Legislature(1993 - 1994)

03/04/1993 03:00 PM House L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
               HOUSE LABOR AND COMMERCE COMMITTEE                              
                       STANDING COMMITTEE                                      
                          March 4, 1993                                        
                            3:00 p.m.                                          
  MEMBERS PRESENT                                                              
  Rep. Bill Hudson, Chairman                                                   
  Rep. Joe Green, Vice Chairman                                                
  Rep. Joe Sitton                                                              
  Rep. Brian Porter                                                            
  Rep. Eldon Mulder                                                            
  MEMBERS ABSENT                                                               
  Rep. Jerry Mackie                                                            
  Rep. Bill Williams                                                           
  COMMITTEE CALENDAR                                                           
  *HB 113:  "An Act regulating the solicitation of                             
            contributions by charitable organizations and paid                 
            solicitors and the solicitation of sales by                        
            telephonic means; and amending Alaska Rules of                     
            Civil Procedure 79 and 82."                                        
            MOVED FROM COMMITTEE                                               
  *HB 158:  "An Act making appropriations for contract                         
            settlement costs and cost-of-living adjustments                    
            for public employees who are members of certain                    
            collective bargaining units; and providing for an                  
            effective date."                                                   
            MOVED FROM COMMITTEE                                               
  (* First public hearing.)                                                    
  WITNESS REGISTER                                                             
  REP. RON LARSON                                                              
  Alaska State Legislature                                                     
  State Capitol                                                                
  Juneau, Alaska 99801-1182                                                    
  Position Statement:  Prime Sponsor of HB 113                                 
  JIM FORBES                                                                   
  Assistant Attorney General                                                   
  Department of Law                                                            
  1031 West 4th, Suite 200                                                     
  Anchorage, Alaska  99501-1994                                                
  Position Statement:  Answered questions on HB 113                            
  RICK GILMORE, President                                                      
  Better Business Bureau                                                       
  4011 Artic Blvd.                                                             
  Anchorage, Alaska  99502                                                     
  Position Statement:  Answered questions on HB 113                            
  NANCY USERA, Commissioner                                                    
  Department of Administration                                                 
  P.O. Box 110200                                                              
  Juneau, Alaska  99811-0200                                                   
  Position Statement:  Testified in support of HB 158                          
  DON VELESCO, Business Manager                                                
  Public Employees Local 71                                                    
  2510 Arctic Blvd.                                                            
  Anchorage, Alaska  99503                                                     
  Position Statement:  Testified on HB 158                                     
  CHERYL FRASCA, Division Director                                             
  Division of Budget Review                                                    
  Office of Management and Budget                                              
  Office of the Governor                                                       
  P.O. Box 110020                                                              
  Juneau, Alaska 99811-0020                                                    
  Position Statement:  Commented on HB 158 and offered two                     
  BRIAN ROGERS                                                                 
  Vice President for Finance                                                   
  University of Alaska                                                         
  910 Yukon Drive                                                              
  Fairbanks, Alaska 99775-2388                                                 
  Position Statement:  Commented on HB 158                                     
  DON DEITZ                                                                    
  Alaska's Regional Port                                                       
  Port of Anchorage                                                            
  2000 Anchorage Port Road                                                     
  Anchorage, Alaska  99501                                                     
  337-1258 (H) 272-1531 (W)                                                    
  Position Statement:  Available for questions; did not                        
  PREVIOUS ACTION                                                              
  BILL:  HB 113                                                                
  BILL VERSION:                                                                
  SPONSOR(S): REPRESENTATIVE(S) LARSON                                         
  TITLE: "An Act regulating the solicitation of contributions                  
  by charitable organizations and paid solicitors and the                      
  solicitation of sales by telephonic means; and amending                      
  Alaska Rules of Civil Procedure 79 and 82."                                  
  JRN-DATE    JRN-PG                     ACTION                                
  02/01/93       199    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/01/93       199    (H)   LABOR & COMMERCE, FINANCE                        
  02/10/93       290    (H)   JUD REFERRAL ADDED,FOLLOWING L&C                 
  03/04/93              (H)   L&C AT 03:00 PM CAPITOL 17                       
  BILL:  HB 158                                                                
  SHORT TITLE: APPROP: CONTRACT SETTLEMENT COSTS                               
  BILL VERSION:                                                                
  SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR                                 
  TITLE: "An Act making appropriations for contract settlement                 
  costs and cost-of-living adjustments for public employees                    
  who are members of certain collective bargaining units; and                  
  providing for an effective date."                                            
  JRN-DATE    JRN-PG                     ACTION                                
  02/15/93       348    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/15/93       348    (H)   LABOR & COMMERCE, FINANCE                        
  02/15/93       348    (H)   GOVERNOR'S TRANSMITTAL LETTER                    
  03/04/93              (H)   L&C AT 03:00 PM CAPITOL 17                       
  ACTION NARRATIVE                                                             
  TAPE 93-18, SIDE A                                                           
  Number 006                                                                   
  VICE CHAIRMAN GREEN opened the House Labor and Commerce                      
  committee meeting.  He informed the members that they would                  
  be hearing HB 113 first.                                                     
  HB 113:  CHARITABLE & TELEPHONIC SOLICITING/SALES                            
  Number 015                                                                   
  REP. RON LARSON, PRIME SPONSOR of HB 113, gave a brief                       
  history as outlined in his sponsor statement (Attachment 1).                 
  The bill, in short, would establish regulations on                           
  telephonic solicitation and charitable solicitation.                         
  Number 088                                                                   
  REP. SITTON asked what type of enforcement capability would                  
  the state have on outfits operating out-of-state.                            
  Number 096                                                                   
  REP. LARSON said this piece of legislation would cover the                   
  out-of-state solicitation, and he mentioned that Mr. Forbes                  
  from the attorney general's office could explain the                         
  technical aspects of how that could be done.                                 
  REP. SITTON said there were a number of exemptions and                       
  inquired if Mr. Forbes would be able to answer questions                     
  about that as well.                                                          
  REP. LARSON responded that he would.                                         
  Number 104                                                                   
  REP. PORTER commented on Rep. Sitton's inquiry.  He said he                  
  had understood the bill to be an attempt to get at the                       
  fraudulent solicitors rather than those organizations that                   
  may just be bothersome.  He asked Rep. Larson if that was a                  
  fair analysis of HB 113.                                                     
  REP. LARSON answered affirmatively.                                          
  Number 127                                                                   
  SECTION, DEPARTMENT OF LAW, testified via teleconference,                    
  said he was the attorney general assigned to the fair                        
  business practices section in Anchorage.  He informed the                    
  committee that this section of the attorney general's office                 
  covers statewide and anti-trust and consumer protection                      
  MR. FORBES clarified the section in the bill regarding                       
  exemptions by explaining that this section was meant to help                 
  weed out the smaller organizations that have not been a                      
  MR. FORBES went on to say that the problems this bill                        
  attempts to address deal with charitable solicitation fraud                  
  and telemarketing fraud.  Often these solicitations involve                  
  the use of false information that cannot be readily verified                 
  over the telephone, which is why the telephonic nature of                    
  the fraud needs to be addressed.  The bill helps the law                     
  enforcers on the charitable solicitation side by giving them                 
  the way to require registration of all entities engaged in                   
  charitable fundraising in the amount of over five thousand                   
  dollars a year.                                                              
  MR. FORBES provided examples of fraudulent operations in                     
  Alaska to illustrate how this requirement, as outlined in HB
  113, would help the law enforcers catch fraudulent operators                 
  or deter misconduct.                                                         
  MR. FORBES stated that HB 113 would make engaging in                         
  fundraising without filing registration papers a                             
  misdemeanor.  If an organization was found to be dealing in                  
  fraudulent operation, that would mean they had filed                         
  fraudulent registration.  This amounts to unsworn                            
  falsification under existing law and would have the same                     
  criminal deterrent.                                                          
  MR. FORBES said he was optimistic that HB 113 would help                     
  address the two-fold problem in the charitable fundraising                   
  industry.  He explained the first problem as being that the                  
  "phoney" charities are taking money from those that                          
  otherwise may give to legitimate charities.                                  
  The second problem deals with consumer confidence.  MR.                      
  FORBES pointed out that with an increased amount of fraud                    
  there is a decrease in consumer confidence; as a result,                     
  people are less likely to trust the legitimate                               
  organizations.  He concluded that as a result of the                         
  regulations outlined in HB 113, consumers may have more                      
  confidence in charitable giving, thus giving more.                           
  MR. FORBES continued his testimony outlining the problems of                 
  the telemarketing industry.  He referenced and elaborated on                 
  Rep. Larson's comments regarding the psychological angle                     
  used by the telemarketers.                                                   
  MR. FORBES explained that HB 113 would require telemarketers                 
  to register and have a contract with a prospective customer.                 
  This aspect of the bill was patterned after a Florida law.                   
  If a fraudulent telemarketer crossed state lines, they would                 
  be guilty of a Class B felony.                                               
  Number 305                                                                   
  REP. GREEN asked Mr. Forbes if there was a proposal that                     
  would help assure people that they should sign a contract                    
  when dealing with these telemarketing organizations.                         
  Number 318                                                                   
  MR. FORBES said there was and stated that they planned to                    
  continue in a vigorous public education campaign with                        
  respect to the issues stated above.  He further stated that                  
  the assistant attorney general's office has an excellent                     
  working relationship with the Better Business Bureau of                      
  Alaska and together they can monitor the situation and put                   
  out press releases, etc.                                                     
  Number 330                                                                   
  REP. MULDER asked how this would affect businesses, such as                  
  telephone companies, or other organization involved in                       
  telemarketing activities.                                                    
  Number 332                                                                   
  MR. FORBES pointed out that newspaper sales, sales of                        
  telephone answering services, cable television or any                        
  organization regulated by the Public Utilities Commission                    
  are exempt from HB 113.                                                      
  Number 342                                                                   
  REP. PORTER asked if an individual would be guilty of a                      
  crime if they were to place an ad in the paper to sell a car                 
  and in the same day make the same proposition to three                       
  Number 352                                                                   
  (Vice Chairman Green noted that Rep. Hudson had joined the                   
  committee at 3:30 p.m.)                                                      
  Number 363                                                                   
  REP. PORTER pointed out that it was most likely a technical                  
  matter.  Referencing page 1, Section 1 (a), he noted that it                 
  does not distinguish the caller.  He went on to say he                       
  assumed the intent of that section was for the initiator of                  
  the call to register.                                                        
  Number 374                                                                   
  MR. FORBES agreed with Rep. Porter's interpretation of the                   
  intent.  He added that a he did not believe that "you can't                  
  sell that car to two or more people on the same terms                        
  because you've only got one car."                                            
  Number 380                                                                   
  REP. PORTER asked for further clarification regarding the                    
  wording "attempt to sell" and "person" in Section 1 (a).                     
  Number 387                                                                   
  MR. FORBES said he felt that this concern could be dealt                     
  with by adding another exemption and added that he felt that                 
  would be appropriate.                                                        
  Number 392                                                                   
  REP. SITTON reiterated his concern about prosecuting out-of-                 
  state offenders and asked what kind of cooperation there                     
  would be in other states.                                                    
  MR. FORBES said that most states are cooperative right now                   
  and it is the best interest of all to find the offenders.                    
  Number 406                                                                   
  testified in favor of HB 113.  He reported that the bureau                   
  office receives approximately three thousand calls a month                   
  and a minimum of fifty to sixty percent of those calls deal                  
  directly with sweepstakes and charities.  He pointed out                     
  that Alaskans are especially susceptible to this type of                     
  telemarketing because people are used to ordering things by                  
  Number 419                                                                   
  REP. HUDSON asked for some examples of persons or businesses                 
  that would register.                                                         
  MR. GILMORE said that most telemarketing organizations                       
  operate out of Nevada.  He pointed out that Nevada has laws                  
  similar to those outlined in HB 113.  He said his hope would                 
  be that once this law was enacted, it would deter fly-by-                    
  night telemarketers from operating in Alaska.                                
  Number 442                                                                   
  MR. FORBES pointed to exemption number 16 in answer to Rep.                  
  Porter's earlier questions.                                                  
  Number 450                                                                   
  REP. GREEN asked if the penalties were severe enough.                        
  Number 455                                                                   
  MR. FORBES answered that the legislature could make the                      
  penalties more severe, but there are provisions in the law                   
  that carry heavier penalties for multiple offenses.                          
  Number 473                                                                   
  REP. PORTER moved HB 113 with a zero fiscal note and                         
  individual recommendations.  No objections were heard; it                    
  was so ordered.                                                              
  HB 158:  APPROP: CONTRACT SETTLEMENT COSTS                                   
  Number 484                                                                   
  ADMINISTRATION, presented the monetary terms of the labor                    
  contract recently negotiated and gave the following                          
  description of the types of employees covered under this                     
  appropriation:  classified, nonsupervisory, and blue and                     
  gray collar employees of the executive branch.                               
  Classifications include cooks, custodians, equipment                         
  operators and skilled crafts.  The employees work primarily                  
  for the Departments of Transportation & Public Facilities,                   
  Administration, Corrections, and Health and Social Services.                 
  There are approximately 1,634 employees represented by the                   
  Public Employees Local 71.                                                   
  COMMISSIONER USERA went into some detail regarding                           
  management's goals in coming to this agreement and the                       
  contract agreement itself.  (These are on file in the                        
  committee room.)                                                             
  Number 585                                                                   
  COMMISSIONER USERA noted that the agreement includes a                       
  provision to refund the costs to employees who were required                 
  to obtain a commercial driver's license as a condition of                    
  employment.  She noted renewals will be at the expense of                    
  the employee.                                                                
  Number 599                                                                   
  CHAIRMAN HUDSON inquired if that new requirement was the                     
  result of the federal law change.                                            
  Number 604                                                                   
  DON VELESCO, MANAGER, PUBLIC EMPLOYEES LOCAL 71, stated that                 
  the federal government does require persons driving certain                  
  vehicles to have a commercial license.  Mr. Velesco further                  
  stated that the federal government controls the purse                        
  strings on some of the projects, so the state then enacted a                 
  law to require this.                                                         
  Number 611                                                                   
  REP. PORTER asked if the license was portable.                               
  COMMISSIONER USERA responded that it was.                                    
  COMMISSIONER USERA testified that the other large item in                    
  the agreement was the health insurance escalator which                       
  raises the state's contribution to $500.00 a month.                          
  Number 638                                                                   
  REP. GREEN asked why the funding was coming from several                     
  different sources.                                                           
  TAPE 93-18, SIDE B                                                           
  Number 001                                                                   
  OFFICE OF THE GOVERNOR, responded that the funding                           
  composition for the salary increase was the same as the                      
  funding composition to pay the salaries normally.                            
  Number 060                                                                   
  REP. MULDER expressed concern over there being no savings in                 
  this contract.                                                               
  Number 069                                                                   
  COMMISSIONER USERA noted that there were no wage escalator                   
  associated with this contract; reduction of a holiday saves                  
  money; and a real monetary value to change the cola date                     
  from January 1 to July 1 also adds up to a savings for the                   
  Number 109                                                                   
  COMMISSIONER USERA stated that it is her belief that health                  
  care in this nation is going to change so dramatically that                  
  in the long-run the state will realize a cost savings.                       
  Number 160                                                                   
  REP. GREEN asked what happens if health care costs skyrocket                 
  instead of come down.                                                        
  COMMISSIONER USERA responded that in two years the contract                  
  will be up.                                                                  
  Number 180                                                                   
  REP. GREEN expressed concern that this sets precedent.                       
  Number 189                                                                   
  COMMISSIONER USERA said she believes that the precedent set                  
  is a positive and realistic one.                                             
  Discussion ensued concerning strategy and details regarding                  
  the contract settlement.                                                     
  Number 279                                                                   
  REP. HUDSON asked how the amount of health insurance the                     
  state has agreed to provide compares to other public                         
  employers or other unions the state has bargained with.                      
  COMMISSIONER USERA stated that the only one she knew of that                 
  was higher was the Anchorage employees.  She further stated                  
  that the committee should remember that the Local 71                         
  "bought" this health coverage by giving up other priorities.                 
  Number 317                                                                   
  REP. MULDER asked where Commissioner Usera felt the state                    
  stood in comparison to other employers as far as benefits.                   
  COMMISSIONER USERA said she felt at this time the state was                  
  providing a great benefit package, but for the record she                    
  wanted to note that this package has been put together in                    
  increments over the years.  Furthermore, the commissioner                    
  wanted to note that the state was in a position in the late                  
  1970's where it was scrambling to find and retain a skilled                  
  workforce given the high wages paid on the slope.                            
  Number 349                                                                   
  REP. MULDER asked if the state had looked into going out to                  
  bid for an insurance carrier.                                                
  Number 353                                                                   
  COMMISSIONER USERA answered that the state was currently                     
  looking at a variety of options.                                             
  Number 357                                                                   
  REP. SITTON congratulated the unions and the administration                  
  on the process and end result of the negotiated settlement                   
  they came to.                                                                
  Number 371                                                                   
  CHAIRMAN HUDSON asked what kinds of considerations could be                  
  looked at for noncovered employees; i.e., legislative staff.                 
  Number 372                                                                   
  COMMISSIONER USERA responded that she agreed wholeheartedly                  
  that this was an area of importance to both the noncovered                   
  employee and management.                                                     
  CHAIRMAN HUDSON noted that the administration had proposed                   
  two amendments to the bill, and a third one would be                         
  presented by the university.                                                 
  Number 439                                                                   
  MR. VELESCO testified that he disagreed with the                             
  commissioner on characterizing the amount of health                          
  insurance payments as being one of the finest.  Mr. Velesco                  
  noted that the union he represents has different needs based                 
  on the kind of work done.                                                    
  Number 502                                                                   
  REP. PORTER asked if Local 71 ratified this agreement.                       
  MR. VELESCO replied yes.                                                     
  Number 507                                                                   
  MS. FRASCA offered two amendments affecting Sections 3 and 4                 
  of the bill.  Basically, these amendments were revised                       
  estimates of the number of employees affected by this                        
  Number 524                                                                   
  ALASKA, testified that the amendments before the committee                   
  represented the obligation the university had to the members                 
  of the Alaska Community College Federation of Teachers.                      
  Number 567                                                                   
  REP. PORTER asked if the university system had binding                       
  Number 568                                                                   
  MR. ROGERS answered that they do have binding arbitration to                 
  deal with any disputes under the collective agreement, but                   
  they would not proceed to binding arbitration except by                      
  mutual consent if they were to fail to reach agreement.                      
  Number 623                                                                   
  REP. SITTON moved amendments 1, 2, 3 and 4, with fiscal                      
  notes and asked unanimous consent.  There were no                            
  objections; it was so ordered.                                               
  Number 638                                                                   
  REP. PORTER moved for passage of CSHB 158(L&C)am with                        
  individual recommendations and zero fiscal notes.  There                     
  were no objections; it was so ordered.                                       
  CHAIRMAN HUDSON adjourned the meeting at 4:40 p.m.                           

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