Legislature(2023 - 2024)BELTZ 105 (TSBldg)
03/24/2023 01:30 PM Senate LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| SB89 | |
| SB51 | |
| SB93 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 89 | TELECONFERENCED | |
| + | SB 51 | TELECONFERENCED | |
| *+ | SB 93 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
SB 93-FISHERMEN'S FUND: VESSEL OWNER CLAIMS
2:36:40 PM
CHAIR BJORKMAN reconvened the meeting and announced the
consideration of SENATE BILL NO. 93 "An Act relating to claims
against protection and indemnity insurance policies of vessel
owners; and providing for an effective date."
He noted there was a committee substitute (CS) for the committee
to consider. He solicited a motion.
2:37:02 PM
SENATOR BISHOP moved to adopt the committee substitute (CS) for
SB 93, work order 33-LS0538\B, as the working document.
CHAIR BJORKMAN asked Ms. Achee to walk the committee through the
bill, including the changes in the committee substitute.
2:37:24 PM
LAURA ACHEE, Staff, Senator Jesse Bjorkman, Alaska State
Legislature, Juneau, Alaska, introduced SB 93 on behalf of the
Senate Labor and Commerce Committee. The Fishermes Fund
Advisory and Repeals Council has requested that the maximum
reimbursement that a vessel owner can receive when filing a
claim for the injury or illness of a crew member be raised from
the current value of $5,000. The council proposed raising it to
$10,000, which matches the deductible on many of the policies
owned by vessel owners. In the House Fisheries Committee the
House companion bill was amended to increase the maximum claim
amount to $15,000, because $10,000 isn't always enough to cover
the deductible. Even with the increase, the projected
disbursements from the fund leave the balance stable.
2:40:03 PM
CHAIR BJORKMAN removed his objection; he found no further
objection, and the CS for SB 93, work order 33-LS0538\B, was
adopted as the working document.
2:421:03 PM
CHARLES COLLINS, Director, Division of Workers' Compensation,
which includes the Fishermen's Fund, Department of Labor and
Workforce Development (DOLWD), Juneau, Alaska, testified by
invitation on SB 93. He said the Fishermen's Fund Council tasked
the division with representing their wishes and protecting the
long-standing Fishermen's Fund. The Fund has served commercial
fishermen since inception and the division take the business of
protecting the fund seriously.
2:42:02 PM
VELMA THOMAS, Program Coordinator for the Division of Workers'
Compensation and Administrator for the Fishermen's Fund Advisory
and Appeals Council, Department of Labor and Workforce
Development (DOLWD), Juneau, Alaska, stated that the vessel
owner reimbursement portion of the Fishermen's Fund changed in
2010. In 2012 the benefit cap was $2,500 and the vessel owner
could be reimbursed up to 50 percent. That has not had a
negative effect on the fund. The council requested an increase
in the benefit cap to $10,000. She noted that a House committee
amended the companion bill to provide a $15,000 reimbursement
for the vessel owner and also $15,000 for an injured crew
member. She reviewed the revenue and payouts for nine years,
which included the highest benefit payments and the lowest
revenue stream, and determined the Fund would not be
significantly affected. She explained that the Fishermen's Fund
is self-funded with a percentage of the money from commercial
fishing permits and crew licenses. She stated that the agency's
role is to support the council. It reviews all claims that are
over the fund limit and any claims that request benefits beyond
that. The council also reviews the claims that are denied. The
council members are loyal and enthusiastic about the fund's
management and growth.
2:46:11 PM
SENATOR BISHOP asked if she modeled this research herself.
MS. THOMAS answered that she began the research, and the
division completed the work.
SENATOR BISHOP commented that he was comfortable with the
numbers. He asked Mr. Collins whether he would step up to make
adjustments if the stability of the fund was threatened.
2:46:50 PM
MR. COLLINS answered that the division takes the fund very
seriously and wants to make sure the Fishermens Fund stays
around.
2:47:35 PM
CHAIR BJORKMAN asked what crew members, deck hands, vessel
owners must do to be eligible to receive money from the
Fishermen's Fund.
MS. THOMAS answered that the primary criteria is that the injury
must have occurred in Alaska, and the individual must have a
valid crew member license or permit. The injury or illness must
be related to commercial fishing and treatment must be sought
within 120 days. The grace period used to be 60 days, but the
council found that hardy workers like fishermen prefer to work
through the season, so the treatment period was extended. They
have one year to file a claim. If they are not able to file a
claim, they can then present their case to the council for
consideration. Crew members and vessel owners have ample
opportunities to make claims. Claims are down and the current
system serves as a good support for the commercial fishing
industry.
2:50:39 PM
MR. COLLINS commented that since the fund is a payer of last
resort, the vessel owners would have had to have filed and have
protection and indemnity (P&I) insurance. They would have to
file and the Fishermens Fund would reimburse a part of the
portion that the insurance company was not covering. The fund is
not set up to allow a windfall.
2:51:25 PM
SENATOR GRAY-JACKSON asked what happens if a fishing vessel is
lost at sea.
MR. COLLINS replied that Workers' Compensation is not part of
the conversation; fishers are not covered by Workers
Compensation under the Jones Act. The Fishermen's Fund is the
payer of last resort. If a vessel or crew members are lost at
sea, they hopefully have insurance. The fund would perhaps pay
the deductible or some other cost that the insurance did not
cover.
SENATOR GRAY-JACKSON said she asked because she had a friend who
was on a vessel lost at sea.
2:52:51 PM
CHAIR BJORKMAN asked whether insurance is required in order to
receive money from the fund.
MR. COLLINS answered that the fund is not set up as the
insurance for the industry; it is there to backstop the
insurance. The impetus for the request for this increase is that
the deductibles and the cost of insurance have continually
risen. Vessel owners have opted for higher deductibles to save
money. A lot of vessels work on a shared wage/reward but it is a
dangerous occupation, so while a vessel owner may carry
insurance it may have a fairly high deductible. The purpose of
SB 93 is to help the industry self-regulate and stay healthy.
2:54:06 PM
CHAIR BJORKMAN opened public testimony on SB 93.
2:54:31 PM
TRACY WELCH, Executive Director, United Fishermen of Alaska
(UFA), Petersburg, Alaska, testified in support of SB 93. The
United Fishermen of Alaska support the deductible reimbursement
for vessel owners. The fund is healthy; it is paid for by
fishermen and for fishermen. This is an opportunity to help
fishermen and provide an incentive for them to carry insurance
on their boat and crew. She stated that UFA also supports the
House companion bill.
2:55:57 PM
JERRY MCCUNE, President, Cordova District Fishermen United,
Cordova, Alaska, testified in support of SB 93. He believes that
$15,000 each for the vessel owner and crew members is fair. He
recalled that when the reimbursement was raised to $10,000 for
the fishermen, one could barely walk in the ER for that amount.
Insurance rates have gone up. Keeping the fund solvent is
important.
2:57:28 PM
CHAIR BJORKMAN closed public testimony on SB 93 and held the
bill in committee.