Legislature(1995 - 1996)
03/09/1995 03:35 PM Senate STA
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
SENATE STATE AFFAIRS COMMITTEE
March 9, 1995
3:35 p.m.
MEMBERS PRESENT
Senator Bert Sharp, Chairman
Senator Randy Phillips, Vice-Chairman
Senator Loren Leman
Senator Jim Duncan
Senator Dave Donley
COMMITTEE CALENDAR
SENATE BILL NO. 89
"An Act relating to the members of the board and staff of the
Alaska Permanent Fund Corporation."
SENATE BILL NO. 90
"An Act establishing the Public Officers Compensation Commission;
relating to the compensation of the governor, lieutenant governor,
members of the legislature, heads of the principal departments of
the executive branch of government, supreme court justices, judges
of the court of appeals, judges of the superior court, and district
court judges; and providing for an effective date."
SENATE JOINT RESOLUTION NO. 16
Proposing an amendment to the Constitution of the State of Alaska
relating to the duration of a regular session.
SENATE BILL NO. 54
"An Act relating to exclusive service areas for utilities
certificated to provide electric utility service and to the
definition of 'general public' for utilities furnishing electric
service."
PREVIOUS SENATE COMMITTEE ACTION
SB 89 - No previous senate committee action.
SB 90 - No previous senate committee action.
SJR 16 - No previous senate committee action.
SB 54 - See State Affairs minutes dated 2/14/95 and 3/9/95.
WITNESS REGISTER
Jerry Jackson, Attorney
GCI
Anchorage, AK ¶265-5545
POSITION STATEMENT:
Dave Hutchens, Executive Director
Alaska Rural Electric Cooperative Association
703 W. Tudor, #200, Anchorage, AK 99503¶463-3636 or 561-6103
POSITION STATEMENT:
Ray Latcham
Anchorage, AK
POSITION STATEMENT:
Senator Steve Rieger
State Capitol, Juneau, Alaska, 99801-1182¶465-3879
POSITION STATEMENT: prime sponsor of SB 89
C.S. Christensen, Alaska Court System
303 K. Street, Anchorage, AK 99501¶264-8228
POSITION STATEMENT: prime sponsor of SB 90
Mike McMullen, Acting Director
Div. of Personnel/EEO, Dept. of Administration
P.O. Box 110201, Juneau, AK 99811-0201¶465-4430
POSITION STATEMENT:
Senator Robin Taylor
State Capitol, Juneau, Alaska, 99801-1182¶465-3873
POSITION STATEMENT: prime sponsor of SJR 16
ACTION NARRATIVE
TAPE 95-10, SIDE A
Number 001
SSTA - 3/9/95
SB 54 ELECTRIC UTIL & SOLID WASTE REMOVAL
CHAIRMAN SHARP calls the Senate State Affairs Committee to order at
3:35 p.m. and brings up SB 54 as the first order of business before
the committee. The chairman calls the first witness.
Number 018
JIMMY JACKSON, Attorney for GCI, testifying from Anchorage, states
GCI is in favor of competition, particularly in local exchange
telephone service. GCI was concerned that SB 54 would promote the
idea that competition was not viable other than in long-distance
telephone service. GCI has been working on adding intent language
to SB 54 saying the bill would apply only to electric utility
service, and in no way implies that any other utility has exclusive
service area. GCI supports such language, and with the addition of
such language, the bill would not affect GCI's interests' one way
or the other.
CHAIRMAN SHARP notes the committee does have a committee substitute
for SB 54 which would incorporate language.
Number 052
SENATOR DONLEY has questions about the bill that he wants answered
before the cs is adopted. He would like to know who requested the
legislation be introduced.
Number 075
DAVE HUTCHENS, Alaska Rural Electric Cooperative Association
(ARECA), states ARECA was the requestor of SB 54.
SENATOR DONLEY asks Mr. Hutchens why ARECA wants SB 54.
MR. HUTCHENS responds, "...several years ago there was legislation
enacted that attempted to accomplish much the same thing that was
introduced as a House Labor & Commerce Committee bill, chaired by
then Representative Donley. Unfortunately when the bill got to the
senate, there was an amendment put in that Section 2 uh, would,
would take out, and uh, then the Section 1 of the bill, uh excuse
me, in the cs it would be Section 2, that uh, it would, is the new
statement here to make it clear, just to clearly state the policy,
and so Section 3 would be the amendment to the legislation that
you, Representative Donley at that time, had sponsored, to get it
back to the original language of your bill."
SENATOR DONLEY again asks Mr. Hutchens why he wants SB 54.
MR. HUTCHENS says he will be glad to submit testimony at the
appropriate time.
CHAIRMAN SHARP states he would like to finish with the people on
teleconference first, then Mr. Hutchens can testify.
Number 112
SENATOR RANDY PHILLIPS asks Mr. Latcham if he has seen the latest
cs for SB 54.
MR. LATCHAM does not know if he has for sure.
Number 125
CHAIRMAN SHARP states there is a cs dated 3/7/95 by Cramer.
MR. LATCHAM responds he has that version.
CHAIRMAN SHARP informs Mr. Latcham that is the version the
committee is looking at; it has not been adopted yet, but it is the
result of the work that has been done so far.
RAY LATCHAM, President of Northern Eclipse, Incorporated,
testifying from Anchorage, states Northern Eclipse, Inc. is a
natural gas concern. Northern Eclipse, Inc. opposes SB 54, and has
sent a letter of opposition to the committee. Mr. Latcham believes
all committee members have received a copy of the letter. Mr.
Latcham states he was involved in the original legislation to which
Mr. Hutchens referred. Mr. Latcham thinks the electric utilities
are probably the most inefficient group of utilities, and they have
been very resistant to new technology. If SB 54 is passed, it will
preclude Northern Eclipse, Inc. from getting its' electricity from
an independent power producer. Electric companies do have the
benefit of economy of scale, and if they cannot compete with an
independent power producer, they have a problem.
SENATOR RANDY PHILLIPS asks Mr. Latcham if he has the cs in front
of him.
MR. LATCHAM responds he does.
SENATOR RANDY PHILLIPS asks Mr. Latcham if he still opposes SB 54
in that form as well.
Number 175
MR. LATCHAM replies he certainly does. The words, "and presently
or formerly served by" were part of the compromise worked out
several years ago. Now the electric companies are trying to un-do
the compromise.
Number 180
CHAIRMAN SHARP asks Mr. Latcham what stage the Point MacKenzie
development is at.
MR. LATCHAM responds the land has been acquired. It is a pilot
project; it is a 10,000 gallon a day liquefaction unit. Liquid
natural gas (lng) will be transported by truck to markets within
the state.
CHAIRMAN SHARP asks Mr. Latcham if his company has a gas source.
MR. LATCHAM responds it is Beluga River.
Number 210
MR. HUTCHENS states ARECA is interested in SB 54 because the
utility business is an inherent monopoly. The investment a utility
must have in a distribution system is not conducive to duplicate
facilities. However, the staff at APUC wants to encourage
regulated competition. Mr. Hutchens does not know how that could
be done. He wants a clean statement giving direction to the
commission, and that is what SB 54 would do.
Number 265
SENATOR DONLEY comments he is starting to remember the issues.
MR. HUTCHENS states the idea is to prevent a company from providing
power just to the most desirable customers. People could still
generate their own power, but a business couldn't just provide
power to the most desirable customers.
SENATOR DONLEY states he understands SB 54 now, and has no
objection to the cs.
Number 287
SENATOR LEMAN asks if a store owner who generates his own power
could sell power to eight other customers, and still be consistent
with SB 54.
MR. HUTCHENS responds, no, not if it is within a certificated
service area to a utility. The language "ten or more" applies to
all other kinds of utilities. Mr. Hutchens, in responding to Mr.
Latcham, states Mr. Latcham's company will be required to contact
Matanuska Electric and negotiate a rate. That rate would then have
to be approved by the APUC. Mr. Hutchens is confident Matanuska
Electric would be able to effectively compete with any independent
power producer. He does not think SB 54 would interfere with Mr.
Latcham's proposal.
Number 320
SENATOR RANDY PHILLIPS makes a motion to adopt the committee
substitute for SB 54.
CHAIRMAN SHARP notes that the cs adds the intent language that has
been worked out to satisfy the telephone companies concern that
somehow SB 54 would affect the telephone companies. There was also
an omission on line 10 which has been corrected, adding the word
"electric." The chairman, hearing no objection, states the
committee substitute for SB 54.
Number 348
SENATOR RANDY PHILLIPS makes a motion to discharge SB 54 from the
Senate State Affairs Committee with individual recommendations.
CHAIRMAN SHARP, hearing no objection, orders SB 54 released from
committee with individual recommendations.
CHAIRMAN SHARP announces a brief at ease for a floor session.
CHAIRMAN SHARP calls the Senate State Affairs Committee back to
order at 4:20 p.m.
SSTA - 3/9/95
SB 89 PERMANENT FUND BOARD MEMBERS & STAFF
SENATOR SHARP brings up SB 89 as the next order of business before
the Senate State Affairs Committee and calls the first witness.
Number 360
SENATOR RIEGER briefly summarizes the sponsor statement. Senator
Rieger summarizes the feedback from the Alaska Permanent Fund
Corporation (APFC), saying the corporation is neutral on SB 89. He
has received two suggestions for amendments. The first suggestion
was that the language, "recognized competence and wide experience
in investment portfolio management" is to demanding a requirement
for all members of the board to have. So Senator Rieger asks that
the bill be changed to require just two members of the board to
have that kind of experience. The second suggestion was that the
term, "for cause" was very broad and vague. So in the second
amendment, Senator Rieger attempts to spell out what that term
would entail. He models the definition of "for cause" on other
definitions already in Alaska Statutes.
SENATOR LEMAN wants to know under the term, "for cause" if there
would be instances of personal behavior or activities for which a
board member could be removed.
SENATOR RIEGER states the definition is modeled after references to
the Commissioner of the Department of Education, and address only
performance in office and performance related to the duties in
office. Where "for cause" is spelled out, performance has to do
with performance in office, and not performance outside of office.
SENATOR LEMAN comments there are some things that are so vile, he
thinks everyone would want to see that person removed from office.
SENATOR RIEGER states the more broad that definition is, the harder
it will be to determine whether the removal really was done for
cause. At some point, the outside action of a member may trigger
dismissal under paragraph (1), which addresses inability to perform
duties.
SENATOR LEMAN comments, such as if the person was in jail.
Number 440
CHAIRMAN SHARP also adds a governor could probably dismiss a member
with the reason that there was an overwhelming lack of public
confidence in a member's performance or ability to perform.
SENATOR LEMAN makes a motion to adopt the amendment to SB 89.
CHAIRMAN SHARP, hearing no objection, states the amendment has been
adopted.
Number 450
SENATOR DUNCAN asks if there has been any response requested from
the administration.
SENATOR RIEGER responds there has been no response requested from
the administration, other than the response from APFC.
SENATOR DUNCAN thinks a response should be requested from the
administration.
CHAIRMAN SHARP agrees with Senator Duncan. The chairman asks that
a response from the administration be requested so that the next
committee of referral (Senate Finance Committee) will have that.
Number 470
SENATOR LEMAN makes a motion to discharge SB 89 from the Senate
State Affairs Committee with individual recommendations.
Number 472
CHAIRMAN SHARP, hearing no objection, orders SB 89 released from
committee with individual recommendations.
SSTA - 3/9/95
SB 90 PUBLIC OFFICERS COMPENSATION COMMISSION
Number 475
SENATOR SHARP brings up SB 90 as the next order of business before
the Senate State Affairs Committee and calls the first witness.
Number 477
CHRIS CHRISTENSEN, General Counsel, Alaska Court System, prime
sponsor of SB 90, reads the sponsor statement for SB 90. Mr.
Christensen explains how the commission would work, as outlined in
SB 90 and a letter submitted to the committee by the court system.
Number 528
SENATOR LEMAN asks Mr. Christensen if the legislature could make
specific changes to a report from the compensation commission, or
would it have to reject a report in its' entirety.
Number 531
MR. CHRISTENSEN responds the report would have to be rejected in
its' entirety. The first time the commission does an order, it
will have to do an order for everyone. Following the first time,
the commission will be able to do separate orders. However, with
each specific order the legislature receives from the commission,
the legislature would have to reject an order in its' entirety.
SENATOR LEMAN asks Mr. Christensen if he expects the order to
consist of all offices at once, or if it would come down
individually.
Number 540
MR. CHRISTENSEN replies the bill is silent to that question, but he
expects the first order would include an adjustment for everyone,
since that hasn't been done in quite some time.
SENATOR DUNCAN asks if the legislature would have to take an action
of rejection or approval on an order.
MR. CHRISTENSEN responds the legislature must reject an order
within 60 days by enacting legislation. If they do not enact
legislation to reject an order, and an appropriation is put in the
operating budget, then it automatically takes effect.
Number 548
SENATOR DUNCAN asks Mr. Christensen who suggested the change made
in Section 7. It includes, "Salaries, per diem if authorized by
order of the Public Officers Compensation Commission...."
Number 552
MR. CHRISTENSEN believes the drafter added that particular language
because the existing statute refers to per diem. Once the
commission is created, it is the commission that will be setting
per diem, not the council.
SENATOR DUNCAN asks where it says that, and if that is the only
place it says that. He is not sure he agrees with that. He is not
sure how Section 7 works anyway, because right now, "other
allowances" aren't vouchered. This language would mean "other
allowances" would have to be vouchered. He guesses that would
include the office allowance. He asks if AS 24.10.120 is presently
in statute, and the only new language is that which is underlined.
MR. CHRISTENSEN replies that is correct: the only new language in
Section 7 is that which is underlined, "Salaries, per diem if
authorized by order of the Public Officers Compensation
Commission...."
SENATOR DUNCAN asks if legislators are currently required by law to
voucher their office allowances. Senator Duncan disagrees that
legislators are currently required to voucher their office
allowances.
MR. CHRISTENSEN responds that the existing law requires legislators
to voucher their office allowances, but he realizes there are a lot
of laws on the books that are not followed the way they were
originally intended.
SENATOR DUNCAN doesn't know why the court system keeps getting
involved in other branches of government's business. He is not
anxious to turn per diem and everything else over to some
commission.
Number 566
CHAIRMAN SHARP comments he would not want to take the heat for the
actions a commission might take over which he would have no
control. If he has to take heat for anything, he would just as
soon have it be for his own actions. It is his intention to hold
SB 90 in order to better educate himself on the legislation.
Number 574
SENATOR DUNCAN likes better the approach currently used, which is
that the legislature must adopt recommendations, not reject
recommendations.
MR. CHRISTENSEN adds that the reason nine other jurisdictions have
adopted this method, is because they viewed it as a good way of
actually reducing the heat, since the commission has the authority
to set salaries, and the legislature is not required to approve the
salaries.
SENATOR DUNCAN comments he doesn't like letting a commission do
that.
Number 586
MIKE MCMULLEN, Acting Director, Division of Personnel/EEO,
Department of Administration, states the administration is
sympathetic to the question of judges' salaries, and has no problem
with addressing that question. The legislature attempted to
address the problem by tying judges' salary changes to...
TAPE 95-10, SIDE B
MR. MCMULLEN:
...changes in AS 39.27.011, which hasn't changed since it was
adopted. So this set that scheme back, in terms of trying to keep
judges' salaries competitive, in order to attract judges. Mr.
McMullen states, where the administration has problems with this
bill is the same way you've just been talking about. If the
legislature's elected representatives are able to have their
salaries changed, they should be up front and taking a vote and
taking the heat. Likewise, the governor should be in a position to
see that coming through for his salary, and have his choice in
terms of vetoing or letting it become law by signature or without
signature. The mechanism set up here allows the order of the
commission to become effective, changing legislative salaries,
governor's salary, lieutenant governor's salary, his commissioners'
salaries without any affirmative action by the legislative body or
the governor. The solution to that would be for the recommendation
to come to the legislature, but it would take affirmative action to
put those into effect. That would resolve that problem.
MR. MCMULLEN states, the other problem the administration has with
SB 90 is the list of factors in Section 17. This section would
have an unexpected impact on collective bargaining. State
employees, all public employees in fact, who are class I (not able
to strike) have a binding arbitration process for setting the terms
and conditions of their collective bargaining agreement. The
arbitrators who hear these kinds of cases abhor a vacuum. Right
now there are no standards in Alaska law on what an arbitrator
should be looking at when he or she is setting these salaries.
This is a good list. It is modeled after another state. In the
past, we have had arbitrators specifically look at the State of
Oregon as an example of the things arbitrators traditionally look
at in setting salaries. Adopting this standard in Alaska Law, in
any place, will invite arbitrators to look at those standards. The
arbitrator will be in the position of having this independent body
making its' review and making a recommendation on salaries. This
may or may not be consistent with the position of the current
administration, with regard to the terms in the bargaining
agreement. In effect, the commission would be setting the pattern
for arbitrator decisions. We need to recognize that this is going
to happen, and fully debate the impact SB 90 will have on
collective bargaining. If it is not intended that SB 90 have an
impact on collective bargaining, then it should be stated that SB
90 is not intended to set a pattern in collective bargaining, or
the arbitrators are not to use it, or some other factor. We need
to either recognize that SB 90 will become the standard, or we need
to amend the bill to prevent it from becoming the standard. Mr.
McMullen mentions that the administration has submitted a zero
fiscal note for SB 90.
Number 550
CHAIRMAN SHARP states SB 90 will be held for further information.
SSTA - 3/9/95
SJR 16 LIMIT LEGISLATIVE SESSION TO 90 DAYS
SENATOR SHARP brings up SJR 16 as the next order of business before
the Senate State Affairs Committee and calls the first witness.
Number 540
SENATOR TAYLOR, prime sponsor of SJR 16, states he personally
supports SB 90, the bill heard in the Senate State Affairs
Committee immediately prior to SJR 16.
SENATOR DUNCAN asks Senator Taylor if he really supports SB 90.
SENATOR TAYLOR responds he does, and comments the legislature
hasn't had the guts to vote itself a salary since he got here.
SENATOR TAYLOR states SJR 16 is very simple; it would reduce the
length of legislative session to 90 days. Senator Taylor
introduces an amendment to SJR 16 which would require the
legislature to recess in order to hold committee meetings at
different locations throughout the state.
SENATOR DUNCAN asks what per diem rate legislators would get during
the recess.
SENATOR TAYLOR responds the legislature would get to set the per
diem rate; SB 90 (the Public Officers Compensation Commission) has
not been adopted yet.
Number 524
SENATOR LEMAN comments he likes SJR 16 as introduced, and though he
does not dislike the idea of recessing to hold interim meetings, he
thinks the amendment to SJR 16 would have the effect of not
shortening session at all. Senator Leman would support the
amendment if session was still constrained to 90 days total.
Number 509
CHAIRMAN SHARP adds he has a problem with the amendment, in that he
wouldn't care to continue renting an apartment in Juneau and not
receive per diem for it during a break in session.
Number 500
SENATOR TAYLOR states the subject of SJR 16 has been around before,
but has never gotten enough of a consensus in the legislature to
pass. He states that after having talked with several legislators
about their concerns, he thought the amendment might soften the
approach in order to get us closer. He is not fixed on any
particular dates or times. The amendment was just an idea that has
been floated, and he thought the committee should have the benefit
of it.
Number 495
SENATOR DUNCAN comments he likes the approach of the amendment. It
is important to get the legislature out to other communities and to
allow the committees to take action while holding meetings in other
communities. So he likes the amendment, but he doesn't like the
original bill. Senator Duncan is concerned that shortening session
would hand more power to the bureaucracy; it would weaken the
representative branch of government.
Number 474
SENATOR LEMAN disagrees with Senator Duncan's conclusion that
shortening the length of legislative sessions would erode the power
of the legislature, because legislators remain legislators, even
when not in session. He thinks it will cause the legislature to
get its' work done in a shorter time frame. It will be a little
more rigorous; there will probably be fewer weekends and fewer
three-day weekends. Senator Leman thinks if short sessions can
work in Wyoming, they can also work in Alaska, because the two
states have a lot in common.
SENATOR DUNCAN thinks there will be an erosion of power with
shorter sessions. If he was a lobbyist, he would love a shorter
session, because it puts it in the hands of people whose main job
is to make sure something doesn't happen. Senator Duncan does not
think Alaska is comparable to Wyoming. However, he appreciates the
approach of the amendment and wants to work with Senator Taylor on
improving access to the legislature.
Number 430
CHAIRMAN SHARP states SJR 16 will be rescheduled.
CHAIRMAN SHARP adjourns the Senate State Affairs Committee meeting
at 5:00 p.m.
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