Legislature(2005 - 2006)CAPITOL 106

03/17/2005 08:00 AM House STATE AFFAIRS

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Moved CSHB 178(STA) Out of Committee
Moved CSHB 12(STA) Out of Committee
Heard & Held
Scheduled But Not Heard
Bills Previously Heard/Scheduled
Moved HCS CSSB 36(STA) Out of Committee
HB 178-SPECIAL REQUEST LICENSE PLATES                                                                                         
8:27:38 AM                                                                                                                    
CHAIR SEATON announced  that the next order of  business was HOUSE                                                              
BILL  NO.  178,   "An  Act  relating  to  special   motor  vehicle                                                              
registration plates; and providing for an effective date."                                                                      
8:27:39 AM                                                                                                                    
KONRAD JACKSON,  Staff to Representative Kurt Olson,  Alaska State                                                              
Legislature,  introduced  HB  178   on  behalf  of  Representative                                                              
Olson, sponsor.   He explained that  if HB 178 were to  pass, "all                                                              
registration  plates  will  be  available  for use  on  all  motor                                                              
vehicles."      Currently,   passenger    vehicles,   motorcycles,                                                              
noncommercial vans,  pickup trucks, and  motor homes are  the only                                                              
vehicles  allowed  to  display   "nonstandard  license  plates  or                                                              
registration plates."                                                                                                           
8:29:15 AM                                                                                                                    
REPRESENTATIVE  RAMRAS  asked how  he  could put  a  regular-sized                                                              
vanity plate on a motorcycle.                                                                                                   
MR.  JACKSON replied,  "It would  not  actually be  the same  size                                                              
license  plate.  It  would be  a motorcycle-sized  plate with  the                                                              
custom lettering."                                                                                                              
8:29:59 AM                                                                                                                    
REPRESENTATIVE  GATTO asked  if state vehicles  would be  included                                                              
under the bill.                                                                                                                 
MR. JACKSON  deferred  to the director  of the  Division of  Motor                                                              
8:31:26 AM                                                                                                                    
DUANE  BANNOCK,  Director,  Division   of  Motor  Vehicles  (DMV),                                                              
Alaska Department  of Administration,  replied  that the  State of                                                              
Alaska could  choose to  put a personalized  license plate  on one                                                              
of its vehicles and pay the extra fee.                                                                                          
8:32:33 AM                                                                                                                    
REPRESENTATIVE  GATTO pointed  out that  on page  6, lines  10-11,                                                              
the bill refers  to "a vehicle owned by the state"  and "a vehicle                                                              
owned by  an elected  state official."   He  asked if  perhaps the                                                              
language  should  include  vehicles  owned by  a  municipality  or                                                              
other government entity.                                                                                                        
MR. BANNOCK  responded that there  are other sections of  the bill                                                              
that deal with local governments.  He said:                                                                                     
     This bill is  not about vehicle registration  or the fee                                                                   
     that  someone   does  or  does   not  pay  for   vehicle                                                                   
     registration.   This bill  is about  the piece of  metal                                                                   
     that  goes  on  the  vehicle  that  is  the  subject  of                                                                   
     vehicle  registration, regardless  of what  the cost  of                                                                   
     the registration is.                                                                                                       
8:34:03 AM                                                                                                                    
REPRESENTATIVE  GARDNER  stated  that under  the  current  license                                                              
plate system,  a person  can identify vehicles  that are  owned by                                                              
the government  by the number.   She asked if that would  still be                                                              
true if HB 178 passed.                                                                                                          
MR. JACKSON  said there would  not be a change  to that.   He said                                                              
that  he  didn't  foresee  any  instance  where  the  state  would                                                              
"change that registration."                                                                                                     
REPRESENTATIVE  GARDNER commented  that the  bill language  leaves                                                              
the option open.   She opined, "There's a value  in citizens being                                                              
able  to tell  which vehicles  are  government-owned because  they                                                              
want to watch and see if [the vehicles] are used appropriately."                                                                
CHAIR  SEATON stated,  "As I  understand it,  this doesn't  change                                                              
the policy decisions that are made by any department."                                                                          
REPRESENTATIVE   RAMRAS    expressed,   for   the    record,   his                                                              
appreciation  for  the  "exemplary  service"  at  the  Juneau  DMV                                                              
8:36:51 AM                                                                                                                    
REPRESENTATIVE GRUENBERG  turned to page  6, line 12,  which read,                                                              
"the fee  required for that  vehicle under  (b), (c), (h),  or (i)                                                              
of  this  section."    He  asked  if  this  language  would  allow                                                              
legislators to get  a legislative plate for their  motorcycles and                                                              
MR. BANNOCK responded:                                                                                                          
     There    are   four   key    categories   for    vehicle                                                                   
     registration:     [Subsection   (b)]  is  most   common,                                                                   
     noncommercial   registration;     [subsection  (c)]   is                                                                   
     commercial  registration, which  is a two-year  biannual                                                                   
     commercial  registration;   [subsection (h)]  references                                                                   
     annual  commercial  registration; and  [subsection  (i)]                                                                   
     references the permanent trailer registration.                                                                             
8:40:19 AM                                                                                                                    
REPRESENTATIVE   GATTO  commented   that  he  and   Representative                                                              
Gruenberg have  been involved in  getting interlocks  installed in                                                              
vehicles under  certain circumstances.   He  asked if  there would                                                              
be any  value in  having identification  on a  license plate  of a                                                              
vehicle that has an interlock devise installed.                                                                                 
MR. BANNOCK replied:                                                                                                            
     As to  whether or not  the plate itself should  identify                                                                   
     that  [there is  an interlock  device  in the  vehicle],                                                                   
     that  is  an  excellent debate.    It's  been  discussed                                                                   
     among  others  of you  in  Juneau,  and there  are  some                                                                   
     major  hurdles   because,  in  the  [DMV],   our  system                                                                   
     records  you as  an individual  for one  record, and  we                                                                   
     record  your automobile  as a separate  record that  you                                                                   
     just happen  to be an owner  of.  As a result,  there is                                                                   
     no direct  connection between  the alcohol offender  and                                                                   
     the  vehicle  that  that  alcohol   offender  owns.  ...                                                                   
     [That]  doesn't mean  that  it can't  be  done, it  just                                                                   
     means that if  we were to go in that direction,  I would                                                                   
     be looking for some additional resources.                                                                                  
8:43:11 AM                                                                                                                    
REPRESENTATIVE RAMRAS  commented that his office  determined there                                                              
would be a $12  million fiscal note to attach  the "scarlet letter                                                              
license plate" to a vehicle.                                                                                                    
8:43:55 AM                                                                                                                    
REPRESENTATIVE GARDNER asked what interlock is.                                                                                 
REPRESENTATIVE  GATTO explained  that  it is  a Breathalyzer  that                                                              
won't  let an  intoxicated  person  start his/her  car.   He  then                                                              
pointed  out to  Mr. Bannock,  "One  cannot help  but notice  that                                                              
some  of those  unmarked  police  cars  have those  three  letters                                                              
'AST',  and  were someone  to  apply  for  those, I  guess  that's                                                              
prohibited, as would be 'XXX'."                                                                                                 
8:44:45 AM                                                                                                                    
MR. BANNOCK replied:                                                                                                            
     Regulation speaks  to that.   And while we do  have some                                                                   
     proposed  regulation changes  that will  help us in  our                                                                   
     zeal to  get more  personalized plates  on the road,  we                                                                   
     have  no  intention of  allowing  a  customer to  get  a                                                                   
     license plate  that could be  in ... any way,  shape, or                                                                   
     form confused  with an Alaska  State Trooper car  or any                                                                   
     other  government  exempt  car.   For  instance,  ['XXE'                                                                   
     has] a  specific implication,  and there are  other sets                                                                   
     of  criteria that  we  already utilize.    We intend  to                                                                   
     continue that policy through regulation.                                                                                   
8:45:29 AM                                                                                                                    
REPRESENTATIVE  GARDNER pointed  out  that page  3,  line 12  says                                                              
that registration  plates  issued to legislators  remain  with the                                                              
owner of the vehicle  only during the term of office.   She asked,                                                              
"What's the mechanism by which this is upheld?"                                                                                 
MR.  BANNOCK responded  that  he  believed that  distribution  and                                                              
recall of those  plates is done through the Office  of Legislative                                                              
Affairs in Juneau.                                                                                                              
CHAIR  SEATON  commented that  he  knows  there  are a  number  of                                                              
plates that are signed and auctioned off.                                                                                       
8:47:16 AM                                                                                                                    
REPRESENTATIVE GRUENBERG  commented that  as he understood  it, an                                                              
elected  official can  retain the  plates  once he/she  is out  of                                                              
office, but the plates  can't be on the car anymore.   He moved to                                                              
[adopt  an amendment]  which would  delete the  final sentence  on                                                              
page 3, lines 11-13.                                                                                                            
CHAIR  SEATON  objected  for  discussion  purposes  and  suggested                                                              
changing  the sentence to  read, "The  registration plates  issued                                                              
under this  subsection may remain  on the vehicle only  during the                                                              
official's term of office."                                                                                                     
8:48:57 AM                                                                                                                    
REPRESENTATIVE  GRUENBERG withdrew his  previous motion,  and then                                                              
moved to adopt a new Conceptual Amendment 1:                                                                                    
     Page 3, lines 11-12, after "subsection":                                                                                   
     Delete "remain with the owner of"                                                                                          
     Insert "may remain on"                                                                                                     
REPRESENTATIVE  ELKINS  said  he   thought  the  current  language                                                              
already says that, and therefore the amendment was not needed.                                                                  
CHAIR SEATON said  that there seems to be confusion  about whether                                                              
plates  were recalled  from  legislators  at the  end  of term  of                                                              
office.   He  commented  that the  amendment  would  clear up  the                                                              
8:51:05 AM                                                                                                                    
REPRESENTATIVE ELKINS objected to Conceptual Amendment 1.                                                                       
REPRESENTATIVE  GARDNER clarified  that the  amendment would  make                                                              
it  legal  for  legislators  to keep  the  legislative  plates  as                                                              
souvenirs, but not keep the plates on their vehicles.                                                                           
REPRESENTATIVE ELKINS removed his objection.                                                                                    
[There being no objection, Conceptual Amendment 1 was adopted.]                                                                 
8:52:15 AM                                                                                                                    
REPRESENTATIVE  GARDNER pointed  out, "I  don't like  the idea  of                                                              
state  officials' license  plates being  on commercial  vehicles."                                                              
She suggested a  conceptual amendment which would  retain the word                                                              
"noncommercial" on  page 3, line  9, and take out  subsections (c)                                                              
and (h)  on page  6, line  12.  "I  just think  that it's  sort of                                                              
inappropriate  to blend  legislative  duties  and privileges  with                                                              
commercial activities," she commented.                                                                                          
CHAIR SEATON  stated that  the bill  addressed all vanity  plates,                                                              
not just those  owned by legislators.  He asked  if Representative                                                              
Gardner thought  there should  be no  commercial vanity  plates at                                                              
REPRESENTATIVE GARDNER  stated that she doesn't  think legislative                                                              
plates should be on a commercial vehicle.                                                                                       
8:53:32 AM                                                                                                                    
REPRESENTATIVE GRUENBERG  suggested deleting the language  on page                                                              
6, line 12.                                                                                                                     
CHAIR SEATON  asked Mr.  Bannock which sections  would need  to be                                                              
removed to address Representative Gardner's concerns.                                                                           
MR. BANNOCK  replied that changes  would need  to be made  to page                                                              
3, line 9.                                                                                                                      
8:55:03 AM                                                                                                                    
REPRESENTATIVE GARDNER  pointed out that [subsection  (b)] on page                                                              
6, line  12 refers to noncommercial  vehicles, and  therefore that                                                              
should remain  in the  bill, while  (c) and (h)  in the  same line                                                              
refer  to commercial  vehicles,  and therefore  should be  removed                                                              
from the bill.                                                                                                                  
8:55:31 AM                                                                                                                    
REPRESENTATIVE LYNN  asked if a vehicle would be  considered to be                                                              
commercial if it had a magnetic business sign on it.                                                                            
MR. BANNOCK  replied that Section  4 of  the bill only  applies to                                                              
the legislators,  and the DMV  "doesn't have any  heartburn" about                                                              
what becomes of this section.  He continued:                                                                                    
     The  principle behind  the  matter is  that  it is  your                                                                   
     director's  opinion that  there  are a  lot of  vehicles                                                                   
     that  should  be  paying  commercial  registration  fees                                                                   
     that,   quite  frankly,   are   not  paying   commercial                                                                   
     registration  fees, and  one of the  reasons we  suspect                                                                   
     that they are  not paying commercial fees  is because of                                                                   
     some  of the  laws prohibiting  the  display of  license                                                                   
     plates on those commercial vehicles.                                                                                       
MR. BANNOCK  explained that if a  person were to lease  a car, the                                                              
car title and registration  would be in the name  of the financial                                                              
services  company; based  on the  way  the car  is registered,  it                                                              
would  be considered  a commercial  vehicle.   He stated that  the                                                              
reason for  changes [that would be  made by the bill]  is that the                                                              
cost of  the registration  is predicated upon  how the  vehicle is                                                              
titled.  He continued:                                                                                                          
     We do not  feel that it is appropriate that  the license                                                                   
     plate  rules  be  predicated   upon  the  price  of  the                                                                   
     registration,  which is  why we made  these changes,  so                                                                   
     that  if  you did  lease  that  [car]  and you  did  pay                                                                   
     higher commercial  use registration  fees, but  [if] you                                                                   
     still  wanted to  put a  personalized  license plate  on                                                                   
     it, you would have that opportunity to do so.                                                                              
8:59:20 AM                                                                                                                    
REPRESENTATIVE  GARDNER  commented, "The  distinction  is then  in                                                              
terms  of the  ownership  of the  vehicle, not  the  usage of  the                                                              
vehicle.   And my  concern is  that legislative  plates not  be on                                                              
vehicles that are visibly commercially used."                                                                                   
MR.  BANNOCK replied  that the  DMV has  developed the  "three-way                                                              
test,"  which he  explained is  a statutorily  dictated test  that                                                              
determines what is a commercial vehicle.  He continued:                                                                         
     Step  test number one:  is [the  vehicle] registered  in                                                                   
     the name of  a business or a company?  Step  number two:                                                                   
     does  it weigh  in excess  of  10,000 pounds,  excluding                                                                   
     motor homes  and buses?  Step  number three: is  it used                                                                   
     commercially?   And then we go in different  sections of                                                                   
     the  code of  the  statute book  to  determine what  the                                                                   
     delimitation of "used commercially" is.                                                                                    
MR. BANNOCK  explained that  if a vehicle  is used for  commercial                                                              
purposes,  however  rarely,  it   is  still  considered  to  be  a                                                              
commercial vehicle.                                                                                                             
9:01:38 AM                                                                                                                    
REPRESENTATIVE GATTO  asked if the words on page 3,  line 9 should                                                              
be  changed  from  "noncommercial"  to  "not-for-profit  passenger                                                              
vehicle" instead.                                                                                                               
MR. BANNOCK replied,  "I hesitate to answer that  because there is                                                              
already  a  statutory  provision   that  defines  what  commercial                                                              
registration is."   He presented an  example of a vehicle  that is                                                              
used seasonally  for business  purposes,  and asked the  committee                                                              
if this vehicle  would be included as a  "not-for-profit passenger                                                              
CHAIR  SEATON  asked  the  committee   members  to  rethink  their                                                              
concerns about the language in the bill.                                                                                        
9:03:47 AM                                                                                                                    
REPRESENTATIVE  GARDNER  asked Mr.  Bannock  if the  fees  charged                                                              
cover the costs paid for vanity plates.                                                                                         
MR. BANNOCK  answered,  "Yes, many  times over."   In response  to                                                              
Chair Seaton,  he confirmed that  the vanity plates provide  a net                                                              
income to the general fund.                                                                                                     
9:04:38 AM                                                                                                                    
CHAIR SEATON closed public testimony.                                                                                           
9:04:52 AM                                                                                                                    
REPRESENTATIVE  GARDNER asked Mr.  Bannock why  there is  a fiscal                                                              
note  for  this  bill  if  the  vanity  plate  program  is  income                                                              
MR. BANNOCK  replied that there  is a $5,000  cost in  fiscal year                                                              
(FY)  06 for  changing  the programming  in  the DMV  system.   He                                                              
noted,  "Under changes  in  revenues, we  have  suggested quite  a                                                              
large increase  in revenues  compared to  the capital  expenditure                                                              
to pay for the plates themselves."                                                                                              
9:05:51 AM                                                                                                                    
REPRESENTATIVE  LYNN  mentioned   that  there  is  a  bill  [being                                                              
considered]  in  the  House  Special  Committee  on  Military  and                                                              
Veterans'  Affairs  involving  license  plates  for  Purple  Heart                                                              
REPRESENTATIVE  GRUENBERG  proposed  an  amendment  on  behalf  of                                                              
himself and  Representative Lynn  that would  add language  to the                                                              
bill which would  allow recipients of the Purple  Heart to receive                                                              
the [special license] plate without paying the $30 fee.                                                                         
CHAIR  SEATON noted  that  HB  178 does  not  modify  fees or  fee                                                              
REPRESENTATIVE  LYNN  asked  Mr.  Bannock how  many  Purple  Heart                                                              
license plates there are currently in Alaska.                                                                                   
MR.  BANNOCK  replied that  he  didn't  have that  information  at                                                              
hand,  but he  did  know that  there  are a  total  of 52  special                                                              
license  plates for  Purple Heart  recipients,  Prisoners of  War,                                                              
and Pearl Harbor survivors.                                                                                                     
CHAIR  SEATON remarked  that if  the Purple  Heart license  plates                                                              
become free, more people may apply.                                                                                             
9:09:40 AM                                                                                                                    
REPRESENTATIVE GRUENBERG  said he  offered the amendment  with the                                                              
proviso  that  if   Representative  Olson  objected   to  it,  the                                                              
amendment would be deleted.                                                                                                     
MR.  BANNOCK retracted  his previous  answer, and  stated that  he                                                              
now had the correct  information which showed that  in FY 03 there                                                              
were a total of 509 Purple Heart license plates in Alaska.                                                                      
REPRESENTATIVE  GRUENBERG  clarified   that  if  this  number  was                                                              
correct,  then  his  proposed  amendment  would  equal  a  $15,270                                                              
reduction [in funds to the state].                                                                                              
9:10:53 AM                                                                                                                    
CHAIR  SEATON remarked  that if  the  amendment were  to cost  the                                                              
state about $15,000,  then the 2008-9 fiscal note  which says that                                                              
there  would be  a  [net income]  of  $10,000  would then  instead                                                              
become a cost of $5,000 to the state.                                                                                           
MR. BANNOCK  pointed out that even  if there were 509  such plates                                                              
today,  it doesn't  mean that  there were  that many  issued in  a                                                              
single year;  some of the plates  could have been issued  20 years                                                              
9:11:58 AM                                                                                                                    
REPRESENTATIVE  GRUENBERG stated  that the  text of the  amendment                                                              
would modify AS  28.10.421 (d)(2), on page 6, line  1 of the bill,                                                              
changing  the  figure "$30"  to  "none".    He remarked  that  the                                                              
amendment  would  also  modify   AS  28.10.431(h)  to  add  "or  a                                                              
recipient of a Purple  Heart" to make it clear  that the applicant                                                              
must still  pay the  registration  fee, but is  exempted from  the                                                              
$30 fee for the plate.                                                                                                          
9:13:29 AM                                                                                                                    
REPRESENTATIVE  GATTO  asked  if  a [legislator]  who  is  also  a                                                              
contractor  is allowed  to have  a  legislator plate  on his  work                                                              
MR. BANNOCK  answered that this  might be possible.   He explained                                                              
that if the contractor  had disclosed to the DMV  that he uses the                                                              
truck commercially,  he would not  be able to put  the legislative                                                              
plate on  his truck.  If  he did not  disclose to the DMV  that he                                                              
uses the  truck for work,  the bill would  have no effect  on him.                                                              
If the  bill were  to pass,  the contractor  who disclosed  to the                                                              
DMV that the truck  is used commercially would now  be able to use                                                              
legislative plates.                                                                                                             
9:14:39 AM                                                                                                                    
REPRESENTATIVE  GATTO  commented  that  he was  confused  by  this                                                              
answer.   He offered his  own example in  which a contractor  goes                                                              
to  a worksite  with  a legislator's  plate  on  his truck,  which                                                              
gives  the  contractor "a  bit  of  an unfair  advantage"  because                                                              
perhaps  the client  will then  view  the contractor  in a  better                                                              
MR. BANNOCK  replied that Representative  Gatto was  correct about                                                              
how the  bill could be  applied.  He  said, "We have  a tremendous                                                              
amount  of  automobiles in  Alaska  that  meet the  definition  of                                                              
'commercial' ...  but have not been  disclosed to the [DMV]  so we                                                              
think that they are noncommercial vehicles."  He continued:                                                                     
     I believe  I understand what  your concern is.   It goes                                                                   
     back to the  intent of how the vehicle ...  is currently                                                                   
     registered.   If that person that you're  describing has                                                                   
     disclosed   to  the   [DMV]  that  the   vehicle  is   a                                                                   
     commercial  use  vehicle,  under the  rules  today  that                                                                   
     person  could not  display their  legislative plates  on                                                                   
     that vehicle.                                                                                                              
9:17:39 AM                                                                                                                    
REPRESENTATIVE  GATTO pointed  out  that under  current law,  that                                                              
person would  be violating the law  for failure to  disclose; this                                                              
legislation would  simply give him the privilege  of not violating                                                              
the law.                                                                                                                        
MR. BANNOCK said,  "This change that we're proposing  doesn't have                                                              
anything to  do with that  violation because until  that violation                                                              
is cured,  the customer  comes in,  reregisters  his vehicle  as a                                                              
commercial vehicle.   That violation is still  going on regardless                                                              
of what  type of  plate they're  displaying on  the vehicle."   He                                                              
noted  that there  have  been several  recent  court decisions  in                                                              
Alaska that backed  up this position; that the use  of the vehicle                                                              
predicates  if a  vehicle  should be  required  to pay  commercial                                                              
registration or not.                                                                                                            
9:19:08 AM                                                                                                                    
REPRESENTATIVE GARDNER  expressed her concern  that it may  not be                                                              
appropriate  for   someone  to  be  visibly  doing   a  commercial                                                              
activity with legislative plates on the vehicle.                                                                                
CHAIR SEATON commented,  "Hopefully we will have  legislators that                                                              
use  their discretion  on  legislative  plates and  consider  that                                                              
within the  ethical bounds instead  of the statutory bounds."   He                                                              
reminded  the  committee  that Conceptual  Amendment  1  had  been                                                              
9:20:52 AM                                                                                                                    
REPRESENTATIVE  GARDNER moved to  report HB  178, as amended,  out                                                              
of   committee    with   individual   recommendations    and   the                                                              
accompanying  fiscal  notes.    There  being  no  objection,  CSHB
178(STA)  was reported  out of  the House  State Affairs  Standing                                                              

Document Name Date/Time Subjects