MINUTES{PRIVATE }   SENATE FINANCE COMMITTEE   22 April 1997   5:00 p.m.    TAPES    SFC-97, Tap 122, Sides A and B [NOTE: The first part of the meeting on Side A of Tape 122 is double-recorded or corroded, as well as most of Side B; parts of the meeting are difficult to distinguish accurately.] CALL TO ORDER Senator Bert Sharp, Co-chair, convened the meeting at approximately 5:00 p.m. PRESENT In addition to Co-chair Sharp, Senators Pearce, Parnell, Torgerson, Phillips, Donley, and Adams were present. ALSO ATTENDING: Tuckerman Babcock, Staff, Senator Lyda Green, Sponsor; Senator Lyda Green; Dean Guaneli, Department of Law; Senator Tim Kelly; Marianne Burke, Director, Division of Insurance, Department of Commerce and Economic Development. SUMMARY INFORMATION SB 104 OMNIBUS INSURANCE REFORM CSSB 104(FIN) was REPORTED out of committee with "no recommendation" and fiscal note by the Department of Revenue and zero impact note by the Department of Commerce and Economic Development. SB 141 CONCEALED HANDGUN PERMITS/FIREARM POSSESS CSSB 141 (FIN) was REPORTED out of committee with "no recommendation" and previously published fiscal note by the Department of Public Safety and previously published zero impact note by the Department of Public Safety. SENATE BILL NO. 141   "An Act relating to permits to carry concealed handguns; and relating to the possession of firearms." Co-chair Sharp provided history of the bill in committee. Senator Phillips MOVED to ADOPT Amendment 1. Co-chair Sharp OBJECTED for discussion. Senator Phillips explained that under current law, a homeowner had to post a sign on their property warning that concealed weapons were not allowed in the home or on the property. The amendment would delete the requirement of the homeowner to post the sign. Instead, the person carrying the concealed weapon would be required to notify the homeowner of the weapon and ask for permission to enter. Senator Parnell opined that the amendment went beyond the description offered and the intent of the sponsor. Co-chair Sharp explained the amendment. The OBJECTION was MAINTAINED. A roll call was taken on the motion. IN FAVOR: Adams, Phillips, Pearce, Sharp OPPOSED: Torgerson, Parnell, Donley The motion PASSED (4/3). Amendment 1 was adopted. Co-chair Sharp noted that Amendment 2 would not be offered. Senator Adams MOVED to ADPOPT Amendment 3. Senator Adams explained that the amendment would clearly describe the penalty and avoid a double standard. Senator Pearce OBJECTED to the amendment, which she thought changed the intent of the bill. Senator Adams questioned restrictions. TUCKERMAN BABCOCK, STAFF, SENATOR LYDA GREEN, SPONSOR, explained that Amendment 3 would extend gun control by restricting where people could go with open or concealed weapons. He stated that the sponsor wanted people who committed a Class A misdemeanor after getting the permit to lose the right to get another permit ever again. He pointed to Section 18.65.740(a)(2). He stated that Senator Green proposed an amendment to version X of the bill that would delete (Section 17, page 8) the repealer of AS 18.65.749(a)(2). Anyone who committed a Class A misdemeanor after a conviction would lose the right to carry a concealed weapon. He pointed to a March 24 memo to the committee from legal counsel listing who could not carry. He noted that the amendment did not deal with who could carry but where a person could carry. He agreed that the provision would be more appropriate to another piece of legislation. In response to a question by Senator Parnell, Mr. Babcock responded that the current situation in Alaska law was that the court system had interpreted the constitutional provisions allowing the court system to control firearms in court houses and had an administrative order to that effect. Senator Parnell asked what a person caught in a courthouse would be prosecuted under. Mr. Babcock did not know. DEAN GUANELI, DEPARTMENT OF LAW, testified that there were two possibilities for dealing with a gun in a courtroom. One possibility was that a person could be arrested and prosecuted for criminal trespass if the person was told to leave and refused. More commonly, a judge who saw a gun in a courtroom would simply hold the person in contempt of court, and use the contempt powers. He referred to a case that went to the Alaska Supreme Court over twenty years prior involving a person who came into a courtroom with a gun; the judge held the person in contempt of court, and established the inherent power to control the courtroom through contempt powers. Senator Parnell asked whether the state could proscribe carrying weapons in state offices. Mr. Babcock replied that under current law, anyone could carry openly in state office buildings. Senator Parnell questioned whether the state had the power to post a particular building against carrying open or concealed weapons. Mr. Babcock replied that the legislature had never provided the state with the authority for open carry; only permitted concealed carry was banned under current law. Mr. Guaneli reported that an opinion had been written by the attorney general several years prior regarding the authority to post signs and prohibit certain activity, including carrying concealed weapons. He added that the opinion of the Department of Law was that anyone could post a sign in a public building, including the state. In a building open to the public, however, a posted sign was not effective to prosecute someone with criminal trespass. The person would have to go into the building, be told to leave, and refuse to leave. The mere posting of the sign gave people notice that they were not supposed to be there, but would not allow them to be arrested. The posted sign would not effectively prohibit a person from carrying weapons. Senator Parnell asked whether buildings were currently posted against carrying open or concealed weapons. He referred to the distinction made by the sponsor between open and concealed weapons. Mr. Guaneli did not believe buildings were posted at that time. He pointed out that each building manager dealt with security problems as they arose; if they saw someone walking into a building with a gun, they would call the security guard. The fear was not knowing when someone was carrying a concealed weapon. Senator Parnell asked what facilities providing protection to victims of domestic violence or sexual assault could do to prevent open or concealed weapons from being brought into a shelter. Mr. Babcock replied that the shelter would be able to post a sign that would apply equally to carrying open or concealed weapons. The sign could advise people that it would be a violation of the law to enter the premises and that a person refusing to leave would be criminally trespassing. He did not know whether such a person would be prosecuted as a Class A or a Class B misdemeanor. Mr. Guaneli noted that domestic violence facilities were private and not generally open to the public. The posting of the sign in a private facility was enough in and of itself to allow a person to be charged with an offense; it was not technically required that the person be told to leave and then refuse to leave, as was required in public buildings. SENATOR LYDA GREEN, SPONSOR, wanted to redirect focus. She maintained that the legislation was about permitting and permit- holders. She did not think it mattered what was posted or what the law was. She thought a person who was determined to do mischief would not get a permit, would not ask permission, and would not be concerned about a sign on a building. The bill was intended to focus on people who felt they needed personal protection in their daily lives. Senator Parnell asked what weapons were allowed or not allowed on a school bus, and queried the applicable provision; he pointed to the mention of school buses in the amendment. Mr. Babcock did not know the purpose of the restriction. He stated that on school grounds and in schools, the written permission of the school administrator was required for adults. Children going to school did not need permission if they were in a shooting or rifle club at school. Senator Phillips queried federal or state laws regarding prohibition against a permit holder possessing a concealed weapon, especially regarding where. Mr. Babcock replied that the Department of Public Safety was trying to acquire the list of federal restrictions. He listed the places he was familiar with [where a person could not carry concealed]: all federal buildings and buildings in which there were federal offices, airports, correction facilities, state and federal courthouses, state correctional facilities, and school grounds. He also included any private entity that wished to post a sign forbidding firearms. Senator Phillips concluded that the repealer was essentially covered by federal law. Mr. Babcock agreed that it was covered either by federal law, or by Mr. Guaneli's explanation of how a state office could post, or by criminal trespass for a private building. He stated that the purpose of the bill was to treat people who were permitted the same way as people who carry openly. The OBJECTION to Amendment 3 was MAINTAINED. A roll call vote was taken on the motion. IN FAVOR: Adams, Phillips OPPOSED: Donley, Torgerson, Parnell, Pearce, Sharp The motion FAILED (5/2). Amendment 3 was not adopted. Senator Donley MOVED to ADOPT Amendment 4, to delete language pertaining to the repealer, on page 8, line 6 [18.65.740(a)(2)]. He explained that the deleted portion stipulated that a person getting a misdemeanor after getting a permit would lose the permit: the "permit to carry concealed handgun shall be immediately revoked by the department when the permittee is convicted of two Class A misdemeanors of this state or similar laws of another jurisdiction within a five-year period if at least one of the convictions occurs after". Co-chair Sharp queried Class A misdemeanors, and was told that examples included drunk driving, fourth-degree assaults (generally without a weapon), a number of drug offenses (including possession of more than one-half pound of marijuana), and some theft offenses. He noted that it was the general misdemeanor-level offense that applied to a wide range of conduct. There being no OBJECTION, Amendment 4 was adopted. Senator Donley queried treatment of offenders with misdemeanor offenses involving violent conduct. Senator Green responded [unintelligible]. Senator Pearce MOVED to REPORT CSSB 141 (FIN) out of committee with individual recommendations and the accompanying fiscal note. There being NO OBJECTION, it was so ordered. CSSB 141 (FIN) was REPORTED out of committee with "no recommendation" and previously published fiscal note by the Department of Public Safety and previously published zero impact note by the Department of Public Safety. SENATE BILL NO. 104   "An Act relating to regulation and examination of insurers and insurance agents; relating to kinds of insurance; relating to payment of insurance taxes and to required insurance reserves; relating to insurance policies; relating to regulation of capital, surplus, and investments by insurers; relating to hospital and medical service corporations; relating to the portability and availability of health care insurance; making amendments to the insurance statutes to conform to federal requirements regarding health insurance; relating to the repeal of certain small employer health care insurance provisions; requiring that uninsured and underinsured motor vehicle insurance apply to claims of an insured even if other policy limits are not exhausted; repealing delayed provisions relating to dental, vision, and hearing insurance in secs. 3 and 4, ch. 101, SLA 1992; repealing delayed provisions relating to small employer health care insurance in secs. 4, 7, 9, and 12, ch. 39, SLA 1993; repealing the delayed effective date in sec. 5, ch. 101, SLA 1992, and in sec. 13, ch. 39, SLA 1993; and providing for an effective date." Co-chair Sharp provided a history of the bill in committee. Senator Donley MOVED to ADOPT Amendment 1. There was an OBJECTION for discussion. Senator Donley explained that cases in other states had raised potential problems related to rental car insurance; the purpose of the amendment was to prevent litigation. The amendment would clarify the hierarchy of claims when a rental car was damaged. The first place a claim would go would be the collision policy purchased when someone rented a car and purchased collision; the second place would be the operator of the car, if they had a policy; the third place would be the owner of the rental-car company. Most people believed the listed order was already required in current law, but litigation in other states had shown that the claim order was not always clear. Senator Donley informed the committee that he had sponsored language in existing law eight years prior that stipulated that an auto insurance policy in Alaska required coverage of rental cars. The amendment was consistent with the original language to prevent litigation. Senator Torgerson asked why Canada was listed in the provision. Senator Donley answered that the language was in existing law. In response to a question by Co-chair Sharp, Senator Donley explained how the legislation would work: If a person renting a car bought a collision waiver, the collision policy would be the first thing covering damage costs. If a person did not buy a collision waiver, and the person's auto insurance covered rental cars, then that would be the next in line. The person who rented the car out would be responsible if the renting person had neither of the first two options. Co-chair Sharp summarized that the person who owned the rental car would be liable if the person renting the car did not buy additional coverage and did not have it themselves. Senator Donley agreed. [SFC-97, Tape 122, Side B] Senator Donley noted that the issue was not completely clear in other states. Under the old law, a person with uninsured or underinsured motorist coverage would have a policy up to a certain amount; the only way the person could file a claim under such a policy was if there was a claim and compensation did not cover the whole amount of the damages. Because of overlap with other policies and because Alaska had mandatory auto insurance, the system only worked if someone without insurance caused the accident. Anyone with insurance had coverage. He believed that people were confused about the coverage. The law had been changed to clarify that if one person was in an accident resulting in damages of $125,000 with a second person who had $100,000 worth of insurance, the policy of the second person would pay $100,000 and the policy of the first person would pay the $25,000 balance. Senator Donley continued that there was a section in another statute [AS 28.22.020(1)(a)] that was not modified. The presence of the conflicting statute enabled the insurance companies to go to federal court and get a ruling that the legislature did not mean what it said. The federal court determined that the protection did not have to be paid for. The ruling was appealed up to the ninth circuit to get it back to the state court, where it should have been in the first place. At the same time, there was another case that resulted in the opposite ruling-that the legislature meant what it said. In other words, one case said pay, the other said not to pay; some insurance companies in Alaska had to pay, and some did not. The amendment would clarify the issue and establish that the payment should be stacked. Senator Donley articulated the policy arguments on both sides. On the one hand, the argument was that stacked policies became more expensive. SENATOR TIM KELLY reported that the Rules Committee had sponsored the bill at the request of the Division of Insurance. He did not object to Amendment 2. He stated that he understood the public policy call. He did not believe Amendment 1 belonged in the bill, however. MARIANNE BURKE, DIRECTOR, DIVISION OF INSURANCE, DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT, testified that Senator Donley had succinctly described the issue, which was controversial and long-standing. She affirmed that there were two court rulings and that the attorney general's office had filed a brief supporting the provision. The division supported the brief and concurred with it. However, she noted that the issue was highly controversial and asked that the amendment [Amendment 1] not be attached to the bill. She stressed that there were convincing and strong arguments either way. She stated that both the original SB 104 and the Kassenbaum-Kennedy amendment were deliberately structured to be as non-controversial as possible, because the bill was critical to Alaska. Co-chair Sharp noted the OBJECTION to Amendment 1. Ms. Burke emphasized that an amendment as controversial as the proposed amendment could kill the bill. She stressed that the bill had to go through during the current session or the Kassenbaum-Kennedy (the federal regulation) effective date would start. Senator Kelly asked whether the controversial issue had been introduced on its own merits. Senator Donley replied that it had not been introduced during the current year. A roll call was taken on the motion. [The answers were difficult to hear on the tape, which was double-recorded with another meeting. The answer of Senator Parnell was unclear and the outcome regarding Amendment 1 unclear.] IN FAVOR: Phillips, Donley, Adams OPPOSED: Torgerson, Pearce, Sharp Senate Pearce MOVED to REPORT SB 104 (FIN) out of committee with individual recommendations and the accompanying fiscal note. There being NO OBJECTION, it was so ordered. CSSB 104(FIN) was REPORTED out of committee with "no recommendation" and fiscal note by the Department of Revenue and zero impact note by the Department of Commerce and Economic Development. ADJOURNMENT    The meeting was adjourned at approximately 6:30 p.m.