Legislature(2005 - 2006)BELTZ 211

02/15/2005 01:30 PM LABOR & COMMERCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ SB 100 ENHANCED 911 SURCHARGES TELECONFERENCED
Heard & Held
+ HB 64 EXTEND BOARD OF PUBLIC ACCOUNTANCY TELECONFERENCED
Moved HB 64 Out of Committee
+ HB 47 EXTEND BOARD OF REAL ESTATE APPRAISERS TELECONFERENCED
Moved CSHB 47(FIN) Out of Committee
*+ SB 93 FISHING PERMIT AND VESSEL LICENSE FEES TELECONFERENCED
Heard & Held
Bills Previously Heard/Scheduled
= SB 52 OCCUPATIONS/CORPORATIONS/BANKS/SECURITIES
Moved CSSB 52(L&C) Out of Committee
                    ALASKA STATE LEGISLATURE                                                                                  
          SENATE LABOR AND COMMERCE STANDING COMMITTEE                                                                        
                       February 15, 2005                                                                                        
                           1:37 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Con Bunde, Chair                                                                                                        
Senator Ralph Seekins, Vice Chair                                                                                               
Senator Johnny Ellis                                                                                                            
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Senator Ben Stevens                                                                                                             
Senator Bettye Davis                                                                                                            
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 64                                                                                                               
"An Act  extending the termination  date for the Board  of Public                                                               
Accountancy; and providing for an effective date."                                                                              
                                                                                                                                
     MOVED HB 64 OUT OF COMMITTEE                                                                                               
                                                                                                                                
SENATE BILL NO. 52                                                                                                              
"An Act  relating to the  reorganization of certain  functions of                                                               
the  division of  banking, securities,  and corporations  and the                                                               
division  of   occupational  licensing   in  the   Department  of                                                               
Commerce, Community, and Economic  Development; and providing for                                                               
an effective date."                                                                                                             
                                                                                                                                
     MOVED CSSB 52(L&C) OUT OF COMMITTEE                                                                                        
                                                                                                                                
SENATE BILL NO. 100                                                                                                             
"An  Act  relating  to  enhanced  911  surcharges  imposed  by  a                                                               
municipality."                                                                                                                  
                                                                                                                                
     HEARD AND HELD                                                                                                             
                                                                                                                                
CS FOR HOUSE BILL NO. 47(FIN)                                                                                                   
"An Act extending the termination  date of the Board of Certified                                                               
Real  Estate Appraisers;  and relating  to  the requirements  for                                                               
membership on the Board of Certified Real Estate Appraisers."                                                                   
                                                                                                                                
     MOVED CSHB 47(FIN) OUT OF COMMITTEE                                                                                        
                                                                                                                                
SENATE BILL NO. 93                                                                                                              
"An Act relating to commercial fishing permit and vessel license                                                                
fees; and providing for an effective date."                                                                                     
                                                                                                                                
     HEARD AND HELD                                                                                                             
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB  64                                                                                                                  
SHORT TITLE: EXTEND BOARD OF PUBLIC ACCOUNTANCY                                                                                 
SPONSOR(s): REPRESENTATIVE(s) HAWKER                                                                                            
                                                                                                                                
01/12/05       (H)       READ THE FIRST TIME - REFERRALS                                                                        

01/12/05 (H) L&C, FIN

01/21/05 (H) L&C AT 3:15 PM CAPITOL 17

01/21/05 (H) Moved Out of Committee

01/21/05 (H) MINUTE(L&C)

01/24/05 (H) L&C RPT 5DP

01/24/05 (H) DP: LYNN, KOTT, LEDOUX, GUTTENBERG, ANDERSON 02/01/05 (H) FIN AT 1:30 PM HOUSE FINANCE 519 02/01/05 (H) Moved Out of Committee 02/01/05 (H) MINUTE(FIN) 02/02/05 (H) FIN RPT 6DP 2NR 02/02/05 (H) DP: HAWKER, WEYHRAUCH, KELLY, FOSTER, STOLTZE, MEYER; 02/02/05 (H) NR: MOSES, CHENAULT 02/02/05 (H) TRANSMITTED TO (S) 02/02/05 (H) VERSION: HB 64 02/04/05 (S) READ THE FIRST TIME - REFERRALS 02/04/05 (S) L&C, FIN 02/15/05 (S) L&C AT 1:30 PM BELTZ 211 BILL: SB 52 SHORT TITLE: OCCUPATIONS/CORPORATIONS/BANKS/SECURITIES SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR

01/12/05 (S) READ THE FIRST TIME - REFERRALS

01/12/05 (S) L&C 02/01/05 (S) L&C AT 1:30 PM BELTZ 211 02/01/05 (S) -- Meeting Rescheduled to 02/08/05 -- 02/08/05 (S) L&C AT 1:30 PM BELTZ 211 02/08/05 (S) Moved CSSB 52(L&C) Out of Committee 02/08/05 (S) MINUTE(L&C) 02/15/05 (S) L&C AT 1:30 PM BELTZ 211 BILL: SB 100 SHORT TITLE: ENHANCED 911 SURCHARGES SPONSOR(s): SENATOR(s) BUNDE 02/10/05 (S) READ THE FIRST TIME - REFERRALS 02/10/05 (S) L&C, CRA 02/15/05 (S) L&C AT 1:30 PM BELTZ 211 BILL: HB 47 SHORT TITLE: EXTEND BOARD OF REAL ESTATE APPRAISERS SPONSOR(s): REPRESENTATIVE(s) SAMUELS

01/10/05 (H) PREFILE RELEASED 12/30/04

01/10/05 (H) READ THE FIRST TIME - REFERRALS

01/10/05 (H) L&C, FIN

01/21/05 (H) L&C AT 3:15 PM CAPITOL 17

01/21/05 (H) Moved Out of Committee

01/21/05 (H) MINUTE(L&C)

01/24/05 (H) L&C RPT 4DP 1NR

01/24/05 (H) DP: LYNN, KOTT, LEDOUX, ANDERSON;

01/24/05 (H) NR: GUTTENBERG 02/01/05 (H) FIN AT 1:30 PM HOUSE FINANCE 519 02/01/05 (H) Moved CSHB 47(FIN) Out of Committee 02/01/05 (H) MINUTE(FIN) 02/02/05 (H) FIN RPT CS(FIN) NT 5DP 3NR 02/02/05 (H) DP: HAWKER, KELLY, FOSTER, STOLTZE, MEYER; 02/02/05 (H) NR: MOSES, CROFT, CHENAULT 02/02/05 (H) TRANSMITTED TO (S) 02/02/05 (H) VERSION: CSHB 47(FIN) 02/04/05 (S) READ THE FIRST TIME - REFERRALS 02/04/05 (S) L&C, FIN 02/15/05 (S) L&C AT 1:30 PM BELTZ 211 BILL: SB 93 SHORT TITLE: FISHING PERMIT AND VESSEL LICENSE FEES SPONSOR(s): SENATOR(s) STEVENS B 02/04/05 (S) READ THE FIRST TIME - REFERRALS 02/04/05 (S) L&C, FIN 02/15/05 (S) L&C AT 1:30 PM BELTZ 211 WITNESS REGISTER Representative Hawker Alaska State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Sponsor of SB 64. Ms. Pat Davidson, Auditor Division of Legislative Audit PO Box 113300 Juneau AK 99811 POSITION STATEMENT: Commented on HB 64 and HB 47. Ms. Lanaya Snyder Staff to Representative Samuels Alaska State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Commented on HB 47 for the sponsor. Frank Hohman, Commissioner Commercial Fisheries Entry Commission (CFEC) Department of Fish & Game PO Box 25526 Juneau, AK 99802-5226 POSITION STATEMENT: Supported SB 93. Mr. Al Burch Alaska Draggers Association Kodiak AK POSITION STATEMENT: Supported SB 93. Ms. Lauren Wickersham Staff to Senator Bunde Alaska State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Commented on SB 100. Craig Goodrich, Deputy Chief Anchorage Police Department Anchorage AK POSITION STATEMENT: Supported SB 100. Chief Walt Monegan Anchorage Police Department Anchorage AK POSITION STATEMENT: Supported SB 100. Ms. Erin Kalwara Public Safety Assistance Coordinator Juneau Police Department Juneau AK POSITION STATEMENT: Supported SB 100. Mr. Tim Rogers Alaska Municipal League (AMA) POSITION STATEMENT: Supported SB 100. Mr. David Tyler, President Alaska Fire Chiefs Association Fairbanks AK POSITION STATEMENT: Supported SB 100. Mr. Paul Harris, Director Fairbanks Police Department Fairbanks AK POSITION STATEMENT: Supported SB 100. Mr. Chuck Kopp, Chief of Police Kenai Peninsula Borough 144 North Binkley Street Soldotna, AK 99669 POSITION STATEMENT: Supported SB 100. Mr. Jim Rowe, Executive Director Alaska Telephone Association Anchorage AK POSITION STATEMENT: Supported SB 100. Ms. Linda Freed, Manager City of Kodiak AK POSITION STATEMENT: Supported SB 100. ACTION NARRATIVE CHAIR CON BUNDE called the Senate Labor and Commerce Standing Committee meeting to order at 1:37:32 PM. Senator Ellis and Chair Bunde were present. He said that Senator Seekins would arrive shortly. Senators Ben Stevens and Davis were excused. HB 64-EXTEND BOARD OF PUBLIC ACCOUNTANCY CHAIR BUNDE announced HB 64 to be up for consideration. REPRESENTATIVE HAWKER, sponsor of HB 64, said this is a housekeeping bill and extends the board to June 30, 2009 in accordance with the Auditor's recommendations. 1:38:54 PM The audit identified one issue for attention. The process of complying with changing national standards for testing resulted in only one place for testing public accountants in the state. The board is proactively dealing with that situation and has established a testing facility in Fairbanks and is getting one in Juneau. 1:39:27 PM CHAIR BUNDE noted the delay in addressing complaints and if there was a solution other than hiring more people. REPRESENTATIVE HAWKER said that Steve Tarola, Chairman of the Board of Accountancy, said there may be some remediation, but no complaints had been referred to the ombudsman. 1:40:39 PM MS. PAT DAVIDSON, Division of Legislative Audit, said she is required to be a CPA and as such is not independent with respect to this board. She is required by statute to perform the audit and recommended a four-year extension and identified a problem in going to the national computerized exam, which went from being available twice a year to four times per year - but it went from being in Juneau, Anchorage and Fairbanks down to being in just Anchorage. However, the Board is working on establishing additional testing sites. 1:41:48 PM MS. DAVIDSON said there were problems in terms of getting investigations done and taking action. Recommendations were made to the department, which they have agreed with. Subsequent reviews will look at how well recommendations are being implemented. CHAIR BUNDE held the bill until a quorum was present. 1:42:54 PM Recess 1:44:01 PM CSHB 47(FIN)-EXTEND BOARD OF REAL ESTATE APPRAISERS CHAIR CON BUNDE announced CSHB 47(FIN) to be up for consideration. MS. LANAYA SNYDER, staff to Representative Samuels, sponsor of HB 47, explained this bill is also the result of a legislative audit that recommends extending the Board of Certified Real Estate Appraisers. She said the bill was amended to make language more consistent throughout the statute by changing "licensed" to "certified". MS. PAT DAVIDSON, Division of Legislative Audit, said the use of certified real estate appraisers will be a continuing requirement for Alaska's financial institutions to qualify for federal deposit insurance and to participate in selling mortgage loans to federal government sponsored enterprises, such as Fannie Mae and Freddie Mac. Her division recommends extending the termination date of the board and had no further recommendations for operational improvements. CHAIR BUNDE noted that the board is breaking even. It doesn't need to raise its fees and it is not costing the state money. He set the bill aside for a quorum. 1:47:05 PM SB 93-FISHING PERMIT AND VESSEL LICENSE FEES CHAIR CON BUNDE announced SB 93 to be up for consideration. CHERYL SUTTON, staff to Senator Ben Stevens, sponsor of SB 93, explained that the Commercial Fisheries Entry Commission (CFEC) receives no general funds, has been on a downward trend in revenue and will continue like that under the current fee structure. Some of the contributing factors are the Carlson v. Alaska case, the decline in value of certain fisheries and the consolidation of various fisheries. SB 93 would bring the state into compliance with rulings in Carlson v. State of Alaska, a class action brought against the state by non-resident fishermen who claimed that the fee structure was not lawful. The state had charged a 3 to 1 fee differential for non-residents. The court agreed that the fees could not be established in this manner and issued a mandated formula that is now calculated by the Office of Management and Budget (OMB). CHAIR BUNDE asked for her indulgence to step aside for a moment. SENATOR SEEKINS arrived at 1:49:57 PM. HB 47-EXTEND BOARD OF REAL ESTATE APPRAISERS CHAIR CON BUNDE announced HB 47 to be back up for consideration. SENATOR RALPH SEEKINS moved HB 47 from committee with individual recommendations and attached fiscal note. There were no objections and it was so ordered. HB 64-EXTEND BOARD OF PUBLIC ACCOUNTANCY SENATOR SEEKINS moved HB 64 from committee with individual recommendations and attached fiscal note. There were no objections and it was so ordered. 1:50:02 PM SB 52-OCCUPATIONS/CORPORATIONS/BANKS/SECURITIES CHAIR CON BUNDE announced SB 52 to be up for consideration. SENATOR RALPH SEEKINS moved to rescind the committee's previous action in the meeting on 2/8/05 in adopting Amendment 1 to the \F version CSSB 52(L&C). There were no objections and it was so ordered. SENATOR SEEKINS moved to adopt CSSB 52(L&C), version \F. There were no objections and it was so ordered. SENATOR SEEKINS moved to pass CSSB 52(L&C) from committee with individual recommendations and attached fiscal note. There were no objections and it was so ordered. SB 93-FISHING PERMIT AND VESSEL LICENSE FEES MS. SUTTON resumed her testimony on SB 93. The major component of SB 93 is removal of the $300 cap for annual permit renewal currently in statute. It is an artificial cap because the statute states that the base fee must reasonably reflect the different rates of economic return for different fisheries. The cap results in fisheries with a very high economic return being charged fees that are disproportionately low. She explained that the CFEC would develop fees through a public hearing process. Individuals who qualify for a poverty fee would still be required to pay the full non-resident fee differential. 1:54:28 PM She said that vessel license fees are also addressed in this bill. A modest modification is proposed to the six vessel length categories and the fees are raised by $15, $30, $45, $60, $75 and $90 respectively. She pointed out that the fee structure had not been amended since 1995. 1:55:04 PM MR. FRANK HOHMAN, Commissioner, CFEC, agreed with Ms. Sutton's testimony. The Carlson case is a factor in CFEC's decline in revenues and lower values of fishery permits along with consolidation of fishing fleets in federal and state waters lowering the values of fishery permits upon which the fees are based. There is a reduction in the number of permits that are purchased and the non-transferable permits, which are held until the permit holder dies are retired. He estimated that in FY'06 the commission would not be able to cover its budget by generating revenues alone. The new fee structure will help for a few more years. 1:57:15 PM The $300 cap for lesser value fisheries might have only a modest increase, but higher value fisheries will fall into position on the fee schedule. The formula is calculated as .04% of the value of the permit, which won't be held down artificially. 1:58:12 PM CHAIR BUNDE asked if the non-resident who qualified for the poverty fee would still pay the non-resident differential, $115 this year. 1:58:51 PM MR. HOHMAN replied that is correct, but it applies to only 20 or so people. A resident also can claim a poverty fee, which is half of the base fee, but his taxes have already paid for the differential. 2:00:04 PM CHAIR BUNDE mused that it seemed a contradiction of terms to have a non-resident come to Alaska to fish, but then claim poverty. 2:00:45 PM MR. AL BURCH, Alaska Draggers Association, Kodiak, supported SB 93. His problem was with the proposed methodology for implementing it. He represents 45 trawlers in the Gulf that also do halibut long lining. As trawlers, their fees would go from $300 to $3,975. As long liners, they would go from $300 up to $1,500. His little trawlers that might gross $200,000 per year are being lumped in with the super trawlers in the Bering Sea that might do over $30 million per year. The fee structure is not equitable as it is now; however he is not adverse to a reasonable fee increase. CHAIR BUNDE said he would hold the bill over for Senator Ben Stevens' insights. 2:03:41 PM MR. HOHMAN commented on the issue of small boats that get caught up with large boats. If the bill passed with the fee cap removed, CFEC regulation would establish fee classes through a public hearing process. If classes were not proper for small boats, he would be happy to make an amendment. It was never an issue with a $300 cap, which is small enough to not matter. CHAIR BUNDE said the bill would be held. SB 100-ENHANCED 911 SURCHARGES CHAIR BUNDE announced SB 100 to be up for consideration. He asked if anyone objected to adopting CSSB 100(L&C), version Cook 2/11/05\Y. There were no objections. CHAIR BUNDE explained that there have been instances in Anchorage where life threatening and emergency situations could have been addressed in a timely fashion with a 911 call. The problem is increasing and local municipalities are required to provide this service, but at this point don't have an option to pay for it. SB 100 increases their ability to pay for the service by charging $2. It could be surmounted by a vote of the people in the effected area. 2:07:40 PM MS. LAUREN WICKERSHAM, staff to Senator Bunde, explained where the changes appear in the bill. The billing should be the same for wireless and wire line companies. 2:10:14 PM MR. GRAIG GOODRICH, Deputy Chief, Anchorage Police Department, supported passing SB 100 this year. He related that 50% of today's calls come through cell phones, but people are not often cognizant of their surroundings when placing an emergency call. When it's on a land line, the police can track it, but that is not the case with cell phones. The bill talks about all the surcharges going to the call-taking center and he suggested language saying that at least a portion of those funds go to the dispatch centers. In Anchorage the dispatch center is separate from a law enforcement or call-taking center. That is also the case in the Kenai Peninsula and other areas around the state, as well. 2:13:23 PM CHIEF WALT MONEGAN, Anchorage Police Department, supported SB 100 because it provides the flexibility for local government to justify realistic surcharge rates to maintain and operate 911 centers. Anchorage currently has a 50-cent surcharge. However, out of that 50-cents, 21-cents pays for addressing line fees for every one of the customers they serve for 911, about 316,000 lines. The department needs more money to actually provide a service. He said it receives about 250,000 calls per year and 58% of them are 911 calls. About half of those are coming from cells phones and the department does not have the ability to know the location on those. This amounts to about $800,000 a year for data base management; add on about $260,000 per year for infrastructure costs and the department has $3 million more a year for additional operating costs. That all adds up to about $4 million in enhanced operations and maintenance costs. The 50 cents generates about $2 million. The rest of the cost is borne by taxpayers. 2:17:47 PM CHAIR BUNDE asked if raising the cap to $2 will allow enough flexibility to address the costs of enhanced 911 for a couple of years. CHIEF MONEGAN replied that is correct. He anticipated raising it by $1 at first. 2:19:19 PM MS. ERIN KALWARA, Public Safety Assistance Coordinator, Juneau Police Department, said she administers the 911 program and supports the changes. She doubted that $2 would hold the department for more than five years. She had no idea what technologies will develop in the future and thought a $3 fee would be needed. 2:21:12 PM MR. TIM ROGERS, Alaska Municipal League, supported SB 100. The enhanced system would allow the call takers to see the address of the originating caller. Passage of the increase in the surcharge is needed to help the continual upgrade of the 911 system and help in the development of address databases to avoid untimely response delays. Also, several of the funds for upgrading 911 systems have disappeared in the last couple of years. MR. ROGERS suggested a couple of amendments. Existing statutes have a differential rate for cities with a population under 100,000 and maintaining the differential will allow smaller communities to charge in excess of $2. He also would prefer that the election provision on page 2, lines 8-9, be eliminated for two reasons. One, if the authorized surcharge change is proposed, municipalities don't anticipate the additional authority needs in the foreseeable future and secondly, and probably more important, is it would set the possible precedent for elections on user fee increases. That is of concern to us. It may also be a poor precedent for a future state fee increase, as well, and we think it's best to avoid that if at all possible. 2:25:18 PM MR. DAVID TYLER, supported SB 100. But the $2 limit would impact Fairbanks, because it won't last long. Their local public process allows them to govern themselves when setting fees. He also has concerns with the time constraints and costs associated with the voting requirements. 2:26:59 PM MR. PAUL HARRIS, Director, Fairbanks Police Department, supported SB 100, but he wanted other issues to be addressed. He gave the committee an example of how cell phones enhance the 911 system. He also noted that the $2 would barely cover the technology and maintenance since a good amount of the money goes back to the telephone companies to pay for trunk lines. Often people don't change their addresses when they change their phone numbers and the master street address database needs to be updated. On the receiving end of the call, someone who can deal with an emergency experience must be trained to respond properly. He supported a $3 cap as being more realistic. 2:31:07 PM MR. CHUCK KOPP, Kenai Chief of Police, said he also represented the Alaska Chapter of the National Emergency Numbers Association. He saw this bill as an ongoing solution to a growing problem. Public expectation is rising for emergency services such as reduced response time. He thought the $2 cap would give all municipalities more flexibility than they have now. Technology is moving faster than the state department can respond. 2:34:14 PM CHAIR BUNDE asked if he thought the 100,000 population differential would impact Kenai. MR. KOPP replied that there are 50,000 people in the Kenai Borough and it definitely would impact it. 2:35:14 PM MR. JIM ROWE, Executive Director, Alaska Telephone Association (ATA), supported a non-voter-approved cap of $2 - recognizing the individual municipalities could exceed that cap through an election. He was concerned that the surcharge would raise the local phone bills that already have a number of surcharges. SB 100, however, is concise and addresses many needs. It's important to ATA that there is parity between wireless and hard- wired surcharges. 2:38:04 PM MS. LINDA FREED, Manager, City of Kodiak, supported SB 100. Her dispatch system is budgeted this year at about $600,000 and about $50,000 will come in from the enhanced 911 surcharge. Right now the gap is being made up from their general fund. She supported the increased cap, but also strongly believed in local control and local option and encouraged the committee to consider that a little more strongly in the bill. Kodiak has a strong public process and would like to see an expansion of the use of the funds - lines 18 and 19. That has been interpreted to mean just the 911 portion of their dispatch. Emergency 911 calls are crisis calls that come into the center, but without responders to send out, there is very little use for the technology. She would like to use the funds to help pay for the additional dispatch costs. For example, Kodiak operates a regional dispatch service for the entire road system and provides services for many agencies. This would give the city the ability to raise the charge and provide funds that would operate the entire dispatch system, which is not only city, fire and police, but public works crews, the Coast Guard and State Troopers. Right now the surcharge brings in less than 10% of its annual operating cost, not including capital equipment, replacement costs for E911 and the dispatch center. 2:41:57 PM CHAIR BUNDE thanked her for her compromise and said he would hold the bill for further work. He adjourned the meeting at 2:42:41 PM.

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