Legislature(2023 - 2024)BARNES 124
04/26/2024 03:15 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| SB228 | |
| HB298 | |
| HB277 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 298 | TELECONFERENCED | |
| + | HB 277 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 228 | TELECONFERENCED | |
HB 277-LICENSING RECIPROCITY; FEES
3:39:17 PM
CHAIR SUMNER announced that the final order of business would be
HOUSE BILL NO. 277, "An Act relating to occupational licensing;
and providing for an effective date." [Before the committee was
CSHB 277(W&M).]
3:39:33 PM
The committee took a brief at-ease at 3:39 p.m.
3:40:52 PM
REPRESENTATIVE BEN CARPENTER, Alaska State Legislature, as prime
sponsor, presented CSHB 277(W&M). He paraphrased the sponsor
statement [included in committee packet], which read as follows
[original punctuation provided]:
HB 277 requires occupational licenses to cost no more
in Alaska than other states and allows for universal
licensing reciprocity with other states. Current law
requires licenses to cost no more than the cost to the
government of approving such license.
The Institute for Justice identified 64 lower income
occupational licenses required by the state of Alaska.
The cost of these licenses is higher in Alaska for 42
of the 64 occupations. The Institute for Justice also
identified 32 occupational licenses in Alaska that
have no licensing requirements in at least 20 other
states. HB 277 eliminates licensing, but not
regulatory, requirements in Alaska for those
professions.
The Alaska Policy Forum reported that Alaska is ranked
24th in the nation for the most burdensome state-level
occupational licensing regulation. Overregulating
occupations often disincentivizes or prevents people
from pursuing an occupation that they may be
passionate about and excel at, further robbing Alaska
of goods and services and a flourishing economy that
could have been enjoyed. Reducing state-level
occupational licensure also may be among Alaska's
easiest fixes for the issue of overregulation of small
businesses.
The Policy Forum reported in 2023 that Alaska's
workforce is dwindling for a variety of reasons, and
it will take a multi-pronged approach to encourage
workers to rejoin the labor force in the state. One
thing stopping some from working or transitioning to a
different career is undue occupational licensing
burdens. While rigorous processes to obtain licenses
for some careerssuch as doctors, psychotherapists,
and surgeonsmake sense, there are plenty of jobs that
should not have such rigorous licensing requirements.
It would benefit Alaska to recognize out-of-state
licenses when the holders are in good standing or join
interstate licensing compact agreements such as the
Nurse Licensure Compact. It could also find ways to
cut back on the number of barriers and licenses
required to work in Alaska.
Alaska needs workers, and yet the state is keeping
individuals from working through burdensome licensing
requirements. Alaska can be a thriving state, with
strong families and self-sufficient individuals. It is
.notdefme to make that happen.
3:42:49 PM
ALASDAIR WHITNEY, Legislative Counsel, Institute for Justice
(IJ), gave invited testimony in support of CSHB 277(W&M). He
said the IJ encourages the committee to support the bill for two
reasons: Firstly, it would significantly reduce licensing
barriers in Alaska; secondly, it would help relieve friction in
labor markets by recognizing out-of-state licensing. He relayed
that 20 states have enacted licensing recognition reform in some
capacity. Arizona, for example, enacted one of the broadest
laws and is projected to yield a muti-billion dollar increase in
the state's gross domestic product (GDP). He encouraged the
committee to support the bill.
CHAIR SUMNER sought questions from committee members.
3:45:10 PM
REPRESENTATIVE SADDLER pointed out that in Alaska, licensing
fees fund the investigation of bad actors. He asked whether Mr.
Whiteny had considered the effect of universal licensure on the
revenue stream for Alaska licensing boards.
MR. WHITNEY answered yes, but it's difficult to ascertain the
effect because of the bill's standard for establishing fees
under a national average. He said his testimony is intended to
offer support for the recognition component of the bill and the
idea that the bill would make it easier for people who move to
Alaska to start working.
REPRESENTATIVE SADDLER asked whether the IJ believes that
implementing a national standard is a good idea for all
professional licensing.
MR. WHITNEY answered no, every state is different. However, the
IJ is advocating for ways to make licensure easier.
3:47:37 PM
REPRESENTATIVE CARPENTER stated that the bureaucracy of managing
each particular field becomes a burden that's placed on the
private sector. He said while he does not support a national
standard, he opined that the cost of regulation on the private
sector should be considered and discussed to ensure that private
sector growth is being encouraged. He reiterated that the bill
would be a function to reduce that cost.
CHAIR SUMNER sought further explanation of list of trades in
Section 1 that would exclude a person from acting as a
fiduciary.
3:49:45 PM
DONNA ARDUIN, Staff, Representative Ben Carpenter, Alaska State
Legislature, acknowledged that the bill is dense and full of
conforming language. She noted that the policy changes can be
found in Sections 2, 3, 14, and 56.
CHAIR SUMNER questioned what is being changed in section 1.
MS. ARDUIN said Section 1 is conforming language.
CHAIR SUMNER requested an overview of the sectional analysis.
3:50:59 PM
KENDRA BROUSSARD, Staff, Representative Ben Carpenter, Alaska
State Legislature, on behalf of Representative Carpenter, prime
sponsor, paraphrased the sectional analysis for CSHB 277(W&M)
[included in committee packet]. [Due to its length, the
sectional analysis for CSHB 277(W&M) is provided at the end of
the minutes.]
3:55:24 PM
MS. BROUSSARD directed attention to the PowerPoint presentation
on HB 277, entitled "HB 277 An Act Related to Occupational
Licensing." She began on slide 2, "Alaska Policy Forum," which
read as follows [original punctuation provided]:
2021 Mercatus Conter report
While regulations and licensures are usually justified
as a means of keeping consumers safe, mountains of
regulations can easily get out of control, become
counterproductive, contradict each other, and harm the
economy.
MS. BROUSSARD continued to slide 3, which read as follows
[original punctuation provided]:
Alaska is ranked 24thin the nation for the most
burdensome state-level occupational licensing
regulation. Overregulating occupations often
disincentivizes or prevents people from pursuing an
occupation that they may be passionate about and excel
at, further robbing Alaska of goods, services, and a
flourishing economy that could have been enjoyed.
Reducing state-level occupational licensure also may
be among Alaska's easiest fixes for the issue of
overregulation, since federal regulations are much
harder for a state to influence.
3:56:15 PM
MS. BROUSSARD moved to slide 4, which read as follows [original
punctuation provided]:
Alaska's private sector workforce is dwindling for a
variety of reasons, and it will take a multi-pronged
approach to encourage workers to rejoin the labor
force in the state. One thing stopping some from
working or transitioning to a different career is
undue occupational licensing burdens. While rigorous
processes to obtain licenses for some careerssuch as
doctors, psychotherapists, and surgeonsmake sense,
there are plenty of jobs that should not have such
rigorous licensing requirements.
MS. BROUSSARD turned to slide 5, which read as follows [original
punctuation provided]:
It would benefit Alaska to recognize out-of-state
licenses when the holders are in good standing or join
interstate licensing compact agreements such as the
nurse licensure compact. It could also find ways to
cut back on the number of barriers and licenses
required to work in Alaska.
Alaska needs workers, and yet the state is keeping
individuals from working through burdensome licensing
requirements. Alaska can be a thriving state, with
strong families and self-sufficient individuals. It is
time to make that happen.
MS. BROUSSARD continued to slide 6, which read as follows
[original punctuation provided]:
INSTITUTE FOR JUSTICE
The Institute for Justice studied occupational
licensing review in 15 states from 1985 to 2017 and
found that occupational and professional associations
initiated at least 83% of new licenses, concluding
that licensing policy is typically driven by special
interests, not the public interest. Overwhelmingly,
demands come from motivated parties, who may put
professional status or economic gain ahead of sound
policy. In fact, independent government reviews most
often conclude that these demands are wrongheaded.
3:57:18 PM
MS. BROUSSARD advanced to slide 7, which read as follows
[original punctuation provided]:
Institute for justice recommends that government
review licensing proposals using criteria such as
whether there is proof of harm from an occupation,
whether the benefits of licensing would outweigh
costs, and whether public safety would be better
protected in a less burdensome or restrictive way.
MS. BROUSSARD turned to slide 8, which read as follows [original
punctuation provided]:
WAYS AND MEANS COMMITTEE BILL
HB 190, The Alaska Sunset Commission Act, passed out
of Ways and Means in February and had its first
hearing in State Affairs. If the Act becomes law,
occupational licensing review will be part of the
Commission's purview.
MS. BROUSSARD concluded on slide 9, which read as follows
[original punctuation provided]:
HB 277 will fast-track the economic benefits of such
review by immediately allowing universal reciprocity
for licenses granted by other states.
HB 277 will immediately remove some of the cost burden
for licensees and prospective licensees.
3:58:45 PM
REPRESENTATIVE CARPENTER added that this bill embodies the idea
of reducing regulation to spur economic growth.
3:59:39 PM
CHAIR SUMNER referred to Section 14, paragraph (13), and asked
why a new exemption would be added for carpentry, among a number
of other trades, would be exempted.
MS. ARDUIN confirmed that the bill would eliminate a handful of
professions from the licensing requirement. She explained that
the list of trades in paragraph (13) all generally work under a
licensed general contractor. She added that the regulatory
barriers would not be removed for these professions.
4:01:37 PM
REPRESENTATIVE RUFFRIDGE shared his understanding that most
medical licenses already have a reciprocity component and asked
whether universal reciprocity is recognized by other
professions.
MS. ARDUIN said physicians and other professions with a
universal reciprocity component are not the focus of the bill.
She clarified that the bill targets lower- and middle-income
occupational licenses for which a reduction in fees would
relieve a greater burden.
REPRESENTATIVE RUFFRIDGE asked whether there is an estimate on
the average cost saving that would result from the bill.
MS. ARDUIN said there is an estimate on cost savings from the
fee reduction in some of the fiscal notes. She offered to
follow up with the requested information specific to every
occupation.
REPRESENTATIVE RUFFRIDGE stated that the licensure fees in other
states are a rolling average. He asked whether the Department
of Commerce, Community & Economic Development (DCCED) would keep
a tab on other states' occupational licensing fees and adjust
the cap on a regular basis.
4:07:37 PM
REPRESENTATIVE CARPENTER said the department would be able to
reference the national average from other organizations, like
the IJ, who maintain that data already.
4:07:58 PM
REPRESENTATIVE SADDLER said he would like to know more about the
IJ.
4:08:27 PM
MR. WHITNEY said the IJ is a non-profit law firm that works to
protect civil liberties with the goal of making it easier for
Americans to work in their chosen field. He opined that HB 277
would make it easier for people to obtain licenses and get to
work.
REPRESENTATIVE SADDLER asked whether the Institute of Justice
focuses primarily on occupational licensing issues.
MR. WHITNEY said the IJ engages in litigation efforts across the
country to help people fight unjust licensing regimes, in
addition to private property, First Amendment, and educational
choice issues.
REPRESENTATIVE SADDLER asked whether any other states base their
licensing fees on a national average.
MR. WHITNEY answered no; however, Alaska ranks in the top twenty
with regard to fee "burden." He reported that the average fees
in Alaska range from $200-$400 as of 2022 with some costing as
low as $100 and others costing up to $700. He said the
institute has not seen another state with this proposed fee
structure.
4:15:01 PM
CHAIR SUMNER asked whether the bill would apply to attorneys.
REPRESENTATIVE CARPENTER clarified that an attorney's license is
a professional license, not occupational. He said the bill
would only apply to occupational licenses.
4:15:22 PM
REPRESENTATIVE PRAX asked whether the sponsor had given any
thought to potential occupations that may benefit from "separate
details."
REPRESENTATIVE CARPENTER said licenses are supposed to be proof
of capability; however, that is not always the case. He said
the concern is that the certification has no bearing on whether
the private sector will reward the licensee for doing the job.
CHAIR SUMNER contended that licenses are less of a fitness check
and more of a confirmation of bonding and insurance.
REPRESENTATIVE CARPENTER responded that the employer has the
ultimate responsibility of ensuring that workers are bonded and
insured.
4:19:16 PM
REPRESENTATIVE SADDLER questioned the difference between
occupational and professional licenses.
SYLVAN ROBB, Director, Division of Corporations, Business, and
Professional Licensing, Department of Commerce, Community &
Economic Development (DCCED), said in the division does not
distinguish between professional and occupational licenses.
4:20:25 PM
REPRESENTATIVE RUFFRIDGE asked whether the bill would create the
need to establish a regulation framework to establish
reciprocity.
MS. ROBB opined that there would need to be a regulatory project
for many professions because of the great number of statutes the
bill deletes. In addition, the bill is problematic because it
deletes the statutory authority that allows for licensing by
credential, (indisc.), or reciprocity, depending on the
profession, and fails to include a reference the new reciprocity
section. She said the division is concerned about the bill's
impact and referred to Section 33, for example, which may result
in midwives whose licenses never expire under the reciprocity of
the bill.
REPRESENTATIVE RUFFRIDGE asked whether each board would need to
go back and draft its regulations to comply with the new
reciprocity language.
MS. ROBB answered yes, because the current statutory authority
that allows certain professions to obtain a license through
reciprocity would be deleted [if the bill were to pass] and does
not point to the new reciprocity that exists in Section 3.
4:25:18 PM
REPRESENTATIVE PRAX said he supports the concept and can't find
any downside. He asked whether there are occupations specific
to Alaska that would necessitate specific licensing
requirements.
MS. ROBB reiterated that the department has concerns with the
bill. She agree with the intention of helping people get to
work faster, reducing licensing fees, and minimizing the
regulatory burden; however, she opined that these goals would be
better accomplished through other existing legislation, such as
HB 85 and HB 314. She expressed concern about the unqualified
reciprocity in the bill in addition to the inclusion of certain
professions that are typically excluded from reciprocity, such
as game guides and marine pilots, as those jobs require
knowledge specific to Alaska.
4:29:42 PM
REPRESENTATIVE SADDLER inquired as to the elements of licensing
fees in Alaska.
MS. ROBB reported that the formula for licensing fees is
specified in AS 08.01.065, which requires that the fees cover
the cost of regulating the profession.
REPRESENTATIVE SADDLER asked whether any other states base their
licensing fees on a national average.
MS. ROBB said she is not familiar with any entity that sets its
fees based on a national average.
4:32:15 PM
CHAIR SUMNER asked whether the bill would impact licensing for
residential home builders, as that profession may require
knowledge specific to Alaska.
MS. ROBB said the bill would remove licensing requirements for a
number of specialty contractors; however, residential
contractors would not be impacted by the bill with the exception
that their fees may either decrease or increase due to the
increased administrative burden.
CHAIR SUMNER sought to confirm that the bill would not create
reciprocity for residential builders.
MS. ROBB clarified that the bill would [create reciprocity for
residential builders].
4:33:56 PM
REPRESENTATIVE PRAX inquired as to the difference between hiring
an Alaskan contractor for residential work and a contractor from
the Lower-48 and whether it's a licensing issue or an experience
issue.
CHAIR SUMNER said possibly both. He surmised that the length of
the license could be an indicator of Alaska-specific knowledge.
MS. ROBB confirmed that of the construction contract workers,
residential contractors are the only ones required to pass an
exam.
4:35:48 PM
REPRESENTATIVE RUFFRIDGE asked whether a person entering into a
licensing compact would be required to pay a fee toward the
state.
MS. ROBB said there's not a "one size fits all" structure for
compacts, as Alaska is not currently a member of any
professional licensing compact.
4:37:53 PM
CHAIR SUMNER announced that HB 277 would be held over.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 277 Presentation.pdf |
HL&C 4/26/2024 3:15:00 PM |
HB 277 |
| CS HB 277 v.B.pdf |
HL&C 4/26/2024 3:15:00 PM |
HB 277 |
| CS HB 277 v.B Sponsor Statement.pdf |
HL&C 4/26/2024 3:15:00 PM |
HB 277 |
| CS HB 277 v.B Sectional Analysis.pdf |
HL&C 4/26/2024 3:15:00 PM |
HB 277 |
| CS HB 277 v.S.pdf |
HL&C 4/26/2024 3:15:00 PM |
HB 277 |
| CS HB 277 (W&M) v.S Sponsor Statement.pdf |
HL&C 4/26/2024 3:15:00 PM |
HB 277 |
| CS HB 277 (W&M) v.S Sectional Analysis.pdf |
HL&C 4/26/2024 3:15:00 PM |
HB 277 |