Legislature(1993 - 1994)

03/30/1993 03:00 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
  Number 567                                                                   
                                                                               
  HB 237 - MARINE PILOT LICENSING AND TARIFFS                                  
                                                                               
  CHAIRMAN BILL HUDSON, PRIME SPONSOR of HB 237, read the                      
  sponsor statement.  He explained that HB 237 was introduced                  
  to fine-tune Alaska's Marine Pilot Act of 1991, and to                       
  provide a mechanism to determine pilotage tariffs, now left                  
  to the several pilot organizations by statutory provision,                   
  and scheduled to be repealed on June 30, 1994.                               
                                                                               
  CHAIRMAN HUDSON further stated that while the 1991 Act                       
  improved marine pilotage in Alaska, its implementation has                   
  revealed that many problems still need to be addressed,                      
  specifically with regard to the powers of the Board of                       
  Marine Pilots and tariff setting.  HB 237 seeks to remedy                    
  these problems by:                                                           
                                                                               
  1)  better defining the powers of the Board of Marine Pilots                 
  to make it more effective; and                                               
                                                                               
  2)  charging the APUC with the authority to set tariffs.                     
                                                                               
  Number 619                                                                   
                                                                               
  COMMISSIONER PAUL FUHS, DEPARTMENT OF COMMERCE AND ECONOMIC                  
  DEVELOPMENT, testified in support of the work put into HB
  237 and emphasized the importance of HB 237.  Commissioner                   
  Fuhs pointed out that 95 percent of Alaska's resources move                  
  over the water.                                                              
                                                                               
  COMMISSIONER FUHS stated that Alaska has four regions in the                 
  state, two of which have competing piloting organizations                    
  and two that don't.                                                          
                                                                               
  TAPE 93-28, SIDE A                                                           
  Number 001                                                                   
                                                                               
  COMMISSIONER FUHS explained that a lot of the issues the                     
  committee will deal with are safety and efficiency; some of                  
  the most contentious issues are purely money.  Commissioner                  
  Fuhs explained that the department called for a meeting last                 
  month with the various aspects of the pilotage industry and                  
  pilot groups to get people talking and air their concerns.                   
                                                                               
  Number 020                                                                   
                                                                               
  COMMISSIONER FUHS reiterated the importance of moving some                   
  of the decision making to the Alaska Public Utilities                        
  Commission (APUC) and suggested that the APUC be charged                     
  with the responsibility of setting the number of pilots                      
  allowed to operate in the state.                                             
                                                                               
  COMMISSIONER FUHS commented that he did not know of any                      
  other industry where the same words were used to mean the                    
  exact opposite, and he expressed his hope that the committee                 
  would look and listen carefully to all sides of the issues.                  
                                                                               
  Number 072                                                                   
                                                                               
  REP. WILLIAMS asked what the outcome was of the meeting Mr.                  
  Fuhs mentioned.                                                              
                                                                               
  MR. FUHS explained that they were still working on getting                   
  the parties together in some sort of agreeable fashion.                      
                                                                               
  REP. WILLIAMS stated that he was of the opinion that the                     
  people involved in the issues come together instead of                       
  looking to the legislature to solve everything.                              
                                                                               
  Number 115                                                                   
                                                                               
  CHAIRMAN HUDSON commented that he and his staff have met                     
  with all sides of every issue and have come to the                           
  conclusion that it would be impossible to please everyone on                 
  every issue.                                                                 
                                                                               
  CHAIRMAN HUDSON pointed out that his major concerns were:                    
                                                                               
       - safety of the movement of ships in Alaskan waters;                    
                                                                               
       - qualifications of the pilots;                                         
                                                                               
       _ making certain that the pilots are separated from the                 
        shipping companies, so that there can be no undue                      
         influence put on the pilots; and                                      
                                                                               
       - uniform fees for taking a ship from point A to point                  
        B.                                                                     
                                                                               
                                                                               
  COMMISSIONER FUHS added another concern that the costs of                    
  pilotage not be so high that it be a deterrent to commerce,                  
  and that the number of pilots be so great that pilots can't                  
  make a living.                                                               
                                                                               
  Number 169                                                                   
                                                                               
  DON SCHROER, CHAIRMAN, ALASKA PUBLIC UTILITIES COMMISSION                    
  (APUC), testified that the commission does not have a                        
  position on HB 237 yet.  He said a public meeting would be                   
  scheduled in the near future to develop a commission                         
  position and fiscal note for HB 237.  Mr. Schroer asked for                  
  a deferment until the commission has time to evaluate the                    
  costs involved in taking on this added responsibility.                       
                                                                               
  Number 199                                                                   
                                                                               
  CARL LUCK, DIRECTOR, DIVISION OF OCCUPATIONAL LICENSING,                     
  DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT, testified                   
  that under current law there are provisions for competition                  
  within regions as well as across regions.  He stated that                    
  there is an unlimited number of pilots; the board is                         
  balanced between the pilot industry and the public; the                      
  board sets maximum tariffs; and then the pilot organizations                 
  negotiate with industry.  He further noted that the board                    
  disciplines pilots, approves pilot organizations, sets                       
  training programs, licenses pilots, upgrades pilots, tests                   
  pilots, and creates piloting regions.  He said pilots are                    
  independent contractors, prohibited from being employees,                    
  and have to carry insurance.                                                 
                                                                               
  MR. LUCK stated that HB 237 would limit the number of                        
  pilots, and most states already do that.                                     
                                                                               
  MR. LUCK added that he hoped the following issues would be                   
  addressed by this legislature:                                               
                                                                               
       - safety on Alaskan waters;                                             
                                                                               
       - licensed pilots for cross regions;                                    
                                                                               
       - equitable tariffs set by unbiased entity; and                         
                                                                               
       - pilot dispatching.                                                    
                                                                               
  MR. LUCK  detailed some of the requirements to become a                      
  licensed pilot in this state.                                                
                                                                               
  CHAIRMAN HUDSON noted that HB 237 does not address the pilot                 
  dispatch issue.                                                              
                                                                               
  Number 601                                                                   
                                                                               
  REP. PORTER asked, If the Alaska Public Utilities Commission                 
  were to limit the number of pilots, would it pose a problem                  
  to the free movement of commerce?                                            
                                                                               
  MR. LUCK explained that the pilotage act does not make the                   
  free movement of commerce a determining factor; safety is                    
  the only concern.                                                            
                                                                               
  REP. PORTER added that setting the maximum too low would                     
  curtail movement on the waters.                                              
                                                                               
  Number 623                                                                   
                                                                               
  MR. LUCK stated that the formula used to set limits, both                    
  minimum and maximum, would have to provide for retirement,                   
  sickness, vacations, etc.  Mr. Luck further stated that he                   
  believed this could be done with a considerable amount of                    
  input and time.                                                              
                                                                               
  TAPE 93-28, SIDE B                                                           
  Number 001                                                                   
                                                                               
  CHAIRMAN HUDSON stated that he had no problem with amending                  
  the bill to include a statement regarding the free movement                  
  of trade.                                                                    
                                                                               
  MR. LUCK stated that currently the state regulates the                       
  pilots and not the industry, but he envisioned industry                      
  having to come to the table in the future with at least some                 
  quantative analysis of how this affects the bottom line.                     
                                                                               
  REP. WILLIAMS inquired about the numbers Mr. Luck cited on                   
  when and how often pilots work.                                              
                                                                               
  MR. LUCK asked that the pilots answer for themselves.                        
                                                                               
  Number 060                                                                   
  PETER LIE-NIELSEN, ALASKA COASTWISE PILOTS, testified that                   
  his group was against setting a maximum number of pilots.                    
  Mr. Lie-Nielsen also noted that there are a large number of                  
  pilots over the age of 65 that will be retiring shortly.                     
                                                                               
  MR. LIE-NIELSEN added that in 1992 not one new pilot was                     
  licensed partly due to a strict licensing procedure.  Mr.                    
  Lie-Nielsen stated that the U.S. Coast Guard relaxed its                     
  restrictions on pilotage, resulting in the Exxon Valdez                      
  disaster.                                                                    
                                                                               
  MR. LIE-NIELSEN noted that there are numerous examples of                    
  vessels in compulsory waters moving without pilots because                   
  of the nonavailability of licensed pilots.                                   
                                                                               
  Number 212                                                                   
                                                                               
  REP. SITTON inquired how much insurance and license fees                     
  were.                                                                        
                                                                               
  Number 224                                                                   
                                                                               
  MR. LIE-NIELSEN stated that the insurance runs about                         
  $3,000.00 per year and the license fees are about $1,000.00                  
  per year.                                                                    
                                                                               
  Number 230                                                                   
                                                                               
  CHAIRMAN HUDSON asked Mr. Lie-Nielsen why he believed the                    
  state would end up with too few pilots under this proposed                   
  legislation.                                                                 
                                                                               
  Number 244                                                                   
                                                                               
  MR. LIE-NIELSEN answered that vessels do move on the water                   
  without pilots illegally, and restricting the number of                      
  pilots does a disservice to the concept of safety on the                     
  water.                                                                       
                                                                               
  Number 280                                                                   
                                                                               
  CHAIRMAN HUDSON reiterated that it was his belief that a                     
  formula could be devised that would take into account the                    
  concerns mentioned above and would satisfy the needs of the                  
  industry.                                                                    
                                                                               
  Number 305                                                                   
                                                                               
  REP. WILLIAMS expressed concern with putting a cap on the                    
  number of pilots.                                                            
                                                                               
  MR. LIE-NIELSEN agreed that this was a concern and that                      
  safety should come first.                                                    
  Number 388                                                                   
                                                                               
  BERNIE SMITH, representing TESORO PETROLEUM AND ALASKA                       
  STEAMSHIPS, testified that HB 237 had some good points, but                  
  it needed more work, and he would like to see it held over                   
  the interim for further review.                                              
                                                                               
  Number 425                                                                   
                                                                               
  MICHAEL SPENCE, ALASKA COASTWISE PILOTS ASSOCIATION, read a                  
  statement on behalf of his group opposing HB 237.  Mr.                       
  Spence stated that his group was concerned about three                       
  elements of HB 237:                                                          
                                                                               
  1) fixing tariffs;                                                           
                                                                               
  2) fixing the number of pilots in a region; and                              
                                                                               
  3) forbidding cross regional pilotage.                                       
                                                                               
  Number 499                                                                   
                                                                               
  CHAIRMAN HUDSON asked Mr. Spence to be specific as to what                   
  parts of HB 237 Mr. Spence had problems with.                                
                                                                               
  Number 507                                                                   
                                                                               
  MR. SPENCE pointed out the following concerns:                               
                                                                               
       - HB 237 might create a shortage of pilots;                             
                                                                               
       - HB 237 prohibits cross region licensing;                              
                                                                               
       - giving authority to APUC would increase tariffs; and                  
                                                                               
       - HB 237 as written does not provide more safety.                       
                                                                               
  Number 569                                                                   
                                                                               
  MR. LUCK clarified the licensing fee structure as it stands                  
  now.                                                                         
                                                                               
  Number 580                                                                   
                                                                               
  REP. MACKIE asked Mr. Spence where and how in this bill                      
  would his organization be adversely affected.                                
                                                                               
  Number 593                                                                   
                                                                               
  MR. SPENCE answered that it was his group's concern that the                 
  Board of Marine Pilots has been unfair in the past and that                  
  they couldn't make a fair and accurate assessment of what's                  
  needed.                                                                      
                                                                               
  Number 610                                                                   
                                                                               
  REP. MACKIE asked that the persons limit their testimony to                  
  the legislation at hand and not air their feelings about                     
  alleged bias and "bad blood" from the past.  Rep. Mackie                     
  said he was only interested in good public policy, not the                   
  in-fighting between the groups.                                              
                                                                               
  TAPE 93-29, SIDE A                                                           
  Number 001                                                                   
                                                                               
  PHIL SWAN, SOUTHEAST ALASKA PILOTS ASSOCIATION, testified                    
  that his group supported HB 237.  Mr. Swan believed that HB
  237 would give the industry well-qualified pilots at a fair                  
  price and the state would benefit by retaining exclusive                     
  control over pilotage without any interference from                          
  industry.                                                                    
                                                                               
  Number 078                                                                   
                                                                               
  REP. PORTER asked if HB 237 was the same as what's currently                 
  law on the west coast.                                                       
                                                                               
  MR. SWAN responded that HB 237 does bring Alaska law closer                  
  to what's being done on the West Coast.                                      
                                                                               
  Number 122                                                                   
                                                                               
  REP. MACKIE asked if there was anything about HB 237 that                    
  was detrimental to Mr. Swan's group.                                         
                                                                               
  MR. SWAN answered that his group had no concerns regarding                   
  the bill.                                                                    
                                                                               
  CHAIRMAN HUDSON announced that he would hold HB 237 over and                 
  adjourned the meeting at 6:34 p.m.                                           

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