HOUSE FINANCE COMMITTEE February 8, 1995 1:30 P.M. TAPE HFC 95-18, Side 1, #000 - end. TAPE HFC 95-18, Side 2, #000 - 683. CALL TO ORDER Co-Chair Mark Hanley called the House Finance Committee meeting to order at 1:34 p.m. PRESENT Co-Chair Hanley Representative Kohring Co-Chair Foster Representative Martin Representative Mulder Representative Navarre Representative Brown Representative Parnell Representative Grussendorf Representative Therriault Representative Kelly ALSO PRESENT Jan Rutherdale, Department of Law; George Bingham, State Farm Insurance; Patty Swenson, Staff, Representative Bunde; Geron Bruce, Legislative Liaison, Department of Fish and Game; Jack Chenoweth, Attorney, Legislative Legal Services. SUMMARY HB 9 An Act relating to recovery of damages from a minor's parent or legal guardian when property is destroyed by the minor. HB 9 was HELD in Committee for further discussion. HB 58 An Act establishing the Chickaloon Flats Critical Habitat Area. CSHB 58 (res) was reported out of Committee with a "do pass" recommendation and with a zero fiscal note by the Department of Fish and Game, dated 2/3/95. HOUSE BILL NO. 58 "An Act establishing the Chickaloon Flats Critical Habitat Area." PATTY SWENSON, STAFF, REPRESENTATIVE BUNDE testified in 1 support of HB 58. She noted that the legislation is accompanied by a zero fiscal note from the Department of Fish and Game. She explained that the purpose of HB 58 is to establish the Chickaloon Critical Habitat Area. She asserted that the designation will protect the waterfowl habitat in Cook Inlet. She emphasized that, in the Fall, up to 25,000 birds use this area daily. She added that the area is used by hunters who access the area by float plane, boat and four wheel drive vehicles. Ms. Swenson stressed that "critical habitat" is the least restrictive of all land designations. She stated that the uses specified in the legislation are compatible and will continue. She noted that there are no oil and gas leases presently in the area. She observed that the legislation received support from various groups during the House Resources Committee hearings. In response to a question by Representative Kohring, Ms. Swenson noted that the designation will be permanent. She reiterated that the area is heavily used by waterfowl. GERON BRUCE, LEGISLATIVE LIAISON, DEPARTMENT OF FISH AND GAME stressed the importance of the area as a wildlife habitat. Representative Kohring noted that the area would remain open to oil and gas activity. Mr. Bruce stated that the designation would provide that the area is managed primarily to protect critical fish and wildlife habitat. Other uses are permitted as long as they are compatible to the protection of the habitat. He noted that pipelines runs through some critical habitats. He stressed that of 212 applications for special area permits in critical habitats, refuges and sanctuaries only two were denied. The area would be open to multiple use with the caveat that the uses be consistent with the protection of fish and wildlife. In response to a question by Representative Kelly, Mr. Bruce clarified that Department of Fish and Game's staff will make the determinations of compatible use in regards to permit applications. Representatives Kelly and Parnell expressed concern that the guiding criteria of "compatible use" is open to broad interpretation. Mr. Bruce stressed that it is not the intention of the Department to prohibit hunting or harvesting of fish and wildlife. He pointed out that the legislation is designed to provide protection to the environment which supports fish and wildlife population for use by citizens. 2 In response to a question by Representative Grussendorf, Mr. Bruce emphasized that the Department of Fish and Game works with applicants to allow requested activities in a manner which will not damage the habitat. A permit is denied only if there is no way to allow an activity without damage to the habitat. Representative Brown asked how the designation changes the land management. Mr. Bruce reiterated that the designation makes the protection of the fish and wildlife habitat the primary purpose for which the land is managed. Mr. Bruce further explained that oil and gas activities would be permitted on a site specific basis if the activity does not endanger the habitat's ability to support waterfowl. The area has not been offered for oil and gas leases during the past five years. Representative Kelly asked if the area is currently threatened. Ms. Swenson stated that the impact due to high population growth in the Anchorage area is the greatest concern. Mr. Bruce added that concerned individual's who use the area want to assure that it remains healthy for future generations of Alaskans to enjoy. He noted that Alaska's population grew by 40 percent from 1979 - 1992. The Department of Labor projects a further 40 percent increase in population over the next fifteen years. Representative Navarre MOVED to report CSHB 58 (RES) out of Committee with individual recommendations and with the accompanying fiscal note. CSHB 58 (RES) was reported out of Committee with a "do pass" recommendation and with a zero fiscal note by the Department of Fish and Game, dated 2/3/95. HOUSE BILL NO. 9 "An Act relating to recovery of damages from a minor's parent or legal guardian when property is destroyed by the minor." Representative Therriault, the sponsor of HB 9, noted that the legislation updates statutes written in 1957. He explained that the legislation is intended to encourage responsibility among parents and juveniles and to provide recourse for victims who have lost property. The legislation is based on the principal that parents or legal guardians of juveniles who cause damages should be monetarily responsible for the loss. Representative Therriault recounted instances of vandalism 3 in Fairbanks schools. The legislation would increase the amount a victim may recover from $2.0 to $10.0 thousand dollars. The legislation also includes unintentional damages that may be caused as a result of the intentional action. He added that HB 9 allows part or all of the individuals permanent fund dividend to satisfy a judgement. Representative Grussendorf expressed concern that $10.0 thousand dollars may be a little on the high side. Representative Therriault thought that the national average that a victim may recover is between $10.0 to $15.0 thousand dollars. He noted that revision of Alaska statutes in 1967 increased the recoverable amount from $500 hundred dollars to $2.0 thousand dollars. He emphasized the effect of inflation. Representative Mulder spoke in support of the increased recovery amount. He noted that his vehicle was stolen in the past year by minors. He recalled that the damage was $13.0 to $14.0 thousand dollars. He was limited to recovery of $2.0 thousand dollars. He observed that the minor was involved in other thefts after the incident. In response to a question by Representative Brown, Representative Therriault explained that a minor's and their parent's permanent fund dividends could be garnished. He observed that the dollar amount in existing statute is being amended. The mechanism is not being changed. Permanent fund dividend checks could be garnished in consecutive years to pay the recovery judgement. By statute victims would be allowed up to $10.0 thousand dollars in recovery upon judgement from the court. A victim could petition the court for a higher settlement. Representative Brown asked the effect of changing the language on page 1, lines 10 and 11 from "maliciously or wilfully" to "as a result of a knowing or intentional act". Representative Therriault used the example of an intentional act of vandalism which leaves windows broken and subsequently all the pipes in the house freeze. The vandal would be responsible for the damage resulting from the frozen pipes. He noted that all the terms are defined in criminal law. He noted that "malicious" and "wilful" pre- date the 1978 criminal code revision. Representative Parnell questioned if the Committee wants to make a person who has no custody or oversight rights responsible for recovery. Representative Therriault stressed that he did not intend to change current statutes which determine who costs can be recovered from. He observed that the State, as the entity of custody, would be 4 exempt. Representative Grussendorf asked if a joy rider would be responsible for damages incurred after a car that was taken was discarded. JAN RUTHERDALE, DEPARTMENT OF LAW advised that the joy rider would be responsible for damage occurring to the vehicle before it was returned to its owner. She noted that, but for the actions of the joy rider, further damage would not have happened. She emphasized that the victim needs to be recovered. Representative Martin noted the high rate of separated and divorced families. He expressed concern that responsibility be pin pointed to the parent that has custody of the minor at the time of the act. Representative Therriault reiterated his desire to see the issue of custody addressed in separate legislation. Representative Brown asked if the court would have jurisdiction to determine what is the most appropriate recovery under the circumstances. Ms. Rutherdale observed that "or person having legal custody" is not meant to limit the phrase "parents". Discussion ensued in regards to the courts ability to determine who recovery will be judged against. Representative Parnell expressed support for an amendment which would allow the court to determine who should be responsible for any given point in time. Representative Brown noted that a child could be visiting a parent who does not have legal custody when the act occurs. The legal guardian or parent may not have any control over the incident. Ms. Rutherdale noted that the victim can seek recovery from either or both parents or person(s) having legal custody. The court cannot determine who should provide recovery. (Tape Change, HFC 95-18, Side 2) GEORGE BINGHAM, STATE FARM INSURANCE thought that the court's decision includes the determination of who will pay recovery. He did not know the percentage of claims involving minors pursued by the State Farm Insurance Company. He stressed the effort involved in collection for $2.0 thousand dollars. Representative Brown noted that $10.0 thousand dollars could be a hardship on poor families. Representative Therriault 5 stressed the hardship placed on the victim. Co-Chair Hanley observed that the amount of recovery was raised in 1967 to $2.0 thousand dollars. He accentuated the impact of $2.0 thousand dollars in 1967. He noted that recovery is being expanded to include "as a result of". In addition, statutes governing permanent fund dividend attachments are being revised to allow satisfaction of the judgement. JACK CHENOWETH, ATTORNEY, LEGISLATIVE LEGAL SERVICES clarified that the determination of who will be recovered is independent of the amount recovered. He explained that the plaintiff may bring action against the minor's father, mother or both. Suit can also be brought against the legal guardian or person having legal custody. If the suit is brought against both parents and recovery awarded the plaintiff may seek redress from either or both to pay up to the ceiling established in statute through joint or several liability. Mr. Chenoweth thought that the minor could be sued directly. In lieu or in addition to suing the minor the damaged party can look to the minor's parents, legal guardian or person having legal custody. Representative Navarre noted that the judge does not have discretion to limit who the suit can be brought against. Mr. Chenoweth stated that the plaintiff determines the identity of the defendant. If the defendant does not have legal custody then the parent having legal custody could be pled into the suit. Representative Martin noted that most parents would have an insurance policy. Representative Foster recognized the high number of rural children who are being cared for by relatives other than their parents. Representative Brown observed that "person having legal custody" stands alone, as an independent source from which recovery could take place. She added that "custody" does not modify "parent". Mr. Chenoweth agreed with her observation. Co-Chair Hanley noted that a plaintiff could seek redress from both parents and the person having legal custody. Mr. Chenoweth clarified that if formal adoption has not taken place the relative taking care of the minor cannot be recovered against. 6 Representative Therriault emphasized that the decision to birth a child brings responsibilities. Co-Chair Hanley acknowledged concern by committee members that the person or persons who has legal custody should be the responsible party. Representative Martin reiterated that the minor may commit the action while under supervision of a parent having visitation rights. He stressed that the person(s) having responsibility of the minor "at the time" of the act should be responsible. Co-Chair Hanley reiterated concerns detailed by committee members. Mr. Chenoweth noted that some of the members' concerns could be addressed through an amendment setting out responsibility in regards to custody. Representative Therriault reiterated his desire to address the member's concerns in separate legislation. He emphasized that he is attempting to raise the recovery ceiling not the mechanism. He stressed the complexity of statutes governing the mechanism of recovery. Representative Martin stressed the need to reflect current societal needs in statute. Representative Brown asked what is involved in establishing paternity. Mr. Chenoweth observed that there is no technical definition of "parent." The biological father of a child could be included in a suit if their parenthood was established in a paternity proceeding. Representative Kelly MOVED to refer HB 9 to a subcommittee. Representative Navarre asked if recovery could be prioritized. Mr. Chenoweth agreed that recovery could be prioritized. He restated that a parent whose child had been adopted would not be responsible for recovery. The adoptive parent would be substituted for the biological parent in terms of any legal action. Representative Therriault restated that his intent to change the dollar amount associated with recovery, not the mechanism involved. Representative Therriault MOVED to report CSHB 9 (JUD) out of Committee with individual recommendations and with the accompanying fiscal notes. Representative Kelly WITHDREW his motion to refer HB 9 into a subcommittee. Representative Brown OBJECTED to the motion to move CSHB 9 (JUD) from Committee. She stressed that the issues of responsibility rises to a level of debate due to the increased dollar amount and ability to attach permanent fund dividend checks. She suggested that the bill be held for further consideration. Co-Chair Foster agreed that changes 7 in society warrant changes in statutes. Representative Therriault WITHDREW his motion to move CSHB 9 (JUD) from Committee. Co-Chair Hanley noted that HB 9 would be rescheduled for Friday, February 17, 1995. HB 9 was HELD in Committee for further discussion. ADJOURNMENT The meeting adjourned at 3:00 p.m. 8