Legislature(1997 - 1998)

05/10/1998 01:45 PM Senate TRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
           SENATE TRANSPORTATION COMMITTEE                                     
                     May 10, 1998                                              
                      1:45 p.m.                                                
                                                                               
MEMBERS PRESENT                                                                
                                                                               
Senator Jerry Ward, Chairman                                                   
Senator Gary Wilken, Vice Chair                                                
Senator Lyda Green                                                             
Senator Rick Halford                                                           
                                                                               
MEMBERS ABSENT                                                                 
                                                                               
Senator Georgianna Lincoln                                                     
                                                                               
COMMITTEE CALENDAR                                                             
                                                                               
CS FOR HOUSE BILL NO. 482(TRA) am                                              
"An Act relating to registration of vehicles owned by disabled                 
persons or persons who are 65 years of age or older; and providing             
for an effective date."                                                        
                                                                               
     - MOVED CSHB 482(TRA) OUT OF COMMITTEE                                    
                                                                               
CS FOR HOUSE BILL NO. 12(FIN) am                                               
"An Act relating to civil liability for commercial recreational                
activities and certain skating and cycling activities; and                     
providing for an effective date."                                              
                                                                               
     - MOVED SCSCSHB 12(TRA) OUT OF COMMITTEE                                  
                                                                               
HOUSE JOINT RESOLUTION NO. 67                                                  
Relating to renewal of the bilateral aviation agreement concerning             
the mandatory Anchorage stopover for Russian carriers on                       
transpacific routes between the Russian Far East and the United                
States.                                                                        
                                                                               
     - MOVED HJR 67 OUT OF COMMITTEE                                           
                                                                               
HOUSE JOINT RESOLUTION NO. 63                                                  
Relating to support for Mitchell Field Adak airport.                           
                                                                               
     - MOVED HJR 63 OUT OF COMMITTEE                                           
                                                                               
CS FOR HOUSE BILL NO. 386(FIN)                                                 
"An Act relating to the financing authority, programs, operations,             
and projects of the Alaska Industrial Development and Export                   
Authority; and providing for an effective date."                               
                                                                               
     - MOVED SCSCSHB 386(TRA) OUT OF COMMITTEE                                 
                                                                               
PREVIOUS SENATE ACTION                                                         
                                                                               
HB 482 - No previous Senate committee action.                                  
                                                                               
HB 12 - No previous Senate committee action.                                   
                                                                               
HJR 63 - See Transportation minutes dated 4/30/98.                             
                                                                               
HJR 67 - See Transportation minutes dated 4/30/98.                             
                                                                               
HB 386 - See Transportation minutes dated 4/28/98 and 4/30/98.                 
                                                                               
WITNESS REGISTER                                                               
                                                                               
Peter Ecklund                                                                  
Legislative Aide to Representative Williams                                    
Alaska State Capitol                                                           
Juneau, Alaska  99801-1182                                                     
POSITION STATEMENT:  Testified for sponsor of HB 482                           
                                                                               
Juanita Hensley                                                                
Chief, Driver Services                                                         
Department of Administration                                                   
P.O. Box 10200                                                                 
Juneau, Alaska  99811-0200                                                     
POSITION STATEMENT:  Supports HB 482                                           
                                                                               
Representative Gary Davis                                                      
Alaska State Capitol                                                           
Juneau, Alaska  99081-1182                                                     
POSITION STATEMENT:  Sponsor of HB 12                                          
                                                                               
Connie Jones                                                                   
Municipality of Anchorage                                                      
P.O. Box 196650                                                                
Anchorage, Alaska  99501                                                       
POSITION STATEMENT:  Supports HB 12                                            
                                                                               
Russ Winner                                                                    
Alaska Action Trust                                                            
900 West 5th Avenue  #700                                                      
Anchorage, Alaska  99501                                                       
POSITION STATEMENT:                                                            
                                                                               
Keith Laufer                                                                   
Alaska Industrial Development and Export Authority                             
480 West Tudor                                                                 
Anchorage, Alaska  99503                                                       
POSITION STATEMENT:                                                            
                                                                               
                                                                               
ACTION NARRATIVE                                                               
TAPE 98-11, SIDE A                                                             
                                                                               
CHAIRMAN WARD called the Senate Transportation Committee meeting to            
order at 1:45 p.m.  Present were Senators Green, Wilken and                    
Chairman Ward.  The first order of business before the committee               
was HB 482.                                                                    
                                                                               
           CSHB 482(TRA) - MOTOR VEHICLE REGISTRATION                          
                                                                               
Peter Ecklund, staff to Representative Williams, sponsor of HB 482,            
explained the bill allows senior citizens and handicapped citizens             
the ability to get a lifetime registration for their vehicles.  At             
present, those citizens pay no annual fee to register one vehicle              
per person.  Instead of requiring the participants to register the             
vehicle annually, they will only have to register the vehicle once.            
The bill will streamline the workload for the Division of Motor                
Vehicles (DMV), and be more convenient for participants.                       
                                                                               
JUANITA HENSLEY, DMV, Department of Administration, stated HB 482              
strongly supports HB 482 as it will help the 14,000 senior citizens            
in the state who qualify for the exemption, and the 6,000                      
individuals who are registered with handicap license plates.                   
                                                                               
SENATOR GREEN asked if DMV issues handicap license plates for                  
people with temporary disabilities.                                            
                                                                               
MS. HENSLEY explained DMV issues a temporary handicap placard for              
people who meet the federal requirements if a physician verifies               
that the person needs the temporary placard.  HB 482 will not apply            
to those individuals.                                                          
                                                                               
SENATOR GREEN moved CSHB 482(TRA) out of committee with individual             
recommendations and its zero fiscal note.  There being no                      
objection, the motion carried.                                                 
                     HJR 63 - ADAK AIRPORT                                     
                                                                               
CHAIRMAN WARD read Representative Moses' sponsor statement into the            
record and announced his intention to hold HJR 63 in committee at              
this time.                                                                     
                                                                               
             HJR 67 - AIR FLIGHTS RUSSIAN FAR EAST                             
                                                                               
PETER ECKLUND, legislative aide to Representative Williams, stated             
the committee was provided with background information on the                  
legislation at its last meeting, and that he was available to                  
answer questions.                                                              
                                                                               
CHAIRMAN WARD announced his intention to hold HJR 67 in committee              
at this time.                                                                  
                                                                               
        CSHB 12(FIN) am - IMMUNITY FOR EQUINE ACTIVITIES                       
                                                                               
REPRESENTATIVE GARY DAVIS, sponsor of HB 12, described the bill as             
follows.  HB 12 establishes the responsibilities and liability of              
owners, operators, and users of commercial recreational activities             
for injuries occurring from certain skating and cycling activities.            
The legislation is supported by many groups.  The bill was amended             
on the House floor to include the liabilities and responsibilities             
of municipal cycling and skating facilities.  He informed committee            
members he has prepared a proposed amendment to correct technical              
changes that need to be made to the bill resulting from the House              
floor amendment.                                                               
                                                                               
Number 131                                                                     
                                                                               
CONNIE JONES, representing the Municipality of Anchorage (MOA),                
stated the MOA has been working on similar legislation for about               
five years and is very interested in seeing this bill pass. MOA                
believes this is a fair way to demonstrate the responsibilities of             
both the user and the operator of commercial recreational                      
facilities.   HB 12 does not entirely relieve municipalities of                
liability; it requires municipalities to construct and maintain a              
municipal skating or cycling facility in a manner that is not                  
negligent.  The Youth Commission, The Anchorage Chamber of                     
Commerce, the Municipal Assembly, the Downtown Anchorage                       
Association, and the municipal government support this legislation.            
The MOA currently has $83,000 available from bonds and an                      
appropriation from the Assembly to build a skateboard park which it            
very much wants to do, but will not until this legislation passes.             
                                                                               
Number 158                                                                     
                                                                               
RUSS WINNER, representing the Alaska Action Trust, gave the                    
following testimony on what it views as the two aspects of HB 12:              
commercial recreational activity and skateboarding and cycling.                
The Alaska Action Trust believes this legislation is unnecessary               
for three reasons.  First, litigation in this area is uncommon, and            
it is doubtful the litigation that has occurred has had any effect             
on the growth of the industry.  Second, current Alaska law provides            
for allocation of fault to the plaintiff, based on his or her                  
acceptance of the obvious risks of the activity.  Third, the                   
Legislature enacted tort reform legislation last year.  That                   
legislation contained caps on compensation for pain and suffering,             
non-economic damages and punitive damages, and it broadened the                
ability of a defendant to allocate fault to persons who are not                
litigants.  Further protections in this area are unnecessary.  The             
Alaska Action Trust suggests that the Legislature wait and see what            
effect the new tort reform legislation has on liability for                    
injuries.  The Alaska Action Trust assumes the purpose of this                 
legislation is to reduce insurance rates for the operators of                  
commercial recreational activities, however it is unlikely that                
insurance rates will be affected by HB 12.  Insurance rates are set            
by companies on a region wide basis and the particular statutes                
enacted in Alaska will have little, if any, effect on insurance                
rates.  Instead, insurance companies will look at the loss record              
for the region.  One provision of HB 12 states that a customer of              
commercial recreational activities is contributorily negligent to              
the extent that the inherent risk of the activity causes his/her               
harm.  The Alaska Action Trust questions whether establishing a                
policy that says that the user is negligent to the extent that                 
he/she chooses to participate in the activity will result in poor              
public relations between this industry and tourists and visitors               
from out of state.                                                             
                                                                               
MR. WINNER pointed out inconsistent and confusing language in the              
bill could invite litigation.  Section .010 refers to liabilities              
to the operator for "inherent risks".  Section .030 requires                   
participants to learn about the "risks".  Section .040 requires the            
operator to explain the "fundamental inherent risks."  He                      
questioned whether the participant is to learn about the inherent              
risks or a broader category of risks and whether all three types of            
risks are the same.  Also, the bill requires participants to learn             
about the risks but does not explain how they are to learn, or from            
whom, nor does the bill address the effect on the allocation of                
fault if the participant does not learn. The bill imposes certain              
responsibilities on operators, such as explaining the fundamental              
inherent risks of the activity.  Once again, the  bill is silent as            
to how, and by whom, this explanation is to occur.  Also, the                  
effect of having provided an explanation is not clear, therefore               
litigation over the significance of that requirement could occur.              
This legislation appears to be special interest legislation and its            
constitutionality would be subject to attack for that reason.  He              
cited the case of Turner v. Scales as a case in which the Supreme              
Court struck down similar special interest legislation as                      
unconstitutional.                                                              
                                                                               
MR. WINNER stated the skating and cycling provisions in HB 12 are              
similar to the Alaska's ski statutes, AS 05.35.040, but contain                
significant differences.  The ski statute grants certain qualified             
immunity to ski operators only if they meet certain operational                
requirements.  The ski operator must have an operating plan, a ski             
patrol, and a policy for removing reckless skiers.                             
                                                                               
Number 273                                                                     
                                                                               
CHAIRMAN WARD informed committee members that several options for              
HB 12 are available.  The committee could adopt the original bill              
which only pertains to equine activities.  That option will require            
a resolution to change the title.  The second option is to work on             
the bill as is.                                                                
                                                                               
Number 281                                                                     
                                                                               
SENATOR WILKEN moved to adopt the proposed amendments prepared by              
Representative Davis.                                                          
                                                                               
SENATOR GREEN asked if it would be appropriate for the committee to            
adopt the earlier version and bypass the need for the resolution.              
                                                                               
SENATOR WILKEN asked what version the committee is working from.               
                                                                               
CHAIRMAN WARD clarified the Senate Transportation Committee                    
substitute in members' packets is the original bill introduced by              
Representative Davis and pertains to equine activities only.  If               
committee members want to deal with the original bill, the                     
committee will have to adopt a Senate concurrent resolution to                 
change the title.                                                              
                                                                               
Number 304                                                                     
                                                                               
SENATOR WILKEN asked if CSHB 12(TRA)am (F.a version) is an active              
version.                                                                       
                                                                               
REPRESENTATIVE DAVIS explained that version was passed by the                  
House.                                                                         
                                                                               
SENATOR WILKEN asked if Representative Davis' proposed amendments              
were to CSHB 12(TRA)am.                                                        
                                                                               
REPRESENTATIVE DAVIS said they are.                                            
                                                                               
Number 312                                                                     
                                                                               
SENATOR HALFORD commented a good portion of that bill creates an               
exemption from liability for a municipal entity for doing the same             
thing as a private entity.  He asked why an exemption is justified             
for one and not the other.                                                     
                                                                               
REPRESENTATIVE DAVIS replied the section relating to commercial                
recreational activities refers to private entities and does not                
include municipalities.                                                        
                                                                               
SENATOR HALFORD asked if the general liability limitation on                   
commercial outdoor activities would apply to a private skateboard              
facility.                                                                      
                                                                               
REPRESENTATIVE DAVIS said that is his understanding.                           
                                                                               
SENATOR HALFORD maintained the effect of the bill will be to create            
an exemption for private outdoor activities and for municipal                  
skating and cycling facilities.                                                
                                                                               
CHAIRMAN WARD stated that is why a title change will be necessary              
if the committee chooses to limit the exemption to equine                      
activities.                                                                    
                                                                               
CHAIRMAN WARD announced the motion to adopt Representative Davis'              
proposed amendments was before the committee, and that he objected             
to that motion.                                                                
                                                                               
SENATOR WILKEN asked Chairman Ward why he was objecting.                       
                                                                               
CHAIRMAN WARD said he wanted to have a discussion as to whether the            
committee should adopt the original bill instead of letting CSHB
12(TRA)am be the instrument that provides public funding for                   
insurance for a sport.                                                         
                                                                               
Number 353                                                                     
                                                                               
REPRESENTATIVE DAVIS clarified the proposed amendments only relate             
to the CSHB 12(TRA)am version, therefore if the motion carries, the            
committee will still have the option of addressing any version of              
the legislation.                                                               
                                                                               
CHAIRMAN WARD said he was unsure whether he wanted to give any                 
consideration at all to CSHB 12(FIN)am.  He asked Representative               
Davis if the version of HB 12 that passed the House does what he               
originally intended it to do.                                                  
                                                                               
REPRESENTATIVE DAVIS said it does, but because of the machinations             
of liability legislation, he tried to address a specific issue                 
rather than a collective issue.                                                
                                                                               
CHAIRMAN WARD noted he would like to get HB 12 in a form that the              
committee is willing to pass out.                                              
                                                                               
SENATOR HALFORD asked Chairman Ward if he maintained his objection             
to adopt the Senate Transportation Committee substitute.                       
                                                                               
CHAIRMAN WARD removed his objection to adopting the proposed                   
amendments.                                                                    
                                                                               
    CSHB 386(FIN) - RE AK INDUS. DEVELOP & EXPORT AUTHORITY                    
                                                                               
SENATOR HALFORD moved to adopt SCSCSHB 386(TRA), version R, as the             
working document of the committee.                                             
                                                                               
SENATOR WILKEN objected.                                                       
                                                                               
CHAIRMAN WARD explained the Anchorage International Airport project            
was removed from Version R because that project was contained in               
another piece of legislation that has already been signed by the               
Governor.  Also, Version R increases the bonding amount by $5.5                
million for the City of Whittier access project.                               
                                                                               
SENATOR WILKEN noted on page 13, line 18, the word "may" was                   
changed to "shall" which will have to be corrected.                            
                                                                               
SENATOR GREEN questioned whether the word "may" should be changed              
throughout the bill.                                                           
                                                                               
SENATOR WILKEN replied the word "may" should be used throughout the            
bill.                                                                          
                                                                               
CHAIRMAN WARD clarified that a motion to adopt Version R as the                
working document was before the committee.                                     
                                                                               
SENATOR WILKEN asked what version, other than Version R, was before            
the committee.                                                                 
                                                                               
CHAIRMAN WARD answered version P is the active document.                       
                                                                               
SENATOR WILKEN noted version P also contains the word "shall".  He             
removed his objection to adopting version R.                                   
                                                                               
CHAIRMAN WARD indicated the amount on line 9, page 13, needs to be             
changed from $70,000,000 to $28,000,000 for the railroad right-of-             
way at Denali.                                                                 
                                                                               
SENATOR GREEN moved to change the amount on line 9, page 13 from               
$70,000,000 to $28,000,000.                                                    
                                                                               
Number 418                                                                     
                                                                               
MR. JOE FIELDS, testifying via teleconference from Fairbanks,                  
stated the version of the bill he was reading from contained                   
$70,000,000 for the Point MacKenzie Project on page 13, line 9.                
                                                                               
CHAIRMAN WARD explained he and the Co-Chair of the Senate Finance              
Committee determined that $28,000,000 will accomplish the work that            
needs to be completed, and he clarified that the section the motion            
referred to pertains to the Denali railroad project.   He announced            
the motion to reduce the amount to $28 million was adopted with no             
objection.                                                                     
                                                                               
SENATOR WILKEN asked Mr. Fields if he is comfortable with the $28              
million for the Stampede Trail project.                                        
                                                                               
MR. FIELDS said he thought it was a good starting point and that               
the number is accurate.                                                        
                                                                               
CHAIRMAN WARD clarified the Finance Co-Chair calculated that                   
amount.                                                                        
                                                                               
CHAIRMAN WARD announced the public participation portion of the                
hearing on HB 386 was completed.                                               
                                                                               
SENATOR WILKEN asked to hear from a representative of AIDEA on the             
"shall" clause.                                                                
                                                                               
MR. KEITH LAUFER, AIDEA, responded it has been typical for bond                
authorizations for the Development Finance Program to contain the              
word "may" because a number of statutory requirements apply to the             
program and must be fulfilled before bonds can be issued.  The word            
"shall" in this context could negate the other statutory                       
requirements and leaves the committee's intent unclear.  He pointed            
out the word "shall" is also included in the section that pertains             
to the interest rate as it must be offered.  As it appears, the                
project would be a taxable project as opposed to tax exempt, and               
the bill suggests there is to be an interest rate subsidy for the              
project, which is contrary to the normal parameters of the program.            
                                                                               
CHAIRMAN WARD asked if any of the concerns Mr. Laufer mentioned are            
against the law.                                                               
                                                                               
MR. LAUFER replied the Legislature makes the law.                              
                                                                               
SENATOR HALFORD asked if the difference between taxable financing              
and exempt financing is 1.5 percent.                                           
                                                                               
MR. LAUFER said it is about 2 percent.                                         
                                                                               
SENATOR HALFORD said in all cases, the projects are public use                 
facilities, but the projects to be owned by AIDEA will be financed             
at the tax exempt rate.                                                        
                                                                               
MR. LAUFER replied the tax rules vary as to which projects can be              
tax exempt.  All projects under AIDEA's Development Finance Program            
are to be owned by the Authority, whether or not specifically                  
stated in the bill.  The approval under Section 172 requires that              
the Authority own it.  Ownership in and of itself does not make a              
project tax exempt, however.                                                   
                                                                               
Number 486                                                                     
                                                                               
SENATOR HALFORD asked what the expected interest rate is for the               
DeLong Mountain project, the City of Nome project, and the Point               
MacKenzie project.  He stated he is curious about how the interest             
rate computation works.                                                        
                                                                               
MR. LAUFER answered the Authority typically looks at the rate at               
which it issues bonds for a project and charges a spread above that            
to cover the Authority's cost of operations in order to pay the                
dividend to the state.  Under the Internal Revenue Code, ports                 
owned by governmental entities can qualify for tax exempt                      
financing, so for those projects, the tax exempt rate plus the                 
appropriate spread would be applied.                                           
                                                                               
SENATOR HALFORD asked about the DeLong Mountain project.                       
                                                                               
MR. LAUFER stated that is also a port project.                                 
                                                                               
SENATOR HALFORD asked if the interest rate on the other portion of             
the DeLong Mountain project was subsidized.                                    
                                                                               
MR. LAUFER said not that he was aware of, although he believed that            
was the first project under the program and the State gave a direct            
equity contribution to that project.                                           
                                                                               
SENATOR HALFORD said essentially, that project was financed with a             
subsidy.                                                                       
                                                                               
MR. LAUFER said the subsidy was not from the Authority, it was from            
the State.                                                                     
                                                                               
Number 482                                                                     
                                                                               
SENATOR GREEN questioned whether project labor agreements are part             
of AIDEA's overall plan.                                                       
                                                                               
MR. LAUFER stated AIDEA has never used a project labor agreement.              
The project proponents of the Alaska Seafood Center have elected to            
use a project labor agreement.  They are doing the construction                
themselves; AIDEA has not controlled that process.  AIDEA has                  
agreed to take out their interim financing in the event that they              
meet a number of conditions in the building's construction,                    
otherwise AIDEA has taken no position as to whether project labor              
agreements are a good idea or not.                                             
                                                                               
SENATOR GREEN asked whether AIDEA has the ability to impact whether            
companies use project labor agreements.                                        
                                                                               
MR. LAUFER said at this stage it does not.  The only thing AIDEA               
has done in regard to controlling procurement was to require that              
the Alaska Seafood Center group use a competitive process and an               
Alaska bidders and products preference.  With that exception, the              
Alaska Seafood Center group took the entire construction financing             
risk.  If the project is not completed within budget and on time,              
and there is not enough money in the bank at the end of the                    
process, AIDEA is not required to take out any financing or to                 
purchase the building.                                                         
                                                                               
Number 511                                                                     
                                                                               
SENATOR GREEN asked if there is any way the Legislature could                  
prevent that from happening in the future or whether there is a                
necessity to do that.                                                          
                                                                               
MR. LAUFER said he was not aware of any necessity, and that there              
are always ways the Legislature can control any contracting process            
AIDEA goes through.  He noted he understood bills pertaining to                
project labor agreements were going through the Legislature at one             
time but he was unsure of the status of those bills.                           
                                                                               
SENATOR GREEN said she does not believe the Legislature should be              
putting money into projects that are restricted by project labor               
agreements.                                                                    
                                                                               
MR. LAUFER indicated AIDEA follows the state procurement process               
unless a project is specifically exempted, therefore any                       
legislative changes could be directed toward that process.                     
                                                                               
SENATOR HALFORD questioned whether AIDEA gives no preference for or            
against any stage of the approval, based on the existence or                   
absence of a project labor agreement.                                          
                                                                               
MR. LAUFER said that is correct.                                               
There being no further discussion, CHAIRMAN WARD recessed the                  
meeting to the call of the chair at 2:15 p.m.                                  
                                                                               
[THE FOLLOWING PORTION OF THE MEETING WAS NOT RECORDED]                        
                                                                               
CHAIRMAN WARD reconvened the Senate Transportation Committee                   
meeting at 6:55 p.m.  Present were Senators Halford, Green, and                
Chairman Wilken.                                                               
                                                                               
    CSHB 386(FIN) - RE AK INDUS. DEVELOP & EXPORT AUTHORITY                    
                                                                               
SENATOR HALFORD moved SCSCSHB 386(TRA), Version R, out of committee            
with individual recommendations.  There being no objection, the                
motion carried.                                                                
                                                                               
             HJR 67 - AIR FLIGHTS RUSSIAN FAR EAST                             
                                                                               
SENATOR GREEN moved HJR 67 out of committee with individual                    
recommendations and its accompanying fiscal note.  There being no              
objection, the motion carried.                                                 
                                                                               
                     HJR 63 - ADAK AIRPORT                                     
                                                                               
SENATOR HALFORD moved to adopt SCSHJR 63(TRA) and pass it out of               
committee with individual recommendations.  There being no                     
objection, the motion carried.                                                 
                                                                               
        CSHB 12(FIN) am - IMMUNITY FOR EQUINE ACTIVITIES                       
                                                                               
SENATOR GREEN moved SCSCSHB 12(TRA) out of committee with                      
individual recommendations and its accompanying fiscal note.  There            
being no objection, the motion carried.                                        
                                                                               
CHAIRMAN WARD adjourned the meeting at 6:57 p.m.                               

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