04/01/2008 01:30 PM LABOR & COMMERCE
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ALASKA STATE LEGISLATURE SENATE LABOR AND COMMERCE STANDING COMMITTEE April 1, 2008 2:13 p.m. MEMBERS PRESENT Senator Johnny Ellis, Chair Senator Gary Stevens, Vice Chair Senator Bettye Davis Senator Con Bunde MEMBERS ABSENT Senator Lyman Hoffman COMMITTEE CALENDAR SENATE BILL NO. 118 "An Act establishing a fee for disposable plastic bags distributed by retail sellers of goods or services to consumers to carry away or protect goods; and establishing the Alaska litter and marine debris reduction and recycling fund." MOVED CSSB 118(L&C) OUT OF COMMITTEE SENATE BILL NO. 77 "An Act prohibiting use of agency shop fees for political contributions or expenditures." FAILED TO MOVE SB 77 OUT OF COMMITTEE CS FOR HOUSE BILL NO. 357(L&C) "An Act requiring errors and omissions insurance for real estate licensees; renaming the real estate surety fund as the real estate recovery fund and relating to that fund, and redefining the procedures and criteria used by the Real Estate Commission to make an award from the fund to a person suffering a loss caused by certain misconduct of real estate licensees; requiring a real estate licensee to maintain an office in the state; and providing for an effective date." MOVED CSHB 357(L&C) OUT OF COMMITTEE HOUSE BILL NO. 413 "An Act extending the termination date for the Real Estate Commission; and providing for an effective date." MOVED HB 413 OUT OF COMMITTEE HOUSE BILL NO. 379 "An Act relating to educational requirements for licensure as a certified public accountant." HEARD AND HELD SENATE BILL NO. 295 "An Act relating to the licensing of clinical laboratory science professionals; and providing for an effective date." HEARD AND HELD HOUSE BILL NO. 295 "An Act relating to the filing or recording of documents and records with the Department of Natural Resources, to the inspection and copying of filed and recorded documents, and to the filing of secured transaction records under the Uniform Commercial Code; and providing for an effective date." HEARD AND HELD PREVIOUS COMMITTEE ACTION BILL: SB 118 SHORT TITLE: PLASTIC BAG FEE; ESTABLISH LITTER FUND SPONSOR(s): SENATOR(s) ELTON 03/14/07 (S) READ THE FIRST TIME - REFERRALS 03/14/07 (S) L&C, RES, FIN 04/26/07 (S) L&C AT 1:30 PM BELTZ 211 04/26/07 (S) Heard & Held 04/26/07 (S) MINUTE(L&C) 05/01/07 (S) L&C AT 1:30 PM BELTZ 211 05/01/07 (S) Heard & Held 05/01/07 (S) MINUTE(L&C) 03/27/08 (S) L&C AT 1:30 PM BELTZ 211 03/27/08 (S) Scheduled But Not Heard BILL: SB 77 SHORT TITLE: USING UNION DUES FOR POLITICAL PURPOSES SPONSOR(s): SENATOR(s) BUNDE 02/09/07 (S) READ THE FIRST TIME - REFERRALS 02/09/07 (S) STA 02/12/07 (S) L&C REFERRAL ADDED AFTER STA 02/07/08 (S) STA AT 9:00 AM BELTZ 211 02/07/08 (S) Moved SB 77 Out of Committee 02/07/08 (S) MINUTE(STA) 02/08/08 (S) STA RPT 4DP 02/08/08 (S) DP: MCGUIRE, STEVENS, BUNDE, GREEN 03/25/08 (S) L&C AT 1:30 PM BELTZ 211 03/25/08 (S) Heard & Held 03/25/08 (S) MINUTE(L&C) BILL: HB 357 SHORT TITLE: CLAIMS AGAINST REAL ESTATE LICENSEES SPONSOR(s): LABOR & COMMERCE BY REQUEST 02/06/08 (H) READ THE FIRST TIME - REFERRALS 02/06/08 (H) L&C, FIN 02/11/08 (H) L&C AT 3:00 PM CAPITOL 17 02/11/08 (H) Heard & Held 02/11/08 (H) MINUTE(L&C) 02/22/08 (H) L&C AT 3:00 PM CAPITOL 17 02/22/08 (H) -- MEETING CANCELED -- 03/03/08 (H) L&C AT 3:00 PM CAPITOL 17 03/03/08 (H) Moved CSHB 357(L&C) Out of Committee 03/03/08 (H) MINUTE(L&C) 03/04/08 (H) L&C RPT CS(L&C) 3DP 2NR 2AM 03/04/08 (H) DP: GATTO, RAMRAS, OLSON 03/04/08 (H) NR: BUCH, NEUMAN 03/04/08 (H) AM: GARDNER, LEDOUX 03/11/08 (H) FIN AT 1:30 PM HOUSE FINANCE 519 03/11/08 (H) Scheduled But Not Heard 03/12/08 (H) FIN RPT CS(L&C) 5DP 3NR 03/12/08 (H) DP: HAWKER, CRAWFORD, THOMAS, MEYER, CHENAULT 03/12/08 (H) NR: NELSON, KELLY, STOLTZE 03/12/08 (H) FIN AT 8:30 AM HOUSE FINANCE 519 03/12/08 (H) Scheduled But Not Heard 03/12/08 (H) FIN AT 1:30 PM HOUSE FINANCE 519 03/12/08 (H) Moved Out of Committee 03/12/08 (H) MINUTE(FIN) 03/26/08 (H) TRANSMITTED TO (S) 03/26/08 (H) VERSION: CSHB 357(L&C) 03/27/08 (S) READ THE FIRST TIME - REFERRALS 03/27/08 (S) L&C 03/27/08 (S) L&C AT 1:30 PM BELTZ 211 03/27/08 (S) Heard & Held 03/27/08 (S) MINUTE(L&C) BILL: HB 413 SHORT TITLE: EXTENDING THE REAL ESTATE COMMISSION SPONSOR(s): LABOR & COMMERCE 02/20/08 (H) READ THE FIRST TIME - REFERRALS 02/20/08 (H) L&C, FIN 02/25/08 (H) L&C AT 3:00 PM CAPITOL 17 02/25/08 (H) Moved Out of Committee 02/25/08 (H) MINUTE(L&C) 02/27/08 (H) L&C RPT 5DP 02/27/08 (H) DP: GARDNER, BUCH, NEUMAN, LEDOUX, OLSON 03/03/08 (H) FIN AT 1:30 PM HOUSE FINANCE 519 03/03/08 (H) Moved Out of Committee 03/03/08 (H) MINUTE(FIN) 03/04/08 (H) FIN RPT 3DP 6NR 03/04/08 (H) DP: CRAWFORD, NELSON, MEYER 03/04/08 (H) NR: HAWKER, STOLTZE, JOULE, THOMAS, KELLY, CHENAULT 03/10/08 (H) TRANSMITTED TO (S) 03/10/08 (H) VERSION: HB 413 03/12/08 (S) READ THE FIRST TIME - REFERRALS 03/12/08 (S) L&C, FIN 03/27/08 (S) L&C AT 1:30 PM BELTZ 211 03/27/08 (S) Heard & Held 03/27/08 (S) MINUTE(L&C) BILL: HB 379 SHORT TITLE: CPA EDUCATION REQUIREMENTS SPONSOR(s): REPRESENTATIVE(s) HAWKER 02/19/08 (H) READ THE FIRST TIME - REFERRALS 02/19/08 (H) L&C, FIN 02/25/08 (H) L&C AT 3:00 PM CAPITOL 17 02/25/08 (H) Moved Out of Committee 02/25/08 (H) MINUTE(L&C) 02/27/08 (H) L&C RPT 6DP 02/27/08 (H) DP: GARDNER, LEDOUX, BUCH, NEUMAN, GATTO, OLSON 03/03/08 (H) FIN REFERRAL WAIVED 03/12/08 (H) TRANSMITTED TO (S) 03/12/08 (H) VERSION: HB 379 03/14/08 (S) READ THE FIRST TIME - REFERRALS 03/14/08 (S) L&C 04/01/08 (S) L&C AT 1:30 PM BELTZ 211 BILL: SB 295 SHORT TITLE: CLINICAL LABORATORY SCIENCE PROFESSIONALS SPONSOR(s): HEALTH, EDUCATION & SOCIAL SERVICES 02/27/08 (S) READ THE FIRST TIME - REFERRALS 02/27/08 (S) L&C, FIN 04/01/08 (S) L&C AT 1:30 PM BELTZ 211 BILL: HB 295 SHORT TITLE: RECORDED OR FILED DOCUMENTS SPONSOR(s): REPRESENTATIVE(s) LYNN 01/04/08 (H) PREFILE RELEASED 1/4/08
01/15/08 (H) READ THE FIRST TIME - REFERRALS
01/15/08 (H) L&C, RES 02/15/08 (H) L&C AT 3:00 PM CAPITOL 17 02/15/08 (H) Moved Out of Committee 02/15/08 (H) MINUTE(L&C) 02/19/08 (H) L&C RPT 4DP 02/19/08 (H) DP: NEUMAN, BUCH, GARDNER, OLSON 02/27/08 (H) RES REFERRAL WAIVED 03/17/08 (H) TRANSMITTED TO (S) 03/17/08 (H) VERSION: HB 295 03/18/08 (S) READ THE FIRST TIME - REFERRALS 03/18/08 (S) L&C 04/01/08 (S) L&C AT 1:30 PM BELTZ 211 WITNESS REGISTER SENATOR ELTON Alaska State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Sponsor of SB 118. ELEANOR WOLFE Staff to Representative Kurt Alaska State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Commented on HB 357. REPRESENTATIVE MIKE HAWKER Alaska State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Sponsor of HB 379. MAX MERTZ, Chair Board of Accountancy Anchorage, AK POSITION STATEMENT: Supported HB 379. DON BURRELL Staff to Senator Davis Alaska State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Commented on SB 295 for the sponsor. JENNIFER STRICKLER, Licensing Chief Division of Corporations, Businesses and Professional Licensing, Department of Commerce, Community & Economic Development Juneau, AK POSITION STATEMENT: Didn't support SB 295 as written. NANCY MANLEY Staff to Representative Lynn Alaska State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Sponsor or HB 295. VICKY BACCHUS State Recorder Department of Natural Resources (DNR) Anchorage, AK POSITION STATEMENT: Supported HB 295. ACTION NARRATIVE CHAIR JOHNNY ELLIS called the Senate Labor and Commerce Standing Committee meeting to order at 2:13:14 PM. Present at the call to order were Senators Davis, Stevens, and Ellis. SB 118-PLASTIC BAG FEE; ESTABLISH LITTER FUND 2:14:03 PM CHAIR ELLIS announced SB 118 to be up for consideration. SENATOR ELTON, sponsor of SB 118, explained that SB 118 employs the notion that if you can tax behavior, you can change it. This bill was not introduced to raise revenues, but to change behavior by establishing a 15 cent tax on plastic bags. He also supported the CS that phases the tax in at a nickel a year over three years. 2:14:27 PM SENATOR BUNDE joined the committee. SENATOR ELTON said this was adopted from an idea in Ireland where a 20 cent tax cut use of plastic bags by about 90 percent. CHAIR ELLIS asked if his intent was to just keep the conversation going since this bill would have a long way to go to get into law. SENATOR ELTON replied yes; part of it is initiating the discussion. He has received 617 signatures, a lot of emails, 37 letters and phone calls in support of SB 118. He has received four letters, two from the American Chemistry Council, and four POMs opposing it. SENATOR STEVENS moved to adopt CSSB 118(L&C), version M. There were no objections and it was so ordered. SENATOR STEVENS asked if using paper bags is so much better than plastic. SENATOR ELTON answered yes, but every carrying device has its down side. Plastic doesn't biodegrade over time and it creates a huge problem especially in the marine environment where it causes considerable harm to marine mammals and fish. SENATOR BUNDE asked if biodegradable plastic bags would be covered. SENATOR ELTON answered no. Section 1 on page 2 of the CS notes exceptions and includes biodegradable types of bags. He mentioned that some rural villages have already banned plastic bags. SENATOR BUNDE said his concern is that some people can afford to be environmentally conscious and he asked how this affects lower income communities. 2:21:04 PM SENATOR ELTON answered that many communities pick up dog waste now; it just takes time. Fred Meyer is giving a refund to customers for bringing their own bags. 2:22:04 PM SENATOR STEVENS moved to report CSSB 118(L&C) version M from committee with individual recommendations and attached fiscal note(s). There were no objections and it was so ordered. SB 77-USING UNION DUES FOR POLITICAL PURPOSES 2:23:47 PM CHAIR ELLIS announced consideration of SB 77. SENATOR BUNDE, sponsor of SB 77, explained the purpose of the bill is prohibiting unauthorized use of agency fees (union dues) for political reasons. An agency fee is a fee paid to an organization by a non-union member. This bill would require that the employee would have to "opt in" or choose affirmatively to have his or her dues used for the specific purposes. Currently, if the member disagrees with an activity, he can go through a fairly complicated procedure to get reimbursed for that portion of his agency fee that was used for the political activity. SENATOR BUNDE moved to report SB 77 from committee with individual recommendations and attached fiscal note(s). CHAIR ELLIS objected and asked if a public employee was available to testify. SENATOR BUNDE replied that he was referring to a concern that this was going to be a yearly opt-in procedure, but it's only once at the beginning of a person's employment. SENATOR STEVENS said it seems that it is an issue of fairness and one should be able to choose how one's money is used. A roll call vote was taken. Senators Bunde and Stevens voted yea; Senators Davis and Ellis voted nay; so SB 77 failed to move from committee. CSHB 357(L&C)-CLAIMS AGAINST REAL ESTATE LICENSEES 2:27:02 PM CHAIR ELLIS announced CSHB 357(L&C) to be up for consideration. SENATOR BUNDE said he heard from a small real estate business operator that he was quoted as much as $700 for E&O coverage and previous testimony from the sponsor said it would be only a couple of hundred dollars. ELEANOR WOLFE, staff to Representative Kurt Olson and the House Labor and Commerce Committee, explained that individuals who have been quoted individually have run into very high rates. That is why this would become a small group and the existing brokers who have insurance could go with this organization if they choose to do so. The approximately 40 percent that aren't covered now would be able to be covered at $100,000 per year for $200. Most brokers are carrying over $1 million and a whole bunch of extras that aren't included in this policy. 2:29:15 PM SENATOR BUNDE moved to report CSHB 357(L&C) from committee with individual recommendations and attached fiscal note(s). There were no objections and it was so ordered. HB 413-EXTENDING THE REAL ESTATE COMMISSION 2:29:45 PM CHAIR ELLIS announced HB 413 to be up for consideration. He said it comports with recommendations from the Legislative Audit division. SENATOR STEVENS moved to report HB 413 from committee with individual recommendations and attached fiscal note(s). There were no objections and it was so ordered. HB 379-CPA EDUCATION REQUIREMENTS 2:30:23 PM CHAIR ELLIS announced HB 379 to be up for consideration. REPRESENTATIVE MIKE HAWKER, sponsor of HB 379 explained that this measure is really a piece of ministerial legislation. In 2006 the legislature passed a fairly substantial updating of Alaska framework for licensing of certified public accountants st (CPA). The state is moving slowing into the 21 Century and being in conformance with a consistent best practices approach across the nation for the licensing of certified public accountants. One of the adopted provisions was a change in the education requirements to receive a CPA certificate. Prior to the adoption of the changes two years ago, a person could receive a CPA certificate if they passed the examination and met certain experience requirements, but at issue are the scholastic requirements. Prior to passage of the bills, the state had two acceptable methods to satisfy the education requirements. One was that an individual had an accounting degree and subsequently spent two years working under appropriate conditions supervised as an accountant. Alternatively the state would accept any degree, such as an MBA or Finance, from someone who had worked for three years and had an additional year of experience substituting for the specific accounting degree. That bill eliminated the three-year-of-any-degree provision and said CPA's really should have an accounting degree - without a doubt an excellent practice. The new educations requirements took effect on January 1, 2008; however they didn't take into consideration the number of accountants who had graduated with the other experience requirement prior to that date and were working on a three-year experience program under supervision. Those folks are denied the ability to receive a CPA certificate without going back and getting an accounting degree. This measure grandfathers them in and allows them to continue their three-year experience program without having a specific accounting degree. This issue was brought to him by the Alaska State Board of Accountancy. 2:34:44 PM MAX MERTZ, Chair, Board of Accountancy, supported HB 379. It is very timely as the board is in the process of promulgating regulations. CHAIR ELLIS said he was committed to holding HB 379 for a second hearing. SB 295-CLINICAL LABORATORY SCIENCE PROFESSIONALS 2:37:21 PM CHAIR ELLIS announced SB 295 to be up for consideration. DON BURRELL, staff to Senator Davis, sponsor of SB 295, read the sponsor statement. He explained that this measure establishes a voluntary advisory board of clinical laboratory science professionals to assist the Department of Commerce, Community & Economic Development in identifying acceptable credentialing agencies and determine which laboratory tests would be included in the waived category. MR. BURRELL said the advisory board would review the FDA's list of waive tests and make recommendations to the department concerning which tests should be in the waive category. He explained: Clinical laboratory science professionals and radiologic technologists are two of the health care professionals not licensed by the state. According to the Institute of Medicine 70 percent of all medical decisions are based on diagnostic testing. If the individuals collecting the samples and performing the diagnostic testing are not qualified, the information used by the physician to diagnose or treat their patients may be incorrect. Clinical laboratory science professionals and radiologic technologists perform the majority of the diagnostic testing. Certification of the clinical laboratory professionals ensures that qualified professionals are performing diagnostic testing. By licensing clinical laboratory science professionals and requiring certification and participation in certification maintenance programs for licensure and renewal, we can ensure the qualified professionals are performing the diagnostic testing while controlling the licensing costs. SENATOR STEVENS asked how many of these folks are in the state. MR. BURRELL answered approximately 400. SENATOR BUNDE asked if this focuses on people who administer the test, not those who diagnose possible illness from the results of the test. MR. BURRELL answered yes. 2:40:45 PM JENNIFER STRICKLER, Licensing Chief, Division of Corporations, Businesses and Professional Licensing, Department of Commerce, Community & Economic Development, didn't support SB 295 as written. Although it is up to the legislature to decide whether this new industry should be licensed or not, she had serious concerns. First it creates a new Chapter 30 under Title 8 Professions and Occupations, but it doesn't include Section 08.30 under Section 08.01, which is the Centralized Licensing Act. This Act contains the statutes that give her department the administrative duties and powers to do things like issue and sanction licenses, establish fees, adopt regulations, conduct investigations and hold hearings. Second, SB 295 establishes a five-member volunteer advisory board of clinical laboratory science professionals appointed by the governor and therefore would be subject to confirmation by the legislature under AS 39.05, but it doesn't provide the board per diem and transportation expenses as directed in Section (1)(d) on page 2, lines 6-8. This might not be legal. MS. STRICKLER said the volunteer advisory board is not the subject of a sunset review process under AS 08.03 and therefore, while the process to establish the board is established like any other regulatory board, she didn't know if this board was intended to exist continuously without legislative oversight. 2:43:10 PM MS. STRICKLER said under the duties of the board in Section 08.30.030 on page 2, lines 14-16, the board's responsibilities are limited to only two items. Number one would be to identify credentialing agencies or organizations and, from her information, there are three known organizations affiliated with this group. Her second concern was to identify what laboratory tests should be defined as waive tests for this industry, she would need a board to assist with that because she has no idea. Her fifth item concerned Section 08.30.080, on page 4, that specified the duration of a license was for three years or until it is relinquished. However, she said, all other licenses within the division are issued for two years on a biennium cycle. If this bill were to be subject to the Centralized Licensing Act, it would go to a two-year duration. If it's not subject to the Act and stays on a three-year cycle, it would be the only program with a three-year license. She also felt the word "relinquished" should be changed to "lapsed" just for standardization of licensing terms. Most people let their licensing lapse and choose not to renew. 2:44:44 PM Last, she mentioned that Section 08.30.090, Article 3, on page 4, line 27, provides the grounds for denial or disciplinary sanctions, but it doesn't give the department the authority to investigate or to provide due process under the Administrative Procedures Act of AS 44.62, which would normally be provided if the chapter was subject to Section 08.01. MR. BURRELL added that SB 295 has two fiscal notes, one from the Department Of Administration and one from the Department of Commerce, Community & Economic Development and they indicated one part time staff would be needed to oversee the 400 members of this particular profession. 2:49:11 PM SENATOR BUNDE said based on the administration's testimony, this bill isn't ready for prime time yet. SENATOR STEVENS asked Mr. Burrell if per diem was provided. MR. BURRELL answered no. CHAIR ELLIS said SB 295 would be held for further work. HB 295-RECORDED OR FILED DOCUMENTS 2:50:53 PM CHAIR ELLIS announced HB 295 to be up for consideration. NANCY MANLEY, staff to Representative Lynn, sponsor or HB 295, related that advancing technology improvements in the Recorder's Office are reaching the point to allow instant recording and HB 295 cleans up the statutes to allow this to happen. It amends three areas in statute to enable the return of original documents to the presenter at the time of recording, to ensure that all required recording information is located on the document, to delete references to film or scanning the daily recordings, to remove references to court authority over the Recorder's Office, and updates UCC forms referenced in statute to conform with national standards. She said this bill also requires that documents presented for recording contain the name of the recording district in which the document is to be recorded. Currently this information may be provided verbally or in a cover letter. MS. MANLEY said her office was asked to introduce this bill for the Recorder's Office and that office would answer questions. 2:52:26 PM VICKY BACCHUS, State Recorder, Department of Natural Resources (DNR), supported HB 295. She said it has cleanup language for the Recorder's Office and gets the state ready for electronic recording. To do that she needs to be able to return a document immediately to the presenter after it has been recorded. Right now the statute requires her to return the documents to the person identified within the document. 2:53:38 PM MS. BACCHUS said she also wanted all required recording information on the document itself. Right now the only piece of recording information that is not required to be on the document is the identification of the recording district and this information can be given verbally or in a cover letter. When it is given to her that way, she has to retain it and save it so if the question ever comes up on what district it was supposed to be recorded in, that record can be accessed. So, HB 295 requires the recording district information on the document itself. She said HB 295 also cleans up a couple of areas in AS 40.25 that require her to provide facilities for copying the public records by removing reference to being under the direction of the Court System, which the Recorder's Office hasn't been since 1977. She explained that the requirement to provide facilities for the filming and copying of the public record was put in place back in the 70s or early 80s when the office had extreme backlogs in indexing and filming of the daily work. Title companies got together and determined that an independent company would come in and film the daily work to provide to them. Now in the electronic age, the Recorder's Office gives electronic downloads to all of the title companies on a daily basis; so that's not an issue any more. 2:55:13 PM MS. BACCHUS said one of the major updates in HB 295 gives her the ability to reject UCC finance statements that are submitted on the old forms that are currently referenced in the statutes and include a space for social security numbers. The people using those forms feel compelled to fill in all the blanks, so first they put in their social security numbers. Right now she is not in a position to reject them, because it is in statute; 11 AAC 06.050 already provides for DNR to designate a UCC form which is already on the UCC website. It is the current national form that does not include a space for a social security number. She offered to answer questions. 2:56:08 PM SENATOR BUNDE asked if this legislation would address the Recorder's backlog or has it been addressed. MS. BACCHUS replied that they haven't had backlogs for a long time. Recorder's Offices in more remote locations like Fairbanks or Juneau scan documents and provide CDs to their customers daily. She said her office uses a file transfer protocol (FTP), which is a totally electronic download, to get daily information to her customers. 2:57:10 PM CHAIR ELLIS asked how Alaska's Recorder's Offices compare to others in other states and if this bill would bring her up to par with best practices in other states. MS. BACCHUS answered that the State of Alaska has a lot better recording system than most other states. Others states usually handle recording at the county level. They don't have the ability to have a statewide search done from one source. Some states are going to that, but their counties have a conglomeration of different programs and systems. Alaska's recording requirements are at par with other recording jurisdictions and so are its recording fees. She said Alaska belongs to the Public Records Industry Association (PRIA), which sets the standard for recording and all in all Alaska has better access to its documents with its retention and preservation programs. All public records of the state will available for research in digital form within the next three years. CHAIR ELLIS asked about known opposition to the bill. MS. BACCHUS answered she knew of no opposition. CHAIR ELLIS said he would hold HB 295 for further consideration in the near future. There being no further business to come before the committee, he adjourned the meeting at 2:59:29 PM.