Legislature(2017 - 2018)ADAMS ROOM 519

04/04/2018 01:30 PM FINANCE

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= bill was previously heard/scheduled
Moved HB 398 Out of Committee
-- Public Testimony --
<Bill Hearing Canceled>
<Pending Referral>
-- Public Testimony --
Heard & Held
-- Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
Heard & Held
-- Public Testimony --
HOUSE BILL NO. 277                                                                                                            
     "An  Act  relating  to   the  regulation  of  broadband                                                                    
     Internet;  and  making  certain  actions  by  broadband                                                                    
     Internet service  providers unlawful acts  or practices                                                                    
     under the  Alaska Unfair  Trade Practices  and Consumer                                                                    
     Protection Act."                                                                                                           
2:47:52 PM                                                                                                                    
REPRESENTATIVE  SCOTT  KAWASAKI,   SPONSOR,  introduced  the                                                                    
bill.  He stressed  that technology  had changed  rapidly in                                                                    
the  past  ten  years.  He explained  that  since  1996  the                                                                    
internet   was  governed   under   a   system  called   "net                                                                    
neutrality". The bill required  internet providers to engage                                                                    
in the  practice of net  neutrality. He read from  a sponsor                                                                    
statement (copy on file):                                                                                                       
     HB 277 would require  Internet Service Providers (ISPs)                                                                    
     who  provide  broadband  Internet to  Alaskan  families                                                                    
     engage  in the  practice  of net  neutrality. The  bill                                                                    
     would make  sure all  data on  the Internet  is treated                                                                    
     equally.  It   would  protect  small   businesses  from                                                                    
     uncompetitive practices and guarantee  an open and free                                                                    
     internet for all users.                                                                                                    
     Without  net  neutrality,  ISPs may  legally  speed  up                                                                    
     certain  sites,  slow  down  others,  block  sites  all                                                                    
     together,  and require  certain users  to pay  more for                                                                    
     Internet fast lanes. The  elimination of net neutrality                                                                    
     gives  ISPs  the  power   to  determine  what  websites                                                                    
     consumers   could  visit   and  what   content  website                                                                    
     creators  could share.  Allowing  ISPs to  discriminate                                                                    
     based on  content undermines a  free and  open Internet                                                                    
     as well  as a  free and  open society.  Eliminating net                                                                    
     neutrality  risks Alaskans  First  Amendment rights  of                                                                    
     free  speech, free  press,  and  free association,  the                                                                    
     right to privacy, and distorts the free market.                                                                            
     On  multiple  occasions,  millions  of  Americans  have                                                                    
     publicly   commented  in   favor   of  protecting   net                                                                    
     neutrality  and  have  spoken out  against  the  recent                                                                    
     Federal  Communications Commission  order to  eliminate                                                                    
     net neutrality rules implemented  in 2015. The internet                                                                    
     is a  modern necessity for individuals  and businesses.                                                                    
     Net neutrality  is widely supported by  consumer rights                                                                    
     groups, privacy groups, and businesses organizations.                                                                      
     This  bill would  ensure that  the  Internet remains  a                                                                    
     platform  for  unrestricted  economic  competition  and                                                                    
     free   communication.  I   respectfully  request   your                                                                    
     support for HB 277.                                                                                                        
Representative  Kawasaki  shared  that  net  neutrality  was                                                                    
supported by  millions of people  in the United  States (US)                                                                    
and worldwide.  He indicated that  it was also  a bipartisan                                                                    
issue; 88 percent of Democrats,  71 percent of Independents,                                                                    
and 67  percent of Republicans supported  net neutrality. He                                                                    
believed that net neutrality should  be protected. He listed                                                                    
the support  of various  national groups from  the political                                                                    
spectrum that  supported net  neutrality and  maintaining an                                                                    
open and free internet.                                                                                                         
2:52:11 PM                                                                                                                    
Representative Wilson  needed more  detail on the  bill. She                                                                    
wondered   about   the   definition   of   net   neutrality.                                                                    
Representative  Kawasaki characterized  the  internet as  an                                                                    
information highway  and guaranteed the essential  idea that                                                                    
everybody had the same access  as everybody else - no matter                                                                    
what   car  one   drove.   Large   corporations  and   small                                                                    
independent  businesses  had  access to  the  same  internet                                                                    
speed,   accessibility,   and   rates  as   everyone   else.                                                                    
Representative Wilson  spoke about computer  games requiring                                                                    
high  speed  internet  and  other  users  that  only  viewed                                                                    
documents; she wondered whether  both types of accessibility                                                                    
would be charged the same amount of money.                                                                                      
JACOB   GERRISH,  STAFF,   REPRESENTATIVE  SCOTT   KAWASAKI,                                                                    
answered in the  affirmative and furthered that  it was more                                                                    
complicated. He  provided a scenario of  a broadband company                                                                    
who  owned a  video game  company and  could prioritize  the                                                                    
internet for their video games;  it was about specific sites                                                                    
and not only different types of services.                                                                                       
Mr. Gerrish reviewed the sectional analysis (copy on file):                                                                     
     Section 1:  Adds a new  Internet neutrality  section to                                                                    
     AS 42.05,  The Alaska  Public Utilities  Regulatory Act                                                                    
    that requires Internet Service Providers (ISPs) to:                                                                         
     ? Disclose  network management  practices, performance,                                                                    
     and  commercial  terms  so   that  consumers  can  make                                                                    
     informed decisions                                                                                                         
     ?  Not block,  impair,  prioritize,  or interfere  with                                                                    
     Internet access, website content, or Internet traffic                                                                      
     Provides  for  an  exception   to  the  restriction  on                                                                    
     prioritization if  the Regulatory Commission  of Alaska                                                                    
     finds  that such  an action  would  benefit the  public                                                                    
     Section  2: AS  45.50.471, adds  violation of  Internet                                                                    
     neutrality to  the list of unlawful  acts and practices                                                                    
     in  the  Alaska  Unfair Trade  Practices  and  Consumer                                                                    
     Protection Act                                                                                                             
     Section 1: Applicability  section for contracts entered                                                                    
     after the effective date of  this bill. HB 277 does not                                                                    
     apply to  contracts entered between ISPs  and consumers                                                                    
     before that date.                                                                                                          
2:55:35 PM                                                                                                                    
Co-Chair Seaton  understood that consumers had  the right to                                                                    
buy a particular  internet speed, which was  not impacted by                                                                    
the bill.  The bill would  safeguard that an  individual who                                                                    
purchased an  internet speed  of 10  GB (gigabyte)  would be                                                                    
the same speed  for every website the  individual viewed. It                                                                    
would  not be  throttled down  for a  specific game  site or                                                                    
advertiser. He  surmised the bill prevented  the provider of                                                                    
internet service  from changing  the speeds of  the products                                                                    
that could  be received. He  asked whether he  was generally                                                                    
correct.  Mr. Gerrish  replied that  the  remarks were  very                                                                    
close to accurate.  He used the example  of the Trans-Alaska                                                                    
Pipeline System (TAPS) where a  large corporation or a small                                                                    
oil  producer  had  the  same  access,  which  encouraged  a                                                                    
smaller company to possibly become  a larger company via the                                                                    
access.  Co-Chair Seaton  hypothesized  that net  neutrality                                                                    
was comparable to  all the producer's oil  travelling in the                                                                    
pipe  at the  same speed  versus Alyeska  choosing preferred                                                                    
providers oil that would travel  to Valdez faster than other                                                                    
companies  oil. He  asked whether  the example  was correct.                                                                    
Mr. Gerrish replied in the affirmative.                                                                                         
2:58:50 PM                                                                                                                    
Co-Chair Foster OPENED public testimony.                                                                                        
MIKE  ROBINSON, ALASKA  LIBRARY ASSOCIATION,  ANCHORAGE (via                                                                    
teleconference),  spoke in  support  of  net neutrality.  He                                                                    
elaborated  that  libraries  supported  net  neutrality  for                                                                    
equitable  access  and  intellectual  freedom  reasons.  The                                                                    
library was often the gateway  to the internet for community                                                                    
members.  Libraries offered  access to  subscription content                                                                    
services   such  as   e-books,   newspapers,  and   academic                                                                    
journals. The  ability of internet providers  to offer "fast                                                                    
lane" service for content providers  who were willing to pay                                                                    
a premium  price undermined the equitable  access principle.                                                                    
He acknowledged  that some believed that  market competition                                                                    
would  ensure equitable  access  and  commented that  market                                                                    
competition for  broadband did not  exist in many  places in                                                                    
Alaska.   He   believed   that   net   neutrality   promoted                                                                    
intellectual  freedom  by  providing  equal  access  to  all                                                                    
speech regardless of  type or origin. He  wanted to prohibit                                                                    
broadband  companies  from  the ability  to  make  decisions                                                                    
regarding what  content was promoted  or limited  and remain                                                                    
gateways and not gatekeepers.                                                                                                   
3:01:22 PM                                                                                                                    
MARY JO  TORGESON, ANCHORAGE PUBLIC LIBRARY,  ANCHORAGE (via                                                                    
teleconference),  testified  in  support of  the  bill.  She                                                                    
informed committee members that  libraries provided free and                                                                    
open access  to information and net  neutrality allowed that                                                                    
to  happen.  She cautioned  that  without  the bill  utility                                                                    
companies  would   choose  to   limit  access   even  though                                                                    
providers  would promise  to abide  by  net neutrality.  She                                                                    
appreciated  the proactive  approach to  protecting internet                                                                    
access  via the  legislation. She  voiced that  the internet                                                                    
was one  of the primary  ways information was  delivered and                                                                    
it  was  vital that  providers  were  not able  to  control,                                                                    
limit, or manipulate the  content. Libraries offered freedom                                                                    
of access and she supported the legislation.                                                                                    
Representative Wilson  asked if there  had been a  change in                                                                    
the internet at the  library since the Federal Communication                                                                    
Commission  (FCC)  change.  Ms. Torgeson  replied  that  the                                                                    
ruling took  place later in  April. She provided  an example                                                                    
related to a  grocery store endcap shelf space  offered at a                                                                    
greater price to  describe the impact if  net neutrality was                                                                    
lost. She  related that she  had not experienced  any change                                                                    
in  internet service  and remembered  that  GCI promised  to                                                                    
protect net  neutrality. She  commented that  protecting net                                                                    
neutrality should be up to the government, not a provider.                                                                      
3:04:36 PM                                                                                                                    
EVELYN   TREFON,   SELF,  NEWHALEN   (via   teleconference),                                                                    
testified  in   favor  of  the   bill.  She   believed  that                                                                    
maintaining   net neutrality  in Alaska  was of  the "utmost                                                                    
importance."  She  worried what  would  happen  to her  home                                                                    
internet  if  GCI decided  to  abandon  net neutrality.  She                                                                    
shared  that she  currently  paid $220  per  month for  only                                                                    
60gb.  She believed  internet should  be  available for  all                                                                    
Alaskans at reasonable rates and speeds.                                                                                        
3:05:43 PM                                                                                                                    
MARTIN STEPETIN,  SELF, JUNEAU, testified in  support of the                                                                    
legislation.  He believed  that  net neutrality  was at  the                                                                    
forefront of the  first amendment and free  speech. He noted                                                                    
that   GCI  was   owned  by   a   much  larger   non-Alaskan                                                                    
corporation;  Liberty Interactive.  He  shared  that he  had                                                                    
written  to  Senators Lisa  Murkowski  and  Dan Sullivan  in                                                                    
opposition  to  the FCC  ruling  and  congresses actions  to                                                                    
repeal net  neutrality laws.  He voiced  that the  state was                                                                    
currently not  protected by any  federal laws  governing net                                                                    
neutrality and  believed the state  must act to  protect its                                                                    
broadband.  He believed  that  history demonstrated  service                                                                    
providers would "violate  basic laws when left  to their own                                                                    
devices".  He relayed  that AT&T  blocked iPhone  users from                                                                    
using SKYPE in  2007 and in 2005 a  Canadian company blocked                                                                    
users trying  to organize a  labor strike. He  could provide                                                                    
many other examples. He emphasized  that the state must take                                                                    
measures   to  protect   its   citizens   from  losing   net                                                                    
3:09:04 PM                                                                                                                    
LEON JAIMES, SELF, ANCHORAGE  (via teleconference), spoke in                                                                    
support  of  the bill.  He  had  worked in  the  information                                                                    
technology field for  20 years and worked  as an information                                                                    
security  consultant. He  believed net  neutrality protected                                                                    
businesses in  the state from  the "pay to  play" practices.                                                                    
He believed  that without  net neutrality,  regulation, free                                                                    
speech, and  privacy were  at risk.  He elucidated  that net                                                                    
neutrality  played a  vital role  in  ensuring that  service                                                                    
providers did  not engage in  collecting large sets  of data                                                                    
that  lead  to individual's  personal  data.  He pointed  to                                                                    
recent  abuse of  user privacy  by  Cambridge Analytica  and                                                                    
Facebook and did  not want internet providers  to access the                                                                    
same  information.   He  expressed  concern  about   how  an                                                                    
individual's data  content would be catalogued  and recorded                                                                    
in order to  be billed under the ruling. He  relayed that it                                                                    
was challenging  for business to protect  the information it                                                                    
collected, and the  ruling would make it  more difficult. He                                                                    
supported implementing net neutrality in Alaska.                                                                                
Co-Chair Foster CLOSED public testimony.                                                                                        
3:11:55 PM                                                                                                                    
Co-Chair  Foster  noted  there   were  two  members  of  the                                                                    
Regulatory Commission  of Alaska  (RCA) online. He  asked if                                                                    
they had comments.                                                                                                              
DAVID  PARRISH,  COMMON  CARRIER SPECIALIST  IV,  REGULATORY                                                                    
COMMISSION   OF  ALASKA   (via   teleconference),  did   not                                                                    
currently  have remarks.  The commission  did  not yet  know                                                                    
what would be required of  them to implement net neutrality.                                                                    
He  stated that  the RCA  was uncertain  whether they  would                                                                    
have any  jurisdiction in the  matter considering  the FCC's                                                                    
recent ruling.                                                                                                                  
Representative  Guttenberg stated  that  the  FCC had  taken                                                                    
some of the authority away  from the states. He asked, "what                                                                    
authority the  state had  to control  what the  state does."                                                                    
Mr. Parrish  answered that  New York  and Montana  had taken                                                                    
executive  action to  ensure that  any state  contracts with                                                                    
broadband service  providers would  have to comply  with net                                                                    
neutrality  provisions. He  thought  that  states could  use                                                                    
right-of-way permissions  in the same manner.  He determined                                                                    
that  there were  other avenues  the state  could take  that                                                                    
would not "implicate" federal preemption.                                                                                       
3:15:10 PM                                                                                                                    
Representative Kawasaki  stated the bill  would specifically                                                                    
prohibit  decreasing, blocking,  or interfering  in internet                                                                    
service. He reported  that subsection (c) of  the bill dealt                                                                    
specifically   with  the   RCA   regarding  telehealth   and                                                                    
telemedicine  what would  benefit  the  public interest.  He                                                                    
asked  for the  RCA's interpretation.  Mr. Parrish  believed                                                                    
Representative  Kawasaki was  referencing to  subsection (c)                                                                    
and the language " The  commission may waive the prohibition                                                                    
in  (b)(3).   He  guessed that  it applied  to the  types of                                                                    
services that had a public  service aspect if a carrier felt                                                                    
that they  had to  affect other users  access to  enable the                                                                    
public service; it would allow  carriers to make appropriate                                                                    
network management decisions. The  commission would have the                                                                    
ability to waive  prohibitions in the act when  it was found                                                                    
in  the  public's  interest. Representative  Kawasaki  asked                                                                    
whether the  commission viewed services relating  to health,                                                                    
education, and  public safety in the  public interest versus                                                                    
kids playing games on the  internet. Mr. Parrish answered in                                                                    
the affirmative. He elaborated  that it would allow carriers                                                                    
to  make   the  decisions   without  running  foul   of  the                                                                    
prohibitions on the bill.                                                                                                       
3:18:09 PM                                                                                                                    
Representative Wilson  asked what complaints  the commission                                                                    
had that would fall under  net neutrality. Mr. Parrish asked                                                                    
for  clarification.  Representative  Wilson  referenced  the                                                                    
fiscal  note analysis  on  page 2  that  mentioned over  450                                                                    
consumer complaints per  year with the bill adding  up to 85                                                                    
more. She asked what type of complaints were received.                                                                          
JONATHAN  CLEMENT, ATTORNEY,  CIVIL DIVISION,  DEPARTMENT OF                                                                    
LAW (via  teleconference), replied  that the  department had                                                                    
not  tried to  decide on  the  type of  complaints they  may                                                                    
receive  regarding net  neutrality.  There was  anticipation                                                                    
that  additional  complaints  may   come  in  due  to  media                                                                    
coverage of the  bill and noted that the number  was a rough                                                                    
Co-Chair Foster  set an amendment  deadline of 5:00  p.m. on                                                                    
HB  277  was  HEARD  and   HELD  in  committee  for  further                                                                    
Co-Chair  Foster reviewed  the  schedule  for the  following                                                                    

Document Name Date/Time Subjects
HB 277 Opposition letter .pdf HFIN 4/4/2018 1:30:00 PM
HB 277
HB 277 ATT Opposition 4.2.18.pdf HFIN 4/4/2018 1:30:00 PM
HB 277
HB 398 Additional Documents - 2015 Indirect Expenditure Report-Public Utility Exemption.pdf HFIN 4/4/2018 1:30:00 PM
HB 398
HB 398 Sponsor Statement 4.3.18.pdf HFIN 4/4/2018 1:30:00 PM
HB 398
HB 398 Additional Documents - Legisative Legal Opinion.pdf HFIN 4/4/2018 1:30:00 PM
HB 398
HB 398 Sectional Analysis v.D 4.3.18.pdf HFIN 4/4/2018 1:30:00 PM
HB 398
HB 398 Additional Documents - Dept. of Revenue Letter of Explaination 4.3.18.pdf HFIN 4/4/2018 1:30:00 PM
HB 398
HB 277 Letters of Support.pdf HFIN 4/4/2018 1:30:00 PM
HB 277
HB277 Letter of Opposition - House Finance.pdf HFIN 4/4/2018 1:30:00 PM
HB 277