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
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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 Vehicles. 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 office. 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 trailers. 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 confusion. 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 all. 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 vehicle". 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 generating. 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 recipients. 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 structures. 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 ago. 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 truck. 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 light. 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 adopted. 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 Committee.