Legislature(2017 - 2018)SENATE FINANCE 532
04/11/2018 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB128 | |
| HB121 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 285 | TELECONFERENCED | |
| += | HB 286 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 121 | TELECONFERENCED | |
| += | HB 128 | TELECONFERENCED | |
HOUSE BILL NO. 121
"An Act relating to occupational safety and health
enforcement penalties; and providing for an effective
date."
10:26:53 AM
REPRESENTATIVE SAM KITO, SPONSOR, introduced the
legislation:
House Bill 121 brings Alaska's Occupational Safety and
Health (AKOSH) state plan into compliance with federal
requirements, ensuring continued eligibility for
federal grant funds and helping to protect workers
from workplace injuries, illnesses, and fatalities.
In 2015, Congress passed the Federal Civil Penalties
Inflation Adjustment Act Improvements Act, requiring
many federal agencies to adjust penalties for
inflation going back to 1990, and requiring subsequent
yearly adjustments according to changes in the
Consumer Price Index. Occupational Safety and Health
Administration complied by adjusting their maximum
penalties in July 2016, including a six-month grace
period for states to comply. In order to comply with
federal program requirements, AKOSH must have at least
equivalent maximum and minimum penalties. AKOSH fell
out of compliance with this requirement on January 1,
2017, when the six-month buffer period expired.
Maximum and minimum penalties for violations of
Alaska's occupational safety and health laws are
specified in AS 18.60.095, the Penalties section of
Prevention of Accident and Health Hazards. House Bill
121 allows the Department of Labor and Workforce
Development to set penalty amounts by regulation, and
limits the penalties to corresponding federal maximums
for each violation type. This enables the department
to adjust to federally required changes while placing
a cap on increases.
10:28:05 AM
DEBORAH KELLY, DIRECTOR, DIVISION OF OCCUPATIONAL SAFETY
AND HEALTH, DEPARTMENT OF LABOR AND WORKFORCE DEVELOPMENT,
(DLWD) explained that in 2015 congress passed an inflation-
adjustment act that required many agencies to adjust their
penalties for inflation. She stated that in 2016 the
Occupational Safety and Health Administration (OSHA)
adjusted their maximum penalties, and required state plans
to do the same. She stated that Alaska was required to
follow suit by January 1, 2017. She explained that the bill
brought the state into compliance by requiring the
department to set the maximum OSHA penalties by regulation,
and capped those maximum penalties at the corresponding
federal levels. She stressed that the bill allowed the
state to come into compliance with federal requirement, and
to stay in compliance with the yearly required adjustments
by the CPI.
Senator von Imhof noted the three types of violations on
the fact sheet for the current maximum penalty and the new
maximum penalty. She asked whether it was Alaska data, and
whether there were additional issues in the bill. Ms. Kelly
replied that the fact sheet was from the year prior, so the
number was adjusted in the fiscal note. She remarked that
each bill section was a different category. She stated that
the categories: willful and repeat violations, serious
violations, other than serious violations, failure to
correct a violation, and posting requirement violations.
Senator von Imhof requested a one-page table of the
categories, the fee penalties, and the range of the state's
noncompliance. She noted that there was an assertion that
the state would save $619 in state funds. She asked for
more information. Ms. Kelly replied that it was $619,000
yearly that the state would lose in state funds by
reverting the enforcement program to federal OSHA.
Senator von Imhof wondered whether the net loss meant that
the state was not paying the penalties or was the state
receiving revenues. Ms. Kelly replied that the cost savings
would be in the reduction of the personal services and
associated costs. The penalties would go to the federal
treasury rather than the state penalty. Therefore, the
reference was to the state funds and not private business.
Senator von Imhof surmised that the reference was about
noncompliance with the federal government. Ms. Kelly
replied, "broadly yes."
Senator Micciche asserted that moving jurisdiction to the
federal government would not result in "noncompliance." Ms.
Kelly replied that the decision to have a state plan was
always up to the state.
Senator Micciche wondered whether the $1.31 million was a
constant, and whether it was an average over ten years. Ms.
Kelly replied that she believed that it was a three-year
average. She stated that there was a calculation based on
the actuals for, she believed, three years. She noted that
they varied year to year, because one case could add or
subtract $100,000 penalty amount for the year.
10:35:10 AM
AT EASE
10:36:03 AM
RECONVENED
10:36:05 AM
Ms. Kelly stated that the numbers in the letter were from
the fiscal note from the previous year, and the number used
the FY 16 actual penalties collected. The current year's
fiscal noted used a two-year average of the previous year
and FY 16.
Co-Chair MacKinnon queried the reason for the inconsistency
in the number of years. Ms. Kelly replied that there was a
desire to use as many fiscal years as possible, but because
of the IRIS migration there was a desire for a consistent
number; therefore, a maximum number of years was used under
the new financial accounting system.
Vice-Chair Bishop remarked that there was state control, so
the OSHA standards must be met at a minimum. The state
standards could be higher than the OSHA standards. He felt
that the bill was a housekeeping issue.
Co-Chair MacKinnon noted that the state was not in
compliance, so queried the federal government's reaction to
the noncompliance. She recalled that the sponsor suggested
a consequence of inaction, like withholding federal
financial support. Ms. Kelly replied that the out of
compliance date was January 1, 2017. The federal government
noted that the state was working toward a solution, so
there was understanding in the meantime.
Co-Chair MacKinnon wondered whether the federal government
required that it be in regulation, rather than statute, for
setting a fine. Ms. Kelly replied in the negative. She
stated that the regulatory avenue seemed like the most
practical way to make yearly adjustments.
Co-Chair MacKinnon noted that there was consternation
related to determining regulations rather than statutes.
She queried the reason for choosing regulations rather than
a statutory change. Representative Kito replied that the
federal government was requesting that agencies tracked the
consumer price index (CPI), and adjust the penalties to
adjust to modifications of the CPI. He remarked that it was
unknown whether that examination would be on an annual or
other periodic basis. He stated that setting regulation
allowed for streamlined adjustments.
10:44:00 AM
Co-Chair MacKinnon noted that the department could not
exceed the minimum set by the federal government.
Representative Kito agreed.
Senator Micciche looked at Section 6, page 3, lines 1
through 3, which did not cover the minimum. He noted that
the minimum was giving under the purview of the
commissioner. He wondered why there was not a matching of
the two.
Co-Chair MacKinnon agreed, and stated that she had already
asked that question. She wondered whether the minimum was
the maximum.
Representative Kito deferred to Ms. Kelly.
Ms. Kelly explained that the minimum penalty in statute was
the only minimum penalty. She stated that most of the
minimum penalties were zero, except for the single willful
violation minimum penalty.
Co-Chair MacKinnon requested a sectional analysis.
10:47:06 AM
CAITLYN ELLIS, STAFF, REPRESENTATIVE SAM KITO, presented
the Sectional Analysis (copy on file):
Section 1
Amends AS 18.60.095 (a) to establish that the maximum
and minimum civil penalties the commissioner may
assess an employer for a willful or repeat violation
of occupational safety and health provisions shall be
set by regulation under a new section (i) added by
this bill.
Section 2
Amends AS 18.60.095 (b) to establish that the maximum
civil penalty the commissioner may assess an employer
for a serious violation of occupational safety and
health provisions shall be set by regulation under a
new section (i) added by this bill.
Section 3
Amends AS 18.60.095 (c) to establish that the maximum
civil penalty the commissioner may assess an employer
for an other than serious violation of occupational
safety and health provisions shall be set by
regulation under a new section (i) added by this bill.
Section 4
Amends AS 18.60.095 (d) to establish that the maximum
civil penalty the commissioner may assess an employer
who fails to correct a violation of occupational
safety and health provisions shall be set by
regulation under a new section (i) added by this bill.
Section 5
Amends AS 18.60.095 (g) to establish that the maximum
civil penalty the commissioner may assess an employer
for violations of posting requirements shall be set by
regulation under a new section (i) added by this bill.
Section 6
Amends AS 18.60.095 by adding a new subsection (i)
that directs the commissioner to establish by
regulation the maximum civil penalty amounts to be
imposed under (a) (d) and (g) of this section and
the minimum imposed under (a). It stipulates that the
maximum civil penalties may not be greater than the
corresponding federal penalties and must include
adjustments to correlate with inflation rates as
specified under the Federal Civil Penalties Inflation
Adjustment Act Improvements Act of 2015.
Section 7
Establishes that this Act applies to violations
occurring on or after the effective date of this Act.
Section 8
Allows the department to adopt regulations necessary
to implement this Act.
Co-Chair MacKinnon wondered whether the CPI would affect a
rate increasing or decreasing. Ms. Ellis replied in the
affirmative, stating that it would be adjusted on annual
basis accordingly.
Co-Chair MacKinnon asked for agreement. Ms. Kelly replied
in the affirmative.
Vice-Chair Bishop surmised that it could not exceed the
federal maximum penalties. Ms. Kelly agreed.
Co-Chair MacKinnon OPENED public testimony.
Co-Chair MacKinnon CLOSED public testimony.
Co-Chair MacKinnon discussed committee business.
SB 121 was HEARD and HELD in committee for further
consideration.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 121 - Additional Document - Sponsor's Reply to House Judiciary Committee Questions 3.10.17.pdf |
SFIN 4/11/2018 9:00:00 AM |
HB 121 |
| HB 121 - Sponsor Statement 3.6.17.pdf |
SFIN 4/11/2018 9:00:00 AM |
HB 121 |
| HB 121 - Sectional Analysis 3.6.17.pdf |
SFIN 4/11/2018 9:00:00 AM |
HB 121 |
| HB 121 - Support Document - Federal memo to state plans 02.23.17.pdf |
SFIN 4/11/2018 9:00:00 AM |
HB 121 |
| HB 121 - Supporting Document-OSHA Fact Sheet 3.6.17.pdf |
SFIN 4/11/2018 9:00:00 AM |
HB 121 |
| HB 121-DOLWD Response to SFIN 4.11.18.pdf |
SFIN 4/11/2018 9:00:00 AM |
HB 121 |