Legislature(2017 - 2018)ADAMS ROOM 519
04/06/2018 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB217 | |
| HB231 | |
| HB299 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 231 | TELECONFERENCED | |
| += | HB 299 | TELECONFERENCED | |
| += | HB 217 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HOUSE BILL NO. 217
"An Act relating to the Alaska Food, Drug, and
Cosmetic Act; relating to the sale of milk, milk
products, raw milk, and raw milk products; and
providing for an effective date."
1:37:26 PM
DIANA RHODES, STAFF, REPRESENTATIVE GERAN TARR, highlighted
that the raw milk and food exempt from regulations bill no
longer included raw milk or food exempt from regulations.
She relayed the sponsor supported the [upcoming] amendment.
1:38:31 PM
AT EASE
1:40:33 PM
RECONVENED
Co-Chair Foster relayed the amendment sponsor, Vice-Chair
Gara, was not present to offer the amendment.
Representative Guttenberg MOVED to ADOPT Amendment 1, 30-
LS0593\T.2 (Wayne, 3/3/0/18) sponsored by Vice-Chair Gara
(copy on file):
Page 2, line 26, through page 3, line 10:
Delete all material and insert:
11* Sec. 4. AS 29.71.040(a) is repealed and reenacted
to read:
(a) If a municipality that receives state money seeks
to purchase an agricultural product and an
agricultural product harvested in the state is
available that is of like quality compared with a
similar agricultural product harvested outside the
state, the municipality
(1) shall purchase the product harvested in the state
if the product is priced not more than seven percent
above the similar product harvested outside the state;
(2) may purchase the product harvested in the state
only if the product is priced not more than 15 percent
above the similar product harvested outside the state.
* Sec. 5. AS 29.71.040(b) is repealed and reenacted to
read:
(b) If a municipality that receives state money seeks
to purchase a fisheries product and a fisheries
product harvested or processed within the jurisdiction
of the state is available that is of like quality
compared with a similar fisheries product harvested or
processed outside the jurisdiction of the state, the
municipality
(1) shall purchase the product harvested or processed
within the jurisdiction of the state if the product is
priced not more than seven percent above the similar
product harvested or processed outside the
jurisdiction of the state;
(2) may purchase the product harvested or processed in
the jurisdiction of the state only if the product is
priced not more than 15 percent above the product
harvested or processed outside the jurisdiction of the
state.
* Sec. 6. AS 29.71.040(c) is amended to read:
(c) A solicitation by a municipality for the purchase
of agricultural or fisheries products must include
written notice of the purchase requirements and
limitations under (a) and (b) of this section and
[SHALL] specify [THE REQUIREMENT] that agricultural
products harvested in the state and fisheries products
harvested or processed within the jurisdiction of the
state will [SHALL] be used where possible.
subject to the limitations under (a) and (b) of this
section. If a municipality that receives state money
purchases agricultural products harvested outside the
state or fisheries products harvested or processed
outside the jurisdiction of the state, the municipal
officer responsible for the purchase shall certify in
writing the reasons that agricultural products
harvested in the state or fisheries products harvested
or processed within the jurisdiction of the state were
not purchased."
Renumber the following bill sections accordingly.
Page 3, line 13:
Delete "of'
Insert "not less than seven percent nor more than"
Page 3, line 17:
Delete "of'
Insert "not less than seven percent nor more than"
Page 3, following line 19:
Insert a new bill section to read:
"* Sec. 9. AS 36.15.050(c) is amended to read:
(c) A solicitation for the purchase of agricultural or
fisheries products must include written notice of the
preferences under (a) and (b) of this section and
[SHALL] specify [THE REQUIREMENT] that agricultural
products harvested in the state and fisheries products
harvested or processed within the jurisdiction of the
state will [SHALL] be used where possible. If the
state or a school district that receives state money
purchases agricultural products harvested outside the
state or fisheries products harvested or processed
outside the jurisdiction of the state the officer
responsible for the purchase shall certify in writing
the reasons that agricultural products harvested in
the state or fisheries products harvested or processed
within the jurisdiction of the state were not
purchased."
Renumber the following bill sections accordingly.
Representative Kawasaki OBJECTED for discussion.
Ms. Rhodes detailed the amendment had been briefly
addressed by Representative Geran Tarr at a past meeting as
it had been included in a previous version of the
legislation. There was an existing 7 percent procurement
preference. The sponsor wanted to provide flexibility for
agencies that wanted to purchase Alaska grown items. The
amendment would allow agencies to spend up to 15 percent
more on an Alaska grown product.
Co-Chair Foster noted that Vice-Chair Gara had joined the
meeting.
Vice-Chair Gara shared he was open to the bill sponsor's
views on the amendment. The amendment maintained the 7
percent local producer's preference for fisheries and
agricultural products; local producers could charge up to 7
percent higher and still win in the procurement process. He
noted it had been the law for a long time. There had been a
discussion about changing the preference to 15 percent,
which had caused some concern that the amount may be too
expensive for schools and other entities facing limited
funds. The amendment reflected an earlier version of the
bill that included a 7 percent local preference to help
local producers and if a state or community entity (e.g. a
school) wanted to go above the 7 percent they could add
another 8 percent to the price in order to select the local
product. He explained it would save money for schools and
other entities strapped for cash as the bill would not
force them to pay the extra 8 percent. The negative aspect
was the uncertainty that entities would ever opt to pay an
additional 8 percent for local dairy or fisheries. He
requested to hear the sponsor's view on the amendment.
1:44:26 PM
Co-Chair Foster replied that Ms. Rhodes had indicated the
sponsor's support.
Representative Wilson communicated she was amenable to the
7 percent. She provided a scenario where an entity chose to
go up to 12 percent to purchase carrots, but simultaneously
opted not to pay 9 percent for another type of product. She
remarked the amendment took a subject with strict rules and
would leave it up to each district to choose between 7 and
15 percent. She was uncertain how the change would comport
with existing procurement rules. She wondered whether the
change could result in law suits or complaints because the
percentage would no longer be consistent. Currently
entities had to opt for the producer within the 7 percent
range. She did not know how allowing an entity to select a
producer between the 7 and 15 percent range would work.
Vice-Chair Gara did not see a possibility for a law suit.
The law would maintain the existing 7 percent local
preference. No one would have the ability to sue a school
district or other entity for deciding to pay an additional
8 percent. For example, the law would require paying the
additional 7 percent and if a local dairy cost 9 percent
more, the school district, prison, or other state entity
could choose to pay the extra amount.
Representative Wilson clarified there were two bidders on a
procurement. She gave an example of an Alaskan business and
a Washington business submitting bids to provide milk.
Under existing law, an Alaskan business could bid up to 7
percent more and still win the bid. She believed if the bid
from the Alaskan business was 9 percent more the entity
would have to select the Washington business because there
was only a 7 percent addition. She believed the amendment
would allow an entity to pay 9 percent, which she thought
was contrary to procurement rules.
Representative Pruitt agreed with the amendment. He stated
a municipality or school district would have to put the
range in their procurement code because they could not
randomly change the percentage. He detailed entities had to
have a standard in their procurement codes. He elaborated
that a code could either specify 7 percent or up to 15
percent. Entities' procurement decisions would be based on
their procurement codes. The entities would not decide how
to apply their procurement haphazardly, which would be
subject to a lawsuit. He explained that would not be
allowable. He detailed a municipality would have to publish
its procurement rules at the beginning of a process. An
applicant would then apply based on the specified
procurement rules. He clarified the rules would be made
known beforehand, not in the middle of a procurement
process.
1:49:06 PM
Representative Wilson asked if it was the intent for the
state to use the range of 7 and 15 percent. She remarked
the state would still have the requirement for state
contracts including corrections and other.
Vice-Chair Gara replied that a bidder would bid a price. If
a price was 8 percent more, the municipality, school
district, or state entity would be allowed to pay the extra
1 percent. There were already rules to apply to two sets of
bids for milk - they were both at 7 percent and there were
rules for deciding which bids qualified and which did not;
those rules would remain. The amendment merely gave a
district or other entity the right to choose a local
product as long as it did not exceed an additional 8
percent.
Representative Wilson clarified her understanding of the
amendment. She believed Vice-Chair Gara was stating that in
the first round of bidding if with the 7 percent added, an
Alaskan entity would still be lower than the milk from out-
of-state and they would win the bid based on the 7 percent.
She asked for verification that the school district or the
state could choose to then pay 8 percent instead of the 7
percent that had been bid.
Vice-Chair Gara replied in the negative. He believed that
was the source of the confusion. He clarified that if
something was bid at 7 percent, the school district [or
other entity] would take the product at the 7 percent. The
school district would not be allowed to give a producer
more than the bid price. He provided an example where local
dairy bid at 9 percent more. He explained the school
district could choose whether to accept the 9 percent bid
or go with another bid because it was only obligated to pay
7 percent.
1:51:26 PM
Representative Wilson pointed to language in Section 9 of
the amendment on pages 2 and 3. She observed that if
something was bought from out-of-state, the purchasing
entity may be required to submit additional paperwork
detailing why the out-of-state bidder had been selected.
She asked where the paperwork would go and who would
determine what it looked like.
Vice-Chair Gara asked Representative Wilson to repeat the
location in the amendment she was referencing.
Representative Wilson read from Section 9 of the amendment:
A solicitation for the purchase of agricultural or
fisheries products must include written notice of the
preferences under (a) and (b) of this section and
[SHALL] specify [THE REQUIREMENT] that agricultural
products harvested in the state and fisheries products
harvested or processed within the jurisdiction of the
state will [SHALL] be used where possible. If the
state or a school district that receives state money
purchases agricultural products harvested outside the
state or fisheries products harvested or processed
outside the jurisdiction of the state the officer
responsible for the purchase shall certify in writing
the reasons that agricultural products harvested in
the state or fisheries products harvested or processed
within the jurisdiction of the state were not
purchased."
Representative Wilson observed the section was a mandate.
She asked where the paperwork would be filed and who would
determine its accuracy.
Vice-Chair Gara answered that it was a requirement for
entities to state the reason why they rejected a local
bidder. The reasons would be included in procurement code.
Representative Guttenberg stated the language in the
amendment consistently referred to municipality. He noted
it did not refer to school districts until page 3 of the
bill. He asked if the definition of municipality covered
school districts. He noted that not all school districts
were connected to a municipality. He provided examples
including the Yukon Koyukuk School District in the Interior
and some Southeast and possibly Southwest communities. He
wanted to ensure the reference to municipalities in one
section covered school districts.
1:54:29 PM
Vice-Chair Gara replied that the amendment governed the
same entities that the procurement code covered. The
amendment did nothing to change that. He noted the bill
sponsor may know exactly which entities were covered, but
the amendment did not change that law.
Ms. Rhodes answered that Vice-Chair Gara was correct. She
elaborated the amendment changed nothing in the procurement
code. The covered entities were school districts and
municipalities that received state money.
Representative Wilson MAINTAINED the OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Ortiz, Pruitt, Thompson, Gara, Grenn, Guttenberg,
Seaton, Foster
OPPOSED: Kawasaki, Tilton, Wilson
The MOTION PASSED (8/3). There being NO further OBJECTION,
Amendment 1 was ADOPTED.
Vice-Chair Gara addressed the fiscal notes from the
Department of Commerce, Community and Economic Development.
The note reflected a cost of $5,000 and a change in revenue
of $10,000 for FY 19 through FY 24.
1:57:21 PM
Co-Chair Seaton MOVED to REPORT CSHB 217(FIN) out of
committee with individual recommendations and the
accompanying fiscal note.
CSHB 217(FIN) was REPORTED out of committee with a "do
pass" recommendation and with one previously published
fiscal impact note: FN3 (DNR).
1:58:07 PM
AT EASE
1:58:44 PM
RECONVENED
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 231 AKSupremeCourtCasesJan2018 (003).pdf |
HFIN 4/6/2018 1:30:00 PM |
HB 231 |
| Hb 231 - Amendments 1, 2 & 3.pdf |
HFIN 4/6/2018 1:30:00 PM |
HB 231 |
| HB 231 DOA Response to HFIN 4.5.18.pdf |
HFIN 4/6/2018 1:30:00 PM |
HB 231 |
| HB 231 - Letter of Support.pdf |
HFIN 4/6/2018 1:30:00 PM |
HB 231 |
| HB 231 CFEC employees exempt reasons.pdf |
HFIN 4/6/2018 1:30:00 PM |
HB 231 |
| HB 268 - HFIN Amendments.pdf |
HFIN 4/6/2018 1:30:00 PM |
HB 268 |
| HB 316 Amendments.pdf |
HFIN 4/6/2018 1:30:00 PM |
HB 316 |
| HB 299 Amendment packet.doc.pdf |
HFIN 4/6/2018 1:30:00 PM |
HB 299 |
| HB 217 Amendment #1.pdf |
HFIN 4/6/2018 1:30:00 PM |
HB 217 |