Legislature(2003 - 2004)

04/15/2004 01:51 PM House FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 367                                                                                                            
                                                                                                                                
     An Act relating to the licensing and regulation of sex-                                                                    
     oriented    businesses    and   sex-oriented    business                                                                   
     entertainers; relating  to protection of the  safety and                                                                   
     health of and to education  of young persons who perform                                                                   
     in  adult entertainment  establishments;  and  providing                                                                   
     for an effective date.                                                                                                     
                                                                                                                                
REPRESENTATIVE  LESIL   MCGUIRE,  SPONSOR,  noted   that  the                                                                   
statewide Parent-Teacher-Student  Association (PTSA) passed a                                                                   
resolution asking  the Legislature to  pass a law  to protect                                                                   
under 21-year-old  employees and minors from some  of the ill                                                                   
effects  caused by  strip clubs,  massage  parlors and  other                                                                   
nude entertainment  businesses.  Accordingly, they  worked to                                                                   
help craft HB 367.  Among the  findings in the statewide PTSA                                                                   
resolution, from  a review of studies and court  findings, is                                                                   
a showing that the operation of  sexually oriented businesses                                                                   
(SOB)  leads  to  higher rates  of  crime,  including  sexual                                                                   
assaults, prostitution, drug sales and drug use.                                                                                
                                                                                                                                
Representative  McGuire stated that  the primary goals  of HB
367 are  to permit  the legal  operation of these  businesses                                                                   
while protecting young Alaskans  who work at them, to protect                                                                   
minors, and  to protect the  public from operations  by those                                                                   
adult establishments that do not follow the law.                                                                                
                                                                                                                                
Representative  McGuire  highlighted  the provisions  of  the                                                                   
bill, which would protect the  public and young adults in the                                                                   
following ways:                                                                                                                 
                                                                                                                                
   ·     Prohibits nude entertainment from sharing a common                                                                     
         entrance, restroom  or  hallway  with businesses  or                                                                   
         residences used by minors.                                                                                             
   ·     Prohibits the use of closed private booths where                                                                       
         illegal sexual activities may occur.                                                                                   
   ·     Prohibits the operation of sexually oriented                                                                           
         businesses by those with felony  records, or records                                                                   
         involving   sexually   related,   drug-related,   or                                                                   
         violence-related crimes.                                                                                               
   ·     Prohibits the employment of nude or semi nude                                                                          
         entertainers under the age of 19.                                                                                      
   ·     Requires entertainers to obtain a license, and                                                                         
         prove they  have attended  a  State approved  course                                                                   
         teaching the entertainer how to  protect her/himself                                                                   
         from  sexual   assault;   and   a  course   teaching                                                                   
         entertainers   of   wage   and   working   condition                                                                   
         violations that occur in that area of business.                                                                        
   ·     Requires entertainers under 21 years old to show                                                                       
         they  have  attended  a  State-approved   counseling                                                                   
         session that is  aimed at letting young  adults know                                                                   
         of career  and educational  alternatives,  financial                                                                   
         aid and  vocational  training available  to them  as                                                                   
         viable options to entering or remaining  in a career                                                                   
         in  adult  entertainment.     While  it   is  likely                                                                   
         unconstitutional to ban all 21 year  olds from these                                                                   
         jobs, it  is important  that young  adults at  least                                                                   
         know about other  life options.   Many young  adults                                                                   
         who enter into  these careers come  from backgrounds                                                                   
         where those options are not generally discussed.                                                                       
   ·     Entertainers under age 21 shall also be required to                                                                    
         show they  have  taken  a state-approved  course  on                                                                   
         sexually transmitted diseases.                                                                                         
   ·     Businesses and entertainers are required to obtain                                                                     
         licenses  to  show  these  requirements   have  been                                                                   
         followed.   The State,  as it does  in other  areas,                                                                   
         will set the  license fees at  a level to  cover the                                                                   
         State's costs of administration and enforcement.                                                                       
   ·     Communities shall be apprised of adult business                                                                        
         license  applications   through  reasonable   public                                                                   
         notice rules.                                                                                                          
   ·     Allows suspension of an adult entertainment                                                                            
         business  license  if  provisions  of  the  law  are                                                                   
         knowingly violated.                                                                                                    
                                                                                                                                
Representative McGuire  pointed out the faxed  testimony from                                                                   
Shawn Ruggley,  who spent  many years  dancing in teen  strip                                                                   
clubs.  Ms.  Ruggley mentions that the selling  and buying of                                                                   
drugs is intermingled  within that scene; it is  almost as if                                                                   
the two were one in the same.  (Copy on File).                                                                                  
                                                                                                                                
Representative  Hawker  MOVED  to ADOPT  Amendment  #1,  #23-                                                                   
LS1394\X.2,  Craver,  4/15/04.   (Copy  on File).    Co-Chair                                                                   
Williams OBJECTED for the purpose of discussion.                                                                                
                                                                                                                                
Representative  McGuire explained  that the  amendment was  a                                                                   
collection of all  the changes made to the bill  in an effort                                                                   
to  garner  support.     It  eliminates  references   to  age                                                                   
restrictions.   Some of the changes  come as a  reflection on                                                                   
Supreme Court rulings  that would cause legal  expense and be                                                                   
challenged.   She pointed out  that most of the  changes were                                                                   
to the age requirement.                                                                                                         
                                                                                                                                
Representative Hawker MOVED to  add a "friendly" amendment to                                                                   
Amendment  #1,  Page  11,  Line   6,  deleting  "public"  and                                                                   
inserting "pubic".   There being NO OBJECTION,  the amendment                                                                   
was amended.                                                                                                                    
                                                                                                                                
                                                                                                                                
TAPE HFC 04 - 84, Side B                                                                                                      
                                                                                                                                
                                                                                                                                
OFFICER   PABLO   PAIZ,   (TESTIFIED   VIA   TELECONFERENCE),                                                                   
ANCHORAGE  POLICE DEPARTMENT,  ANCHORAGE, spoke  in favor  of                                                                   
the legislation.   He was  disappointed with the  language of                                                                   
the amendment as  he thought it would "water  down" the bill.                                                                   
He commented that  he has witnessed the plight  of many young                                                                   
dancers who are victims to their  employment.  In addition to                                                                   
the  employing,  many  employers  house  them.    Having  the                                                                   
businesses being  licensed and  regulated would keep  them on                                                                   
the up and up.                                                                                                                  
                                                                                                                                
DON  HUDSON,   (TESTIFIED  VIA  TELECONFERENCE),   PHYSICIAN,                                                                   
ALASKA REGIONAL  HOSPITAL, ANCHORAGE, voiced his  support for                                                                   
the bill, voicing concern that  it had been watered down.  He                                                                   
commented on  the dramatic  increase of sexually  transmitted                                                                   
diseases  that many  of the young  girls are  treated for  at                                                                   
local  hospitals.    These  girls  are  frequently  pregnant,                                                                   
having multiple  complications.  He  assessed that this  is a                                                                   
sad  commentary   on   the  life  of   these  young   people,                                                                   
reiterating his support for the bill.                                                                                           
                                                                                                                                
CAROL  HARTMAN,  (TESTIFIED  VIA  TELECONFERENCE),  CO-OWNER,                                                                   
FANTASIES,    ANCHORAGE,   spoke    strongly   against    the                                                                   
legislation.   She  stated that  she owns a  business in  the                                                                   
industry  and thought  that  the bill  should  not have  been                                                                   
brought  forward.    The  industry   was  excluded  from  the                                                                   
discussions  that formulated  the  bill.   She believed  that                                                                   
these issues  should have  been addressed  at a local  level.                                                                   
There are already  municipal codes which grandfather  in this                                                                   
industry  including  specific  requirements.   She  mentioned                                                                   
that they would not be against  regulating the industry if it                                                                   
was  handled  fairly,  making  a better  business  world  for                                                                   
everyone.  The concern is with over-regulation.                                                                                 
                                                                                                                                
Ms. Hartman added that many of  the alleged referenced abuses                                                                   
took place  years ago  when current laws  were not  in place.                                                                   
She  added  that  the  situation   in  Anchorage  is  totally                                                                   
different than those in the large  cities in the Lower forty-                                                                   
eight states and  that mishandling in the  Alaskan businesses                                                                   
is  unproven.   She emphasized  that there  are no  secondary                                                                   
effects from this business.                                                                                                     
                                                                                                                                
Ms.  Hartman  disliked  being  called  a  "sexually  oriented                                                                   
business".   She  stressed  that  there is  no  "sex" in  the                                                                   
industry.  She  asked for specific information  that could be                                                                   
substantiated.   She referred to the reference  regarding the                                                                   
high  rate of  sexually  transmitted diseases,  pointing  out                                                                   
that  the  North  Slope  area   has  the  highest  amount  of                                                                   
Chlamydia in the  nation.  She asked if all  those girls were                                                                   
dancers.   She  claimed that  the legislation  was harsh  and                                                                   
asked that it be reconsidered.                                                                                                  
                                                                                                                                
KARA  NYQUIST,  (TESTIFIED  VIA   TELECONFERENCE),  ATTORNEY,                                                                   
DIRECTOR  OF  COVENANT  HOUSE,  ANCHORAGE,  spoke  in  strong                                                                   
support  of HB  367.   She  noted that  she  had worked  with                                                                   
Representatives  McGuire and  Gara on  the legislation.   She                                                                   
offered a  brief legal description  of her experience  on the                                                                   
issue.  The Alaska Supreme Court  and the U. S. Supreme Court                                                                   
have recognized  that dancing is constitutionally  protected,                                                                   
however,   both   courts  recognize   that   those   judgment                                                                   
restrictions and  that local governments  have the  right and                                                                   
duty to regulate  sexually oriented businesses.   The Supreme                                                                   
Court uses  the term  SOB when  describing those  businesses.                                                                   
She mentioned  the secondary  effects of  this type  of local                                                                   
business  with   increased  crime  including   drug  traffic,                                                                   
prostitution   and  sexual  assault   and  the  increase   of                                                                   
spreading  sexually transmitted  diseases and  wage and  hour                                                                   
violations.                                                                                                                     
                                                                                                                                
Several  of the  minors  interviewed  have spoken  about  the                                                                   
things  that  occurred  to  them when  working  in  clubs  in                                                                   
Anchorage.  Some of the things reported were:                                                                                   
                                                                                                                                
     ·         Required to pay $50 dollars a night to work                                                                      
               at the clubs and if they did not make that                                                                       
               amount they then owed the house;                                                                                 
     ·         Encouraged to do lap dances with no clothing                                                                     
               on;                                                                                                              
     ·         Encouraged to engage in prostitution;                                                                            
    ·         Forced to work in unclean conditions; and                                                                         
     ·         Concluded that 16-year-old girls are engaging                                                                    
               in sex.                                                                                                          
                                                                                                                                
Ms. Nyquist  pointed out that  these things are  happening in                                                                   
Anchorage.   The club owners in  the State should  not employ                                                                   
anyone  under the  age of  21.  She  urged that  the bill  be                                                                   
passed from Committee.                                                                                                          
                                                                                                                                
TERRY  DITTMAN,   (TESTIFIED  VIA  TELECONFERENCE),   PARENT-                                                                   
TEACHER-STUDENT  ASSOCIATION   (PTSA),  ANCHORAGE,  read  the                                                                   
testimony    from    Nancy    Fair,    Parent-Teacher-Student                                                                   
Association,  Service  High  School,  Anchorage.    (Copy  on                                                                   
File).                                                                                                                          
                                                                                                                                
She noted  that they  had spent over  a year researching  the                                                                   
impacts  of the  SOB's, finding  no  benefits, only  negative                                                                   
impacts from  that type  of business to  the children  of the                                                                   
State.   She claimed that  business licensing as  proposed in                                                                   
HB 367  would be an important  step in protecting  the teens.                                                                   
It would  help insure  that underage  teens are not  involved                                                                   
and it would insure that the club owners are not criminals.                                                                     
                                                                                                                                
The PTA  strongly supports raising  the minimum age  for both                                                                   
customers  and strippers to  21 years.   Raising the  minimum                                                                   
age would  not be  inconsistent with  supporting the  minimum                                                                   
voting and military age requirements.                                                                                           
                                                                                                                                
Ms. Dittman added  that participation in SOB's  is frequently                                                                   
a pathway  to drug  and alcohol  addiction and  prostitution.                                                                   
Use  of   drugs  and   alcohol  contributes   to  an   unsafe                                                                   
environment  for teens.   Many of the  customers at  the non-                                                                   
liquor strip clubs  arrive intoxicated.  Strip  clubs without                                                                   
a liquor licenses  have no designated closing  times, so when                                                                   
the bars  close a "rush"  of intoxicated customers  appear in                                                                   
the clubs and interact with the under-aged clients.                                                                             
                                                                                                                                
Ms.  Dittman  added  other  benefits of  the  bill  would  be                                                                   
statewide   jurisdiction,  so   that   all  communities   are                                                                   
protected.     She   strongly   encouraged   review  of   the                                                                   
legislation,  as the industry  is detrimental to  individuals                                                                   
and to the communities.                                                                                                         
                                                                                                                                
ANDREE  MCLEOD, (TESTIFIED  VIA  TELECONFERENCE),  ANCHORAGE,                                                                   
testified  in opposition  to the legislation  because  of the                                                                   
manner in which  it was drafted.  She stated that  she is not                                                                   
in favor of  allowing high school students to  participate in                                                                   
stripping, but  maintained that  the process did  not include                                                                   
the  industry  members  when   formulating  the  bill.    The                                                                   
industry has offered to address  the issues of employing high                                                                   
school students.  Ms. McLeod emphasized  that this is a local                                                                   
issue and  observed that men and  women over 18 years  of age                                                                   
have the right to make their own decisions.                                                                                     
                                                                                                                                
Ms.  McLeod   recommended  that  the  operations   should  be                                                                   
regulated around the  State but that the young  people in the                                                                   
18-21 year  old range  are able to  make their own  decisions                                                                   
without the interference of State government.                                                                                   
                                                                                                                                
DIANA  L.  STRAUB, (TESTIFIED  VIA  TELECONFERENCE),  PARENT-                                                                   
TEACHER ASSOCIATION, ASSEMBLY  MEMBER, WASILLA, voiced strong                                                                   
support for  the bill.   Through  the licensing process,  the                                                                   
public will have  the ability to comment.   The public should                                                                   
have the right to comment during  the renewal process and the                                                                   
community  would  be able  to  participate in  the  licensing                                                                   
process.   It is valuable  that the  public can revoke  these                                                                   
licenses.                                                                                                                       
                                                                                                                                
Ms. Straub recommended that the  licensing process mirror the                                                                   
liquor  licensing  process  and   be  regularly  checked  for                                                                   
compliance.   Requests for application  could be  approved or                                                                   
rejected  by   the  State  for  incompliance.     Ms.  Straub                                                                   
recommended that  parole be added on  Page 4, Line 7  & 8 and                                                                   
on Page 5, Line 10, also inserting cities and boroughs.                                                                         
                                                                                                                                
REGINA  MANTEUFEL,  (TESTIFIED  VIA  TELECONFERENCE),  FORMER                                                                   
STRIPPER,   ANCHORAGE,   voiced   strong  support   for   the                                                                   
legislation.   She urged  that the patrons  be 21  years old.                                                                   
She noted  that she first  started dancing for  the military.                                                                   
Those clients tend  to be very rude and often  would grab the                                                                   
dancers.  She pointed out that  many dancers have stage names                                                                   
to protect themselves from being followed.                                                                                      
                                                                                                                                
Ms. Manteufel  discussed labor laws  that a person  cannot be                                                                   
paid a  shift rate  to work.   Dancers  cannot be paid  their                                                                   
stage tips  to work.  Any stage  tip is considered  a tip and                                                                   
it  is illegal  that  the  owners of  the  club  use that  to                                                                   
suffice minimum  wage.  She  claimed that is  done everywhere                                                                   
and that it is illegal to have a shift-pay.                                                                                     
                                                                                                                                
Ms.  Manteufel recommended  that  the Department  of Labor  &                                                                   
Workforce  Development visit the  clubs twice  a year  and go                                                                   
over the labor  laws with the dancers,  including information                                                                   
on making a wage claim.                                                                                                         
                                                                                                                                
Ms.  Manteufel  did not  support  young girls  table  dancing                                                                   
naked.   She stressed  that there  should be  no naked  table                                                                   
dancing  at any  age.   The original  bill contains  one-hour                                                                   
assertiveness  training,  which  she thought  would  be  cost                                                                   
effective for all clubs.                                                                                                        
                                                                                                                                
Ms. Manteufel  referenced the  domestic violence  records for                                                                   
the  State  of Alaska,  pointing  out  that the  men  abusing                                                                   
between  the  ages  18-21  years   old  are  usually  in  the                                                                   
military.                                                                                                                       
                                                                                                                                
                                                                                                                                
TAPE HFC 04 - 85, Side A                                                                                                      
                                                                                                                                
                                                                                                                                
Ms.  Manteufel concluded  her  testimony  and reiterated  her                                                                   
support for the bill.                                                                                                           
                                                                                                                                
KATHY  HARTMAN, (TESTIFIED  VIA  TELECONFERENCE),  CO-OWNERS,                                                                   
FANTASIES, ANCHORAGE, spoke against  the passage of the bill.                                                                   
She  referenced  the packet  in  member's  files.   (Copy  on                                                                   
File).  She  noted that her business  is in the Union  and is                                                                   
audited every year for workmen's  compensation.  She stressed                                                                   
that  much  of the  testimony  is  off  base.   Much  of  the                                                                   
information  is being provided  from very  old surveys.   She                                                                   
claimed that the "deep" research  performed by Representative                                                                   
McGuire  was not true.   She  responded to  comments made  in                                                                   
previous testimony.                                                                                                             
                                                                                                                                
Ms. Hartman pointed out that there  are only six of this type                                                                   
business in the  Northern Alaskan area.  The  Municipality of                                                                   
Anchorage and Matsu  have laws on the books  regulating them.                                                                   
Currently,  these  businesses  are  required to  do  all  the                                                                   
reporting  that other  businesses  are required  to  provide.                                                                   
She  strongly  urged   that  the  bill  not   be  moved  from                                                                   
Committee.                                                                                                                      
                                                                                                                                
Representative  Hawker MOVED  a conceptual  to Amendment  #1,                                                                   
Page 2, Line 15, inserting language:                                                                                            
                                                                                                                                
     (4)       Information on the State's wage and labor                                                                        
               laws as it pertains to the entertainer's                                                                         
               employment.                                                                                                      
                                                                                                                                
There  being  NO  OBJECTION,  the  conceptual  amendment  was                                                                   
adopted.                                                                                                                        
                                                                                                                                
Vice Chair  Meyer inquired  how performances  in places  like                                                                   
the Performing  Arts Center and  out-door theatres  that from                                                                   
time to time  offer presentations where clothing  is removed,                                                                   
would be handled.                                                                                                               
                                                                                                                                
Representative  McGuire  responded  that the  sponsor's  were                                                                   
careful  in drafting  the legislation  that those  situations                                                                   
were  not  included.   There  is  a definition  on  Page  10,                                                                   
outlining  an  adult  oriented  business  and  operating  for                                                                   
compensation.   She added that sexually oriented  business is                                                                   
a  legally tested  term  words  used throughout  the  Supreme                                                                   
Court documentation.                                                                                                            
                                                                                                                                
Co-Chair  Harris MOVED  to  report  CS HB  367  (FIN) out  of                                                                   
Committee  with  individual  recommendations   and  with  the                                                                   
accompanying fiscal notes.  There  being NO OBJECTION, it was                                                                   
so ordered.                                                                                                                     
                                                                                                                                
CS  HB 367  (FIN)  was reported  out  of Committee  with  "no                                                                   
recommendation" and with a new  fiscal note by the Department                                                                   
of Community &  Economic Development, a new zero  note by the                                                                   
Department  of  Public  Safety   and  zero  note  #2  by  the                                                                   
Department of Labor & Workforce Development.                                                                                    
                                                                                                                                

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