HOUSE FINANCE COMMITTEE April 24, 1996 1:50 P.M. TAPE HFC 96-135, Side 1, #000 - end. TAPE HFC 96-135, Side 2, #000 - end. TAPE HFC 96-136, Side 1, #000 - #351. CALL TO ORDER Co-Chair Mark Hanley called the House Finance Committee meeting to order at 1:50 p.m. PRESENT Co-Chair Hanley Representative Martin Co-Chair Foster Representative Mulder Representative Brown Representative Grussendorf Representative Parnell Representative Kelly Representative Therriault Representative Kohring Representative Navarre was absent from the meeting. ALSO PRESENT Representative Joe Green; Mark Boyer, Commissioner, Department of Administration; Duane Buell, Juneau; Helen Merhrkens, Department of Education; Wendy Redmond, Vice President, University of Alaska; Brett Huber, Staff, Senator Green; Del Smith, Deputy Commissioner, Department of Public Safety; Tess Lanum, Alaska PTA; Ed Knoebel, Glenallen, Patrick Gullufsen, Assistant Attorney General, Department of Law. SUMMARY HB 545 An Act relating to the cost-of-living differential for certain public employees residing in the state and the criteria for determining eligibility for the differential; and providing for an effective date. CSHB 545 (FIN) was reported out of Committee with a "do pass" recommendation and with three zero fiscal notes by the Department of Administration, the Department of Revenue, and the Department of Transportation and Public Facilities, all dated 3/22/96. 1 SB 80 An Act relating to police protection service areas in unified municipalities; and to police protection provided by the state in certain municipal areas. SB 80 was rescheduled to another time. SB 177 An Act relating to permits to carry concealed handguns. HCS CSSB 177 (FIN) was reported out of Committee with a "do pass" recommendation and with a fiscal impact note by the Department of Public Safety, dated 4\11\96; a zero fiscal note by the Department of Corrections, dated 3/26/96; and a zero fiscal note by the Department of Law, dated 3/6/96. SCR 29 Objecting to the Department of Administration's settlement with certain employees of the Alaska marine highway system. SCR 29 was rescheduled to another time. HOUSE BILL NO. 545 "An Act relating to the cost-of-living differential for certain public employees residing in the state and the criteria for determining eligibility for the differential; and providing for an effective date." PAT GULLUFSEN, ASSISTANT ATTORNEY GENERAL, DEPARTMENT OF LAW noted that HB 545 was introduced by the Administration in order to clarify the definition of residency for Cost of Living Differentials (COLD) for Alaska Marine Highway employees. He observed that HB 545 adopts the permanent fund dividend definition of resident for purposes of the COLD. The definition was altered by the insertion of "temporarily" as requested by the Administration. The House State Affairs Committee also deleted from the temporarily allowable allowances exemptions for serving in Congress or the Peace Corps. He noted that HB 545 clarifies that the criteria is not subject to bargaining under the Public Employees Retirement Act (PERA). The legislation also gives the Commissioner of Administration the authority to clarify and implement the criteria by regulation. He noted that this is similar to the authority of the Commissioner of the Department of Revenue in relation to the permanent fund dividend. Mr. Gullufsen noted that the Department of Administration has proposed an amendment, Amendment 1 (copy on file). The 2 amendment would set the differential rate by statute. The rate is currently subject to negotiation. The rate would be set based on a recent study of COLD by the Division of Personnel. The Director of Personnel would have the authority to adjust the rate according to studies demonstrating the cost of living in Alaskan communities and Bellingham, Washington. Adjustments would be subject to annual legislative review. Co-Chair Hanley stressed that the intent is to clarify in statute that the criteria for residency will not be negotiable. MARK BOYER, COMMISSIONER, DEPARTMENT OF ADMINISTRATION referred to a two page chronological listing of COLD events (copy on file). He noted that COLD was implemented in 1980 and became active in 1982. He observed that PERA directed that the State have a cost of living differential. It does not specify the amount or criteria of the differential. He emphasized that the dispute over COLD payments began in 1989. Historically the amount of the COLD and the criteria for qualification have been settled through negotiation. He maintained that COLD is part of the negotiation package. He observed that it was initiated to entice out-of-state employees to come to Alaska for residency. The original amount was 22.5 percent which was the same as the federal cost of living allowance at the time. He maintained that the real cost of living differential between Seattle and Southeastern communities are negligible and should be reviewed. Commissioner Boyer observed that the Administration has asked that COLD criteria be placed in statute. He emphasized that contracts that do not contain the criteria could be reopened if the legislation is enacted to deal with COLD criteria. If this fails the criteria will be in place the next time the contracts are negotiated. Co-Chair Hanley summarized that the two contracts currently before the Legislature for ratification would not be affected. Commissioner Boyer noted that the Marine Engineer's Beneficial Association (MEBA) will be under negotiation in the fall. In response to comments by Representative Martin, Commissioner Boyer emphasized that the problem was not created by the current Administration. He stressed that there are a number of programs that require residency. Mr. Gullufsen stated that the court has not recognized a definite set of criteria under the COLD statute. He observed that COLD statutes, AS 23.42.10, states "for 3 employees residing in the state of Alaska. He noted that there are statutes for establishing residency for voting purposes. Mr. Gullufsen noted that an arbitrator determined that time spent working on a vessel in Alaskan waters can be counted toward residency. He stressed that the legislation proposes language that would clarify that the criteria will be the same as the State has always thought was the criteria. He stated that if the legislation is enacted the State will argue that the criteria applies now to everybody except MEBA which has other agreed to criteria. He clarified that the MEBA agreement would apply permanent fund dividend regulations. Commissioner Boyer noted that the problem began when COLD was initiated. Administrations since 1989 have recognized the need to set criteria through regulation. He reviewed events outlined on Attachment 1. He summarized that there was not adequate criteria. Co-Chair Hanley noted that the current Administration could have adopted regulations. He added that discussions were held on this issue during the 3/20/96, House Finance Committee meeting. Commissioner Boyer recounted negotiations during the previous year. Co-Chair Hanley asked for copies of arbitrator's decisions. Discussion occurred regarding the responsibility of the Administration and Legislature in regards to the failure to implement criteria. Representative Mulder asked if the legislation would result in a uniform, consistent COLD format. Commissioner Boyer clarified that the legislation only applies to the marine units. Commissioner Boyer reiterated that Amendment 1 would take COLD criteria outside of the bargaining process. Representative Mulder expressed support for Amendment 1. Co-Chair Hanley asked if Amendment 1 would be consistent with other legislation. Commissioner Boyer stated that it would be consistent with other legislation. Co-Chair Hanley summarized that the legislation would provide that new contracts would not be negotiated. The criteria and rates set by the legislation would be enacted and become statute. Commissioner Boyer added that the rates would be reviewed every five years after a study is 4 completed. In response to a question by Co-Chair Hanley, Commissioner Boyer explained that IBU members tie ships off. Employees at ferry terminals are GGU and SSU members. The person who ties up the ships receives a COLD of 18 to 22 percent. On shore personnel receive a fraction of this amount. Mr. Gullufsen observed that the State was told that COLD criteria needed to be bargained in order to be applied. Under PERA disputes must go to an arbitrator. The State has challenged the arbitrator's ruling in court. He emphasized that accept where the State has set down to permissively negotiate criteria the State has the authority as a public employer to propagate criteria without negotiation. Co-Chair Hanley asked if there is a penalty section in the legislation. Mr. Gullufsen explained that there are no specific penalty provisions in the statute. He emphasized that employees can be dismissed and required to return COLD payments that they should not have received. He stated that criminal prosecution is possible if false physical evidence is given. Co-Chair Hanley stated that there should be some penalty specifically associated with false resident claims. Mr. Gullufsen stated that there is a criminal penalty provision stated on the form. (Tape Change, HFC 96-135, Side 2) Representative Martin asked if the same penalties for falsifying permanent fund dividend applications could apply. Mr. Gullufsen did not think the same penalties could apply unless they were included in the legislation. He stated that it would not complicate or harm things to have specific criminal provision with regards to false claims of residency for COLD purposes. In response to a question by Representative Martin, Mr. Gullufsen stated that it would be difficult to impose on the union the responsibility to report the true residence of their members. Commissioner Boyer pointed out that employees sign a form to certify their Alaskan residency. He noted that the new form will embrace the criteria. All members of MEBA will have to recertify under the new criteria. The Alaska Marine Highway system will submit the forms to the Permanent Fund Dividend Division. Representative Mulder MOVED to adopt Amendment 1. There being NO OBJECTION, it was so ordered. Commissioner Boyer noted that the rates included in Amendment 1 reflect the 5 1994, Runzheimer study. The study recommended a 14 percent differential for Ketchikan and a 7 percent differential for Kodiak. These were adjusted in Amendment 1. Co-Chair Hanley summarized that the rates if enacted would be adopted for any new contracts until a new study is completed. The Director of Personnel would implement new rates by regulations after the next study is completed. The regulations would be subject to legislative review. Commissioner Boyer clarified that the bench mark should be Bellingham since operations were moved there from Seattle. He emphasized that rates will be subject to legislative input. Representative Brown observed that the amendment would state that there is no difference in the cost of living in Juneau or Anchorage and Bellingham, Washington. Commissioner Boyer noted that the Runzheimer study contained an error range of -3.5 - +3.5. Commissioner Boyer reiterated that the Legislature can change or modify rates placed by regulations. There being NO OBJECTION, Amendment 1 was adopted. Co-Chair Foster MOVED to report CSHB 545 (FIN) out of Committee with individual recommendations and with the accompanying fiscal notes. There being NO OBJECTION, it was so ordered. CSHB 545 (FIN) was reported out of Committee with a "do pass" recommendation and with three zero fiscal notes by the Department of Administration, the Department of Revenue, and the Department of Transportation and Public Facilities, all dated 3/22/96. SENATE BILL NO. 177 "An Act relating to permits to carry concealed handguns." BRENT HUBER, STAFF, SENATOR GREEN testified on behalf of SB 177. He provided the Committee with written testimony (copy on file). He maintained that SB 177 will revise the current concealed handgun program to provide a more streamlined and less costly process. Mr. Huber provided members with a sectional analysis of SB 177 (copy on file). He reviewed the sectional analysis. He noted that the sponsor has provided an amendment that would remove subsections 1(e) and 11(a). Subsection 1(a) would 6 provide an affirmative defense for AS 11.61.210 that would allow permit holders to carry concealed weapons on school grounds providing that they did not exit a propelled vehicle. He stressed that the sponsor has tried to find language that would allow permit holders the opportunity to pick up or drop off their children at school. The sponsor was not able to find language that was agreeable to opponents and recommends the deletion of the existing language. TESS LANUM, VICE PRESIDENT ON LEGISLATION, ALASKA STATE PARENT/TEACHERS ASSOCIATION testified via the teleconference network. (Ms. Lanum's written remarks are on file.) She stated that Alaska PTA agrees with the removal of subsections 1(e) and 11(a). She asked that the original law regarding concealed weapons on school property remain in place. Representative Kelly noted that subsection 11(a) of work draft, 9-LS1139\S, 4/22/96, states that concealed handguns may not be carried on to school grounds or a school bus "other than while in a propelled vehicle, other than a school bus, and the permittee does not exit the vehicle". Ms. Lanum spoke in opposition to the language in 11(a). WENDY REDMOND, VICE PRESIDENT, UNIVERSITY OF ALASKA spoke in support of deleting subsections 1(e) and 11(a). She observed that University of Alaska classrooms are not covered by the legislation since they are not included under the definition of "schools." She requested that concealed handguns be excluded from University of Alaska campus grounds or facilities except as provided by the Board of Regents policy. She noted that the Board of Regents currently allow guns on campus. There are secure places in each dorm for gun storage. Guns are allowed in locked cars. The University of Alaska does not support the policy of concealed weapons in classrooms. She emphasized that campuses are well protected. There are commissioned officers on campuses. She added that security forces and lighting have been increased. REPRESENTATIVE JOE GREEN stated that he is opposed to allowing concealed handguns on schools. He expressed support for the elimination of subsections 1(e) and 11(a). He stressed that if protection is needed that other measures should be taken. HELEN MERHRKENS, STATE BOARD OF EDUCATION noted that the Board unanimously opposes the concept of allowing concealed handguns on school grounds. She noted that the Board believes that all conditions directly related to the safety and health of public school students and staff are of utmost 7 importance. She added that the Board opposes concealed weapons in state operated public libraries. Representative Kelly asked Ms. Merhrkens for the rationale behind her objections. Ms. Merhrkens stated that testimony from parents indicated concern that there with guns on school property. She stated that parents do not want guns on school grounds unless they are part of an organized event. She stated that someone who brings a concealed handgun in a vehicle may illegally get out of the car with their gun. Representative Kelly expressed support for the ability of parents to carry concealed weapons in their cars on school grounds. He maintained that it would be a benefit to have parents with guns on school grounds in the case of an incident. Ms. Merhrkens stated that their preference is for trained law enforcement officers to respond to incidents on school grounds. Representative Martin noted the use of guns in rural areas. Ms. Merhrkens noted that the use of rifle ranges would not be prohibited under current law. (Tape Change, HFC 96-136, Side 1) Representative Kelly summarized that a handgun can be carried in the trunk if it is unloaded. DUANE BUELL, JUNEAU testified in SB 177. He stated that he supports any provision that relaxes restrictions on concealed handguns. He noted that permit holders from other states have to meet qualifications in their states. He asserted that "not one of the horror stories that (the Department of) Public Safety advanced as being a consequence of passing a concealed carry bill has come true in the last 16 months." He pointed out that the process assures that permit holders are law abiding responsible persons. He stressed that he wants the ability to defend himself if the need arises. He spoke against restrictions. Representative Kohring echoed the remarks of Mr. Buell. Representative Brown stated that a permittee can carry their weapon in a holster, unconcealed, in most of the areas that concealed weapons can not be carried. Mr. Buell argued that those that carry weapons in the open are a target for criminals. Mr. Huber noted that AS 11.61.220 A(4)(a) allows all unloaded firearms to be carried in a trunk or encased in a closed container in a motor vehicle. He clarified that 8 concealed handguns would be included under this provision. In response to a question by Representative Brown, Mr. Huber discussed section 3. He noted that current law prohibits anyone from carrying concealed handguns anyplace that has a beverage dispensary license. This includes restaurants. He noted that permit holders want to be able to go out to lunch with their weapons. He observed that there is no clear differentiation between restaurants and bars. He stated that it is already against the law and in statute to possess a firearm while intoxicated. He maintained that concealed handgun permit holders should be able to go in and out of normal businesses. He stressed that under an affirmative defense the defendant would have to prove that they have not consumed alcohol in the 8 hours previous to carrying a concealed weapon. He noted that a blood alcohol level of below .04 percent is the same as commercial driver's license. The first detectable level is .02 percent. Representative Brown noted that a loaded firearm could be concealed in a place where liquor is sold. Mr. Huber stated that the exception is for a loaded firearm in the possession of a permit holder who has not consumed or has no blood alcohol level greater than .04 percent. Mr. Huber explained that an affirmative defense states that the laws of the section pertain, however, an allowable exception is given if proof is made that the terms of the exception are met. He noted that the Department of Law did not support a direct offense. The burden of proof would be on the permit holder. Representative Brown asked if this provision would encourage persons to violate the law. Mr. Huber noted that one of the requirements for obtaining a permit is that the permittee have a clear explanation and study of the laws that pertain to the program. Representative Brown referred to subsections 11 (4) and (5). She asked why the existing language was deleted. Mr. Huber noted that testimony stressed that the firearm properly possessed by the permit holder is safer in their direct control than left in a car outside of their control. He maintained that permit holders are the most law abiding and responsible citizens. In response to a question by Representative Brown, Mr. Huber noted that subsection 11(8) received the most public testimony. Deletion of subsection 11(8) would allow concealed weapons to be carried in financial institutions or banks. He maintained that permit holders want to carry concealed weapons as protection to and from banks. 9 Representative Martin MOVED to adopt Amendment 1 (copy on file). Amendment 1 would provide that concealed handguns be excluded from the University of Alaska campus grounds or facilities except as provided by the Board of Regents policy. There being NO OBJECTION, it was so ordered. Representative Mulder MOVED to adopt committee substitute, Work Draft, 9-LS1139\S, dated 4\22\96 as amended by Amendment 1 (copy on file). Mr. Huber discussed changes in the committee substitute. Section 3 was changed to include the blood alcohol level. A blanket prohibition on health care providing facilities was deleted. He noted that individual facilities can set their own policy regarding concealed handguns. He added that reciprocity provisions were changed. There being NO OBJECTION, Work Draft, 9-LS1139\S, dated 4\22\96 as amended by Amendment 1 was adopted. Representative Mulder MOVED to adopt Amendment 2, 9- LS1139\S.1 (copy on file). Amendment 2 would delete "other than while in a propelled vehicle, other than a school bus, and the permittee does not exit the vehicle." Representative Kelly expressed opposition to Amendment 2, but acknowledged that there is strong support for the amendment among opponents of concealed handguns. Mr. Huber stated that the legislation would remain silent in regards to any provisions regarding schools with the adoption of Amendment 2. The current law disallowing concealed handguns on school property would remain. Representative Kelly noted that handguns could be carried unloaded in a trunk or container. In response to a question by Representative Mulder, Mr. Huber noted that if another state is honoring Alaska's permit, Alaska would honor their permit. He emphasized that other states also provide for a criminal background check and finger printing information. He noted that training provisions differ from state to state. Representative Mulder expressed concern that other states provide the same protection. DEL SMITH, DEPUTY COMMISSIONER, DEPARTMENT OF PUBLIC SAFETY stated that he understood that other states would have to be as stringent as Alaska for reciprocity to exist. Co-Chair Foster MOVED to report HCS CSSB 177 (FIN) out of Committee with individual recommendations and with the accompanying fiscal notes. 10 Representative Brown OBJECTED for purposes of discussion. She maintained that handguns are a threat to our children. She asserted that the proliferation throughout society is troubling and a threat. She thought it was a mistake to expand areas concealed weapons can be carried. Representative Brown WITHDREW her Objection. There being NO OBJECTION, HCS CSSB 177 (FIN) was reported out of Committee. Representative Kohring maintained that expansion of handguns will provide greater safety to law abiding citizens. HCS CSSB 177 (FIN) was reported out of Committee with a "do pass" recommendation and with a fiscal impact note by the Department of Public Safety, dated 4\11\96; a zero fiscal note by the Department of Corrections, dated 3/26/96; and a zero fiscal note by the Department of Law, dated 3/6/96. ADJOURNMENT The meeting adjourned at 4:00 p.m. 11