Legislature(2015 - 2016)BELTZ 105 (TSBldg)
04/07/2015 01:30 PM Senate LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| Confirmation Hearing | |
| SB76 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | TELECONFERENCED | ||
| += | SB 76 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
SENATE LABOR AND COMMERCE STANDING COMMITTEE
April 7, 2015
1:29 p.m.
MEMBERS PRESENT
Senator Mia Costello, Chair
Senator Cathy Giessel, Vice Chair
Senator Gary Stevens
Senator Johnny Ellis
MEMBERS ABSENT
Senator Kevin Meyer
COMMITTEE CALENDAR
CONFIRMATION HEARING
Department of Labor and Workforce Development
Heidi Drygas, Commissioner
- CONFIRMATION ADVANCED
SENATE BILL NO. 76
"An Act relating to private actions and remedies against real
estate licensees for licensee relationships, disclosures, and
activity before January 1, 2005; and providing for an effective
date."
- MOVED SB 76 OUT OF COMMITTEE
PREVIOUS COMMITTEE ACTION
BILL: SB 76
SHORT TITLE: REAL ESTATE BROKERS; LIABILITY
SPONSOR(s): JUDICIARY
03/18/15 (S) READ THE FIRST TIME - REFERRALS
03/18/15 (S) L&C, JUD
03/31/15 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
03/31/15 (S) Heard & Held
03/31/15 (S) MINUTE(L&C)
WITNESS REGISTER
HEIDI DRYGAS, Commissioner designee
Department of Labor and Workforce Development (DOLWD)
Anchorage, Alaska
POSITION STATEMENT: Testified as commissioner designee for the
Department of Labor and Workforce Development.
GENEVIEVE WOJTUSIK, Staff
Senator McGuire
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Provided supporting information for SB 76
on behalf of the sponsor.
JEFFREY PICKETT, retained counsel for the Senate Judiciary
Committee
Anchorage, Alaska
POSITION STATEMENT: Answered questions related to SB 76.
ACTION NARRATIVE
1:29:56 PM
CHAIR MIA COSTELLO called the Senate Labor and Commerce Standing
Committee meeting to order at 1:29 p.m. Present at the call to
order were Senators Ellis, Giessel and Chair Costello.
^Confirmation Hearing
Confirmation Hearing
Commissioner, Department of Labor and Workforce Development
1:30:20 PM
CHAIR COSTELLO announced the first order of business would be a
confirmation hearing for Heidi Drygas as Commissioner of the
Department of Labor and Workforce Development (DOLWD). She noted
that this was the fifth and final hearing on governor
appointments. She asked Commissioner designee Drygas to provide
opening remarks.
1:31:11 PM
HEIDI DRYGAS, Commissioner designee, Department of Labor and
Workforce Development (DOLWD), said she is a lifelong Alaska.
She attended UAF and received a degree in history. She then
attended Willamette University and received a law degree in
2003. She moved to Anchorage in 2004 and worked as an insurance
defense attorney for a year before she was offered a position as
general counsel for the Alaska District Council of Laborers. She
held that position until she was appointed to this position on
December 19, 2014. She said she's enjoying the work and is
impressed with the employees. They are a dedicated group and
it's an honor to lead the department, she said.
1:32:06 PM
SENATOR STEVENS joined the committee.
SENATOR ELLIS asked for an update on the job centers.
COMMISSIONER DRYGAS said DOLWD has been downsizing the number of
job centers over the past several years because the federal
funding sunsets this year. However, the department recognizes
they are an important resource for communities and is working to
partner with regional entities and communities so that job
center services aren't entirely removed from locations. Both the
Eagle River and Muldoon job centers will remain open for FY2016
with reduced staffing; AVTEC will take over the responsibilities
of the job center in Seward; and the City of Barrow will assume
the job center services that the department has previously
provided. The ongoing effort is to ensure that if the department
doesn't offer the job center services, someone in the area does.
1:38:18 PM
SENATOR GIESSEL referenced the minutes from a recent Alaska
Gasline Development Corporation (AGDC) board of directors
meeting and asked what decision points she had considered in
reaching a yes vote on the resolution [to study the cost to
expand the size of the ASAP pipeline].
COMMISSIONER DRYGAS explained that she wanted to ensure that the
resolution reflected the intent of the board regarding whether
or not to support expanding the capacity of the Alaska Stand
Alone Pipeline (ASAP). She said everyone agrees that the
priority is to develop AKLNG, but it's important to have a
viable, economic backup. The timing of the resolution was
important because the technical team that has the expertise to
study the issue might be disbanded. She posited that it was part
of due diligence to study the matter now rather than later time.
SENATOR GIESSEL asked if the board was apprised of the estimated
cost of the study.
COMMISSIONER DRYGAS answered no, but they were told that it
would be more expensive to request the study after the technical
team had disbanded.
SENATOR GIESSEL asked what preparations are being made for the
estimated 10,000-15,000 jobs that would be created by the large
AKLNG pipeline.
1:44:50 PM
COMMISSIONER DRYGAS said the current estimate is that between
8,000 and 9,000 workers will be needed to construct the AKLNG
pipeline and about 1,000 workers to maintain it. The producers
have expressed interest in working with DOLWD on an integrated
labor study looking at whether the state can meet the workforce
needs to build the project. She stressed that having a skilled
and ready workforce is a number one goal of the governor and one
of her primary goals as commissioner.
COMMISSIONER DRYGAS said the new workforce development plan will
draw from previous models and will include input from
stakeholders from industry and labor as well as the Alaska
Workforce Investment Board. The intent is to have a targeted
timeline to identify needs and to put systems in place to meet
those needs. She said the department has hit the ground running
to ensure that the systems are in place to develop a skilled
Alaskan workforce that is ready to meet the needs of industry
when the AKLNG project is built. The situation was different
when the Trans Alaska Pipeline System in that the state didn't
have a trained and ready workforce.
1:49:02 PM
SENATOR GIESSEL highlighted the differences in the state between
the 1970s and now.
COMMISSIONER DRYGAS responded that she was in Alaska because her
father worked on TAPS.
SENATOR GIESSEL asked her thoughts on the confidentiality
agreement concept for an AGDC board member.
COMMISSIONER DRYGAS explained that the administration was
concerned about transparency and ensuring that Alaskans know at
each step what is happening with their resource. That being
said, she was ready to work on and sign a confidentiality
agreement that the administration and AGDC board members agreed
to.
SENATOR GIESSEL asked if she received an explanation of instate
consumption capacity and what would happen to the extra gas if
the small instate line was expanded.
COMMISSIONER DRYGAS acknowledged that there would be challenges
associated with marketing the gas in a meaningful way. She said
the administration and the AGDC board would like to see the
AKLNG line come to fruition, but if that fails this would be a
backup to provide gas to Alaskans and another revenue stream for
years to come.
SENATOR GIESSEL expressed appreciation for the answers and
highlighted the concern that the smaller pipeline is not an
integrated project and has no export component.
1:54:47 PM
SENATOR STEVENS commented on the importance of timing all
training and asked who will train the workforce.
COMMISSIONER DRYGAS replied the department will work with
partners and regional training centers. Apprenticeship programs
will also be increased. The timing of the training will be part
of the workforce development plan and will depend on that
timeline. The multiple systems will work together to meet the
different timeframes.
DOLWD will have collaborative meetings with the regional
training centers to work on career and technical education and
look at program needs. The department, the university and the
Department of Education convened a taskforce to further develop
a career and technical education (CTE) plan to eliminate
duplication and identify critical industries that need more
trained workers. The focus is to enhance the oil and gas
workforce but they'll also look at growing new industries. She
noted that DOLWD is working with the federal government to
submit an American Apprenticeship grant application that could
bring in $2.5 million to $5 million for non-traditional
apprenticeships.
SENATOR STEVENS reiterated the importance of timeliness in
training a workforce and thanked Commissioner Drygas for her
efforts.
SENATOR COSTELLO asked Commissioner Drygas if she saw the AGDC
resolution for the first time on the same day she voted on it.
She noted that Mr. Halford testified to the Senate Resources
Committee that he hadn't seen it before the meeting.
COMMISSIONER DRYGAS said she hadn't seen the resolution before
but had discussed the concept with another board member. She
wasn't surprised to see it but wanted to make sure it was
thoroughly discussed and reflected the intent of the body.
CHAIR COSTELLO quoted Commissioner Drygas' comments during the
3/15/15 AGDC board meeting. "And I think I'd feel comfortable if
we took the time to make sure that if we vote on this, we give a
clear direction to staff in the resolution, not just necessarily
what's on the record." She asked Commissioner Drygas if she
values getting conversations on the record because it seems that
a lot of questions went unanswered.
2:02:26 PM
COMMISSIONER DRYGAS recalled there was discussion during the
meeting about what the board intended the staff to study, but
her feeling was that specific directions for the staff should be
included in the resolution. The ultimate decision was that the
staff had sufficient direction. She didn't recall off-record
conversations which are prohibited under the public meetings
law.
CHAIR COSTELLO advised Commissioner Drygas to think
independently and consider the effect of what the resolution is
communicating. She asked how she can justify spending money on a
secondary plan when there's already a backup on the books that
everybody likes.
COMMISSIONER DRYGAS clarified that there is no current intention
to expand the size of the Alaska Stand Alone Pipeline (ASAP).
The AGDC board is looking to study whether that is a viable
option. That's never been done; it's only been looked at as a
smaller diameter line. She said she doesn't take the cost of the
study lightly but as a board member and Commissioner she has a
fiduciary responsibility to the people of Alaska to look at the
option to see if it's economically feasible. "While we continue
with the study, hopefully AKLNG continues to progress," she
said.
2:11:06 PM
CHAIR COSTELLO expressed concern that the study to expand the
size of ASAP would put the larger pipe at risk. She urged
waiting a year to give AKLNG time to move to the next stage. She
pointed out that Senate Bill 138 was signed into law after 51
hearings and thorough discussion. That project will bring from
15,000 to 20,000 jobs and there's a duty to Alaskans to follow
the law which is laid out very clearly. AKLNG is the star player
but if it doesn't work out, ASAP is the backup.
She expressed appreciation for the questions Commissioner Drygas
asked during the AGDC Board meeting and encouraged her to view
herself as an independent member who can ask the larger
questions such as what are the board actions communicating to
the market.
SENATOR GIESSEL underscored the importance of waiting to see if
the producers and the state, as equal partners, can make this
large project economic. "We don't want to be trying to craft
something now when we don't know what the fail points are for
this smaller backup," she said.
2:15:48 PM
COMMISSIONER DRYGAS replied she appreciates the concerns but she
doesn't believe that there is time to wait to look at the fail
points before looking at the options for the backup plan. She
continued to say:
Alaska needs a new revenue stream and we don't have
the time to wait. I think it is important to continue
both of these projects together, as they have been.
There has been a lot of collaboration and working
together. There's a lot of shared data involved that's
been really helpful and beneficial and ultimately I
think the board and the governor would like to see
these eventually merge into one.
SENATOR GIESSEL pointed out that the two projects have
fundamentally different goals. The ASAP line was for instate use
and not considered for export, whereas the AKLNG has always been
an export line. She cautioned that making a policy change on the
instate line creates a conflict and a problem.
CHAIR COSTELLO added that the AKLNG project has offtake
opportunities for instate gas.
2:18:54 PM
CHAIR COSTELLO found no further comments and read the following:
In accordance with AS 39.05.080 the Senate Labor and
Commerce Committee reviewed the following and
recommends the appointment to be forwarded to a joint
session for consideration.
2:19:06 PM
CHAIR COSTELLO called an at ease to sign the paperwork.
SB 76-REAL ESTATE BROKERS; LIABILITY
2:21:06 PM
CHAIR COSTELLO reconvened the meeting and announced the
consideration of SB 76. "An Act relating to private actions and
remedies against real estate licensees for licensee
relationships, disclosures, and activity before January 1, 2005;
and providing for an effective date." She noted that this was
the second hearing.
2:21:42 PM
GENEVIEVE WOJTUSIK, Staff, Senator McGuire, summarized that SB
76 addresses notification requirements for real estate
transactions before January 1, 2005 when the licensee represents
both the buyer and seller. The original statute did not specify
remedies if a real estate licensee violated its provisions and
had no timeline. In 2002 a lawsuit was brought and it became a
class action suit in 2010. SB 76 broadens the language in [AS
08.88.396(e)] to help with that suit.
During the previous hearing, Senator Giessel asked what the law
said in 1998 regarding dual representation. At that time, AS
08.88.396(c) said: "A person licensed under this chapter may act
as an agent for both the prospective seller and a prospective
buyer of real estate, only after the licensee informs both the
seller and the buyer of the dual agency and receives written
consent to the dual agency from both principals." The statute
did not include a timeline for obtaining the written consent to
the dual representation.
2:24:04 PM
CHAIR COSTELLO recalled previous testimony that prospective
homeowners were making on the spot offers after viewing the
properties. As a result, a situation came up where a buyer felt
he/she made an offer without receiving communication from the
agent about their dual representation.
MS. WOJTUSIK confirmed that two people felt that they were not
informed that the real estate licensee represented both the
buyer and seller. They brought legal action in 2002.
CHAIR COSTELLO asked why the new language on page 1, line 6,
striking the term "for" and inserting "arising out of" is a
clarification.
MS. WOJTUSIK deferred to Mr. Pickett.
2:25:34 PM
JEFFREY PICKETT, retained counsel for the Senate Judiciary
Committee, explained that the term "arising out of" is a more
broadly interpreted term by Alaska courts and would cover both
common law and statutory actions. This would clarify the
legislature's intent in 2003 when it limited damages to actual
damages for violations of the dual agency notice requirement.
CHAIR COSTELLO asked if this change might bring consumer
protection concerns.
MR. PICKETT replied he has heard nothing on the consumer
advocate side that would indicate concern with this change. He
explained that the change is focused on the damages a consumer
is entitled to if the dual representation was not properly
disclosed. Should forfeiture be allowed as a remedy for failure
to properly disclose, some 3,500 transactions that took place
during this timeframe would be at risk. That would gravely
damage the entire industry.
2:28:55 PM
CHAIR COSTELLO asked how the bill clarifies the will of the
legislature in 2003.
MR. PICKETT replied the will of the legislature is determined by
courts after a review of the legislative history. This includes
testimony, written comments and anything put on the record. His
understanding is that the legislature in 2003 was trying to
clarify the same thing that SB 76 seeks to clarify. That is that
permitting forfeiture as a remedy for violations of the dual
agency provisions would have a very disruptive impact on the
real estate industry.
CHAIR COSTELLO asked Senator Ellis if he had supplemental
information.
SENATOR ELLIS replied the previous comments reflect his memory.
2:30:53 PM
SENATOR STEVENS asked why the bill is retroactive [to January 1,
1991], if anyone would be harmed by the retroactivity and how
they would be harmed.
MR. PICKETT explained that the bill is necessarily retroactive
so it applies to cases and claims brought since the 1998
amendment made disclosure of dual agency a requirement. The bill
makes it clear to the courts that the intent of the legislature
in 2003 was that only actual damages would be awarded to a
consumer if provisions of the dual agency requirement were
violated.
SENATOR STEVENS asked if there are ongoing court cases to which
this would apply and if it would provide a definitive answer for
any court decisions.
MR. PICKETT confirmed that a case has been ongoing since 2010
could be affected, and others could be brought based on
transactions between 1998 and 2003. He said the ambiguity in the
law is related to whether the limitation to actual damages
applies to common law actions. It clearly applies to statutory
actions. The pending case could be affected because the bill
would require the courts to apply the limitation to actual
damages in any case arising out of the failure to disclose dual
agency representation.
2:34:23 PM
CHAIR COSTELLO asked how to rationalize a retroactive effective
date when one legislature is not able to bind another
legislature.
MR. PICKETT explained that retroactivity is a permitted power of
a sitting legislature. One legislature may not bind a future
legislature, but it is permissible for a legislature to change
what an earlier legislature has done.
SENATOR STEVENS asked for an explanation of actual damages as
opposed to other types.
MR. PICKETT explained that actual damages are out-of-pocket
losses a buyer or seller might have suffered as a result of not
understanding that the agent was representing both parties. The
claimants in the pending case are seeking the punitive damage of
forfeiture. Those claimants would like the real estate agents
that didn't technically comply with the disclosure requirement
to disgorge the commissions and fees that they earned.
2:37:05 PM
CHAIR COSTELLO found no further questions or testimony and
closed public testimony.
2:37:24 PM
SENATOR STEVENS motioned to report SB 76 from committee with
individual recommendations and attached fiscal note(s).
CHAIR COSTELLO announced that without objection, SB 76 is
reported from the Senate Labor and Commerce Standing Committee.
2:37:37 PM
There being nothing further to come before the committee,
Senator Costello adjourned the Senate Labor and Commerce
Standing Committee at 2:37 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Commissioner DOLWF - Drygas #3.pdf |
SL&C 4/7/2015 1:30:00 PM |
Appointment Confirmations |