Legislature(1999 - 2000)

05/14/1999 03:10 PM Senate FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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 CS FOR HOUSE BILL NO. 40(FIN) am                                                                                               
"An Act merging certain departments in the executive                                                                            
branch of state government; changing the names of                                                                               
certain departments in the executive branch of state                                                                            
government; transferring duties among departments and                                                                           
offices in the executive branch of state government;                                                                            
providing that certain discretionary duties formerly                                                                            
performed by the Department of Community and Regional                                                                           
Affairs are mandatory in the department to which those                                                                          
duties are transferred; relating to the licensing of                                                                            
child care facilities; relating to the division of                                                                              
vocational rehabilitation; relating to the Alaska                                                                               
Human Resource Investment Council; adjusting the                                                                                
membership of certain multi-member bodies; providing                                                                            
that a certain commissioner may designate department                                                                            
employees to serve in the commissioner's place on a                                                                             
board, council, or similar entity; providing for                                                                                
advice to be given by a department head to the                                                                                  
governor and other commissioners on the delivery of                                                                             
government services to rural areas and providing for                                                                            
recommendations to be made to the governor and other                                                                            
commissioners by that same commissioner about policy                                                                            
changes that would affect rural governments and rural                                                                           
affairs; relating to the federal community development                                                                          
quota program; eliminating references to the division                                                                           
of tourism; eliminating a reference to manpower                                                                                 
training programs; eliminating references to the                                                                                
director and deputy director of international trade;                                                                            
eliminating the requirement for a local advisory                                                                                
committee for consideration of rural electrification                                                                            
loans; and providing for an effective date."                                                                                    
                                                                                                                                
This was the second hearing for this bill in the Senate                                                                         
Finance Committee. In the previous hearing, a committee                                                                         
substitute, 1-LS0056/N, 5/11/99, was moved for adoption and                                                                     
then withdrawn.                                                                                                                 
                                                                                                                                
Amendment #1: This amendment places the Statewide                                                                               
Independent Living Council under the authority of the                                                                           
Department of Labor and Workforce Development as                                                                                
established elsewhere in this legislation. It changes                                                                           
Section 77 of the bill to read:                                                                                                 
                                                                                                                                
Sec. 47.80.300. Statewide independent living                                                                                    
council. There is established the Statewide                                                                                     
Independent Living Council. For budgetary purposes.                                                                             
the council is located in the Department of Labor and                                                                           
Workforce Development [EDUCATION]. The Department of                                                                            
Labor and Workforce Development [EDUCATION] shall                                                                               
provide reasonable and necessary professional and                                                                               
technical assistance when requested by the council.                                                                             
                                                                                                                                
Senator Randy Phillips moved for adoption.  Co-Chair John                                                                       
Torgerson advised the Committee that he submitted this                                                                          
amendment on behalf of Administration and that it is a                                                                          
technical amendment intended to conform to changes made the                                                                     
bill by the other body.                                                                                                         
                                                                                                                                
MIKE KRIEBER, staff to Representative Vic Kohring testified                                                                     
that the Representative had reviewed and does support the                                                                       
amendment.                                                                                                                      
                                                                                                                                
The amendment was ADOPTED without objection.                                                                                    
                                                                                                                                
Amendment #2: This amendment makes the following changes to                                                                     
the bill.                                                                                                                       
                                                                                                                                
Page 52, lines 18 -23:                                                                                                          
Delete:                                                                                                                         
"(a) A loan committee consisting of five                                                                                        
[SEVEN] members is established.  The committee is                                                                               
composed of [THE COMMISSIONER OF COMMUNITY AND                                                                                  
REGIONAL AFFAIRS,] the commissioner of community                                                                                
[COMMERCE] and economic development, the director                                                                               
of management and budget, or the designees of the                                                                               
commissioner [COMMISSIONERS] or the director, and                                                                               
three [FOUR] public members."                                                                                                   
Insert:                                                                                                                         
"(a) A loan committee consisting of five                                                                                        
[SEVEN] members is established. The committee is                                                                                
composed of the executive director of the Alaska                                                                                
Industrial Development and Export Authority                                                                                     
[COMMISSIONER OF COMMUNITY AND REGIONAL AFFAIRS,                                                                                
THE COMMISSIONER OF COMMERCE AND ECONOMIC                                                                                       
DEVELOPMENT], the director of management and                                                                                    
budget, or the designees of the executive                                                                                       
director [COMMISSIONERS] or the director, and                                                                                   
three (FOUR] public members.                                                                                                    
Sec. 48. AS 42.45.060(c) is amended to read:                                                                                    
(c) The executive director of the Alaska                                                                                        
Industrial Development and Export Authority                                                                                     
(COMMISSIONER OF COMMUNITY AND REGIONAL AFFAIRS]                                                                                
serves as chair of the committee. The committee                                                                                 
may elect other officers as necessary. A majority                                                                               
of the members of the committee constitute a                                                                                    
quorum and may exercise the powers of the                                                                                       
committee.                                                                                                                      
Sec. 49. AS 42.45.990 is amended by adding a new                                                                                
paragraph to read:                                                                                                              
(6) "authority" means the Alaska Industrial                                                                                     
Development and Export Authority."                                                                                              
Page 58, line 13: Delete all material.                                                                                          
Page 77, following line 22:                                                                                                     
Insert a new bill section to read:                                                                                              
Sec. 66. AS 44.88.070 is amended to read:                                                                                       
Sec. 44.88.070. Purpose of the authority. The                                                                                   
purpose of the authority is to promote, develop,                                                                                
and advance the general prosperity and economic                                                                                 
welfare of the people of Alaska, to relieve                                                                                     
problems of unemployment. and to create                                                                                         
additional  employment by                                                                                                       
(1) providing various means of financing and                                                                                    
means of facilitating the financing. in                                                                                         
cooperation with federal, state, and private                                                                                    
institutions, of industrial, manufacturing,                                                                                     
export, small business, and business enterprises                                                                                
and the other facilities referred to in AS                                                                                      
44.88.010(a) in the state;                                                                                                      
(2) owning and operating the enterprises and                                                                                    
other facilities described in AS 44.88.172;                                                                                     
(3) fostering the expansion of exports of                                                                                       
Alaska goods, services, and raw materials;                                                                                      
(4) cooperating and acting in conjunction                                                                                       
with other organizations, public and private, the                                                                               
objects of which are the promotion and                                                                                          
advancement of export trade activities in the                                                                                   
state;                                                                                                                          
(5) establishing a source of funding credit                                                                                     
guarantees and insurance, not otherwise                                                                                         
avai1able, to support export development;                                                                                       
(6) providing and cooperating or                                                                                                
participating with federal, state, and private                                                                                  
institutions to provide actual and potential                                                                                    
Alaska exporters, particularly small- and medium-                                                                               
sized exporters, with financial assistance in                                                                                   
support of export transactions;                                                                                                 
(7) carrying out the powers and duties                                                                                          
assigned to it under AS 42.45."                                                                                                 
Page 83, line 3, following "42.45.030":                                                                                         
Insert ", 42.45,990(1)"                                                                                                         
Page 84, line 27, following "REFERENCES.":                                                                                      
Insert "(a)"                                                                                                                    
Page 85, line 10:                                                                                                               
Delete all material.                                                                                                            
Page 85, following line 15:                                                                                                     
Insert a new subsection to read:                                                                                                
"(b) The revisor of statutes shall change                                                                                       
references to "department" to read "authority" in                                                                               
the following statutes; AS 42.45.010. 42.45.020.                                                                                
42.45.040, 42.45.050, 42.45.060, 42.45.100,                                                                                     
42.45.110, 42.45.120, 42.45.140, 42.45.160,                                                                                     
42.45.170, 42.45.180, 42.45.200, 42.45.250,                                                                                     
42.45.400, and 42.45.410."                                                                                                      
                                                                                                                                
Co-Chair John Torgerson said that he would not be offering                                                                      
this amendment.                                                                                                                 
                                                                                                                                
Amendment #3: This amendment changes the bill as follows.                                                                       
                                                                                                                                
Sec. 54. AS 44.33.020(11) is amended to read:                                                                                   
(11) if directed by the governor to do so,                                                                                      
adopt regulations that authorize the state to                                                                                   
participate in the administration of the western                                                                                
Alaska community development quota program to the                                                                               
extent, and in the manner, authorized by                                                                                        
Congress, the U.S. Secretary of Commerce, and the                                                                               
North Pacific Fishery Management Council.                                                                                       
                                                                                                                                
Senator Al Adams moved for adoption.  Co-Chair John                                                                             
Torgerson objected.  Senator Al Adams spoke to his motion                                                                       
saying this amendment is clarification language that                                                                            
emphasizes state participation in the community development                                                                     
program if directed to do so by the governor. He noted that                                                                     
there are several board members on the North Pacific                                                                            
Fisheries Management Council who are appointed by the                                                                           
governor. Therefore, Senator Al Adams surmised, the                                                                             
governor would have to direct them to adopt the necessary                                                                       
regulations.                                                                                                                    
                                                                                                                                
Senator Lyda Green voiced her objection to the amendment.                                                                       
                                                                                                                                
The committee took a brief at ease.                                                                                             
                                                                                                                                
ANNALEE MCCONNELL, Director, Office of Management and                                                                           
Budget, Office of the Governor testified she had concerns                                                                       
with the ambiguity of administering the community                                                                               
development program. Given the importance of the program,                                                                       
she believed it would be advisable to retain the existing                                                                       
language since it clearly defined the responsibilities. She                                                                     
quoted the proposed language, ".participate in the                                                                              
administration if directed by the governor." saying this                                                                        
leaves questions relating to the administration of the                                                                          
program and there could be unforeseen consequences.                                                                             
                                                                                                                                
Senator Al Adams requested that Norm Cohen, be allowed to                                                                       
explain the amendment and answer Senator Loren Leman's                                                                          
question.                                                                                                                       
                                                                                                                                
NORMAN COHEN, Executive Director, Coastal Villages Region                                                                       
Fund, explained that his organization is one of the CDQ                                                                         
groups involved in the program. He stated that the sole                                                                         
purpose of the amendment is to clarify that the regulation                                                                      
authority of the department must be consistent with the                                                                         
regulations that were and are adopted by the Secretary of                                                                       
Commerce and the laws passed by the U.S. Congress. In other                                                                     
words, he said the amendment sets the perimeters that the                                                                       
state regulations must follow.                                                                                                  
                                                                                                                                
Co-chair Torgerson stated he maintained his objection.                                                                          
                                                                                                                                
The amendment FAILED to be adopted by a vote of 3-5-1.                                                                          
Senator Loren Leman, Senator Al Adams and Senator Randy                                                                         
Phillips voted in favor.                                                                                                        
                                                                                                                                
Amendment #4: This amendment inserts a new bill section on                                                                      
page 25 following line 22 and amends the next two sections                                                                      
to read:                                                                                                                        
                                                                                                                                
Sec. 14. AS 18.62 is amended by adding a new section                                                                            
to read:                                                                                                                        
Sec. 18.62.090. Definition. In this chapter,                                                                                    
"department" means the Department of Community                                                                                  
and Economic Development.                                                                                                       
Sec. 15. AS 18.63.030 is amended to read:                                                                                       
Sec. 18.63.030. Fee. The department                                                                                             
[COMMISSIONER] shall establish the triennial fee                                                                                
for a hazardous painting certificate by                                                                                         
regulation. The fee must reflect the department's                                                                               
approximate costs or projected costs for the                                                                                    
hazardous painting certification program.                                                                                       
Sec. 16. AS 18.63.100(1) is amended to read:                                                                                    
(1) "department" means the Department of                                                                                        
Community and Economic Development [LABOR];"                                                                                    
                                                                                                                                
Senator Lyda Green moved for adoption.  Co-Chair John                                                                           
Torgerson and Senator Al Adams OBJECTED.  Senator Lyda                                                                          
Green explained that in the process of reviewing the                                                                            
missions and measures and attempting to realign functions,                                                                      
she concluded it would be beneficial to move all licensing                                                                      
procedures into the Division of Occupational Licensing.                                                                         
                                                                                                                                
Representative Vic Kohring requested the Administration                                                                         
address the amendment. Annalee McConnell recommended                                                                            
against the change noting the expertise in the Department                                                                       
of Labor is important to maintain for the certification and                                                                     
licensing programs. She also pointed out there would be no                                                                      
savings with the amendment.                                                                                                     
                                                                                                                                
Senator Sean Parnell commented on Annalee McConnell's                                                                           
testimony that because there are working relationships in                                                                       
the Department of Labor, no changes should be made. He                                                                          
noted that this is the case in every department. He asked                                                                       
if there would be disadvantages or a poor mission alignment                                                                     
if the amendment were adopted. Why is it better to stay in                                                                      
already established relationships, he wanted to know.                                                                           
                                                                                                                                
Ms. McConnell stated that the expertise of administering                                                                        
the program resides in the Department of Labor. She                                                                             
explained that the licensing function relates to the other                                                                      
functions that the Department of Labor staff will continue                                                                      
to perform after the reorganization. She suggested that                                                                         
someone from the Department of Labor would be better suited                                                                     
to detail the reasoning.  She noted that the Office of                                                                          
Management and Budget had looked at whether any                                                                                 
efficiencies would be gained with this amendment, and                                                                           
determined that because the Division of Occupational                                                                            
Licensing already RSA'd the task to the Department of                                                                           
Labor, there was no advantage to moving the function to the                                                                     
new Department of Community and Economic Development.                                                                           
                                                                                                                                
Senator Lyda Green countered that it would be anticipated                                                                       
that the expertise would follow the move. She thought that                                                                      
separation was needed and suggested that a board, funded                                                                        
through licensing fees, could be formed to oversee the                                                                          
licensing functions.                                                                                                            
                                                                                                                                
Representative Vic Kohring said he would not recommend                                                                          
adoption of the amendment.  He did not feel the timing was                                                                      
right.  However, he stated he would be happy to work with                                                                       
Senator Lyda Green over the interim to draft other                                                                              
legislation to address the issue.                                                                                               
                                                                                                                                
Senator Lyda Green granted that there is often reluctance                                                                       
to change, but noted there are important considerations to                                                                      
be given to aligning occupational licensing and having all                                                                      
licensing approvals handled in the same manner.                                                                                 
                                                                                                                                
Senator Pete Kelly asked if the Department of Labor should                                                                      
testify.                                                                                                                        
                                                                                                                                
REMOND HENDERSON, Director, Division of Administrative                                                                          
Services, Department of Labor qualified that he is not the                                                                      
expert in this field but noted he had discussed the matter                                                                      
with the director of the Division of Occupational                                                                               
Licensing. He learned that the working relationships and                                                                        
expertise referred to the mechanical inspectors who work                                                                        
directly with the licensing staff. He concluded that it is                                                                      
not advantageous to move only one of the two functions,                                                                         
licensing and inspection.                                                                                                       
                                                                                                                                
Senator Lyda Green recalled that the Division of                                                                                
Occupational Licensing already handles the administrative                                                                       
functions of regulating Master Electricians and Master                                                                          
Plumbers. Therefore, she thought the division would more                                                                        
appropriately handle this function as well.                                                                                     
                                                                                                                                
By a roll call vote of 4-4-1, the amendment FAILED to be                                                                        
adopted. Co-Chair John Torgerson, Senator Gary Wilken,                                                                          
Senator Al Adams and Senator Pete Kelly voted in                                                                                
opposition. Senator Dave Donley was absent.                                                                                     
                                                                                                                                
Amendment #5: This amendment makes the following changes to                                                                     
the safety inspection provision of the bill.                                                                                    
                                                                                                                                
Page 25, lines 23 -28:                                                                                                          
Delete all material.                                                                                                            
Insert new bill sections to read:                                                                                               
"Sec. 14. AS 18.60 is amended by adding a new section                                                                           
to article 3 to read:                                                                                                           
Sec. 18.60.399. Definition. In AS 18.60.180-                                                                                    
18.60.399, unless the context otherwise requires,                                                                               
"division" means the division of safety                                                                                         
inspections, Department of Public Safety.                                                                                       
Sec. 15. AS 18.60 is amended by adding a new section                                                                            
to article 4 to read:                                                                                                           
Sec. 18.60.465. Definition. In AS 18.60.400                                                                                     
-18.60.465, unless the context otherwise                                                                                        
requires, "division" means the division of safety                                                                               
inspections, Department of Public Safety.                                                                                       
Sec. 16. AS 18.60.580 is amended to read:                                                                                       
Sec. 18.60.580. Minimum electrical                                                                                              
standards. After the American National Standards                                                                                
Institute approves a new, published edition of                                                                                  
the National Electrical Code or a new, published                                                                                
edition of the National Electrical Safety Code,                                                                                 
the division of safety inspections, Department of                                                                               
Public Safety, [LABOR} may, by regulation, adopt                                                                                
the most recent codes to constitute the minimum                                                                                 
electrical safety standards of the state.                                                                                       
Sec. 17. AS 18.60.660 is amended by adding a new                                                                                
paragraph to read:                                                                                                              
(5) "division" means the division of safety                                                                                     
inspections, Department of Public Safety.                                                                                       
Sec. 18. AS 18.60.740(4) is amended to read:                                                                                    
(4) "inspector" means a qualified inspector                                                                                     
employed by, designated by, or under contract to                                                                                
the division [DEPARTMENT OF LABOR].                                                                                             
Sec. 19. AS 18.60.740 is amended by adding a new                                                                                
paragraph to read:                                                                                                              
(5) "division" means the division of safety                                                                                     
inspections, Department of Public Safety.                                                                                       
Sec. 20. AS 18.60 is amended by adding a new section                                                                            
to article 10 to read:                                                                                                          
Sec. 18.60.825. Definition. In AS 18.60.800-                                                                                    
18.60.825, "division" means the division of                                                                                     
safety inspections, Department of Public Safety.                                                                                
Sec. 21. AS 18.70.081 is amended to read:                                                                                       
Sec. 18.70.081. Approval of fire protection                                                                                     
systems. Before October 30 of  each year, the                                                                                   
division of safety inspections, Department of                                                                                   
Public Safety, shall prepare and make available a                                                                               
list of approved fire protection systems to [THE                                                                                
DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS,]                                                                                  
the Department of Community [COMMERCE] and                                                                                      
Economic Development [,] and the public."                                                                                       
Page 77, following line 17:                                                                                                     
Insert a new bill section to read:                                                                                              
Sec. 70. AS 44.41 is amended by adding a new section                                                                            
to read:                                                                                                                        
Sec. 44.41.023. Division of safety                                                                                              
inspections. There is established in the                                                                                        
Department of Public Safety a division of safety                                                                                
inspections. The Alaska Safety Advisory Council                                                                                 
and the position of state fire marshall are                                                                                     
included within the division. The division shall                                                                                
perform the duties of the Department of Public                                                                                  
Safety that are specified for the                                                                                               
(1) state fire marshall; and                                                                                                    
(2) division of safety inspections under AS                                                                                     
18.60, AS 18.70.081, and  AS 45.45.910."                                                                                        
Page 77, following line 22:                                                                                                     
Insert new bill sections to read:                                                                                               
Sec. 72. AS 45.45.910(a) is amended to read:                                                                                    
(a) Unless exempted by the division                                                                                             
[DEPARTMENT] under (d) of this section, a person                                                                                
may not sell, offer to sell, or otherwise                                                                                       
transfer in the course of the person's business a                                                                               
consumer electrical product that is manufactured                                                                                
after August 14, 2 1990, unless the product is                                                                                  
clearly marked as being listed by an approved                                                                                   
third-party certification program.                                                                                              
Sec. 73. AS 45.45.910(d) is amended to read:                                                                                    
(d) If a consumer electrical product is a                                                                                       
work of art or an item that has an unusual                                                                                      
application that makes approval by a third-party                                                                                
certification program not reasonably available,                                                                                 
the division [DEPARTMENT] shall upon request                                                                                    
exempt the item from (a) of this section. The                                                                                   
division [DEPARTMENT] shall establish by                                                                                        
regulation guidelines to identify consumer                                                                                      
electrical products that qualify for an exemption                                                                               
under this section.                                                                                                             
Sec. 74. AS 45.45.910(e) is amended to read:                                                                                    
(e) The warning label required by this                                                                                          
section must be a brightly colored label that                                                                                   
contains in simple, direct language a warning                                                                                   
that the electrical product is not listed by an                                                                                 
approved third-party certification program. The                                                                                 
division [DEPARTMENT] shall adopt regulations                                                                                   
establishing the exact content, color, design,                                                                                  
and use of the warning label.                                                                                                   
Sec. 75. AS 45.45.910(f) is amended to read:                                                                                    
(f) Unless a later version has been adopted                                                                                     
by the division [DEPARTMENT] by regulation, a                                                                                   
certification program must meet the requirements                                                                                
of ANSI Z-34.1 - 1987, American National                                                                                        
Standards for Certification - Third-Party                                                                                       
Certification Program, published by the American                                                                                
National Standards Institute, in order to qualify                                                                               
as an approved third-party certification program                                                                                
under this section. The division [DEPARTMENT] may                                                                               
adopt by regulation later versions of the                                                                                       
American National Standards for Certification -                                                                                 
Third-Party Certification Program, as the                                                                                       
standard for third-party certification programs                                                                                 
under this section. If the division [DEPARTMENT]                                                                                
has adopted a later version, a certification                                                                                    
program must meet the requirements of the most                                                                                  
recent version adopted by the division                                                                                          
[DEPARTMENT] in order to qualify as an approved                                                                                 
third-party certification program under this                                                                                    
section.                                                                                                                        
Sec. 76. AS 45.45.910(g) is amended by adding a new                                                                             
paragraph to read:                                                                                                              
(4) "division" means the division of safety                                                                                     
inspections, Department of  Public Safety."                                                                                     
Page 83, line 2, following "REPEALER.":                                                                                         
Insert "AS 18.60.660(1), 18.60.660(2),                                                                                          
18.60.740(2), 18.60.740(3);"                                                                                                    
Page 83, line 11, following "44.47.998;":                                                                                       
Insert "AS 45.45.910(g)(3);"                                                                                                    
Page 84, following line 25:                                                                                                     
Insert a new bill section to read:                                                                                              
Sec. 99. TRANSFERS FROM DEPARTMENT OF LABOR TO                                                                                  
DIVISION OF SAFETY INSPECTIONS, DEPARTMENT OF PUBLIC                                                                            
SAFETY. The revisor of statutes shall change                                                                                    
references to the "Department of Labor" and                                                                                     
"commissioner of labor" to read "division" in the                                                                               
following statutes: AS 18.60. 190(a), 18.60.200,                                                                                
18.60.210(a)(9)(A), 18.60.210(c), 18.60.220,                                                                                    
18.60.230, 18.60.240, 18.60.270(a), 18.60.280,                                                                                  
18.60.290, 18.60.300(a), 18.60.310, 18.60.315,                                                                                  
18.60.320(a)(4), 18.60.340, 18.60.350, 18.60.360(a),                                                                            
18.60.360(c), 18.60.370, 18.60.395(a), 18.60.420,                                                                               
18.60.440, 18.60.800(a), 18.60.800(b), and 18.60.820."                                                                          
                                                                                                                                
Senator Lyda Green moved for adoption.  Senator Al Adams                                                                        
objected.  Senator Lyda Green told the Committee about a                                                                        
letter given to her, unsolicited, from a former inspector                                                                       
and current International Brotherhood of Electrical Workers                                                                     
(IBEW) member, Gerald Newton. (Copy of letter on file.)                                                                         
Senator Lyda Green explained that the amendment involves                                                                        
the consolidation of public safety issues under the                                                                             
Department of Public Safety into a newly created Division                                                                       
of Safety Inspections.                                                                                                          
                                                                                                                                
Gerald Newton's letter explains that the Department of                                                                          
Public Safety, through its Fire Marshall's Office, is                                                                           
responsible for enforcing compliance to the National                                                                            
Electrical Code (NEC), which has the purpose of "protecting                                                                     
persons and property from the hazards arising from the use                                                                      
of electricity." The State Fire Marshall is also                                                                                
responsible for enforcement of NICET certification of                                                                           
personnel performing fire alarm system installations,                                                                           
according to Gerald Newton. In addition, the letter claims                                                                      
the Department of Labor employs electrical inspectors to                                                                        
perform inspections on new commercial installations. Gerald                                                                     
Newton concluded that two departments performing these                                                                          
parallel functions is redundant.                                                                                                
                                                                                                                                
Senator Lyda Green therefore suggested maintaining the                                                                          
Occupational Health and Safety Act (OSHA) within the                                                                            
Department of Labor and moving the other inspection                                                                             
functions into the Department of Public Safety. She                                                                             
explained that this would keep the inspections that involve                                                                     
the specific safety of workers in the Department of Labor                                                                       
and place the inspections affecting all those who would use                                                                     
facilities into the Department of Public Safety.                                                                                
                                                                                                                                
ANNALEE MCCONNELL stated that the Administration had                                                                            
scrutinized the amendment and found more reason to keep the                                                                     
inspections with the other functions performed by the                                                                           
Department of Labor. She noted the status quo prevents                                                                          
unnecessary duplication in the same facilities, which the                                                                       
separation would require.  She stated that the alignment of                                                                     
functions currently proposed in the bill is the most                                                                            
streamlined.                                                                                                                    
                                                                                                                                
Representative Vic Kohring stated he could not support this                                                                     
amendment either.                                                                                                               
                                                                                                                                
The amendment FAILED to be adopted by a vote of 3-5-1.                                                                          
Senator Loren Leman, Senator Lyda Green and Senator Randy                                                                       
Phillips cast yea votes. Senator Dave Donley was absent.                                                                        
                                                                                                                                
Amendment #6: This amendment inserts a new bill section on                                                                      
page 26 following line 3 to read as follows.                                                                                    
                                                                                                                                
Sec. 16. AS 23.05.360(a) is amended to read:                                                                                    
(a) There is established within the                                                                                             
Department of Law [LABOR] the Alaska labor                                                                                      
relations agency. The agency is comprised of six                                                                                
members appointed by the governor and confirmed                                                                                 
by the legislature. The term of office of a                                                                                     
member is three years. Members serve staggered                                                                                  
terms in accordance with AS 39.05.055. A vacancy                                                                                
in an unexpired term shall be filled by                                                                                         
appointment by the governor for the remainder of                                                                                
the term. The agency must include two members                                                                                   
with a background in management, two members with                                                                               
a background in labor, and two members from the                                                                                 
general public. All members must have relevant                                                                                  
experience in labor relations matters."                                                                                         
                                                                                                                                
Senator Lyda Green moved for adoption.  Senator Al Adams                                                                        
objected.  Senator Lyda Green spoke of the Alaska Labor                                                                         
Relations Agency, located within the Department of Labor,                                                                       
that deals with grievances filed under union contracts. She                                                                     
stated that there could be a conflict of interest in the                                                                        
current system that allows an employee who files a                                                                              
grievance to possibly impact existing contracts. She                                                                            
thought there should be "an arm's length" between the                                                                           
grievance process and the implementation of contracts and                                                                       
therefore suggested moving the agency into the Department                                                                       
of Law. While she noted that the Department of Law had                                                                          
expressed there could be a conflict of interest in                                                                              
performing these functions, she disagreed and noted that                                                                        
the Department of Law has argued many issues in which it                                                                        
has been on opposing sides.                                                                                                     
                                                                                                                                
Ms. MCCONNELL indicated her office had contacted the                                                                            
Department of Law regarding this matter. She clarified that                                                                     
the Department of Law very rarely handles cases which they                                                                      
represent both sides of an argument. She noted that the                                                                         
Department of Law already advises agencies on cases pending                                                                     
and therefore, she did not recommend having the same                                                                            
department perform the functions of the Alaska Labor                                                                            
Relations Agency.  She noted that the agency's board does                                                                       
not report to the commissioner and that the department only                                                                     
handles the administrative functions of the agency. She                                                                         
added that there had been no complaints registered against                                                                      
the current location of the agency and she felt the                                                                             
Department of Labor is the most logical location for the                                                                        
agency.                                                                                                                         
                                                                                                                                
Representative Vic Kohring said he is not looking for                                                                           
conflict with the amendment's sponsor but could only                                                                            
recommend a "no" vote.                                                                                                          
                                                                                                                                
By a vote of 2-6-1, the amendment FAILED to be adopted.                                                                         
Senator Lyda Green and Senator Randy Phillips voted in                                                                          
favor of the motion. Senator Dave Donley was absent.                                                                            
                                                                                                                                
Amendment #7:                                                                                                                   
                                                                                                                                
Page 52, lines 18- 23:                                                                                                          
Delete:                                                                                                                         
"(a) A loan committee consisting of five                                                                                        
[SEVEN] members is established. The committee is                                                                                
composed of [THE COMMISSIONER OF COMMUNITY AND                                                                                  
REGIONAL AFFAIRS,] the commissioner of community                                                                                
[COMMERCE} and economic development, the director                                                                               
of management and budget, or the designees of the                                                                               
commissioner [COMMISSIONERS] or the director, and                                                                               
three [FOUR} public members."                                                                                                   
Insert:                                                                                                                         
"(a) A loan committee consisting of five                                                                                        
[SEVEN] members is established. The committee is                                                                                
composed of the executive director of the Alaska                                                                                
Energy Authority [COMMISSIONER OF COMMUNITY AND                                                                                 
REGIONAL AFFAIRS, THE 13 COMMISSIONER OF COMMERCE                                                                               
AND ECONOMIC DEVELOPMENT], the director of                                                                                      
management and budget, or the designees of the                                                                                  
executive director [COMMISSIONERS] or the                                                                                       
director, and three [FOUR] public members.                                                                                      
Sec. 48. AS 42.45.06Q(c) is amended to read:                                                                                    
(c) The executive director of the Alaska                                                                                        
Energy Authority [COMMISSIONER OF COMMUNITY AND                                                                                 
REGIONAL AFFAIRS] serves as c1air of the                                                                                        
committee. The committee may elect other officers                                                                               
as necessary. A majority of the members of the                                                                                  
committee constitute a quorum and may exercise                                                                                  
the powers of the committee.                                                                                                    
Sec. 49. AS 42.45.990 is amended by adding a new                                                                                
paragraph to read:                                                                                                              
(6) "authority means the Alaska Energy                                                                                          
Authority."                                                                                                                     
Page 77. following line 22:                                                                                                     
Insert two new bill sections to read:                                                                                           
Sec. 66. AS 44.83.070 is amended to read:                                                                                       
Sec. 44.83.070. Purpose of the authority.                                                                                       
The purpose of the authority is to promote,                                                                                     
develop, and advance the general prosperity and                                                                                 
economic welfare of the people of the state by                                                                                  
providing a means of financing and operating                                                                                    
power projects and facilities that recover and                                                                                  
use waste energy and by carrying out the powers                                                                                 
and duties assigned to it under AS 42.45.                                                                                       
Sec. 67. AS 44.83.080 is amended to read:                                                                                       
Sec. 44.83.080. Powers of the authority. In                                                                                     
furtherance of its corporate purposes, the                                                                                      
authority has the following powers in addition to                                                                               
its other powers:                                                                                                               
(1) to sue and be sued;                                                                                                         
(2) to have a seal and alter it at pleasure;                                                                                    
{3) to make and alter bylaws for its organization                                                                               
and internal management;                                                                                                        
{4) to adopt regulations governing the exercise                                                                                 
of its Corporate powers;                                                                                                        
{5) to improve, equip, operate, and maintain                                                                                    
power projects;                                                                                                                 
(6) to issue bonds to carry out any of its                                                                                      
corporate purposes and powers, including the                                                                                    
establishment or increase of reserves to Secure                                                                                 
or to pay the bonds or interest on them, and the                                                                                
payment of all other costs or expenses of the                                                                                   
authority incident to and necessary or convenient                                                                               
to carry out its corporate purposes and powers;                                                                                 
(7) to sell, lease as lessor or lessee, exchange,                                                                               
donate, convey, or encumber in any manner by                                                                                    
mortgage or by creation of any other security                                                                                   
interest, real or personal property owned by it,                                                                                
or in which it has an interest, when, in the                                                                                    
judgment of the authority, the action is in                                                                                     
furtherance of its corporate purposes;                                                                                          
(8) to accept gifts, grants, or loans from, and                                                                                 
enter into contracts or other transactions                                                                                      
regarding them, with any person;                                                                                                
(9) to deposit or invest its funds, subject to                                                                                  
agreements with bondholders;                                                                                                    
(10) to enter into contracts with the United                                                                                    
States or any person and, subject to the laws of                                                                                
the United States and subject to concurrence of                                                                                 
the legislature, with a foreign country or its                                                                                  
agencies, for the financing, operation, and                                                                                     
maintenance of all or any part of a power                                                                                       
project, either inside or outside the state, and                                                                                
for the sale or transmission of power from a                                                                                    
project or any right to the capacity of it or for                                                                               
the security of any bonds of the authority issued                                                                               
or to be issued for the project;                                                                                                
(11) To enter into contracts with any person and                                                                                
with the United States, and, 34 subject to the                                                                                  
laws of the United States and subject to the                                                                                    
concurrence of the legislature, with a foreign                                                                                  
country or its agencies for the purchase, sale,                                                                                 
exchange, transmission, or use of power from a                                                                                  
project, or any right to the capacity of it;                                                                                    
(12) to apply to the appropriate agencies of the                                                                                
state, the United States, and to a foreign                                                                                      
country and any other proper agency for the                                                                                     
permits, licenses, or approvals as may be                                                                                       
necessary, and to maintain and operate power                                                                                    
projects in accordance with the licenses or                                                                                     
permits, and to obtain, hold, and use the                                                                                       
licenses and permits in the same manner as any                                                                                  
other person or operating unit;                                                                                                 
(13) to enter into contracts or agreements with                                                                                 
respect to the exercise of any of its powers, and                                                                               
do all things necessary or convenient to carry                                                                                  
out its corporate purposes and exercise the                                                                                     
powers granted in this chapter;                                                                                                 
(14) to recommend to the legislature                                                                                            
(A) the pledge of the credit of the state to                                                                                    
guarantee repayment of all or any portion of                                                                                    
revenue bonds issued to assist in construction of                                                                               
power projects;                                                                                                                 
(B) an appropriation from the general fund                                                                                      
(i) for debt service on bonds or other project                                                                                  
purposes; or                                                                                                                    
(ii) to reduce the amount of debt financing for                                                                                 
the project.                                                                                                                    
(15) to carry out the powers and duties assigned                                                                                
to it under AS 42.45.                                                                                                           
Page 83, line 3, following "42.45.030":                                                                                         
Insert ", 42.45.990(1)"                                                                                                         
Page 84, line 27, following "REFERENCES.":                                                                                      
Insert "(a)"                                                                                                                    
Page 85, line 10:                                                                                                               
Delete all material.                                                                                                            
Page 85, following line 15:                                                                                                     
Insert a new subsection to read:                                                                                                
"(b) The revisor of statutes shall change                                                                                       
references to "department" to read "authority" in the                                                                           
following statutes: AS 42.45.010, 42.45.020,                                                                                    
42.45.040, 42.45.050, 42.45.060, 42.45.100, 42.45.110,                                                                          
42.45.120, 42.45.140, 42.45.160, 42.45.170, 42.45.180,                                                                          
42.45.200, 42.45.250, 42.45.400, and 42.45.410."                                                                                
                                                                                                                                
Senator Sean Parnell moved for adoption.  Co-Chair John                                                                         
Torgerson noted that the amendment was submitted at the                                                                         
request of Senator Jerry Mackie.                                                                                                
                                                                                                                                
Senator JERRY MACKIE stated that this amendment replaces                                                                        
Amendment #2 that was not offered. He referenced a packet                                                                       
of information before Committee members. The first page is                                                                      
titled, "Division of Energy (DOE) Program Description" and                                                                      
the packet also includes a photocopy of the relevant state                                                                      
statutes. (Copy on file.)                                                                                                       
                                                                                                                                
                                                                                                                                
Tape: SFC - 99 #139, Side B                                                                                                     
                                                                                                                                
                                                                                                                                
Senator Jerry Mackie explained that this amendment moves                                                                        
the functions of the Division of Energy from the Department                                                                     
of Community and Regional Affairs to the Alaska Industrial                                                                      
Development and Export Authority (AIDEA). He noted that the                                                                     
amendment was drafted with the input of the Administration                                                                      
because of the Administration's concerns that the transfer                                                                      
could have a negative affect on the authority's bond                                                                            
rating. Senator Jerry Mackie emphasized that he had no                                                                          
intention of influencing the bond rating and therefore                                                                          
decided to make the transfer to the Alaska Energy Authority                                                                     
(AEA), which is a "shell" corporation that resides within                                                                       
AIDEA. He stated that the protection of the AEA would                                                                           
shield the Division of Energy Program from any effect on                                                                        
the bond rating.                                                                                                                
                                                                                                                                
Annalee McConnell qualified that while this amendment was                                                                       
submitted late in the legislation's process, the transfer                                                                       
is actually a concept the Administration has been                                                                               
considering and supports. She said the reason the amendment                                                                     
was not made to the bill earlier was due to concerns from                                                                       
rural legislators, which have since been alleviated. She                                                                        
stated that the Administration thinks this is a positive                                                                        
alignment of services.                                                                                                          
                                                                                                                                
Senator Pete Kelly requested further elaboration on the                                                                         
benefits of the transfer. Knowing what he does about the                                                                        
Division of Energy and how it relates to AIDEA, which                                                                           
functions more as a corporation than a government service                                                                       
agency, he did not see how the two could be successfully                                                                        
combined.                                                                                                                       
                                                                                                                                
Ms. McConnell clarified that the Division of Energy would                                                                       
actually transfer to the AEA, which is a subsidiary of                                                                          
AIDEA. She stated that the AEA already has certain                                                                              
responsibilities for providing government services and this                                                                     
amendment specifies the responsibilities even further.                                                                          
                                                                                                                                
LAMAR COTTEN, Deputy Commissioner, Department of Community                                                                      
and Regional Affairs testified that the Rural Utility                                                                           
Business Assistance (RUBA) program currently in the                                                                             
Division of Energy would remain in the Department of                                                                            
Community and Regional Affairs under the Division of                                                                            
Municipal and Regional Assistance. In addition, he noted                                                                        
that the Power Project Loan Program would be better suited                                                                      
if included in AIDEA because AIDEA oversees other loan                                                                          
programs. He stated that it would be important in the next                                                                      
fiscal year to review the transfers to determine which are                                                                      
successful and if other changes are necessary.                                                                                  
                                                                                                                                
Representative Vic Kohring advised that he supported the                                                                        
amendment.                                                                                                                      
                                                                                                                                
The amendment was ADOPTED without objection.                                                                                    
                                                                                                                                
Amendment #8: This amendment exempts the Alaska Railroad                                                                        
Corporation from AS 44.33.010. Senator Gary Wilken moved                                                                        
for adoption.  Co-Chair John Torgerson objected for                                                                             
explanation.                                                                                                                    
                                                                                                                                
Senator Gary Wilken explained that the bill specifically                                                                        
allows that when a statute appoints a commissioner as a                                                                         
member of a board or council the commissioner may designate                                                                     
an employee of the department to act in his or her place.                                                                       
He shared that the Alaska Railroad Corporation contacted                                                                        
him with concerns about this provision. He said that in                                                                         
1992 the railroad was set up with an "arms-length                                                                               
relationship between the state and the corporation" and was                                                                     
restricted by statute from allowing voting by proxy.                                                                            
Therefore, this legislation creates a conflict, he noted.                                                                       
He elaborated saying the commissioner of the Department of                                                                      
Community and Economic Development sits as one of the seven                                                                     
board members of the Alaska Railroad Corporation and deals                                                                      
with expensive, weighty and important issues on a regular                                                                       
basis. The corporation expressed concerns that by allowing                                                                      
a representative of the commissioner partake in the board                                                                       
proceedings there would be a lack of consistency.                                                                               
                                                                                                                                
Co-Chair John Torgerson said he could see the potential for                                                                     
problems with allowing a designee to sit on the board                                                                           
rather than the commissioner.                                                                                                   
                                                                                                                                
Annalee McConnell supported the amendment.  She said the                                                                        
Administration felt it is appropriate to have the                                                                               
Commissioner sit on the board.                                                                                                  
                                                                                                                                
Co-Chair John Torgerson asked if there were any other                                                                           
boards or commissions that should also be exempted from the                                                                     
provision to allow the commissioner to appoint a                                                                                
representative to serve in his or her place. He wondered if                                                                     
the entire section should be eliminated from the bill.                                                                          
                                                                                                                                
Senator Loren Leman suggested inserting the language,                                                                           
"unless otherwise provided for by law" wherever this matter                                                                     
arose.  This would prevent other conflicts like the one                                                                         
with the Alaska Railroad Corporation, he surmised.                                                                              
                                                                                                                                
Co-Chair John Torgerson thought similar language was                                                                            
already present elsewhere in statute that allows a                                                                              
representative of the commissioner may participate in                                                                           
boards or commissions unless otherwise prohibited.                                                                              
Therefore, he did not believe AS 44.33.010, as proposed in                                                                      
the bill, is necessary.                                                                                                         
                                                                                                                                
Annalee McConnell suggested clarifying the other relevant                                                                       
statute to say that if a designee is appropriate, that                                                                          
person may serve in place of the commissioner. She noted                                                                        
that because the departments are changing, it is necessary                                                                      
to specify which commissioner is appointed to which boards.                                                                     
There will no longer be a commissioner of the Department of                                                                     
Community and Economic Development, she stated and                                                                              
therefore, the language needs to provide a replacement                                                                          
commissioner.                                                                                                                   
                                                                                                                                
Co-Chair John Torgerson withdrew his objection to the                                                                           
amendment.                                                                                                                      
                                                                                                                                
JEFF BUSH, Deputy Commissioner, Department of Commerce and                                                                      
Economic Development felt this amendment would make the                                                                         
statute consistent with the ongoing practice.  He pointed                                                                       
out that the only board or commission with a statutory                                                                          
requirement that the commissioner him or herself must sit                                                                       
on, is the Railroad.                                                                                                            
                                                                                                                                
Without objection Amendment #8 was ADOPTED.                                                                                     
                                                                                                                                
Amendment #9: This amendment makes the following changes to                                                                     
the bill.                                                                                                                       
                                                                                                                                
Page 83, line 4:                                                                                                                
Delete "AS 44.29.020(a)(14);"                                                                                                   
Page 83, line 13, following "44.19.627;":                                                                                       
Insert "AS 44.29.020(a)(14);"                                                                                                   
Page 86, line 1, following "Act,":                                                                                              
Insert "the amendment made to AS 44.27.020(3) and                                                                               
(4) by sec. 51 of this Act,"                                                                                                    
Page 86, line 2, following "63,":                                                                                               
Insert "73 -76,"                                                                                                                
                                                                                                                                
Senator Sean Parnell moved for adoption.                                                                                        
                                                                                                                                
Annalee McConnell stated that this is a technical amendment                                                                     
that the Administration recommends.                                                                                             
                                                                                                                                
JACK KREINHEDER, Senior Policy Analyst, Office of                                                                               
Management and Budget, Office of the Governor testified                                                                         
that this is to fix a drafting oversight made in the House                                                                      
Finance Committee. He explained that the effective dates of                                                                     
the transfer of childcare licensing to the Department of                                                                        
Education from the Department of Health and Social Services                                                                     
did not coincide. This amendment expands the effective date                                                                     
for the Department of Health and Social Services to prevent                                                                     
a one-year lapse in service.                                                                                                    
                                                                                                                                
Representative Vic Kohring stated he had no objection.                                                                          
                                                                                                                                
There was no objection and the amendment was ADOPTED.                                                                           
                                                                                                                                
Amendment #10: This amendment deletes "Department of                                                                            
Education and Child Development" everywhere it appears in                                                                       
the bill and replaces it with "Department of Education".                                                                        
Senator Loren Leman moved for adoption.  Senator Al Adams                                                                       
and Senator Gary Wilken objected.                                                                                               
                                                                                                                                
Representative Vic Kohring deferred to the Administration                                                                       
saying he did not have a strong opinion on the amendment.                                                                       
                                                                                                                                
Annalee McConnell testified that the commissioner of the                                                                        
Department of Education felt it is important to clarify                                                                         
that the department's responsibilities will broaden beyond                                                                      
the traditional K-12 services.                                                                                                  
                                                                                                                                
Senator Gary Wilken spoke against the amendment saying he                                                                       
felt the expansion of the responsibilities of the                                                                               
Department of Education to include aspects of child care is                                                                     
one of the best features of the bill. He thought the title                                                                      
of the department should reflect the added                                                                                      
responsibilities. While, he remained concerned with the                                                                         
multiple acronyms that this bill would create and hoped                                                                         
they could be reduced, he believed this particular one                                                                          
should remain.                                                                                                                  
                                                                                                                                
Senator Loren Leman stressed that the functions of the                                                                          
departments remained the same and he felt the department                                                                        
titles should be as simple as possible.  He recommended                                                                         
keeping the title of Department of Education.                                                                                   
                                                                                                                                
The amendment FAILED to be adopted by a vote of 3-4-1. Co-                                                                      
Chair Sean Parnell, Senator Loren Leman and Senator Randy                                                                       
Phillips voted in favor. Senator Dave Donley was absent.                                                                        
                                                                                                                                
                                                                                                                                
ADJOURNMENT                                                                                                                     
                                                                                                                                
Co-Chair John Torgerson recessed the Committee until after                                                                      
the floor session at approximately 4:20 PM.                                                                                     
SFC-99 (27) 5/14/99                                                                                                             

Document Name Date/Time Subjects