Legislature(2017 - 2018)SENATE FINANCE 532

05/12/2017 09:00 AM FINANCE

Note: the audio and video recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.

Download Mp3. <- Right click and save file as

* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 111 OIL & GAS PRODUCTION TAX;PAYMENTS;CREDITS TELECONFERENCED
Moved SCS CSHB 111(FIN) Out of Committee
+= SB 34 DRIVER'S LICENSE & ID CARDS & REAL ID ACT TELECONFERENCED
Moved CSSB 34(FIN) Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
SENATE BILL NO. 34                                                                                                            
                                                                                                                                
     "An Act  relating to the implementation  of the federal                                                                    
     REAL  ID  Act of  2005;  and  relating to  issuance  of                                                                    
     identification   cards  and   driver's  licenses;   and                                                                    
     providing for an effective date."                                                                                          
                                                                                                                                
10:06:32 AM                                                                                                                   
                                                                                                                                
Co-Chair  MacKinnon  relayed  that  there was  a  letter  of                                                                    
explanation from the Department  of Administration dated May                                                                    
11,  2017 (copy  on file).  The  letter was  in response  to                                                                    
questions from the committee.                                                                                                   
                                                                                                                                
10:07:16 AM                                                                                                                   
                                                                                                                                
LESLIE   RIDLE,    DEPUTY   COMMISSIONER,    DEPARTMENT   OF                                                                    
ADMINISTRATION,  discussed  the aforementioned  letter  from                                                                    
the   department.   She   explicated  that   the   questions                                                                    
concerning the  process of obtaining  a driver's  license or                                                                    
identification.  She stated  that  Alaskans  would not  need                                                                    
anything  new  in  order  to obtain  Real  I.D.  The  change                                                                    
involved  verification   of  the  proof  of   identity.  The                                                                    
division  was a  member  of AAMVA  [American Association  of                                                                    
Motor Vehicle  Administrators]. The system ensured  that the                                                                    
applicant only  carried one driver's  license. The  DMV from                                                                    
other states  cannot access documents  on the  state system.                                                                    
Documents are not shared with  other entities, other than to                                                                    
check for  pre-existing driver's  licenses in  other states.                                                                    
For this  process, the  name, date of  birth, and  last four                                                                    
digits   of  the   social   security   number  (SSN).   Some                                                                    
information  was  shared  via subpoena  with  Department  of                                                                    
Public Safety for the purposes  of working on cold cases and                                                                    
I.D. fraud.                                                                                                                     
                                                                                                                                
10:11:04 AM                                                                                                                   
                                                                                                                                
Co-Chair  MacKinnon asked  if all  states had  "one driver's                                                                    
license in  one state" rule,  or whether that was  a federal                                                                    
law.                                                                                                                            
                                                                                                                                
Ms. Ridle informed that all states  had the rule but that it                                                                    
was a federal law.                                                                                                              
                                                                                                                                
10:11:37 AM                                                                                                                   
AT EASE                                                                                                                         
                                                                                                                                
10:31:44 AM                                                                                                                   
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair MacKinnon MOVED to ADOPT Amendment 1:                                                                                  
                                                                                                                                
     Page 3, line 5, following "15 years"                                                                                       
     Delete "after the expiration of the identification                                                                         
     card"                                                                                                                      
     Insert "after the date of application"                                                                                     
                                                                                                                                
     Page 3, line 8, following "retain"                                                                                         
     Insert "only"                                                                                                              
                                                                                                                                
     Page 6, line 8, following "years"                                                                                          
     Delete "after the expiration of the license"                                                                               
     Insert "after the date of application"                                                                                     
                                                                                                                                
     Page 6, line 10, following "retain"                                                                                        
     Insert "only"                                                                                                              
                                                                                                                                
Vice-Chair Bishop OBJECTED for discussion.                                                                                      
                                                                                                                                
JULI  LUCKY,   STAFF,  SENATOR  ANNA   MACKINNON,  explained                                                                    
Amendment  1.  She detailed  that  the  amendment should  be                                                                    
starting on page 3, line 5  and the last change should be on                                                                    
page  6, line  10.  These were  technical  fixes within  the                                                                    
bill.  She  specified that it was always the  intent to have                                                                    
a 15-year retention period;  however, currently it contained                                                                    
a retention period  ending after the date  of the expiration                                                                    
of  the  I.D.   card,  which  would  have   been  23  years.                                                                    
Additional    changes    specified   that    only    minimum                                                                    
documentation was required.                                                                                                     
                                                                                                                                
Vice-Chair Bishop WITHDREW his OBJECTION. There being NO                                                                        
OBJECTION, Amendment 1 was ADOPTED.                                                                                             
                                                                                                                                
10:33:30 AM                                                                                                                   
                                                                                                                                
Co-Chair MacKinnon MOVED to ADOPT Amendment 2.                                                                                  
                                                                                                                                
Vice-Chair Bishop OBJECTED for discussion.                                                                                      
                                                                                                                                
Ms. Lucky explained Amendment 2:                                                                                                
                                                                                                                                
     The  intent  of  this  amendment   is  to  require  the                                                                    
     department, should  attempts to discontinue use  of the                                                                    
     social  security   number  as  a  means   of  verifying                                                                    
     identity in order to comply  with federal law requiring                                                                    
     that states  confirm that an applicant  is not licensed                                                                    
     to  drive  in another  state,  to  work to  reduce  the                                                                    
     number  of   digits  of  the  social   security  number                                                                    
     required  and to  limit the  department to  sharing the                                                                    
     minimum   number  of   digits   required,  instead   of                                                                    
     specifying a number of digits.                                                                                             
                                                                                                                                
     Page 4, line 19, following "steps"                                                                                         
          Delete "necessary"                                                                                                    
          Insert "available"                                                                                                    
                                                                                                                                
     Page 4, line 29 through page 5, line 8                                                                                     
          Delete all material                                                                                                   
          Insert "(d) If the department has complied with                                                                       
     (b) and (c)  of this section and been  unable to secure                                                                    
     a  means of  compliance  with P.L.  109-13, Division  B                                                                    
     (REAL  ID  Act  of  2005) that  does  not  involve  the                                                                    
     storage  or  sharing  of social  security  numbers,  in                                                                    
     whole or in  part, the department shall  take all steps                                                                    
     necessary to minimize the number  of digits of a social                                                                    
     security= number required to be stored or shared.                                                                          
                                                                                                                                
     (e)  The  department may  not  share  more than  fewest                                                                    
     number of  digits of a person's  social security number                                                                    
     necessary  to comply  with  federal  law requiring  the                                                                    
     department  to  determine  whether a  person  has  been                                                                    
     issued a driver's license in another state."                                                                               
                                                                                                                                
Ms. Lucky  elaborated that there had  been concern expressed                                                                    
regarding  the  digits  from  a   SSN  for  verification  of                                                                    
identity. The amendment would limit  the use to three digits                                                                    
of the  SSN. She  continued that  the amendment  would allow                                                                    
for use of  the fewest digits. Consistent  with the language                                                                    
in the  bill, the amendment  directed the department  to try                                                                    
not to  use the SSN. The  new provision would state  that if                                                                    
the department  was unsuccessful  in not  using the  SSN, it                                                                    
should take  all steps to  minimize the number  required and                                                                    
use the  fewest number  of digits  required. She  added that                                                                    
this would be adopted as a conceptual amendment.                                                                                
                                                                                                                                
Senator Micciche asked  if Ms. Lucky had  the opportunity to                                                                    
discuss  the amendments  with  the  department to  determine                                                                    
whether  the amendment  compromised  its  ability to  comply                                                                    
with Real I.D.                                                                                                                  
                                                                                                                                
Ms.  Lucky relayed  that she  had  discussed the  amendments                                                                    
with the department, and they were available to confirm.                                                                        
                                                                                                                                
10:36:27 AM                                                                                                                   
                                                                                                                                
MICHAEL   STANKER,  DEPARTMENT   OF   LAW,  ANCHORAGE   (via                                                                    
teleconference),   testified  that   he  had   reviewed  the                                                                    
conceptual  amendment. He  did not  see any  issue with  the                                                                    
amendment.                                                                                                                      
                                                                                                                                
                                                                                                                                
Ms.  Ridle  stated that  conceptual  Amendment  2 would  not                                                                    
affect compliance with Real I.D.                                                                                                
                                                                                                                                
Senator  Micciche  thanked  Ms.   Ridle  for  supplying  the                                                                    
document to the committee.                                                                                                      
                                                                                                                                
                                                                                                                                
Vice-Chair  Bishop WITHDREW  his OBJECTION.  There being  NO                                                                    
OBJECTION, conceptual Amendment 2 was ADOPTED.                                                                                  
                                                                                                                                
Vice-Chair  Bishop discussed  two  zero  fiscal notes,  FN2,                                                                    
Department of  Military and Veterans Affairs,  OMB component                                                                    
number  2657;  and FN3,  Department  of  Public Safety,  OMB                                                                    
component number  523. He stated  that the  department would                                                                    
be providing a new fiscal note.                                                                                                 
                                                                                                                                
Ms. Lucky  commented that  the Department  of Administration                                                                    
(DOA) fiscal  note no longer  applied. The  department would                                                                    
be providing a new fiscal note.                                                                                                 
                                                                                                                                
10:39:30 AM                                                                                                                   
                                                                                                                                
MINTA  MONTALBO,   DEPARTMENT  OF   ADMINISTRATION,  JUNEAU,                                                                    
explained that the  fiscal note would be  updated to reflect                                                                    
the reduction  in cost  because the  CS from  [Senate] State                                                                    
Affairs  required the  cards to  be  produced in-state.  The                                                                    
requirement was  not in the  present version of the  bill so                                                                    
would be removed. There would  be increase in revenue due to                                                                    
a fee  increase in the current  version from $15 to  $20 for                                                                    
compliant driver's licenses.                                                                                                    
                                                                                                                                
10:40:24 AM                                                                                                                   
                                                                                                                                
Senator  Hughes  asked if  Ms.  Montalbo  was aware  of  any                                                                    
discussion  across   the  states  to  members   of  Congress                                                                    
regarding federal funding for the initiative.                                                                                   
                                                                                                                                
Ms. Montalbo was not aware  of any funds coming forward. The                                                                    
division had been working  with the congressional delegation                                                                    
but had not heard of any funds being made available.                                                                            
                                                                                                                                
Co-Chair  MacKinnon  asked  if  there was  going  to  be  an                                                                    
unforeseen  cost to  the state  as a  result of  passing the                                                                    
bill.                                                                                                                           
                                                                                                                                
Ms. Montalbo explained that the  costs were reflected in the                                                                    
current  fiscal  note  and  would remain  the  same  in  the                                                                    
forthcoming  fiscal note.  The  $1.5 million  implementation                                                                    
cost would remain the same.                                                                                                     
                                                                                                                                
Co-Chair  MacKinnon   referred  to  the  $1.5   million  and                                                                    
verified  that  was  for  improvements  in  technology.  Ms.                                                                    
Montalbo replied in  the affirmative. She added  that it was                                                                    
a one-time cost to update their systems.                                                                                        
                                                                                                                                
Co-Chair  MacKinnon asked  about  additional positions.  Ms.                                                                    
Montalbo stated no new positions would be needed.                                                                               
                                                                                                                                
Co-Chair  MacKinnon asked  if the  committee could  expect a                                                                    
fiscal note  with zero expenditures for  operating costs and                                                                    
a  one-time   capital  appropriation  for  the   upgrade  in                                                                    
technology.                                                                                                                     
                                                                                                                                
Ms.  Montalbo stated  that there  was an  ongoing production                                                                    
cost to  make the  compliant cards  of approximately  $5 per                                                                    
card. There would  be an increase in  receipt authority, and                                                                    
in FY  19 there would be  a $528.7 thousand in  the services                                                                    
line of  the fiscal note.  That was anticipated  to increase                                                                    
in out years.                                                                                                                   
                                                                                                                                
Co-Chair MacKinnon expected that  the revenues collected for                                                                    
the program  would exceed the  costs. Ms.  Montalbo answered                                                                    
in the affirmative.                                                                                                             
                                                                                                                                
Co-Chair  MacKinnon asked  if there  was a  need to  rewrite                                                                    
regulation. Ms. Montalbo answered in the affirmative.                                                                           
                                                                                                                                
10:43:31 AM                                                                                                                   
                                                                                                                                
Co-Chair MacKinnon asked if DMV  would absorb that cost. Ms.                                                                    
Montalbo replied in the affirmative.                                                                                            
                                                                                                                                
Co-Chair MacKinnon  asked whether there would  be additional                                                                    
fiscal  notes.  Ms.  Montalbo replied  there  should  be  no                                                                    
additional fiscal notes.                                                                                                        
                                                                                                                                
MARLA  THOMPSON,  DIRECTOR,   DIVISION  OF  MOTOR  VEHICLES,                                                                    
DEPARTMENT  OF ADMINISTRATION  (via teleconference),  stated                                                                    
that  everything  mentioned  would  be  in  the  forthcoming                                                                    
fiscal note.                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon  asked if DMV  would issue a  zero fiscal                                                                    
note on  the operational cost  side and on the  capital cost                                                                    
side. Ms.  Thompson stated that  those would be on  the same                                                                    
fiscal note.                                                                                                                    
                                                                                                                                
Co-Chair clarified there would be  no additional note to the                                                                    
one submitted by DOA.                                                                                                           
                                                                                                                                
Vice-Chair  Bishop  MOVED  to report  CSSB  34(FIN)  out  of                                                                    
Committee   with   individual    recommendations   and   the                                                                    
accompanying and  forthcoming fiscal  notes. There  being NO                                                                    
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
CSSB  34(FIN)  was REPORTED  out  of  committee with  a  "no                                                                    
recommendation"  and with  one new  fiscal impact  note from                                                                    
the Department  of Administration, and with   two previously                                                                    
published zero fiscal notes: FN2(MVA), FN3(DPS).                                                                                
                                                                                                                                
10:45:16 AM                                                                                                                   
AT EASE                                                                                                                         
                                                                                                                                
10:47:17 AM                                                                                                                   
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair MacKinnon stated that the committee would be                                                                           
recessed to a call of the chair and would take up HB 111 in                                                                     
the afternoon.                                                                                                                  
                                                                                                                                
10:48:06 AM                                                                                                                   
RECESSED                                                                                                                        
                                                                                                                                
3:07:34 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                

Document Name Date/Time Subjects
SB 34 DOA Response Memo 4.12.17 LR.pdf SFIN 5/12/2017 9:00:00 AM
SB 34
SB 34 Amendments 1 and 2 MacKinnon.pdf SFIN 5/12/2017 9:00:00 AM
SB 34
HB 111 v V Sectional Analysis.pdf SFIN 5/12/2017 9:00:00 AM
HB 111
HB 111 Senate Finance V 20170512 - Fiscal Impact 2017 Spring Forecast.pdf SFIN 5/12/2017 9:00:00 AM
HB 111
HB 11 Summary of Changes B to V.pdf SFIN 5/12/2017 9:00:00 AM
HB 111 Work Draft version V.pdf SFIN 5/12/2017 9:00:00 AM
HB 111
HB 111 DNR - Size of Tax Credits Surveys.pdf SFIN 5/12/2017 9:00:00 AM
HB 111
HB 111 Amendment 1 MacKinnon.pdf SFIN 5/12/2017 9:00:00 AM
HB 111