Legislature(2001 - 2002)

05/03/2001 03:55 PM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                     ALASKA STATE LEGISLATURE                                                                                   
                  SENATE STATE AFFAIRS COMMITTEE                                                                              
                            May 3, 2001                                                                                         
                             3:55 p.m.                                                                                          
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                              
Senator Gene Therriault, Chair                                                                                                  
Senator Randy Phillips, Vice Chair                                                                                              
Senator Bettye Davis                                                                                                            
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Senator Rick Halford                                                                                                            
Senator Drue Pearce                                                                                                             
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
CS FOR HOUSE BILL NO. 96(HES)                                                                                                   
"An Act  relating to acquisition  and development  of the Jesse  Lee                                                            
Home; and providing for an effective date."                                                                                     
     MOVED SCS CSHB 96 (STA) OUT OF COMMITTEE                                                                                   
                                                                                                                                
CS FOR HOUSE JOINT RESOLUTION NO. 23(STA)                                                                                       
Advocating  the retention  of the  Electoral College  system in  its                                                            
present form.                                                                                                                   
     MOVED SCS CSHJR 23(STA) OUT OF COMMITTEE                                                                                   
                                                                                                                                
HOUSE BILL NO. 189                                                                                                              
"An Act repealing  statutory provisions relating to  term limits and                                                            
term limit pledges."                                                                                                            
     MOVED HB 189 OUT OF COMMITTEE                                                                                              
                                                                                                                                
CS FOR HOUSE BILL NO. 228(FIN)                                                                                                  
"An Act  relating to the  accounting of fees  from business  license                                                            
endorsements  for tobacco  products,  to the  disclosure of  certain                                                            
confidential   cigarette   and  tobacco  product   information,   to                                                            
notification  regarding  a cigarette  manufacturer's  noncompliance                                                             
with the tobacco  product Master Settlement  Agreement, to  business                                                            
license endorsements for  sale of tobacco products, to citations and                                                            
penalties for  illegal sales of tobacco products;  and providing for                                                            
an effective date."                                                                                                             
     MOVED CSHB 228(FIN) OUT OF COMMITTEE                                                                                       
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
HB 96 - No previous action recorded.                                                                                            
                                                                                                                                
HJR 23- No previous action recorded.                                                                                            
                                                                                                                                
HB 189- No previous action recorded.                                                                                            
                                                                                                                                
HB 228- No previous action recorded.                                                                                            
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
Representative Lancaster                                                                                                        
Alaska State Capitol, Room 421                                                                                                  
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Sponsor of HB 96                                                                                          
                                                                                                                                
Jim Stratton                                                                                                                    
Director                                                                                                                        
Division of Parks & Outdoor Recreation                                                                                          
Department of Natural Resources                                                                                                 
550 W. 7th Ave, Ste 1380                                                                                                        
Anchorage, AK 99501-3561                                                                                                        
POSITION STATEMENT: Answered questions on HB 96                                                                               
                                                                                                                                
Ray Gillespie                                                                                                                   
PO Box 593                                                                                                                      
Seward, AK 99664                                                                                                                
POSITION STATEMENT: Supports HB 96                                                                                            
                                                                                                                                
Tim Rogers                                                                                                                      
Alaska Children Services                                                                                                        
No address provided                                                                                                             
POSITION STATEMENT: Supports HB 96                                                                                            
                                                                                                                                
Representative Coghill                                                                                                          
Alaska State Capitol, Room 102                                                                                                  
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Sponsor of HJR 23                                                                                         
                                                                                                                                
Representative Rokeburg                                                                                                         
Alaska State Capitol, Room 118                                                                                                  
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Sponsor of HB 189                                                                                         
                                                                                                                                
John Manly                                                                                                                      
Staff to Representative Harris                                                                                                  
Alaska State Capitol, Room 513                                                                                                  
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT:  Introduced HB 228                                                                                        
                                                                                                                                
Elmer Lindstrom                                                                                                                 
Special Assistant to the Commissioner                                                                                           
Department of Health &                                                                                                          
  Social Services                                                                                                               
PO Box 110601                                                                                                                   
Juneau, AK  99801-0601                                                                                                          
POSITION STATEMENT: Answered questions on HB 228                                                                              
                                                                                                                                
Ed Sasser                                                                                                                       
Department of Health &                                                                                                          
  Social Services                                                                                                               
PO Box 110630                                                                                                                   
Juneau, AK  99801-0630                                                                                                          
POSITION STATEMENT: Answered questions on HB 228                                                                              
                                                                                                                                
Helen Donohue                                                                                                                   
Staff to Representative Lancaster                                                                                               
Alaska State Capitol, Room 421                                                                                                  
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Answered questions on HB 96                                                                               
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
TAPE 01-25, SIDE A                                                                                                            
Number 001                                                                                                                      
                                                                                                                                
                                                                                                                                
CHAIRMAN GENE  THERRIAULT called the Senate State  Affairs Committee                                                          
meeting to order at 3:55  p.m. Present were Senators Davis, Phillips                                                            
and Chairman Therriault.                                                                                                        
                                                                                                                                
The first order of business was HB 96                                                                                           
                                                                                                                                
                                                                                                                                
                  HB  96-ACQUIRING JESSE LEE HOME                                                                           
                                                                                                                                
REPRESENTATIVE  LANCASTER  explained that  HB 96  would establish  a                                                            
task force  within the Department  of Natural  Resources to  look at                                                            
the site and structure  of the Jesse Lee Home in Seward to determine                                                            
what can be  saved and what the proper  management structure  should                                                            
be to protect both the site and facility.                                                                                       
                                                                                                                                
This home in Seward  was built in 1925 as a children's  facility and                                                            
played a critical role  in serving health care and educational needs                                                            
of Alaska's orphaned children.  A number of the children who grew up                                                            
in the home went  on to distinguish themselves in  a wide variety of                                                            
fields. The most  notable is Benny Benson Jr. who  designed Alaska's                                                            
State flag while  living at the home. The flag was  first officially                                                            
raised there on July 9, 1927.                                                                                                   
                                                                                                                                
A private  party purchased  the site  and facility  in 1964  and the                                                            
Kenai Peninsula Borough  has recently foreclosed upon it and intends                                                            
to deed the  property to the City  of Seward. The task force  should                                                            
be able  to recommend  what should  be done with  the structure  and                                                            
will  hopefully  recommend   that  the  City  of  Seward  take  over                                                            
management  and receive  grant donations  from  private entities  to                                                            
develop the site  and provide a state cultural and  historical site.                                                            
                                                                                                                                
The House Finance  Committee did not adopt the fiscal  note for some                                                            
reason but there  is a $65,000 fiscal note that is  matched. He then                                                            
read the following e-mail from Jim Stratton, Director of Parks:                                                                 
                                                                                                                                
     In  2001  the capital  budget  here appropriated  federal                                                                  
     funds to the Division of  Parks and Outdoor Recreation for                                                                 
     the  National  Historic  Preservation   Fund  and Federal                                                                  
     Grants  Program,  $640,000.  The  office  of  history  and                                                                 
     archeology  administers this grant program, which  is made                                                                 
     available to local governments  and non-profits as well as                                                                 
     the state  for restoration and preservation projects  like                                                                 
     the Jesse  Lee Home. All grants from this program  must be                                                                 
     matched  50-50.  With the  $35,000 general  fund matching                                                                  
     fund request  in our fiscal note for HB 96, we'll  be able                                                                 
     to secure, through a match,  an additional $35,000 for our                                                                 
     existing  2001 grant program.  We had set aside a portion                                                                  
     of the total  2001 National Historic Preservation  Fund in                                                                 
     the  federal grants  program for state  opportunities  for                                                                 
     this one.                                                                                                                  
                                                                                                                                
The Department  of Natural Resources  (DNR) is willing to  work with                                                            
the program and  provide the match for the general  fund of $35,000.                                                            
                                                                                                                                
SENATOR  PHILLIPS  said  language   in  the  bill  said  DNR  should                                                            
determine  the costs  and  set up  some options.  He  referred to  a                                                            
letter in  his bill packet  that said a  commission would  determine                                                            
the costs  and set up options  and wondered  whether the  commission                                                            
concept had been abandoned.                                                                                                     
                                                                                                                                
REPRESENTATIVE  LANCASTER said there was no commission  established.                                                            
                                                                                                                                
SENATOR PHILLIPS  asked why the date for recommendations  to be sent                                                            
to the governor was set for November 1, 2002.                                                                                   
                                                                                                                                
JIM  STRATTON,   Director  of  the  Division  of  Parks   &  Outdoor                                                            
Recreation  responded that  if the commission  could be established                                                             
and the  process completed  prior to the  2002 deadline they  would.                                                            
However,  he did not see  that there could  be a full archeological                                                             
review of  the structure  and a full round  of discussions  with the                                                            
community completed  by the end of this year and ready  for the next                                                            
legislative  session  so  he  asked  for  a  year's  extension.  The                                                            
department  would  like  to have  the  conclusions  and move  on  as                                                            
quickly as possible.                                                                                                            
                                                                                                                                
CHAIRMAN  THERRIAULT  said  Senator  Phillips'  question  came  from                                                            
section 2, which  reads, "The Department of Natural  Resources shall                                                            
determine the  costs and procedures"  and it doesn't talk  about the                                                            
formation  of a  commission.  He asked  whether that  was still  the                                                            
intent.                                                                                                                         
                                                                                                                                
MR. STRATTON  said yes, their intent  is to establish a commission.                                                             
                                                                                                                                
SENATOR PHILLIPS said the sponsor said no commission.                                                                           
                                                                                                                                
REPRESENTATIVE  LANCASTER  said  to Mr.  Stratton,  "I thought  we'd                                                            
talked about just  establishing a committee to hire  an architect to                                                            
take a look at this facility.  A committee of interested persons and                                                            
someone from  the department and the  architect would actually  tell                                                            
us the valuation  of the site and  then we'd make recommendations."                                                             
                                                                                                                                
MR. STRATTON said  they were both talking about the  same thing; the                                                            
terminology  is just mixed up. A committee  would be established  to                                                            
hire the architect who  will make recommendations about what can and                                                            
cannot   be  done   with   the  structure   itself.   In  terms   of                                                            
recommendations  of  what to  do with  the property,  the  committee                                                            
would work  with DNR  to make  those determinations.  DNR would  not                                                            
work  independently;   they   want  to  work   with  the   committee                                                            
Representative Lancaster mentioned.                                                                                             
                                                                                                                                
SENATOR PHILLIPS  questioned that  it would take 18 months.  He also                                                            
wanted to know  whether the building  would be restored to  its 1926                                                            
condition.                                                                                                                      
                                                                                                                                
MR. STRATTON  wasn't sure the building  could be restored  or if the                                                            
amount  of money  it would take  to restore  it would  be worth  the                                                            
investment.  That's  the investigation  that  needs to  be done.  He                                                            
thought it could be done in less than 18 months but not in six.                                                                 
                                                                                                                                
REPRESENTATIVE  LANCASTER  said there  was a study  of the  building                                                            
done in 1999 and  the condition was marginal. It was  not a complete                                                            
study though  so there is need for  further investigation.  The goal                                                            
is  to restore  the  building  if  that  is possible  and  money  is                                                            
available.                                                                                                                      
                                                                                                                                
CHAIRMAN THERRIAULT  asked why there is a movement  toward the state                                                            
owning and being responsible  for maintenance and ongoing operation,                                                            
rather than the state participating  in helping the local government                                                            
to  renovate the  facility  and  then having  the  local  government                                                            
responsible  for coming up with the  operational plan and  operating                                                            
it.                                                                                                                             
                                                                                                                                
REPRESENTATIVE LANCASTER  thought it was because the borough was the                                                            
automatic  entity to receive  the property  through the foreclosure                                                             
process.  Since  the city  did not  have  sufficient  funds for  the                                                            
evaluation  process,  Mr. Stratton  thought  DNR could  help in  the                                                            
evaluation process.                                                                                                             
                                                                                                                                
CHAIRMAN THERRIAULT  said there was  money in the capital  budget or                                                            
they could pass  a separate appropriation bill they  could have come                                                            
up with money to underwrite  the effort but not to assume control of                                                            
the property in  perpetuity. He asked whether that  was necessary at                                                            
this point.                                                                                                                     
                                                                                                                                
REPRESENTATIVE  LANCASTER didn't know that it was  necessary or even                                                            
the goal. The  committee and the DNR  commissioner would  decide who                                                            
should control  and manage it in the  future. This is a first  step.                                                            
                                                                                                                                
CHAIRMAN  THERRIAULT   pointed  out   that  section  2  says,   "The                                                            
Department  of  Natural  Resources  shall determine  the  costs  and                                                            
procedures necessary for the state to acquire,".                                                                                
                                                                                                                                
REPRESENTATIVE  LANCASTER  said he didn't  know that  there was  any                                                            
goal for the  state to acquire and  own the property. The  committee                                                            
needs to determine who can best manage the facilities.                                                                          
                                                                                                                                
CHAIRMAN THERRIAULT  said he wasn't  interested in the state  paying                                                            
the city  to take  on the  responsibility  and wanted  to know  what                                                            
Representative  Lancaster had in mind as far as that  was concerned.                                                            
                                                                                                                                
REPRESENTATIVE LANCASTER  didn't think anyone had that in mind. They                                                            
would  like to  get the  department's  recommendation  about how  it                                                            
should be managed.                                                                                                              
                                                                                                                                
CHAIRMAN  THERRIAULT asked  Mr. Stratton whether  he envisioned  the                                                            
state taking ownership of the property.                                                                                         
                                                                                                                                
MR. STRATTON  said no, he  would like to  facilitate the  discussion                                                            
and  figure  out  what to  do  with  the property   and set  up  the                                                            
management  scheme.  He is very  interested  in the  City of  Seward                                                            
retaining ownership.                                                                                                            
                                                                                                                                
CHAIRMAN  THERRIAULT  asked if  there was  any reason  for the  bill                                                            
being  written so  that the  state  was responsible  for  acquiring,                                                            
developing and managing the property.                                                                                           
                                                                                                                                
MR. STRATTON said, from  his perspective, there was no reason for it                                                            
to be written that way.                                                                                                         
                                                                                                                                
SENATOR  DAVIS asked whether  anyone  had a copy  of the 1997  study                                                            
that  indicated  the  building   was  marginal.  She  asked  for  an                                                            
interpretation of "marginal."                                                                                                   
                                                                                                                                
REPRESENTATIVE  LANCASTER said  he would make  a copy available.  He                                                            
used the term  "marginal" because it was more a walk  through rather                                                            
than a complete and professional evaluation.                                                                                    
                                                                                                                                
SENATOR DAVIS  asked the question  because she had received  several                                                            
personal opinion messages  (POMs) stating that a study had been done                                                            
by the City of Seward.                                                                                                          
                                                                                                                                
REPRESENTATIVE  LANCASTER  responded  an independent  party who  was                                                            
thinking  of purchasing  the home  from the previous  owner had  the                                                            
study done.                                                                                                                     
                                                                                                                                
RAY GILLESPE  testified  that he  was representing  himself and  his                                                            
family. He  was born and raised in  Seward and is familiar  with the                                                            
history of  the Jesse Lee Home. He  went to school with the  orphans                                                            
and  his wife's  mother grew  up in  the orphanage  when  it was  in                                                            
Unalaska.  She then became  one of the house  parents when  the home                                                            
was moved to Seward and she raised her family there.                                                                            
                                                                                                                                
The facility  has historical  significance  and he  hopes a plan  is                                                            
developed to preserve it.                                                                                                       
                                                                                                                                
CHAIRMAN  THERRIAULT  asked whether  he had  interest  in the  state                                                            
acquiring the  facility since that  is the way the bill is  written.                                                            
                                                                                                                                
MR. GILLESPE said  he was familiar with a number of  individuals who                                                            
are interested in preserving  the site and none of them think it's a                                                            
foregone  conclusion  that  the  state  will  own  and  operate  the                                                            
facility.  That could be  explored but he  didn't believe the  state                                                            
would obligate  itself  to purchase  the facility  if it passed  the                                                            
legislation.  He suggested  the wording  could be  changed prior  to                                                            
moving the bill.                                                                                                                
                                                                                                                                
CHAIRMAN  THERRIAULT  said  he  would be  more  comfortable  if  the                                                            
wording  said  the  state  would   assist  the  City  of  Seward  in                                                            
developing a plan. If the  local government can't handle the project                                                            
without state  involvement that's  a future decision but  he doesn't                                                            
want to obligate the state from the beginning.                                                                                  
                                                                                                                                
MR.  GILLESPIE  said  that  wording   is  closer  to  the  community                                                            
expectations.                                                                                                                   
                                                                                                                                
TIM ROGERS,  Alaska Children's Services  Board Member, testified  in                                                            
support of the  efforts to renovate the Jessie Lee  campus. They are                                                            
willing to work  with DNR, the City of Seward and  any other parties                                                            
to facilitate the project.                                                                                                      
                                                                                                                                
CHAIRMAN  THERRIAULT said  HB 96 would  be set  aside. An  amendment                                                            
would be drafted  during the meeting break so the  legislation could                                                            
be considered for final action that day.                                                                                        
                                                                                                                                
Number 1265                                                                                                                     
                                                                                                                                
             HJR 23-MAINTAIN ELECTORAL COLLEGE SYSTEM                                                                       
                                                                                                                                
REPRESENTATIVE   COGHILL,   bill   sponsor,  said   the   resolution                                                            
encourages  Congress   to  retain  the  Electoral  College   without                                                            
modification as it is in  the constitution. There will be a national                                                            
debate on  the subject and  he thought it  wise to take a  stand. To                                                            
him, it  is an  issue of  the difference  between a  republic  and a                                                            
democracy.                                                                                                                      
                                                                                                                                
CHAIRMAN  THERRIAULT  commented that  although  the recent  national                                                            
election caused  some to charge the  Electoral College is  outdated,                                                            
he views it as a protection for states with smaller populations.                                                                
                                                                                                                                
He asked whether  anyone else wanted  to testify. There was  no one.                                                            
                                                                                                                                
CHAIRMAN  THERRIAULT  said  his  "eagle  eye staff"  pointed  out  a                                                            
missing word.                                                                                                                   
                                                                                                                                
He moved amendment 1. On  page 1, line 6 insert "in" after "provided                                                            
for" and before "the constitution". There was no objection.                                                                     
                                                                                                                                
He asked for other amendments. There were none.                                                                                 
                                                                                                                                
He asked for the will of the committee.                                                                                         
                                                                                                                                
SENATOR PHILLIPS moved  SCS CSHJR 23 (STA) from committee. There was                                                            
no objection.                                                                                                                   
                                                                                                                                
           HB 189-REPEAL TERM LIMITS/TERM LIMITS PLEDGES                                                                    
                                                                                                                                
REPRESENTATIVE  ROKEBURG,  bill  sponsor, described  the  bill as  a                                                            
simple bill that  needs caution because it is repealing  a citizen's                                                            
initiative that was passed by voters several years ago.                                                                         
                                                                                                                                
On February 28, 2001, in  Cook v. Gralike, the United States Supreme                                                            
Court found  that the scarlet  letter or gold  star type term  limit                                                            
pledges placed next to  candidates names were unconstitutional as it                                                            
related  to members  of the United  States Congress  and Senate  and                                                            
based on the election clause  theory. The court did not specifically                                                            
take up  freedom of  speech in terms  of this  type of pledge  being                                                            
unconstitutional  but the concurring  opinion of Justices  Rehnquist                                                            
and O'Connor  did bring that issue  forward indicating they  believe                                                            
any term limit pledge would  be an abridgement of freedom of speech.                                                            
                                                                                                                                
"Since  the Alaska  Statutes  are so  similar  to those  of Cook  v.                                                            
Gralike, this  United States Supreme Court ruling  suggests that our                                                            
statutes  are   unconstitutional.   This  bill  will  repeal   these                                                            
unconstitutional statutes."                                                                                                     
                                                                                                                                
SENATOR PHILLIPS  asked whether the  Supreme Court strikes  down the                                                            
state provision.                                                                                                                
                                                                                                                                
REPRESENTATIVE  ROKEBURG  said it  just spoke  to the congressional                                                             
provisions. It  didn't take up freedom of speech but  the concurring                                                            
opinion did.  The Idaho Supreme Court  and a federal district  court                                                            
in South Dakota both found these labels affect free speech.                                                                     
                                                                                                                                
There  is a  supporting letter  from  former Attorney  General  John                                                            
Havelock in  the committee packets.  He has been asked to  challenge                                                            
this on a state  level but he would  prefer to have the legislature                                                             
enact the bill.                                                                                                                 
                                                                                                                                
CHAIRMAN THERRIAULT  said the third page of the legislative  counsel                                                            
memo talks about severability.  The application of the Supreme Court                                                            
case probably  renders half of the  sections in the Alaska  Statutes                                                            
moot. It's now a question  of whether a state challenge would affect                                                            
the rest.                                                                                                                       
                                                                                                                                
REPRESENTATIVE  ROKEBURG agreed that the legal theory,  as expressed                                                            
in  Gralike  and  other  case  law,  would  strongly   support  that                                                            
position.                                                                                                                       
                                                                                                                                
SENATOR PHILLIPS gave a recap.                                                                                                  
                                                                                                                                
CHAIRMAN THERRIAULT  said certainly  the Supreme Court has  ruled on                                                            
the congressional  delegation but  the question is still  out on the                                                            
state portion.                                                                                                                  
                                                                                                                                
SENATOR PHILLIPS  said he  doesn't believe  in term limits  but this                                                            
was a citizen's initiative  that was approved by the voters and he's                                                            
reluctant to go against  their wishes unless the state supreme court                                                            
rules under the Cook v. Gralike ruling.                                                                                         
                                                                                                                                
REPRESENTATIVE ROKEBURG  pointed out the Idaho Supreme Court ruling.                                                            
CHAIRMAN THERRIAULT confirmed  that was a state supreme court ruling                                                            
on a state statute.                                                                                                             
                                                                                                                                
SENATOR PHILLIPS  asked whether the  American Civil Liberties  Union                                                            
(ACLU) was now challenging it.                                                                                                  
                                                                                                                                
REPRESENTATIVE  ROKEBURG responded  they were planning to  but would                                                          
rather have  the bill pass then there  wouldn't be the need  for the                                                            
challenge.                                                                                                                      
                                                                                                                                
Because of  the specific way the Alaska  statute is drafted  and the                                                            
type  of term  limit pledge  that  must be  taken, it  makes a  very                                                            
strong case  against it because  if you deviate  from the  drafters'                                                            
proposal you are  breaking the term limit pledge.  If he supports an                                                            
eight year  term limit in one body  and a four year term  in another                                                            
that's a total of 12 years.  State statute says eight years within a                                                            
period  of 16  years  and he  doesn't  agree  with that.  Putting  a                                                            
scarlet letter  next to his name on the ballot is  an abridgement of                                                            
his free  speech; it's  also compromising  the fundamental  right of                                                            
voting.                                                                                                                         
                                                                                                                                
CHAIRMAN THERRIAULT said  he supported the language proposing a term                                                            
limit  and for  him  "it's a  close call."  He  understands  Senator                                                            
Phillips   reluctance  to   change  a  voter   initiative   but  the                                                            
constitution  specifically says the  legislature may modify  a voter                                                            
initiative within two years.                                                                                                    
                                                                                                                                
It is also bothersome because  this is electioneering at the polling                                                            
place.                                                                                                                          
                                                                                                                                
REPRESENTATIVE ROKEBURG  stated the Idaho case said this effectively                                                            
grants the candidate a state endorsement.                                                                                       
                                                                                                                                
CHAIRMAN  THERRIAULT  commented it  would be  nice if  there were  a                                                            
clear decision from the Alaska Supreme Court.                                                                                   
                                                                                                                                
He asked for further testimony. No one came forward.                                                                            
                                                                                                                                
There was no prepared  CS and no amendments from committee  members.                                                            
There was a zero fiscal note.                                                                                                   
                                                                                                                                
He asked for the will of the committee.                                                                                         
                                                                                                                                
SENATOR DAVIS moved HB  189 and zero fiscal note from committee with                                                            
individual recommendations. There was no objection.                                                                             
                                                                                                                                
                  HB 228-SALE OF TOBACCO PRODUCTS                                                                           
                                                                                                                                
JOHN MANLY,  staff to  Representative Harris,  introduced the  bill.                                                            
Under  the federal  Synar amendment,  the state  is being  penalized                                                            
$1.5 million  in federal drug and  alcohol grants because  it is not                                                            
in  compliance  with the  limits  set for  the  sale of  tobacco  to                                                            
minors. In a recent  DHSS initiated survey of tobacco  retailers, it                                                            
was determined  that  nearly  2/3 of vendors  in  rural Alaska  sold                                                            
tobacco products  to minors, while  more than 1/3 of those  in urban                                                            
Alaska did.   Both are well above  the 20 percent federal  allowable                                                            
limit  indicating far  too  many minors  are buying  and  presumably                                                            
using tobacco products.                                                                                                         
                                                                                                                                
The  state  has agreed  to  invest  an additional  $481,687  in  the                                                            
tobacco  abatement and  enforcement  programs in  an effort to  meet                                                            
federal  compliance  limits  and qualify  for  the $1.5  million  in                                                            
federal drug and alcohol grants.                                                                                                
                                                                                                                                
HB 228  has an attached  $487,900  Department of  Health and  Social                                                            
Services  (DHSS)  fiscal  note  and  a zero  fiscal  note  from  the                                                            
Department  of  Revenue.   There  are  also fiscal  notes  from  the                                                            
Department  of Law  and the  Department  of Community  and  Economic                                                            
Development that  are funded with a reimbursable services  agreement                                                            
(RSA) from the DHSS fiscal note.                                                                                                
                                                                                                                                
This bill increases  the penalties  to businesses that sell  tobacco                                                            
to minors.  For a first offense businesses  would be fined  $300 and                                                            
receive a 20 day  suspension of their tobacco endorsement,  a second                                                            
offense within  a two year period  would bring a $500 fine  and a 45                                                            
day suspension  of the tobacco endorsement. For a  third offense and                                                            
a forth  offense within a  two year period  there would be  a $1,000                                                            
fine  and a  90 day suspension  and  a $2,500  fine and  a one  year                                                            
suspension of the tobacco endorsement respectively.                                                                             
                                                                                                                                
In  addition,  the  bill  would  increase  the  fee  for  a  tobacco                                                            
endorsement  on a business license  from the current $25  for a two-                                                            
year period to $100 for  that same period. An individual endorsement                                                            
would be required  for each location at which a chain  sells tobacco                                                            
products,  which  would  make it  easier  for  DHSS to  track  where                                                            
violations occur.                                                                                                               
                                                                                                                                
CHAIRMAN THERRIAULT  asked whether the $100 endorsement  was yearly.                                                            
                                                                                                                                
MR. MANLY responded it was for two years.                                                                                       
                                                                                                                                
CHAIRMAN  THERRIAULT  asked for  a recap  of the  penalties for  the                                                            
offenses and Mr.  Manly obliged. [They are outlined  above and fully                                                            
described in section 6 of the bill.]                                                                                            
                                                                                                                                
CHAIRMAN THERRIAULT  asked whether  there was any position  paper or                                                            
feedback from vendors.                                                                                                          
                                                                                                                                
MR. MANLY replied they had not gotten any feedback from vendors.                                                                
                                                                                                                                
ELMER  LINDSTROM,  Special Assistant  to  Department  of Health  and                                                            
Social Services  Commissioner  Perdue, said  he was happy to  answer                                                            
any questions.                                                                                                                  
                                                                                                                                
CHAIRMAN THERRIAULT  asked whether  businesses ever defend  sales to                                                            
minors by charging  that the minors  used false identification  (ID)                                                            
and if  so, what kind  of protection  does the  vendor have  in that                                                            
type of situation?                                                                                                              
                                                                                                                                
MR. LINDSTROM  said the  DHSS sting operations  are conducted  using                                                            
local law enforcement and  there is an extensive protocol on how the                                                            
operations  will be conducted.  One of the  primary requirements  is                                                            
that if a minor is asked  for an ID they produce their ID that shows                                                            
they are underage.                                                                                                              
                                                                                                                                
CHAIRMAN THERRIAULT  asked whether  the provisions in section  6 are                                                            
applied only through the state conducted sting operations.                                                                      
                                                                                                                                
MR.  LINDSTROM  didn't  believe so  but  he couldn't  think  of  any                                                            
enforcement   activity  that   was  not  sponsored   by  local   law                                                            
enforcement  or DHSS,  which  is the agency  that  trains local  law                                                            
enforcement on protocol.                                                                                                        
                                                                                                                                
ED SASSOR, Tobacco Enforcement  Coordinator for Public Health, added                                                            
that theoretically  it  could be possible.  Just as  a minor  can be                                                            
cited  for smoking,  a vendor  could be  cited for  selling  tobacco                                                            
products  to a  minor. Enforcement  is  carried out  with local  law                                                            
enforcement  using established  protocols  that involve  the use  of                                                            
real ID  cards and in no  way tries to trick  the vendor.  Even with                                                            
that protocol  in place there is up to 60 percent  non-compliance in                                                            
rural areas and 34 percent in urban areas.                                                                                      
                                                                                                                                
Side B                                                                                                                          
                                                                                                                                
CHAIRMAN  THERRIAULT asked  whether the section  6 provisions  would                                                            
apply if a minor used a  fake ID to purchase tobacco and alcohol and                                                            
was subsequently apprehended.                                                                                                   
                                                                                                                                
MR. SASSOR said  that scenario is the same as under  current law and                                                            
this bill doesn't  affect current statutes. The magistrate  or judge                                                            
would have discretion to  determine whether the clerk had sufficient                                                            
knowledge or should have known that the ID was false.                                                                           
                                                                                                                                
SENATOR PHILLIPS  requested an explanation of the  $1.5 million loss                                                            
in federal grants.                                                                                                              
                                                                                                                                
MR. SASSOR explained  there is federal law referred  to as the Synar                                                            
amendment that  holds hostage the federal block grant  for substance                                                            
abuse  treatment. If  the  compliance checks  are  conducted and  if                                                            
youth are  successful in  purchasing tobacco  products more  than 20                                                            
percent of the time, the  state is in non-compliance and the penalty                                                            
is  $1.4 million,  40  percent of  the  state block  grant.  Several                                                            
months ago, Congress  passed a law that provided for  an alternative                                                            
penalty  and  that is  that  if you  are  a state  that  is in  non-                                                            
compliance  and  you put  in  an amount  of  money for  the  tobacco                                                            
enforcement  program  that will  be  accepted in  lieu  of the  $1.5                                                            
million penalty.  Therefore, for the  amount of the fiscal  note the                                                            
$1.5 million penalty is avoided.                                                                                                
                                                                                                                                
This makes  sense as a business expense  because a $487,000  cost to                                                            
the state is  less than a $1.5 million  cost. From the department's                                                             
perspective,  this bill  will provide  an enforcement  program  that                                                            
will make it possible to avoid the penalties in the future.                                                                     
                                                                                                                                
SENATOR PHILLIPS  asked how the 20 percent is measured  and who does                                                            
the measuring.                                                                                                                  
                                                                                                                                
MR. LINDSTROM  responded that compliance checks were  mandatory as a                                                            
condition  of receiving the  block grant and  they have to  select a                                                            
random  sample of  retail businesses  that sell  tobacco. There  are                                                            
about 1,700 existing endorsements  for selling tobacco and about 400                                                            
of those outlets  had to be randomly  selected and sampled  and that                                                            
becomes the basis for the annual sample.                                                                                        
                                                                                                                                
CHAIRMAN THERRIAULT  asked how the bill interacts  with the proposed                                                            
operating budget  because the loss  of the grant funds were  made up                                                            
in the operating budget  and through the passage of this legislation                                                            
the $1.5  wouldn't be  lost. He asked  if those  funds would  be put                                                            
back in general fund.                                                                                                           
                                                                                                                                
MR. LINDSTROM  said neither  the House nor  the Senate included  the                                                            
request from DHSS of the  additional $1.5 million to offset the loss                                                            
in the budget.  Instead, Representative Harris brought  forward this                                                            
legislation  and in the absence of  this legislation and  the fiscal                                                            
note  there  would  be a  reduction  to  the program  base  of  $1.5                                                            
million.  There is no increment  in the House  of Senate version  of                                                            
the budget to replace these dollars.                                                                                            
                                                                                                                                
CHAIRMAN THERRIAULT  asked whether there were any  more questions or                                                            
anyone else to testify. There was no response.                                                                                  
                                                                                                                                
There was no prepared CS and no amendments from the committee.                                                                  
                                                                                                                                
He asked for the will of the committee.                                                                                         
                                                                                                                                
SENATOR  DAVIS moved  HB  28 and  four  attached fiscal  notes  from                                                            
committee with  individual recommendations. There  was no objection.                                                            
                                                                                                                                
CHAIRMAN THERRIAULT  anticipated taking final action  on HB 96 after                                                            
the floor session.                                                                                                              
                                                                                                                                
The meeting was recessed to the call of the Chair at 4:50.                                                                      
                                                                                                                                
                  HB  96-ACQUIRING JESSE LEE HOME                                                                           
                                                                                                                                
CHAIRMAN THERRIAULT  called the meeting  back to order at  6:45 p.m.                                                            
Present were Senators Davis, Phillips and Chairman Therriault.                                                                  
                                                                                                                                
He explained  that the original  bill as it  come to the  committee,                                                            
presupposed  that the state  would acquire  the home and develop  it                                                            
for historic  value.  The redrafting  does not  presuppose that  the                                                            
state  would purchase  the home.  It does  ask for  the state  to be                                                            
involved  in  the assessment  of  how  the home  can  be  preserved,                                                            
developed and managed in the future.                                                                                            
                                                                                                                                
Page 2, section  2(b) is not needed  because it asks for  options if                                                            
the state  did  not purchase.  It is  unneeded because  there is  no                                                            
longer any presupposition the state will purchase the home.                                                                     
                                                                                                                                
He noted the presence of staff for the prime sponsor.                                                                           
                                                                                                                                
HELEN DONOHUE,  staff to  Representative Lancaster,  said they  have                                                            
reviewed the changes to the bill and have no objections.                                                                        
                                                                                                                                
CHAIRMAN THERRIAULT  asked for questions or other  amendments. There                                                            
were none.                                                                                                                      
                                                                                                                                
He noted the fiscal note from DNR dated April 1, 2001.                                                                          
                                                                                                                                
He asked for the will of the committee.                                                                                         
                                                                                                                                
SENATOR DAVIS  moved CS CSHB 96(STA) and fiscal note  from committee                                                            
with individual recommendations. There were no objections.                                                                      
                                                                                                                                
CHAIRMAN THERRIAULT adjourned the meeting at 6:45 p.m.                                                                          

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