Legislature(2017 - 2018)BELTZ 105 (TSBldg)
04/05/2017 01:30 PM Senate JUDICIARY
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| Audio | Topic |
|---|---|
| Start | |
| Confirmation Hearings | |
| SB15 | |
| SB29 | |
| Confirmation Hearings | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | SB 29 | TELECONFERENCED | |
| += | SB 60 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 15 | TELECONFERENCED | |
SB 29-REPEAL WORKERS' COMP APPEALS COMMISSION
2:1229:35 PM
CHAIR COGHILL announced the consideration of SB 29 and stated
his intention to take public testimony. He asked Commissioner
Drygas if the bill has a companion.
2:20:25 PM
HEIDI DRYGAS, Commissioner, Department of Labor and Workforce
Development (DOLWD), Juneau, Alaska, said the House Judiciary
Committee passed a committee substitute (CS) at the request of
the Court System. The changes were technical in nature.
SENATOR MEYER asked if the $443,000 savings reflected in the
fiscal note is a savings to the designated general fund.
COMMISSIONER DRYGAS said that's correct; the money would remain
in the Workers' Safety Compensation Administration Account
(WSCAA). It is a designated general fund account that funds
several of the department's programs for workers' compensation
and occupational safety and health.
SENATOR MEYER observed that this would not have any impact on
the budget.
COMMISSIONER DRYGAS said it should not impact the undesignated
general fund budget, but it will save the state money because
the department will spend $440,000 less. The Court System
submitted a zero fiscal note indicating that it could absorb the
additional caseload. She noted that the WSCAA account is being
drained at a faster rate than it is being replenished due to the
programs the legislature tasked the department to run without
additional funding. The workers' compensation fraud unit is an
example.
SENATOR MEYER commented that this change gives the department
$440,000 to use elsewhere.
COMMISSIONER DRYGAS said that's correct but it must be used for
workers' safety programs. She added, "If we were to deplete our
WSCAA funding, we wouldn't have to augment that funding with
undesignated general fund monies."
SENATOR MEYER asked how the WSCAA account is funded and who pays
for it.
COMMISSIONER DRYGAS deferred budget questions to Paloma Harbour.
2:27:18 PM
PALOMA HARBOUR, Director, Division of Administrative Services,
Department of Labor and Workforce Development, Juneau, Alaska,
explained that funding the Workers' Safety Compensation
Administration Account is part of the workers' compensation
costs for an employer. Payments are based on a percentage of the
workers' compensation premiums written from insurance companies
and self-insured employers. Responding to an additional question
she said that freeing up this money will help the WSCAA fund
last longer.
SENATOR MEYER said he initially thought this would show as a
savings to the overall budget.
SENATOR WIELECHOWSKI pointed out that the costs to run the
commission will go away if appeals are returned to the superior
court. Those monies can then be used for things within the
Department of Labor and Workforce Development (DOLWD) or go back
to the general fund.
MS. HARBOUR said in FY2013 the department moved some of the
workers' safety programs onto unrestricted general funds because
of a fund insufficiency in the WSCAA account. Doing away with
the commission will prevent the department from having to do
that in the future. "We're looking at a three-year cliff before
we're out of balance in this account and unable to support the
other programs."
COMMISSIONER DRYGAS added that when the commission was created
in 2005, the department was required to use existing funds to
stand up that component as well as the fraud unit. It has been a
significant drain on the WSCAA funds.
2:31:44 PM
CHARLES L. BRADY, President, Workers' Compensation Committee of
Alaska; and Workers' Compensation Manager, Arctic Slope Regional
Corporation, Anchorage, Alaska, said he is testifying in
opposition to SB 29 and he submitted written testimony to that
effect on behalf of WCCA in March. The foremost concern is that
returning appeals to the superior court would result in
significant delays. The assumption is that workers' compensation
cases would be given lower priority than all other cases. He
estimated it could take up to 18 months to get a case heard and
that the litigation would be a long, drawn-out process. He
opined that the cases would ultimately end up in the Alaska
Supreme Court.
2:35:03 PM
DAVID HALE, representing Hale and Associates and Alaska
Independent Insurance Agents and Brokers, Anchorage, Alaska,
said he is testifying in opposition to SB 15. He said he has
been in the insurance business for more than 30 years and his
recollection is that before the commission was created the
process was cumbersome for both the employer and the insurance
carrier. He said if the current process satisfies 50 percent of
the cases it's worth keeping. He suggested tweaking the current
process so that 75 percent of the claimants are satisfied. He
predicted that returning the appeals to the superior court would
add costs and time delays to both the carrier and the employer.
The time delay of up to 18 months would also disadvantage the
employee. He concluded saying, "I'd hate to see us go back to
where we were prior to '05."
CHAIR COGHILL asked if he said that part of the workers'
compensation assessment is designated for workers' compensation
issues.
MR. BRADY said yes; the tax on each premium goes to the state.
"That's where this funding comes from for that $440,000."
CHAIR COGHILL commented that that is the designated general fund
Senator Meyer spoke of.
MR. BRADY agreed.
SENATOR MEYER asked how long it takes under the current process
to get a case resolved.
MR. BRADY replied it depends of the availability of the
committee, but it can be one or two months.
2:38:18 PM
CONSTANCE LIVSEY, Attorney, Burr Pease & Kurtz, Anchorage,
Alaska, said she is speaking in opposition to SB 29 and in
support of maintaining the commission. She said she has
practiced workers' compensation law in Alaska since 1988. She
has experience with both the superior court and the appeals
commission process and the latter has far more advantages for
practitioners. Specifically, the advantages are knowledge,
experience, and consistency. The commissioners know this area of
law, whereas superior court judges do not. "This is terra
incognita to them." The results under the former process were
inconsistent and non-precedential and appeals to the Alaska
Supreme Court were much more inevitable.
MS. LIVSEY opined that the projected cost savings in the bill is
an illusion because there will be more appeals to the Alaska
Supreme Court. She noted that Ms. Meade testified in the other
body that this would be an added workload for the superior court
and these cases would not take precedence. She opined that the
precedential value of the appeals commission decisions over time
create a body of law that helps make cases before the board more
predictable, helps employees and employers understand the law,
and has generally brought about a more efficient, economical,
and streamlined adjudication process.
CHAIR COGHILL, noting that superior court decisions do not have
precedential value, asked her to comment of the value
precedence.
MS. LIVSEY said the fact that commission decisions are
precedential adds consistency to the body of law and adds
consistency and predictability to the proceedings at the board
level.
CHAIR COGHILL asked how often there were preemptory challenges
prior to 2005 and if that accounted for the lengthier process.
MS. LIVSEY said she does not recall a lot of preemptory
challenges of judges; the delays were a matter of the workload
and the fact that the cases can be complex.
2:45:56 PM
CHARLES MCKEE, representing himself, Anchorage, Alaska,
testified in opposition to SB 29. He read excerpts of the 10
page document he wrote. He characterized himself as a victim and
debt slave. He asserted that the conversion is unlawful because
it is done without full disclosure.
2:49:39 PM
ANDREW HEMENWAY, representing himself, Anchorage, Alaska,
advised that he is speaking on SB 29 on his own behalf as the
former chair of the Workers' Compensation Appeals Commission. He
noted that the testimony in support of the bill has been based
on the financial benefits and the notion that the commission
decisions tended to favor one party over the other. He suggested
that a possible solution is to place the workers' compensation
appeals in the Office of Administrative Hearings. That body
conducts hearings at the trial level like the Workers'
Compensation Board. It has a good reputation for fairness and
impartiality. That is one way to address the fairness concerns
in the workers' compensation community. He said that can be
addressed in several ways some of which would entail
restructuring the commission. Providing preemptory challenges to
the administrative law judge (ALJ) assigned to the case would
provide an outlet for people who feel that one side or the other
is being favored.
Regarding impacts on the process, he said it is generally
recognized that the court system will not be able handle these
appeals as quickly as the appeals commission. That will have an
impact on all the parties. Also, because it is common for pro se
litigants to appear before the appeals commission, they will
receive more help from staff there than from the superior court.
He said the consistency that was mentioned in previous testimony
is the result of the appeals commission having precedential
value. That is an important aspect that would be lost if the
appeals are returned to superior court. The last point is
regarding the lay commissioners. They are not attorneys, so they
are not as knowledgeable about the arcane intricacies of the
law, but they provide valuable insights and a common sense
approach.
MR. HEMENWAY suggested the legislature consider the alternative
approach of sending the appeals to a forum in the Office of
Administrative Hearings. If the legislature instead decides to
send these appeals back to the superior court, the legislation
should include a provision that gives the decisions of a
superior court judge the same degree of precedential value for
administrative proceedings that the appeals commission has now.
2:55:47 PM
SENATOR COSTELLO asked what percentage of the appeals commission
cases are reversed by the Alaska Supreme Court.
MR. HEMENWAY recalled that of 250 published decisions by the
Alaska Workers' Compensation Appeals Commission, about 100 have
gone to the Alaska Supreme Court. About 30 of those cases were
the subject of an Alaska Supreme Court opinion and about half
were reversed. Initially, the court reversed quite a few of the
appeals commission decisions, but in more recent years they have
been upheld more often than not. He added that the record shows
that when the superior court was the initial appellate body it
had a similar track record; of the cases that were the subject
of a decision, 10-15 percent of the decisions were reversed on
appeal.
2:58:26 PM
SENATOR WIELECHOWSKI asked how many cases the appeals commission
hears each year.
MR. HEMENWAY estimated 15 to 20 per year.
SENATOR WIELECHOWSKI calculated the cost under the current
process. "So, we're doing 15-20 per year and we're paying nearly
$0.5 million for that when the superior court could be doing it
for nothing; and there is roughly a 50 percent reversal rate."
He asked if that's accurate.
MR. HEMENWAY clarified that the reversal rate is calculated on
the total body of decisions. That is about 10-15 percent. Of the
cases that were decided by the Alaska Supreme Court, both the
superior court and the appeals commission were reversed about
half the time. He added that most of the cases are settled or
dismissed before a final decision and in that situation the
appeals commission decision stands.
SENATOR WIELECHOWSKI asked if it's common for administrative law
judges to hear appeals of lower body decisions.
MR. HEMENWAY said no; their function is largely equivalent to
the Workers' Compensation Board.
CHAIR COGHILL held SB 29 in committee for further review.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Anderson - Select Committee on Legislative Ethics.pdf |
SJUD 4/5/2017 1:30:00 PM |
|
| Barlow - Violent Crimes Compensation Board.pdf |
SJUD 4/5/2017 1:30:00 PM |
|
| Holmes - Select Committee on Legislative Ethics.pdf |
SJUD 4/5/2017 1:30:00 PM |
|
| Wilson - State Board of Parole.pdf |
SJUD 4/5/2017 1:30:00 PM |
|
| SB 15 - Letter of Support - Mudd.pdf |
SJUD 4/5/2017 1:30:00 PM |
SB 15 |
| SB 15 - Letter of Opposition - McDonald.pdf |
SJUD 4/5/2017 1:30:00 PM |
SB 15 |
| SB 15 - Supporting Document - E-Cigarettes and Public Policy.pdf |
SJUD 4/5/2017 1:30:00 PM |
SB 15 |
| SB 15 - Letter of Opposition - Mapes.pdf |
SJUD 4/5/2017 1:30:00 PM |
SB 15 |
| SB 15 - Supporting Document - FDA Regualtions.pdf |
SJUD 4/5/2017 1:30:00 PM |
SB 15 |
| SB 15 - Letter of Support - Mat-Su Health Foundation.pdf |
SJUD 4/5/2017 1:30:00 PM |
SB 15 |
| SB 29 - Letter of Opposition - WCCA.pdf |
SJUD 4/5/2017 1:30:00 PM |
SB 29 |
| SB 29 - Letter of Opposition - Floerchinger.pdf |
SJUD 4/5/2017 1:30:00 PM |
SB 29 |