Legislature(1997 - 1998)
03/30/1998 03:40 PM Senate RES
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SENATE RESOURCES COMMITTEE
March 30, 1998
3:40 P.M.
MEMBERS PRESENT
Senator Rick Halford, Chairman
Senator Lyda Green, Vice Chairman
Senator Loren Leman
Senator Bert Sharp
Senator Robin Taylor
Senator John Torgerson
Senator Georgianna Lincoln
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
CS FOR HOUSE JOINT RESOLUTION NO. 51(MLV)
Relating to support for H.R. 2924, which allows certain Alaska
Native Vietnam era veterans and the Elim Native Corporation to
select land under the Alaska Native Claims Settlement Act.
- MOVED SCSHJR51(RES) OUT OF COMMITTEE
CS FOR HOUSE BILL NO. 285(RES)
"An Act relating to suspension or revocation of commercial fishing
permits, licenses, and privileges; and providing for an effective
date."
- HEARD AND HELD
CS FOR SENATE BILL NO. 330(L&C)
"An Act relating to underground facilities."
- HEARD AND HELD
PREVIOUS SENATE COMMITTEE ACTION
HJR 51 - See Resource Committee minutes dated 3/9/98.
HB 285 - No previous action to record.
SB 330 - See Labor and Commerce minutes dated 3/12/98.
WITNESS REGISTER
Mr. Don Stolworthy, Aide
Representative Beverly Masek
State Capitol Bldg.
Juneau, AK 99811-1182
POSITION STATEMENT: Commented on HJR 51.
Ms. Tom Wright, Aide
Representative Ivan Ivan
State Capitol Bldg.
Juneau, AK 99811-1182
POSITION STATEMENT: Commented on HB 285 for sponsor.
Mr. Bruce Twomley, Chairman
Limited Entry Commission
8800 Glacier Hwy, Ste. 109
Juneau, AK 99801-8079
POSITION STATEMENT: Commented on HB 285.
Mr. Jerry McCune
United Fishermen of Alaska
211 Fourth Street #112
Juneau, AK 99801
POSITION STATEMENT: Commented on HB 285.
Ms. Annette Krietzer, Aide
Senator Loren Leman
State Capitol Bldg.
Juneau, AK 99811-1182
POSITION STATEMENT: Commented on SB 330.
Mr. Jim Rowe, Executive Director
Alaska Telephone Association
201 E. 56th
Anchorage, AK 99518
POSITION STATEMENT: Supported SB 330.
Mr. Randy Nelson
Alaska Telephone Association
GTE
4300 B St. #303
Anchorage, AK 99503
POSITION STATEMENT: Supported SB 330.
ACTION NARRATIVE
TAPE 98-23, SIDE A
Number 001
HJR 51 - SUPPORT H.R. 2924
CHAIRMAN HALFORD called the Senate Resources Committee meeting to
order at 3:40 p.m. and announced HJR 51 to be up for consideration.
SENATOR SHARP moved to adopt the CS to HJR 51. There were no
objections and it was so ordered.
SENATOR LINCOLN asked about the Elim Native Corporation.
MR. DON STOLWORTHY, Aide to Representative Masek, explained that
they tried numerous times to get answers to some of the questions
that were brought up at the first hearing, about why agree to
297,000 acres at first and, now, why another 50,000. Mr. Robert
Keith, President of the Corporation, said the 50,000 acres should
have been included because it was not withdrawn legitimately by
Presidential Executive Order, but he didn't know why the argument
wasn't brought up in the ANCSA closure. He asked Mr. Keith how
much of the land and money they had received. He said
approximately a third of the land, but he was too young to remember
how much money they received and there were no elders around to
ask. He knows that of the 50,000 acres, only 29,000 would be
eligible for selection. There are some minerals and hot springs on
some of the land they want to select. When they called Congressman
Young's office, they just didn't know what was happening.
SENATOR LINCOLN asked if they were leaving in the Elim Native
Corporation language.
CHAIRMAN HALFORD said the Whereas that describes Congressman
Young's HR2429 includes the Elim and Vietnam veteran's issue. The
Resolve speaks to the native allotment/Vietnam veteran issue; it
doesn't speak to the Elim issue.
SENATOR GREEN moved to pass SCS CSHJR 51(RES) out of Committee with
individual recommendations. There were no objections and it was so
ordered.
HB 285 - POINT SYSTEM FOR COMMERCIAL FISH VIOLATION
CHAIRMAN HALFORD announced HB 285 to be up for consideration.
REPRESENTATIVE IVAN, sponsor, said HB 285 addresses some concerns
about illegal fishing activities in his district and others. It
seeks to protect honest fishermen. It's been stated that these
illegal activities have become a philosophy among some fishermen
and they are just the cost of doing business if they are cited for
it. The bill establishes a point system against the commercial
fishing permit holder for convictions of Title 16 commercial
fishing laws. Twelve or more within a 36 month period would result
in a one year suspension by the Commercial Fishery Entry
Commission, 16 or more within a 48-month period results in two-
years, and progresses up to 18 points or more in a 60-month period
which results in a three-year suspension of the permit. The
assessment of points, the suspension process, noticing, etc. are
provided for in the bill. Sections 5 - 9 were suggested by the
Commercial Fisheries Entry Commission and are a revision of current
statutes. References to forfeiture have been deleted, because it
is believed suspension and revocation of fishing privileges by the
Entry Commission are more consistent with the legislature's prior
determination that fishing privileges are use privileges and not
property.
This legislation is strongly supported by the Department of Public
Safety and the Commercial Fisheries Entry Commission. He has
worked with the lending institutions, namely CFAB and the Division
of Investments, the Commercial Fisheries Entry Commission, Public
Safety, and attorneys well-versed in commercial fishing laws.
Number 165
SENATOR LEMAN asked if he had worked with the Division of
Investments on loan obligations and valuation of the permits since
the January 26, 1998 letter was written.
REPRESENTATIVE IVAN answered that they were concerned because as a
lending institution, they make loans secured by pledges of limited
entry permits. Pursuing the individual permit holder alleviated
some of their concerns.
CHAIRMAN HALFORD noted when the legislature tried this a few years
ago, they attached it to the permits and it was successful in
getting out of the Senate, but it died in the House.
MR. TOM WRIGHT, Staff to Representative Ivan, said initially the
points were going to be attached to the permit, but Mr. Cameron
Jenson, an attorney well-versed in commercial fishing lending laws,
said if a permit was going to be revoked after a certain number of
points accumulated, they ran into the questions of takings, due
process, and equal protection laws. They would have had to rewrite
a number of statutes for CFAB and the Division of Investments in
order to do the revocation. That's why they came up with the
suspension for one, two or three years with the thought being if
someone has their permit suspended for a two-year period, they are
going to get out of the fishery, because they couldn't afford to
sit on the beach for two years.
SENATOR LEMAN said he thought this was a good idea, but he is
concerned about an accumulation of points for a series of pretty
minor violations, like trailer buoys.
MR. WRIGHT said they had discussed this with the Department of
Public Safety and they usually take those things into consideration
before issuing a citation.
SENATOR LEMAN asked in the case of trailer buoys, each buoy
wouldn't be a separate violation.
MR. WRIGHT answered that would be his impression from conversations
with Colonel Glass.
Number 267
CHAIRMAN HALFORD asked if the individuals who have to "sit out"
would have an opportunity to do an emergency transfer of their
permit, and then crew on that boat.
MR. WRIGHT answered if the license is suspended, they cannot
transfer it.
CHAIRMAN HALFORD asked what happens if they have a violation, but
not a conviction and while they are waiting to go to court, they
transfer the permit.
MR. BRUCE TWOMLEY, Commercial Fisheries Entry Commission, answered
if he hasn't reached the point where the permit is suspended, and
with it the transferability of the permit which would stop that
process cold, he would need to make an independent showing that he
is qualified for an emergency transfer under the existing law. He
could get one with that showing. One of the provisions in the bill
may address that in part. If there is a violation during an
emergency transfer, the demerit points are assessed against both
the permit holder and the transferee.
CHAIRMAN HALFORD said there is a lot of time after a violation
before a sentence or final disposition during which a person could
just do a straight transfer to his brother or his best friend, or
to whomever. He asked how can they could stop that.
MR. TWOMLEY answered the points are going to track the individual,
so if he's caught in a subsequent violation, the points are going
to build up against him. He didn't see that as being a real
opportunity to escape the effect of this bill.
Number 350
CHAIRMAN HALFORD said for example, there are three brothers from
California who come up here every year and fish Bristol Bay; they
are high-line line fishermen who are not popular with the locals
and do very well. They work the line as the cost of doing business
and the first year they get a violation and brother A has the
permit in his name. The second year, they get another violation
and are cited (it's on video, so they know they are going to get
caught), but it hasn't been to court, yet. So brother A transfers
the permit to brother B. The third year, they go out and fish
again. Brother A is now a crew member on his own boat with his
brother now carrying the permit. The permit isn't suspended
because it was transferred before it had 12 points against it.
MR. TWOMLEY said he thought this question points out the virtue of
this bill and the fact that the demerit points track the
individual. If that individual has a case pending against him,
those points are going to apply to him if he's convicted. Even
during this period, if he's caught in another violation while his
brother holds the permit and is cited, those points will be
assessed against him and build a record against him which could
lead the Commission to suspending his fishing privileges.
CHAIRMAN HALFORD said it seems to him that three brothers could
keep this thing moving for a long time. He asked, suppose he's a
crew member on the boat and his brother's running the boat and they
are over the line again, is he going to get a violation as a crew
member? Is he going to get cited? He didn't see them citing all
the crew members.
MR. WRIGHT answered the point is if he transfers the permit to
Brother B, he is still the owner of that permit.
CHAIRMAN HALFORD said no, as far as the law is concerned, he sold
the permit to his brother. So the first two years are covered by
the first brother, then the second brother has it on the third year
and gets caught and again the fourth year. So he transfers the
permit before the second conviction in the fourth year to Brother
C. Brother C is in charge for the fifth and sixth years and then
they are getting close to where they can go back to Brother A and
start all over again. If there are four brothers, he knows they
can do it.
He noted a letter from CFAB and said maybe one of the benefits the
legislature wants out of this is that violations would result in a
financial disadvantage to the offending permit holder in the event
of a sale of permit during the period in which there are points
effectively outstanding by being worth significantly less money.
MR. WRIGHT pointed out that there are opportunities for the permit
holder to duck this thing, assuming the points track the permit. He
can unload the permit when he sees the prices of permits falling
and buy one back that is free and clear of any points.
CHAIRMAN HALFORD wants to catch them both ways. He said he is very
pleased to see this bill because he thought it could do some good
in the worst kinds of line fisheries.
Number 409
SENATOR SHARP asked if it was possible to make it statutorily
binding that if there's a pending violation that may result in
suspension, they cannot transfer the permit until the result of the
court case.
CHAIRMAN HALFORD said he thought that would slow it down, at least.
MR. WRIGHT said it would be possible to do that, although the
premise of the bill is different than that. The demerit points are
not to be assessed until there was due process because you wouldn't
know if a conviction would stick or not. The bill operates from
the point of conviction rather than citation. They have found that
not everything is recorded through the computer system.
MR. TWOMLEY said they have learned through work on this bill that
there isn't one unified computer system for the courts right now.
CHAIRMAN HALFORD asked if the Department could give it to you when
they file the charge outside of the court system.
MR. TWOMLEY said they could give the citations to him, but a number
of those wash out for any number of reasons.
CHAIRMAN HALFORD said he wanted to work with CFAB and the sponsors
and pass this bill.
MR. WRIGHT added that Division of Investments had an interest as
well.
CHAIRMAN HALFORD asked if they make direct loans.
MR. WRIGHT said he understands that they make loans for commercial
fishing permits.
CHAIRMAN HALFORD asked if they are currently doing that or are they
old loans.
MR. JERRY MCCUNE, United Fishermen of Alaska, said one of the loan
programs is for residents only.
CHAIRMAN HALFORD said he didn't think it was a bad idea if a permit
with some points on it was worth a little less. This is the kind
of thing that the bandits who work the lines the hardest
understand.
MR. WRIGHT said they had that conversation with Colonel Glass and
that's one of the things you try to find your way around.
MR. MCCUNE said they wanted to attach the points to permits, but
the reason they didn't was because of conversations with Division
of Investments and CFAB indicating that people use their permits as
collateral for their purchase.
CHAIRMAN HALFORD said one of the impacts of CFAB's exposure would
be that they would be very careful when they looked at someone's
record as to whether they would make them a loan to buy a permit in
the first place.
MR. MCCUNE said they run afoul of some federal and state lending
laws if they try to do something to the permits, like assess them
to devalue them.
CHAIRMAN HALFORD said they have to be consistent with the State's
IRS case which says that permits are really worthless.
REPRESENTATIVE IVAN said he would like to help them work through
the issues.
SB 330 - LOCATING UNDERGROUND FACILITIES
CHAIRMAN HALFORD announced SB 330 to be up for consideration.
MS. ANNETTE KREITZER, Aide to Senator Leman, sponsor, explained
currently there are no statewide standards for locating underground
facilities, so SB 330 was introduced at the request of the Alaska
Telephone Association to provide an understanding of the standards
and responsibilities for locating and excavating underground
facilities throughout the State. It amends AS 42.30, but doesn't
tie this to the Public Utilities Commission. Mr. Bob Loher,
Executive Director, said they have reviewed the legislation and
think it's a good idea, but they don't deal with contractors.
CHAIRMAN HALFORD said the bill doesn't really look at the small
contractor and somehow they end up with an unfair result. One of
the places it looked like that to him was on page 3 where an
excavator discovers an underground facility that was not field
marked or was inaccurately field marked and has to stop working
even though he still has to pay for the rent of his machine.
Another area of concern is the excavator being liable for treble
damages for intentional or "knowing" damage. He didn't know what
the "knowingly" standard meant.
TAPE 98-23, SIDE B
Number 580
MS. KREITZER responded that treble damages is proposed amendment
three. She had spoken with the Alaska Telephone Association who
had no problem with deleting "knowingly" from intentionally
damaging a facility. They would also want to delete the definition
of "knowingly" on page 6.
Also, amendment two should read, "An excavator shall not be liable
for inadvertent damage caused to an inaccurately field marked
underground facility." She thought that might address his concern.
She had talked to Mr. Row of ATA about how to recover down time and
how much is the nature of doing business. She didn't know how much
they could prevent in a bill like this.
CHAIRMAN HALFORD said for example the operator/owner of the
underground facility is required to make a locate marking once,
but, if in the process of a project, they lose the locate markings
and have to do it again, the excavator is responsible for paying
for the second time around. If something is improperly marked and
that stops the project and causes a great deal of delay for the
excavator, there should be some standard at which point the
operator's mismarking causes them to share in that cost.
Number 472
MR. JIM ROWE, Director, Alaska Telephone Association (ATA), said
Alaska has no state utility locate standards and its efficiency,
uninterrupted service, and public safety will benefit by having
standards. In 1996, the ATA discussed uncertainties about
responding to a request for a locate from an excavator and their
expectations for response from the excavator. Comments were
received from ORICA, the National Utility Locating Contractors
Association, Locate Call Center of Alaska, NL&P, Anchorage Area
Utility Association, Enstar, Alaska Building Contractors,
Associated General Contractors of Alaska, and the Anchorage
Homebuilders Association. He said they have no problem with
deleting "knowlingly." The treble damages is only to address very
intentional damage. The other aspect is Section (h), page 3, and
the small contractors might view this as being unbalanced and that
is not their intention. They are trying to be up front about this
and are receptive to anything that's palatable.
Number 453
SENATOR SHARP said he had terrible problems with treble damages
being very severe. He didn't know how many contractors were out
there who are sizeable enough to understand this, let alone get
involved in treble damages if they don't.
CHAIRMAN HALFORD said he was glad that the Homebuilders were
involved because they employ a lot of the little dirt work guys.
SENATOR SHARP asked what happens if at night, a customer calls an
excavator and says he has water flowing all over his backyard, does
the excavator say he can't come until tomorrow. He couldn't see
how an excavator could perform an emergency service for a homeowner
on a city lot.
MR. ROWE said that was only for intentional damages.
SENATOR SHARP said he didn't really understand the difference
between knowingly and intentionally.
SENATOR GREEN said knowingly is a lesser level.
SENATOR SHARP said if you are excavating on a city block, you
probably know that there are utilities all over the place. He
thought the little guy was going to really get hung out to dry on
this bill.
CHAIRMAN HALFORD said he still has those concerns, too.
MR. RANDY NELSON, Alaska Telephone Association, said he also
represents GTE Alaska, his employer and supported SB 330. He has
been both an excavator and a utility owner. The emphasis in the
bill from his point of view is that they move employees from one
location to another and will have uniform and well defined areas of
responsibility from all the utilities. He thought the intent of
the treble damages was to resolve the concern about an excavator
cutting through small laterals, because it would be cheaper to
repair them than to hold up construction. It's not to penalize
anyone in an emergency situation. The intent when the operator
finds an unmarked utility is to stop and find out what it is. They
do not want them to stop and wait for hours and hours for a locate.
As a utility, they would just want it identified as quickly as
possible.
Number 410
CHAIRMAN HALFORD asked if the questions in the letter from Chugach
Electric were addressed in Labor and Commerce.
MS. KREITZER answered no. The first question in the letter was
charges for locate services and she explained that they are trying
to keep this bill simple and away from the Public Utilities
Commission who approves all fees. However, there is nothing in the
bill that prohibits a facility or utility from charging for a
locate. The second item, the definition of repair, if the
Committee wants to adopt one, they should look at what accepted
industry standards are. There is some debate about whether a
splice in a cable is actually a weakening of the cable or not and
should it have to be replaced for 150 ft. for a small ding. They
chose not to put that in the bill.
They tried to keep the definition of operator that is currently in
law. The definition here (number 3) means a person who owns,
manages, or controls, which is not the definition that is in AS
42.05.990. It is a much longer definition, so she didn't see any
benefit to using it. Regarding the exposure of energized cables
(number 4), there are currently specific provisions in the National
Electric Safety Code and the Federal regulations that require
exposed, high-voltage facilities be monitored and handled by
qualified personnel.
SENATOR LEMAN asked if these comments were shared with anyone from
the Alaska Telephone Association or other people who have
participated in this bill.
MS. KREITZER answered she didn't know if anyone had seen them.
SENATOR LEMAN asked Mr. Rowe if he had seen the letter from Chugach
Electric.
MR. ROWE answered that he saw the original draft about a week ago.
He explained they tried not to make this bill specific to any
particular utility; it's not a telephone bill, although they are
the industry that got it going. He is comfortable with Ms.
KREITZER's comments.
CHAIRMAN HALFORD said the letter has an interesting approach to
liability instead of the treble damages section. It could be
modified to take their last paragraph and instead of the treble
damages section, to say if an underground facility or an excavator
is damaged by failure to fulfill an obligation under this law, the
party failing to perform the obligation is liable to the other
party for damages resulting from the failure to perform. He didn't
want to set something up where he expects people to go back and
forth to court on, but if everyone knows what the court would be
deciding if they did end up there, they usually perform to that
standard. This could be a way to make sure they have the kind of
balance they need. He didn't know how to deal with the question of
down time, locate costs, values, etc. The term "industry
standards" sounds good to him as far as values and repairs. There
is potentially another side of it from the excavator's point of
view. There could be another side of it from Senator Sharp's
homeowner's point of view.
MR. ROWE said during the many discussions with the Engineering
Planning Committee one of the comments that impressed him was when
a locate is requested, it's a customer service and we're there to
serve our customers. The excavators are also customers. It's not
an adversarial position. Their real job is to keep the utility
service working on a safe and dependable basis for the customers.
He wanted any changes that would be made to go along with that
goal.
SENATOR TAYLOR asked if it was correct that in Anchorage, if you're
putting in a subdivision building or a couple of lots and want
utilities put in, you can only have them put in by a contractor
that is on an approved list with the utility company, and the only
contractors on that approved list are union contractors.
CHAIRMAN HALFORD said he wasn't bound by that in Chugiak/Eagle
River.
SENATOR TAYLOR said he got this information from a developer in
Anchorage.
SENATOR SHARP commented that approved list might the one that is
certified by the State as authorized to install.
SENATOR TAYLOR said his understanding was that you are limited to
two or three contractors and whatever they set for the price. You
couldn't get hooked up otherwise.
CHAIRMAN HALFORD said the utility was very rapid in their response
when he dug up his own utilities. He is concerned with adding
liability and then having what is an emergency in the eye of the
constituent, a job in the eye of the excavator and a problem in the
eye of the utility.
SENATOR TAYLOR said he was concerned that it becomes an opportunity
in the eye of someone else.
CHAIRMAN HALFORD said the Committee would work on trying to come up
with something that deals with these issues. He asked Senator
Sharp and Senator Leman to work with him on it.
SENATOR TAYLOR said he had a question about responsibility of
construction project owners and wanted to delete "the project owner
knows" on page 3, line 30 and delete "does not" on the next page,
because the owner should know what's in their land.
SENATOR LEMAN said that wasn't necessarily true, though.
CHAIRMAN HALFORD adjourned the meeting at 5:10 p.m.
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