Legislature(1997 - 1998)

02/27/1998 03:25 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
    HOUSE LABOR AND COMMERCE STANDING COMMITTEE                                
                 February 27, 1998                                             
                     3:25 p.m.                                                 
MEMBERS PRESENT                                                                
Representative Norman Rokeberg, Chairman                                       
Representative John Cowdery, Vice Chairman                                     
Representative Bill Hudson                                                     
Representative Joe Ryan                                                        
MEMBERS ABSENT                                                                 
Representative Jerry Sanders                                                   
Representative Tom Brice                                                       
Representative Gene Kubina                                                     
COMMITTEE CALENDAR                                                             
* HOUSE BILL NO. 458                                                           
"An Act relating to establishing a golf course alcoholic beverage              
license to allow sales of beer and wine; and providing for an                  
effective date."                                                               
     - MOVED CSHB 458(L&C) OUT OF COMMITTEE                                    
HOUSE BILL NO. 400                                                             
"An Act combining parts of the Department of Commerce and Economic             
Development and parts of the Department of Community and Regional              
Affairs by transferring some of their duties to a new Department of            
Commerce and Rural Development; transferring some of the duties of             
the Department of Commerce and Economic Development and the                    
Department of Community and Regional Affairs to other existing                 
agencies; eliminating the Department of Commerce and Economic                  
Development and the Department of Community and Regional Affairs;              
relating to the Department of Commerce and Rural Development;                  
adjusting the membership of certain multi-member bodies to reflect             
the transfer of duties among departments and the elimination of                
departments; and providing for an effective date."                             
     - HEARD AND HELD                                                          
HOUSE BILL NO. 304                                                             
"An Act relating to the location of the convening of the                       
legislature in regular session; repealing provisions relating to               
student guests of the legislature; and providing for an effective              
     - BILL HEARING CANCELLED                                                  
(* First public hearing)                                                       
PREVIOUS ACTION                                                                
BILL: HB 458                                                                   
SHORT TITLE: GOLF COURSE BEER/WINE LICENSE                                     
SPONSOR(S): LABOR & COMMERCE BY REQUEST                                        
Jrn-Date    Jrn-Page           Action                                          
02/18/98      2363     (H)  READ THE FIRST TIME - REFERRAL(S)                  
02/18/98      2363     (H)  LABOR & COMMERCE                                   
02/27/98               (H)  L&C AT  3:15 PM CAPITOL 17                         
BILL: HB 400                                                                   
SPONSOR(S): REPRESENTATIVES(S) KOHRING, Austerman, Barnes,                     
Cowdery, Hodgins, Kelly, Mulder, Ogan, Ryan, Therriault, Vezey                 
Jrn-Date    Jrn-Page           Action                                          
02/12/98      2307     (H)  READ THE FIRST TIME - REFERRAL(S)                  
02/12/98      2308     (H)  L&C, FINANCE                                       
02/23/98               (H)  L&C AT  3:15 PM CAPITOL 17                         
02/23/98               (H)  MINUTE(L&C)                                        
02/25/98               (H)  L&C AT  3:15 PM CAPITOL 17                         
02/25/98               (H)  MINUTE(L&C)                                        
02/27/98               (H)  L&C AT  3:15 PM CAPITOL 17                         
WITNESS REGISTER                                                               
JEFF BARNHART, Manager                                                         
Palmer Municipal Golf Course and                                               
   Russian Jack Springs Municipal Golf Course                                  
231 West Evergreen Avenue                                                      
Palmer, Alaska 99645                                                           
Telephone:  (907) 745-4653                                                     
POSITION STATEMENT:  Testified in favor of HB 458.                             
DON DAPCEVICH, Executive Director                                              
Governor's Advisory Board on                                                   
   Alcoholism and Drug Abuse                                                   
P.O. Box 110608                                                                
Juneau, Alaska 99811-0608                                                      
Telephone:  (907) 465-8920                                                     
POSITION STATEMENT:  Testified against HB 458.                                 
FRED JAMES                                                                     
P.O. Box 499                                                                   
Palmer, Alaska 99645                                                           
Telephone:  (907) 586-6459                                                     
POSITION STATEMENT:  In favor of HB 458; testified in support of               
                     HB 400, suggested additional changes.                     
DOUG GRIFFIN, Director                                                         
Alcoholic Beverage Control Board                                               
550 West 7th Avenue, Suite 350                                                 
Anchorage, Alaska 99501                                                        
Telephone:  (907) 277-8638                                                     
POSITION STATEMENT:  Testified on HB 458.                                      
DWIGHT PERKINS, Special Assistant                                              
Office of the Commissioner                                                     
Department of Labor                                                            
P.O. Box 21149                                                                 
Juneau, Alaska 99802-1149                                                      
Telephone:  (907) 465-2700                                                     
POSITION STATEMENT:  Testified on Section 65 of HB 400 which would             
                     move the Job Training Partnership Act                     
                     Program into the Department of Labor from                 
                     the Department of Community and Regional                  
MIKE KRIEBER, Legislative Administrative Assistant                             
   to Representative Vic Kohring                                               
Alaska State Legislature                                                       
Capitol Building, Room 421                                                     
Juneau, Alaska  99801                                                          
Telephone:  (907) 465-6863                                                     
POSITION STATEMENT:  Answered questions on HB 400.                             
SUSAN RODEHEAVER                                                               
P.O. Box 1128                                                                  
Kodiak, Alaska 99615                                                           
Telephone:  (907) 486-7064                                                     
POSITION STATEMENT:  Testified against HB 400, specifically against            
                    changes to the Head Start Program.                         
ROBERT HALL                                                                    
P.O. Box 871906                                                                
Wasilla, Alaska 99687                                                          
Telephone:  (907) 892-6557                                                     
POSITION STATEMENT:  Provided testimony to Mr. Gifford supporting              
                     HB 400.                                                   
DAN GIFFORD                                                                    
P.O. Box 874803                                                                
Wasilla, Alaska 99687                                                          
Telephone:  (907) 373-5606                                                     
POSITION STATEMENT:  Read Mr. Hall's testimony; testified in                   
                     support of HB 400.                                        
KEVIN RITCHIE, Executive Director                                              
Alaska Municipal League                                                        
217 Second Street, Suite 200                                                   
Juneau, Alaska 99801                                                           
Telephone:  (907) 586-1325                                                     
POSITION STATEMENT:  Testified on HB 400.                                      
SYLVIA SULLIVAN, President                                                     
Alaskans for a Just Society                                                    
P.O. Box 2684                                                                  
Valdez, Alaska 99686                                                           
Telephone:  (907) 835-3729                                                     
POSITION STATEMENT:  Testified against HB 400.                                 
ACTION NARRATIVE                                                               
TAPE 98-20, SIDE A                                                             
Number 0001                                                                    
CHAIRMAN NORMAN ROKEBERG called the House Labor and Commerce                   
Standing Committee meeting to order at 3:25 p.m.  Members present              
at the call to order were Representatives Rokeberg, Cowdery, Hudson            
and Ryan.  He noted the committee would be hearing HB 458 and HB
400; HB 400 had also been scheduled for Friday, March 6.                       
HB 458 - GOLF COURSE BEER/WINE LICENSE                                         
Number 0093                                                                    
CHAIRMAN ROKEBERG announced the committee's first item of business             
was HB 458, "An Act relating to establishing a golf course                     
alcoholic beverage license to allow sales of beer and wine; and                
providing for an effective date."  He stated HB 458 was coming in              
as a committee bill.  He referred to information in the committee              
members' packets and explained that the City of Palmer and its golf            
course ran into a problem after the course's establishment a few               
years ago.  Chairman Rokeberg said he believed what occurred was               
that approximately concurrent with the establishment of the Palmer             
Municipal Golf Course, a regulation was passed by the Alcoholic                
Beverage Control (ABC) Board for a municipal golf course license in            
15 AAC 104.670, providing that a beer and wine license could be                
obtained by a municipal golf course with a minimum of nine holes               
covering 1,200 yards ["120 yards" stated on tape] for a biennial               
fee of $400.  He indicated he believed the ABC Board had no real               
authority to do that, commenting there was a provision in the                  
statutes which "gave them a little bit of a wrinkle there."                    
Chairman Rokeberg said the problem with the license is that the                
beer and wine could be served in the building but not taken                    
outside, which he indicated is a traditional golf course practice.             
He said that beverages are traditionally available at the "turn"               
between the ninth and tenth holes, and, in the more luxurious golf             
courses, beverages are often sold from a cart driven around the                
Number 0326                                                                    
CHAIRMAN ROKEBERG indicated a golf course would have to have a                 
"package store license" to sell alcohol to be taken outside, and               
therefore, in Alaska, a golf course would be required to have both             
a beer and wine license and a package store license to allow these             
traditional functions which revolve around a recreational golf                 
course area.  He believed the testimony would show the difficulties            
the City of Palmer has had with this particular issue, noting the              
issue first came to his attention almost two years ago; he had                 
hoped something could have been worked out in the interim but it               
has not been.  Chairman Rokeberg also commented on the                         
proliferation of golf course development and planned golf course               
development in Alaska and worldwide.  He said golf is a growing                
sport because of changing demographics and aging populations, and              
he indicated the bill, in addition to clearing up the statute to               
help out the municipal golf courses, is also designed to encourage             
the development of golf courses throughout the state which meet                
minimum standards.  He said, "Also to make sure that it didn't come            
in the population count.  ... As you all know, there are certain               
restrictions on the number of types of licenses that relate to                 
population, so this bill exempts that."  He stated a course had to             
be "championship in nature."  Although only nine holes are                     
required, half of a true championship course, he said it has to be             
a long course, referring to Version K and indicating the committee             
might want to adjust those standards slightly.  Chairman Rokeberg              
noted it was questionable whether the Mendenhall golf course in                
Juneau would qualify.                                                          
REPRESENTATIVE BILL HUDSON commented the new one would though.                 
Number 0556                                                                    
CHAIRMAN ROKEBERG referred to information in the packets,                      
commenting that the Weeping Trout Sports Resort in Haines would                
also be too short to qualify because it wasn't championship in                 
nature.  He stated that it usually required a capital investment of            
well in excess of a million dollars to develop a true championship             
golf course of at least nine holes, noting HB 458 would be helpful             
to the economic development of the area and the building of golf               
courses.  He stated there were approximately three witnesses                   
waiting to testify.                                                            
Number 0613                                                                    
REPRESENTATIVE JOHN COWDERY confirmed that all the laws governing              
the sale of alcohol, including sale to minors, would still apply.              
Number 0623                                                                    
CHAIRMAN ROKEBERG answered in the affirmative.  He indicated Mr.               
Griffin from the ABC Board was available for questions via                     
Number 0631                                                                    
REPRESENTATIVE COWDERY confirmed that possible existing                        
restrictions regarding things like liquor licenses being close to              
schools had been considered.                                                   
Number 0654                                                                    
CHAIRMAN ROKEBERG noted those restrictions did exist and had been              
Number 0671                                                                    
REPRESENTATIVE JOE RYAN said that it appeared on the surface that              
anyone who consumes alcohol and plays golf would have a conflict of            
interest, noting that he did not do either and was declaring a non-            
conflict but was going to keep an eye on everybody else.                       
Number 0682                                                                    
CHAIRMAN ROKEBERG said he was a golf aficionado but could not                  
imbibe alcoholic beverages and play golf simultaneously, noting he             
therefore had no direct conflict of interest.                                  
Number 0710                                                                    
REPRESENTATIVE RYAN noted he had to go a House Health, Education               
and Social Services Standing Committee meeting for a bill.                     
Number 0715                                                                    
CHAIRMAN ROKEBERG stated the committee had a proposed committee                
substitute (CS) before it.                                                     
Number 0721                                                                    
REPRESENTATIVE HUDSON moved the adoption of Version L, proposed CS             
for HB 458, labeled 0-LS0507\L, Ford, dated 2/27/98.  He asked                 
unanimous consent.                                                             
Number 0729                                                                    
CHAIRMAN ROKEBERG requested that Representative Ryan return to the             
meeting at some point, commenting that it was the chairman's                   
intention to move HB 458 that day unless there were substantial                
problems.  He stated the proposed CS had been adopted, and                     
indicated the change from the original bill was on page 2, line 31,            
where the golf course size had been increased from 2,500 to 2,950              
yards.  He said they believe the new Muskey Meadow golf course in              
Wrangell is 3,035 yards, indicating they want to make sure that                
this is adequate to make a distinction between a true golf course              
and a smaller "pitch and putt (indisc.)" or executive course.                  
Number 0783                                                                    
JEFF BARNHART, Manager, Palmer Municipal Golf Course (Palmer Golf              
Course) and Russian Jack Springs Municipal Golf Course, testified              
via teleconference from Anchorage.  He referred to his letter which            
was in the bill packet, noting that the Palmer Municipal Golf                  
Course had run into many financial difficulties until the current              
year, and had become a drain on the City of Palmer's finances.  He             
said the course was turned over to a management group and is slowly            
turning around financially.  Mr. Barnhart commented on the liquor              
restriction; beer and wine can be sold but cannot leave the                    
building.  In the situation of tournaments, noting they have had               
nearly 60 tournaments a season, beer, wine and sodas have been                 
provided for entertainment and fund-raising purpose.  However, he              
indicated, he cannot sell any beer or wine on the course and people            
end up bringing their own because of the way the law is currently              
written.  He noted the alcoholic beverages are on the golf course,             
but he is not able to benefit or add any profit situation to the               
golf course.                                                                   
Number 0896                                                                    
MR. BARNHART also indicated he cannot sell alcoholic beverages to              
the course's weekend or mid-week players who would like to take a              
beer or two with them out onto the course or buy one at the turn               
shack.  Again, he has found these players simply bring it                      
themselves without restriction from the golf course, noting that is            
how these players enjoy their golf and he certainly wants them to              
continue to enjoy their golf.  However, he indicated this has put              
some economic strain on the golf course.  Mr. Barnhart said there              
is another problem, although not as significant, which he sees as              
a control problem.  He indicated he has no way of knowing, besides             
the standard indications of intoxication, how many alcoholic                   
beverages a person may have consumed on the course if that person              
then goes into the building to drink after a golf game.  He said               
they would have a better "handle" on alcohol consumption rates if              
they were the ones that were able to sell alcoholic beverages to               
these people, noting, again, that people are bringing it                       
themselves.  His understanding of the package store license is that            
(indisc.) could buy one, step outside the door and drink it with it            
still being lawful.  He said that if he's capable of selling beer              
or wine to people, he can prohibit people from bringing it or                  
introducing it to the golf course as is done at the state fair,                
noting introducing alcoholic beverages to the fairgrounds or                   
leaving the partitioned premises with it is not allowed.                       
Number 1013                                                                    
MR. BARNHART said the other thing (indisc.) is that the bill is                
more open than just to municipal golf courses, indicating the sale             
of alcoholic beverages is such a large area of profit, and such an             
expected part of a golf course out of state or for golf course                 
development in Alaska.  He commented, "You'd definitely want to be             
able to sell the beer and wine.  If you really, really had the                 
investment, you'd probably take it beyond that, which would make a             
large investment into a much more expensive liquor license."  Mr.              
Barnhart noted the cost of golf course development, commenting that            
the Palmer Golf Course was built for a little over $2 million and              
the land did not have to be purchased.  He said a large development            
could easily run $5 million dollars and every avenue to generate               
the income would certainly be needed, noting that was generally his            
concern.  He said he has had meetings with the Municipality of                 
Anchorage regarding its desires for the Russian Jack Springs Golf              
Course, and does not know if it would ever be pursued, but he said             
if it was available, it could certainly become more of an issue for            
them to deal with.  Mr. Barnhart stated the Palmer Golf Course                 
definitely needs it, commenting that the golf course has probably              
drained off nearly $2 million dollars out of the city's funds and              
has created problems for many years.  He said they have turned it              
around but will need help to continue growth as other golf courses             
are developed in the area, indicating Fort Richardson is expanding             
to an 18-hole course.  He noted they need to be able to compete, or            
at least keep their heads above water, so that the golf course will            
be able to pay for itself and the Palmer taxpayers won't have to               
continue to support it.  He commented that this was the ultimate               
Number 1130                                                                    
CHAIRMAN ROKEBERG asked if this problem could be solved if the golf            
course could purchase a package store license.                                 
Number 1137                                                                    
MR. BARNHART replied in the affirmative.  However, he said Palmer's            
demographics are so small and the political arena is such that the             
city's government does not want to compete against a private                   
citizen for that particular license if it became available.  He                
said the golf course had been rezoned and the boundaries of the                
city limits redrawn so the golf course would have to pay sales tax,            
indicating the city was very growth-oriented and did not want to be            
in competition with the public for the "growth money."                         
Number 1183                                                                    
CHAIRMAN ROKEBERG asked how many yards the Russian Jack Springs                
Golf Course was.                                                               
Number 1200                                                                    
MR. BARNHART replied that the Russian Jack course was "just shy" of            
3,000 yards, depending on tee position.                                        
CHAIRMAN ROKEBERG asked if it would qualify at 2,950 yards from the            
MR. BARNHART responded that length would require some                          
reconfiguration, indicating a 2,500 yard requirement would allow               
the course to qualify.  He noted that measurement is a tough one,              
as they had previously discussed, questioning what set of tees is              
the yardage measurement taken from.                                            
Number 1216                                                                    
CHAIRMAN ROKEBERG noted he would say for the maximum yardage, to               
the benefit of the course.                                                     
Number 1221                                                                    
MR. BARNHART stated he thought 2,500 yards would be a very                     
comfortable yardage for any developer, even for a nine-hole,                   
executive-style course which he said is a popular style of course              
because of the lower amount of land needed.  He indicated he thinks            
any developer would build a nice golf course if the minimum yardage            
was 2,500.                                                                     
Number 1241                                                                    
CHAIRMAN ROKEBERG noted that the limits had been raised in the bill            
to 2,950 yards.                                                                
MR. BARNHART said he thought that the tee configuration at the                 
Russian Jack Springs Golf Course could be conformed to that.                   
Number 1254                                                                    
CHAIRMAN ROKEBERG indicated the intention was to only have truly               
real golf courses qualify rather than executive or "pitch and putt"            
Number 1261                                                                    
MR. BARNHART indicated the "mom and pop" backyard courses would be             
eliminated by this legislation, noting he thought that was the way             
to go.  He said there wasn't the developmental money, for one.  Mr.            
Barnhard indicated he thinks they need to use this as a pro-                   
development tool.  He said he thinks when they want to build more              
tourist attractions or more things for tourists to do, that these              
tourists should be going to a better-quality, nicer golf course,               
indicating he doesn't think a "mom and pop" backyard, four-hole                
course should be able to sell beer and wine.  Mr. Barnhart said he             
thinks this is designed correctly and is pro-development.                      
Number 1297                                                                    
CHAIRMAN ROKEBERG asked Mr. Barnhart if he was a member of the                 
Professional Golfers' Association of America (PGA).                            
MR. BARNHART answered in the affirmative.                                      
CHAIRMAN ROKEBERG confirmed that Mr. Barnhart was a golf "pro."  He            
noted the committee would go first to the two witnesses in Juneau.             
Number 1335                                                                    
DON DAPCEVICH, Executive Director, Governor's Advisory Board on                
Alcoholism and Drug Abuse, came forward to testify.  He said he has            
been instructed by the board to speak in opposition to HB 458.  He             
noted he was an avid golfer and he speaks personally and                       
professionally against this.  He stated they just keep finding new             
ways to get new outlets to sell alcohol in Alaska.  He said Alaska             
would have to increase its population to 1,575,000 people to                   
conform to the existing rules with regards to distilled spirits.               
He reiterated that they keep finding more ways to sell more alcohol            
in Alaska, and they "keep burying the fruits of those sales by all             
the problems" they have in the criminal justice and court systems.             
Mr. Dapcevich noted his other concern was that this bill appears to            
limit access to golf by youth, if golf courses become one large                
beer and wine license facility.  He said, from a public policy                 
standpoint, he thinks this is poor public policy and would speak               
against the bill.                                                              
Number 1416                                                                    
CHAIRMAN ROKEBERG referred to Mr. Dapcevich's statement that he was            
an avid golfer and asked him if all the real golf courses he has               
played have served alcoholic beverages.                                        
Number 1426                                                                    
MR. DAPCEVICH replied that most do serve alcoholic beverages.                  
Number 1431                                                                    
CHAIRMAN ROKEBERG asked if he could name one that didn't.                      
Number 1435                                                                    
MR. DAPCEVICH recalled he has played several courses in Arizona and            
California that do not allow alcohol on the course but do sell it              
in the bars.                                                                   
Number 1446                                                                    
CHAIRMAN ROKEBERG noted Mr. Dapcevich indicated the Governor's                 
Advisory Board on Alcohol and Drug Abuse had instructed him to                 
oppose HB 458.  He asked if the board had met on this very bill.               
MR. DAPCEVICH replied that the board had considered all the bills              
in its winter meeting, noting HB 458 was the last bill the board               
had considered at its meeting in Juneau the previous week, on the              
day this bill had been introduced.                                             
Number 1468                                                                    
CHAIRMAN ROKEBERG stated he was glad the board had a chance to look            
at it.  He asked Mr. Dapcevich if he drank alcohol.                            
MR. DAPCEVICH answered in the negative.                                        
Number 1489                                                                    
CHAIRMAN ROKEBERG called Fred James to testify, indicating Mr.                 
James had signed the witness register for HB 458 and was from                  
FRED JAMES indicated he wished to testify on HB 400, but said he               
liked HB 458.                                                                  
Number 1507                                                                    
REPRESENTATIVE HUDSON asked if the advisory board's control over               
licenses was principally relating to population, and if that was               
the biggest concern, that this does not relate to population or                
proximity to schools and things of that nature.                                
Number 1536                                                                    
MR. DAPCEVICH said the board's concern is that the number of                   
outlets for alcohol in the state keep growing "by leaps and bounds"            
far beyond the intent or the spirit of the statute.  He indicated              
this is just another one of those special conditions making alcohol            
even more accessible in Alaska, which already has a significant                
alcohol problem.                                                               
Number 1558                                                                    
REPRESENTATIVE HUDSON noted the outside recreational aspect of                 
golf, indicating he thought this seemed to be of less social harm              
than many of the other situations where alcoholic beverages were               
Number 1585                                                                    
MR. DAPCEVICH responded he would not suggest that a beer and wine              
license was more detrimental than a distilled spirits license in               
terms of the social harm it does.                                              
Number 1600                                                                    
REPRESENTATIVE COWDERY said it was his observation that golfers                
sometimes drive for good distances to play golf.  He said golfers              
could presently bring their own alcoholic beverages to the course,             
asking if that was correct.                                                    
Number 1628                                                                    
CHAIRMAN ROKEBERG replied they could to the Palmer Golf Course but             
he thought it varied, depending on the particular course's rules               
and regulations, and it was very customary to restrict the use of              
personal alcohol on courses.  He referred to Mr. Barnhart's                    
testimony, indicating he believed that if the Palmer Golf Course               
had this license, it would be able to better control alcohol                   
consumption on the course because the course management could                  
prohibit the importation of alcoholic beverages not purchased from             
the clubhouse or golf course.                                                  
Number 1658                                                                    
REPRESENTATIVE COWDERY indicated there seemed to be a freedom issue            
as well.  He noted he was not normally a beer consumer, mentioning             
restaurants.   He said if people go to the golf course and this is             
what they want, it was more of a "freedom thing" and they should               
give this ability to the course owners to enhance that.                        
Number 1701                                                                    
CHAIRMAN ROKEBERG responded:  1) that it was clear in their                    
statutory scheme that the state has a compelling interest to                   
regulate alcohol consumption; and 2) the rules and regulations of              
a private, public or quasi-public premise rules of conduct                     
(indisc.) that each individual organization and private club, for              
example, should be able to make up their own rules, noting he                  
didn't think there were any infringements on right here.  He asked             
Mr. Dapcevich if the advisory board had ever supported the creation            
of a new type of liquor license.                                               
Number 1741                                                                    
MR. DAPCEVICH answered, "Absolutely not."                                      
Number 1744                                                                    
CHAIRMAN ROKEBERG noted, then, that the board's opposition to this             
license was not inconsistent with its ongoing policy to oppose any             
new outlets, et cetera.  He asked if that was correct.                         
MR. DAPCEVICH answered in the affirmative.                                     
Number 1753                                                                    
CHAIRMAN ROKEBERG said then that the board did not make a                      
distinction as to whether this license would be less harmful vis- -            
vis any other type of license.                                                 
Number 1758                                                                    
MR. DAPCEVICH replied only with respect to the matter of youth                 
being served by golf courses and also being exposed to alcohol                 
under this scenario, noting that makes it somewhat different from              
other licenses and more onerous.                                               
Number 1778                                                                    
CHAIRMAN ROKEBERG noted he hoped that in this society this would               
not lead to further uncontrolled and improper abuse of alcoholic               
Number 1792                                                                    
MR. DAPCEVICH clarified that the board was not prohibitionist; the             
board is opposed to any new licenses or any licenses that go beyond            
the spirit and the statute with regards to population base and                 
alcohol sales in the state.                                                    
Number 1806                                                                    
CHAIRMAN ROKEBERG stated the committee would take testimony next               
from Doug Griffin, and appreciated any direction Mr. Griffin could             
give the committee on this bill.                                               
Number 1824                                                                    
DOUG GRIFFIN, Director, Alcoholic Beverage Control Board, testified            
via teleconference from Anchorage [NOTE:  FURTHER TESTIMONY SHOWS              
OF HB 458, NOT THE PROPOSED CS].  He said the best way for him to              
approach it was from a technical, then policy, side.  He said the              
city manager of the City of Palmer had come to the ABC Board in                
approximately August of 1996 addressing this issue, and the board              
at that time suggested the purchase of a package store license.  He            
indicated, given the local politics and the availability of                    
municipal funds, that may not have been an option.  Mr. Griffin                
said there was no question that the board was "at loggerheads" with            
the Palmer Golf Course and the City of Palmer on that point.  Based            
on that situation, he would have to say that the board still thinks            
a package store license is the best option for the golf course,                
commenting that it would also be in opposition to creating a new               
license and license type.  He said the board tries to accommodate              
the needs of people to have access to alcoholic beverages within               
the existing license structure and it tries very much to use the               
current general license structure to meet needs as these needs                 
arise.  Mr. Griffin noted the authority in the regulation for                  
creating a municipal golf course license had been mentioned.  He               
indicated that license was created somewhat in response to a                   
request from the City of Palmer when it started its municipal-type             
golf course, which was unique at time.  He noted he was not the                
director of the ABC Board at that time, nor did he believe any of              
the current members were serving, but the statutory authority he               
would cite for that action by the board was AS 04.06.100,                      
subsection (14), "creation of classifications of licenses or                   
permits not provided for in this title;" which basically says that             
the board, by regulation, can create classifications of licenses or            
permits not provided for in that title.  He noted, therefore, that             
the board has a fairly broad mandate in the creation of new                    
licenses and probably could have done so when so requested by the              
City of Palmer a couple of years ago.  He said the board had not               
chosen to do so because it felt that the licenses were out there.              
He indicated the board thought that if the City of Palmer felt this            
was necessary as a business decision, the license would be                     
purchased, and he understood the financial hardship associated with            
this Mr. Barnhart mentioned.  Mr. Griffin said he thought the board            
would be opposed to HB 458 just because it does create an                      
additional license and a new type of license.                                  
Number 1972                                                                    
MR. GRIFFIN indicated there were some real problems from a                     
technical point of view.  He said the board thinks an unintended               
consequence of the bill is that the entire golf course would become            
the licensed premise, and he thinks it is very clear that is what              
the bill does.  He said, in effect, the area of the whole golf                 
course was being made into a bar, and all kinds of statutes from               
Title 4 would come into play.  However, he said, most importantly,             
anyone under the age of 21 would be legally prohibited from                    
entering and remaining on the premises of the golf course unless               
accompanied by a parent or legal guardian - it would be the same as            
a minor entering and remaining in a bar.  So, even though the ABC              
Board has the policy concerns, he said that is why the board, in               
its discussions with Palmer's city manager and others, thought the             
package store approach made the most sense.  He noted this was what            
was used at the Anchorage Golf Course on O'Malley Road; a person               
could go in, buy a couple of beers and consume them on the course,             
and he commented that there is no legal prohibition in Alaska                  
against consuming alcohol in public, assuming the person is of                 
proper age and not creating any other kind of nuisance in doing so.            
He said that from a technical standpoint this solution would be                
less problematic for the people they were trying to assist.  Mr.               
Griffin emphasized the board was opposed from a policy point, but,             
he said, if the committee really wanted to do this, in order to                
make this thing work better, he recommended the establishment of               
some type of municipal golf course package store license.  He                  
indicated limiting the license to beer and wine might make it a                
little easier.  Mr. Griffin said he was available for questions,               
noting Bill Roche, Enforcement Supervisor, Alcoholic Beverage                  
Control Board, was also available.                                             
Number 2128                                                                    
CHAIRMAN ROKEBERG stated it had not been the committee's intent to             
limit youth golfing and he indicated clarification had been                    
requested from the drafter to make certain the bill did not do                 
these very things brought to the committee's attention by Mr.                  
Griffin and Mr. Dapcevich.  Chairman Rokeberg indicated he was                 
asking Mr. Griffin if language replicating the beer and wine                   
license and package store license would make him more comfortable.             
Number 2167                                                                    
MR. GRIFFIN said that would accomplish what the committee was                  
trying to accomplish; the board would still be opposed to it, but              
would be a lot less opposed.  He noted a good point had been made,             
giving the example of a recreational site license approved by the              
ABC Board for the racetrack not too far from the Palmer Golf                   
Course.  He noted part of the rationale used was the same issue Mr.            
Barnhart had raised, the management of the premise would have more             
control.  He indicated, however, he did not think it would be                  
enough to convince the board to create another type of license.  He            
said that aspect does make some sense if it went hand in hand with             
prohibiting people from bringing their own alcohol onto the course,            
noting he thinks management could do this as a matter of policy if             
they provided through their own package store.                                 
Number 2221                                                                    
CHAIRMAN ROKEBERG stated Mr. Griffin said the board would oppose               
this on the policy it did not want to create another license but he            
suggested that they would not really be creating another license;              
they would be replacing an existing regulation that specifies a                
municipal golf course license which this bill would terminate.  He             
said basically the regulatory license promulgated by the board                 
would be replaced by a statutory license.                                      
Number 2247                                                                    
MR. GRIFFIN said that was a good point.  He noted the scope of the             
existing license the board created through regulation was being                
expanded, indicating he was not sure how the board would look on               
Number 2281                                                                    
CHAIRMAN ROKEBERG stated, "I also suggest to you, sir, that by                 
raising the yardage requirements up that -- the municipal                      
regulation now is only 1,200 yards, we're - we're raising it up to             
a real substantial investment and a ... major construction-type                
project which would be intended to generate tourism and (indisc.)              
be an amenity to a community, and would - would necessitate the                
scope of activities including environmental impact statements and              
full public hearings before a course could even be built, and                  
therefore would have a lot of public input on it."  He indicated it            
would not be somebody's back yard "pitch and putt" ["20 acres"                 
stated on tape].  Although he noted Mr. Griffin was correct in that            
HB 458 expanded the scope of the license from the municipality to              
anybody in the public or private sector and he appreciated Mr.                 
Griffin's testimony.  Chairman Rokeberg stated they had requested              
the bill drafter, Mike Ford, to inform the committee of his                    
intentions in the drafting of the bill.  Chairman Rokeberg noted               
the instructions had been given to draft the bill in such a manner             
that it would meet the criticisms which have been raised, and he               
said, either Mr. Ford would convince then all, or the bill would be            
held over until the language was corrected, because they did not               
want the bill to contain anything which would restrict the use of              
a recreational facility by youth.  Chairman Rokeberg indicated to              
Mr. Ford that Version L had been adopted by the committee but                  
concern had been raised by page 2, new section 04.11.115, "(a) A               
golf course license authorizes the licensee to sell and serve beer             
and wine for consumption on licensed premises located on a golf                
course."  The chairman noted it went on to say in subsection (c) on            
line 21 "... and a detailed diagram that clearly identifies a                  
proposed area that constitutes the licensed premises. ...", and                
testimony from the ABC Board and other sources states that a                   
boundary is being delineated which would be analogous to one big               
Number 2428                                                                    
MR. GRIFFIN stated that they had just received a copy of the                   
proposed CS and he thinks it may address those issues.  He                     
requested a minute to review the current version.                              
Number 2443                                                                    
CHAIRMAN ROKEBERG asked Mr. Ford what he did to fix this.                      
TAPE 98-20, SIDE B                                                             
Number 0007                                                                    
MIKE FORD, Attorney, Legislative Legal and Research Service,                   
Legislative Affairs Agency, came forward to testify.  As he                    
understands the problem, they do not want to describe licensed                 
premises as being the golf course, so in this version he has                   
attempted to restrict the licensed premises to a building or a                 
motor vehicle on the golf course, not to the entire course.  He                
said if that has not been achieved, changes can be made, but he                
believes the proposed CS should solve that problem of having an                
entire golf course become off limits to people under age 21.                   
Number 0052                                                                    
CHAIRMAN ROKEBERG said that then the problem becomes that all good             
golfers want to encourage walking, not riding golf carts, and he               
asked what happens to the walking golfer under Mr. Ford's                      
definition on page 3.                                                          
Number 0070                                                                    
MR. FORD replied he didn't see that as being a problem.  A person              
could still walk up to the motorized vehicle and partake if the                
person chose, but the person would not be required to ride a cart.             
Number 0085                                                                    
CHAIRMAN ROKEBERG asked if a person could carry an open container              
down the fairway and consume it.                                               
Number 0102                                                                    
MR. FORD confirmed that Chairman Rokeberg was referring to walking             
with a can of beer.  He said he would like to hear what the ABC                
Board thought of that, commenting that if it was necessary, new                
language could be created.                                                     
Number 0131                                                                    
CHAIRMAN ROKEBERG noted that was a constituent element everyone saw            
there, indicating the situation where the entire boundaries of the             
golf course is described as the licensed premise because of the                
impact on underage people.                                                     
Number 0150                                                                    
MR. FORD clarified that they were talking simply about sales of                
beer, not possession.  He noted Chairman Rokeberg was speaking of              
possession walking on the course.  Mr. Ford said possession is                 
currently allowed and that shouldn't be a problem.                             
Number 0180                                                                    
MR. GRIFFIN stated that was correct.  He indicated they had looked             
the proposed CS over and it appears the committee has addressed the            
board's concern about the licensed premise issue, noting he thinks             
Mr. Ford has clearly done that.  He stated he thinks this is okay              
and the technical aspect has been addressed.                                   
Number 0224                                                                    
CHAIRMAN ROKEBERG noted there had been earlier testimony stating               
there was no prohibition on the consumption of alcohol, with the               
restriction of no open container in a motor vehicle.                           
Number 0248                                                                    
There was a brief discussion between Chairman Rokeberg, Mr. Ford               
and Mr. Griffin regarding the term "motor vehicle," and whether it             
was necessary to add the language "unlicensed" to indicate that the            
motor vehicle in question on the golf course would most likely be              
a motorized golf cart.                                                         
Number 0368                                                                    
MR. GRIFFIN stated he did not think there was going to be a                    
problem, noting he did not think they need to call it an unlicensed            
vehicle.  He indicated the vehicle clearly needed to be operated               
safely and in way that was not hazardous to anyone.                            
Number 0432                                                                    
CHAIRMAN ROKEBERG thanked Mr. Ford for his testimony.  He stated               
that concluded the testimony on HB 458; the committee would hold               
the bill over for a short period and proceed with the meeting                  
HB 400 - DEPT OF COMMUNITY & ECONOMIC DEVELOPMENT                              
Number 0451                                                                    
CHAIRMAN ROKEBERG announced the committee's next item of business              
would be HB 400, "An Act combining parts of the Department of                  
Commerce and Economic Development and parts of the Department of               
Community and Regional Affairs by transferring some of their duties            
to a new Department of Commerce and Rural Development; transferring            
some of the duties of the Department of Commerce and Economic                  
Development and the Department of Community and Regional Affairs to            
other existing agencies; eliminating the Department of Commerce and            
Economic Development and the Department of Community and Regional              
Affairs; relating to the Department of Commerce and Rural                      
Development; adjusting the membership of certain multi-member                  
bodies to reflect the transfer of duties among departments and the             
elimination of departments; and providing for an effective date."              
Number 0459                                                                    
DWIGHT PERKINS, Special Assistant, Office of the Commissioner,                 
Department of Labor (DOL), came forward to testify.  He noted the              
committee had heard a great deal of testimony over the last few                
days and he had prepared a statement on behalf of the DOL to read              
into the record:                                                               
     In Section 65 ... of HB 400 it states that the Department                 
     of Labor shall operate the federally-funded employment                    
     and training programs under 29 U.S.C. 1501 through                        
     1792(b), the Job Training Partnership Act [JTPA].  The                    
     impact of this section would be to transfer the JTPA                      
     Program from Department of Community and Regional Affairs                 
     to Alaska Department of Labor.  Alaska Department of                      
     Labor ... has had a long and productive partnership with                  
     the Department of Community and Regional Affairs, and as                  
     Alaska Department of Labor has not administered this                      
     program, the transition would protract the coordination                   
     and distribution of the JTPA grants, as well ... as the                   
     impact in close employer relationships that have been                     
     generated by the JTPA.  Additionally, a mere program                      
     transfer would promulgate new leases for working space,                   
     remodeling and furniture and supply costs.  In conclusion                 
     ... the Department of Labor envisions ... no immediate                    
     benefit to the public recipients of these services, both                  
     job seekers and employers, nor do we see any monetary                     
     savings from the JTPA transfer to Labor.                                  
MR. PERKINS noted that concluded his prepared statement.  In                   
addition, he indicated many people are under the impression DOL is             
in the business of job training, stating the department really is              
not.  He said that when a person is unemployed, it is the DOL's                
mission to get that individual back into the workforce as soon as              
possible to avoid depletion of the unemployment insurance (UI)                 
trust fund.  He referred to previous testimony, noting that, as                
they have heard, the missions are considerably different.                      
Commenting on the relationship DCRA has with the rural communities             
throughout the state, Mr. Perkins said the DOL feels it would                  
probably be in the best interest for JTPA to remain where it                   
currently is.                                                                  
Number 0664                                                                    
CHAIRMAN ROKEBERG asked if the Human Resource Investment Council               
was administered by the DOL.                                                   
MR. PERKINS replied, "That is under the governor's office and they             
oversee the training programs, but that is not under the purview of            
the Alaska Department of Labor ...."                                           
Number 0695                                                                    
CHAIRMAN ROKEBERG questioned Representative Kohring whether HB 400             
affected the Human Resource Investment Council.                                
Number 0715                                                                    
MIKE KRIEBER, Legislative Administrative Assistant to                          
Representative Vic Kohring, came forward to testify.  He replied HB
400 does not do anything with the council except change the names              
of the commissioners to the new department.                                    
Number 0742                                                                    
CHAIRMAN ROKEBERG asked Mr. Perkins if the DOL had any job training            
MR. PERKINS responded that the department did not.  He clarified               
the department did not do job training, it put people to work.  He             
said DOL is the "dispatcher" getting requests from employers and               
providing qualified applicants to those employers.  Mr. Perkins                
stated these other programs are about job training.                            
Number 0770                                                                    
CHAIRMAN ROKEBERG noted JTPA was under DCRA, but he questioned                 
whether there were other job training programs in the Department of            
Health and Social Services (H&SS).                                             
Number 0780                                                                    
MR. PERKINS responded that was getting outside his realm of                    
expertise, noting he thought there might be some job training                  
associated with the Division of Public Assistance but he was not               
Number 0797                                                                    
CHAIRMAN ROKEBERG indicated he thought there were job training                 
programs related to monies from unemployment compensation funds                
(indisc.) surcharge tax.                                                       
Number 0818                                                                    
MR. PERKINS said he believed Chairman Rokeberg was referring to the            
State Training Employment Program (STEP) which he said will sunset             
this year, noting there is legislation that will hopefully be seen.            
He stated the department's role in that program is to collect the              
funds the employer sends in on employment security tax and transfer            
those funds to DCRA for distribution to training programs.                     
Number 0845                                                                    
CHAIRMAN ROKEBERG confirmed that program was administered by DCRA.             
He asked if it was under JTPA.                                                 
Number 0853                                                                    
MR. PERKINS answered in the negative, stating it was a separate                
Number 0887                                                                    
REPRESENTATIVE RYAN asked where and to whom DCRA distributed that              
Number 0900                                                                    
MR. PERKINS asked which type of money Representative Ryan was                  
referring to.                                                                  
Number 0903                                                                    
REPRESENTATIVE RYAN clarified he was referring to the employment               
security tax money collected by DCRA and transferred to DCRA.                  
Number 0907                                                                    
MR. PERKINS explained that was through the STEP Program.  He noted             
the program is up for sunset review this year and that there is                
legislation which would extend it.  He said .1 percent of the                  
unemployment tax from working Alaskans goes into a fund for job                
training.  He indicated Alaskans who have had a direct connection              
to the workforce within the previous three years qualify to receive            
these funds for employment training.  However, Mr. Perkins                     
indicated, that is all administered through the private industry               
councils, the vocational education technical schools, and labor                
organizations who qualify for those funds to train these                       
individuals, upgrading their skills.                                           
Number 0963                                                                    
REPRESENTATIVE RYAN indicated he would like to look into that bill             
when it came up.                                                               
Number 0969                                                                    
MR. PERKINS noted he would be happy to discuss it further if                   
Representative Ryan wished.                                                    
Number 0978                                                                    
CHAIRMAN ROKEBERG commented the committee was disappointed to see              
the DOL was not in the job training program.                                   
Number 0997                                                                    
SUSAN RODEHEAVER testified via teleconference from Kodiak.  She                
stated, "I have been a Kodiak "representative" for 26 years.  ...              
I have been aware of the Head Start Program for many years, but                
only recently become involved.  I have a 3 1/2 year old daughter in            
(indisc.) home-based program.  I am calling in concern to ... House            
Bill 400.  I feel that consolidating these two departments is not              
the solution.  The DCRA works with community-based development                 
along with Head Start, nurturing all aspects of family life, not               
just education.  Head Start's goal is to support the family with               
physical, mental and emotional support to keep our children health             
and safe.  The DCED supports the community with job-training                   
programs and works to maintain fair and consistent business                    
regulations.  Let's compare the departments saying, as an old                  
fashioned married couple, with the husband contributing to                     
financial support while the wife takes care of the household                   
engineering department.  Suddenly the husband dies, leaving the                
wife totally responsible for financial and household tasks.  The               
wife has to do it, but the end result lacks the same quality and               
efficiency obtained when both did their separate jobs.  The DCRA               
and the DCED support each other, they have the same goal of                    
improving the community life but have different methods of reaching            
this goal.  ... The DCRA provides physical, mental and emotional               
support for families; the DCED provides job training programs.                 
Both of these departments are needed, if we try to heap the                    
responsibility on one department, the workload will become too                 
heavy and the important tasks will be shuffled aside.  The                     
Department of Commerce and Rural Development may not have much                 
responsibility, but what about the Department of Health and Social             
Services to which day care assistance and Head Start will be                   
shifted, and the Department of Labor to which the job training                 
program [JTPA] will be added.  How would these departments bear up             
under the extra load?  Will more employees be hired for those                  
departments, in the end not saving any money on labor costs?  We               
are considering our children's future with this bill, so my                    
question is, why should we change the system that works so                     
successfully on the possibility that we may save money?"                       
Number 1138                                                                    
ROBERT HALL had to leave the Matanuska-Susitna Legislative                     
Information Office (Mat-Su LIO) before he was able to testify.  He             
left his testimony with Mr. Gifford.                                           
Number 1159                                                                    
DAN GIFFORD testified next via teleconference from the Mat-Su LIO.             
He read Mr. Hall's handwritten statement supporting HB 400 to the              
committee.  Mr. Gifford mentioned at various times that parts of               
Mr. Hall's statement were unreadable or difficult to make out.                 
     HB 400 represents a wonderful opportunity for the                         
     legislature to make a statement government is important                   
     to the people of Alaska.  In these days of diminishing                    
     revenues the legislature has a clear option of protecting                 
     constituencies that support big, ineffective government                   
     and cut programs that help citizens, or you can reduce                    
     upper-level bureaucracy, rearrange government to more                     
     efficiently and effectively deliver services and programs                 
     which, in this case, would result in protecting $1                        
     million worth of programs that have a clear benefit to                    
     the people.  The Department of Commerce and DCRA are                      
     ideal candidates for this merger.  In the days when the                   
     state had large revenues, this was a luxury the states                    
     could afford.  No longer can any state (indisc.) agency                   
     stand on its own merits of whether or not it is a good                    
     idea.  In the absence of budget cutting and budget                        
     deficits, legislatures must make tough comparative                        
     decisions.  How does protecting entrenched bureaucracy                    
     compare to cutting funding for the actual programs?  When                 
     any legislative effort suggests reducing funding, there                   
     is always opposition from those affected.  In this case,                  
     the upper-level bureaucracy may make an impassioned plea                  
     to protect their camp.  As legislators, you're (indisc.--                 
sentence).  Good government is not glamorous.  The people of Alaska            
has an interesting view.  We have good, dedicated state employees              
that are hamstrung by a (indisc.) bureaucracy.  The view point of              
"it's not broke, don't fix it" ignores the benefits of efficient               
and effective government.  Yet, HB 400 delivers better services but            
allows other programs the financial freedom not to be cut.  This               
bill, in some small way, also allows the "legislator" to restore               
credibility to state government.                                               
Number 1364                                                                    
CHAIRMAN ROKEBERG noted to Mr. Gifford that the committee would be             
happy to have a typed copy of Mr. Hall's testimony for the written             
public record.                                                                 
Number 1386                                                                    
MR. GIFFORD said he would contact Mr. Hall about this, and he                  
continued with his own testimony.  Mr. Gifford said HB 400 looked              
like a very good bill from his limited amount of research.  There              
might be some structural problems which might need to be addressed,            
but, overall, he thought that combining DCED and DCRA would be a               
very good thing since there was duplication in the areas of rural              
economic development; rural small business development and                     
fisheries; rural tourism; infrastructure scoping, planning and                 
funding; rural sanitation projects and funding; energy development;            
electrical utility assistance; and also assistance to economically-            
distressed regions.  He noted these were all duplications that                 
could be put into one agency, and, from just doing some rough math,            
he understands that would save at least $1 million a year by                   
cutting upper management.  Mr. Gifford said it would still be                  
manageable for one commissioner, indicating the new department                 
would have less than 500 people and he thinks there are several                
departments in state government larger than that.  He commented the            
benefit was that programs would not have to be cut, and perhaps                
even more money might be made available for those same programs.               
He said HB 400 seems to simply streamline government and make it               
more efficient.                                                                
Number 1487                                                                    
MR. GIFFORD noted dropping oil prices, revenue and oil production              
on the North Slope.  He said if things went badly for oil prices,              
and other things, state agencies might have to cut services and                
positions in a "meat-axe" type of way.  It made more sense to him              
to economize in an orderly, slow, careful way, to say nothing of               
what it might do to Alaska citizens depending on those programs for            
assistance.  Mr. Gifford indicated HB 400 would be advantageous to             
rural development in the DCRA if rural development was in the same             
department with DCED which currently handles most of the funding               
processing.  He noted it would make a lot of sense to have that                
money available in the same department, indicating this would tend             
to streamline things and make them work better.  Mr. Gifford stated            
he had a question for Mr. Perkins from the DOL, "I was under the               
impression that this basically keeps JTPA right where it is with               
the Department of Labor, or either adds the Department of Labor to             
- to do this, and I'm - I'm a little mystified as what the problem             
is, because I just read over Section 65 and it quite clearly states            
that the Department of Labor runs JTPA ...."  Mr. Gifford noted                
that concluded his testimony.                                                  
Number 1584                                                                    
REPRESENTATIVE COWDERY indicated he had asked Commissioner Irwin               
from DCRA at the February 23 hearing if he would possibly take a               
cut in pay to come into the new department and help with the                   
transition.  Representative Cowdery said he thought the                        
commissioner had stated there was no one in the other department               
who could do what Commissioner Irwin was doing.  Representative                
Cowdery said the impression he received was that the commissioner              
would not be interested in any salary cut to assist with this                  
consolidation.  Representative Cowdery stated that was what he                 
thought this bill was about:  management and this consolidation.               
He stated he would hope that both departments would give and take              
a little bit to end up with what was best for the public, noting               
that was more or less an editorial comment and he had only been                
present for part of that previous meeting.                                     
Number 1650                                                                    
CHAIRMAN ROKEBERG stated the committee would go back to testimony              
in Juneau.                                                                     
Number 1664                                                                    
FRED JAMES came forward to testify in Juneau.  He said he                      
completely supported HB 400, with one interesting qualification.               
Mr. James said it was a wonderful bill, he thinks it was consistent            
with the reason most of the Republicans were placed in office in               
1994 all over the country, which he said was the just cry to cut               
government.  He stated government was too big and bloated and they             
needed to get rid of some of it, and in many peoples' opinions, a              
lot of it.  Mr. James commented that, while this process of cutting            
$50 or $60 million a year has been slow, he understood from gossip             
that the incentive to cut was being "piddled away" this year                   
because of the prospect of the election.  He commented that,                   
therefore, HB 400 was excellent because it gave them a means of                
trimming and didn't remove any of the services provided.  He said              
he really liked the bill and noted it was because of two deep                  
impressions he received as a younger man.  The first was an example            
of government waste he saw while doing his army basic training.  He            
watched a large amount of ammunition shot off for no purpose                   
because a second lieutenant was too lazy to go through the record-             
keeping to log the unshot ammunition.                                          
Number 1774                                                                    
MR. JAMES said his second deep impression was several years later              
at the University of Hawaii when he was studying economics.  He                
learned about the notion of "make do, make work" - the theoretical             
idea of one person digging holes and another one, always employed              
by the government, filling those holes up.  He said one digs, one              
fills, and it is photographed with the big show that this is taxes             
in action, and the fact that it is "make work" is concealed.  Mr.              
James said those two notions of "make-work" and government waste               
have stayed with him ever since, stating, "And as a taxpayer, I ...            
represent all notions of conserving what our treasure is, and                  
that's what this bill is all about, so I - I completely back it,               
with this exception.  And that is, that instead of moving, or ...              
taking all these little divisions within the departments, and the              
bill calls for them simply to remain in place and be administered              
by one commissioner instead of two.  Well the notion is noble, but             
I would think that it would be more proper to go further than that.            
We should not just move them, but we should think very seriously               
about cutting them, because some of them are very much like digging            
holes and then filling them up."                                               
Number 1842                                                                    
MR. JAMES indicated one of the ones he had in mind was the Division            
of Tourism, which he said takes government tax dollars, the                    
people's money, and gives it to one sector of the private economy              
instead of another.  He said the Division of Tourism was                       
functioning as a bank and he commented that the act of the                     
government giving out money to certain people for one reason or                
another, which a lot of these little departments did, was crowding             
out the proper function of banks and other private lending                     
institutions.  He indicated this was why bank rates went up.  Mr.              
James also noted a secondary reason was that when private people               
gave away money, they were more careful with it because they were              
profit-oriented.  He said the Division of Tourism could be phased-             
out and its management could find honest jobs in the private                   
sector.  He noted that then some of the complaints that were raised            
could be averted, commenting that the problem of computer                      
compatibility had been brought up.  Mr. James said that problem                
became nothing when compared to the "Y-2000" problem which every               
computer in the world was going to have to face in less than two               
years, and which, he said, would have to be solved first.  He                  
indicated this problem would be solved by someone in the private               
Number 1931                                                                    
MR. JAMES also referred to the complaint that certain buildings                
were ADA (Americans with Disabilities Act) incompatible.  He stated            
the solution was make the buildings compatible, using open                     
contracts so that it could be done efficiently.  He commented that             
another criticism had been that work would increase over a short               
time because of reorganization.  Mr. James said with the                       
abolishment of the Division of Tourism and the reduction of                    
"division of licensure" (Division of Occupational Licensing) by                
eliminating a number of businesses requiring licensure such as                 
"haircutting" and he used the analogy of getting government off the            
backs of the people, not as many bureaucrats would be needed to                
administer all these programs.  He commented he thought the                    
funniest complaint of all was about the full-time space organizer.             
He indicated that, because of the trimming, the deputies would have            
extra time, and said they should be assigned the task of                       
reorganizing the space, noting that if they cut and trim, there                
would be space to organize.                                                    
Number 2009                                                                    
CHAIRMAN ROKEBERG said he believed the testimony had been for two              
space planners.                                                                
Number 2013                                                                    
MR. JAMES said he thought Representative Kohring had been dead                 
right when he commented two days previously that the commissioners             
were like rabbits running scared in front of headlights.  Mr. James            
said he has seen it time and time again, indicating that all the               
testimony against HB 400 was from people were benefitting from the             
current system.  He said they were complaining that their "cushy"              
jobs were being cut, but they would get more productive jobs in the            
private sector.  Mr. James stated he would advise the committee to             
think about cutting whole agencies or whole departments or trimming            
others, noting they would have the everlasting thanks of many of               
the people.   He said the Governor's office, as Representative Ryan            
commented the other day, has been noncommittal about HB 400, and he            
said he would go further to say that it has been arrogant, noting              
that those on the "third floor" are supposed to be public servants.            
He indicated he suggests that the legislature, the people who make             
the rules, ought to be the ones who call the shots, and the                    
Governor's office ought to administer what the legislature sets up.            
Mr. James referred to a letter to the editor in the Anchorage Daily            
News, February 27, 1998, which was distributed to the committee,               
from a Palmer man, Jim Van Doren.  Mr. James quoted, "His                      
[Representative Kohring's] latest bill, HB 400, will consolidate               
two fat state government departments, get rid of their upper-                  
management hierarchies and deliver the same services for far less              
cost.  This should be music to our ears."  Mr. James noted it was              
music to his, he urged the committee to do it, and he congratulated            
Representative Kohring for bringing it up.                                     
Number 2123                                                                    
CHAIRMAN ROKEBERG asked if there were any questions for Mr. James.             
Number 2125                                                                    
REPRESENTATIVE COWDERY commented that Mr. James had obviously heard            
the testimony from the last hearing and he asked Mr. James if he               
thought the departments were motivated to get behind this proposal             
or motivated for their own salaries.  He noted Mr. James discussed             
reorganizations and the departments had talked about the                       
reorganization.  Representative Cowdery indicated he thinks the                
legislators do that every election and it seems to work out.  He               
asked Mr. James if he thought the department heads or the                      
departments were capable of making this merger, or did he think                
they were not motivated, or not interested.                                    
Number 2156                                                                    
MR. JAMES said he thought, from the comments made by the                       
departments, that they were protecting their (indisc.).  He said               
their bottom-line motivation was higher salaries and good, fat                 
retirements with benefits.  He indicated he couldn't say exactly               
what the members of the departments or department heads thought,               
but he could almost predict what they would say, noting he believed            
they were conjuring up every single reason they could think of to              
make it look as if HB 400 was impractical and would hurt people.               
He referred to the two female witnesses who testified against                  
moving the Head Start Program to H&SS.  He noted that, while                   
Representative Kohring did not want any changes, there might be                
some administrative changes which could be worked out in the                   
details.  He stated, "Already they're reading long prepared                    
documents, who - who do think ... gave them those documents?  They             
didn't think 'em up."  He noted he had prepared his own documents              
and stated he was saying this because that was the way he felt, and            
that was his political philosophy.  He said, "They're protecting               
themselves and we should see clearly that this is the case."                   
Number 2221                                                                    
CHAIRMAN ROKEBERG said there were two other witnesses signed up to             
testify, but he indicated the committee would pause the public                 
hearing on HB 400 in order to bring HB 458 back before the                     
HB 458 - GOLF COURSE BEER/WINE LICENSE                                         
Number 2236                                                                    
CHAIRMAN ROKEBERG indicated HB 458 was back before the committee.              
He stated he would entertain a motion on Version L, the proposed CS            
for HB 458 labeled 0-LS0507\L, Ford, dated 2/27/98.                            
Number 2243                                                                    
REPRESENTATIVE COWDERY made a motion to move Version L.                        
Number 2245                                                                    
CHAIRMAN ROKEBERG asked if there were any objections.  There being             
none, he stated CSHB 458(L&C) was so moved with the attached zero              
fiscal note and individual recommendations.                                    
HB 400 - DEPT OF COMMUNITY & ECONOMIC DEVELOPMENT                              
Number 2266                                                                    
CHAIRMAN ROKEBERG announced the committee would take HB 400 back               
up.  He noted Representative Kohring has been in attendance, and               
Pat Poland, Director, Division of Municipal and Regional                       
Assistance, DCRA, had been standing by for questions in Anchorage.             
Chairman Rokeberg called Mr. Ritchie forward, indicating the                   
committee had the Alaska Municipal League's February 25 letter.                
Number 2280                                                                    
KEVIN RITCHIE, Executive Director, Alaska Municipal League, came               
forward to testify in Juneau.  He noted the Alaska Municipal League            
was not a state agency.  He said it worked with municipalities,                
many of which did work with DCRA, noting a lot of what the league              
does is help with the same types of issues:  savings, efficiency.              
He indicated the league supported any effort toward efficiency in              
that direction, but it cautioned the committee members to carefully            
consider each one of the changes being recommended.  He said many              
of the members had obviously done things like this in private                  
business, noting it is  not always quite as straight forward as it             
seems.  Mr. Ritchie referred to the Alaska Municipal League's                  
letter which had been made available to the committee, and                     
indicated the league is concerned on behalf of its members because             
the Constitution of the State of Alaska mandates only one agency,              
a local government agency [Article X, Section 14 of the                        
Constitution of the State of Alaska reads:  "Local government                  
agency.  An agency shall be established by law in the executive                
branch of the state government to advise and assist local                      
governments.  It shall review their activities, collect and publish            
local government information, and perform other duties prescribed              
by law."].  Mr. Ritchie said, according to his reading, since there            
is only one agency mandated, the framers of the constitution felt              
it was an extremely important function of government, and would be             
in the long term.  He said the only point he would make about a                
local government agency was that government has become quite a bit             
more complicated than it used to be, and the need for an agency to             
provide advice and support to local governments is more and more               
important.  He commented on the need for support with federal                  
environmental rules, federal mandates of many kinds, state mandates            
and personnel law.  Mr. Ritchie suggested the committee talk to                
some of the people involved in the constitutional discussions of               
the necessity of a local government agency, noting that if this                
agency was set aside in a separate department as a sub-program, it             
was probably not going to get the same type of attention and                   
emphasis intended by the constitution.                                         
Number 2360                                                                    
REPRESENTATIVE COWDERY commented on the low price of oil, and                  
indicated that times for cut-backs come up, and this is such a                 
time.  He said the agencies the Alaska Municipal League deals with             
would still be in place and the composition of upper management                
really didn't matter, noting the league was more interested in the             
programs, and he didn't think the programs would be impacted in                
this change.  He said he had asked Representative Hudson how many              
departments had existed 20 or 25 years ago, noting there had been              
fewer.  Representative Cowdery said he hasn't done the research but            
he stated, "The departments have split up and went just the                    
opposite of what we're trying to do it back into one now.  And I -             
I, just a question, do you, I just -- if you could elaborate on why            
you think ..." [TESTIMONY INTERRUPTED BY TAPE CHANGE]                          
TAPE 98-21, SIDE A                                                             
Number 0001                                                                    
MR. RITCHIE stated, "... I used to - to be a city manager for a                
fairly large organization, and having gone through that exercise a             
number of times, some of the things that seem like they'll save                
money may not particularly save money."  He noted one example in               
the late 1970s, where the City and Borough of Juneau (CBJ) had been            
approached by a private management corporation who guaranteed the              
assembly the company could save the CBJ $1 million in its                      
organization.  Mr. Ritchie said the company did save $1 million in             
organization, coming back for $35,000 or $40,000 with a list of                
positions to eliminate, but he noted there were some significant               
impacts beyond that.  He said he would caution that it was a                   
difficult thing to do, but not that it couldn't be done.  In terms             
of whether or not the agency would be effective if made more of a              
sub-program, he said he could not say what would happen, but he                
noted that when a program was moved down the line in terms of                  
importance, it often received less organizational time.  He said               
the state constitution seemed to put a great deal of importance on             
a local government agency from a policy as well as a service                   
standpoint, by saying there was only one real, constitutionally-               
required agency, and this might be important for the committee to              
think about in its deliberations.                                              
Number 0153                                                                    
REPRESENTATIVE COWDERY noted he came from the private sector also.             
He referred to his company and the changes that were necessary as              
the economy changed.  Representative Cowdery said his company                  
hadn't been very large, at times it had made $10 million a year in             
the heydays.  Different sections had dealt with different                      
functions:  private houses, subdivision development, highway work.             
As the economy changed, he said it was necessary to merge these                
functions.  He noted his company still performed these functions,              
it did whatever it was competitive to do, but it had to merge to               
remain competitive.  He indicated he felt these were just necessary            
things that needed to be done.  Representative Cowdery commented               
that he had been working for the Municipality of Anchorage during              
the oil price collapse.  He said when Mayor Fink took over, the                
banks were failing, peoples' homes had depreciated, people couldn't            
afford to pay for them, and some were leaving the state.  However,             
Representative Cowdery said, it struck him most that the city                  
employees he worked with didn't know there was a problem because               
they were still getting paid.  He indicated he believed the                    
majority of employees in the two merged departments would "dig                 
their heels in," noting that when they cut back in the municipality            
they ended up with a better product, and served the public better.             
He said Representative Kohring's idea was not new, it had been                 
thought out a couple of years previously.  Representative Cowdery              
indicated it was time to make some hard decisions which might not              
be popular with everyone, recalling that some of the municipality              
employees had said they didn't really care about lay-offs because              
they were so far up on the seniority list.  He stated he really has            
strong feelings that this is proper, timely, and is something that             
should be done.                                                                
Number 0536                                                                    
CHAIRMAN ROKEBERG noted Mr. Ritchie's letter and testimony brought             
the committee's attention to Article X, Section 14, of the Alaska              
State Constitution.  Chairman Rokeberg commented that it only said             
"agency," not investing it with the importance of a department.  He            
asked Mr. Ritchie if he thought that if HB 400 passed, the                     
existence of an agency, not necessarily a division, within the                 
merged department would fulfill the constitutional mandate?                    
Number 0606                                                                    
MR. RITCHIE answered he believed they had a lot of latitude to                 
interpret what the constitution says, noting he is certain it has              
been done many times since its writing, and he thinks that agency              
may have been moved around quite a bit.  He stated the Alaska                  
Municipal League's point, and something that needed to be carefully            
considered, was that does this agency still do the types of things             
as well as or as envisioned by the framers of the constitution.  He            
indicated further research in this area might be worthwhile.                   
Number 0649                                                                    
CHAIRMAN ROKEBERG indicated the committee would look at the minutes            
of the constitutional convention.                                              
Number 0667                                                                    
REPRESENTATIVE RYAN noted there was an axiom in government that                
when departments were merged, the bigger one usually ate the little            
one.  He asked Mr. Ritchie if the composition of the municipal                 
league, and how it was funded, had changed in the past ten years               
since Representative Ryan had participated in it.  He noted the                
disparity in dues had been phenomenal, although each member had                
only one vote.  He said Fairbanks had been paying something like               
$50,000 a year while Fort Yukon was paying $250, noting the smaller            
communities were the majority.                                                 
Number 0720                                                                    
MR. RITCHIE indicated this was not still the case.                             
REPRESENTATIVE RYAN asked how the league was currently put                     
Number 0723                                                                    
MR. RITCHIE answered that the maximum dues paid by any organization            
were $37,000 and that the minimum dues have come up considerably               
for the smaller organizations.  He said his bosses were the ten                
regional representatives, noting it was much like the legislature              
with population as one of the key factors.  He commented that                  
Anchorage and Fairbanks both had their own seats.  Mr. Ritchie                 
indicated the key decisions on policy matters were made by the ten             
regional representatives, but he noted Representative Ryan was                 
correct in that the municipalities each received one vote, which,              
he said, is the same as the vast majority of other municipal                   
leagues in the United States.  He noted the reason for this is that            
municipal leagues, by their nature, have to be consensus                       
organizations.  He indicated that if an issue causes a significant             
split between any configuration of the municipalities, it would not            
really be an appropriate statewide issue to go forward with on a               
consensus opinion.                                                             
Number 0798                                                                    
CHAIRMAN ROKEBERG thanked Mr. Ritchie for his testimony, noting the            
committee would take testimony from one more witness in Valdez,                
thanking her for her patience.                                                 
Number 0834                                                                    
SYLVIA SULLIVAN, President, Alaskans for a Just Society, testified             
next via teleconference from Valdez.  She noted her patience ran               
out about an hour ago and commented that her testimony would be                
brief.  She asked how many legislators were present.                           
Number 0880                                                                    
CHAIRMAN ROKEBERG stated there were four House members present.  He            
said the committee had received Ms. Sullivan's 13-page faxed                   
statement and it had been distributed to the committee members.                
Number 0871                                                                    
MS. SULLIVAN noted the fiscal note on HB 400 had been requested and            
asked if it had been prepared.                                                 
Number 0880                                                                    
CHAIRMAN ROKEBERG replied that the committee had not received the              
fiscal note.                                                                   
Number 0898                                                                    
MS. SULLIVAN said she was not sure if the legislators had a chance             
to read her letter.  She stated she was a paralegal of 15 years,               
noting her statement consisted of a six-page letter and the                    
documentation she was referring to.  Ms. Sullivan stated HB 400 was            
unconstitutional and believed she proved that in her letter.  She              
said every piece of legislation must pass constitutional muster.               
Ms. Sullivan indicated the drafting attorney on HB 400 was Terri               
Lauterbach, and said her letter indicates she called Legislative               
Legal and Research Services to get the legal opinion on HB 400 but             
was refused.  She indicates she was told that Legislative Legal and            
Research Services were confidential, which Ms. Sullivan said was               
Number 0980                                                                    
CHAIRMAN ROKEBERG noted Ms. Sullivan said she would (indisc.) a                
legal opinion and he asked her what legal opinion she was talking              
Number 0989                                                                    
MS. SULLIVAN said she found it was interesting that so many                    
legislators did not know there was a drafting manual for both the              
drafting of regulations and the drafting of legislation.  Ms.                  
Sullivan stated that, in the process of drafting legislation and               
regulation, the attorneys at legal services are mandated by the                
constitution and the Alaska Supreme Court to have a check-off list             
to make sure that when they give legislation back to the                       
legislators it has passed constitutional muster, i.e. it is not                
illegal or unconstitutional.  She noted from her experience as a               
paralegal she could see in two minutes that HB 400 was both illegal            
and unconstitutional because:  1) there was one more than one                  
subject in this bill and a bill could not have more than subject;              
2) page 11 of HB 400 listed a brand-new program, a brand-new                   
Section.  She said it was a brand-new law and was not even noted in            
the title.   Ms. Sullivan said she stated in her letter that the               
reason the Alaska Supreme Court said the attorneys with legal                  
services had to check-off the conformance of every piece of                    
legislation was so no one would try to include something in                    
legislation that should not be there.  She noted that was illegal.             
Number 1096                                                                    
CHAIRMAN ROKEBERG said he appreciated Ms. Sullivan's criticisms of             
the legislative legal agency, noting many members might sometimes              
share a lot of her opinions, but, given the time constraints, he               
asked her to keep to the subject of the bill, not the drafting                 
Number 1120                                                                    
MS. SULLIVAN replied that if it is not legal, then it is invalid.              
Number 1125                                                                    
CHAIRMAN ROKEBERG noted it was a matter of opinion and he                      
appreciated her opinion, and asked her to speak to the bill on its             
Number 1133                                                                    
MS. SULLIVAN stated she wanted to update the committee, indicating             
she had received the two memorandums on HB 400 just before going to            
the LIO.  She noted that on both of these pages Ms. Lauterbach said            
she had not checked for legal or technical review of the bill.  Ms.            
Sullivan stated the top of the February 10 memorandum said,                    
"Enclosed is your new final, ready-for-introduction bill."  She                
indicated the Legislative Legal and Research Services attorneys are            
in trouble when they put a stamp of approval on the bill like that             
because they did not follow the mandate.   Ms. Sullivan stated her             
association is absolutely against this, commenting that it has been            
going on two years now.  She said what affects her association in              
particular is the business incentive training program, noting she              
indicated this in her letter and backed it up with the applicable              
federal law.  She indicated federal monies cannot be used for the              
state work and training programs if those people are assigned to               
employers for training work, on the job training, or any of the                
like, noting that 84,000 unemployed Alaskans need jobs.  She stated            
HB 400 was introduced so these employers could get free slave                  
labor, commenting that all the bill sponsors were business owners.             
Ms. Sullivan asked if Representatives Brice or Kubina were present.            
Number 1243                                                                    
CHAIRMAN ROKEBERG noted they were not there that day.                          
MS. SULLIVAN said they were the only two that were not in business,            
and she said her organization was taking this farther because they             
believed this was intentional fraud.                                           
Number 1261                                                                    
CHAIRMAN ROKEBERG interjected.  He stated HB 400 did not speak to              
any substantive changes in the law, noting those were already                  
existing laws.  He indicated HB 400 merged various elements of                 
government currently in statute now and it seemed she was straying             
from the title and subject matter of HB 400 because the merging of             
different functions was what was before the committee, not the                 
merits of that particular program.                                             
Number 1286                                                                    
MS. SULLIVAN asked for clarification on page 11, which said Section            
21 was amended by adding a new Section 3 and telling how a business            
incentive training program would be set up.                                    
Number 1302                                                                    
CHAIRMAN ROKEBERG noted that was in existing law and not before the            
committee in terms of its substance.                                           
Number 1308                                                                    
MS. SULLIVAN said the entire bill was before the committee.                    
Number 1303                                                                    
CHAIRMAN ROKEBERG replied that was true; he said that if the                   
committee chose to redraft any sections of the bill, it certainly              
would.  However, he noted that was not the intention of HB 400, nor            
was it the intention of committee to review every element of                   
existing statute as it related to the two departments; the purpose             
of this bill was to merge two departments and nothing else.                    
Number 1328                                                                    
MS. SULLIVAN stated that was not what the bill was doing and she               
commented that they would handle it from there, indicating she was             
sure a judge would agree.  She referred to the material she had                
provided and the drafting manual, indicating she believed the bill             
was totally illegal.                                                           
Number 1349                                                                    
CHAIRMAN ROKEBERG noted Representative Kohring had no closing                  
comments.  HB 400 was held over.                                               
Number 1354                                                                    
CHAIRMAN ROKEBERG adjourned the House Labor and Commerce Standing              
Committee meeting at 5:19 p.m.                                                 

Document Name Date/Time Subjects