Legislature(1993 - 1994)

04/03/1993 08:00 AM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
  HB 192:  ADVERTISING BY UNREGISTERED CONTRACTORS                             
                                                                               
  Number 319                                                                   
                                                                               
  CHAIRMAN VEZEY called the committee back to order at 8:54                    
  a.m., read the title to SSHB 192, and called for its                         
  sponsor's statement.                                                         
                                                                               
  Number 325                                                                   
                                                                               
  REPRESENTATIVE ELDON MULDER, PRIME SPONSOR OF SSHB 192,                      
  stated past regulations prevented unregistered contractors                   
  from advertising their services unless they were certified                   
  tradesmen, but a subsequent court ruling struck those                        
  regulations down.   He stated further that HB 192 would put                  
  the former regulations into statute, which would protect                     
  consumers from unscrupulous contractors.  He advised SSHB
  192 also tightens the "handyman" provisions in the                           
  regulation, which he said accounts for 50% of all unlicensed                 
  contractors' violations.                                                     
                                                                               
  REPRESENTATIVE MULDER explained the latest version also was                  
  amended to exclude publications from penalties because of                    
  periodicals like USA Today and the Wall Street Journal that                  
  are brought in from outside.                                                 
                                                                               
  Number 417                                                                   
                                                                               
  REPRESENTATIVE ULMER perceived the law would be                              
  unenforceable without the advertising restrictions.                          
                                                                               
  Number 440                                                                   
                                                                               
  CHAIRMAN VEZEY declared it did not matter if the state could                 
  penalize publishers, because the industry would police                       
  itself.  He felt it would be in the best interest of                         
  licensed contractors to clean up the business, and that they                 
  would.  He pointed out the latest version of SSHB 192 raised                 
  the maximum fine for violations from $1,000 to $10,000.                      
                                                                               
  Number 464                                                                   
                                                                               
  REPRESENTATIVE ULMER stated the industry might police itself                 
  better if the person turning in a violator was given part of                 
  the fine amount.                                                             
                                                                               
  Number 470                                                                   
                                                                               
  CHAIRMAN VEZEY was not adverse to that idea, but would not                   
  suggest it himself.                                                          
                                                                               
  Number 473                                                                   
                                                                               
  VICE CHAIRMAN PETE KOTT expressed concern about the $10,000                  
  maximum fines, saying similar violations usually carried an                  
  average fine of $300.  He was concerned such a high fine                     
  would constitute criminality and lead to full jury trials.                   
                                                                               
  Number 485                                                                   
                                                                               
  CHAIRMAN VEZEY pointed out it is standard procedure in most                  
  commercial law cases to impose large fines, often in the                     
  $10,000 range, and felt the state would be able to do so                     
  under HB 192.                                                                
                                                                               
  Number 503                                                                   
                                                                               
  REPRESENTATIVE GARY DAVIS had concerns about HB 192, but                     
  supported the larger fine.                                                   
                                                                               
  Number 505                                                                   
                                                                               
  CHAIRMAN VEZEY said the $10,000 level ought to be the                        
  minimum.                                                                     
                                                                               
  Number 510                                                                   
                                                                               
  REPRESENTATIVE OLBERG MOVED ADOPTION of CSHB 192 (STA).                      
  There was no objection, and CSHB 192 (STA) WAS ADOPTED.                      
                                                                               
  Number 519                                                                   
                                                                               
  KARL LUCK, DIRECTOR, DIVISION OF OCCUPATIONAL LICENSING,                     
  DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT (DCED), said                 
  the DCED supported HB 192, but noted the need for several                    
  changes.  He suggested changing Section one to include the                   
  possibility of municipal licenses being issued, and                          
  tightening the use of advertising in the yellow pages, since                 
  there was an exemption for directories in the latest                         
  version.                                                                     
                                                                               
  Number 570                                                                   
                                                                               
  CHAIRMAN VEZEY had no problem with deleting lines five and                   
  six of section one.                                                          
                                                                               
  Number 587                                                                   
                                                                               
  REPRESENTATIVE OLBERG agreed with the deletion.  He could                    
  envision the Yellow Pages with several listings after the                    
  exemption was given.                                                         
                                                                               
  Number 592                                                                   
                                                                               
  REPRESENTATIVE G. DAVIS concurred, saying the Yellow Pages                   
  would be a key area for small contractors to draw business                   
  from.                                                                        
                                                                               
  Number 600                                                                   
                                                                               
  MR. LUCK also had concerns about the maximum fine amount,                    
  saying an opinion from state attorneys said any fine above                   
  the $3,000 amount might be determined as criminal instead of                 
  a misdemeanor.                                                               
                                                                               
  Number 620                                                                   
                                                                               
  CHAIRMAN VEZEY felt the legislature is moving toward stiffer                 
  penalties and incarceration standards of this magnitude, and                 
  the maximum fine is within the guidelines of that                            
  philosophy.                                                                  
                                                                               
  Number 630                                                                   
                                                                               
  REPRESENTATIVE ULMER agreed with the Chairman, but asked for                 
  either a court opinion or an Attorney General's opinion to                   
  backup Mr. Luck's statements.                                                
                                                                               
  Number 640                                                                   
                                                                               
  MR. LUCK stated there was no written opinion, but rather                     
  verbal comments from staff lawyers that led him to believe                   
  the large fine might be a problem.  He went on to detail his                 
  concerns with Line 25 on page two of HB 192, in which the                    
  sale of non-permanent parts of a structure are permitted.                    
  He did not know what that meant.                                             
                                                                               
  Number 657                                                                   
                                                                               
  CHAIRMAN VEZEY believed that referred to tools and                           
  equipment.                                                                   
                                                                               
  Number 660                                                                   
                                                                               
  MR. LUCK asked the committee to define those terms in the                    
  final version of CSHB 192.  He then took issue with                          
  paragraph eight of page two, saying the qualification of                     
  "handymen" would be hard to define without a contract.  He                   
  asked for a definition of "minor, inconsequential, or                        
  casual" labor as mentioned in CSHB 192.                                      
                                                                               
  Number 693                                                                   
                                                                               
  CHAIRMAN VEZEY felt it would be hard to legislate common                     
  sense of what "minor, inconsequential or casual" labor might                 
  be.  He stated the idea was to allow small businessmen to                    
  get started while maintaining some control over the                          
  industry.                                                                    
                                                                               
  Number 698                                                                   
                                                                               
  REPRESENTATIVE OLBERG stated if the department sought only                   
  minor changes, perhaps the committee should hold HB 192.                     
                                                                               
  TAPE 93-38, SIDE A                                                           
  Number 000                                                                   
                                                                               
  MR. LUCK felt the "handyman" work threshold of $2,500 to                     
  $5,000 would be hard for the state to enforce with current                   
  personnel levels.                                                            
                                                                               
  CHAIRMAN VEZEY felt the state should not be trying to                        
  enforce that anyway, because the industry would probably do                  
  the enforcement.                                                             
                                                                               
  Number 050                                                                   
                                                                               
  MR. LUCK stated it would still require more people even if                   
  the industry policed itself, because complaints would still                  
  have to be handled by state commerce officers.  He estimated                 
  it would take at least 12 people statewide to handle the                     
  investigation of complaints.                                                 
                                                                               
  Number 092                                                                   
                                                                               
  CHAIRMAN VEZEY noted Mr. Luck's suggestions, summarized the                  
  amendments the committee might want to make, then                            
  entertained a motion to formalize the latest version of CSHB
  192.  (A copy of the amendments  may be found in the House                   
  State Affairs Committee Room, Capitol Room 102, and after                    
  the adjournment of the second session of the 18th Alaska                     
  State Legislature, in the Legislative Reference Library.)                    
                                                                               
  Number 111                                                                   
                                                                               
  REPRESENTATIVE OLBERG MOVED ADOPTION of the AMENDMENTS.                      
  Members took some moments to familiarize themselves with the                 
  language changes.                                                            
                                                                               
  Number 182                                                                   
                                                                               
  CHAIRMAN VEZEY MOVED the PROPOSED AMENDMENTS.  There were no                 
  objections; the AMENDMENTS to CSHB 192 (STA) WERE ADOPTED.                   
                                                                               
  REPRESENTATIVE OLBERG MOVED PASSAGE of CSHB 192 (STA) from                   
  committee, and asked for unanimous consent.  Without                         
  objections, THE MOTION CARRIED.                                              
                                                                               

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