Legislature(2017 - 2018)GRUENBERG 120
02/23/2017 01:00 PM House MILITARY & VETERANS' AFFAIRS
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| Audio | Topic |
|---|---|
| Start | |
| HB126 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | HB 126 | TELECONFERENCED | |
HB 126-ORGANIZED MILITIA: WORKERS COMPENSATION
1:06:24 PM
CHAIR TUCK announced that the only order of business would be
HOUSE BILL NO. 126, "An Act relating to workers' compensation
benefits for members of the organized militia."
CHAIR TUCK stated that HB 126 would extend workers' compensation
benefits to organized [militia members] while participating in
training exercises. Current statute already provides workers'
compensation benefits to members of the organized militia when
called into active service; HB 126 would extend the benefits to
training.
1:07:34 PM
REPRESENTATIVE RAUSCHER asked what the workers' compensation
coverage would cost the state both before and after an injury.
1:08:33 PM
MARIE MARX, Director, Division of Workers Compensation,
Department of Labor & Workforce Development (DLWD), answered
that the remedy for an injury without workers' compensation, is
through litigation. She remarked:
Workers' compensation is an insurance program that
provides prompt, efficient, limited benefits to an
employee, and in exchange for providing those
benefits, the injured worker gives up their right to
sue and gives up their right to pursue pain and
suffering and punitive damages and so forth. So it's
a limited benefit system, and they call it the great
compromise, 'cause that's what it really is - it's a
compromise that really resulted from the industrial
... revolution when there were severe injuries and
resulting lawsuits that put employers out of business.
So before workers' [compensation] is in place, it
would be the tort remedy and whatever damages are
pursued through that.
MS. MARX explained that under HB 126, a worker whose injury
falls within the coverage could receive medical costs, indemnity
benefits, death benefits, and reemployment benefits. The
indemnity or wage loss would be calculated based on the workers'
gross weekly earnings, and would be capped at $1,239 per week.
REPRESENTATIVE RAUSCHER offered his understanding that under HB
126, there is no cost to state unless a covered worker gets
hurt; the costs of the injury could result in a slight rise in
premiums across the many state employees.
MS. MARX responded that the State of Alaska as the employer
would not incur additional premiums: Any benefits paid would be
the costs. She expressed that there is no way to know what
costs or benefits will be paid in any future case.
1:11:21 PM
REPRESENTATIVE SADDLER drew attention to the zero fiscal notes
provided by the Department of Administration, Department of
Labor, and Department of Military & Veterans' Affairs. He
offered his understanding that a zero fiscal note is provided as
confirmation that the legislation would have no financial
impact, but this piece of legislation has an uncertain financial
impact. He opined that based on previous testimony which
identified that the costs are unknown, an indeterminate fiscal
note would be more appropriate. He requested a new fiscal note
to reflect the uncertainty of costs.
Ms. MARX responded that the Division of Workers' Compensation
would not incur any additional costs to administer the coverage
under HB 126.
REPRESENTATIVE SADDLER remarked, "If this is free, great, let's
cover everybody all the time, if it's free ... but I suspect it
is not."
MS. MARX deferred the question to the Division of Risk
Management.
1:13:06 PM
REPRESENTATIVE SADDLER noted that there is value in providing
workers' compensation to the organized militia members, and the
fiscal notes should reflect the certainty of the costs. He
remarked, "If we don't know what that cost will be, I think that
deserves an indeterminate fiscal note."
SCOTT JORDAN, Director, Division of Risk Management, Department
of Administration, responded that Representative Saddler's
comments are not incorrect. He explained that the Division of
Risk Management can calculate the salaries and projected costs
of most state employees and can generate a rate; however, the
division does not have accurate data on members of the organized
militia and is unable to generate a rate. He agreed that if
there was a claim, then there would be a premium for that agency
for that claim, but it can't be calculated beforehand.
REPRESENTATIVE SADDLER expressed that if there is no way to
calculate [the costs], then the fiscal impact is indeterminate.
He mentioned that militia members would be in circumstances with
a higher chance of injury than most state workers. He drew
attention to page 1, lines 5-9, of HB 126, which read as
follows:
(a) A member of the organized militia who has been
ordered into active state service by the governor
under AS 26.05.070 or ordered into training under AS
26.05.100, and who suffers an injury or disability in
the line of duty, is an employee of the state for
purposes of this chapter.
MR. JORDAN noted that HB 126 would add coverage during training
and organized militia members are already covered while on
active duty.
1:15:38 PM
CHAIR TUCK asked whether a rate was previously determined for
the coverage of members of the organized militia during active
duty. He asked if any injuries have increased workers'
compensation payments.
MR. JORDAN answered that organized militia members have been on
the books for so long that he is unsure whether rates were
calculated before he started working with the department in
1998. He offered his understanding that similar groups of
people covered by workers' compensation were taken into account
when the division started generating premiums. He proposed that
workers' compensation costs were likely considered as a whole,
not individually. He remarked, "There's no way for us to
individually count these people because they're not reported on
the [full-time equivalents] (FTEs)."
CHAIR TUCK offered his understanding that members of the
organized militia are considered part of the collective and the
costs would be absorbed by the collective. He asked how soon
the state would see an increase in workers' compensation rates
based on the proposed provision.
MR. JORDAN responded that Chair Tuck is correct that members are
calculated as a whole. He explained that if a claim were filed
and concluded in fiscal year 2017 (FY 17), then the claim would
be on the FY 18 premiums amortized over five years.
REPRESENTATIVE SADDLER said that he tries to be weary of "little
foxes that spoil the vineyards." He noted that the House
Special Committee on Military and Veterans' Affairs can make
policy decisions, but the costs might need to go to the House
Finance Committee.
1:18:38 PM
REPRESENTATIVE SADDLER moved to attach an indeterminate fiscal
note to HB 126. [The motion was subsequently referred to as
Amendment 1.]
1:18:53 PM
REPRESENTATIVE LEDOUX objected to the motion. She stated that
departments, not committees, decide a bill's fiscal note.
1:19:26 PM
CHAIR TUCK offered his understanding that fiscal notes have been
changed in committee through dialogue.
REPRESENTATIVE LEDOUX responded that her attempt last year to
"zero out" a fiscal note was overruled by the Speaker [of the
House].
CHAIR TUCK pointed out that neither the future premiums for
workers' compensation coverage nor the costs of litigation and
medical expenses without workers' compensation coverage can be
accurately predicted, but it is clear that the costs without
coverage would be much more than the premiums. He mentioned an
example where one person's claim was larger than the entire
annual budget for the [Alaska State Defense Force]. He asked,
"Do we really want to put ourselves at that type of risk ...,
and what is the cost of that risk?"
1:21:13 PM
REPRESENTATIVE SADDLER identified that the fiscal notes are all
the initial versions and have not been updated. He stated that
a potential amendment could add death and disability benefits,
and the costs would need to be re-evaluated if the amendment is
adopted.
1:21:59 PM
REPRESENTATIVE PARISH stated his opposition to changing the
fiscal notes, because they were prepared by professionals and
because all envisioned scenarios show that the state's exposure
would be lower with workers' compensation coverage.
CHAIR TUCK announced that the forthcoming vote would only be for
members in the room.
1:23:10 PM
A roll call vote was taken. Representatives Saddler and
Reinbold voted in favor of the motion to attach an indeterminate
fiscal note to HB 126 [subsequently referred to as Amendment 1].
Representatives Spohnholz, LeDoux, Rauscher, and Tuck voted
against it. Therefore, the motion failed by a vote of 2-4.
1:23:55 PM
REPRESENTATIVE SADDLER asked if Alaska State Defense Force
(ASDF) members and [Alaska] National Guard members are currently
covered while on active duty.
MR. JORDAN answered that both are covered as state employees and
would receive the same benefits as state employees, including
workers' compensation.
REPRESENTATIVE SADDLER asked, "The [Alaska] National Guard ...
when [members] are undergoing training, are they currently
covered by workers' compensation as state employees?"
MR. JORDAN offered his understanding that they are not covered.
REPRESENTATIVE SADDLER asked if ASDF volunteers are covered
during training.
MR. JORDAN answered that they are not covered.
REPRESENTATIVE SADDLER asked if death benefits would be given if
an Alaska National Guard member died during active service.
MR. JORDAN answered yes. If members were activated by the
governor, then they have benefits as state employees; if members
were activated by the federal government, then they would be
covered by the federal government.
REPRESENTATIVE SADDLER asked if there is death coverage for ASDF
members while in active duty or training.
MR. JORDAN responded that members currently have death benefits
if activated by the governor but do not have death benefits for
training missions.
1:26:28 PM
CHAIR TUCK moved to adopt Amendment 2, labeled 30-LS0357\D.1,
Wallace, 2/22/17, which read as follows:
Page 1, line 8:
Delete "or disability:
Insert ", disability, or death"
1:26:58 PM
REPRESENTATIVE SADDLER objected for the purpose of discussion.
CHAIR TUCK explained that Amendment 2 would add death benefits
to the coverage for members of the organized militia during
training.
1:27:17 PM
MS. MARX said that language in Amendment 2 mirrors language in
military code.
1:27:36 PM
REPRESENTATIVE REINBOLD asked if the reason for a zero fiscal
note is because there is no anticipation of a death.
MS. MARX offered her understanding that Representative
Reinbold's question pertains to the fiscal note from the
Division of Risk Management which would pay the benefits; the
Division of Workers' Compensation would administer benefits and
would not have any increased operational costs under HB 126.
1:28:08 PM
MR. JORDAN stated that there is no anticipation of death [during
training], although it is possible. He noted that ASDF training
missions have only had one injury, so it is difficult to
calculate possible costs. He explained that workers'
compensation costs go up and down by millions of dollars each
year, but the premiums stay fairly consistent as the risk is
spread among all the departments. He commented that a death
would be tragic and although it would be expensive, the costs
would be spread out. He stated that DMVA would not incur such
costs on its own.
REPRESENTATIVE REINBOLD asked if [Amendment 2] would result in
any financial increase to the state. She commented that
government is continuing to grow with unintended costs; she
mentioned that although there have been massive investments, the
state still has poor statistics.
1:30:09 PM
MS. MARX pointed out that workplace fatalities are rare and have
been decreasing; there were 17 work-related deaths statewide
last year. Although the number is lower than previous years,
she stated her hope that the state gets to zero work-related
deaths.
REPRESENTATIVE REINBOLD asked if the number includes both the
public and private sectors.
MS. MARX answered that it includes all work-related deaths
suffered by public or private employees in Alaska. She stated
that she does not have the breakdown but would obtain the
information.
1:31:16 PM
CHAIR TUCK explained that Amendment 2 would change only section
1 of HB 126 in order to conform to other statutory language.
1:31:51 PM
CHAIR TUCK asked Representative Saddler if he maintained his
objection to Amendment 2.
REPRESENTATIVE SADDLER answered yes and he indicated he would
like a roll call vote.
1:32:10 PM
REPRESENTATIVE PARISH spoke in support of Amendment 2 to make
statutory language consistent.
1:32:28 PM
A roll call vote was taken. Representatives Rauscher, Saddler,
Reinbold, Spohnholz, LeDoux, and Tuck voted in favor of
Amendment 2. Therefore, Amendment 2 was adopted by a vote of 6-
0.
1:33:03 PM
REPRESENTATIVE SADDLER asked for clarification regarding
Amendment 1.
CHAIR TUCK explained that he had treated Representative
Saddler's previous motion for an indeterminate fiscal note as
being Amendment 1.
1:33:22 PM
REPRESENTATIVE SADDLER said that HB 126 would "plug a potential
hole." He asked that the impacts of HB 126 would be and the
risks it would address.
1:33:50 PM
MR. JORDAN answered that up to 76 ASDF members doing training
missions would be covered for an additional 24 to 28 days per
year.
REPRESENTATIVE SADDLER characterized that the coverage is quite
small compared to the full scope of the State of Alaska
workforce.
MR. JORDAN agreed.
1:34:58 PM
REPRESENTATIVE SPOHNHOLZ said that the volunteers who sign up to
actively volunteer with ASDF are doing the state a great
service. She expressed that insuring ASDF members while they
prepare for an emergency offers members the security needed if
something happened that might jeopardize their livelihood and
would give members confidence that their service would not
jeopardize their families. She reported that in Alaska,
homelessness and bankruptcies are often caused by healthcare
crises that put people in financial desperation. She conveyed
that HB 126 a way to ensure that those serving Alaska through
the ASDF wouldn't have to face that risk.
1:36:44 PM
REPRESENTATIVE RAUSCHER offered his support of the bill although
he noted that there might be future costs involved.
1:37:27 PM
REPRESENTATIVE REINBOLD stated that it is important to have the
volunteer defense force covered in an emergency. She remarked:
However, I'm going to say that this is an inconsistent
message. We just had Department of Military &
Veterans' Affairs [Finance] Subcommittee closeout and
the only cut that we made was a small token of money
to help empower our rural communities to prepare for
natural or manmade disaster. And ... I think that was
a terrible mistake in our [House] Military and
Veterans' Affairs [Finance Subcommittee] and I would
just ask you, Mr. Chairman, to please reconsider what
happened there. But with that I'm definitely going to
be supporting this.
1:38:21 PM
CHAIR TUCK responded that he is not the chair of the
aforementioned subcommittee: The action has been taken and any
future amendments can be brought forward to the House Finance
Standing Committee. He stated that it is an unfortunate cut to
a program, but that cut is unrelated to the proposed
legislation.
1:39:06 PM
REPRESENTATIVE SADDLER, upon remarking that HB 126 is good and
covers unlikely but potentially bad risk, moved that HB 126 be
sponsored by the committee.
CHAIR TUCK clarified that HB 126 was already a committee bill.
REPRESENTATIVE LEDOUX noted that the committee, [by a vote of
4:2 during its organizational discussion on 1/26/17], had
granted the chair permission to draft any bill on behalf of the
committee.
CHAIR TUCK said he would entertain a motion to object to the
committee sponsorship of HB 126. [The previous motion by
Representative Saddler for committee sponsorship of HB 126 was
treated as withdrawn.]
REPRESENTATIVE SADDLER moved to express his opposition to HB 126
being sponsored by the committee. He added, "I was trying to
express support for the bill, but I'm being maneuvered into
saying, 'No.' But okay, that's the motion required, then ...
that's my motion."
CHAIR TUCK asked Representative Saddler to restate the motion.
REPRESENTATIVE SADDLER said, "I move that the House Special
Committee on Military and Veterans' Affairs not adopt HB 126 as
a committee bill."
REPRESENTATIVE LEDOUX objected to the motion. She expressed
that since there had already been a vote on the matter, the
appropriate [action] would be to move to rescind [the committee
sponsorship].
REPRESENTATIVE SADDLER explained that he simply had been trying
to express the committee's explicit approval of HB 126 as
opposed to the universal [approval related to committee
sponsorship of legislation]. He said, "So, for the good of the
bill and for the process of the committee, I withdraw my
motions."
1:42:34 PM
CHAIR TUCK commented that the majority of the committee's
questions pertain to the costs associated with HB 126. He
stated that without insurance, the department has a high risk:
one injury cost the department its entire budget [for ASDF]. He
noted that HB 126 would not cost the state any additional money
and would eliminate future financial risks to the state.
1:43:59 PM
REPRESENTATIVE LEDOUX moved to report HB 126, as amended, out of
committee with individual recommendations and the accompanying
fiscal notes. There being no objection, CSHB 126(MLV) was moved
out of the House Military and Veterans' Affairs Special
Committee.
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