Legislature(1993 - 1994)
03/30/1993 03:00 PM House L&C
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
Number 567
HB 237 - MARINE PILOT LICENSING AND TARIFFS
CHAIRMAN BILL HUDSON, PRIME SPONSOR of HB 237, read the
sponsor statement. He explained that HB 237 was introduced
to fine-tune Alaska's Marine Pilot Act of 1991, and to
provide a mechanism to determine pilotage tariffs, now left
to the several pilot organizations by statutory provision,
and scheduled to be repealed on June 30, 1994.
CHAIRMAN HUDSON further stated that while the 1991 Act
improved marine pilotage in Alaska, its implementation has
revealed that many problems still need to be addressed,
specifically with regard to the powers of the Board of
Marine Pilots and tariff setting. HB 237 seeks to remedy
these problems by:
1) better defining the powers of the Board of Marine Pilots
to make it more effective; and
2) charging the APUC with the authority to set tariffs.
Number 619
COMMISSIONER PAUL FUHS, DEPARTMENT OF COMMERCE AND ECONOMIC
DEVELOPMENT, testified in support of the work put into HB
237 and emphasized the importance of HB 237. Commissioner
Fuhs pointed out that 95 percent of Alaska's resources move
over the water.
COMMISSIONER FUHS stated that Alaska has four regions in the
state, two of which have competing piloting organizations
and two that don't.
TAPE 93-28, SIDE A
Number 001
COMMISSIONER FUHS explained that a lot of the issues the
committee will deal with are safety and efficiency; some of
the most contentious issues are purely money. Commissioner
Fuhs explained that the department called for a meeting last
month with the various aspects of the pilotage industry and
pilot groups to get people talking and air their concerns.
Number 020
COMMISSIONER FUHS reiterated the importance of moving some
of the decision making to the Alaska Public Utilities
Commission (APUC) and suggested that the APUC be charged
with the responsibility of setting the number of pilots
allowed to operate in the state.
COMMISSIONER FUHS commented that he did not know of any
other industry where the same words were used to mean the
exact opposite, and he expressed his hope that the committee
would look and listen carefully to all sides of the issues.
Number 072
REP. WILLIAMS asked what the outcome was of the meeting Mr.
Fuhs mentioned.
MR. FUHS explained that they were still working on getting
the parties together in some sort of agreeable fashion.
REP. WILLIAMS stated that he was of the opinion that the
people involved in the issues come together instead of
looking to the legislature to solve everything.
Number 115
CHAIRMAN HUDSON commented that he and his staff have met
with all sides of every issue and have come to the
conclusion that it would be impossible to please everyone on
every issue.
CHAIRMAN HUDSON pointed out that his major concerns were:
- safety of the movement of ships in Alaskan waters;
- qualifications of the pilots;
_ making certain that the pilots are separated from the
shipping companies, so that there can be no undue
influence put on the pilots; and
- uniform fees for taking a ship from point A to point
B.
COMMISSIONER FUHS added another concern that the costs of
pilotage not be so high that it be a deterrent to commerce,
and that the number of pilots be so great that pilots can't
make a living.
Number 169
DON SCHROER, CHAIRMAN, ALASKA PUBLIC UTILITIES COMMISSION
(APUC), testified that the commission does not have a
position on HB 237 yet. He said a public meeting would be
scheduled in the near future to develop a commission
position and fiscal note for HB 237. Mr. Schroer asked for
a deferment until the commission has time to evaluate the
costs involved in taking on this added responsibility.
Number 199
CARL LUCK, DIRECTOR, DIVISION OF OCCUPATIONAL LICENSING,
DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT, testified
that under current law there are provisions for competition
within regions as well as across regions. He stated that
there is an unlimited number of pilots; the board is
balanced between the pilot industry and the public; the
board sets maximum tariffs; and then the pilot organizations
negotiate with industry. He further noted that the board
disciplines pilots, approves pilot organizations, sets
training programs, licenses pilots, upgrades pilots, tests
pilots, and creates piloting regions. He said pilots are
independent contractors, prohibited from being employees,
and have to carry insurance.
MR. LUCK stated that HB 237 would limit the number of
pilots, and most states already do that.
MR. LUCK added that he hoped the following issues would be
addressed by this legislature:
- safety on Alaskan waters;
- licensed pilots for cross regions;
- equitable tariffs set by unbiased entity; and
- pilot dispatching.
MR. LUCK detailed some of the requirements to become a
licensed pilot in this state.
CHAIRMAN HUDSON noted that HB 237 does not address the pilot
dispatch issue.
Number 601
REP. PORTER asked, If the Alaska Public Utilities Commission
were to limit the number of pilots, would it pose a problem
to the free movement of commerce?
MR. LUCK explained that the pilotage act does not make the
free movement of commerce a determining factor; safety is
the only concern.
REP. PORTER added that setting the maximum too low would
curtail movement on the waters.
Number 623
MR. LUCK stated that the formula used to set limits, both
minimum and maximum, would have to provide for retirement,
sickness, vacations, etc. Mr. Luck further stated that he
believed this could be done with a considerable amount of
input and time.
TAPE 93-28, SIDE B
Number 001
CHAIRMAN HUDSON stated that he had no problem with amending
the bill to include a statement regarding the free movement
of trade.
MR. LUCK stated that currently the state regulates the
pilots and not the industry, but he envisioned industry
having to come to the table in the future with at least some
quantative analysis of how this affects the bottom line.
REP. WILLIAMS inquired about the numbers Mr. Luck cited on
when and how often pilots work.
MR. LUCK asked that the pilots answer for themselves.
Number 060
PETER LIE-NIELSEN, ALASKA COASTWISE PILOTS, testified that
his group was against setting a maximum number of pilots.
Mr. Lie-Nielsen also noted that there are a large number of
pilots over the age of 65 that will be retiring shortly.
MR. LIE-NIELSEN added that in 1992 not one new pilot was
licensed partly due to a strict licensing procedure. Mr.
Lie-Nielsen stated that the U.S. Coast Guard relaxed its
restrictions on pilotage, resulting in the Exxon Valdez
disaster.
MR. LIE-NIELSEN noted that there are numerous examples of
vessels in compulsory waters moving without pilots because
of the nonavailability of licensed pilots.
Number 212
REP. SITTON inquired how much insurance and license fees
were.
Number 224
MR. LIE-NIELSEN stated that the insurance runs about
$3,000.00 per year and the license fees are about $1,000.00
per year.
Number 230
CHAIRMAN HUDSON asked Mr. Lie-Nielsen why he believed the
state would end up with too few pilots under this proposed
legislation.
Number 244
MR. LIE-NIELSEN answered that vessels do move on the water
without pilots illegally, and restricting the number of
pilots does a disservice to the concept of safety on the
water.
Number 280
CHAIRMAN HUDSON reiterated that it was his belief that a
formula could be devised that would take into account the
concerns mentioned above and would satisfy the needs of the
industry.
Number 305
REP. WILLIAMS expressed concern with putting a cap on the
number of pilots.
MR. LIE-NIELSEN agreed that this was a concern and that
safety should come first.
Number 388
BERNIE SMITH, representing TESORO PETROLEUM AND ALASKA
STEAMSHIPS, testified that HB 237 had some good points, but
it needed more work, and he would like to see it held over
the interim for further review.
Number 425
MICHAEL SPENCE, ALASKA COASTWISE PILOTS ASSOCIATION, read a
statement on behalf of his group opposing HB 237. Mr.
Spence stated that his group was concerned about three
elements of HB 237:
1) fixing tariffs;
2) fixing the number of pilots in a region; and
3) forbidding cross regional pilotage.
Number 499
CHAIRMAN HUDSON asked Mr. Spence to be specific as to what
parts of HB 237 Mr. Spence had problems with.
Number 507
MR. SPENCE pointed out the following concerns:
- HB 237 might create a shortage of pilots;
- HB 237 prohibits cross region licensing;
- giving authority to APUC would increase tariffs; and
- HB 237 as written does not provide more safety.
Number 569
MR. LUCK clarified the licensing fee structure as it stands
now.
Number 580
REP. MACKIE asked Mr. Spence where and how in this bill
would his organization be adversely affected.
Number 593
MR. SPENCE answered that it was his group's concern that the
Board of Marine Pilots has been unfair in the past and that
they couldn't make a fair and accurate assessment of what's
needed.
Number 610
REP. MACKIE asked that the persons limit their testimony to
the legislation at hand and not air their feelings about
alleged bias and "bad blood" from the past. Rep. Mackie
said he was only interested in good public policy, not the
in-fighting between the groups.
TAPE 93-29, SIDE A
Number 001
PHIL SWAN, SOUTHEAST ALASKA PILOTS ASSOCIATION, testified
that his group supported HB 237. Mr. Swan believed that HB
237 would give the industry well-qualified pilots at a fair
price and the state would benefit by retaining exclusive
control over pilotage without any interference from
industry.
Number 078
REP. PORTER asked if HB 237 was the same as what's currently
law on the west coast.
MR. SWAN responded that HB 237 does bring Alaska law closer
to what's being done on the West Coast.
Number 122
REP. MACKIE asked if there was anything about HB 237 that
was detrimental to Mr. Swan's group.
MR. SWAN answered that his group had no concerns regarding
the bill.
CHAIRMAN HUDSON announced that he would hold HB 237 over and
adjourned the meeting at 6:34 p.m.
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