Legislature(1999 - 2000)
04/19/1999 01:15 PM House JUD
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE JUDICIARY STANDING COMMITTEE
April 19, 1999
1:15 p.m.
MEMBERS PRESENT
Representative Pete Kott, Chairman
Representative Joe Green
Representative Norman Rokeberg
Representative Jeannette James
Representative Lisa Murkowski
Representative Eric Croft
Representative Beth Kerttula
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE JOINT RESOLUTION NO. 30
Proposing amendments to the Constitution of the State of Alaska
repealing provisions relating to the constitutional budget reserve
fund and providing that the balance in the fund be deposited into
the budget reserve fund established by statute.
- MOVED CSHJR 30(JUD) OUT OF COMMITTEE
HOUSE BILL NO. 146
"An Act relating to civil liability for commercial recreational
activities; and providing for an effective date."
- MOVED CSHB 146(JUD) OUT OF COMMITTEE
HOUSE BILL NO. 85
"An Act relating to licensure and professional discipline of
members of the teaching profession and providing for related
penalties; relating to grounds for dismissal of a teacher; relating
to the Professional Teaching Practices Commission; relating to
limited immunity for procedures under the Educator Ethics Act;
making conforming amendments; and providing for an effective date."
- MOVED CSHB 85(JUD) OUT OF COMMITTEE
HOUSE BILL NO. 158
"An Act relating to the annual report of the director of the
division of insurance and to notice of cancellation of personal
insurance."
- SCHEDULED BUT NOT HEARD
(* First public hearing)
PREVIOUS ACTION
BILL: HJR 30
SHORT TITLE: CONST. AM: REPEAL BUDGET RESERVE FUND
SPONSOR(S): REPRESENTATIVES(S) JAMES
Jrn-Date Jrn-Page Action
3/19/99 513 (H) READ THE FIRST TIME - REFERRAL(S)
3/19/99 513 (H) JUDICIARY, FINANCE
4/12/99 (H) JUD AT 1:00 PM CAPITOL 120
4/12/99 (H) SCHEDULED BUT NOT HEARD
4/15/99 (H) JUD AT 1:00 PM CAPITOL 120
4/15/99 (H) HEARD AND HELD
4/15/99 (H) MINUTE(JUD)
4/19/99 (H) JUD AT 1:00 PM CAPITOL 120
BILL: HB 146
SHORT TITLE: LIABILITY FOR COMMERCIAL REC ACTIVITIES
SPONSOR(S): REPRESENTATIVES(S) KOTT, Dyson
Jrn-Date Jrn-Page Action
3/19/99 515 (H) READ THE FIRST TIME - REFERRAL(S)
3/19/99 515 (H) L&C, JUD
3/31/99 642 (H) COSPONSOR(S): DYSON
4/12/99 (H) L&C AT 3:15 PM CAPITOL 17
4/12/99 (H) MOVED CSHB 146(L&C) OUT OF COMMITTEE
4/12/99 (H) MINUTE(L&C)
4/14/99 810 (H) L&C RPT CS(L&C) 2DP 5NR
4/14/99 810 (H) DP: HARRIS, ROKEBERG; NR: MURKOWSKI,
4/14/99 810 (H) CISSNA, SANDERS, BRICE, HALCRO
4/14/99 810 (H) ZERO FISCAL NOTE (COURT)
4/19/99 (H) JUD AT 1:00 PM CAPITOL 120
BILL: HB 85
SHORT TITLE: TEACHERS' LICENSES, DISCIPLINE & ETHICS
SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR
Jrn-Date Jrn-Page Action
2/10/99 186 (H) READ THE FIRST TIME - REFERRAL(S)
2/10/99 186 (H) HES, JUDICIARY, FINANCE
2/10/99 186 (H) ZERO FISCAL NOTE (DOE)
2/10/99 186 (H) GOVERNOR'S TRANSMITTAL LETTER
3/04/99 (H) HES AT 3:00 PM CAPITOL 106
3/04/99 (H) <BILL CANCELED>
3/27/99 (H) HES AT 10:00 AM CAPITOL 106
3/27/99 (H) MOVED OUT OF COMMITTEE
3/27/99 (H) MINUTE(HES)
3/29/99 598 (H) HES RPT 2DP 3NR
3/29/99 599 (H) DP: DYSON, WHITAKER; NR: GREEN,
MORGAN,
3/29/99 599 (H) COGHILL
3/29/99 599 (H) ZERO FISCAL NOTE (DOE) 2/10/99
3/29/99 599 (H) REFERRED TO JUD
4/19/99 (H) JUD AT 1:00 PM CAPITOL 120
WITNESS REGISTER
TAMARA COOK, Director
Legislative Legal and Research Services
Legislative Affairs Agency
130 Seward Street, Suite 409
Juneau, Alaska 99801-2105
Telephone: (907) 465-2450
POSITION STATEMENT: Answered questions of the committee members on
HJR 30.
KELLY SULLIVAN, Legislative Secretary
for Representative Pete Kott
Alaska State Legislature
Capitol Building, Room 118
Juneau, Alaska 99801
Telephone: (907) 465-3777
POSITION STATEMENT: Presented sponsor statement on HB 146.
MIKE WINDRED, Vice President
Marketing and Sales
Alaska Travel Adventures
9085 Glacier Highway, Suite 301
Juneau, Alaska 99801
Telephone: (907) 789-0052
POSITION STATEMENT: Testified in support of HB 146.
BOB ENGELBRECHT, Owner
North Star Trekking
1602 Laurie Lane
Juneau, Alaska 99801
Telephone: (907) 790-4530
POSITION STATEMENT: Testified in support of HB 146.
MIKE FORD, Attorney
Legislative Legal Counsel
Legislative Legal and Research Services
Legislative Affairs Agency
130 Seward Street, Suite 409
Juneau, Alaska 99801-2105
Telephone: (907) 465-2450
POSITION STATEMENT: Answered questions of the committee members on
HB 146.
RUSSELL L. WINNER
Alaska Academy of Trial Lawyers
900 West 5th Avenue, Suite 700
Anchorage, Alaska 99501
Telephone: (907) 277-9522
POSITION STATEMENT: Testified in opposition to HB 146.
SANNA GREEN, Executive Director
Professional Teaching Practices Commission
Department of Education
344 West 3rd Avenue, Suite 127
Anchorage, Alaska 99501
Telephone: (907) 269-6579
POSITION STATEMENT: Testified in support of HB 85.
TERESA WILLIAMS, Assistant Attorney General
Fair Business Practices Section
Civil Division
Department of Law
1031 West 4th Avenue, Suite 200
Anchorage, Alaska 99501-1994
Telephone: (907) 269-5100
POSITION STATEMENT: Testified on HB 85.
ACTION NARRATIVE
TAPE 99-34, SIDE A
Number 0001
CHAIRMAN PETE KOTT called the House Judiciary Standing Committee
meeting to order at 1:15 p.m. Members present at the call to order
were Representatives Kott, Rokeberg, James and Murkowski.
Representatives Kerttula, Croft and Green arrived at 1:20 p.m.,
1:22 p.m. and 2:06 p.m., respectively.
HJR 30 - CONST. AM: REPEAL BUDGET RESERVE FUND
CHAIRMAN KOTT announced the first order of business is HJR 30,
Proposing amendments to the Constitution of the State of Alaska
repealing provisions relating to the constitutional budget reserve
fund and providing that the balance in the fund be deposited into
the budget reserve fund established by statute.
CHAIRMAN KOTT called on Representative Jeannette James, sponsor of
the resolution.
Number 0060
REPRESENTATIVE JAMES stated that ever since she has been in the
legislature she has been aware of the constitutional budget reserve
fund and the problems that it has created for legislators. It
didn't turn out like it was intended. It was there to collect
taxes. It has done that, but testimony from the Administration has
indicated that the state can only expect back $1.6 million per year
from back taxes. She thinks it has outlived its usefulness and
should go away and in its place there should be a long-term plan.
Where the money should go she doesn't know, however. When she
wrote the resolution, she suggested that it should go into the
statutory budget reserve. That's where funds were building before.
It has been empty for a long time and has quite a few restrictions
on it, so maybe, that's not a good place. She suggested putting it
in the earnings reserve of the permanent fund or the general fund.
Wherever it is put, the deposit needs to get the highest rate of
return as possible.
REPRESENTATIVE JAMES further stated the constitutional budget
reserve fund has been a burden between the majority and the
minority with the three-fourth vote requirement. It has caused a
lot of distress over the years, and it is time to put that behind.
The biggest problem is that any money borrowed has to be paid back,
and as long as it is there even if it's empty every year the
legislature has to "scarf off" everything at the end of the year
that's available for appropriation and pay it back creating a sweep
provision in the budget. That is a problem and as long as it's on
the books the legislature will continue to have to deal with it.
Number 0263
CHAIRMAN KOTT asked Representative James what would happen to the
monies that the legislature owes to the fund. Does it go away? Is
the legislature no longer obligated to repay it? Does that
obligation revert to where ever the legislature decides to deposit
the remaining monies from the constitutional budget reserve?
Number 0315
REPRESENTATIVE JAMES replied, she assumes, if the fund goes away
that any debt to it would go away. Maybe the constitutional
amendment needs to be clearer to indicate that any debt would be
extinguished. She suggested getting a legal opinion.
Number 0355
CHAIRMAN KOTT said the constitutional amendment would need to be
clear to the voters. "I'm sure there'd be some motivation out
there within the public that would decry that we borrowed money
from this fund and now this is a roundabout way to at least prevent
us from paying it back."
REPRESENTATIVE JAMES stated, it is her personal opinion, the people
do not understand that it has to be paid back. It's not even an
issue. They just think it's a place to put money.
Number 0393
CHAIRMAN KOTT stated he completely agrees with Representative
James. He's not sure that he would want to put that in language in
the constitutional amendment, unless it was not clear from a legal
standpoint of the legislature's obligation. If a legal opinion
says that the obligation goes away with the fund and that the money
is transferred to another account that would be fine. The more
included in a constitutional amendment, the more confused the voter
would be.
Number 0435
REPRESENTATIVE JAMES stated, if the constitutional budget reserve
fund is repealed, everything that is currently in it would go away.
The payback is in the existing language in the constitution.
Number 0455
REPRESENTATIVE MURKOWSKI asked Representative James whether she
thinks that the money deposited from the closure of the fund should
be defined in the constitutional amendment, so that people know
where it will go, or whether there is something that can be done
afterwards.
Number 0513
REPRESENTATIVE JAMES replied it seems that part of repealing a
constitutional fund would include what would be done to the money
in there. There could be language that says, "at the will of the
legislature" or "subject to legislative appropriation" or "put it
in the earnings of the permanent fund to be managed with the rest
of it" or "the statutory budget reserve fund."
Number 0580
REPRESENTATIVE MURKOWSKI noted that much of the public debate is
emotional in regards to the funds that the legislature has access
to, which is why the constitutional budget reserve came about in
the first place. The legislature, therefore, has to be cautious in
terms of how this is presented, so that it's not perceived as one
more way that the legislature want's to take a person's money and
spend it "willy-nilly."
Number 0630
REPRESENTATIVE JAMES suggested informing the newer legislators of
the history of the constitutional budget reserve fund. She
explained it was passed in 1990. At that time, there was a dispute
between the legislature and former-Governor Hickel of what
constituted a back-tax settlement. Where did the process start?
Were administrative appeals included or did it mean going to court
for a settlement? Money came in 1991 and 1992, and the governor
and the administration took the position that the money did not
have to go into the constitutional budget reserve fund. Another
issue was, when can it be used with a majority vote? The
constitution says that if the incoming money is less than the
amount used in the previous year's budget, then it can be accessed
with a majority vote. But, for any other time or reason money is
taken out of the constitutional budget reserve fund, a
three-fourths vote is needed. Beyond that, any money used out of
the constitutional budget reserve fund has to be paid back. Thus,
at June 30 of every year, any money that has not been appropriated
is "scarfed off" to pay back the money that has been borrowed.
Consequently, the little funds like the marine highway fund gets
swept in and eventually swept out under the "sweep provision." She
noted the sweep provision says that any money swept in to pay back
the constitutional budget reserve fund gets swept back to where it
was because the sate can't afford to short the money. The court
said, in 1993, that the money available for appropriations, when
comparing it to last year's budget, includes the permanent fund
earnings, but it doesn't count when it comes to the sweep
provision. The court also said that once money was collected from
a tax appeal it needs to go into the constitutional budget reserve
fund. She noted that there has been over $7 billion collected and
put into the fund, and over one-half has been used. The state has
never had the ability to pay it back, and she doesn't see any real
ability to pay it back in the future. She reiterated the
constitutional budget reserve fund is not working, like the
election pamphlet said it would work, when she voted for it.
Number 0933
REPRESENTATIVE CROFT stated it doesn't work because the state never
gets to the point where appropriations are greater than the amount
available for appropriations. There is always an amount left over
after paying for dividends and providing for inflation-proofing,
which he thinks are appropriations. There is always an amount left
standing in the earnings reserve of the permanent fund. That
amount clearly means that there isn't a deficit in terms of
accounting. The court decision was correct. The state has never
spent more than what was available for appropriations. It's not so
much of a weird court decision, but weird accounting. But, because
the state has never been in a position of deficit, the state has
not had the constitutional authority to truly get into the
constitutional budget reserve fund. The state has only had
three-fourth authority to borrow from it creating an oddity.
Number 1020
REPRESENTATIVE CROFT asked Representative James why she is ending
the constitutional budget reserve fund rather than amending it, and
whether she means to deposit the money into the earnings reserve of
the permanent fund or some other statutory fund that would need to
be created.
Number 1040
REPRESENTATIVE JAMES replied it is up to the committee. She
reiterated she selected the statutory budget reserve account
because it is already on the books and is empty.
REPRESENTATIVE JAMES further stated she agrees with not counting
the earnings reserve money that's available for appropriation, but
it is counted in the beginning, so why isn't it counted in the
payback. That's the problem. As long as the state is short of
funds, it will never get paid back.
Number 1086
REPRESENTATIVE CROFT stated it counts in both places because money
available for appropriation is everything that the state has coming
in.
REPRESENTATIVE JAMES said, according to the court decision, it
doesn't count in the sweep provision.
Number 1102
REPRESENTATIVE CROFT said the state is forced to sweep it back
because it has always had more money available for appropriation
than what has been appropriated.
REPRESENTATIVE JAMES noted that the money doesn't sweep out of the
earnings reserve of the permanent fund, only the other funds.
Number 1116
REPRESENTATIVE CROFT noted that that money was never appropriated.
He cited, as an example, if the state earns $1.5 billion, it will
need another $900 million for dividends and $300 million for
inflation-proofing resulting in $300 million left. If the
legislature acts like it has for the past five years, it will leave
that sit in the earnings reserve of the permanent fund, and proper
accounting would say that there was never more appropriated than
available.
Number 1165
REPRESENTATIVE JAMES stated that is true. If it made sense, the
$300 million would be swept back into the fund to pay back what has
been borrowed at June 30 of every year, but that's not the way it
works.
Number 1176
REPRESENTATIVE CROFT replied, "Because it doesn't sit in the
general fund."
REPRESENTATIVE JAMES said she understands that.
REPRESENTATIVE CROFT said his point is, the court's decision is a
rationale interpretation of a quickly drafted constitutional
amendment that may not accomplish all that it was intended to.
REPRESENTATIVE JAMES said she agrees with the court's decision.
The constitutional amendment to create the constitutional budget
reserve fund was poorly written.
Number 1193
REPRESENTATIVE JAMES stated, whatever is done for the long-term
planning, the legislature needs to be sure that all of the money is
earning as much as it can. The proper place, it seems, would be to
put the balance in the earnings reserve of the permanent fund, or
under the pile of money that is being managed by the Alaska
Permanent Fund Corporation. Small amounts of money in different
places limits the types of investments that can be made compared to
a larger fund and a larger rate of return. It seems that the state
should "put all its eggs in one basket" in this case.
Number 1258
CHAIRMAN KOTT said "we" certainly want to get the best return for
our investments.
Number 1262
REPRESENTATIVE CROFT suggested a bill to deposit the balance into
the earnings reserve of the permanent fund with a three-quarters
vote. The advantage of that approach is because the constitutional
budget reserve fund would still be alive for money from
settlements. The approach of the constitutional amendment is for
the settlements to go to the general fund because "we" don't expect
the "big whopper settlements"...
Number 1294
REPRESENTATIVE JAMES interjected and stated: "Just the ordinary
course of doing business like a hundred...They're estimating $106
million a year just a--a small percentage of the taxes that we
collect will be administratively appealed. You know, it's just a
part of doing business."
Number 1306
REPRESENTATIVE CROFT asked what would happen to the debt of $3.4 or
$3.8.
CHAIRMAN KOTT replied it would go away. According to Tamara Cook
[Director, Legislative Legal and Research Services, Legislative
Affairs Agency], by creating a new area for this money to be
deposited, the prior debt terminates with the end of the fund.
Number 1331
REPRESENTATIVE CROFT asked whether there is a problem with changing
something that requires a three-quarters vote with a two-thirds
vote. He wondered whether there is a principal based on modifying
a rule with what it takes to effectuate it.
Number 1355
REPRESENTATIVE JAMES replied she doesn't have the answer to that
question. She declared that she hopes to get unanimous
consideration, however.
CHAIRMAN KOTT stated if this went before the voters it would just
require a simple majority of the voters to repeal it.
REPRESENTATIVE MURKOWSKI suggested calling Tamara Cook for an
answer.
Number 1381
REPRESENTATIVE ROKEBERG suggested getting a written legal opinion
for a record to travel with the bill. He thinks the other members
will have the same questions. He declared he intends to be a
cosponsor. He agrees that the use of the constitutional budget
reserve fund is problematic, and this committee needs to look at
where the balance in the fund should be deposited. He shares the
concern regarding the sweep language, which is why the
constitutional amendment needs to be absolutely clear. He also
shares the concern of a greater return on a stand-alone fund, a
smaller corpus, and a shorter time horizon for the utilization of
those funds. Testimony from the Department of Revenue has
indicated that it is much less than expected.
CHAIRMAN KOTT announced that Tamara Cook is online now. He asked
her to comment on the trailing debt that the legislature owes to
the constitutional budget reserve fund.
Number 1465
TAMARA COOK, Director, Legislative Legal and Research Services,
Legislative Affairs Agency, testified via a telephone. She stated
that there is no debt.
CHAIRMAN KOTT stated, so under the termination of the
constitutional budget reserve fund there would be no debt.
MS. COOK replied Article IX, Section 17(d) of the constitution says
that if there is money left in certain places at the end of each
fiscal year, it has to go into the constitutional budget reserve
fund automatically to pay off the debt. But, that subsection would
be repealed.
Number 1490
REPRESENTATIVE CROFT asked Ms. Cook whether repealing the sweep
provision repeals the debt.
MS. COOK replied there is no obligation to repay because subsection
(d) would be repealed.
REPRESENTATIVE CROFT wondered whether there would be a theoretical
debt.
Number 1501
MS. COOK stated it's not even a theoretical debt. The obligation
to repay only exists in subsection (d), and once that is gone there
is no obligation or sweep.
Number 1518
REPRESENTATIVE CROFT asked Ms. Cook whether there is a problem with
the fact that this has a three-quarters vote requirement and with
what is needed to change it. Some rules that establish super
majorities can only be changed by that super majority.
MS. COOK replied no because it amends the constitution. If the
people choose to repeal Section 17, all of it is repealed. It's
the people voting, not a super majority or majority of the
legislature. The only thing the legislature can do is propose the
amendment.
Number 1557
REPRESENTATIVE CROFT asked Ms. Cook whether there is a reason that
this would have to stay in the constitution, or can it drop out
once it does what it was intended to do.
MS. COOK replied it won't drop out on its own. The way it is
written now, it would continue to operate indefinitely.
REPRESENTATIVE CROFT said it would operate as one action. He asked
Ms. Cook whether sunsets are ever placed in the constitution.
MS. COOK replied she can't think of anything like that in the
constitution. There have been provisions that ask for a question
to be placed before the voters on a certain date again, but those
are in the transitional sections.
Number 1599
REPRESENTATIVE CROFT said: "The transitional sections didn't pop
out. There were--are stuff at the end talking about how it's going
to be..."
MS. COOK stated there are a few odd provisional sections that exist
with respect to other constitutional amendments.
Number 1623
CHAIRMAN KOTT asked Ms. Cook to forward a written opinion on the
trailing debt to the committee.
Number 1678
REPRESENTATIVE ROKEBERG stated there are two ways to go - wait and
see if something new results from this legislature, or let the
legislature deposit it at its direction back in the earnings
reserve of the permanent fund. This doesn't have to pass until the
next session because it is a constitutional amendment. He is
concerned that letting the balance in the fund be deposited at the
direction of the legislature the people wouldn't have quite the
faith in it otherwise if they knew exactly where it was going.
Number 1730
CHAIRMAN KOTT stated he realizes that there are other things
occurring outside this room and legislature, but whether or not any
of that comes to fruition remains to be seen. This has a House
Finance Standing Committee referral. He is sure that everything
would be married there, if there is conflict with other issues.
Number 1748
REPRESENTATIVE JAMES said that the public would support putting the
balance in the earnings reserve of the permanent fund. It would
probably be the favorite place.
Number 1766
REPRESENTATIVE ROKEBERG said, by leaving the constitutional budget
reserve fund in place now, that might tend to be looked upon as
favoring one proposal over another. He knows that there is one
proposal that talks about bringing life back into the statutory
budget reserve fund. He also cited the All-Alaskan Plan as an
example.
Number 1806
REPRESENTATIVE CROFT stated the other place that might be the most
popular, from a public perspective, is the principal of the
permanent fund.
Number 1826
REPRESENTATIVE JAMES stated that certainly would encourage the
legislature to make a decision on where to fill the budget gap this
year. She noted, however, that this wouldn't be effective until
after next year's election.
Number 1846
REPRESENTATIVE MURKOWSKI stated, in listening to this discussion,
it seems that this would be more appropriately resolved at the
House Finance Standing Committee level. The House Judiciary
Standing Committee is charged with getting a legal opinion
regarding the deposit of the money. Perhaps, it doesn't need to be
specified where the money would be deposited.
Number 1870
REPRESENTATIVE JAMES said she has had a lot of phone calls
regarding depositing the balance into the statutory budget reserve
fund. It is a term that hasn't been around for a very long time.
She reiterated she choose that fund because it is empty and there
are restrictions, but she would prefer putting it somewhere else
that the people understand a little bit better.
Number 1894
CHAIRMAN KOTT said he is trying to decide which is better - the
earnings reserve of the permanent fund or the corpus of the
permanent fund. There are pros and cons for both. The bill should
leave this committee going into either one. The House Finance
Standing Committee can sort it out based on whatever else it needs
to be married up with it. Nevertheless, it is inappropriate to
leave it go to the statutory budget reserve fund.
REPRESENTATIVE JAMES noted she does not have any objection to that.
Number 1914
REPRESENTATIVE ROKEBERG suggested the committee members consider
the discretion of the legislature at this juncture. That's not
entirely inappropriate, but it's not the most popular politically.
Number 1980
CHAIRMAN KOTT said, if this is the only vehicle that goes forward,
he would like to have some comfort in having set a policy that
would go to the entire House. "We don't know what's going to
happen up in Finance, and you know we got one crack at this. And,
they can undue it up there, untie the knot. But, I'd rather I
think forward something on that's a little more definitive."
Number 2029
REPRESENTATIVE CROFT made a motion to delete the language, "budget
reserve fund established by statute", on page 1, line 11, and to
insert the language, "principal of the permanent fund (art. IX,
sec. 15)". [Amendment 1]
REPRESENTATIVE JAMES AND REPRESENTATIVE ROKEBERG objected.
Number 2080
REPRESENTATIVE JAMES said she's not a financial whiz like some
people, but after thirty years of accounting work she can calculate
figures in her head. She believes, no matter what plan is put on
the table, short of getting more oil down the pipeline or some
other method of meeting the needs of the people that taxes won't
even fill the gap. There is a minimal amount of money available
outside the corpus of the permanent fund for the next...She is
comfortable with putting it into the earnings reserve of the
permanent fund for its maximum return, but she is not comfortable
with putting it off-limits. She didn't support dumping more money
back into the permanent fund last year because of emergencies. She
said, "If we have any kinds of emergencies in our state, which
we're prone to do, we could be in 'deep doo doo' if we don't have
enough money available to make those decisions."
Number 2186
REPRESENTATIVE JAMES further noted that the legislature still plans
to downsize the amount of money being spent. The All-Alaska Plan
suggests reducing spending for another five years. Representative
Rokeberg has a piece of legislation that reduces the percentage of
oil revenues that are put into the corpus of the permanent fund
from 25 percent to what is demanded in the constitution. She
thinks that is wise. The state ought not to put all of the money
out of touch, but there needs to be some kind of control on how to
do the budget, which is a whole different issue. She reiterated
she would like to see some money sitting in the earnings reserve of
the permanent fund for emergencies.
Number 2229
REPRESENTATIVE ROKEBERG suggested the language, "the general funds'
earnings reserve of the permanent fund". It is not an amendment.
He noted that the earnings reserve of the permanent fund are
general funds, except by statute.
Number 2275
REPRESENTATIVE CROFT said this resolution has puzzled him because
the effect of it can be done just by talking and getting
three-quarters votes. Given the dynamics of the makeup of the
legislature, this resolution is a way of not talking to the
minority. The difference is only three votes. It takes 27 votes
to put this on the ballot and 30 votes to just do it. He doesn't
see the point of going around the minority. This could be a
component of a long-range plan. It would probably be the component
that follows almost any plan to get rid of the constitutional
budget reserve fund. Representative Davies has said that some
reformation of this constitutional provision needs to happen, but
this is a way to go around the minority. There has been talk about
changing the vote from a three-quarters to a simple majority. The
minority has been very open and willing to discuss that, but it
hasn't happened. It surprises him because he has worked well with
the sponsor of the resolution on a lot of other issues. If that is
the approach, then let's just put it in the principal where
everybody feels safe.
Number 2397
REPRESENTATIVE JAMES stated she agrees with Representative Croft.
She has never seen the working relationship between the majority
and the minority as good as it is this year. She doesn't blame
that on the majority; it has been the minority who is more willing
to work. The intent of the resolution, however, has nothing to do
with the three-quarters vote; it has to do with the payback. The
payback is a burden on the legislature, and to get a three-quarters
vote to un-sweep the money is absurd. It is important to work
together, but the legislators in the majority and minority might
not be the same next year. The minority might be the majority, and
the majority might be the minority.
TAPE 99-34, SIDE B
Number 0003
REPRESENTATIVE ROKEBERG stated Representative James is right. It
is the payback. In his life, a business agreement/contract is put
together to service the parties to that agreement/contract. The
current system might be considered idyllic, but it has been his
experience to the contrary. He has resented it greatly. There has
been a substantial amount of spending and log rolling. In
understanding the political history of why the two-thirds vote
became three-quarters, this constitutional amendment has been a
disservice to the people. They don't understand it. It's hard
enough for experienced people to understand it. It needs to be
changed. He hopes that something can be done along these lines.
He is confident that there will be a plan to satisfy everybody, and
that this resolution could be part of it. He agrees, with the
sponsor, that clearly the earnings reserve of the permanent fund
would be the most ideal location at this juncture.
Number 0097
REPRESENTATIVE MURKOWSKI asked Representative Croft whether he said
that he could support this if it is part of a bigger plan.
REPRESENTATIVE CROFT replied absolutely. This resolution, however,
is the "cart before the horse." What plan would be implemented by
ending the constitutional budget reserve fund? It seems that the
only change is from a three-quarters vote to a simple majority,
which is only a power deal. He is also worried that the opposite
is true. In other words, it would become an obligation to keep a
balance of that $3 billion. It would be disingenuous to pass the
resolution then spend it down twice.
Number 0193
REPRESENTATIVE CROFT further stated, in response to Representative
Rokeberg's last comment, he doesn't think that the constitutional
budget reserve fund has been negative for the people. It is the
time when legislators are consulted. "Obviously, it depends on
whose ox is being gored whether it's good government or log rolling
or some combination. But, this can and probably has to be an
important component of what we do, but asking us to vote to do it
before we know what we're doing is too much."
Number 0232
CHAIRMAN KOTT announced for the record that all the committee
members are present.
CHAIRMAN KOTT called for a roll call vote. Representatives Green,
James, Rokeberg, Murkowski and Kott voted against the motion.
Representatives Croft and Kerttula voted in favor of the motion.
The motion failed by a vote of 5 to 2.
Number 0289
REPRESENTATIVE ROKEBERG asked Representative James whether she
prefers an amendment including the words "general fund" or
"earnings reserve of the permanent fund."
Number 0302
REPRESENTATIVE JAMES replied she would like to have the money
deposited into the permanent fund. She would like to change it
before going to the House Finance Standing Committee, even though
it might change as part of an overall plan. It might not even pass
this year, but she has the entire interim to talk to folks about
it. She would prefer that it didn't go into the statutory budget
reserve fund. She reiterated any place else is fine with her,
except for putting it into the corpus of the permanent fund or
leaving it to the discretion of the legislature.
Number 0349
REPRESENTATIVE ROKEBERG made a conceptual amendment to read,
"general funds' earnings reserve of the permanent fund", after the
word "the" on page 1, line 11. The idea is to tell the public that
the earnings reserve of the permanent fund is part of the general
fund.
Number 0380
REPRESENTATIVE KERTTULA noted it would be better to leave that for
the language in the explanation. The earnings reserve of the
permanent fund really isn't part of the general fund.
REPRESENTATIVE ROKEBERG said it is part of the general fund. It
says so in the constitution. It has just been statutorily
redefined. That's what has caused so much confusion. The people
do not understand that the earnings reserve of the permanent fund
is part of the general fund. As long as it is going into the
earnings reserve, the people need to understand that it is
available for appropriation.
CHAIRMAN KOTT noted it is available for appropriation.
Number 0418
REPRESENTATIVE MURKOWSKI asked whether that should be included in
the constitutional amendment or as part of the explanation.
REPRESENTATIVE ROKEBERG stated the only trouble is the people don't
know that...
REPRESENTATIVE MURKOWSKI asked whether it's the job of the
legislature to educate them.
REPRESENTATIVE ROKEBERG replied it is the job of the legislature to
educate them, but maybe not in this constitutional amendment. He
reiterated it was just a suggestion and deferred to the sponsor on
whether or not she wants to use the language, "general fund."
Number 0444
REPRESENTATIVE JAMES said, she thinks, it opens the door for
confusion. It would be better to simply have the language,
"earnings reserve of the permanent fund." She agrees that the
money is available for appropriations and the people ought to know
that, but technically it's not general fund money because it has
been statutorily changed to include money that is available for
appropriation within the permanent fund.
Number 0464
REPRESENTATIVE ROKEBERG withdrew his conceptual amendment.
Number 0473
REPRESENTATIVE ROKEBERG made a motion to insert the language,
"earnings reserve of the permanent fund", after the word "the" on
page 1, line 11.
REPRESENTATIVE CROFT asked whether, "earnings reserve of the
permanent fund", is defined anywhere.
REPRESENTATIVE ROKEBERG replied it is in statute.
REPRESENTATIVE JAMES noted that a change would have to be made to
the title too.
REPRESENTATIVE CROFT asked where is it in statute.
REPRESENTATIVE ROKEBERG noted that he has been reading the
constitution lately and it doesn't mention the earnings reserve of
the permanent fund.
REPRESENTATIVE CROFT said he has looked at the permanent fund
corporation section and he can't find any mention to the earnings
reserve.
Number 0526
CHAIRMAN KOTT called for a brief at-ease at 2:15 p.m. and called
the meeting back to order at 2:18 p.m.
Number 0531
REPRESENTATIVE ROKEBERG made a motion to include the language,
"earnings reserve account as established by statute in the
permanent fund", after the word "the" on page 1, line 11; as well
as the technical change to the title. There being no objection, it
was so moved.
Number 0565
REPRESENTATIVE ROKEBERG made a motion to move HJR 30, as amended,
from the committee with individual recommendations and the attached
fiscal note(s). There being no objection, CSHJR 30(JUD) was so
moved from the House Judiciary Standing Committee.
HB 146 - LIABILITY FOR COMMERCIAL REC ACTIVITIES
CHAIRMAN KOTT announced the next order of business is HB 146, "An
Act relating to civil liability for commercial recreational
activities; and providing for an effective date."
CHAIRMAN KOTT indicated that CSHB 146(L&C) [1-LS0701\D] is before
the committee and called on Ms. Kelly Sullivan to present the
sponsor statement.
Number 0618
KELLY SULLIVAN, Legislative Secretary for Representative Pete Kott,
Alaska State Legislature, came before the committee and presented
the sponsor statement. In Alaska, a lot of recreational activities
are offered for tourists as well as locals. She cited sport
fishing, hunting, and hiking as examples. The bill establishes the
responsibilities of the commercial recreational businesses, as well
as the responsibilities of those who choose to participate in such
activities. The bill addresses the specific guidelines that
operators and participants need to follow to minimize the
possibilities of accidents, and should an accident occur it helps
to define who is to be held liable. The bill helps to avoid the
unfair and unreasonable claims hurting the small operators in
Alaska which are making it difficult for them to stay in business.
Number 0720
CHAIRMAN KOTT stated this is the third time a bill like this has
tried to make it through the legislature. A similar bill has
passed the House before, but met its fate in the Senate Judiciary
Standing Committee. He noted that this bill has been worked over.
It clearly defines responsibilities for both the operators and
those who seek to participate in various commercial recreational
activities.
CHAIRMAN KOTT opened the meeting up to public testimony.
Number 0760
MIKE WINDRED, Vice President, Marketing and Sales, Alaska Travel
Adventures, came before the committee to testify in support of HB
146. This bill has come up three different times in recent years
because of the support from the recreational providers. At
present, there is industry-wide support. He cited the Alaska
Visitors Association and the Alaska Wilderness Recreation and
Tourism Association as examples of organizations that support this
bill, which totals 95 percent of the recreational providers. There
is very good backing behind the bill, and it is well written.
MR. WINDRED further stated that the basic premise is for the
participants to assume some inherent risks and for the operators to
perform a better standard that is not required today. In other
words, an operator would have to explain to the participants the
inherent risks for a particular activity. In addition, the
operator would also need to train its employees in CPR
[cardiopulmonary resuscitation] and first aid, use maintained
equipment only, and act in a reasonably safe and competent manner.
This has been decided in litigation, but setting it forth in
legislation makes it more defined and simple. He believes the bill
would help his company and many other businesses like it by
reducing nuisance suits that are presently settled out of court.
Alaska Travel Adventures has a fairly large deductible that seems
to rise as there are more and more small suits. He explained a
small suit is typically a customer who trips or falls out of a raft
or does something that could have been completely caused by their
own actions and not by fault of the operator. An attorney will
typically determine the deductible, which usually ends up being the
amount that the case is settled for. This bill would definitely
put money back into his pocket for those types of "frivolous"
lawsuits. It would also ultimately reduce the insurance rates.
MR. WINDRED further stated, in response to the position paper from
the Alaska Action Trust [dated April 12, 1999], it doesn't surprise
him that they have come out against this legislation because it
would take money out of trial lawyers' pockets. It would not
inhibit litigation if a consumer wants to sue. The large cases
would go to court. In further response, the purpose of the bill is
covered in statute, but not enough. It would help fight the
nuisance claims before going to litigation thereby reducing claims.
In further response, this legislation would not be contradictory to
ski areas already in statute. In further response, several small
businesses have been closed because of these claims. He cited a
small rafting operation in the North and Southeast that have been
closed because the profits were lower than the risks - the
deductible. In further response, no operator would market
contributory negligence. It wouldn't be a stigma for Alaska. It
hasn't stopped anybody from traveling to Mexico or Europe where a
person wouldn't even think of entering into a lawsuit if that
person was hurt there. In further response, the responsibilities
of participants need to be in the bill to make it strong. In
further response, if an operated used faulty equipment or failed to
explain the inherent risks, that operator would be apt to lose in
a litigation at that point.
Number 1203
REPRESENTATIVE GREEN asked Mr. Windred whether this would be any
kind of hardship for an operator.
MR. WINDRED replied he doesn't think so. If anything, it would be
good for the industry. It would hold it to a higher standard,
which could be used to make tourists feel safer.
Number 1241
REPRESENTATIVE CROFT stated the ski liability statute sets the
consequences for both operators and participants. This bill
doesn't say what would happen if an operator doesn't "do it." In
comparison to the ski statute, a ski operator or other person who
violates a requirement of the chapter is negligent and civilly
liable to the extend a violation causes injury to a person or
damage to property. He asked Mr. Windred whether he has any
objection to including that language.
MR. WINDRED replied he is not familiar with the ski area statute,
other than it is specific to an activity. The idea is to bring all
the different types of commercial recreational activities under one
bill.
Number 1349
REPRESENTATIVE CROFT said it is a legitimate concern. The language
in the bill is more broad. The responsibilities of operators of
commercial recreational activities are broad as well. He asked Mr.
Windred whether there can be duties and consequences for both
parties.
MR. WINDRED replied, as an operator, he doesn't see why not.
Number 1431
REPRESENTATIVE MURKOWSKI asked Mr. Windred what his company has
paid on average for nuisance suits.
MR. WINDRED replied Alaska Outdoor Adventures sees between $10,000
and $25,000 a year in nuisance suits. That can be from either one
case or several small cases. He cited the suits are from
stumbling, falling off a chair, or something that an operator could
not have prevented. In most of those cases, his company ends up
paying the bills. He doesn't have a problem with that; he has a
problem with the "pain and suffering" suits.
Number 1544
REPRESENTATIVE MURKOWSKI asked Mr. Windred whether the majority of
the frivolous suits are settled prior to litigation within the
courts.
MR. WINDRED replied correct.
Number 1564
REPRESENTATIVE KERTTULA asked Mr. Windred whether he actually has
had somebody sue his company for stumbling over a rock.
MR. WINDRED replied yes.
REPRESENTATIVE KERTTULA asked Mr. Windred what happened with the
case.
MR. WINDRED replied the process is either the attorney or client
will contact his company directly and ask for the insurance
company. He usually responds to them directly. At the point the
dollar figure is determined, his company either decides to turn it
over to the insurance company or decides to fight it.
Number 1608
REPRESENTATIVE KERTTULA asked Mr. Windred whether his company
settled that case or just moved to dismiss it.
MR. WINDRED replied in most of those types of cases his company
ends up paying for the hospital fees, transportation fees and
damages to any equipment, such as a camera. The case is usually
settled for a couple hundred dollars or so more, which is well
worth it compared to going to litigation. Nevertheless, it is
generous considering that they stumbled over their own feet.
Number 1680
REPRESENTATIVE ROKEBERG asked whether anybody knows who is the
Alaska Action Trust.
REPRESENTATIVE MURKOWSKI replied Jan Bouch is the executive
director of the Academy of Trial Lawyers Association. Her guess is
that Alaska Action Trust is a lobbying arm of that association.
Number 1780
REPRESENTATIVE ROKEBERG said he is concerned about who is defining
the "inherent risk of commercial recreational activity." In other
words, how would an operator explain to a participant the inherent
risks of a particular activity? Every activity has a different
type of risk.
Number 1798
MR. WINDRED replied his staff is trained in the safety requirements
for each activity. They are different for each activity, but it
falls upon an operator to determine what are the standard inherent
risks. That is pretty standard for the industry as it sits now.
Number 1869
REPRESENTATIVE ROKEBERG said if a person is going bungee jumping
that person should probably sign a release. He asked Mr. Windred
whether that is the direction the bill is going.
MR. WINDRED replied if an operator doesn't have a signed release
for bungee jumping that operator is looking for trouble. There are
some areas where signed releases work well. There are some areas
where requiring a signed release does not work well. He cited his
salmon bake where several hundred people attend a day and Binkley's
river tour in Fairbanks as examples. The tour in Fairbanks still
has to follow coast guard protocol in terms of orienting
passengers to the safety aids.
Number 1949
REPRESENTATIVE ROKEBERG noted that the bill is restricted to
commercial outdoor activities when there are two new ice rinks
being developed in Anchorage that probably will have some sort of
outdoor rink adjacent to them. He is concerned about the rink
rats.
Number 2004
REPRESENTATIVE KERTTULA asked Mr. Windred whether he would include
his salmon bake in the definition of "recreational activity."
MR. WINDRED replied he would include it because it is sold as a
tour; it is not sold as a restaurant.
Number 2041
REPRESENTATIVE JAMES stated she is pleased to see this type of
legislation. In her lifetime, she can remember when there wasn't
insurance, there weren't so many trial lawyers, and when a person
fell down and hurt himself it was his own fault. She is not saying
that, if somebody gets hurt at somebody else's expense, that person
should get off free. She doesn't care if other legislation comes
around for each type of commercial activity because the litigious
side of this issue is chilling for people willing to invest money
for recreational activities, even when it creates jobs because the
inherent liability is so overwhelming.
Number 2248
CHAIRMAN KOTT stated that the inherent risk in downhill skiing is
different than other outdoor recreational activities such as bird
watching. He mentioned the types of risks associated with downhill
skiing such as a broken bone.
Number 2340
BOB ENGELBRECHT, Owner, North Star Trekking, came before the
committee to testify in favor of HB 146. He is also on the board
of directors for the Alaska Visitors Association. He has been in
the tourism industry in Alaska for about 16 years, primarily in the
adventure side of it. Tourism in Alaska has been evolving and
changing over the past few years. It's not just tourists arriving
on cruise ships, but more and more people are wanting to experience
Alaska in the back country. In most cases, they don't have an
appreciation of what they are getting into.
TAPE 99-35, SIDE A
Number 0001
MR. ENGELBRECHT continued. He runs a tour of taking people on the
Mendenhall Glacier. The inherent risk of that tour is walking on
the ice. There is no way around it. His insurance broker wanted
to put AstroTurf on the glacier where the people walk around. The
point of the bill is to not absolve operators of negligence or to
put the participants in an activity in an unrealistic position so
that they aren't covered by insurance. The point of the bill is to
make sure that the participants are aware of what they are getting
into, and to make sure the operators are using good equipment, etc.
And, if there is a health or physical ability issue, to find out
about it before hand and to decide to opt out of a particular
physical activity. At least people would go into an activity with
their eyes open and knowing what they are doing.
MR. ENGELBRECHT further stated, in reference to the ski area
statute, it is a very specific activity in a confined area. This
bill talks about a variety of activities in large areas where all
different kinds of conditions exist. He has a permit for the
Juneau Ice Field which is 1,500 square miles. He runs into all
kinds of different conditions. While the idea is similar in terms
of taking on an inherent risk, the other recreational activities
are more diverse and the infrastructure is not in place, just the
natural environment.
MR. ENGELBRECHT further stated that he informs clients in a number
of ways about the risks. They are given a briefing to make sure
that they understand what they are getting into. A surprising
number of people do not have a clue about what they are getting
into. Most say, "Well, it's not what I thought I was going , but
I want it anyway." They make that choice to go ahead. Once on
the glacier, the guides will give a thorough briefing on the
equipment, the area, and the inherent risks involved, and what they
need to cooperate based on the conditions.
Number 0379
CHAIRMAN KOTT asked Mr. Engelbrecht to comment on the concern of a
lack of consequence of an operator that does not provide the
requirements of the bill.
MR. ENGELBRECHT replied for the most part this bill is aimed at the
more frivolous suits or claims. The bill says the inherent risks
are those that are apparent to an ordinarily prudent person. There
is nothing in the bill that would prevent litigation or an operator
being taken to court. If an operator has done an inadequate job,
it would come out in court.
Number 0482
REPRESENTATIVE MURKOWSKI referred to page 2, line 2, of the bill -
"Contributory negligence" - and commented on getting hit in the
head with a paddle while white water rafting causing a concussion.
The other inherent risks had been discussed, such as falling out of
the raft, hypothermia, etc. She is concerned because all of the
inherent risks cannot be defined. She wondered how the bill can be
as broad by accepting the inherent risks of all these types of
commercial outdoor activities.
Number 0621
MR. ENGELBRECHT stated, not being an attorney, he doesn't have a
great response. The general point is, it is difficult to define
all the inherent risks. If a person is hiking and a limb falls
from a tree and hits that person, was that an inherent risk the
person was made aware of? It was an act of God. Was there
anything that the operator could have done? Was the operator
responsible? It's a gray area, and if it's a significant issue it
probably would go to court.
Number 0714
REPRESENTATIVE MURKOWSKI asked Mr. Engelbrecht how many nuisance
claims does his business average annually.
MR. ENGELBRECHT replied he just started his company last year. He
has one season under his belt. He had one minor injury from a
person tripping over his crampons and fell. Prior to starting his
company, he worked for 18 years with a larger company that carried
between 30,000 to 40,000 people onto the glacier. Out of that
number, there might have been a dozen slips, falls, and bruises.
The most serious injury would have been a broken wrist from
tripping and breaking a fall. He can only think of one that went
to litigation. The rest were settled by the insurance companies.
It's easier to give away a deductible than to spend tens of
thousands of dollars in litigation. He knows of one case that
settled for a couple hundred thousand dollars for tripping over his
own two feet. These claims come back to the operator. Very few go
to trial, but a lot of them happen and a lot of them get settled by
insurance companies every year.
Number 0848
CHAIRMAN KOTT asked Mr. Engelbrecht whether it's true that there
are industry standards that are accepted and considered inherent
risks, and anything beyond that is in the gray area.
MR. ENGELBRECHT replied, for the most part, it is fairly obvious if
somebody is not following prudent industry standards for the type
of activity going on. He doesn't see this bill as having any
effect on the other things that could happen such as negligence.
That's a whole different realm.
Number 0956
REPRESENTATIVE KERTTULA said Mr. Engelbrecht's company is not part
of the problem; it's willing to live up to the standards. She
asked Mr. Engelbrecht whether he has a problem with an operator
facing regular court liability for not living up to the standards
and not being able to claim the shield that the bill provides.
MR. ENGELBRECHT replied, not being an attorney, he's not sure how
he can technically answer the question. Practically, if somebody
gets hurt on a trail and bleeds to death and the guide didn't have
basic first aid training, it's obvious that there is some
negligence. At that point, the operator is not shielded by this
bill. The bill actually provides an extra tool for somebody who
has been hurt if an operator doesn't follow good prudent standards.
But, if an operator is doing everything reasonable that it can, and
the experience is inherently in a natural environment that hasn't
been sanitized and safety-proofed...He continued by stating that he
could put a guard railing and AstroTurf on the glacier and no one
would slip and fall, but it would be a pretty lousy experience.
REPRESENTATIVE CROFT asked Mr. Engelbrecht for a brochure.
MR. ENGELBRECHT gave Representative Croft a brochure. He noted
that in the brochure there is a list of equipment given for safety.
He cited ice axes, crampons, and safety harnesses as examples.
Number 1136
CHAIRMAN KOTT closed the meeting to public testimony.
Number 1146
REPRESENTATIVE CROFT stated it is appropriate in ski areas and in
general to define the inherent risks of the participants and the
fundamental responsibilities of the operators. The bill says
clearly, that if a participant doesn't meet his or her
responsibilities, it "is" a contributory negligence. He has an
amendment using the exact language from the ski area statute that
puts everything on an even keel for both the operator and
participant.
Number 1227
REPRESENTATIVE CROFT made a motion to adopt Amendment 1. It reads
as follows:
Page 3, line 9
Insert
Sec. 05.50.060. "A person who operates a business that
offers a commercial recreational activity and violates a
requirement of this chapter is negligent and civilly
liable to the extent the violation causes injury to a
person or damage to property."
CHAIRMAN KOTT objected. He called on Mr. Mike Ford, drafter of the
bill, and asked him whether there are others in statute that are
narrowly constructed like the ski statute.
Number 1265
MIKE FORD, Attorney, Legislative Legal Counsel, Legislative Legal
and Research Services, Legislative Affairs Agency, came before the
committee to answer questions. The ski area statute is the only
one of its kind. There are other statutes that deal with
recreational activities, but they mostly refer to licensing and
safety requirements. He cited boating as an example. The ski area
statute deals with a very specific activity, while this bill deals
with commercial recreational activities that could include a number
of different things.
Number 1318
REPRESENTATIVE ROKEBERG said he is concerned about aviation
activities. He asked Mr. Ford whether the bill includes the use of
aircrafts.
MR. FORD replied it would cover an aviation club that took people
up as a business. It meets the definitions of "commercial
recreational activity" and "recreational activity" in the bill.
Number 1360
REPRESENTATIVE ROKEBERG said he finds that troubling.
REPRESENTATIVE CROFT asked Representative Rokeberg whether he wants
to exempt them.
REPRESENTATIVE ROKEBERG replied, "I think so."
REPRESENTATIVE CROFT suggested that Representative Rokeberg write
up some language.
REPRESENTATIVE ROKEBERG further stated he is also concerned about
the outdoor rink rats.
REPRESENTATIVE MURKOWSKI stated, "Don't forget those rock climbing
walls." Most of them are indoor.
Number 1388
MR. FORD pointed out there was legislation that dealt with
skateboarding rinks and municipalities that operate them last year
as an example of another activity that was thought to need
protection.
REPRESENTATIVE ROKEBERG asked Mr. Ford whether the bill passed.
MR. FORD replied, he believes, it passed the House.
REPRESENTATIVE ROKEBERG asked Mr. Ford whether this bill would deal
with skateboarding as well.
MR. FORD replied only if it's an outdoor activity.
CHAIRMAN KOTT noted only if it's a commercial outdoor activity.
MR. FORD noted that the bill last year targeted indoor facilities.
But, an outdoor facility might fit the definitions, if it's
commercial.
Number 1446
REPRESENTATIVE MURKOWSKI asked Mr. Ford whether he has seen
Representative Croft's amendment.
MR. FORD replied no.
Number 1470
CHAIRMAN KOTT called for an at-ease at 3:15 p.m. and called the
meeting back to order at 3:20 p.m.
Number 1476
CHAIRMAN KOTT withdrew his objection. There being no further
objection, Amendment 1 was so adopted.
Number 1487
REPRESENTATIVE CROFT said, in regards to aviation activities, an
argument could go either way. There should be a standard care for
persons jumping out of an aircraft. There could be advantages to
the operators being in, but all of the implications haven't been
thought through since it wasn't foremost on everybody's mind when
drafting the bill.
Number 1549
CHAIRMAN KOTT asked Mr. Ford whether flight seeing is part of the
bill.
MR. FORD replied he doesn't see a reason to exclude flight seeing
from the application of the bill. He doesn't see how it could be
argued that they are not included because everyone understands that
people fly for recreation. He can go to the Juneau International
Airport where there is a flight service to learn how to fly which
costs money. It certainly is a commercial and recreational
activity, and somebody who suffers harm would be included.
Number 1591
CHAIRMAN KOTT asked Mr. Ford whether there is a difference between
the inherent risks and negligence for aviation activities.
MR. FORD replied the inherent risks change for each activity.
Certainly, getting into an airplane is different than getting into
a raft or going to a salmon bake.
Number 1621
CHAIRMAN KOTT stated the only other issue is the definition of the
term "recreational activity." He asked Mr. Engelbrecht, as a
representative of the industry, whether there is any merit in
including indoor activities. He cited indoor ice skating rinks and
climbing walls as examples.
Number 1655
MR. ENGELBRECHT replied the climbing wall is the immediate thing
that comes to his mind. He noted that the environment is
controlled more for indoor activities compared to the unimproved
outdoor type of activities.
Number 1690
CHAIRMAN KOTT said he was thinking along those lines as well. The
definition provides for a hobby which could be a whole host of
things such as painting. It's a whole new "ball of wax" that he's
not willing to get into.
Number 1729
REPRESENTATIVE CROFT made a motion to move CSHB 146(L&C), as
amended, from the committee with individual recommendations and the
attached fiscal note(s). There being no objection, CSHB 146(JUD)
was so moved from the House Judiciary Standing Committee.
CHAIRMAN KOTT opened the meeting to public testimony again to
accommodate a witness he overlooked.
Number 1822
RUSSELL L. WINNER, Alaska Academy of Trial Lawyers, testified via
teleconference from Anchorage. The academy is the lobbying arm of
the Alaska Action Trust. He wrote the position paper for the
trust. In his twenty years of practice, he hasn't had one case
that dealt with this issue. It's an area that is not heavily
litigated. The trial lawyers are not interested in this bill to
line their pockets, but instead to ensure that people who are
insurable are (indisc.). And, if they are, then they should
receive a fair compensation. The bill raises more legal questions
than answers. Who defines inherent risk? He replied, the
operators or the courts. How is it defined? If it's defined
specifically, what if an injury is different? If it's defined in
general terms, is it feasible and valid? If the inherent risk of
white water rafting is drowning, then just about anybody who falls
in the water and drowns without cause would be subject to (indisc.)
inherent risk. He's not sure that is the intent, but a general
definition might fall into that category. The same is true for air
taxis. An inherent risk of flying in an air taxi is crashing. Is
the net effect of the legislation to exempt air taxis from
liability when a pilot flies into a mountain or is negligent for
not avoiding bad weather, for example. The bill says that
participating in a commercial recreational activity a person is
contributorily negligent. He wonders whether that is a wise way to
promote outdoor recreational activities for the state. He also
wonders whether any other state has enacted a bill like this.
Information like this can be widely spread to the public. It might
be counterproductive to the industry. If a bill was placed before
the committee exempting law suits in other areas, the testimony
would be similar. He cited car rental agencies as an example. The
common law in Alaska has been developed by the courts and juries
articulating liability and responsibilities. It has worked well
and if the legislature starts to enact this type of reform there
will be a piecemeal and confusing process. It is better to trust
juries with these matters based on general principles of the common
law than to try to articulate the specific rules for each industry
in the state.
Number 2088
REPRESENTATIVE CROFT asked Mr. Winner whether, even with the
amendment, he thinks that the bill should not pass.
MR. WINNER replied he hasn't seen the amendment, but from what he
gathered listening to the conversation it is an improvement. He
still thinks that this is (indisc.) legislation. It opens the door
to other groups to come forward and ask for immunity. He
reiterated that the common law system and juries are better able to
decide on a case-by-case basis. This legislation asks whether or
not to stay with a common law system or to move towards a common
(indisc.) of the laws of tort. He thinks that the state should
stay on the common law side of that line.
HB 85 - TEACHERS' LICENSES, DISCIPLINE & ETHICS
CHAIRMAN KOTT announced the next order of business is HB 85, "An
Act relating to licensure and professional discipline of members of
the teaching profession and providing for related penalties;
relating to grounds for dismissal of a teacher; relating to the
Professional Teaching Practices Commission; relating to limited
immunity for procedures under the Educator Ethics Act; making
conforming amendments; and providing for an effective date."
Number 2166
SANNA GREEN, Executive Director, Professional Teaching Practices
Commission, Department of Education, testified via teleconference
from Anchorage in support of the bill. The bill was proposed
because the procedures, regulations and statutes need to be
upgraded. She announced there is an amendment to clarify the
language more. She also announced that Teresa Williams from the
Department of Law is here to explain the bill.
Number 2220
TERESA WILLIAMS, Assistant Attorney General, Fair Business
Practices Section, Civil Division, Department of Law, testified via
teleconference from Anchorage. She referred to a side-by-side
analysis of the bill dated April 16, 1999 with two attachments -
Version "A" and "B". She explained Version "B". She referred to
Section 1 and noted that the term "teacher certificate" is being
changed throughout the bill. She referred to Section 2 and noted
that it alternatively provides an opportunity to take an
examination in lieu of taking classes on cross-cultural
communication. It was pointed out that many applicants have
sufficient enough knowledge to teach a course on cross-cultural
communication and they shouldn't be required to take one. She
referred to Section 3 and noted that it is new requiring a criminal
history background check. It strengthens the existing law and
allows for information from a background check to be disclosed if
a person has been found not guilty by reason of insanity. The
purpose of a background check is for that information to go to the
Professional Teaching Practices Commission so that it can inquire
further as to whether or not such a conviction is grounds for
denial. The amendment spells out the circumstances for checking
a license renewal based on (indisc.) from the Alaska Association of
School Administrators. There is a feeling that this would be
helpful in knowing that all staff has had a criminal background
check. Alaska used to be a dumping ground for teachers who were
fleeing from other jurisdictions or who had problems in other
jurisdictions. Once the finger printing requirement went into
place that stopped. She referred to Section 4 and noted that,
currently, there are no grounds for denial of a license. The
section pulls together the...
TAPE 99-35, SIDE B
Number 0001
MS. WILLIAMS continued. She referred to subsection (b) and noted
that it sets the preventative grounds for denying a license. The
department can suspend processing an application if the applicant
has an unresolved criminal or discipline proceeding related to
licensing.
Number 0063
REPRESENTATIVE CROFT said he is concerned that Alaska used to be a
dumping ground for teachers who have committed crimes elsewhere.
He asked Ms. Williams whether the finger printing part has been
tightened up.
MS. WILLIAMS replied the finger printing requirement was put in
regulation by the Department of Education, but it was only for new
applicants. This bill makes it stronger in the event of a
challenge. It requires people coming in for renewal to be finger
printed at which time a criminal background check is done.
Number 0126
MS. WILLIAMS further explained Version "B." It allows for the
Department of Education to issue a conditional license and requires
steps to be taken appropriate for those circumstances. She cited
a person with a drinking problem as an example. Currently, if a
person is denied a license there are no provisions to deal with the
next step. This provision spells out the process after a denial
and provides for an appeal to the Educators Ethics Commission and
on to superior court from there. This provision also codifies the
current reporting to any national clearinghouse that maintains
records of professional discipline. She referred to Section 5 and
noted that it makes the Administrative Procedure Act applicable to
the tribunal's denial decision. She referred to Section 6 and
noted that it amends the basis for disciplining employees to mirror
the reasons for discipline by the commission. It simply
cross-references them, which is important because sometimes one
changes and the other doesn't. It's important to keep them
mirrored.
Number 0265
CHAIRMAN KOTT asked Ms. Williams whether she is referring to AS
14.20.375.
MS. WILLIAMS replied she is referring to AS 14.20.170 which
cross-references AS 14.20.372 - "Grounds for discipline."
Number 0425
CHAIRMAN KOTT asked Ms. Williams what would be a reason why the
Educators Ethics Commission would not take disciplinary action for
the reasons numerically listed in the bill. They seem to be
serious issues, but the language reads "may."
Number 0447
MS. WILLIAMS replied it might be a "may" rather than a "shall" when
the commission's resources are such that the most important cases
have to be picked. In addition, competency requires a level of
discretion for the commission to step in and begin a proceeding.
Number 0494
MS. GREEN referred to number (5) and noted that there have been
many cases on the omission of material when applying for
employment. This is a way to apply judgement on the provisions in
the bill, especially (5), (6) and (7).
Number 0518
MS. WILLIAMS noted, in reference to competency, the department
likes for the school district to take the lead. They generally
tend to be fact-specific cases requiring a lot of foot work.
Number 0535
MS. WILLIAMS continued explaining Version "B." She referred to
Section 14.20.375 and noted that it expands and compiles the
disciplinary actions imposed by the Department of Education. She
noted that many of the changes come from the licensing statute.
Subsection (c) says a person may not surrender a license without
approval of the commission. A lot of people who are facing serious
discipline think that surrendering a license avoids a record on the
basis of that action. Subsection (d) says that the commission may
suspend a license on grounds of immediate danger to public health.
Subsection (e) says that the commission is not bound by a school
district's decision. It benefits a teacher by not having to defend
himself in two proceedings. It benefits the commission by having
school districts do their homework.
Number 0655
MS. GREEN noted that this is the current practice now. It is just
being put in statute.
MS. WILLIAMS continued explaining Version "B." She referred to
subsection (f) and noted that it has been moved from a different
section. Subsection (g) has been moved and allows for a civil fine
to be assessed against a member of the teaching profession who is
not required to be licensed for ethical violations. Subsection (h)
codifies the reporting requirements to any national clearinghouse.
Subsection (i) is new and precludes a person from employment in the
teaching profession, even if a license is not required, if that
person's license has been suspended or revoked.
Number 0706
REPRESENTATIVE CROFT stated the original version of the bill was
noncontroversial. In the interest of time, he asked Ms. Williams
whether the Department of Law and the Professional Teaching
Practices Commission like the amendment.
MS. WILLIAMS replied the Professional Teaching Practices Commission
has gone over the changes and has approved them. The Department of
Law made some of the changes in the amendment.
REPRESENTATIVE CROFT said he appreciates the side-by-side analysis
that she has provided. It's not necessary to go through the rest
of it, except for the fundamental changes.
MS. WILLIAMS noted that there are changes to the limitations on
reinstatement after a suspension or revocation. Currently, a
person can reapply after one year. This places a procedure for
reinstatement. Another change is the penalty for fraudulently
teaching under a forged certificate. Currently, there is no
specific provision on how to deal with that, and remarkably there
have been two cases in the last year.
Number 0820
CHAIRMAN KOTT noted his appreciation of the side-by-side analysis
that she provided to the committee members.
Number 0839
REPRESENTATIVE KERTTULA made a motion to adopt Amendment 1. There
being no objection, it was so adopted. It reads as follows:
Page 2, line 9:
Delete "the reports"
Insert "a report that indicates grounds for denial of a
license under AS 14.20.029"
Page 2, lines 9-10:
Delete "this chapter"
Insert "AS 14.20.029"
Page 2, line 12, following "has":
Insert "received and"
Page 2, lines 12-13:
Delete "received under this section and has determined
the applicant's suitability for licensing under this
chapter"
Insert "under this subsection"
Page 2, lines 17-18:
Delete "the department, by regulation, requires a
criminal history background check before a license may be
renewed"
Insert:
(1) a criminal history background check has not been
previously conducted on the licensee:
(2) the licensee was not employed in a position
requiring a license for the entire duration of the
previous license period; or
(3) the licensee has resided out of state for a
portion of the previous license period
Page 2, line 27:
Delete "has been"
Insert "is"
Page 3, line 2, following "investigation"
Insert "for an allegation suggesting unfitness to teach"
Page 3, line 6, following "jurisdiction":
Insert "for reasons that would be grounds for denial
under AS 14.20.029"
Page 3, lines 15-16:
Delete "this chapter"
Insert "AS 14.20.029"
Page 3, line 17:
Delete "complaint, review procedure, or"
Page 3, line 18, following "agency"
Insert "on grounds that relate to suitability for
licensing under AS 14.20.029"
Page 3, lines 29-30:
Delete "are otherwise in the best interests of the
public"
Insert "will otherwise protect the physical and mental
well-being of students"
Page 5, lines 17-18:
Delete "as defined by the commission in regulation"
Page 7, line 6, following "chapter":
Insert "and the commission finds grounds for discipline
under AS 14.20.372"
Page 7, line 7:
Delete "if the commission finds grounds for discipline
under AS 14.20.372"
Insert "as appropriate to the finding of grounds for
discipline"
Page 8, line 18:
Insert a new subsection to read:
(e) The commission shall stay a hearing on an
accusation under this section if the teacher has requested a
hearing before the school board or invoked grievance
procedures.
Number 0849
REPRESENTATIVE JAMES made a motion to move HB 85, as amended, from
the committee with individual recommendations and the attached
fiscal note(s). There being no objection, CSHB 85(JUD) was so
moved from the House Judiciary Standing Committee.
ADJOURNMENT
CHAIRMAN KOTT adjourned the House Judiciary Standing Committee
meeting at 4:05 p.m.
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