Legislature(2021 - 2022)ADAMS 519
05/14/2021 09:00 AM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB163 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 163 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 85 | TELECONFERENCED | |
HOUSE BILL NO. 163
"An Act relating to vehicle title applications."
9:06:15 AM
REPRESENTATIVE CALVIN SCHRAGE, SPONSOR, thanked the
committee for the opportunity to present the bill. He
introduced the bill with prepared remarks:
House Bill 163 will eliminate the current language
that all signatures for title applications and title
transfers be signed in ink. This does not create a
directive for the DMV to accept electronic signatures,
but it does empower them to do so if they see fit. The
bill uses a narrow approach and only amends the
statute governing title transfers and applications for
titles, and it gives those who are involved in title
applications more leeway.
In 2004, the legislature passed the Uniform Electronic
Transactions Act. This act had been recommended by the
Uniform Law Commission to remove barriers to commerce
and to bring Alaska statutes into the modern era.
Today in Alaska, electronic signatures are accepted
for PFD applications, real estate conveyances, and
obtaining of notary signatures among other things;
however, they are not accepted for title transfers of
motor vehicles. Electronic signatures have been
crucial to keeping businesses afloat during the
pandemic and provide important conveniences to
Alaskans in remote parts of the state. For further
background, the Uniform Electronic Transactions Act
applies to all electronic transactions except those
explicitly exempted or where existing law indicates
electronic signatures cannot suffice.
Exemptions include wills, cancellations of utility
services, foreclosures, evictions, product recalls,
and notifications of hazardous materials. The original
law carved out these instances of urgent matters, but
it did not include title transfers; however, because
DMV statute on title transfers uses the words "in ink"
in their statutes, it has come to be included in that
same group.
House Bill 163 ends this exemption and empowers the
relevant parties to decide for themselves if they will
accept electronic signatures. To reiterate, the
Uniform Electronic Transactions Act leaves the
discretion of accepting electronic signatures to the
relevant departments and without House Bill 163 the
DMV cannot begin the process of looking into
administering electronic signatures. This law is a new
tool in the toolbox for DMV and it is simply a
preapproval for the department that will prevent
delays in the future.
Representative Schrage listed individuals available online
to testify. He brought attention to the new zero fiscal
note.
9:09:07 AM
LAUREN MACVAY, CEO, TRUE NORTH FEDERAL CREDIT UNION (via
teleconference), provided remarks on the bill with a
prepared statement:
Thank you for the opportunity to speak before you
today in favor of House Bill 163. It's a simple bill,
but it will open the door to a significant amount of
progress. As Representative Schrage noted, we can use
electronic signature in many important things in
Alaska, but one thing we cannot do is sign a title
application with the DMV; it needs this original "wet"
signature. A growing number of other states are
implementing electronic lien and title inclusions to
various degrees and configurations, but the "in ink"
language in AS 28 prevents our state from exploring
the benefits of this modern technology. This has
impacts on the DMV and its operations I'm sure, but it
also impacts True North and our members and frankly
every other financial institution.
True North has branch locations in Juneau and
Anchorage, but we have members throughout the state.
One of the ways that we can do that is by utilizing e-
sign and with that technology we can open new
memberships and we can close consumer and home equity
loans electronically. This was a huge benefit when the
pandemic hit. It allowed our members to continue to do
their borrowing business from the safety of their
homes and offices. It's also a benefit for borrowers
not near a branch and allows us to provide convenient
service regardless of location, clearly for members in
remote communities, that's a win. But one thing we
cannot complete electronically is any loan requiring a
title application to secure our lien unless a dealer
is handling the title loan. The impact on the
membership is that when that situation comes up, which
is usually in a person-to-person sales transaction,
the loan is held up until the original signatures can
be obtained.
Our other option is to put the burden on securing the
title work on the borrower, requiring them to deal
with the DMV paperwork and forward us the completed
title in the end. That opens the door to delays,
headaches, mistakes. Neither one of these is a good
option. Both create inconvenience for all involved. If
we were able to simple secure electronic signature on
DMV paperwork, our process would be far more
convenient for our members and much more efficient for
us and probably for the DMV.
I know the proposed changes to House Bill 163 will not
suddenly remedy the situation and that there's
significant work to be done by the DMV to assess and
implement new systems. But by removing those two
little words "in ink," the bill would remove that
critical first barrier to progress and I encourage you
to move House Bill 163 forward for that reason.
Ms. MacVay thanked the committee for its time.
9:12:11 AM
Representative Carpenter asked for the Division of Motor
Vehicles' (DMV) assessment on the impact of the bill.
Co-Chair Merrick noted that the committee would hear from
DMV after public testimony.
Co-Chair Merrick OPENED and CLOSED public testimony.
9:13:05 AM
AT EASE
9:14:05 AM
RECONVENED
Co-Chair Merrick asked DMV to review the fiscal note.
JEFFREY SCHMITZ, DIRECTOR, DIVISION OF MOTOR VEHICLES,
DEPARTMENT OF ADMINISTRATION (via teleconference), reviewed
the department's zero fiscal note. The bill would remove
the words "in ink" and would not financially impact the
division. The fiscal note had been changed from
indeterminate to zero based on the bill language.
Representative Carpenter asked how moving from a wet
signature to a digital signature would impact everyday
Alaskans dealing with [vehicle] titles. He asked if the
legislation would decrease the burden for Alaskans.
Mr. Schmitz clarified that the bill did not move from a wet
signature to an electronic signature. He explained that the
bill would remove the requirement for an ink signature. The
change would allow the DMV to begin vetting the process to
explore electronic signatures and titling. He detailed that
it would be a first step to allow the division to examine
the technology and business process. He explained that it
was too early in the process to be able to specify
efficiencies that would be created and how the process
would be easier for Alaskans. The division believed both
things would be true in the future once a complete solution
was in place.
Mr. Schmitz reiterated that the bill was a first step to
allow DMV to begin to vet what the business flow and
process would look like. The bill would also enable DMV to
begin to engage its partners including credit unions,
banks, auction houses, dealerships, people who handle
titles, and consumers to work on a solution that was
amenable to all parties. The work would include working
together to understand timelines, cost, and all things
involved in arriving at a solution. Ultimately, DMV
believed the change would create efficiencies for the
public when transferring vehicles. Additionally, there
would be efficiencies in the processing of paperwork. For
example, individuals may not have to go into the DMV to
transfer a title after purchasing a new vehicle. He stated
that individuals may be able to save a trip to the DMV in
the future. He reported that the technology was being
implemented in some other states. He stated that the option
was relatively new; the idea had existed for many years,
but the concept was coming to fruition in the present day.
Mr. Schmitz noted there were numerous questions that would
be involved including state-to-state interoperability. For
example, whether a person could transfer their Alaska title
to a different state and vice versa. He explained that
items involved in the process would all require vetting. He
relayed that the bill would allow DMV to begin the process
because it would remove the restriction requiring ink
signatures on the documents.
9:18:17 AM
Representative LeBon asked for verification that at one
time title transfers had required a notary or witness.
Mr. Schmitz replied in the negative. He was not aware of
any time where a witness or notary was required for a
vehicle transfer. He explained that if a vehicle had a lien
or loan from a lending institution, depending on the
institution's policy, the document may be notarized.
Representative LeBon remarked on the letters of support
from the Alaska Credit Union League and the Alaska Banker's
Association. He stated it was an endorsement to have both
groups come together. He supported the legislation.
Co-Chair Foster MOVED to REPORT HB 163 out of committee
with individual recommendations and the accompanying fiscal
note. There being NO OBJECTION, it was so ordered.
HB 163 was REPORTED out of committee with a "do pass"
recommendation and with one new zero fiscal note from the
Department of Administration.
Co-Chair Merrick reviewed the schedule for the afternoon
meeting.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 163 Sponsor Statement .pdf |
HFIN 5/14/2021 9:00:00 AM |
HB 163 |
| HB 163 Support Letters 4.14.21.pdf |
HFIN 5/14/2021 9:00:00 AM |
HB 163 |