
05/13/03       (H)       DP: WOLF, KOTT; NR: SAMUELS, CISSNA,                                                                   
05/13/03       (H)       MORGAN                                                                                                 
05/13/03       (H)       CRA AT 8:00 AM CAPITOL 124                                                                             
05/13/03       (H)       Moved CSHB 288(STA) Out of Committee                                                                   
05/13/03       (H)       MINUTE(CRA)                                                                                            
05/16/03       (H)       RETURNED TO RLS COMMITTEE                                                                              
05/19/03       (S)       L&C AT 8:00 AM BELTZ 211                                                                               
05/19/03       (S)       <Above Item Removed from Agenda>                                                                       
05/19/03       (S)       MINUTE(L&C)                                                                                            
01/20/04       (H)       RLS AT 9:30 AM BELTZ 211                                                                               
01/20/04       (H)       Moved CSHB 288(RLS) Out of Committee                                                                   
01/20/04       (H)       MINUTE(RLS)                                                                                            
01/21/04       (H)       RLS RPT 2D CS(RLS) NT 2DP 1DNP 2NR                                                                     
01/21/04       (H)       DP: COGHILL, ROKEBERG; DNP: KERTTULA;                                                                  
01/21/04       (H)       NR: MCGUIRE, KOTT                                                                                      
01/21/04       (H)       TRANSMITTED TO (S)                                                                                     
01/21/04       (H)       VERSION: 2D CSHB 288(RLS)                                                                              
01/23/04       (S)       READ THE FIRST TIME - REFERRALS                                                                        
01/23/04       (S)       STA, L&C                                                                                               
02/03/04       (S)       STA AT 3:30 PM BELTZ 211                                                                               
02/03/04       (S)       Moved   SCS   CSHB   288(STA)   Out   of                                                               
02/03/04       (S)       MINUTE(STA)                                                                                            
02/04/04       (S)       STA RPT SCS  2DP 1NR          NEW TITLE                                                                
02/04/04       (S)       DP: STEVENS G, STEDMAN; NR: GUESS                                                                      
04/06/04       (S)       L&C AT 2:00 PM BELTZ 211                                                                               
BILL: SB 272                                                                                                                  
SHORT TITLE: DEFERRED DEPOSIT ADVANCES (PAYDAY LOANS)                                                                           
SPONSOR(s): RULES                                                                                                               
01/21/04       (S)       READ THE FIRST TIME - REFERRALS                                                                        
01/21/04       (S)       L&C, FIN                                                                                               
04/06/04       (S)       L&C AT 2:00 PM BELTZ 211                                                                               
WITNESS REGISTER                                                                                                              
Ms. Kristin Ryan, Director                                                                                                      
Division of Environmental Health                                                                                                
Department of Environmental Conservation                                                                                        
410 Willoughby                                                                                                                  
Juneau, AK 99801-1795                                                                                                           
POSITION STATEMENT: Supports SB 27.                                                                                           
Mr. Everett Walton                                                                                                              
American Pest Management                                                                                                        
Anchorage AK                                                                                                                    
POSITION STATEMENT: Opposes SB 27.                                                                                            
Mr. Tim Barry                                                                                                                   
Staff to Representative Bill Williams                                                                                           
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Commented on HB 341 for sponsor.                                                                          
Ms. Julie Decker, Executive Director                                                                                            
Southeast Alaska Regional Dive Fisheries Association (SARDFA)                                                                   
PO Box 2138                                                                                                                     
Wrangell AK 99929                                                                                                               
POSITION STATEMENT: Supports HB 341.                                                                                          
Mr. Jim Pound                                                                                                                   
Staff to Representative Hugh Fate                                                                                               
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Commented on HB 15 for the sponsor.                                                                       
Mr. Robert Flint                                                                                                                
Hartig Rhodes Hoge & Lekisch                                                                                                    
717 K St.                                                                                                                       
Anchorage AK                                                                                                                    
POSITION STATEMENT: Opposes HB 15.                                                                                            
Mr. Dan Smith                                                                                                                   
Direct Marketing Association                                                                                                    
No address provided                                                                                                             
POSITION STATEMENT: Commented on HB 15.                                                                                       
Ms. Ann Darr                                                                                                                    
Magazine Publishers of America                                                                                                  
No address provided                                                                                                             
POSITION STATEMENT: Commented on HB 15.                                                                                       
Mr. Guy Bell, Director                                                                                                          
Administrative Services                                                                                                         
Department of Labor & Workforce                                                                                                 
PO Box 21149                                                                                                                    
Juneau, AK 99802-1149                                                                                                           
POSITION STATEMENT: Supports SB 341.                                                                                          
Mr. Ben Grenn                                                                                                                   
Staff to Representative Vic Kohring                                                                                             
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Commented on HB 288 for sponsor.                                                                          
Representative Vic Kohring                                                                                                      
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Sponsor of HB 288.                                                                                        
Ms. Sally Sadler, Legislative Liaison                                                                                           
Department of Community & Economic Development                                                                                  
PO Box 110800                                                                                                                   
Juneau, AK 99811-0800                                                                                                           
POSITION STATEMENT: Supports HB 288.                                                                                          
Mr. Richard Schmitz                                                                                                             
Staff to Senator John Cowdery                                                                                                   
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Commented on SB 272 for sponsor.                                                                          
Ms. Marie Darlin, Coordinator                                                                                                   
Capital City Task Force                                                                                                         
AARP Alaska                                                                                                                     
Juneau AK 99801                                                                                                                 
POSITION STATEMENT: Opposes SB 272.                                                                                           
Mr. Mark Davis, Director                                                                                                        
Division of Banking, Securities and Corporations                                                                                
Department of Community & Economic Development                                                                                  
PO Box 110800                                                                                                                   
Juneau, AK 99811-0800                                                                                                           
POSITION STATEMENT: Supports SB 272.                                                                                          
Mr. Ed Sniffen, Assistant Attorney General                                                                                      
Department of Law                                                                                                               
PO Box 110300                                                                                                                   
Juneau, AK  99811-0300                                                                                                          
POSITION STATEMENT: Supports SB 272.                                                                                          
Ms. Angela Liston                                                                                                               
Alaska Catholic Conference                                                                                                      
Anchorage AK                                                                                                                    
POSITION STATEMENT: Supports SB 272.                                                                                          
Ms. Joelle Hall                                                                                                                 
Eagle River AK                                                                                                                  
POSITION STATEMENT: Supports SB 272.                                                                                          
ACTION NARRATIVE                                                                                                              
TAPE 04-31, SIDE A                                                                                                            
                SB  27-TRACKING OF PESTICIDE USE                                                                            
CHAIR CON  BUNDE called  the Senate  Labor and  Commerce Standing                                                             
Committee meeting  to order  at 2:04  p.m. Present  were Senators                                                               
Gary Stevens, Ralph Seekins, Hollis  French, and Chair Con Bunde.                                                               
Senator  Bettye Davis  arrived at  2:10 p.m.  The first  order of                                                               
business to come before the committee was SB 27.                                                                                
SENATOR RALPH  SEEKINS moved to  adopt CSSB 27(L&C),  version /H,                                                               
for the working document. There were  no objections and it was so                                                               
CHAIR BUNDE  explained that  the new  version removes  the public                                                               
notice  warning requirement  for about  1,200 retailers;  it also                                                               
amends section 5 regarding farmers.                                                                                             
MS.  KRISTIN RYAN,  Director, Division  of Environmental  Health,                                                               
Department of  Environmental Conservation (DEC), agreed  with the                                                               
chair's short summary of the changes  in SB 27. She clarified the                                                               
second change saying that the  department considers all certified                                                               
applicators commercial; language was  changed to explicitly refer                                                               
only to commercial applicators. About 200 farmers are certified.                                                                
SENATOR  SEEKINS asked  her to  define  "private applicators"  on                                                               
page 1, line 4.                                                                                                                 
MS. RYAN  replied that  the term  is used to  reflect the  use of                                                               
restricted  use pesticides,  which one  must become  certified to                                                               
use. She noted that the fiscal note would remain the same.                                                                      
SENATOR BETTYE DAVIS arrived at 2:10 p.m.                                                                                       
MR.  EVERETT WALTON,  American Pest  Management,  said there  are                                                               
less  than  50 commercial  applicators  in  the whole  state.  In                                                               
Anchorage,  only  about 15  people  work  in  the business  on  a                                                               
regular basis.                                                                                                                  
     There isn't a  legitimate reason to pass  this bill out                                                                    
     of  committee.  This  bill  will  add  several  hundred                                                                    
     thousand dollars to the state  budget with no guarantee                                                                    
     that  the  money  can   be  recovered  by  implementing                                                                    
     registration fees.  It would  not surprise me  if fully                                                                    
     half  of the  chemicals  were  not reregistered.  After                                                                    
     all,  we  only have  600,000  people  in the  State  of                                                                    
     Alaska.... This  bill is  all about  growing government                                                                    
     for  the sake  of growth...  so  that it  can demand  a                                                                    
     larger  budget.... All  the  commercial applicators  in                                                                    
     this state  use only about  5 percent of  the chemicals                                                                    
     on  this list.  The  rest are  privately applied,  thus                                                                    
He accused that  the bill would be unenforceable  and wouldn't be                                                               
able to accomplish its stated purposes.                                                                                         
CHAIR BUNDE  observed that he  had a substantial amount  of input                                                               
from citizens requesting  that this bill be heard.  It's not just                                                               
a matter of government wanting to expand.                                                                                       
MR.  KEN PERRY,  Owner and  General Manager,  Paratex Pied  Piper                                                               
Pest  Control  of Alaska,  said  he  represented the  significant                                                               
number  of commercial  applicators doing  business in  Alaska and                                                               
the  National Pest  Management  Association,  the industry  trade                                                               
group.  He is  also in  contact with  the chemical  manufacturers                                                               
trade group called RISE.                                                                                                        
He accused  that supporters of  this bill had not  consulted with                                                               
industry or  trade groups  and he  sought to  provide information                                                               
that is being  withheld. He stated that the  $80 registration fee                                                               
is  a smoke  screen for  saying this  bill has  no cost.  He also                                                               
     I have  been informed  that all the  manufacturers with                                                                    
     current  registrations  in  Alaska  decided  to  review                                                                    
     their  lists and  determine which  chemicals they  will                                                                    
     continue to  register. The decision  is to be  based on                                                                    
     cost of  registration versus  potential income  and the                                                                    
     desirability  of   paying  the   State  of   Alaska  to                                                                    
     implement anti-pesticide legislation  against their own                                                                    
He closed requesting a no pass on this bill.                                                                                    
CHAIR  BUNDE reiterated  that his  office had  a great  number of                                                               
voters asking him to hear the bill. "It's called democracy."                                                                    
SENATOR SEEKINS  asked Ms. Ryan  why a household survey  is being                                                               
created  and it  appeared to  him that  there is  some intent  to                                                               
regulate household pesticides down the road.                                                                                    
MS. RYAN  replied that  her department has  said the  most common                                                               
misuse of pesticides  is by private homeowners and  the intent of                                                               
the  survey is  to understand  how homeowners  use pesticides  so                                                               
that future outreach can be  appropriately targeted. For example,                                                               
if  it finds  that  Alaskans are  frequently  using Diazanon  for                                                               
treating aphids,  it could create  outreach materials  to promote                                                               
less harmful alternatives.                                                                                                      
CHAIR BUNDE said some people want  to see all pesticides go away,                                                               
but those  who have been  exposed to malaria would  disagree with                                                               
that. He asked for her reasoning in that section.                                                                               
MS. RYAN explained  that her division is  interested in pesticide                                                               
use statewide  and, if it  were practical, wanted to  include the                                                               
household  reporting  component.  However,  at  this  point  that                                                               
oversteps her intention.  This bill is a good first  step to look                                                               
into  commercial  applications, a  lot  of  which take  place  in                                                               
public  buildings.  Some  of  that  information  could  be  found                                                               
already by looking through public  records. A statewide household                                                               
survey  would  be  statistically  valid  and  provide  beneficial                                                               
information to the  department, which could then  determine if it                                                               
needed to do more outreach.                                                                                                     
SENATOR SEEKINS said  her comment that registration  is the first                                                               
step  concerns him,  because he  doesn't  see the  next step  and                                                               
someone else does. He asked  if she thought anything accomplished                                                               
in this bill would reduce pesticide use in the State of Alaska.                                                                 
MS. GAREN TARR,  staff to Senator Ellis, sponsor,  stepped in and                                                               
said this is not an attempt  to reduce pesticide use, but more of                                                               
an attempt to know where they  are being used so that appropriate                                                               
decisions  can be  made about  public  and environmental  health.                                                               
That  would  include  helping  people   who  are  susceptible  to                                                               
exposure,  such as  people with  asthma or  a compromised  immune                                                               
SENATOR  SEEKINS  summarized that  it  won't  reduce the  use  of                                                               
pesticides,  but may  change the  way they  are applied  or which                                                               
ones  are  applied.  He  reflected  that  he  had  never  seen  a                                                               
definition of  a pesticide  and asked,  "Are we  regulating DEET?                                                               
Are   we  regulating   anti-snail  applications?   What  are   we                                                               
MS.  RYAN replied  that the  federal government  already requires                                                               
registration of  pesticides; an  $80 fee is  being added  to help                                                               
pay   for   the   program.  The   Department   of   Environmental                                                               
Conservation (DEC)'s  website has  a definition of  what products                                                               
are  regulated.  Currently,  there   are  about  5,700  regulated                                                               
SENATOR SEEKINS asked since the  state has primacy, does our list                                                               
include pesticides that are not included on the federal list.                                                                   
MS.  RYAN  replied that  the  department  would  not be  able  to                                                               
register any  pesticide products  for sale that  weren't approved                                                               
by the federal government.                                                                                                      
SENATOR SEEKINS  asked if our state  regulations exceeded federal                                                               
regulations for what is registered as a pesticide.                                                                              
MS.  RYAN  replied  that about  five  pesticides  are  registered                                                               
federally that are not registered for use in the state per year.                                                                
SENATOR FRENCH  moved to  pass CSSB  27(L&C) from  committee with                                                               
attached  fiscal note  and  individual recommendations.  Senators                                                               
Gary Stevens,  Bettye Davis,  Hollis French  and Chair  Con Bunde                                                               
voted  yea; Senator  Ralph Seekins  voted nay;  and CSSB  27(L&C)                                                               
moved from committee.                                                                                                           
           HB 341-DIVE FISHERY MANAGEMENT ASSESSMENT                                                                        
CHAIR CON BUNDE announced HB 341 to be up for consideration.                                                                    
MR. TIM  BARRY, staff to  Representative Bill  Williams, sponsor,                                                               
offered to answer questions.                                                                                                    
SENATOR HOLLIS FRENCH asked if  the administration supported this                                                               
MR. BARRY  answered that the  administration hadn't  commented on                                                               
the bill one way or the other. It  has a zero fiscal note and the                                                               
Department  of Revenue  will administer  collection of  the fees,                                                               
which it already does. The assessments will change.                                                                             
SENATOR  FRENCH  asked  if the  department  still  believed  that                                                               
changing the assessments would result in a zero fiscal note.                                                                    
MR.  BARRY  replied  that currently  the  Dive  Fish  Association                                                               
assesses itself at  one of four rates  - 1%, 3%, 5%  and 7%. This                                                               
bill allows  the association to  assess themselves at 2%,  4% and                                                               
6%.  To   that  extent,  the  department   isn't  doing  anything                                                               
MS. JULIE  DECKER, Executive Director, Southeast  Alaska Regional                                                               
Dive  Fisheries Association  (SARDFA), said  the association  has                                                               
developed good relationships with  the departments it worked with                                                               
along  with Alan  Austerman. The  concept behind  SARDFA has  had                                                               
nothing but support.                                                                                                            
SENATOR RALPH  SEEKINS moved to  pass HB 341 from  committee with                                                               
attached  fiscal note  and  individual recommendations.  Senators                                                               
Gary  Stevens, Bettye  Davis, Ralph  Seekins,  Hollis French  and                                                               
Chair  Con Bunde  voted yea;  and HB  341 was  moved to  its next                                                               
committee of referral.                                                                                                          
       CSHB  15(FIN)am-SOLICITATIONS/CONSUMER PROTECTION                                                                    
CHAIR CON  BUNDE announced HB 15  to be up for  consideration. He                                                               
noted  that Mr.  Robert  Flint expressed  concerns from  magazine                                                               
MR.  JIM  POUND,  staff to  Representative  Hugh  Fate,  sponsor,                                                               
responded  that  the  Department  of   Law  said  a  lot  of  the                                                               
complaints it receives  come from those types  of businesses. Mr.                                                               
Flint admitted there are about 2,300 of them in the country.                                                                    
MR.  ROBERT  FLINT,  Hartig  Rhodes   Hoge  &  Lekisch,  said  he                                                               
represents  the Direct  Marketing  Association  and the  Magazine                                                               
Publishers of America  on the portion of HB 15,  which relates to                                                               
the proposed amendments  to the Telemarketing Act.  He listed his                                                               
points as follows:                                                                                                              
     As I  mentioned before,  this statute, which  is common                                                                    
     to about  two dozen  states, was aimed  at fly-by-night                                                                    
     operators  and, therefore,  was deliberately  made very                                                                    
     burdensome.   As  an   example,  the   application  for                                                                    
     registration is 20 questions long  and you have to list                                                                    
     all your sales people.  The regulations also require if                                                                    
     the sales  people change within  90 days -  either they                                                                    
     leave  or you  add on  sales people  - you're  going to                                                                    
     have  to  file the  new  sales  people, which  includes                                                                    
     listing their home address.                                                                                                
     Moreover, every mistake  you make is a  class C felony,                                                                    
     which is a  $50,000 fine; for your first  offense - one                                                                    
     year in jail all the way up to five years.                                                                                 
     To put  the magazine  publishers and book  people under                                                                    
     this is a radical change  from the original purpose and                                                                    
     the  scope.   Right  now  there  are   eight  companies                                                                    
     registered  under the  Alaska  Telemarketing Act.  This                                                                    
     business  is  a  huge   national  business.  The  2,300                                                                    
     magazine and newsletters  are that only -  I don't know                                                                    
     the number of CDs, videos and booksellers.                                                                                 
     The fiscal  note here estimates  that maybe  30 instead                                                                    
     of eight  will register under the  Telemarketing Act if                                                                    
     these  amendments are  passed. If  anybody wants  to do                                                                    
     business  in  Alaska  among   those  2,300  people  for                                                                    
     magazines alone,  it will be  far higher than  that. If                                                                    
     those don't  register, then the enforcement  problem is                                                                    
     going to be a mess. At  a minimum, you're going to have                                                                    
     a constant  stream of paperwork  and bear in  mind that                                                                    
     this  business, which  has millions  of transactions  a                                                                    
     day  nationwide, these  callers are  from all  over the                                                                    
     country and,  indeed, outside  the country.  So, you're                                                                    
     going to  get the  list of  people from  Bangladesh and                                                                    
     India and South  Dakota filling up the  cabinets of the                                                                    
     Department of Law on a constant daily basis.                                                                               
     I think  one of the  elements here, if you  go forward,                                                                    
     the  committee  is entitled  to  a  fiscal note,  which                                                                    
     addresses   the   reality.   The   administrative   and                                                                    
     enforcement costs of  this - trying to  regulate a very                                                                    
     large national industry are going to be very high.                                                                         
     Now, the regulations in the  statute are still going to                                                                    
     interfere  with the  business. One  of the  things that                                                                    
     the regulations do not cover  is mail to an individual.                                                                    
     So, if  you get a card  or an ad from  Time Magazine in                                                                    
     your  mailbox and  inviting you  to  subscribe to  this                                                                    
     publication,  and  it says  you  can  either do  so  by                                                                    
     returning this card  or you can call an  800 number and                                                                    
     order it  over the  phone. Under  this bill,  you would                                                                    
     have  to  do  mail  only;  you  cannot  call  over  the                                                                    
     It  also excludes  existing customers.  That  is, if  a                                                                    
     company  has  an  existing   customer  they  have  done                                                                    
     business with,  they would also  run into this  act. We                                                                    
     have all  agreed... that cold-call marketing  - the guy                                                                    
     who  calls  you at  your  dinner  table, is  absolutely                                                                    
     dead. We  have a  vast number of  people who  signed up                                                                    
     for the Do  Not Call list. According to  all reports we                                                                    
     get from  the Federal Trade Commission,  it is working.                                                                    
     So,  I   think  that  problem  is   solved  in  another                                                                    
     direction,  which my  clients have  no objection  to at                                                                    
     all. We have had no evidence of need presented to us.                                                                      
     As   I  mentioned   before,  I   filed  a   Freedom  of                                                                    
     Information  Act request  with  the Attorney  General's                                                                    
     Office. You  know, we hear anecdotes  about problems in                                                                    
     an area,  but we cannot  get the statistics.  It's over                                                                    
     three weeks  and I've had  no response to  that Freedom                                                                    
     of  Information request  at  all.  There are,  however,                                                                    
     national statistics....                                                                                                    
     The  proposed regulators  have never  discussed in  any                                                                    
     detail or any  generality how this is  supposed to work                                                                    
     with this industry,  which I think, is sort  of a base-                                                                    
     line   before  you   want  to   go   and  create   this                                                                    
     administrative cost....                                                                                                    
     So,  I  would  summarize, the  amendments  don't  work.                                                                    
     They're unworkable  from the industry  standpoint, from                                                                    
     an  administrative standpoint  and from  an enforcement                                                                    
     standpoint.   They   are   consumer   prevention,   not                                                                    
     consumer protection.... I do  believe my principal, Ann                                                                    
     Darr, is on the phone,  who has been involved with this                                                                    
     for 30  years... I believe  she may have  some valuable                                                                    
     information for  the committee if she  may be permitted                                                                    
     to make some comments.                                                                                                     
MR.  DAN   SMITH  said  he   works  with  the   Direct  Marketing                                                               
Association and that Ann  Darr is on at the same  time if that is                                                               
acceptable to the chair who indicated it was.                                                                                   
MS.  ANN   DARR,  Magazine  Publishers  of   America,  said  that                                                               
telephone fraud in  the 80s was a terrible  problem that extended                                                               
into the  90s. Industry,  the Federal  Trade Commission,  the FBI                                                               
and the  State Attorneys General  all banded together to  do what                                                               
they could about  it. Telephone registration helped  and was most                                                               
effective  in  the southern  states  -  Florida, Arizona,  Orange                                                               
County, California and Las Vegas.                                                                                               
     Every state  that enacted a telephone  registration law                                                                    
     exempted  identifiable  substantial  sellers  that  the                                                                    
     Attorney General knew how to  locate should they have a                                                                    
     problem with  their marketing. No other  state includes                                                                    
     magazine  or books  or  recordings  in their  telephone                                                                    
     registration requirements.                                                                                                 
     We think  that telephone  fraud has largely  been taken                                                                    
     care of. The Federal Trade  Commission does not list it                                                                    
     as   one  of   its  chief   complaints.  The   Consumer                                                                    
     Federation  of American  - its  last  list of  consumer                                                                    
     complaints did  not, even in  their 12  complaints, did                                                                    
     not include  telephone marketing or magazines.  I think                                                                    
     the  Federal Trade  Commission  list included  magazine                                                                    
     complaints  as  one  percent.  When  you  consider  the                                                                    
     millions of  transactions we do every  year, there are,                                                                    
     of  course, going  to be  complaints. The  question is,                                                                    
     are  they unfair,  misleading and  deceptive practices.                                                                    
     Even  if it  were an  unfair, misleading  and deceptive                                                                    
     practice, to require every publisher  in the country to                                                                    
     go  through this  very  extensive registration  process                                                                    
     when  you think  of  putting down  the information  for                                                                    
     each officer, director,  trustee, general partner, etc.                                                                    
     etc. of  a company  such as Time  Warner, a  listing of                                                                    
     all telephone numbers used to  call consumers when they                                                                    
     have a  nationwide operation,  this would  be extremely                                                                    
     burdensome. We don't think it  would be helpful to have                                                                    
     companies have to  go through this process.  It is true                                                                    
     that if they  receive a mail solicitation,  and this is                                                                    
     the common way that we  solicit people, and invite them                                                                    
     to call a telephone number  to subscribe, then we would                                                                    
     be  required  to  register.  This  would  be  extremely                                                                    
     burdensome. Many  companies couldn't afford to  do it -                                                                    
     especially the smaller publications.                                                                                       
     The  general  intent  of  HB  15  was  to  make  Alaska                                                                    
     consistent  with the  Federal Trade  Commission Do  Not                                                                    
     Call list. The DMA certainly  has its members adhere to                                                                    
     that; 52.8  million American  consumers have  signed up                                                                    
     for the list. The FTC  says it's working and there were                                                                    
     a couple  of industry  groups, which included  the DMA,                                                                    
     who  were challenging  the law  in court;  the DMA  has                                                                    
     withdrawn its challenge....                                                                                                
     So, we have  no trouble with HB 15  as introduced. It's                                                                    
     what was amended into the  bill to delete the exemption                                                                    
     from  registration. Twenty-four  states have  telephone                                                                    
     registration laws  similar to  Alaska and none  of them                                                                    
     require  registration of  magazine sellers  or book  or                                                                    
     recording  companies.  One   state,  Arizona,  requires                                                                    
     companies to do a  one-page on-line simple registration                                                                    
CHAIR  BUNDE noted  that  Ms. Darr  had  raised some  interesting                                                               
questions and asked  the sponsor to work with her,  Mr. Flint and                                                               
Ms. Drinkwater to resolve them.                                                                                                 
           HB 356-EXTEND ALCOHOL DELIVERY SITE SUNSET                                                                       
CHAIR CON BUNDE  announced HB 356 to be up  for consideration. He                                                               
indicated that there was no new testimony.                                                                                      
SENATOR HOLLIS  FRENCH moved to  pass HB 356 from  committee with                                                               
attached  fiscal note  and  individual recommendations.  Senators                                                               
Ralph  Seekins, Hollis  French,  Gary Stevens,  Bettye Davis  and                                                               
Chair  Con  Bunde voted  yea;  and  HB  356  passed to  its  next                                                               
committee of referral.                                                                                                          
                  SB 341-AVTEC ADMINISTRATION                                                                               
CHAIR CON BUNDE announced SB 341 to be up for consideration.                                                                    
MR. GUY  BELL, Director,  Administrative Services,  Department of                                                               
Labor and  Workforce Development  (DOLWD), explained  that during                                                               
the  2002   session,  the  Legislature  enacted   SB  192,  which                                                               
transferred the  Alaska Vocational Technical School  (AVTEC) from                                                               
the Department of Education to the DOLWD.                                                                                       
TAPE 04-31, SIDE B                                                                                                            
MR. BELL  continued saying that  a fee review indicated  that the                                                               
transfer did  not include the tuition  and fee-setting authority.                                                               
This bill corrects  that oversight by giving  the commissioner of                                                               
DOLWD the authority to set  tuition and fees by regulation, which                                                               
includes a  public review  process, rather  than administratively                                                               
as  is done  now  and doesn't  have public  review.  It does  not                                                               
change the fees or the process in which they are established.                                                                   
SENATOR  FRENCH asked  if his  department had  been administering                                                               
AVTEC unlawfully over the past year.                                                                                            
MR. BELL said he wasn't a lawyer and didn't know.                                                                               
SENATOR GARY STEVENS asked if AVTEC supported the bill.                                                                         
MR. BELL replied yes.                                                                                                           
SENATOR FRENCH clarified that this is purely cleanup.                                                                           
MR. BELL replied yes.                                                                                                           
SENATOR  STEVENS  moved  to  pass  SB  341  from  committee  with                                                               
attached  zero   fiscal  note  and   individual  recommendations.                                                               
Senators  Bettye  Davis,  Gary  Stevens,  Ralph  Seekins,  Hollis                                                               
French and  Chair Con  Bunde voted  yea; and  SB 341  passed from                                                               
   2D CSHB 288(RLS)-CHANGING NAME OF DEPT OF COMM & ECON DEV.                                                               
CHAIR CON BUNDE announced HB 288 to be up for consideration.                                                                    
MR.  BEN   GRENN,  staff  to  Representative   Kohring,  sponsor,                                                               
explained  that HB  288 changes  the  name of  the Department  of                                                               
Community  & Economic  Development  (DCED) to  the Department  of                                                               
Commerce, Community  and Economic Development.  Confusion existed                                                               
as to the actual mission of  the department on whether Alaska had                                                               
an agency  that is  tasked with  promoting commerce  and economic                                                               
development, which  has somewhat  complicated efforts  to attract                                                               
investment to the  state. Adding the word commerce  back into the                                                               
title also makes it consistent with numerous other states.                                                                      
CHAIR BUNDE  asked if  community or  commerce has  any connection                                                               
with coalbed methane.                                                                                                           
MR. GRENN replied no at this point in time.                                                                                     
REPRESENTATIVE VIC  KOHRING, sponsor,  joined the  committee, and                                                               
exhorted the committee to pass it.                                                                                              
MS. SALLY SADLER, Legislative Liaison,  Department of Community &                                                               
Economic Development (DCED), supported HB 288.                                                                                  
     We  believe the  new  name does  encompass those  three                                                                    
     core  missions   and  functions  that   the  department                                                                    
     embraces  -   first  being  the   commerce,  regulating                                                                    
     business through  our banking  securities corporations,                                                                    
     through  our   Division  of   Insurance,  as   well  as                                                                    
     Occupational  and Business  Licensing. We  believe that                                                                    
     it also captures the work  of our Division of Community                                                                    
     Advocacy, which  is one of  our largest  divisions that                                                                    
     reaches out  and helps  communities achieve  that self-                                                                    
     sufficiency  and  govern   themselves  and  last,  that                                                                    
     certainly  not  least,   those  functions  of  economic                                                                    
     development in  which we have our  business development                                                                    
     specialists    who    promote   economic    development                                                                    
     opportunities  not only  for fishing  and tourism,  but                                                                    
     also for small business and mining....                                                                                     
A  zero fiscal  note accompanies  the legislation  and the  costs                                                               
will be absorbed as part of the department's on-going functions.                                                                
SENATOR RALPH  SEEKINS moved  to pass SCS  2D CSHB  288(STA) from                                                               
committee  with  individual  recommendations  and  attached  zero                                                               
fiscal note. Senators Bettye Davis,  Ralph Seekins, Gary Stevens,                                                               
Hollis French,  and Chair Con  Bunde voted  yea; and SCS  2D CSHB                                                               
288(STA) moved from committee.                                                                                                  
        SB 272-DEFERRED DEPOSIT ADVANCES (PAYDAY LOANS)                                                                     
CHAIR CON BUNDE announced SB 272 to be up for consideration.                                                                    
SENATOR RALPH SEEKINS  moved to adopt CSSB  272(L&C), version /D,                                                               
as the working  document. There were no objections and  it was so                                                               
MR. RICHARD SCHMITZ,  staff to Senator John Cowdery,  said the CS                                                               
puts the bill in alignment with the House version.                                                                              
MS.  MARIE DARLIN,  Coordinator,  Capital City  Task Force,  AARP                                                               
Alaska, noted  its letter in  the committee packet that  lays out                                                               
their concerns. She  explained that the task force  has worked in                                                               
partnership  with   The  Consumer  Federation  of   America,  the                                                               
Consumer's  Union,  and the  National  Consumer  Law Center  over                                                               
several years and  has developed a model bill, which  was sent to                                                               
the committee.                                                                                                                  
     That is more of what we  would like to see in the bill.                                                                    
     Among  our recommendations  are  that  we [indisc.]  no                                                                    
     less than two weeks for each  $50 owed on the loan. And                                                                    
     a consumer shall be permitted  to make partial payments                                                                    
     in amounts equal  to no less than $5  increments on the                                                                    
     loan at any time without  charge. The maximum amount of                                                                    
     the  deferred deposit  loan shall  not  exceed $300.  I                                                                    
     realize right  now they  have a limit  of $500  and the                                                                    
     bill  wants   to  increase  it  to   $1,000,  which  we                                                                    
     definitely  object to.  We are  sure  the committee  is                                                                    
     concerned with consumer protection,  as we are and that                                                                    
     is our main  concern.... If the term of the  loan is no                                                                    
     less  than two  weeks per  $50, consumers  will have  a                                                                    
     better  chance  of  paying off  the  loan  rather  than                                                                    
     defaulting and  possibly taking court action  or having                                                                    
     to  renew  the  loan  again  at  exorbitant  rates.  We                                                                    
     understand  that the  new version  of the  bill retains                                                                    
     the  maximum  amount  of $500  rather  than  increasing                                                                    
     available loan to $1,000, but  we believe Alaska should                                                                    
     reduce the  available amount from  $500 to  $300. These                                                                    
     are  monies paid  out  of someone's  pocket.  So it  is                                                                    
     interest.  If you  and  I  do not  pay  off our  credit                                                                    
     cards, we  pay interest.  If I take  out a  payday loan                                                                    
     and pay  an exorbitant  fee, much higher  than interest                                                                    
     on a  credit card, it's  still money and  a significant                                                                    
     amount of money and out of my pocket.                                                                                      
     When credit  card companies can make  a handsome profit                                                                    
     on interest  rates of 18%  to 23%, why cannot  a payday                                                                    
     loan outfit make a profit  with an interest rate or fee                                                                    
     that does not go beyond  36%? Our model law also allows                                                                    
     for an administrative fee of  no more than $5 per loan,                                                                    
     no matter  how much the  loan is for. Some  states have                                                                    
     determined that  payday lenders  should not  be allowed                                                                    
     to exist in their state.  AARP does not argue that they                                                                    
     should be banned; we only  argue that the interest rate                                                                    
     should  be no  more than  36% APR.  The available  loan                                                                    
     amount should  not be more  than $300 and  the borrower                                                                    
     should  be allowed  to make  partial repayment.  If the                                                                    
     consumer  has  more  than $300  in  outstanding  payday                                                                    
     loans  from  one  or  more   lenders,  they  should  be                                                                    
     prohibited from  taking out  any additional  loans from                                                                    
     any  payday  lending  organization.  This  is  consumer                                                                    
     interest to us,  but we believe this  is in everybody's                                                                    
     best interest.                                                                                                             
MR.   MARK   DAVIS,   Director,  Banking   and   Securities   and                                                               
Corporations,  Department  of  Community &  Economic  Development                                                               
(DCED),  said  he  is  ready  to take  over  regulation  of  this                                                               
industry  that is  currently  unregulated.  Forty-four states  do                                                               
regulate it. "We're basically in  favor of regulation in terms of                                                               
making sure that some rules are followed."                                                                                      
MR.  DAVIS said  there  is a  fiscal note  for  one more  banking                                                               
examiner. He  supported a  $500 limit;  any greater  amount would                                                               
make it incompatible with the current Small Loan Act.                                                                           
CHAIR BUNDE asked how he could make this issue revenue neutral.                                                                 
MR. DAVIS  replied that industry has  told him that there  are 10                                                               
companies  doing business  in the  state; he  found 30  locations                                                               
between Anchorage  and Fairbanks that  would have to  be checked.                                                               
Basically, another examiner would be  needed to do that. He added                                                               
that  the current  four examiners  work now  to stay  on schedule                                                               
with the state charter banks and credit union.                                                                                  
CHAIR  BUNDE clarified  that he  wasn't suggesting  doing without                                                               
another staff person, but was  looking for revenues with which to                                                               
pay him.                                                                                                                        
MR. DAVIS answered  that he has asked for a  registration fee and                                                               
an  hourly rate  for  the  examiners. "We  would  at least  break                                                               
CHAIR BUNDE asked if he would break even under the existing CS.                                                                 
MR. DAVIS replied that he wanted  to charge $75 per examiner hour                                                               
on location to make the bill revenue neutral.                                                                                   
SENATOR FRENCH said the charge on  the loan would be expressed as                                                               
a specific value - $15 per $100.                                                                                                
MR. DAVIS said he was only  trying to make consumers aware of how                                                               
much it cost them to borrow money.                                                                                              
MR.  ED SNIFFEN,  Assistant Attorney  General, Department  of Law                                                               
(DOL), said  he and  Cindy Drinkwater, DOL,  worked with  the Mr.                                                               
Davis and  the payday lenders to  craft the CS. A  section in the                                                               
bill already requires that APRs  be disclosed to consumers in the                                                               
form of  a placard in a  payday lenders shop that  identifies the                                                               
cost per  $100. It  is also  expressed in the  form of  an annual                                                               
percentage rate,  which is  required under  the Truth  in Lending                                                               
Act.  Another  provision  says that  other  federal  requirements                                                               
impose other disclosure obligations on a payday lender, as well.                                                                
Payday lenders are  not currently regulated and this  bill goes a                                                               
long  way   to  removing  the   problems  with  these   kinds  of                                                               
transactions. He  agreed with  Mr. Davis  that reducing  the loan                                                               
amount to  $300 from $500 would  be more trouble than  it's worth                                                               
to be consistent with the Small  Loan Act. He noted that the bill                                                               
has a limit of $15 and a $5  origination fee or 15 percent of the                                                               
amount loaned. "We put a 15  percent limit in there so if someone                                                               
wanted to  borrow $150,  they wouldn't get  charged for  the $200                                                               
cash  advance fee.  It  would  be something  in  between -  maybe                                                               
MR.  SNIFFEN  warned that  this  is  still a  fairly  significant                                                               
interest rate.  Some states allow  more, some less; this  bill is                                                               
in the middle of what is allowed in other states.                                                                               
     It's been  our experience  that what gets  consumers in                                                                    
     trouble  with these  kinds of  transactions is  not the                                                                    
     interest rate. It's  not the $15 per  $100 that creates                                                                    
     the  problem.  The  problem  comes  in  poor  financial                                                                    
     management from  the get-go, which brings  consumers to                                                                    
     these types of lenders in  the first place. So, I don't                                                                    
     know that  undue emphasis needs  to be  directed toward                                                                    
     the  interest rate  as a  percentage or  even as  a raw                                                                    
     dollar  figure.... The  problem,  of course,  is a  lot                                                                    
     deeper than that....                                                                                                       
He did not object to allowing partial payments and language                                                                     
could be inserted to that effect, but he wanted to hear from the                                                                
payday lenders on whether or not that would be problematic.                                                                     
CHAIR BUNDE said he was running out of time today and asked him                                                                 
to work with the bill's sponsor to address that question, along                                                                 
with the issue of trying to make this revenue neutral.                                                                          
MS. ANGELA LISTON, Alaska Catholic Conference, supported                                                                        
regulating the payday loan industry.                                                                                            
     The Catholic Church, of course,  has had a long history                                                                    
     of  opposing   exorbitant  interest  rates   and  we're                                                                    
     concerned  that this  type of  lending, which  was once                                                                    
     considered  a social  problem, is  really skyrocketing,                                                                    
     not  just here  in Alaska,  but nationally.  The people                                                                    
     who use  these loans are  the working poor.  If someone                                                                    
     was not  desperate, they wouldn't pay  $15 to borrowers                                                                    
     $100  for two  weeks. These  borrowers are  people that                                                                    
     don't  have  other  options.  In  most  states,  payday                                                                    
     lenders make  their money  on the  renewals or  what is                                                                    
     commonly  called  rollovers. In  California,  borrowers                                                                    
     average 11 loans  a year. In Illinois,  they average 13                                                                    
     loans a year.                                                                                                              
     This trend  doesn't suggest a consumer  service, but it                                                                    
     does  suggest  that  the  industry  moves  people  into                                                                    
     increasing  chronic and  hopeless  debt  and every  two                                                                    
     weeks they're  incurring another $15 fee  for that same                                                                    
     $100  loan.  Happily, in  Alaska,  we  learned from  an                                                                    
     industry representative at a  hearing in the House that                                                                    
     that's  not the  trend  here. In  fact,  out of  26,000                                                                    
     loans,  one  industry  rep  says  that  there's  24,000                                                                    
     customers, which is  an average closer to  one loan per                                                                    
     person.  If  that's  the  case, to  make  this,  a  bad                                                                    
     situation,  better, we  would like  to propose  that we                                                                    
     extend  the term  of the  loan. Right  now, it's  a two                                                                    
     weeks term  and we would  propose that it become  a 30-                                                                    
     day term,  giving people one  extra option  for another                                                                    
     paycheck  to  get  that  loan  paid  off  and  we  also                                                                    
     absolutely support the idea  of partial payment.... For                                                                    
     the industry it  would result in fewer  defaults and it                                                                    
     would have  no impact on  the industry since,  in fact,                                                                    
     they have  24,000 people who  are getting  these loans.                                                                    
     If the industry is making  its money off the rollovers,                                                                    
     then we  do have  problems, again,  because we  have to                                                                    
     admit  that these  constant  rollovers  and these  fees                                                                    
     exploit the working poor.                                                                                                  
MS. JOELLE  HALL, Eagle  River resident, said  she is  a military                                                               
wife and  served in the  Army from 1983  - 1989; her  husband has                                                               
many years  of military  service, as well.  She wanted  to relate                                                               
the  military applications  of this  bill. "These  payday lenders                                                               
tend  to ring  around military  installations and  from my  years                                                               
moving around,  I know  this to  be the case."  Her husband  is a                                                               
Sergeant-Major at  Fort Richardson  and she  thought at  first to                                                               
make these places  off limits if they were  operating without the                                                               
     I   feel  it's   very  important   to  regulate   these                                                                    
     organizations. If  we can't make  this kind  of lending                                                                    
     illegal,  then we  have to  regulate it  as best  as we                                                                    
     can. My hope is that we  can make this bill work better                                                                    
     for  the  military  clients  who   I  know  consume  an                                                                    
     inordinate number of these payday loans.                                                                                   
     The 30-day limit that was  mentioned earlier would be a                                                                    
     great benefit.  Soldiers and airmen have  the option of                                                                    
     getting paid every  15 days, but some of  them only get                                                                    
     paid every 30 days. So,  extending it to a 30-day limit                                                                    
     would greatly  allow those soldiers and  airmen to make                                                                    
     their  payments  on  time.  In  addition,  the  partial                                                                    
     payment question seems  to be one of  just decency. You                                                                    
     should  be able  to pay  a part  of your  principle any                                                                    
     time you take  out a loan. It's the way  we do business                                                                    
     in America with virtually every other kind of lending.                                                                     
     I read in  the minutes that industry  believes they are                                                                    
     providing a  service to poor people  by providing these                                                                    
     loans and I would just  urge this committee to remember                                                                    
     that some of  the people who are  procuring these loans                                                                    
     are  actually  performing  a  real  service  for  their                                                                    
     country and  we should be  thinking about them.  If the                                                                    
     industry is  really interested in providing  a service,                                                                    
     the least they can do is  make these loans a little bit                                                                    
     more compatible for their clients who wear a uniform.                                                                      
CHAIR  BUNDE responded  that he  remembered  being a  GI who  had                                                               
fellow GIs who wanted  to borrow $10 for a $20  pay back. If they                                                               
are  limited  commercially,  their creativity  would  remain  the                                                               
MS. HALL responded, "I believe legalized and illegal are                                                                        
different things."                                                                                                              
CHAIR BUNDE thanked her for  her testimony. He wanted the sponsor                                                               
and industry  to address the  amendments. There being  no further                                                               
business to come  before the committee, he  adjourned the meeting                                                               
at 3:28 p.m.                                                                                                                    

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