01/31/2012 01:30 PM Senate LABOR & COMMERCE

         SB 155-EXTENDING CERTAIN BOARDS & COMMISSIONS                                                                      
                                                                                                                                
2:05:22 PM                                                                                                                    
CHAIR EGAN  announced SB 155  [labeled 27-LS1006\B] to be  up for                                                               
consideration.                                                                                                                  
                                                                                                                                
2:05:40 PM                                                                                                                    
REPRESENTATIVE HAWKER  said he is  here today in his  capacity as                                                               
chairman of  the Legislative Budget  and Audit  Committee (LB&A),                                                               
sponsor  of  SB 155.  He  explained  that  this is  the  official                                                               
reauthorization of various boards  and commissions whose terms of                                                               
existence have expired in accordance  with statute. He added that                                                               
our boards  and commissions are  placed in statute on  a temporal                                                               
basis  requiring they  come back  up before  the legislature  for                                                               
review and reconsideration on a cyclical basis.                                                                                 
                                                                                                                                
The bill contains  six boards and commissions.  Four are familiar                                                               
having  rolled through  the Senate  Labor and  Commerce Committee                                                               
last year. They  made it through legislative  process and reached                                                               
the governor's desk  but he was uncomfortable  with the provision                                                               
that  had been  added in  Senate Finance  that was  essentially a                                                               
policy decision involving judicial  matters that had not received                                                               
a  full  vetting  in  front  of  a  Judiciary  Committee  in  the                                                               
legislature. So he vetoed the  bill knowing another year remained                                                               
to reconsider it.                                                                                                               
                                                                                                                                
REPRESENTATIVE HAWKER  said the  bill before  them does  not have                                                               
any  policy  decisions  other than  the  reauthorization  of  the                                                               
various  boards  and  commissions,   specifically  the  Board  of                                                               
Barbers  and Hairdressers  through June  19, 2019;  the Board  of                                                               
Dental  Examiners through  June 30,  2019; the  Board of  Nursing                                                               
through June 30,  2019; and the Alcoholic  Beverage Control Board                                                               
through June 30, 2015. They are  seeing those for the second time                                                               
as a result of the situation he just described.                                                                                 
                                                                                                                                
The  two they  have  not seen  yet are  the  Big game  Commercial                                                               
Services  Board through  June  30, 2016  and  the Alaska  Seismic                                                               
Hazards   Safety   Commission   through  June   30,   2016.   The                                                               
reauthorization   dates  are   recommended  by   the  Legislative                                                               
Auditor.                                                                                                                        
                                                                                                                                
He  noted  that  the  fairly  near-term  date  of  the  Alcoholic                                                               
Beverage Control  Board (ABC) relates  to the short leash  it has                                                               
been on  because of  numerous issues  identified by  the auditor.                                                               
The board has responded to  the concerns raised, but extending it                                                               
to the 2014 date  will put them back on course  for a more normal                                                               
reauthorization.                                                                                                                
                                                                                                                                
REPRESENTATIVE  HAWKER said  they  have a  new state  legislative                                                               
auditor, because  Pat Davidson  who served  in that  capacity for                                                               
over   30  years   retired  last   December.  The   acting  state                                                               
legislative auditor is  Kris Curtis, who also has  a long history                                                               
in the agency.                                                                                                                  
                                                                                                                                
2:10:41 PM                                                                                                                    
KRISTIN  CURTIS,  Division   of  Legislative  Audit,  Legislative                                                               
Affairs  Agency, Alaska  State Legislature,  said SB  155 extends                                                               
the termination dates  for six boards and  commissions. They have                                                               
performed  sunset  audits for  all  the  entities. The  Board  of                                                               
Barbers and Hairdressers,  the Board of Dental  Examiners and the                                                               
Board of Nursing  were completed before the end of  2010 and were                                                               
discussed  before this  committee last  year. She  concluded they                                                               
served   a   public   purpose  and   should   be   extended   and                                                               
recommendations for extension are the same dates in SB 155.                                                                     
                                                                                                                                
Their  last full  sunset audit  of the  ABC Board  is dated  July                                                               
2009.  However, they  followed up  with the  board last  year and                                                               
again this month  regarding the status of  implementing the audit                                                               
recommendations.  The  audit in  2009  concluded  that the  board                                                               
should be  extended and  did serve a  public need.  However, they                                                               
made   several    recommendations   to   improve    the   board's                                                               
effectiveness and efficiency.                                                                                                   
                                                                                                                                
2:11:33 PM                                                                                                                    
She   said  they   recommended   a   stronger  internal   control                                                               
environment  be  implemented  to  include  written  policies  and                                                               
operational  procedures as  well  as a  strategic plan  governing                                                               
enforcement activities.  Since that  time many  improvements have                                                               
been   made,   and   their  prior   recommendations   have   been                                                               
substantially implemented, except  one outstanding recommendation                                                               
concerning licensing  revenue. Their prior  recommendation stated                                                               
that  licensing fee  revenues recorded  in the  ABC board's  data                                                               
base did  not agree with,  nor was  it reconciled with,  the same                                                               
revenue  recorded   in  the   state's  accounting   system.  That                                                               
deficiency   continues  to   exist.  They   have  contacted   the                                                               
Department   of  Public   Safety's  Division   of  Administrative                                                               
Services  to  ask the  status  and  they  stated there  has  been                                                               
turnover in  their fiscal  staff that  has delayed  resolving the                                                               
finding. But they are currently working on addressing it.                                                                       
                                                                                                                                
MS.  CURTIS said  the sunset  review of  the Big  Game Commercial                                                               
Services Board is dated September  2011; the purpose of the audit                                                               
was to  determine if the board  should be extended and  if it was                                                               
serving in the public's interest.  They recommended a termination                                                               
date for  the board be  extended until  June 30, 2016.  The board                                                               
has served  a public interest  by providing  reasonable assurance                                                               
that those  individuals licensed  to guide, outfit  and transport                                                               
were qualified to  do so, and the board  has successful developed                                                               
and  adopted   regulatory  changes   to  improve  the   big  game                                                               
commercial services  industry. The  four-year extension  is based                                                               
the board not fully implementing  prior audit recommendations and                                                               
the   less  than   sufficient  services   by   the  Division   of                                                               
Corporations, Business  and Professional Licensing in  support of                                                               
the board's operations.                                                                                                         
                                                                                                                                
She said the  sunset report contained one  new recommendation and                                                               
five repeats.  The new recommendation  address the  poor security                                                               
controls over electronic and paper  versions of confidential hunt                                                               
records.  This  information  is  maintained  as  confidential  by                                                               
statute.  However, the  division  does not  have  staff with  the                                                               
technical  capabilities  to  restrict access  to  the  electronic                                                               
records and does  not have policies and procedures  to ensure the                                                               
physical files are adequately safeguarded.                                                                                      
                                                                                                                                
MS. CURTIS  said the  repeat recommendations  cover a  variety of                                                               
issues  including poor  operational  support by  the division  in                                                               
both the  administrative and  investigative areas.  Licensee fees                                                               
continue to  be insufficient to  support the  board's operations.                                                               
At the end  of FY11 there was a deficit  of almost $375,000. They                                                               
again recommended that first aid  requirements be made consistent                                                               
between the various licensee types.  And finally, the board still                                                               
wants to  maintain a data base  of hunt records and  reports, and                                                               
this  takes a  significant amount  of administrative  time. Given                                                               
the fiscal condition of the board,  they question whether it is a                                                               
prudent use of  resources, given the little value  they have been                                                               
able to demonstrate.                                                                                                            
                                                                                                                                
2:15:16 PM                                                                                                                    
MS. CURTIS  said the  sunset audit of  the Alaska  Seismic Hazard                                                               
Safety Commission is  dated June 2011. The purpose  of the review                                                               
was again to determine if  the termination date of the commission                                                               
should be extended.  They found that it  is operating effectively                                                               
and  is serving  a  public purpose.  Therefore, they  recommended                                                               
extending  the  commission  until   June  30,  2016.  The  report                                                               
contained  four recommendations:  that the  commission develop  a                                                               
strategic plan  to guide its  efforts to mitigate  seismic hazard                                                               
risks in Alaska;  develop procedures to ensure  public notices of                                                               
meetings are  published timely;  follow its  procedures regarding                                                               
habitually absent members  and the Office of  the Governor should                                                               
fill appointments to the commission in a timely manner.                                                                         
                                                                                                                                
2:16:24 PM                                                                                                                    
ROD  COMBELLICK,  Deputy  Director, Division  of  Geological  and                                                               
Geophysical  Surveys,  Department  of  Natural  Resources  (DNR),                                                               
Fairbanks, said he was available to answer questions on SB 155.                                                                 
                                                                                                                                
MICHAEL O'HARE, Deputy Director,  Homeland Security and Emergency                                                               
Management,  Department of  Military &  Veterans Affairs  (DMVA),                                                               
said  they supported  section 6  for the  Seismic Hazards  Safety                                                               
Commission and offered to answer questions on SB 155.                                                                           
                                                                                                                                
2:17:32 PM                                                                                                                    
SHIRLEY  GIFFORD,  Director,  Alcoholic Beverage  Control  Board,                                                               
said she  supported SB 155.  She said  she has been  director for                                                               
the past three  years; prior to that she was  an ABC board member                                                               
and  has  a  fairly  good  understanding  of  its  importance  in                                                               
controlling the manufacturing,  selling, bartering and possessing                                                               
of alcoholic beverages in the state.  She asked that the board be                                                               
extended. They are  currently in a wind-down year  and don't have                                                               
a sunset. They  have done a lot  of work in the  past three years                                                               
in  trying to  respond  to the  audit's  recommendations. If  the                                                               
board is  not extended they  would take giant steps  backwards in                                                               
controlling alcoholic beverages in the state.                                                                                   
                                                                                                                                
She said  they had made  many positive changes within  the agency                                                               
and  have several  new employees,  "a kind  of transfusion,"  and                                                               
things  are  working very  well.  The  employees are  proficient,                                                               
professional and courteous.                                                                                                     
                                                                                                                                
MS.  GIFFORD  said  they  had received  some  feedback  from  the                                                               
industry  about dissatisfaction  with the  board, aside  from the                                                               
legislative audit and  she wanted to respond to them,  as well as                                                               
the auditor's  recommendations. She  developed a survey  and sent                                                               
1,439 of  them to industry  members and after about  three months                                                               
got 257 returned,  an 18 percent return. She  understood that was                                                               
fairly decent for a mail-in survey.                                                                                             
                                                                                                                                
MS. GIFFORD  said she was very  pleased with the results  of that                                                               
survey. In  all rated categories  from very poor to  superior the                                                               
licensing  staff  of  the  ABC  Board  scored  above  average  to                                                               
superior.  In   all  rated  categories  from   strongly  disagree                                                               
to strongly agree in areas  such as the investigator demonstrated                                                               
respect,  the investigator  explained the  purpose of  the visit,                                                               
the   investigator  was   knowledgeable,  the   investigator  was                                                               
professional and appropriate. The  enforcement staff scored agree                                                               
to strongly  agree and in  one category  rated from very  poor to                                                               
superior - i.e. if the contact  was in response to the licensee's                                                               
request and the process of  getting the licensee's issue resolved                                                               
- the enforcement staff rated above average.                                                                                    
                                                                                                                                
She  said she  was using  the surveys  as a  tool to  enhance the                                                               
abilities  within  the  agency and  has  scheduled  some  service                                                               
excellence training; the  first one is in Fairbanks  in the first                                                               
week of  February; the next one  is in Anchorage and  then one in                                                               
Juneau.                                                                                                                         
                                                                                                                                
2:21:30 PM                                                                                                                    
MS. GIFFORD said  that she is currently responding to  one of the                                                               
questions where  65.4 percent of  the respondents  indicated that                                                               
no  improvement   was  needed.  But  further   down,  some  small                                                               
percentages indicated  issues had to be  explained several times,                                                               
the employee  didn't know the  answers to their questions  or the                                                               
employee had  to ask others. So  she has instituted a  reading of                                                               
Title 4  into staff meetings  and discussion about what  it means                                                               
and  how it  should be  applied. It's  a complicated  title about                                                               
which they  get frequent calls  from attorneys asking  for advice                                                               
on how to interpret.                                                                                                            
                                                                                                                                
She reported  that they  attained their  goals of  percentages in                                                               
all eight  designated regions  around the state  and this  is the                                                               
first  time that  has happened.  It meant  from FY2010  to FY2011                                                               
that they completed 104 additional  compliance checks on licensed                                                               
establishments,  and  the  compliance  went  up  from  85  to  88                                                               
percent.  They  have  a  95 percent  compliance  rate  goal  when                                                               
sending their underage buyers in  to try to purchase alcohol that                                                               
the licensee or their employee  doesn't make that sale. Fairbanks                                                               
and  Juneau are  at 93  percent  and the  MatSu Valley  is at  92                                                               
percent.                                                                                                                        
                                                                                                                                
MS.  GIFFORD  said  they  are  doing  some  educational  efforts,                                                               
sending  packets to  all licensees  with "born  on" stickers  and                                                               
calendars and  a CHARR brochure.  They answer questions  daily by                                                               
phone  and  email to  licenses  so  they  can  do what  they  are                                                               
supposed to do - not to  sell to underage persons, which is their                                                               
biggest goal.                                                                                                                   
                                                                                                                                
CHAIR EGAN  said there was  a lot  of discussion last  year about                                                               
sending folks  out for compliance  checks who are under  21 years                                                               
old and  there were  concerns that  sending under-age  people was                                                               
breaking the law.                                                                                                               
                                                                                                                                
MS.  GIFFORD responded  that the  law allows  for them  to employ                                                               
under-age  persons if  they are  under the  supervision of  a law                                                               
enforcement officer.                                                                                                            
                                                                                                                                
2:25:40 PM                                                                                                                    
THOR STACEY,  lobbyist, Alaska Professional  Hunters Association,                                                               
Juneau,  affirmed  their  support  of SB  155,  specifically  the                                                               
reauthorization of the Big Game and Commercial Services Board.                                                                  
                                                                                                                                
2:26:54 PM                                                                                                                    
BOB SWENSON,  State Geologist and Director,  State Geological and                                                               
Geophysical  Surveys,  Department  of  Natural  Resources  (DNR),                                                               
testified  that  the  State  Seismic  Hazards  Commission  is  an                                                               
important part  of the  process of seismic  safety in  the state.                                                               
The  State Geologic  Survey provides  administrative support  for                                                               
this  organization,  and  it also  identifies  hazards  from  the                                                               
geologic perspective.  The Homeland Security group  for the state                                                               
looks at  mitigation from  the public  safety standpoint  and the                                                               
Seismic  Safety  Commission  provides  information  for  building                                                               
safety and legislative policy advice  for improving the safety of                                                               
buildings and infrastructure within the state.                                                                                  
                                                                                                                                
2:27:52 PM                                                                                                                    
SENATOR PASKVAN  asked the status of  recommendation number four,                                                               
filling the appointments.                                                                                                       
                                                                                                                                
MR.  SWENSON  replied all  the  audit  recommendations have  been                                                               
addressed except for the first one, their strategic plan.                                                                       
                                                                                                                                
SENATOR MENARD  asked a  general question  on best  practices for                                                               
boards  and commissions  when members  are causing  a problem  by                                                               
being habitually absent.  Does he put out a message  to all staff                                                               
in the  building to find  out who is  interested in serving  on a                                                               
board? Is  it acceptable  practice to bring  forward a  name that                                                               
wasn't  accepted but  was well  thought of  in the  industry that                                                               
could serve as a good person to be on a board?                                                                                  
                                                                                                                                
2:30:07 PM                                                                                                                    
MR. SWENSON  replied that he is  not the one to  answer that, but                                                               
it's often difficult to find  qualified people with the necessary                                                               
background to serve on the Seismic Hazards Commission.                                                                          
                                                                                                                                
2:31:09 PM                                                                                                                    
SENATOR PASKVAN said recommendation two  for the Board of Barbers                                                               
and  Hairdressers seems  to be  somewhat critical  and asked  the                                                               
status. It  says the  current public  board member  should either                                                               
surrender her license or be  removed from the public board member                                                               
position.  It  seems  to  be  a  pretty  stark  assessment  of  a                                                               
particular person on that board.                                                                                                
                                                                                                                                
2:31:38 PM                                                                                                                    
DON  HABEGER, Director,  Division of  Corporations, Business  and                                                               
Professional  Licensing, Department  of  Commerce, Community  and                                                               
Economic   Development   (DCCED),   replied  that   license   was                                                               
surrendered and a replacement was  sought, but he wasn't familiar                                                               
with the timing.                                                                                                                
                                                                                                                                
SENATOR MENARD asked if that meant the position had been filled.                                                                
                                                                                                                                
MR. HABEGAR  replied that he believed  so, but would get  back to                                                               
the committee about it.                                                                                                         
                                                                                                                                
SENATOR GIESSEL thanked  the committee for hearing  this issue so                                                               
expeditiously on behalf of the  licensees of the four boards that                                                               
were not renewed last year and are facing sunset.                                                                               
                                                                                                                                
SENATOR  GIESSEL  moved  to  report   SB  155,  version  B,  from                                                               
committee  with individual  recommendations  and attached  fiscal                                                               
note(s). There were no objections and it was so ordered.                                                                        
                                                                                                                                
At ease from 2:33:54 to 2:35:32 p.m.