04/22/2024 01:30 PM Senate FINANCE

SENATE BILL NO. 204                                                                                                           
                                                                                                                                
     "An  Act relating  to the  issuance of  certificates of                                                                    
     fitness  for  plumbers  and electricians;  relating  to                                                                    
     fees  for  certificates  of fitness  for  plumbers  and                                                                    
    electricians; and providing for an effective date."                                                                         
                                                                                                                                
2:13:02 PM                                                                                                                    
                                                                                                                                
CATHY MUNOZ, COMMISSIONER, DEPARTMENT OF LABOR AND                                                                              
WORKFORCE DEVELOPMENT, introduced SB 204.                                                                                       
                                                                                                                                
2:15:30 PM                                                                                                                    
                                                                                                                                
SCOTT  DAMEROW, CHIEF  OF MECHANICAL  INSPECTION, DEPARTMENT                                                                    
OF   LABOR  AND   WORKFORCE   DEVELOPMENT,  ANCHORAGE   (via                                                                    
teleconference),  discussed  the  presentation,  "SB  204  -                                                                    
Certificate   of   Fitness:   Plumbers/Electricians   Senate                                                                    
Finance Committee" (copy on file).                                                                                              
                                                                                                                                
Mr. Damerow addressed slide 2, "Proposal":                                                                                      
                                                                                                                                
     This legislation would:                                                                                                    
     • Change trainee certificate of fitness durations from                                                                     
     two-to six-years                                                                                                           
          o No change to the $200 fee for this license                                                                          
     • Increase the fees for journey-level licenses from                                                                        
     $200 biennially to $300 biennially                                                                                         
                                                                                                                                
Mr. Damerow highlighted slide 3, "Why the Change":                                                                              
                                                                                                                                
     Trainee certificate of fitness holders (enrolled in                                                                        
     the federal apprenticeship program) often lapse their                                                                      
     license during their apprenticeship. This results in:                                                                      
          • Time worked that cannot be counted towards the                                                                      
          journeyman license                                                                                                    
          • Administrative delays in processing licenses                                                                        
          • Delays in becoming a journeyman                                                                                     
                                                                                                                                
Mr. Damerow pointed to slide 4, "Mechanical Inspection                                                                          
Active Licenses":                                                                                                               
                                                                                                                                
     Active licenses on 1/1/2024:                                                                                               
       AA Asbestos Abatement                                                                                                    
       B1-4Boiler Operator Class 1-4                                                                                            
       EJ Electrician Journeyman                                                                                                
       ER Electrician Residential                                                                                               
       ET Electrician Trainee                                                                                                   
       HP Hazardous Paint                                                                                                       
       LJ Lineman Journeyman                                                                                                    
       LT Lineman Trainee                                                                                                       
       PG Plumber Gas                                                                                                           
       PJ Plumber Journeyman                                                                                                    
       PR Plumber Residential                                                                                                   
       PT Plumber Trainee                                                                                                       
       PU Plumber Utility                                                                                                       
       XH Explosive Handler                                                                                                     
                                                                                                                                
Mr. Damerow looked at slide 5, "New Licenses Issued by Type                                                                     
and Year 2019-2023."                                                                                                            
                                                                                                                                
Mr. Damerow highlighted slide 6, "Plumbing Licenses Issued                                                                      
by year: 2019-2023."                                                                                                            
                                                                                                                                
Mr. Damerow pointed to slide 7, "Electrical Licenses Issued                                                                     
by year: 2019-2023."                                                                                                            
                                                                                                                                
Mr. Damerow looked at slide 8, "Other Licenses Issued by                                                                        
year: 2019-2023."                                                                                                               
                                                                                                                                
Mr. Damerow discussed slide 9, "Trainee Requirements":                                                                          
                                                                                                                                
     Requirements for a journeyman plumber or electrician                                                                       
     license are similar:                                                                                                       
      Completion of 8,000 legally obtained on-the-job hours                                                                     
          o May include 1,000 classroom hours                                                                                   
          o Hours are submitted on one or more 'Experience                                                                      
          Verification Forms'                                                                                                   
      Passing score of 70% or better on the exam                                                                                
      Payment of $200 fee                                                                                                       
                                                                                                                                
Mr. Damerow addressed slide 10, "Trainee Barriers":                                                                             
                                                                                                                                
     Barriers that can make it difficult to obtain a                                                                            
     journeyman license:                                                                                                        
         Employers   do   not   complete   the   'Experience                                                                    
     Verification Form' correctly                                                                                               
       Employers are not available to complete the                                                                              
     'Experience Verification Form'                                                                                             
       Some of the hours worked were not legally obtained                                                                       
          o Maintenance hours may not be counted                                                                                
          o Trainee certificate of fitness was lapsed when                                                                      
          the hours were worked                                                                                                 
                                                                                                                                
Mr. Damerow displayed slide 11, "Lapsed Trainee Card                                                                            
Hours":                                                                                                                         
                                                                                                                                
     In the period from 2019                                                                                                    
     -2023:                                                                                                                     
       Electrical trainee license days lapsed:21,142(57.9                                                                       
     years)                                                                                                                     
          o Average number of licensees affected per year:                                                                      
          51.6                                                                                                                  
          o Average days lapsed for each affected                                                                               
          licensee:81.9                                                                                                         
                                                                                                                                
     Plumbing trainee license days lapsed:15,513(42.5                                                                           
     years)                                                                                                                     
          o Average number of licensees affected per year:                                                                      
          28.8                                                                                                                  
          o Average days lapsed for each affected                                                                               
          licensee:107.7                                                                                                        
                                                                                                                                
2:20:52 PM                                                                                                                    
                                                                                                                                
Mr. Damerow looked at slide 12, "Trainee Card Renewal                                                                           
Requirements":                                                                                                                  
                                                                                                                                
     Renewal of a two-year trainee certificate of fitness:                                                                      
       Pay $200 renewal fee                                                                                                     
                                                                                                                                
Mr. Damerow discussed slide 13, "Impact":                                                                                       
                                                                                                                                
     The proposed change to duration and fees would:                                                                            
        Lower  the  cost   of  apprenticeship  programs  for                                                                    
     plumbers and electricians                                                                                                  
       Reduce administrative requirement  to renew a trainee                                                                    
     certificate   of   fitness   in  the   middle   of   an                                                                    
     apprenticeship                                                                                                             
       Result in much less time lost due to lapsed licenses                                                                     
     Results:                                                                                                                   
        Incentivize   more  workers   to  enter   the  trade                                                                    
     apprenticeship programs                                                                                                    
        Shift  the  financial   burden  to  the  higher-paid                                                                    
     journey-level workers                                                                                                      
        Allow   apprentices  to  "journey  out"   faster  by                                                                    
     removing lapsed periods                                                                                                    
                                                                                                                                
Mr. Damerow pointed to slide 14, "Proposed Fee Changes":                                                                        
                                                                                                                                
     Fee change results:                                                                                                        
     •  $164.5  average increase  in  annual  fees based  on                                                                    
     2019-2023 data                                                                                                             
     • $58.75 average annual savings for trainees                                                                               
     •  Trainee  licenses  will cost  $200  for  the  entire                                                                    
     apprenticeship rather than the current $400                                                                                
                                                                                                                                
Mr. Damerow looked at slide 15, "Reasoning for Proposed Fee                                                                     
Increase":                                                                                                                      
                                                                                                                                
     The primary purpose of the  proposed fee increase is to                                                                    
     offset  the  proposed  lack  of  renewals  for  trainee                                                                    
     licenses                                                                                                                   
                                                                                                                                
     This number was selected to  compensate for the lack of                                                                    
     fee increases since 2006                                                                                                   
     $200                                                                                                                       
          -$300 fee change matches the Consumer Price Index                                                                     
          from 2006-2023                                                                                                        
          Mechanical Inspection is self                                                                                         
          -funded from program receipts                                                                                         
                                                                                                                                
Co-Chair Olson OPENED and CLOSED public testimony.                                                                              
                                                                                                                                
SB 204 was HEARD and HELD in committee for further                                                                              
consideration.