Legislature(2005 - 2006)HOUSE FINANCE 519

04/10/2006 09:00 AM House FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ HB 93 DENTISTS AND DENTAL HYGIENISTS TELECONFERENCED
Heard & Held
+ HB 360 REGULATION OF PUBLIC DRINKING WATER TELECONFERENCED
Heard & Held
+ HB 390 PROPERTY ASSESSMENT APPEAL FEE TELECONFERENCED
Scheduled But Not Heard
+ HB 484 FISHERY ASSOCIATION REIMBURSEMENT TELECONFERENCED
Moved CSHB 484(FSH) Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
HOUSE BILL NO. 360                                                                                                            
                                                                                                                                
     "An Act relating to the regulation of public                                                                               
     accommodation water supply systems."                                                                                       
                                                                                                                                
MICHAEL PAWLOWSKI,  STAFF, CO-CHAIR MEYER, testified  that HB
360   grew   out   of   the   Department   of   Environmental                                                                   
Conservation's (DEC) subcommittee  budget process.  The State                                                                   
of Alaska regulates  drinking water systems that  are above a                                                                   
Class  C well,  one  that serves  less than  25  people.   He                                                                   
explained  that Class  C wells were  removed from  regulation                                                                   
because of  funding issues  and because  the program  was too                                                                   
broad.   He  stated  that these  types  of  wells pertain  to                                                                   
private homes.  He noted that  the committee became concerned                                                                   
in the differentiation between  private homes and more public                                                                   
access  areas.   He  stressed  that  drinking water  was  the                                                                   
foundation of  public health.   The bill  is intended  to set                                                                   
standards  for  wells that  serve  the  general public.    He                                                                   
pointed out  the revised fiscal  note from the  Department of                                                                   
Environmental Conservation.                                                                                                     
                                                                                                                                
Co-Chair Meyer asked  what kinds of  small wells  would serve                                                                   
the public.   Mr. Pawlowski commented that  small restaurants                                                                   
would be  such an example.   Co-Chair Meyer noted  that there                                                                   
was no  regulation for  wells serving  fewer than 25  people,                                                                   
and  that this  was  a problem  when a  small  well served  a                                                                   
public day care or other small public facility.                                                                                 
                                                                                                                                
9:55:14 AM                                                                                                                    
                                                                                                                                
Mr.  Pawlowski noted  that  requesting an  annual  test of  a                                                                   
drinking  water  source  was   a  reasonable  practice.    He                                                                   
stressed that  the state ought  be part of the  oversight for                                                                   
public drinking water.                                                                                                          
                                                                                                                                
9:56:00 AM                                                                                                                    
                                                                                                                                
Representative Kelly expressed     concern    over     adding                                                                   
regulations  when  a  responsible  operator  might  meet  the                                                                   
requirements in  any case.   He asked if  there was a  way to                                                                   
avoid  such a  costly  program.   He expressed  concern  that                                                                   
adding an entirely new program  might be overly expensive for                                                                   
the state.                                                                                                                      
                                                                                                                                
Mr. Pawlowski  responded  that in creating  the fiscal  note,                                                                   
cost  had been  a concern.   He  also noted  that this  issue                                                                   
pertains to nearly  3 thousand wells in the  state of Alaska.                                                                   
He urged that this was also a  policy statement, and that the                                                                   
costs in the fiscal note were as conservative as possible.                                                                      
                                                                                                                                
Representative Kelly cited  experience  in  dealing with  the                                                                   
standards of  drinking water and  various water sources.   He                                                                   
again  expressed  concern  over having  regulations  at  this                                                                   
smaller level.  He noted that  risks existed and citizens had                                                                   
the right to pursue a civil law  suit.  He also noted that it                                                                   
might place another burden on small businesses.                                                                                 
                                                                                                                                
Co-Chair Meyer observed  that  one should  assume that  water                                                                   
for a nursing home or day care is kept clean and safe.                                                                          
                                                                                                                                
Representative  Stoltze asked  if  the RCA  office has  dealt                                                                   
with this issue.   He cited experiences with the  RCA and the                                                                   
costs involved, and wondered if  this would be detrimental to                                                                   
smaller businesses.   He explained that there  were many such                                                                   
small  businesses  in  his district,  already  burdened  with                                                                   
costs and  regulations.  He asked  how this would  help those                                                                   
businesses.                                                                                                                     
                                                                                                                                
Mr. Pawlowski stated that this  regulation affects only those                                                                   
small wells  serving less  than 25  people, which is  smaller                                                                   
than most small business, and not an actual water system.                                                                       
                                                                                                                                
Representative  Stoltze noted  that it  might affect  a small                                                                   
subdivision in the more rural  pockets of even larger cities.                                                                   
He  expressed reluctance  to have  DEC  visiting these  small                                                                   
areas.                                                                                                                          
                                                                                                                                
10:03:26 AM                                                                                                                   
                                                                                                                                
Representative Holm asked  if   there  had  been  a  case  of                                                                   
illness   that  caused   the  change,   or  rather  just   an                                                                   
examination  of   the  regulations.    Mr.   Pawlowski  noted                                                                   
discussions in the Resources Committee  of cases when illness                                                                   
had  developed,   potentially  from  these  types   of  water                                                                   
sources.  He pointed out the Public  Health funding contained                                                                   
in the fiscal note.                                                                                                             
                                                                                                                                
Co-Chair  Chenault  sought  clarification  for the  types  of                                                                   
businesses affected  by this legislation.   He  observed that                                                                   
any business  that was  not a private  home would  fall under                                                                   
this regulation.                                                                                                                
                                                                                                                                
10:05:12 AM                                                                                                                   
                                                                                                                                
Mr. Pawlowski deferred  to the director of the  Department to                                                                   
answer this question.                                                                                                           
                                                                                                                                
KRISTIN  RYAN, DIRECTOR,  DIVISION  OF ENVIRONMENTAL  HEALTH,                                                                   
DEPARTMENT   OF    ENVIRONMENTAL   CONSERVATION,    testified                                                                   
regarding  the  legislation.   She  stated that  it  required                                                                   
regulation of small public facilities,  and not water systems                                                                   
that serve private  homes, such as a subdivision,  unless one                                                                   
of those  homes was providing  a public service, such  as day                                                                   
care.  There are a variety of  public services captured under                                                                   
this legislation.   She estimated  there were 3,000  wells of                                                                   
this size that serve the public in some way.                                                                                    
                                                                                                                                
10:07:42 AM                                                                                                                   
                                                                                                                                
Ms. Ryan  noted that  two years  ago, the regulations  stated                                                                   
that if water was  from a surface water system,  it should be                                                                   
approved by an engineer, and tested  for substances annually,                                                                   
as  well as  being designed  by  a certified  engineer.   She                                                                   
acknowledged  that the  fiscal note  had been  controversial.                                                                   
However,  she   emphasized  that   the  public  should   feel                                                                   
protected  with safe  water.   She noted  this would  require                                                                   
four personnel  for adequate testing  for the  current number                                                                   
of small public wells.                                                                                                          
                                                                                                                                
10:09:34 AM                                                                                                                   
                                                                                                                                
In regard to whether there were  cases of illness, she stated                                                                   
that it was  difficult to actually prove the  reason for some                                                                   
sickness.  She stated it was indeed a risk.                                                                                     
                                                                                                                                
Co-Chair Meyer asked  how many  of  the 3,000  wells were  in                                                                   
Anchorage.   She noted that  a large percentage,  about half,                                                                   
of public wells are in Anchorage.                                                                                               
                                                                                                                                
10:10:57 AM                                                                                                                   
                                                                                                                                
Representative Holm observed that  the definition of a public                                                                   
accommodation  in  statute  reads:   "and  all  other  public                                                                   
amusement and business establishments".                                                                                         
                                                                                                                                
Ms. Ryan  interpreted that  to mean  gas stations and  office                                                                   
buildings, and  any facilities  that provide business  to the                                                                   
public and have drinking water.   She noted that the Resource                                                                   
Committee  discussed circumstances  when an individual  might                                                                   
provide services out of their home.                                                                                             
                                                                                                                                
10:12:33 AM                                                                                                                   
                                                                                                                                
Representative Holm stated  that he  did not  believe it  was                                                                   
important for  the Department  to interpret the  statute, but                                                                   
rather how the law might be misinterpreted.                                                                                     
                                                                                                                                
Ms. Ryan  acknowledged that  interpretation would  be subject                                                                   
to individual regulators.                                                                                                       
                                                                                                                                
Representative Holm expressed  that this bill might  be going                                                                   
too far  into controlling  water systems.   He observed  that                                                                   
the definition  contained lack  of clarity, and  he expressed                                                                   
reservation about making changes through regulations.                                                                           
                                                                                                                                
10:14:43 AM                                                                                                                   
                                                                                                                                
Ms. Ryan  cited an example of  how to write  regulations that                                                                   
meet the intent of the legislation.                                                                                             
                                                                                                                                
Mr. Pawlowski  acknowledged that  a similar broad  definition                                                                   
of  public accommodation  was  examined in  a bill  regarding                                                                   
pesticides  last year.    He read  from  the definition,  and                                                                   
pointed out that it only pertains  to a place that serves the                                                                   
general public.                                                                                                                 
                                                                                                                                
Representative Holm observed  that the  Second Amendment  was                                                                   
written to protect citizens from the government.                                                                                
                                                                                                                                
Co-Chair Meyer stressed  that  the regulations  should  match                                                                   
the  intent of  the bill.  He  suggested that  AS 188.300  be                                                                   
examined  to  ensure  that  "public  accommodation"  was  the                                                                   
proper reference.                                                                                                               
                                                                                                                                
10:16:37 AM                                                                                                                   
                                                                                                                                
Representative Stoltze   asked   if   this   legislation   is                                                                   
intended to supplant or to enhance  the existing regulations.                                                                   
                                                                                                                                
Ms. Ryan  responded that smaller  water systems  were usually                                                                   
regulated in  other jurisdictions  and by local  governments,                                                                   
but  she  pointed  out  that  Anchorage  currently  does  not                                                                   
regulate Class  C wells.  They  do regulate private  wells if                                                                   
someone is selling a private residence.                                                                                         
                                                                                                                                
Representative  Stoltze pointed  out that he  does not  see a                                                                   
safety  valve   that  would  allow  a  local   government  to                                                                   
substitute its regulations.  He  cited that the Department of                                                                   
Environmental  Conservation  could  be fairly  stringent  and                                                                   
place  undue   burden  on   private  individuals   and  small                                                                   
businesses.   He noted that running  a gas station in  a more                                                                   
remote  area   was  already  difficult,  and   wondered  what                                                                   
protections existed  for them.   He stated that this  kind of                                                                   
regulation  was onerous for  such business.   He opined  that                                                                   
the  definition of  public accommodations  was  too broad  in                                                                   
this case.                                                                                                                      
                                                                                                                                
Co-Chair Meyer acknowledged   that   the  definition   caused                                                                   
concern, and  wondered if  there was a  way to add  a greater                                                                   
comfort with this issue.                                                                                                        
                                                                                                                                
10:20:38 AM                                                                                                                   
                                                                                                                                
Ms.  Ryan  proposed  that  there   were  some  exemptions  in                                                                   
regulations, and that smaller  facilities other than day care                                                                   
centers  and  other  high-risk  facilities  would  have  less                                                                   
onerous regulations.                                                                                                            
                                                                                                                                
Ms. Ryan  added that  the regulations  were testing  for very                                                                   
serious elements in the water.                                                                                                  
                                                                                                                                
10:22:10 AM                                                                                                                   
                                                                                                                                
Representative Kelly observed  that the bill was sponsored by                                                                   
request,  but reiterated  his concern  over the fiscal  note,                                                                   
and adding  a level of oversight  to an area that  is already                                                                   
regulated.   He cited an  example in  his area where  a water                                                                   
system of another size was put  in, and people were unable to                                                                   
drink the  water due to  a federal regulation.    Then  a new                                                                   
level of  arsenic was decided  and the people were  told they                                                                   
could not  bathe in the  water.  He  pointed out  the current                                                                   
budgetary  problems faced  by the state,  and questioned  the                                                                   
value of adding  more regulatory activity with  a large added                                                                   
cost.  He suggested they ought  to seek ways to cut the costs                                                                   
of regulations and reduce the burden to smaller businesses.                                                                     
                                                                                                                                
10:25:17 AM                                                                                                                   
                                                                                                                                
Co-Chair Meyer  stressed that those  in a day care  center or                                                                   
senior center  ought to be able  to rely upon  water quality.                                                                   
He  noted that  a cost  was  required for  this  surety.   He                                                                   
stated the  desire to  hold the bill  in order to  re-examine                                                                   
the fiscal note and cut costs.                                                                                                  
                                                                                                                                
Ms. Ryan pointed  out that there were currently  no standards                                                                   
for the water systems in question.                                                                                              
                                                                                                                                
Representative Kelly pointed  out that  the reason  the state                                                                   
did not regulate water systems  for private homes was because                                                                   
citizens  would complain  bitterly.   He  suggested that  the                                                                   
Committee ought to  examine the cost of compliance  with this                                                                   
regulation.                                                                                                                     
                                                                                                                                
10:28:15 AM                                                                                                                   
                                                                                                                                
THOMAS  STRATTON,  EXECUTIVE  DIRECTOR,  ALASKA  RURAL  WATER                                                                   
ASSOCIATION, testified  that his association is  a non-profit                                                                   
that  provides training  and  technical  assistance to  small                                                                   
water  systems.    He expressed  thanks  for  the  desire  to                                                                   
provide safe  drinking water in  more rural areas.   He cited                                                                   
his own  experience in  building a home  and creating  a safe                                                                   
water system, and his desire to  trust the safety of water at                                                                   
a local day care center.                                                                                                        
                                                                                                                                
10:29:43 AM                                                                                                                   
                                                                                                                                
He referred  to the definition  of public accommodation,  and                                                                   
stated his belief  that the Department had done  an excellent                                                                   
job  with  language.    He  applauded   the  legislature  for                                                                   
addressing  this issue  and the  Department of  Environmental                                                                   
Conservation for working with concerns.                                                                                         
                                                                                                                                
Co-Chair Meyer asked  if  one did  become  ill from  drinking                                                                   
water  at  a public  accommodation,  whether  the  state  was                                                                   
liable for not  providing adequate regulation.   Mr. Stratton                                                                   
stated he was not able to address  liability.  Co-Chair Meyer                                                                   
presumed that  one would first approach the  private business                                                                   
and then the state.                                                                                                             
                                                                                                                                
Mr.  Stratton  noted an  example  of individuals  dying  from                                                                   
drinking from  a water  supply, and  supposed there  could be                                                                   
lawsuits in the future.                                                                                                         
                                                                                                                                
Representative   Hawker  MOVED   Amendment  1,  labeled   24-                                                                   
LS1468\A.5, Bullock, 4/7/06.                                                                                                    
                                                                                                                                
Co-Chair Meyer OBJECTED for purposes of discussion.                                                                             
                                                                                                                                
Representative Hawker  MOVED to amend Amendment  1, to change                                                                   
line  20 from  "is  used  as"  to "may  be".   There  was  NO                                                                   
OBJECTION to  the motion to  amend Amendment 1,  therefore it                                                                   
was adopted.                                                                                                                    
                                                                                                                                
REPRESENTATIVE  NORM  ROKEBERG   spoke  to  Amendment  1.  He                                                                   
related that  there are over 3,000  homes that are  served by                                                                   
various  types of  wells in his  district.   He stressed  the                                                                   
importance of  water regulation in  the state.   He explained                                                                   
that Amendment 1 asks the Department  to adopt regulations to                                                                   
protect  exposed water  aquifers.   It requires  a fee  to be                                                                   
paid  by a  property developer  who is  developing around  an                                                                   
exposed aquifer that resulted  from previous mining activity.                                                                   
The  bill is  not  intended to  be special  legislation,  but                                                                   
applicable to all areas of the state.                                                                                           
                                                                                                                                
Representative  Rokeberg gave an  example from his  district.                                                                   
He stressed that there is a complete  breakdown of regulatory                                                                   
authority because  the local municipality  is looking  to DEC                                                                   
to take responsibility and vice  versa.  Over 200 people with                                                                   
separate wells  would be subjected to the  activity revolving                                                                   
around the development.                                                                                                         
                                                                                                                                
Representative   Rokeberg  referred   to  the  amendment   to                                                                   
Amendment 1  on line 20 as  being necessary because  that has                                                                   
been the point of contention between  the DEC and the city of                                                                   
Anchorage.  He highlighted frustrations  around access issues                                                                   
and noted three years of dealing  with DEC on the matter.  He                                                                   
pointed out that  the fees will be paid by  the developer and                                                                   
should offset costs.                                                                                                            
                                                                                                                                
10:39:46 AM                                                                                                                   
                                                                                                                                
Representative  Rokeberg  warned  the committee  to  look  at                                                                   
private  fiscal notes  that result  in costs  to the  private                                                                   
sector.   He emphasized that there  is an expectation  by the                                                                   
public that  public accommodations should have  safe drinking                                                                   
water.  The  RCA only handles economic regulation,  not water                                                                   
quality issues.   He stressed that there are  times to accept                                                                   
some  of   the  costs   that  go   with  the   constitutional                                                                   
responsibility  toward  public  safety.    This  is  such  an                                                                   
exception.                                                                                                                      
                                                                                                                                
10:42:27 AM                                                                                                                   
                                                                                                                                
Representative  Hawker followed  through with  the intent  of                                                                   
Amendment  1.    He  questioned  if  "containing  an  exposed                                                                   
aquifer" were  the appropriate  words to  use.  He  suggested                                                                   
"development  on property  affected by  an exposed  aquifer".                                                                   
Representative Rokeberg related  that the exposed aquifer has                                                                   
to be a pre-existing condition.   Representative Hawker asked                                                                   
if  the  intent  is  that  it  must  be  a  development  that                                                                   
surrounds  and contains  an aquifer,  not  downstream of  the                                                                   
aquifer.   Representative  Rokeberg said  it could be  within                                                                   
100 feet  of it.   He spoke  about contaminated water  during                                                                   
the development  of the subdivisions.   Representative Hawker                                                                   
responded that the language reads  that the "development must                                                                   
contain  the  aquifer  and  must not  be  within  100  feet".                                                                   
Representative  Hawker  referred  to  line 11  and  line  14,                                                                   
"property  containing".   Representative  Rokeberg  suggested                                                                   
"adjacent  to".   Representative  Hawker suggested  "affected                                                                   
by".  Representative Rokeberg agreed.                                                                                           
                                                                                                                                
10:46:53 AM                                                                                                                   
                                                                                                                                
Representative  Kerttula spoke  of a  concern with the  words                                                                   
regarding no  improvements within 100  feet.  She  asked when                                                                   
the  construction   should  have  started.     Representative                                                                   
Rokeberg  said   it  would   be  a  pre-existing   condition.                                                                   
Representative Kerttula attempted clarification.                                                                                
                                                                                                                                
10:48:20 AM                                                                                                                   
                                                                                                                                
Representative Hawker  proposed to change lines 11  and 14 to                                                                   
read  "property within  100 feet  of an  exposed aquifer"  in                                                                   
place of "containing and".                                                                                                      
                                                                                                                                
Representative Kerttula suggested changing lines 21-23.                                                                         
                                                                                                                                
Co-Chair Meyer suggested  that the bill be set  aside to have                                                                   
the amendments re-written.                                                                                                      
                                                                                                                                
10:50:48 AM                                                                                                                   
                                                                                                                                
Representative Kelly asked about  if the area is regulated by                                                                   
Anchorage.   Representative  Rokeberg replied  that the  only                                                                   
regulation involves testing the  water.  Representative Kelly                                                                   
asked if  they could choose  to regulate it.   Representative                                                                   
Rokeberg  said   he  believes   so.    Representative   Kelly                                                                   
suggested  that   sometimes  locals  don't   want  regulation                                                                   
responsibility.  He suggested a separate bill.                                                                                  
                                                                                                                                
HB  360  was   heard  and  HELD  in  Committee   for  further                                                                   
consideration.                                                                                                                  
                                                                                                                                
10:52:13 AM                                                                                                                   
                                                                                                                                

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