Legislature(2021 - 2022)SENATE FINANCE 532
05/03/2021 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB100 | |
| SB9 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 100 | TELECONFERENCED | |
| + | SB 9 | TELECONFERENCED | |
| + | HB 69 | TELECONFERENCED | |
| + | HB 71 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE FINANCE COMMITTEE
May 3, 2021
9:03 a.m.
9:03:08 AM
CALL TO ORDER
Co-Chair Bishop called the Senate Finance Committee meeting
to order at 9:03 a.m.
MEMBERS PRESENT
Senator Click Bishop, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Lyman Hoffman
Senator Donny Olson
Senator Natasha von Imhof (via teleconference)
Senator Bill Wielechowski
Senator David Wilson
MEMBERS ABSENT
None
ALSO PRESENT
Representative Adam Wool, Sponsor; Ashley Carrick, Staff,
Representative Wool; Senator Peter Micciche, Sponsor.
PRESENT VIA TELECONFERENCE
Teri Cothren, Associate Vice President, Workforce
Development, University of Alaska; Doug Walrath, Director,
Northwestern Alaska Career and Technical Center, Nome; Anna
Brawley, Title IV Review Coordinator, Agnew Beck
Consulting, Anchorage; Lee Ellis, President, Brewers Guild
of Alaska, Anchorage.
SUMMARY
SB 9 ALCOHOLIC BEVERAGE CONTROL; ALCOHOL REG
SB 9 was HEARD and HELD in committee for further
consideration.
CSHB 69(FIN)am
APPROP: OPERATING BUDGET/LOANS/FUNDS
CSHB 69(FIN)am was SCHEDULED but not HEARD.
CSHB 71(FIN)
APPROP: MENTAL HEALTH BUDGET
CSHB 71(FIN) was SCHEDULED but not HEARD.
HB 100 EXTEND WORKFORCE INVEST BOARD ALLOCATIONS
HB 100 was HEARD and HELD in committee for
further consideration.
HOUSE BILL NO. 100
"An Act relating to allocations of funding for the
Alaska Workforce Investment Board; and providing for
an effective date."
9:03:54 AM
Co-Chair Bishop noted that the committee would hear HB 100
for the first time and intended to set the bill aside.
9:04:22 AM
REPRESENTATIVE ADAM WOOL, SPONSOR, discussed HB 100, which
proposed a three-year reauthorization of the Technical
Vocational Education Program (TVEP). The program used .16
percent of unemployment insurance receipts and provided
grants around the state to many technical vocational
education programs. The total of the grant was
approximately $12 million and impacted thousands of
students. The largest recipient was the University of
Alaska (UA), which received 45 percent of the receipts,
which it distributed to various campuses around the state.
Other colleges and programs that received the funding
included the Alaska Vocational Technical Center (AVTEC) in
Seward, Alaska Technical Center in Kotzebue, and Iligsavik
College in Utqiagvik. He noted that the bill had been
unchanged in the other body. The program recipients and
funding amounts had remained unchanged since 2014.
9:06:23 AM
ASHLEY CARRICK, STAFF, REPRESENTATIVE WOOL, discussed the
presentation "Technical Vocational Education Program (TVEP)
Re-Authorization" (copy on file).
Ms. Carrick looked at slide 2, "TVEP Program History":
? Established under AS 23.15.830
? Created in 2000 to provide noncompetitive grant
assistance to education entities in Alaska that
delivered specific vocational/ technical training.
? In 2014, the Legislature increased the amount of
funds diverted to TVEP from 0.15% of unemployment
insurance to 0.16%.
? HB 100 seeks to re-authorize the program for another
3 years.
Ms. Carrick spoke to slide 3, "Types of Training":
TVEP Recipients Offer
? Aviation
? Fisheries
? Construction
? Renewable Energy
? Mining
? Information Technology
? Transportation
? Health Care
? Other Vocational Training
Ms. Carrick referenced slide 4, "How TVEP Funding Gets
Distributed," which showed a flow chart. She noted that the
unemployment insurance receipts were drawn from the
employee portion of checks and then diverted to the State
Training and Employment Program (STEP) and TVEP.
Ms. Carrick turned to slide 5, "TVEP Recipients Over Time":
In 2000:
University of Alaska: 52%
Kotzebue Training Center: 16%
Alaska Vocational Technical Center: 32%
In 2001:
University of Alaska: 63%
Kotzebue Training Center: 11%
Alaska Vocational Technical Center: 22%
Galena Project Education Training Center: 4%
In 2004:
University of Alaska: 55%
Kotzebue Training Center: 11%
Alaska Vocational Technical Center: 22%
Galena Project Education Training Center: 4%
Southwest Alaska Vocational Education Center: 4%
Yuut Elitnaurviat, Inc., People's Learning Center: 4%
Ms. Carrick considered slide 6, "TVEP Recipients Over Time
Cont.":
In 2008:
University of Alaska: 45%
Kotzebue Training Center- Alaska Technical Center: 9%
Alaska Vocational Technical Center: 17%
Galena Project Education Training Center: 4%
Southwest Alaska Vocational Education Center: 3%
Yuut Elitnaurviat, Inc., People's Learning Center: 9%
Delta Career Advancement Center, Partners for Progress
Delta, Inc.: 3%
Amundsen Educational Center: 2%
Northwestern Alaska Career and Technical Center: 3%
University of Alaska Southeast: 5%
Ms. Carrick displayed slide 7, "Current TVEP Recipients":
In 2014 and again in 2017:
Statewide: University of Alaska: 45%
Kotzebue: Alaska Technical Center: 9%
Seward: Alaska Vocational Technical Center: 17%
Galena: Galena Project Education Training Center: 4%
Dillingham: Southwest Alaska Vocational Education
Center: 3%
Bethel: Yuut Elitnaurviat, Inc., People's Learning
Center: 9%
Delta: Partners for Progress Delta, Inc.: 3%
Kenai: Amundsen Educational Center: 2%
Nome: Northwestern Alaska Career and Technical Center:
3%
Utqiagvik: Illisagvik College: 5% (Added in 2014)
9:10:08 AM
Ms. Carrick highlighted slide 8, "TVEP Distributions,"
which showed a chart. She drew attention to the far-right
column, which showed proposed distributions for FY 22. She
explained that even with the fluctuations during COVID-19
the previous year and draws from unemployment, there had
been a relatively stable source of funding for TVEP
recipients.
Ms. Carrick addressed Section 1 of the bill, which extended
the program reauthorization date to 2024. Section 1 also
included the list of ten recipients and the percentages of
funding distribution. She continued that Section 2 of the
bill contained a retroactivity clause and Section 3
included an effective date.
Senator Hoffman recalled that there was a termination
clause in the original program, and that the program had
been reauthorized numerous times. He thought the success of
the program was evident. He asked if the sponsor had
considered extending or removing the sunset date to create
a permanent program.
Representative Wool relayed that Senator Hoffman's question
had come up in the House Finance Committee as well. He
thought the reauthorization period allowed for time to
examine the list of funding recipients, which had not
changed in six or seven years. He thought the question was
whether the recipients should be locked in indefinitely and
pondered whether the funding numbers should be permanent.
Senator Wielechowski asked for an easily identifiable list
of participants at each institution and the number of
students that had successfully completed the program.
Ms. Carrick thought that the information was in the TVEP
annual report.
9:14:06 AM
AT EASE
9:14:55 AM
RECONVENED
Senator Wielechowski pointed out that the information was
contained in the TVEP annual Report (copy on file). There
was information on page 2 and performance data on page 6.
Co-Chair Bishop suggested that the next time the bill was
heard the committee could invite the Department of Labor
and Workforce Development (DOL) to address the topic.
Senator Wilson recalled that a previous bill had included
consideration of the constitutionality of TVEP funding and
referenced a letter from the Legislative Legal Department.
He wondered if the sponsor had received a memo regarding
the constitutionality of some of the vocational
rehabilitation programs that were privately funded.
Representative Wool was not aware of the constitutionality
of funding for private institutions versus public
institutions.
Ms. Carrick relayed that in having the bill drafted, the
sponsor and staff had not received any advice regarding the
constitutionality of the proposed funding.
Senator Wilson wanted a clear definition regarding the
constitutionality of the TVEP, the Alaska Scholars Program,
and others. He was concerned about the challenges that
could arise by funding the programs.
Senator von Imhof observed that two percent of the
allocation went to the Amundsen Education Center (AEC),
which was a faith-based non-profit educational and
vocational training school located in Soldotna. She thought
the term "faith-based" indicated there was a religious
component to the organization, which she thought could be
unconstitutional. She was curious as to why the public
funds were going to a faith-based organization.
Representative Wool stated that the question had come up
before regarding the efficacy of the program in Soldotna,
but no one had raised strong objection to the school since.
He thought there was public and private institutions on the
list of grant recipients. He stated he could work with the
Legislative Legal Department to gather more information on
the topic.
Senator Olson appreciated the intent of the bill. He wanted
to address the AEC, which had done a great deal of outreach
to people in his district. He was in support of the
educational outreach and thought the program was
successful.
Co-Chair Bishop commented that TVEP was a good program.
9:19:47 AM
TERI COTHREN, ASSOCIATE VICE PRESIDENT, WORKFORCE
DEVELOPMENT, UNIVERSITY OF ALASKA (via teleconference),
spoke in favor of the bill, which would provide critical
funding for short-term career and technical education
programs across the state. She asserted that the program
would support the state's economic recovery by re-scaling
and up-scaling Alaskans for employment.
Ms. Cothren spoke to highlights from the presentation
"University of Alaska Technical Vocational Education
Program, " (copy on file). As a TVEP recipient, UA used its
funds as a single allocation within the system. The program
was administered through a competitive request for fund
proposal or grants process. The program provided industry-
specific, on-the-job, and classroom training that addressed
high demand and regional workforce needs. She thought the
program increased collaboration and was responsive to
industry.
Ms. Cothren cited that UA utilized TVEP to train 4,320
Alaskans in FY 20 for jobs in mining, oil and gas,
fisheries, seafood, maritime, construction, Internet
Technology, health, aviation and more. She cited that in FY
20 the average cost per participant among all TVEP
recipients was $1,349. The University had averaged a cost
of $1,300 per participant, with nearly 78 percent being
employed following training. Some programs had as much as
89 percent employment in the state after graduation with
increased wage growth. She listed successes in the
certified nurse's assistant program.
9:22:47 AM
Senator Wielechowski considered the numbers cited and
thought the average per participant at the AEC was $11,890.
He wondered why the amount was so much higher than the
other educational centers.
Representative Wool thought the numbers were calculations
of how much funding the institution received divided by the
number of graduates, and the AEC had a low number of
graduates. He pondered that the program reauthorization was
an opportunity to examine the numbers and make changes if
needed. He did not have historical data on the center and
thought bigger institutions would have better average
numbers.
Senator von Imhof looked at page 6 of the TVEP annual
report, which had performance measurements. She saw that
various post-program employment rates ranged from 45
percent to 63 percent, rather than the 80 percent or 90
percent she had heard.
Co-Chair Bishop affirmed that the AEC was showing an 86
percent employment rate after 12 months.
Senator von Imhof commented that if the state was giving
public money to a religious institution, it should be
consistent across all sectors including K-12 education.
9:26:13 AM
Senator Wielechowski looked at page 2 of the TVEP annual
report, which indicated that the center was getting
$249,700, which equated to $11,890 per participant compared
to the average of near $1,300. He acknowledged that the
success rate of the center was good but thought it was a
good topic for evaluation.
Co-Chair Bishop thought it would be helpful to include DOL
in the future discussion, and the department could talk
about the specific careers that participants were being
trained for.
Senator Olson thought the success rate was more important
to consider than to ponder questions of constitutionality.
He thought the matter had been addressed. He was concerned
that there was not as much emphasis on the success rate of
the Amundson Center as compared to some other institutions.
Senator von Imhof asked if there was any funding going to
the Kenai Peninsula College (KPC). She understood there was
a technical center in Nome and asked how it was faring.
Ms. Cothren detailed that there was funding that went to
KPC as well as its Kachemak Bay Campus in Homer. Currently
the funding went towards a technical program as well as
some health programs.
Co-Chair Bishop added that the KPC was also home to Mining
Training and Petroleum Institute. He noted there were
different segments in UA that performed better than others.
The mining industry employed 88 percent of the graduates
out of the mining training program.
Senator von Imhof asked about the Northwest Alaska Career
and Technical Center in Nome. She noted there were 31
students that attended in 2020. She asked how the students
fared and if was a good place to stay versus in Soldotna.
She wondered what was being offered in Soldotna that was
not offered in Nome.
Co-Chair Bishop thought there was invited testimony that
could address Senator von Imhof's question.
9:30:46 AM
DOUG WALRATH, DIRECTOR, NORTHWESTERN ALASKA CAREER AND
TECHNICAL CENTER, NOME (via teleconference), supported the
reauthorization of the TVEP funding. He thought the program
provided autonomy and flexibility to meet the unique needs
of each regions priority industries. He mentioned in-region
workforce development and sued healthcare training as an
example of a top priority. The Norton Sound Health
Corporation was the largest regional employer in the Nome
census area. The corporation provided dual-credit high
school training, and industry certification, which
transitioned high school students into healthcare jobs.
Mr. Walrath continued that Nome was poised for several
large projects addressing national interests. He mentioned
a $379 million appropriation for an Arctic deep draft port
in Nome. In January, the federal government had designated
a high priority infrastructure project 40 miles from Nome
involving a graphite deposit. He mentioned driver education
training and cuts that had eliminated the Nome Division of
Motor Vehicles (DMV) office. The career and technical
center in Nome provided the only adult and high school
driver education training and was a DMV-approved road
tester in the region.
Mr. Walrath addressed Senator von Imhof's question
regarding leaving the region for training. He discussed the
importance of getting a driver's license. He thought it was
critically important to make early outreach to develop a
technically skilled workforce.
Senator von Imhof appreciated the explanation from Mr.
Walrath and understood there were specialty locations
around the state. She mentioned ship piloting in Seward.
She asked about the use of program funds in high schools
and wondered if it was appropriate. She wondered if the
program funding was comingling with Department of Education
and Early Development funds. She understood vocational
technical training started in the high school years and
asked if TVEP had traditionally funded high school students
as opposed to adults.
9:34:51 AM
Senator Olson thought exposure to vocational education
opportunities was important for high school students. He
discussed continuing education after high school without a
break and the importance of exposure to vocational
education. He asked Mr. Walrath about the 35 percent
employment achievement at the center in Nome as opposed to
some other programs.
Mr. Walrath noted that across all TVEP recipients, there
was a population of both adults and high school students
served. He acknowledged there was disparity and thought one
could see the impact of local decision-making. He cited a
research study from 2009 that indicated that prior to TVEP,
the graduation rate in the Bering Straits region averaged
about 38 percent. He asserted that TVEP had engaged
students and kept them in school on a graduation pathway.
He discussed engaging courses that led to health care jobs
such as certified nurse's aide (CNA). He thought the
percentage of employment was lower as the number of high
school program participants was higher. He discussed the
increase in graduation rate. He thought the impact was
profound based on the small investment.
Mr. Walrath added to Senator Olson's remarks about getting
high school students through training and participants
engaging in continuing education in the summer right after
high school as opposed to waiting.
9:38:30 AM
Senator Olson considered that the previous year had been
complicated by the COVID-19 pandemic, and asked what Mr.
Walrath expected for participation the following year in
the district.
Mr. Walrath cited the TVEP report, and the impacts of the
pandemic as shown in participation numbers for the year. He
thought looking at data from the prior three years would be
more accurate. He mentioned sending instructors to villages
and hoped the numbers would climb the following year.
Co-Chair Bishop commented that the state was on the
precipice of benefitting from an eight-year federal
infrastructure bill. He thought it was good timing for the
committee to consider HB 100 because the infrastructure
work would call for an increased workforce. He was thankful
that there was a workforce delivery system in place to meet
the demand.
Senator Olson pointed out that Nome deep port projects
seemed to be progressing. The majority of funding had been
secured from federal sources. He anticipated a fair amount
of construction in the Nome area in the following seven to
eight years.
Senator von Imhof thought TVEP was an excellent program
that she fully supported and agreed with Co-Chair Bishop
regarding training the next generation of the workforce.
She wanted to ensure that the program was being used as
intended. She had received emails that pondered whether the
program funding was being used as intended and spent on
workforce development. She thought an audit or deeper dive
could provide information on details. She pondered
competing programs. She offered to forward the comments on
to Co-Chair Bishop.
9:42:56 AM
Co-Chair Bishop OPENED and CLOSED public testimony.
Co-Chair Bishop mentioned there was an amendment deadline
for Wednesday, May 5 at 5:00 o'clock p.m.
HB 100 was HEARD and HELD in committee for further
consideration.
9:43:18 AM
AT EASE
9:46:30 AM
RECONVENED
SENATE BILL NO. 9
"An Act relating to alcoholic beverages; relating to
the regulation of manufacturers, wholesalers, and
retailers of alcoholic beverages; relating to
licenses, endorsements, and permits involving
alcoholic beverages; relating to common carrier
approval to transport or deliver alcoholic beverages;
relating to the Alcoholic Beverage Control Board;
relating to offenses involving alcoholic beverages;
amending Rule 17(h), Alaska Rules of Minor Offense
Procedure; and providing for an effective date."
9:46:30 AM
Co-Chair Bishop relayed that the committee was hearing SB 9
for the first time and would consider the bill and then set
it aside.
9:47:04 AM
SENATOR PETER MICCICHE, SPONSOR, discussed the bill. He
reminded that the bill had passed the Senate twice. He
emphasized that the legislation was a collaborative, year's
long effort from a large group of stakeholders. he
estimated that there was about 16,000 hours invested in the
bill. He listed stakeholders including public safety,
public health, the industry, the Alcohol and Marijuana
Control Office (AMCO) Board, the Alcoholic Beverage Control
(ABC) Board, and the legislature.
Senator Micciche relayed that stakeholders had worked
together to meet the goals of Title IV in promoting a fair
business climate, protection of public health and safety,
limiting youth access to alcohol, promoting responsible
alcohol use and reducing the harms of over-consumption,
implementing change without negatively harming existing
businesses and responsible operators, and expanding local
control for municipalities.
Senator Micciche noted that key concepts of the bill were:
sticking with a three-tier system to prevent inappropriate
monopolies, licensure restructure with clearly defined
categories, and regulating the number of licenses available
in each community by type. He emphasized that the bill was
about balance, reorganization, and fairness. He noted that
90 percent of the bill proposed to reorganize existing
statute.
Senator Micciche identified that not every bar owner
supported the bill, but the Alaska Cabaret, Hotel,
Restaurant and Retailers (CHARR) Association did support
the bill. He noted that not every manufacturer supported
the bill, but the Alaska Brewers Guild did support the
bill. He thought the Department of Public Safety wanted the
bill to be stricter, but Recover Alaska, the Alaska State
Troopers, and the Public Safety Employees Association
supported the bill because of the balance that had been
struck between. He thought the bill was important for
economic recovery in the industry. He emphasized that
although alcohol was the number one substance abuse problem
in the state, it was also an important industry. He
asserted that the bill improved public safety and provided
tools for the industry to be successful.
9:50:42 AM
ANNA BRAWLEY, TITLE IV REVIEW COORDINATOR, AGNEW BECK
CONSULTING, ANCHORAGE (via teleconference), discussed the
presentation "Alcoholic Beverage Control (ABC) Board Title
4 Review Project - Overview of Senate Bill 9" (copy on
file).
Ms. Brawley advanced to slide 5, "Goals of Title 4 Review
Process":
A comprehensive, systems-level review, and a series of
compromises to make Title 4 work better for everyone.
Promote a fair business climate and protect public
health and safety.
1.Create rational regulation for all tiers of the
state's alcohol industry.
2.Limit youth access to alcohol, while ensuring youth
are not criminalized
3.Promote responsible alcohol use and reduce the harms
of overconsumption.
Make Title 4 a clear and consistent legal framework.
1.Increase swiftness, proportionality and consistency
of penalties.
2.Increase local law enforcement of Title 4.
3.Increase licensee accountability before the ABC
Board for Title 4 violations
Ms. Brawley thought the goal of the bill was to strike a
balance and have the state's alcohol laws work better for
everybody.
Ms. Brawley showed slide 6, "Categories of
Recommendations":
1.Alcohol Licenses, Permits and Trade Practices
2.Role and Functions of the ABC Board and Staff
3.Underage Drinking and Youth Access to Alcohol
4.Regulation of Internet Sales of Alcohol
5.Technical or Administrative Law Changes
6.Local Option Communities
**Note: Local Option recommendations are documented in
the report, but not included in SB 9. More
comprehensive discussion of Local Option laws is
needed in the future.6
Note: all section references current to SB 9 ver. I,
4-14-21
Ms. Brawley discussed slide 7, " The 3-Tier System":
Alcohol must be manufactured, distributed and sold to
the public by different businesses. This is designed
to prevent monopolies.
Ms. Brawley stated that slide 7 was a general overview of
how the state managed alcohol. There was a flow chart
showing the three tiers: manufacturing, wholesale, and
retail. She mentioned that much of the bill discussion had
pondered how to keep the system in place but be more
flexible and respond to how the current system operated.
Ms. Brawley spoke to slide 8, "Alaska's Liquor License
System: Proposed Changes," which showed a graph flow chart.
She noted that the next three slides were part of a graphic
that illustrated how SB 9 reorganized existing licenses so
that they were easy to understand. The licenses would
follow the general organization of the three-tier system
and would offer more options for businesses such as
endorsements.
Ms. Brawley looked at slide 9, "Alaska's Liquor License
System: Proposed Changes." The graphical chart showed the
types of retail licenses that served the public, such as
bars, package stores, and restaurants. She explained that
most already existed in law save for a few new licenses
being proposed that she would address in a later slide.
Ms. Brawley showed slide 10, "Alaska's Liquor License
System: Proposed Changes." The graphical chart showed the
retail tier licenses. She thought it was important to
understand that there were licenses specifically responding
to the fact that the state had a strong tourism and
hospitality sector. The licenses were not tied to
population limits and were designed to serve visitors to a
community. Some of the licenses already existed and were
more options proposed in the bill.
9:54:09 AM
Ms. Brawley addressed slide 11, "Proposed: More Retail
Options for Manufacturers," which showed a flow chart. She
explained that the slide was an example of how the bill was
proposing more flexibility. She noted that currently a
brewery would have one license that allowed it to make beer
and sell it to the public on a limited basis. The bill
proposed more options for the businesses to be able to own
a bar, a restaurant, or package store, which was not
currently allowed. She mentioned a "brewpub" business model
as opposed to a limited retail space.
Ms. Brawley reviewed slide 12, "Proposed: Manufacturer
Sales Limits by Product Type," which showed a graphical
chart of onsite sales versus offsite sales for brewery,
winery, and distillery retail. The slide illustrated what
was already in the law and clarified how much each limited
retail license allowed for serving.
Ms. Brawley spoke to slide 13, "Proposed: Endorsements on
Licenses":
Add endorsements to existing licenses, giving
businesses flexibility in how to operate, without
creating more specific license types.
BASE LICENSE
ENDORSEMENTS - Expanded activities and/or premises to
fit business model
Endorsements would allow sampling on premises,
multiple bar rooms, deliveries by package stores, etc.
Section 13, 04.09.400; endorsements defined in
04.09.410 - .520
Ms. Brawley explicated that rather than creating a new
license type for every single business model, the bill
proposed to allow more flexibility by adding endorsements
to licenses. She used the example of allowing for a larger
premises or allowing sampling not allowed under the base
licenses. She thought licenses had been expanded in
inconsistent ways in the past and that endorsements would
allow more options.
Ms. Brawley spoke to slide 14, "Proposed Endorsements":
? R-7A | Bowling Alley Endorsement
? R-7B | Package Store Shipping Endorsement
? R-7C | Package Store Delivery Endorsement
? R-7D | Package Store Re-Packaging Endorsement
? [R-1] Multiple Fixed Counter Endorsement
[R-1] Hotel/Motel Endorsement
? [R-1] Large Resort Endorsement
? [R-3] Package Store Sampling Endorsement
? [M-1] Brewery Repackaging Endorsement
Ms. Brawley noted that many of the proposed endorsements
were already in law but were not standardized nor easily
added to a license.
Ms. Brawley referenced slide 15, "Proposed: Limited Free
Samples for Package Stores":
• In current title 4, Package Stores cannot allow any
consumption on premises
• the bill would allow small free samples, with a
Package Store Sampling Endorsement
• Ounce limits defined as: "Any combination of
products, not to exceed the alcohol equivalent of
any single product type"
• Ex: Customer A chooses 12 oz. beer. Customer B
chooses 6 oz. cider and 3 oz. wine. Customer C
chooses 2 oz. wine, and 4 oz. beer.
Ms. Brawley looked at slide 16, " R-7 Standardize Permits":
? Unlike licenses, permits are typically issued for
single events, on or off licensed premises.
? Define all permit types in statute, not just in
regulation
? Fee for all permits is $50 per event day
? Most permits listed are already in statute or
regulation
? New permit: Tasting Event Permit, allowing a
Package Store to host an event on premises
Section 13, 04.09.600; permits defined in 04.09.610 -
.690
Ms. Brawley showed slide 17, "Proposed Permits":
? R-7F | Beverage Dispensary Caterer's Permit (AS
04.11.230; 3 AAC 304.685)
? R-7G | Restaurant Caterer's Dining Permit (3 AAC
304.680)
? R-7H | Club Caterer's Permit (3 AAC 304.690)
? R-7I | Nonprofit Event Permit (AS 04.11.240)
? R-7J | Art Exhibit Permit (3 AAC 304.697)
? R-7K | Alcoholic Beverage Auction Permit (3 AAC
304.699)
? R-7L | Inventory Resale Permit (Retail Stock Sale
License, AS 04.11.200)
? R-7M | Package Store Tasting Event Permit (proposed)
? [2020] | Music Festival Permit (proposed)
? [2020] | Live Music & Entertainment Permit
(proposed)
Section 13, 04.09.600; permits defined in 04.09.610 -
.690
Ms. Brawley noted that some of the listed permits were held
by licensees, and others were held by non-profits. The bill
proposed to reorganize what was allowed.
Ms. Brawley reviewed slide 18, "Proposed: Package Store
Tasting Event Permit":
• Allows a package store to host a special tasting
event on its own premises, with onside consumption
of alcohol for those attending event.
• The event may be in the store or another area of
their property, such as a special event space. it
may not be held in an offsite location.
• Licensees can only offer products in their
inventory.
Hosting license
• Event may last up to 4 hours, and must end by 9 p.m.
• Must also serve food
• Each license can host 6 events per year in the same
community as the license is located
Ms. Brawley spoke to slide 19, "Population Limits: Current
Title 4 (AS 04.11.400)":
Population limits determine how many of each license
type may be issued in each community.
Restaurants: 1 per 1,500 residents.
All other license types (bars, package stores, golf
courses, breweries, etc.): 1 per 3,000 residents.
Some licenses are exempt from population limits: bars
located in hotels or airports, restaurants issued for
public convenience, and licenses that serve tourists.
Ms. Brawley explained that the next few slides addressed
population limits. She communicated that there were
exceptions to what was listed on slide 19, specifically for
tourism.
9:58:05 AM
Ms. Brawley addressed slide 20, "Population Limits: Current
Title 4 (AS 04.11.400)":
Some license types are exempt from population limits:
most exempt license types are designed to serve
tourists and travelers, such as hotels or outdoor
recreation lodges.
They can be issued if other qualifications are met
(ex: minimum number of hotel rooms).
Ms. Brawley commented that the bill did not propose to
throw the system out, and that there were health and safety
reasons for wanting to limit the number of licenses. She
recognized there were existing licensees that bought into
the system. The stakeholders had discussed how to allow for
more flexibility for small cities with a limited number of
licenses.
Ms. Brawley reviewed slide 21, "Proposed Seasonal REPL
Tourism":
?Seasonal restaurant license
?Available in smaller communities (< 40,000 pop.)
?Same operating requirements and privileges as
full-year restaurants (REPL)
Number of licenses per community determined by
formula:
5-year average of annual visitors/months in
season = Average monthly visitor population
Residents + average monthly visitors)/1,500 =
Available Seasonal REP Tourism Licenses
Season defined as up to 6 months per year, in any
combination
Example: May through September + 1 winter month
Section 13, 04.09.360
Ms. Brawley showed slide 22, "Proposed: Covert Public
Convenience Licenses and Applications":
Existing Public Convenience licenses would be
converted to regular Restaurant or Eating Place
Licenses (REPLs).
Public Convenience - Not transferable
REPL - Transferrable to a new owner or location
Applications that have been completed as of the bill's
signing date would be converted to applications for
regular REPLs, and could be approved by the ABC Board
outside the existing population limits.
Public Convenience
Application
REPL - can be approved outside of population limits
Sections 167-169, Transition
Ms. Brawley noted that the application process for
converting to restaurants had been cumbersome for all and
under the proposed changes would be more streamlined.
Ms. Brawley discussed slide 23, "Proposed: Local Government
Petition for Additional Alcohol Licenses," which showed a
flow chart of a proposed bill provision that would expand
options for licenses in communities. The provision would
allow a municipality to prepare a petition for more alcohol
licenses in the community. The community could petition the
ABC Board for more licenses of a certain type in the
jurisdiction. The city would have recourse to revise the
application if it was rejected.
Ms. Brawley looked at slide 24, "Proposed: Option to
Relocate Some Licenses from a Borough to a City":
• Current Title 4 allows relocation of a bar (BDL)
from a borough to a city within that borough.
• The bill proposes also allowing relocation of
package stores
Ms. Brawley spoke to slide 25, "Proposed: Regulate Trade
Practices":
Some trade practices are illegal in federal law:
practices of alcohol manufacturers and wholesalers to
compel retailers' buying decisions or stopping them
from buying competitors products.
Proposed: add equivalent sections to Title 3, protect
retails and allow for state enforcement.
Tied House
Partial ownership of retail license by a
manufacturer, to control what products are sold
or exclude competitors. Does not apply to 100
percent manufacturer-owned licenses.
Exclusive outlet
Agreement between supplier and retailer to
exclude other retails or suppliers.
Commercial bribery
Supplier pays bonus or provides merchandise in
exchange for exclusive arrangement or agreement
not to purchase other products.
Consignment sales
Supplier and retailer make deals to take back
unsold products.
Section 88, 04.16.017
Ms. Brawley noted that the slide showed things illegal in
federal law but that were not enforced. Most states had
laws that allowed an agency such as AMCO to enforce the
rules. She noted that the manufacturers and wholesalers had
brought up the topic with the bill stakeholders.
10:02:00 AM
Ms. Brawley referenced slide 26, "F-1. Adjust License Fees
to Reflect Current ABC Budgetary Needs":
Update license fees according to privileges and
administrative costs of each, and collect sufficient
revenue to cover the ABC Board's required activities:
Administration of licenses & permits
Education about Title 4 and related regulations
Enforcement of Title 4 and related regulations
? ABC Board required to review license fees at least
every 5 years.
? See Appendix, Table 2 of the Title 4 Review report
for current license fees and proposed changes.
Section 8, 04.06.090; License fees throughout Section
13
Ms. Brawley noted that the ABC Board and AMCO were receipt-
funded agency. The fees had not been changed in many years.
Ms. Brawley spoke to slide 27, "Proposed: More
Accountability for License Fees Allocated to Local
Governments":
• Current Title 4 allows for local governments to
receive an allocation equal to the license fees
collected in their area, intended for enforcement of
Title 4 and related ordinances.
• Reporting on these activities in required, but not
defined in statute. Some jurisdictions report
regularly, while others do not.
• The bill includes better reporting and prevention
about use of these funds, and requiring reports
about education activities as well as enforcement.
Section 81, 04.11.610
Ms. Brawley discussed slide 28, "RB-4. ABC Board as Key
Partner for Alcohol Education Efforts":
• The ABC Board and AMCO, subject matter experts on
Title 4, would work with other agencies and
organizations to develop a coordinated education
plan about responsible alcohol use and applicable
laws.
• Coordinate with Department of Health and Social
Services and other agencies tasked with alcohol-
related education.
28 Section 5, 04.06.075; Section 9, 04.06.090
Ms. Brawley showed slide 29, "Internet Sales in Alaska: Few
Rules":
? Alaska is one of the only states with no rules for
Internet sales of alcohol.
? Alaska Package Stores cannot sell alcohol online,
only via (paper) written orders.
? Alaska Wineries and Package Stores can ship wine to
customers in some circumstances.
? Without state laws restricting online sales, there
are currently no limits on purchases of alcohol online
from out-of-state sellers.
? Alaska consumers also do not pay state excise tax on
online purchases, as they do on products sold and
purchased in state.
Co-Chair Bishop asked if there had been an amendment in the
Senate Labor and Commerce Committee that had related to
taxation of wine.
Senator Micciche affirmed that there had been such an
amendment to the bill, the but the bill had not passed.
Ms. Brawley discussed slide 30, "Proposed: Regulate
Internet Alcohol Sales":
• Alaska does not limit online sales of alcohol. Order
from out of state businesses are not subject to
Alaska's alcohol excise tax, and the state cannot
track how much alcohol is ordered each year.
• The bill would create a Winery Direct Shipment
License and allow online alcohol sales only from
U.S. wineries and Alaska package stores.
-Alaska customer orders wine online from winery
Wine only: no beer or spirits
-Winery Direct Shipment Licensee verifies:
Is the customer 21 or older?
Is customer in a non-Local Option area?
Is order within limit for personal use?
6 cases per sale
12 cases per year
-Common carrier receives, transports and delivers
order
-Carrier verifies customer is 21+, delivers package in
person
Section 13, 04.09.370; Section 90, 04.16.022; Section
159, 43.60.060
10:06:04 AM
Ms. Brawley addressed slide 31, "Proposed: Regulate
Internet Alcohol Sales":
• Common carriers must be approved by the ABC board to
transport and deliver alcohol consumers throughout
the state.
• Carriers must demonstrate that they have policies
and train employees to properly handle shipments of
alcohol.
-Carrier maintains policies:
• Safe alcohol handling
• Delivery to adult, age 21+
• Delivery in-person only
-ABC board reviews and approves carrier for alcohol
transport and delivery
-ABC board publishes list of approved carriers
Section 13, 04.09.750
Ms. Brawley looked at slide 32, "Tracking Alcohol orders in
Local Option Areas: Current title 4":
Residents in Local Option communities that allow
importation of alcohol may order a limited amount of
alcohol each month for personal and non-commercial
use.
Monthly Importation Limit
• 12 gal. Beer - Or 1 half-barrel (15.5 gal) keg
• 24L wine (32 bottles)
• 10.5 L spirits (14 bottles)
-Alaska customer sends order to package store
-Licensee verifies:
• Is customer 21 or older?
• Has customer met monthly order limit?
• is new order within monthly limit?
-Licensee records new order in ABC Board database
-Access limited to:
• ABC Board
• Package stores
• Law enforcement
-Common carrier receives, transports and delivers
order
-Carrier delivers package
Sections 10-12 & 16,04.06.095; existing monthly limits
defined in AS 04.11.010
Ms. Brawley discussed slide 33, "Proposed: Publish
Community-Level Data from Local Option Order Database":
• In current Title 4, all data in the Local Option
order database is private, and deleted after 1 year.
• the bill would keep individual order information
private, but retain aggregate data for 10 years and
allow the ABC Board to publish annual total sales
volume by region or community.
• This valuable information would be available to
communities and law enforcement to understand the
flow of alcohol into Local Option communities via
legal sales.
- Keep community level data 10 years
- Protect individual order data
- ABC Board publishes annual data reports
Sections 10-12, 04.06.095
10:07:17 AM
Senator Wielechowski asked about slide 30, which addressed
creating a winery-direct shipment license and would allow
online alcohol sales from U.S. wineries and Alaska package
stores. He asked about sales from brewing companies and
distillers and whether the businesses were allowed to sell
online under the bill.
Ms. Brawley indicated that most states had a similar system
in which only the shipment of wine was allowed. She
understood that UPS and FedEx would not ship products other
than wine and required a contact with the winery to be able
to ship.
Senator Wilson asked if breweries and distilleries in the
state could ship their product. He asked if there were any
other group or industry that had expressed interest in
shipping products other than wine within the state.
Ms. Brawley did not want to speak for other industries and
sectors regarding the provision. She noted that the
stakeholder group had not heard opposition to the provision
from other industry stakeholders. She thought the law
differed by state.
Co-Chair Bishop asked if the bill would allow an Alaskan
distiller to sell spirits online to the Lower 48.
Senator Micciche thought there was an invited testifier
that could address the question. He stated that he had not
heard from any parties that had a business model that
resulted in shipping beer or spirits. He knew there were
some people in the state that did ship wine to the Lower
48, and under the bill would be able to continue doing so.
He reiterated that most states were doing wine only. He
mentioned excise taxes for selling within the state.
10:11:07 AM
LEE ELLIS, PRESIDENT, BREWERS GUILD OF ALASKA, ANCHORAGE
(via teleconference), addressed shipping out of state.
Shipping directly into any state was regulated by the
receiving state. Brews or distillers in Alaska could ship
to other states that allowed it. He noted that UPS did ship
beer. He thought brewers had not expressed particular
interest in the subject of shipping prior to the pandemic.
He thought Alaska had an unfair law regarding personal
importation. The current law allowed breweries and
distilleries to ship to Alaska, while Alaskan breweries and
distilleries were not allowed to ship directly to consumers
in the state.
Senator Wilson was interested in helping to try and level
the playing field, and would work with the bill sponsor.
Ms. Brawley addressed slide 34, "RB-6. Revise Title 4
Penalties":
? Review penalties for all Title 4 sections, and
revise as needed to make penalties proportionate to
the offense, and more consistently enforced.
? Retain existing Misdemeanor and Felony charges for
serious offenses, particularly those causing harm to
children.
? Ensure that the ABC Board, and licensee, is informed
about Title 4 convictions: require court to send
records to AMCO, and AMCO to send to the licensee.
? ABC Board retains authority to impose conditions or
additional penalties, including suspending or revoking
license.
? See Appendix, Table 3 in Title 4 Review Report for
table of all current penalties and proposed changes.
Defined throughout; most prohibited acts defined in
chapters 11 + 16
Ms. Brawley informed that the remaining slides would deal
with penalties. She noted that the stakeholder group had
addressed how to rebalance penalties for minor offenses to
be dealt with while keeping serious crimes prosecuted at
current levels.
Ms. Brawley discussed slide 35, "Proposed: Revise Penalties
for Lesser Offenses":
• In current law, almost all violations of Title 4 are
Class A misdemeanors.
• When penalties are set high across the board and
perceived to be too strict for most offenses, law
enforcement is less likely to issue citations and
courts are less likely to pursue those cases.
• In the bill, many penalties would become minor
offenses. Serious violations, such as selling
alcohol without a license, allowing gambling on the
premises, or perjury on a license application would
remain misdemeanors felonies, as they are today.
Minor Offense (Violation
• Up to $500 fine (most are $250)
• Community work service
• Does not require court appearance
Example: Failure to post required warning signs,
noncompliance with a permit regulation
Class A Misdemeanor
• up to $10,000 fine
• Up to 1 year in prison
• 10 years probation
• Requires court appearance
Example: Selling alcohol without a license, knowingly
allowing underage sales by employees
Class C Felony
• Up to $50,000 fine
• Up to 5 years in prison
• 10 years probation
• Requires court appearance
Example: Perjury on state license application (Class
B), importing large amounts of alcohol into local
option area
Defined throughout; most prohibited acts defined in
chapters 11 + 16
Ms. Brawley summarized that the bill proposed to move minor
offenses to minor offense or violation charges and allow
the ABC Board or another local enforcement agency to issue
a fine. Anything that was a serious offense would be
retained as a felony or misdemeanor.
10:14:14 AM
Ms. Brawley showed slide 36, "Proposed: Licensee Penalties
for Overserving an Adult or Serving a Minor":
(AS 04.16.030 and AS 04.16.052)
• In current Title 4, a licensee or employee who
knowingly overserves an intoxicated adult or who
serves alcohol to a minor is guilty of a Class A
Misdemeanor.
• The bill would change the penalty for both statutes
to a Minor Offense, with a $500 fine.
• In addition to the penalty to the person who commits
the violation, the owner of the license would
receive an administrative (non-criminal) penalty of
$250. This alerts the owner that a violation
occurred, holds them immediately accountable and
encourages future compliance.
Employee serves a minor
- Employee receives ticket and $500 fine from law
enforcement
- Licensee receives $250 administrative from ABC
Board
Section 92, 04.16.030; Section 104, 04.16.052;
Sections 127 - 129, 04.16.180
Mr. Brawley discussed incentivizing good behavior of
businesses. She emphasized businesses knowing a violation
happened, and an incentive for corrective action. She
thought the proposed $500 fine was a stiff penalty for
serving a minor. She thought the tickets would allow the
ABC Board to track offenses and know if corrective action
was needed.
Senator Wielechowski asked about the standard of knowingly
serving a minor. He asked if the charge was proposed to be
dropped from a misdemeanor to a $500 fine.
Ms. Brawley affirmed that the standard was "knowingly"
serving a minor. She thought the Department of Law could
speak more definitively to the definition. She reiterated
that there had been a lack of enforcement of the
misdemeanor charge, and the group had discussed the most
effective way to go forward.
Senator Wielechowski asked about the potential for
additional penalties for multiple offenses.
Ms. Brawley shared that the stakeholder group had discussed
the idea of graduated penalties, which was not built into
the proposed bill. She reminded that the ABC Board could
step in and suspend an operator's license, which was a
significant deterrent.
Senator Wielechowski asked how many individuals were
charged per year with overserving or serving a minor.
Ms. Brawley did not have current data but recalled that
previous data regarding Title IV offenses showed that half
of the offenses were related to minor consuming.
Vanishingly few of the offenses were to an employee or
licensee under the proposed statute.
10:18:11 AM
Senator Micciche explained that it had taken time for him
to support the proposed change listed on slide 36. He had
learned that the misdemeanor cases were not being
prosecuted and that the courts had higher priorities. He
related that the proposed bill provided more enforcement
and education with greater available licensing dollars. He
emphasized that the proposed system would provide more
information for licensees. He thought the proposed change
would make the issue more self-correcting as employees
would have tickets on record.
Ms. Brawley addressed slide 37, "Proposed: Require Keg
Registration":
• Reduces adults' incentive to legally purchase
alcohol and supply an underage drinking party.
• Kegs tagged with the purchaser's contact information
can be tracked if confiscated at an underage party
or other situation where minors are given access to
alcohol.
• A person, not a licensee, possessing an untagged keg
containing alcohol could be fined.
• Modeled on existing Anchorage and Juneau ordinances.
Licensee sells keg, tags with purchaser information
Party with responsible adults
- Keg returned to licensee, tag removed
Party with underage drinkers
- Ticket to keg purchases for furnishing alcohol
to minors
Section 134, 04.21.012
Ms. Brawley stated that the proposed keg registration not
only tried to try to help with the problem of underage
drinking but used enforcement to address the issue. The
proposed keg registration practice was already in place in
Anchorage and Juneau. She asserted that the proposal
signified a public health best practice.
Senator Wielechowski asked about the penalty for an adult
that knowingly purchased alcohol for a minor.
Ms. Brawley stated that for a person not employed by a
licensee, the penalty would still be a Class A misdemeanor.
The keg registration would be an additional penalty. She
imagined that if the keg purchaser was identified as the
source of alcohol consumed by underage drinkers, the
purchaser would be charged with a misdemeanor.
10:22:42 AM
Senator Olson understood that currently breweries were not
allowed to have live music to perform on the premises,
while many manufacturers could have non-profit fundraisers
with music. He asked if the bill would allow for a change
the treatment of live music.
Ms. Brawley affirmed that the bill would clarify that a
brewery, winery, or distillery with a retail license was
allowed to have live music on the premises. The bill would
make a slight change to allow for closure at 10 o'clock
p.m.
Senator Micciche commented that there was a compromise that
had occurred two years previously. He recalled that the
board had been trying to enforce some regulations for
manufacturers facility. Part of the compromise went from a
"soft close" at 8 o'clock in the evening to a "hard close"
at 10 o'clock in the evening. The bill limited new tasting
rooms to one in 12,000. There could be four permitted
events per year, as well as community events such as art
shows and fundraisers. He recalled that the previous
director of AMCO was terminated due to 12 pages of public
testimony against the regulations. He thought there was a
balance by working with different user groups.
Senator Wilson asked if the bill would allow for curbside
pickup.
Senator Micciche answered in the negative but thought
allowing curbside pickup would be helpful for the industry.
He thought it was a concept worth considering.
SB 9 was HEARD and HELD in committee for further
consideration.
Co-Chair Bishop discussed the agenda for the following day.
ADJOURNMENT
10:26:55 AM
The meeting was adjourned at 10:26 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 100 Backup ATC Support Letter.pdf |
HFIN 4/14/2021 9:00:00 AM SFIN 5/3/2021 9:00:00 AM |
HB 100 |
| HB 100 Backup Galena City School District Support Letter.pdf |
HFIN 4/14/2021 9:00:00 AM SFIN 5/3/2021 9:00:00 AM SFIN 5/14/2021 1:00:00 PM |
HB 100 |
| HB 100 Backup City of Kenai Fire Support Letter.pdf |
HFIN 4/14/2021 9:00:00 AM SFIN 5/3/2021 9:00:00 AM |
HB 100 |
| HB 100 UA Presentation 3.15.21.pdf |
HL&C 3/15/2021 6:30:00 PM HL&C 3/17/2021 5:45:00 PM SFIN 5/3/2021 9:00:00 AM SFIN 5/14/2021 1:00:00 PM |
HB 100 |
| HB 100 Backup Intro Presentation 041421.pdf |
HFIN 4/14/2021 9:00:00 AM SFIN 5/3/2021 9:00:00 AM |
HB 100 |
| HB 100 Backup NACTEC Support.pdf |
HFIN 4/14/2021 9:00:00 AM SFIN 5/3/2021 9:00:00 AM SFIN 5/14/2021 1:00:00 PM |
HB 100 |
| HB 100 Backup TVEP Annual Report FY20.pdf |
HFIN 4/14/2021 9:00:00 AM SFIN 5/3/2021 9:00:00 AM SFIN 5/14/2021 1:00:00 PM |
HB 100 |
| HB 100 Backup UA Result Report.pdf |
HFIN 4/14/2021 9:00:00 AM SFIN 5/3/2021 9:00:00 AM SFIN 5/14/2021 1:00:00 PM |
HB 100 |
| HB 100 Backup UA Results Overview.pdf |
HFIN 4/14/2021 9:00:00 AM SFIN 5/3/2021 9:00:00 AM SFIN 5/14/2021 1:00:00 PM |
HB 100 |
| HB 100 Backup UAFAA Support Letter.pdf |
SFIN 5/3/2021 9:00:00 AM |
HB 100 |
| SB 9 Sectional Analysis version A 2-10-21.pdf |
SFIN 5/3/2021 9:00:00 AM SL&C 2/12/2021 1:30:00 PM |
SB 9 |
| SB 9 Title 4 Review Report 02.2019.pdf |
SFIN 5/3/2021 9:00:00 AM SFIN 1/19/2022 1:00:00 PM SL&C 2/12/2021 1:30:00 PM |
SB 9 |
| SB 9 Letter of Support combined as of 2.10.21.pdf |
SFIN 5/3/2021 9:00:00 AM SL&C 2/12/2021 1:30:00 PM |
SB 9 |
| SB 9 Letter of Support MSHF.pdf |
SFIN 5/3/2021 9:00:00 AM SL&C 3/3/2021 1:30:00 PM |
SB 9 |
| SB 9 Opposition Mat-Su Borough.pdf |
SFIN 5/3/2021 9:00:00 AM SL&C 3/10/2021 1:30:00 PM |
SB 9 |
| SB 9 Sectional Analysis version B 2.10.21.pdf |
SFIN 5/3/2021 9:00:00 AM SJUD 3/29/2021 1:00:00 PM |
SB 9 SB9 Sectional Analysis Version B |
| SB 9 Sponsor Statement ver B.pdf |
SFIN 5/3/2021 9:00:00 AM SJUD 3/29/2021 1:00:00 PM |
SB 9 SB9 Sponsor Statement |
| SB9 ALL Public Testimony February 10- April 7.pdf |
SFIN 5/3/2021 9:00:00 AM |
SB 9 |
| SB 9_Title4Pres_Senate_FIN_5.2021.pdf |
SFIN 5/3/2021 9:00:00 AM |
SB 9 |
| HB 100 Backup SFIN UA Presentation.pdf |
SFIN 5/3/2021 9:00:00 AM |
HB 100 |