Legislature(2021 - 2022)BARNES 124

04/27/2022 03:15 PM House LABOR & COMMERCE


Download Mp3. <- Right click and save file as

* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ HB 382 INSULIN COVERAGE:INSURANCE;MEDICAID TELECONFERENCED
<Bill Hearing Rescheduled to 04/29/22>
<Pending Referral>
+ SB 45 AGE FOR NICOTINE/E-CIG; TAX E-CIG. TELECONFERENCED
<Bill Hearing Canceled>
<Pending Referral>
+= HB 405 ESTABLISHMENT OF TRUSTS TELECONFERENCED
Heard & Held
-- Public Testimony --
+= HB 406 MORATORIUM ON TRUSTS/PROPERTY ACQUISITION TELECONFERENCED
Heard & Held
-- Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
+ SB 186 EXTEND BOARD OF EXAMINERS IN OPTOMETRY TELECONFERENCED
Heard & Held
<Bill Hearing Rescheduled from 04/25/22>
+ SB 190 REGULATORY COMMISSION AK/REFUSE UTILITIES TELECONFERENCED
Heard & Held
<Bill Hearing Rescheduled from 04/25/22>
+ SB 193 EXTEND BOARD OF CHIROPRACTIC EXAMINERS TELECONFERENCED
Heard & Held
<Bill Hearing Rescheduled from 04/25/22>
                    ALASKA STATE LEGISLATURE                                                                                  
          HOUSE LABOR AND COMMERCE STANDING COMMITTEE                                                                         
                         April 27, 2022                                                                                         
                           3:18 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Zack Fields, Co-Chair                                                                                            
Representative Ivy Spohnholz, Co-Chair                                                                                          
Representative Calvin Schrage                                                                                                   
Representative David Nelson                                                                                                     
Representative James Kaufman                                                                                                    
Representative Ken McCarty                                                                                                      
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Liz Snyder                                                                                                       
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
SENATE BILL NO. 186                                                                                                             
"An Act extending the termination  date of the Board of Examiners                                                               
in Optometry; and providing for an effective date."                                                                             
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
CS FOR SENATE BILL NO. 190(FIN)                                                                                                 
"An  Act  extending  the  termination   date  of  the  Regulatory                                                               
Commission  of  Alaska;  relating  to  Regulatory  Commission  of                                                               
Alaska regulations  regarding refuse  utilities; relating  to the                                                               
powers  and  duties  of  the   legislative  audit  division;  and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
CS FOR SENATE BILL NO. 193(FIN)                                                                                                 
"An  Act  extending   the  termination  date  of   the  Board  of                                                               
Chiropractic Examiners;  requiring a  report on  audit compliance                                                               
by  the Board  of Chiropractic  Examiners; and  providing for  an                                                               
effective date."                                                                                                                
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE BILL NO. 405                                                                                                              
"An Act  relating to the  establishment of trusts;  requiring the                                                               
filing  of certain  trust information;  and requiring  compliance                                                               
with a federal law."                                                                                                            
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE BILL NO. 406                                                                                                              
"An  Act relating  to the  validity of  trusts involving  persons                                                               
sanctioned by the  United States Department of  the Treasury; and                                                               
relating to the recording of  documents conveying land to persons                                                               
sanctioned by the United States Department of the Treasury."                                                                    
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE BILL NO. 382                                                                                                              
"An Act relating to insurance coverage for pharmacy services."                                                                  
                                                                                                                                
     - BILL HEARING CANCELED                                                                                                    
                                                                                                                                
COMMITTEE SUBSTITUTE FOR SENATE BILL NO. 45(FIN)                                                                                
"An Act raising  the minimum age to purchase,  sell, exchange, or                                                               
possess tobacco, a product containing  nicotine, or an electronic                                                               
smoking product; relating to selling  a tobacco product; relating                                                               
to  possession  of  tobacco,   electronic  smoking  products,  or                                                               
products containing nicotine  by a person under 21  years of age;                                                               
relating   to  the   definition   of   'nicotine';  relating   to                                                               
transporting  tobacco,  a  product  containing  nicotine,  or  an                                                               
electronic  smoking   product;  relating   to  the   taxation  of                                                               
electronic  smoking  products;  relating  to  electronic  smoking                                                               
products;  relating  to  the   marketing  of  electronic  smoking                                                               
products;  relating to  tobacco  products; and  providing for  an                                                               
effective date."                                                                                                                
                                                                                                                                
     - BILL HEARING CANCELED                                                                                                    
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: SB 186                                                                                                                  
SHORT TITLE: EXTEND BOARD OF EXAMINERS IN OPTOMETRY                                                                             
SPONSOR(s): SENATOR(s) STEVENS                                                                                                  
                                                                                                                                
02/09/22       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/09/22       (S)       L&C, FIN                                                                                               
03/07/22       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
03/07/22       (S)       Moved SB 186 Out of Committee                                                                          
03/07/22       (S)       MINUTE(L&C)                                                                                            
03/08/22       (S)       L&C RPT  3DP                                                                                           
03/08/22       (S)       DP: MICCICHE, GRAY-JACKSON, STEVENS                                                                    
03/21/22       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
03/21/22       (S)       Heard & Held                                                                                           
03/21/22       (S)       MINUTE(FIN)                                                                                            
03/23/22       (S)       FIN AT 1:00 PM SENATE FINANCE 532                                                                      
03/23/22       (S)       Moved SB 186 Out of Committee                                                                          
03/23/22       (S)       MINUTE(FIN)                                                                                            
03/25/22       (S)       FIN RPT  5DP                                                                                           
03/25/22       (S)       DP: STEDMAN, BISHOP, HOFFMAN, WILSON,                                                                  
                         WIELECHOWSKI                                                                                           
03/28/22       (S)       TRANSMITTED TO (H)                                                                                     
03/28/22       (S)       VERSION: SB 186                                                                                        
04/04/22       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/04/22       (H)       L&C, FIN                                                                                               
04/25/22       (H)       L&C AT 3:15 PM BARNES 124                                                                              
04/25/22       (H)       <Bill Hearing Postponed to 4/27/22>                                                                    
04/27/22       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: SB 190                                                                                                                  
SHORT TITLE: REGULATORY COMMISSION AK/REFUSE UTILITIES                                                                          
SPONSOR(s): SENATOR(s) MYERS                                                                                                    
                                                                                                                                
02/15/22       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/15/22       (S)       L&C, FIN                                                                                               
02/28/22       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
02/28/22       (S)       Heard & Held                                                                                           
02/28/22       (S)       MINUTE(L&C)                                                                                            
03/14/22       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
03/14/22       (S)       Moved CSSB 190(L&C) Out of Committee                                                                   
03/14/22       (S)       MINUTE(L&C)                                                                                            
03/15/22       (S)       L&C RPT CS  5DP SAME TITLE                                                                             
03/15/22       (S)       DP: COSTELLO, GRAY-JACKSON, STEVENS,                                                                   
                        MICCICHE, REVAK                                                                                         
03/21/22       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
03/21/22       (S)       Heard & Held                                                                                           
03/21/22       (S)       MINUTE(FIN)                                                                                            
03/23/22       (S)       FIN AT 1:00 PM SENATE FINANCE 532                                                                      
03/23/22       (S)       Heard & Held                                                                                           
03/23/22       (S)       MINUTE(FIN)                                                                                            
03/28/22       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
03/28/22       (S)       -- MEETING CANCELED --                                                                                 
03/30/22       (S)       FIN RPT CS  3NR 3DP  NEW TITLE                                                                         
03/30/22       (S)       DP: BISHOP, HOFFMAN, WIELECHOWSKI                                                                      
03/30/22       (S)       NR: STEDMAN, WILSON, OLSON                                                                             
03/30/22       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
03/30/22       (S)       Moved CSSB 190(FIN) Out of Committee                                                                   
03/30/22       (S)       MINUTE(FIN)                                                                                            
04/08/22       (S)       TRANSMITTED TO (H)                                                                                     
04/08/22       (S)       VERSION: CSSB 190(FIN)                                                                                 
04/09/22       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/09/22       (H)       L&C, FIN                                                                                               
04/25/22       (H)       L&C AT 3:15 PM BARNES 124                                                                              
04/25/22       (H)       <Bill Hearing Postponed to 4/27/22>                                                                    
04/27/22       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: SB 193                                                                                                                  
SHORT TITLE: EXTEND BOARD OF CHIROPRACTIC EXAMINERS                                                                             
SPONSOR(s): SENATOR(s) MICCICHE                                                                                                 
                                                                                                                                
02/15/22       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/15/22       (S)       L&C, FIN                                                                                               
02/28/22       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
02/28/22       (S)       Heard & Held                                                                                           
02/28/22       (S)       MINUTE(L&C)                                                                                            
03/21/22       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
03/21/22       (S)       Moved CSSB 193(L&C) Out of Committee                                                                   
03/21/22       (S)       MINUTE(L&C)                                                                                            
03/23/22       (S)       L&C RPT CS  4DP   NEW TITLE                                                                            
03/23/22       (S)       DP: COSTELLO, GRAY-JACKSON, STEVENS,                                                                   
                         MICCICHE                                                                                               
03/28/22       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
03/28/22       (S)       -- MEETING CANCELED --                                                                                 
03/30/22       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
03/30/22       (S)       Heard & Held                                                                                           
03/30/22       (S)       MINUTE(FIN)                                                                                            
04/05/22       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
04/05/22       (S)       Moved CSSB 193(FIN) Out of Committee                                                                   
04/05/22       (S)       MINUTE(FIN)                                                                                            
04/06/22       (S)       FIN RPT CS  5DP 2NR  NEW TITLE                                                                         
04/06/22       (S)       DP: BISHOP, HOFFMAN, WILSON, OLSON, VON                                                                
                         IMHOF                                                                                                  
04/06/22       (S)       NR: STEDMAN, WIELECHOWSKI                                                                              
04/08/22       (S)       TRANSMITTED TO (H)                                                                                     
04/08/22       (S)       VERSION: CSSB 193(FIN)                                                                                 
04/09/22       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/09/22       (H)       L&C, FIN                                                                                               
04/25/22       (H)       L&C AT 3:15 PM BARNES 124                                                                              
04/25/22       (H)       <Bill Hearing Postponed to 4/27/22>                                                                    
04/27/22       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: HB 405                                                                                                                  
SHORT TITLE: ESTABLISHMENT OF TRUSTS                                                                                            
SPONSOR(s): LABOR & COMMERCE                                                                                                    
                                                                                                                                
04/04/22       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/04/22       (H)       L&C                                                                                                    
04/08/22       (H)       L&C AT 9:00 AM BARNES 124                                                                              
04/08/22       (H)       -- MEETING CANCELED --                                                                                 
04/15/22       (H)       L&C AT 9:00 AM BARNES 124                                                                              
04/15/22       (H)       Heard & Held                                                                                           
04/15/22       (H)       MINUTE(L&C)                                                                                            
04/18/22       (H)       L&C AT 3:15 PM BARNES 124                                                                              
04/18/22       (H)       Heard & Held                                                                                           
04/18/22       (H)       MINUTE(L&C)                                                                                            
04/20/22       (H)       JUD REFERRAL ADDED AFTER L&C                                                                           
04/20/22       (H)       BILL REPRINTED                                                                                         
04/22/22       (H)       L&C AT 9:00 AM BARNES 124                                                                              
04/22/22       (H)       Heard & Held                                                                                           
04/22/22       (H)       MINUTE(L&C)                                                                                            
04/25/22       (H)       L&C AT 3:15 PM BARNES 124                                                                              
04/25/22       (H)       <Bill Hearing Postponed to 4/27/22>                                                                    
04/27/22       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
BILL: HB 406                                                                                                                  
SHORT TITLE: MORATORIUM ON TRUSTS/PROPERTY ACQUISITION                                                                          
SPONSOR(s): LABOR & COMMERCE                                                                                                    
                                                                                                                                
04/04/22       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/04/22       (H)       L&C                                                                                                    
04/08/22       (H)       L&C AT 9:00 AM BARNES 124                                                                              
04/08/22       (H)       -- MEETING CANCELED --                                                                                 
04/15/22       (H)       L&C AT 9:00 AM BARNES 124                                                                              
04/15/22       (H)       Heard & Held                                                                                           
04/15/22       (H)       MINUTE(L&C)                                                                                            
04/20/22       (H)       JUD REFERRAL ADDED AFTER L&C                                                                           
04/20/22       (H)       BILL REPRINTED                                                                                         
04/22/22       (H)       L&C AT 9:00 AM BARNES 124                                                                              
04/22/22       (H)       Heard & Held                                                                                           
04/22/22       (H)       MINUTE(L&C)                                                                                            
04/25/22       (H)       L&C AT 3:15 PM BARNES 124                                                                              
04/25/22       (H)       <Bill Hearing Postponed to 4/27/22>                                                                    
04/27/22       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
SENATOR GARY STEVENS                                                                                                            
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified as the prime sponsor of SB 186.                                                                
                                                                                                                                
KRIS CURTIS, CPA, CISA, Legislative Auditor                                                                                     
Division of Legislative Audit                                                                                                   
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Provided invited testimony on SB 186.                                                                    
                                                                                                                                
SARA CHAMBERS, Director                                                                                                         
Division of Corporations, Business and Professional Licensing                                                                   
Department of Commerce, Community, and Economic Development                                                                     
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Answered questions during the hearing on SB
186 and CSSB 193(FIN).                                                                                                          
                                                                                                                                
DAMIEN DELZER, OD, DipABO, Chair                                                                                                
Board of Examiners in Optometry                                                                                                 
Division of Corporations, Business and Professional Licensing                                                                   
Department of Commerce, Community, and Economic Development                                                                     
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT:  Provided invited testimony on SB 186.                                                                    
                                                                                                                                
JESSICA GIESEY, OD                                                                                                              
Alaska Eyecare Center                                                                                                           
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Provided invited testimony in support of SB
186.                                                                                                                            
                                                                                                                                
SENATOR ROBERT MYERS                                                                                                            
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified as the prime sponsor of CSSB
190(FIN).                                                                                                                       
                                                                                                                                
DAWSON MANN, Staff                                                                                                              
Senator Robert Myers                                                                                                            
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  On behalf of Senator Myers, prime sponsor,                                                               
provided the sectional analysis for CSSB 190(FIN).                                                                              
                                                                                                                                
KRIS CURTIS, CPA, CISA, Legislative Auditor                                                                                     
Division of Legislative Audit                                                                                                   
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Provided invited testimony during the                                                                    
hearing on CSSB 190(FIN) and CSSB 193(FIN).                                                                                     
                                                                                                                                
KEITH KURBER, Commissioner                                                                                                      
Regulatory Commission of Alaska                                                                                                 
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Answered questions during the hearing on                                                                 
CSSB 190(FIN).                                                                                                                  
                                                                                                                                
MADISON GOVIN, Staff                                                                                                            
Senator Peter Micciche                                                                                                          
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:    Presented  CSSB  193(FIN)  on  behalf  of                                                             
Senator Micciche, prime sponsor.                                                                                                
                                                                                                                                
CHRIS LAUER, Esq.                                                                                                               
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   During the  hearing on  HB 405 and  HB 406,                                                             
expressed his concerns with HB 405.                                                                                             
                                                                                                                                
MATTHEW BLATMACHR, President & CEO                                                                                              
Peak Trust Company                                                                                                              
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   During the  hearing on  HB 405 and  HB 406,                                                             
expressed his concern with the bills.                                                                                           
                                                                                                                                
ABIGAIL O'CONNOR, Esq.                                                                                                          
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   During the  hearing on  HB 405 and  HB 406,                                                             
testified in opposition to both bills.                                                                                          
                                                                                                                                
LINDA HULBERT                                                                                                                   
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT:   During the  hearing on  HB 405 and  HB 406,                                                             
testified in opposition to both bills.                                                                                          
                                                                                                                                
HARRY NEED                                                                                                                      
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   During the  hearing on  HB 405 and  HB 406,                                                             
testified in opposition to HB 405.                                                                                              
                                                                                                                                
STEPHEN GREER, Esq.                                                                                                             
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   During the  hearing on  HB 405 and  HB 406,                                                             
testified in opposition to both bills.                                                                                          
                                                                                                                                
JAMIE DELMAN, Esq.                                                                                                              
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   During the  hearing on  HB 405 and  HB 406,                                                             
testified in opposition to both bills.                                                                                          
                                                                                                                                
ROBERT SCHMIDT, Director                                                                                                        
Division of Banking and Securities                                                                                              
Department of Commerce, Community, and Economic Development                                                                     
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   During the  hearing on  HB 405 and  HB 406,                                                             
answered questions.                                                                                                             
                                                                                                                                
TRACY RENO, Chief of Examinations                                                                                               
Division of Banking and Securities                                                                                              
Department of Commerce, Community, and Economic Development                                                                     
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   During the  hearing on  HB 405 and  HB 406,                                                             
answered a question.                                                                                                            
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
3:18:47 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  ZACK  FIELDS  called   the  House  Labor  and  Commerce                                                             
Standing   Committee    meeting   to    order   at    3:18   p.m.                                                               
Representatives Schrage,  McCarty, Nelson, Spohnholz,  and Fields                                                               
were  present  at the  call  to  order.   Representative  Kaufman                                                               
arrived as the meeting was in progress.                                                                                         
                                                                                                                                
         SB 186-EXTEND BOARD OF EXAMINERS IN OPTOMETRY                                                                      
                                                                                                                                
3:19:12 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS announced that the  first order of business would                                                               
be SENATE  BILL NO. 186,  "An Act extending the  termination date                                                               
of  the Board  of Examiners  in Optometry;  and providing  for an                                                               
effective date."                                                                                                                
                                                                                                                                
3:19:25 PM                                                                                                                    
                                                                                                                                
SENATOR  GARY STEVENS,  Alaska State  Legislature,  as the  prime                                                               
sponsor, presented SB  186 and urged that the  Board of Examiners                                                               
in Optometry  be extended.   He stated that  optometrists provide                                                               
most  of the  eye care  to patients  across Alaska,  plus an  in-                                                               
person examination by a Doctor  of Optometry is recognized as the                                                               
standard for ensuring  healthy vision.  He pointed  out that over                                                               
270 serious health conditions can  be detected through eye exams,                                                               
including  diabetes, high  blood  pressure, autoimmune  diseases,                                                               
and cancers.   The Board  of Examiners in Optometry  is essential                                                               
to the  practice of  optometry in  Alaska, he  continued.   It is                                                               
self-funded and  is the  regulatory body  that helps  protect the                                                               
public by implementing standards  of care, ongoing education, and                                                               
training  in the  field of  optometry.   The board,  he reported,                                                               
received an  overall favorable  audit indicating  its work  is an                                                               
important public service.                                                                                                       
                                                                                                                                
3:21:16 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS opened invited testimony on SB 186.                                                                             
                                                                                                                                
3:21:29 PM                                                                                                                    
                                                                                                                                
KRIS  CURTIS,   CPA,  CISA,  Legislative  Auditor,   Division  of                                                               
Legislative Audit,  provided invited  testimony on  SB 186.   She                                                               
spoke  from the  written  audit report  in  the committee  packet                                                               
titled  "A   Sunset  Review  of   the  Department   of  Commerce,                                                               
Community,  and  Economic  Development,  Board  of  Examiners  in                                                               
Optometry (board)," dated 6/9/21.   She stated that, overall, the                                                               
audit  concluded  [pages  5-8  of the  report]  that  this  board                                                               
conducted it meetings in compliance  with state laws, effectively                                                               
licensed  optometrists,  and   actively  amended  regulations  to                                                               
address  statutory changes  and improve  the licensing  function.                                                               
However, she  specified, the audit  also found that  the Division                                                               
of  Corporations,  Business  and Professional  Licensing  (DCBPL)                                                               
staff did  not serve  the public's  interest by  not consistently                                                               
recording  the   existence  of   a  [federal]   Drug  Enforcement                                                               
Administration  (DEA)  number  in  the  DCBPL  database,  by  not                                                               
ensuring continuing  education audits were conducted  timely, and                                                               
by   not  monitoring   licensees'   compliance  with   continuing                                                               
education in pain management and  opioid use and addictions.  Ms.                                                               
Curtis  said the  division is  therefore recommending  a six-year                                                               
extension  for this  board, two  years less  than the  eight-year                                                               
maximum  allowed  under statute,  reflecting  the  need for  more                                                               
timely oversight given the audit findings.                                                                                      
                                                                                                                                
MS. CURTIS  drew attention  to page  9 [Exhibit  2] of  the audit                                                               
report and  noted that  as of [1/31/21]  there were  218 licensed                                                               
optometrists,  an  18 percent  increase  since  the board's  last                                                               
sunset  date  of 2013.    She  then  drew  attention to  page  10                                                               
[Exhibit  3]  depicting  the board's  schedule  of  revenues  and                                                               
expenditures and  discussed the board's deficit  of approximately                                                               
$52,000 as  of 1/31/21.  She  said a fee increase  recommended in                                                               
April 2020  was not made due  to the governor's direction  not to                                                               
increase the  fees of  occupational boards  to help  mitigate the                                                               
financial impact of the COVID-19 pandemic.                                                                                      
                                                                                                                                
MS. CURTIS reviewed  the audit recommendations on  pages 13-15 of                                                               
the  audit report.   The  first recommendation,  she related,  is                                                               
that the  DCBPL director  dedicate resources  to ensure  that the                                                               
existence of a  DEA license number is accurately  reported in the                                                               
DCBPL database.   This information,  she explained,  is important                                                               
to  allow electronic  crossmatch  with  the controlled  substance                                                               
prescription  database to  monitor  the  requirement to  register                                                               
with the controlled substance prescription  database.  Staff were                                                               
provided instructions on  how to do this, she noted,  but did not                                                               
follow  the instructions.   According  to  DCBPL management,  she                                                               
continued,  regular turnover  in the  board's licensing  examiner                                                               
and  supervisor positions  contributed  to this.    She said  the                                                               
second recommendation is that the  board chair and DCBPL director                                                               
should  change the  license renewal  form to  allow the  board to                                                               
monitor  compliance with  continuing education  requirements.   A                                                               
change effective July 2018, she  explained, required licensees to                                                               
obtain two hours  of continuing education in  pain management and                                                               
opioid use  and addiction.   This change  was two years  prior to                                                               
license  renewal,  but  auditors  found that  the  December  2020                                                               
license  renewal form  was not  changed to  require licensees  to                                                               
report  compliance   with  this  new  requirement.     The  third                                                               
recommendation,  Ms.  Curtis  stated, is  that  DCBPL's  director                                                               
should  ensure  adequate  resources   are  available  to  perform                                                               
continuing education  audits.  These  audits, she  explained, are                                                               
DCBPL's  main internal  control to  ensure that  licensees comply                                                               
with continuing education requirements.   The audit found that it                                                               
took two  and a half  years to complete the  continuing education                                                               
audits that  were due during the  audit period, which was  due to                                                               
multiple licensing staff vacancies and turnover.                                                                                
                                                                                                                                
MS. CURTIS concluded  with a review of  the management's response                                                               
to the  audit on  pages 25-27  of the audit  report.   She stated                                                               
that  the DCBPL  commissioner  concurs with  the conclusions  and                                                               
recommendations.    She  said the  commissioner  noted  that  the                                                               
licensing examiner for  this board turned over  five times during                                                               
the  three-and-a-half-year   audit  period  and   the  supervisor                                                               
position  turned over  four  times.   That  turnover, Ms.  Curtis                                                               
added, contributed  to all  the findings.   She related  that the                                                               
board  chair's  response  states  that the  deficiencies  in  the                                                               
application  of the  renewal form  will be  corrected before  the                                                               
next renewal cycle.                                                                                                             
                                                                                                                                
3:25:34 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  SPOHNHOLZ inquired  about the  reason for  the staffing                                                               
turnover.                                                                                                                       
                                                                                                                                
MS. CURTIS replied that she doesn't recall a reason.                                                                            
                                                                                                                                
CO-CHAIR  SPOHNHOLZ remarked  that it  is a  significant turnover                                                               
occurring  on  a routine  basis  and  it undermines  the  board's                                                               
ability to function.   She stated that for  some licensing boards                                                               
the salaries are defined in  statute, but she doesn't remember if                                                               
this is one of those boards.                                                                                                    
                                                                                                                                
MS. CURTIS deferred to the DCBPL director to provide an answer.                                                                 
                                                                                                                                
3:26:11 PM                                                                                                                    
                                                                                                                                
SARA CHAMBERS,  Director, Division of Corporations,  Business and                                                               
Professional   Licensing   (DCBPL),   Department   of   Commerce,                                                               
Community, and Economic Development  (DCCED), answered that DCBPL                                                               
regularly  has  turnover  as  well   as  challenges  in  adequate                                                               
resourcing.    She explained  that  this  position is  especially                                                               
difficult because  the Board of  Examiners in Optometry  does not                                                               
warrant the workload of a  full position control number (PCN), so                                                               
it  is a  part of  a PCN  and, as  part of  a PCN,  this position                                                               
sometimes  gets moved  around.   However, she  explained further,                                                               
the  work this  examiner does  is deep,  so the  audit, which  is                                                               
complex in  some of the  statutory compliance  elements, requires                                                               
supervisory oversight.   The  day-to-day work  for this  board is                                                               
not especially challenging but when  routine issues come up, like                                                               
renewal and audits every two  years, then more hands-on is needed                                                               
and those things require more  institutional memory and training.                                                               
This is endemic to some of  the challenges that the committee has                                                               
been talking  about with the  division, Ms. Chambers added.   She                                                               
further advised  that these are  classified positions  as opposed                                                               
to established in statute.                                                                                                      
                                                                                                                                
3:28:08 PM                                                                                                                    
                                                                                                                                
CO-CHAIR SPOHNHOLZ  asked what the  [division] is planning  to do                                                               
to ensure that the issue is  not experienced again in another six                                                               
years if the sunset extension is approved as proposed in SB 186.                                                                
                                                                                                                                
MS. CHAMBERS responded that, except  for the audit, the first two                                                               
findings  were related  to the  new prescription  drug monitoring                                                               
program (PDMP) legislation.  She  explained that DEA registration                                                               
and  opioid education  were new  statutes  being implemented  for                                                               
this board  at this  moment for  the first  time; those  will not                                                               
come  up again  because that  work has  already been  done.   She                                                               
related that  the division has  now put into place  several steps                                                               
to have a fail-safe with  continuing education audit training and                                                               
calendaring.  She said oversight  by the division's paralegal has                                                               
been added  to ensure that  in addition to the  supervisor, there                                                               
are eyes on this program's audits  as well as all program audits.                                                               
So, she advised, all these findings have been resolved.                                                                         
                                                                                                                                
CO-CHAIR  SPOHNHOLZ recalled  legislation in  2018 that  expanded                                                               
the  legal  scope  of  optometrists to  be  consistent  with  the                                                               
training  of  optometrists.    She  asked  whether  adopting  the                                                               
regulations to implement that legislation was part of the issue.                                                                
                                                                                                                                
MS.  CHAMBERS replied  that  the  board has  not  had any  issues                                                               
implementing  the elements  of that  law.   The  findings of  the                                                               
audit, she  explained, are  administrative oversight  or problems                                                               
that are the responsibility of  the division rather than concerns                                                               
over  scope  of practice  or  elements  that  the board  is  held                                                               
responsible for, so they are not at all related.                                                                                
                                                                                                                                
3:31:11 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MCCARTY  inquired whether licensees were  asked to                                                               
engage  a DEA  number.   He further  inquired whether  a biennial                                                               
license is done online and, if  so, whether there is room for the                                                               
licensee to provide a DEA  number along with other information to                                                               
expedite the process for the division.                                                                                          
                                                                                                                                
MS. CHAMBERS  answered that the  problem relevant to  DEA numbers                                                               
was  that the  division  had to  make changes  to  its system  to                                                               
accommodate and implement the new PDMP  law.  The division had to                                                               
change its procedures  in the database, she  continued, and while                                                               
DCBPL  had  published  instructions and  supervisors  had  issued                                                               
instructions to examiners, the examiner  did not make that change                                                               
and the old  way was not sufficient to meet  the new standards of                                                               
the PDMP.  The DEA information  was being collected but was being                                                               
deposited in a different part of  the database which made it hard                                                               
to reconcile.  That has been rectified, she specified.                                                                          
                                                                                                                                
REPRESENTATIVE MCCARTY  restated his  question about  the ability                                                               
to renew  a license online  and whether the licensee  can provide                                                               
the information in  a manner that expedites going  into the state                                                               
system and  bypasses the examiner  having to manually  enter that                                                               
information.                                                                                                                    
                                                                                                                                
MS. CHAMBERS  replied yes, the  division has online  renewals for                                                               
all 43 of its licensing programs, and this would be included.                                                                   
                                                                                                                                
REPRESENTATIVE MCCARTY  asked whether  the DEA  number is  in the                                                               
online request or must still be added to that.                                                                                  
                                                                                                                                
MS. CHAMBERS  responded that the  DEA number is collected  in the                                                               
initial  application,  but she  doesn't  recall  whether the  DEA                                                               
number must be asked for again  at renewal.  She said she doesn't                                                               
think DEA  numbers change, but  if it was  required to be  on the                                                               
renewal   the  online   application   would   mirror  the   paper                                                               
application, so  all the questions  about opioid  education, DEA,                                                               
prescribing, and dispensing would be  online as well as on paper.                                                               
The  online would  make  it  more efficient  to  enter that  data                                                               
automatically.                                                                                                                  
                                                                                                                                
REPRESENTATIVE MCCARTY  asked whether this could  be expedited by                                                               
removing the paper  process and making it all online  so that the                                                               
licensee would be doing everything, so  less load on staff to re-                                                               
enter things.                                                                                                                   
                                                                                                                                
MS. CHAMBERS responded that the  division is currently working on                                                               
technology improvements to automate more  of what the division is                                                               
providing to its consumers and put  that more in the hands of the                                                               
applicant so it would bypass manual  data entry.  The division is                                                               
looking forward to  implementing that type of  technology for all                                                               
its programs, she said.                                                                                                         
                                                                                                                                
3:35:41 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS [continued] invited testimony.                                                                                  
                                                                                                                                
3:35:50 PM                                                                                                                    
                                                                                                                                
DAMIEN  DELZER,   OD,  DipABO,  Chair,  Board   of  Examiners  in                                                               
Optometry,  Division of  Corporations, Business  and Professional                                                               
Licensing  (DCBPL),   Department  of  Commerce,   Community,  and                                                               
Economic Development  (DCCED), provided  invited testimony  on SB
186.  He  stated he has practiced optometry in  Alaska for nearly                                                               
29 years and has served eight  years on the Board of Examiners in                                                               
Optometry, serving as chair for the last three.                                                                                 
                                                                                                                                
DR. DELZER  explained that the  board is charged  with commission                                                               
of public protection through vetting  of new applicants, assuring                                                               
appropriate  continuing   competency  of   licensees,  addressing                                                               
inquiries  from the  public,  investigating  any complaints,  and                                                               
crafting  and  enforcing  regulations  to  implement  legislative                                                               
statutory  change.   The board  implemented nearly  20 regulatory                                                               
changes over the  past three years, he  related, including issues                                                               
such as continuing education  requirements like opioid education,                                                               
scope of  practice, military exemptions,  specialty designations,                                                               
modernizing   the  law   examination,  modernizing   prescription                                                               
requirements,  and  modifying  emergency  regulation  during  the                                                               
recent COVID-19 pandemic.                                                                                                       
                                                                                                                                
DR.  DELZER noted  there have  been no  reported PDMP  violations                                                               
during his  eight years on the  board.  The board  is self-funded                                                               
through license  fees, he  said, and  board travel  expenses have                                                               
been minimized  through exclusive use  of Zoom meetings  over the                                                               
past three  years.   The board chair,  he added,  participates in                                                               
bi-weekly board chair meetings and bi-weekly PDMP meetings.                                                                     
                                                                                                                                
3:37:41 PM                                                                                                                    
                                                                                                                                
JESSICA  GIESEY,  OD,  Alaska Eyecare  Center,  provided  invited                                                               
testimony  in  support of  SB  186.    She  stated she  has  been                                                               
practicing optometry  in Alaska  for eight years.   She  said the                                                               
Board  of Examiners  in Optometry  is  vital to  the practice  of                                                               
optometry in  Alaska, acting  to protect  the public  by ensuring                                                               
that  only qualified  practitioners  are licensed  in Alaska  and                                                               
making  sure  that all  optometrists  licensed  in Alaska  follow                                                               
continuing  education  guidelines.   The  board,  she  continued,                                                               
regularly updates regulations ?  (indisc.   audio interruption)                                                                 
training from accredited schools and colleges of optometry.                                                                     
                                                                                                                                
3:38:36 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCARTY  asked  whether optometrists  are  having                                                               
difficulty getting their continuing  education units (CEUs) post-                                                               
COVID-19.                                                                                                                       
                                                                                                                                
DR. DELZER  replied that he  has not  seen any issues  with that.                                                               
After  the audit  findings, he  related,  a continuing  education                                                               
audit was  done in a very  timely manner, and it  does not appear                                                               
that anyone  is having difficulty finding  appropriate virtual or                                                               
live CEUs.                                                                                                                      
                                                                                                                                
[SB 186 was held over.]                                                                                                         
                                                                                                                                
         SB 190-REGULATORY COMMISSION AK/REFUSE UTILITIES                                                                   
                                                                                                                                
3:39:38 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS announced  that the next order  of business would                                                               
be  CS  FOR SENATE  BILL  NO.  190(FIN),  "An Act  extending  the                                                               
termination  date   of  the  Regulatory  Commission   of  Alaska;                                                               
relating   to  Regulatory   Commission   of  Alaska   regulations                                                               
regarding refuse utilities; relating to  the powers and duties of                                                               
the legislative  audit division;  and providing for  an effective                                                               
date."                                                                                                                          
                                                                                                                                
3:39:46 PM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease.                                                                                             
                                                                                                                                
3:40:24 PM                                                                                                                    
                                                                                                                                
SENATOR  ROBERT MYERS,  Alaska State  Legislature,  as the  prime                                                               
sponsor,  he  testified  that  CSSB  190(FIN)  would  extend  the                                                               
termination  date of  the Regulatory  Commission of  Alaska (RCA)                                                               
until  6/30/30,  in alignment  with  the  recommendations of  the                                                               
legislative  auditor.     He  explained   that  the  RCA   is  an                                                               
independent,  quasi-judicial   regulatory  body  formed   by  the                                                               
legislature  in  1999  to replace  the  Alaska  Public  Utilities                                                               
Commission.  The RCA, he  continued, monitors active certificates                                                               
for  public  utilities  and pipelines,  with  these  certificates                                                               
covering   a  broad   range   of   activities  from   provisional                                                               
certificates for  small village  water and wastewater  systems to                                                               
fully  regulated telecommunications,  electric,  and natural  gas                                                               
monopolies.    He noted  that  the  changes  made in  the  Senate                                                               
Finance Committee  were simple housekeeping  that he  supports as                                                               
they address  the refuse  utility backlog by  adding them  to the                                                               
simplified  rate  filing  procedure  and removing  an  extra  RCA                                                               
annual report  review process  on the  advice of  the legislative                                                               
auditor.                                                                                                                        
                                                                                                                                
3:41:58 PM                                                                                                                    
                                                                                                                                
DAWSON   MANN,  Staff,   Senator  Robert   Myers,  Alaska   State                                                               
Legislature, on behalf of Senator  Myers, prime sponsor, provided                                                               
the  sectional analysis  for CSSB  190(FIN).   He spoke  from the                                                               
written  sectional analysis  titled "SB  190 Ver.  W    Sectional                                                               
Analysis," which stated [original punctuation provided]:                                                                        
                                                                                                                                
     Section 1: Page 1, Lines 6-11                                                                                          
     This section  adds intent language that  the Regulatory                                                                    
     Commission of  Alaska shall adopt  regulations specific                                                                    
     to refuse  utilities to  provide for  sufficient public                                                                    
     notice and time for  ratepayers to meaningfully comment                                                                    
     on rate filings.                                                                                                           
                                                                                                                                
     Section 2:  AS 42.05.381(e)  Page 1, Lines  12-14, Page                                                                
     2, Lines 1-8                                                                                                             
     This section  amends AS 42.05.381(e) to  include refuse                                                                    
     utilities. AS  42.05.381(e) is the section  of law that                                                                    
     provides for a simplified rate filing procedure.                                                                           
                                                                                                                                
     Section 3: AS 44.66.010(a)(3) Page 2, Lines 9-11                                                                       
     This  section  extends  the termination  date  for  the                                                                    
     Regulatory Commission of Alaska until June 30, 2030.                                                                       
                                                                                                                                
     Section 4: AS 24.20.271(11) Page 2, Line 12                                                                            
     This  section repeals  AS 24.20.271(11),  a requirement                                                                    
     for the legislative audit division  to conduct an audit                                                                    
     every  two years  of information  found  in the  annual                                                                    
     reports   regarding   compliance  by   the   Regulatory                                                                    
     Commission of Alaska.                                                                                                      
                                                                                                                                
     Section [5]: Page 3, Line 13                                                                                           
     This section establishes an immediate effective date.                                                                      
                                                                                                                                
3:42:37 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS asked what prompted  the addition of the language                                                               
in Section 1 on page 1, lines 6-11.                                                                                             
                                                                                                                                
MR. MANN offered  his understanding that the  intent language was                                                               
added [in  the Senate Finance  Committee] to make clear  that the                                                               
RCA  was going  to adopt  internal rules  to make  sure there  is                                                               
public notice in  relation to refuse utilities as  per the change                                                               
made in Section 2.                                                                                                              
                                                                                                                                
MR. MANN returned to the  sectional analysis and pointed out that                                                               
the inclusion  of refuse utilities  in Section 2 was  an addition                                                               
made in  the Senate  Finance Committee.   He further  pointed out                                                               
that the repeal in Section 4  of the audit under AS 24.20.271(11)                                                               
was added  by the Senate  Finance Committee on  recommendation of                                                               
the legislative auditor.                                                                                                        
                                                                                                                                
3:44:59 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS  asked whether the  intent language  was prompted                                                               
by rates going up sharply somewhere in the state.                                                                               
                                                                                                                                
SENATOR MYERS  replied that this  is not due  to a jump  in waste                                                               
utility rates,  but rather  to waste  utilities trying  to expand                                                               
outside some  of their traditional  areas within city  limits but                                                               
the  regulations   have  not  been   allowing  them  to   do  so.                                                               
Currently,  he explained,  due  to the  way  waste utilities  are                                                               
regulated,  it takes  about two  years to  go through  the entire                                                               
process to update a utility's rates.   He deferred to the RCA and                                                               
the legislative auditor to expand further.                                                                                      
                                                                                                                                
3:46:01 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS opened invited testimony.                                                                                       
                                                                                                                                
3:46:25 PM                                                                                                                    
                                                                                                                                
KRIS  CURTIS,   CPA,  CISA,  Legislative  Auditor,   Division  of                                                               
Legislative Audit, provided invited  testimony during the hearing                                                               
on CSSB  190(FIN).  She  spoke from  the written audit  report in                                                               
the committee  packet titled "A  Sunset Review of  the Department                                                               
of  Commerce,  Community,  and Economic  Development,  Regulatory                                                               
Commission of Alaska (RCA)," dated  9/21/21.  [Referring to pages                                                               
3-4  of  the report],  she  said  the  audit concluded  that  RCA                                                               
operated in an effective manner  and served the public's interest                                                               
by:     assessing  the  capabilities  of   utility  and  pipeline                                                               
companies  to safely  serve the  public;  evaluating tariffs  and                                                               
charges made  by regulated  entities; verifying  the pass-through                                                               
charges  to consumers  from electric  and natural  gas utilities;                                                               
adjudicating disputes between  ratepayers and regulated entities;                                                               
providing consumer protection  services; and conducting financial                                                               
reviews  as part  of the  power cost  equalization program.   She                                                               
stated that  the division is  therefore recommending  the maximum                                                               
eight-year extension.                                                                                                           
                                                                                                                                
MS.  CURTIS discussed  the survey  conducted by  the division  as                                                               
part of the sunset audit (Appendix  B pages 19-20).  She said the                                                               
survey was sent  to 188 stakeholders that were party  to a docket                                                               
or a tariff  filing during the audit period,  with 59 responding.                                                               
She noted that  by far the responses to the  survey questions are                                                               
positive or  neutral, with  only a small  percent negative.   She                                                               
listed  the  four  questions  that  were  asked:    Overall,  how                                                               
satisfied are  you with the  following services provided  by RCA?                                                               
To  what extent  do  you  agree that  RCA  acts  in the  public's                                                               
interest?  Based on your experience,  how often does RCA meet its                                                               
statutory  timelines?    To  what extent  do you  agree that  RCA                                                               
effectively communicates?                                                                                                       
                                                                                                                                
MS. CURTIS returned to page 4 of  the audit report.  She said the                                                               
division  concluded  that  RCA  resolved  most  of  its  consumer                                                               
complaints  within its  internal,  non-statutory,  measure of  30                                                               
days.  To provide an idea  of the types of complaints received by                                                               
RCA, she drew attention to  the listing of consumer complaints in                                                               
Exhibit 3 on page 5.  She  revisited page 4 and said the division                                                               
also  concluded that  RCA processed  tariff  filings and  dockets                                                               
within the statutory and regulatory timelines.                                                                                  
                                                                                                                                
MS. CURTIS  turned to page 9  of the report and  pointed out that                                                               
the  audit  makes  one administrative  recommendation,  which  is                                                               
related to RCA's  monthly meetings.  Regulations  for RCA require                                                               
meetings twice  a month, she  said, but in instances  where there                                                               
are  no  agenda  items  RCA has  been  cancelling  the  meetings.                                                               
During  the  audit  period,  she  related,  25  of  88  scheduled                                                               
meetings were  cancelled, including six instances  where meetings                                                               
were consecutively  cancelled.  According to  RCA management, she                                                               
related, regulations  require the meetings, but  regulations also                                                               
allow RCA  to waive a  regulatory requirement by its  own motion.                                                               
Auditors confirmed that there is an  ability to waive but that it                                                               
must  be  an  official  motion,  she  continued,  so  these  were                                                               
cancelled without  official motion.   It is  certainly reasonable                                                               
to cancel  a meeting  when there  is nothing  on the  agenda, she                                                               
allowed, but it does not  explicitly comply with the regulations,                                                               
so this was brought to RCA's attention.                                                                                         
                                                                                                                                
MS.  CURTIS directed  attention to  pages 23-26  and stated  that                                                               
both  the  DCCED commissioner  and  the  RCA board  chairman  are                                                               
supportive of the eight-year extension.                                                                                         
                                                                                                                                
3:50:51 PM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease.                                                                                             
                                                                                                                                
3:50:57 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  FIELDS  requested  background  on  the  integration  of                                                               
expansion  of refuse  collection and  utility service  areas into                                                               
the bill.                                                                                                                       
                                                                                                                                
3:51:27 PM                                                                                                                    
                                                                                                                                
KEITH  KURBER,  Commissioner,  Regulatory  Commission  of  Alaska                                                               
(RCA),  responded that  two separate  issues were  brought up  by                                                               
Senator Myers.   Regulated and non-regulated  utilities require a                                                               
Certificate  of  Public  Convenience  and  Necessity  (CPCN),  he                                                               
explained, and  an expansion  of service  area is  typically done                                                               
through  amendment  of a  CPCN.    It  is  routine and  not  time                                                               
consuming,  he  stated,  the   commission  just  revalidates  the                                                               
utility's previously validated  fitness, willingness, and ability                                                               
to accomplish  its task.  He  said he doesn't know  what prompted                                                               
[the Senate  Finance Committee's]  change, but that  RCA Chairman                                                               
Picket stated  in his testimony on  the Senate side that  this is                                                               
not a  difficult task  for the commission  to re-do  a regulation                                                               
docket  to  assess and  modify  the  commission's regulations  to                                                               
allow  for simplified  rate  filing for  refuse  utilities.   Mr.                                                               
Kurber specified  that both full-blown rate  cases and simplified                                                               
rate  filings require  standard public  notice requirement,  with                                                               
timelines  typically  shorter  for simplified  rate  filings  and                                                               
hence  the term  simplified.    Quite a  bit  of  expense can  be                                                               
involved in doing  a full-blown rate case, he  noted, and smaller                                                               
utilities,  whether  electric  cooperatives  in  rural  areas  or                                                               
refuse  utilities, may  not  have the  staff to  do  some of  the                                                               
calculations necessary to  produce the final result.   He said he                                                               
therefore speculates that this could  be an assistance to some of                                                               
the smaller rate regulated refuse utilities.                                                                                    
                                                                                                                                
3:54:24 PM                                                                                                                    
                                                                                                                                
SENATOR MYERS  added that  refuse utilities,  for the  most part,                                                               
have  existed and  operated within  a  city -  the city  requires                                                               
residential  trash pickup,  so the  rates reflect  that basically                                                               
everybody is getting  trash pickup.  Refuse  utilities are trying                                                               
to  expand  outside  of  the  city limits,  he  explained.    For                                                               
example,  in Fairbanks  they are  trying to  expand north  of the                                                               
city  limits   and  pick  up   more  customers,   which  requires                                                               
experimenting with their  rates to make them work.   The problem,                                                               
he said,  is that  the current process  for altering  rates takes                                                               
about two years.   So, if the utility picks a  number that is too                                                               
high or too  low it takes a  long time for that to  get fixed and                                                               
creates  a  backlog within  the  RCA  to address  those  changes.                                                               
Hence,  he  continued, the  suggestion  was  made in  the  Senate                                                               
Finance  Committee to  put  it into  the  simplified rate  filing                                                               
process  so that  those changes  can  be addressed  within a  few                                                               
months rather than about two years.                                                                                             
                                                                                                                                
3:55:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCARTY  asked  whether this  [proposed]  process                                                               
will  allow for  people  in  the expanded  service  area to  have                                                               
feedback on whether they want to be part of a collection.                                                                       
                                                                                                                                
SENATOR MYERS  answered that  the proposed  new process  does not                                                               
require somebody  to be a  refuse customer, as opposed  to people                                                               
living within city limits being  required to sign up.  Simplified                                                               
rate filings still provide time  for public feedback as the rates                                                               
change, he explained, but because  the simplified rate process is                                                               
a shorter  time period there are  also limits as to  how much the                                                               
rate  can change  within  that  time period.    A refuse  utility                                                               
wanting a larger  change, he specified, would have  to go through                                                               
the original longer process.   In further response, Senator Myers                                                               
confirmed that  this would  not force people  to pay  a business,                                                               
they could choose to take their garbage to the dump themselves.                                                                 
                                                                                                                                
3:57:37 PM                                                                                                                    
                                                                                                                                
[CSSB 190(FIN) was held over.]                                                                                                  
                                                                                                                                
         SB 193-EXTEND BOARD OF CHIROPRACTIC EXAMINERS                                                                      
                                                                                                                                
3:57:42 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS announced  that the next order  of business would                                                               
be  CS  FOR SENATE  BILL  NO.  193(FIN),  "An Act  extending  the                                                               
termination  date   of  the  Board  of   Chiropractic  Examiners;                                                               
requiring  a  report   on  audit  compliance  by   the  Board  of                                                               
Chiropractic Examiners; and providing for an effective date."                                                                   
                                                                                                                                
3:58:00 PM                                                                                                                    
                                                                                                                                
MADISON  GOVIN,  Staff,  Senator  Peter  Micciche,  Alaska  State                                                               
Legislature,  presented  CSSB  193(FIN)   on  behalf  of  Senator                                                               
Micciche, prime sponsor.   She stated that the  bill would extend                                                               
the sunset date  for the Board of Chiropractic  Examiners by five                                                               
years, making  the new sunset 6/30/27.   She said the  bill would                                                               
also  require that  a  report from  the  Division of  Legislative                                                               
Audit be submitted to the  Legislative Budget and Audit Committee                                                               
on the board's compliance with this year's audit.                                                                               
                                                                                                                                
MS.  GOVIN explained  the changes  made  in CSSB  193(FIN).   She                                                               
spoke from  the document in  the committee packet  titled "Senate                                                               
Bill 193    Extend Board  of Chiropractic  Examiners, Explanation                                                               
of  Changes, Version  I  to Version  G,"  which stated  [original                                                               
punctuation provided]:                                                                                                          
                                                                                                                                
     Page 1, Line 2                                                                                                           
     Inserts  into the  title "requiring  a report  on audit                                                                    
     compliance by the Board of Chiropractic Examiners."                                                                        
                                                                                                                                
     Sec. 1  AS 08.03.010(c)(5) Page 1, Line 6                                                                                
     Extends  the board  extension from  two  years to  five                                                                    
     years.                                                                                                                     
                                                                                                                                
     Sec. 2  Page 1, Lines 8-14                                                                                               
     Adds a  requirement for the legislative  audit division                                                                    
     to  prepare and  submit to  the Legislative  Budget and                                                                    
     Audit  Committee  a report  on  the  compliance of  the                                                                    
     Board    of    Chiropractic    Examiners    with    the                                                                    
     recommendations  of  the June  22,  2021  audit of  the                                                                    
     board.                                                                                                                     
                                                                                                                                
3:59:23 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS opened invited testimony.                                                                                       
                                                                                                                                
3:59:52 PM                                                                                                                    
                                                                                                                                
KRIS  CURTIS,   CPA,  CISA,  Legislative  Auditor,   Division  of                                                               
Legislative Audit, provided invited  testimony during the hearing                                                               
on CSSB  193(FIN).  She spoke  from the full audit  report in the                                                               
committee packet  titled "DEPARTMENT OF COMMERCE,  COMMUNITY, AND                                                               
ECONOMIC  DEVELOPMENT  BOARD  OF  CHIROPRACTIC  EXAMINERS  SUNSET                                                               
REVIEW," dated 6/22/21.  She said  the audit found that the board                                                               
served  the  public's  interest by  conducting  its  meetings  in                                                               
accordance with  state laws, by  amending certain  regulations to                                                               
improve   the  chiropractic   profession,   and  by   effectively                                                               
regulating  and licensing  chiropractic  physicians.   The  audit                                                               
also found, she  continued, that one board member  did not comply                                                               
with  the   statutory  requirements  for  appointment   and  that                                                               
additional  resources  were  needed  to investigate  cases  in  a                                                               
timely  manner.    She  related that  a  five-year  extension  is                                                               
recommended  rather than  the eight-year  maximum allowed  for in                                                               
statute.   This  recommendation, she  explained, is  based on  an                                                               
issue identified  during the  audit that  may impact  the board's                                                               
ability to protect the public,  details of which are not included                                                               
in the public audit report  to preserve the confidentiality of an                                                               
ongoing investigation.                                                                                                          
                                                                                                                                
4:00:42 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS asked  what the legislature has done  in the past                                                               
when it is  found that a board member doesn't  meet the statutory                                                               
requirements for appointment.                                                                                                   
                                                                                                                                
MS.  CURTIS responded  that the  legislature doesn't  act because                                                               
usually  her recommendation  is to  the governor's  office, which                                                               
typically  removes the  board member  and appoints  someone else,                                                               
and which was  done in this case.  In  further response, she said                                                               
the governor's  office has reported  that this was done,  but she                                                               
cannot verify it.                                                                                                               
                                                                                                                                
4:01:15 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MCCARTY  asked whether  this person  was appointed                                                               
and confirmed or was in the appointment process.                                                                                
                                                                                                                                
MS. CURTIS replied that this  person was appointed and confirmed.                                                               
In  further response,  she confirmed  that after  confirmation it                                                               
was found  that the  appointee didn't qualify.   She  stated that                                                               
this was  an issue  in the  prior sunset  audit as  well.   It is                                                               
usually not  a risky area,  she advised,  so for all  of Alaska's                                                               
boards [the  Division of  Legislative Audit]  doesn't necessarily                                                               
send a notice  to the public member to ensure  that the member is                                                               
qualified.    But,  she  continued,   since  there  was  a  prior                                                               
recommendation related  to this  board, [the  division] confirmed                                                               
the public member.  It usually  has to do with whether the member                                                               
has a direct financial interest  in the health care industry, she                                                               
explained.  In  this case it was found that  the board member was                                                               
a licensed emergency medical technician  (EMT), so the member had                                                               
an  interest in  the health  care industry  and therefore  didn't                                                               
comply  with  statutory requirements  that  prohibit  this.   The                                                               
public  member must  have that  consumer perspective,  she added,                                                               
and in this case the member didn't.                                                                                             
                                                                                                                                
4:02:16 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS asked whether it  is fair to characterize this as                                                               
an inadvertent violation.                                                                                                       
                                                                                                                                
MS. CURTIS replied yes.                                                                                                         
                                                                                                                                
4:02:24 PM                                                                                                                    
                                                                                                                                
MS. CURTIS resumed her invited  testimony.  She drew attention to                                                               
page 5 [Exhibit  2] of the audit and reported  that as of January                                                               
2021 there  were 306 licensed  chiropractors.  She turned  to the                                                               
board's schedule of revenues and  expenditures on page 6 [Exhibit                                                               
3] and  noted that [over  the past  four fiscal years]  the board                                                               
alternated between  a deficit  and a surplus.   She  related that                                                               
according  to   management  at  the  Division   of  Corporations,                                                               
Business  and Professional  Licensing  (DCBPL),  the deficit  was                                                               
within  a   reasonable  range   and  a   fee  increase   was  not                                                               
recommended.   She pointed  out the board's  schedule of  fees on                                                               
page 7 [Exhibit 4].                                                                                                             
                                                                                                                                
MS.   CURTIS  moved   to  pages   9-11  and   outlined  the   two                                                               
recommendations made by  the Division of Legislative  Audit.  She                                                               
said the  first recommendation is  that the governor  should make                                                               
board  appointments in  compliance  with statutory  requirements.                                                               
The  second  recommendation,  she  related,  is  that  the  DCBPL                                                               
director  should allocate  sufficient resources  to ensure  cases                                                               
are investigated  in a timely  manner.   The audit found  that 11                                                               
cases had been  open for over 180 days, she  stated, and seven of                                                               
those cases  were related to  the same chiropractor and  had been                                                               
combined into  one case.   For that  one combined case  the audit                                                               
found  four periods  of unjustified  inactivity that  ranged from                                                               
55-208 days, she continued, and  according to DCBPL investigative                                                               
staff the inactivity  was the result of  competing priorities and                                                               
insufficient resources.                                                                                                         
                                                                                                                                
MS. CURTIS  proceeded to pages  21-22 and  discussed management's                                                               
response to the audit.  She  related that the commissioner of the                                                               
Department  of  Commerce,  Community,  and  Economic  Development                                                               
(DCCED)  states  that the  department  has  hired two  additional                                                               
investigative positions  and the commissioner believes  that will                                                               
increase  the  quality and  timeliness  of  investigations.   She                                                               
turned to  the governor's  response on page  23 and  related that                                                               
the governor agrees  with the recommendation and  states that the                                                               
public member  was removed.   Ms. Curtis then reviewed  the board                                                               
chair's response  on pages  25-28.  She  reported that  the chair                                                               
does not agree  with the recommended extension of  five years and                                                               
requests an  eight-year extension  because he believes  the board                                                               
is  being unfairly  penalized by  action of  the division  or the                                                               
governor's office.                                                                                                              
                                                                                                                                
4:04:20 PM                                                                                                                    
                                                                                                                                
CO-CHAIR SPOHNHOLZ returned to the  second recommendation on page                                                               
10 of  the audit report.   Regarding the 11 cases  that were open                                                               
over  180 days  between July  2017  and January  2021, she  asked                                                               
whether each  of the 11  cases was open  180 days or  whether the                                                               
cases were cumulatively open 180 days.                                                                                          
                                                                                                                                
MS. CURTIS  responded that it was  each of them.   She noted that                                                               
180 days is an internal performance  measure used by DCBPL.  Lots                                                               
of reasons  can cause a  case to remain  open, she noted,  so the                                                               
Division of  Legislative Audit looks  at whether it  is justified                                                               
and there are reasons a case is  open.  In these cases, she said,                                                               
the  audit  saw  extended  periods of  inactivity,  but  with  no                                                               
justification; it  was found that  it is an issue  with resources                                                               
and competing priorities.                                                                                                       
                                                                                                                                
4:05:44 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MCCARTY asked  whether this is a  situation of the                                                               
division not  being able  to assist  the board  or the  board not                                                               
taking responsibility to do such things as verifying a case.                                                                    
                                                                                                                                
MS.  CURTIS  answered   that  the  board  is   kept  outside  the                                                               
investigative  process so  it  can  rule on  the  results of  the                                                               
investigation  in a  quasi-judicial  manner.   Sometimes a  board                                                               
member might  be used for  expertise, but then that  board member                                                               
is not  allowed to weigh  in on the result,  she noted.   So, the                                                               
board typically monitors the cases  on an upper level and doesn't                                                               
get  into the  details until  the investigation  is complete  and                                                               
brought to the board.                                                                                                           
                                                                                                                                
REPRESENTATIVE MCCARTY  inquired about whether the  sunset should                                                               
be effective  for the board when  the division is supposed  to be                                                               
assisting  the board.    He said  it appears  that  the Board  of                                                               
Chiropractic Examiners  is doing fine  as a board and  that there                                                               
should be  a sunset for  the board and  an annual sunset  for the                                                               
division to  ensure that the  division is  doing its job  to help                                                               
the board.                                                                                                                      
                                                                                                                                
MS. CURTIS replied that oftentimes  board chairs do bring that up                                                               
and that some  things are not within their control.   It might be                                                               
considered  a penalty  or  a discipline  from  the board  chair's                                                               
perspective, she stated,  but from her perspective  and the law's                                                               
perspective,  this is  a legislative  oversight process,  this is                                                               
the  legislature's   ability  to  evaluate  how   this  board  is                                                               
operating  and  that  includes the  division's  support  to  this                                                               
board.    She explained  that  her  recommendation for  extension                                                               
reflects how timely  she recommends the legislature  come back to                                                               
review regulation of this specific  occupation.  She advised that                                                               
while the question  is termed, "Should this board  be extended or                                                               
not  and for  how  long?" it  could be  phrased,  "How much  time                                                               
between now and when the legislature comes back in to review?"                                                                  
                                                                                                                                
4:08:47 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  SPOHNHOLZ drew  attention to  the DCCED  commissioner's                                                               
response to  the audit on  pages 21-22.   She inquired  about the                                                               
efforts taken by  DCCED to ensure adequate  staffing, whether the                                                               
specific  11  cases have  been  resolved,  and what  the  current                                                               
timeframe is for processing complaints against a chiropractor.                                                                  
                                                                                                                                
4:09:29 PM                                                                                                                    
                                                                                                                                
SARA CHAMBERS,  Director, Division of Corporations,  Business and                                                               
Professional   Licensing   (DCBPL),   Department   of   Commerce,                                                               
Community, and Economic Development  (DCCED), responded that page                                                               
22 outlines the steps that were  taken.  One step, she specified,                                                               
is that the division has  added an additional senior investigator                                                               
position to  provide more supervisory  oversight and  ensure that                                                               
investigators  are   following  the  division's   procedures  for                                                               
documentation.   The concern is not  so much whether there  is or                                                               
isn't  case activity,  she  explained, but  that  it hasn't  been                                                               
documented  and so  there is  no way  for the  auditor or  anyone                                                               
looking at the  case management systems to  know whether activity                                                               
has taken place on those cases.   She said DCBPL agrees that that                                                               
is not up  to its stated standards, so  adding another supervisor                                                               
position  has been  helpful.   A zero-tolerance  position on  the                                                               
lack  of  documentation has  been  taken,  she advised,  and  the                                                               
division  is   actively  supervising  and  ensuring   that  DCBPL                                                               
investigators are  acutely aware  of the requirement  to document                                                               
within every 30-45 days even if  there is no case activity and to                                                               
describe what is being waited on  and what is the process so that                                                               
anyone can  evaluate whether  a case  is being  properly managed.                                                               
Ms. Chambers  stated that  every case is  different, so  180 days                                                               
could  be appropriate  management for  some cases  and for  other                                                               
cases it  could be more days  or less days.   Much of that  is in                                                               
the  hands of  the respondent,  she pointed  out, and  whether an                                                               
expert  witness is  needed.   She  related that  the seven  cases                                                               
rolled  into  one  have  made progress  and  are  being  actively                                                               
managed.                                                                                                                        
                                                                                                                                
4:12:19 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  SPOHNHOLZ  observed  on  page  22  that  an  additional                                                               
Investigator  III  position  has  been added  to  the  healthcare                                                               
licensing team.   She inquired about the number of  people on the                                                               
healthcare  team and  the number  of healthcare  licensing boards                                                               
for  which  the  team  is  responsible  for  providing  licensing                                                               
investigations and processing.                                                                                                  
                                                                                                                                
MS. CHAMBERS  answered that  she will get  back to  the committee                                                               
with those  specific numbers, including the  structure of today's                                                               
healthcare team  as far as numbers  of staff and the  boards they                                                               
serve.   She explained that  those fluctuate with the  demands of                                                               
the casework  where there  may be increases  in complaints  or an                                                               
increase  in complexity  requiring  an investigator  to manage  a                                                               
lower caseload.  She explained  that DCBPL can have investigators                                                               
moving  off   and  on  that   team;  the  division   has  partial                                                               
investigators  assigned to  certain boards  and then  some boards                                                               
like nursing and  medical have multiple investigators  due to the                                                               
high volume.                                                                                                                    
                                                                                                                                
CO-CHAIR SPOHNHOLZ requested that  the follow-up to the committee                                                               
be in writing so it can be  distributed to members.  She said she                                                               
wants to  understand how the  oversight is  managed, particularly                                                               
for chiropractors.   She  stated that  the one  chiropractor with                                                               
seven complaints and the investigations  not being followed up in                                                               
a  timely manner  could be  impacting many  Alaskans during  this                                                               
amount of time.                                                                                                                 
                                                                                                                                
MS.  CHAMBERS offered  her appreciation  for Co-Chair  Spohnholz'                                                               
comments.  She stated that DCBPL  is a public safety division and                                                               
part of what it does is protect  the rights of the licensee.  So,                                                               
she  explained, the  division has  certain processes  that it  is                                                               
required to follow  and sometimes cases are very  unusual and may                                                               
be delayed  when early action  could jeopardize the  case because                                                               
of those due  process standards.  She offered  her reassurance to                                                               
the committee that these are of high importance to DCBPL.                                                                       
                                                                                                                                
4:16:04 PM                                                                                                                    
                                                                                                                                
The committee took an at-ease from 4:16 p.m. to 4:20 p.m.                                                                       
                                                                                                                                
4:20:01 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS  invited further questions from  the committee on                                                               
CSSB 193(FIN).                                                                                                                  
                                                                                                                                
4:20:24 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   MCCARTY,   regarding   the   prescription   drug                                                               
monitoring   program   (PDMP),   asked  about   the   number   of                                                               
investigations  that  occurred  because of  deficiencies  in  the                                                               
division's system versus  a licensee wrong.  He  recalled that in                                                               
the  past Ms.  Chambers shared  that licensees  were investigated                                                               
but it was  problems in the system that created  an anomaly which                                                               
had to be investigated.   Representative McCarty further inquired                                                               
about the sunset extension of two years versus five years.                                                                      
                                                                                                                                
MS.  CHAMBERS responded  that she  doesn't  understand the  first                                                               
question  because the  division has  not had  system deficiencies                                                               
resulting in  unwarranted investigation.   She said  the division                                                               
does have  quite a  few investigations  that it  must investigate                                                               
due to public complaints that  don't result in discipline because                                                               
they  are found  to be  not jurisdictional,  unwarranted, or  not                                                               
within  the  division's scope  so  it  was more  appropriate  for                                                               
criminal law  enforcement or the  consumer protection  unit under                                                               
the  Department of  Law.    She offered  to  answer the  question                                                               
further if the representative wished to rephrase it.                                                                            
                                                                                                                                
REPRESENTATIVE  MCCARTY  restated  his question  about  a  sunset                                                               
extension of two years versus five years.                                                                                       
                                                                                                                                
MS. CHAMBERS replied that the  auditor's recommendation was for a                                                               
five-year  extension,  the  Senate Labor  and  Commerce  Standing                                                               
Committee  reduced  the extension  to  two  years, and  then  the                                                               
Senate  Finance  Committee  reversed  it back  to  the  auditor's                                                               
recommendation.                                                                                                                 
                                                                                                                                
[CSSB 193(FIN) was held over.]                                                                                                  
                                                                                                                                
                 HB 405-ESTABLISHMENT OF TRUSTS                                                                             
        HB 406-MORATORIUM ON TRUSTS/PROPERTY ACQUISITION                                                                    
                                                                                                                                
4:23:24 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS announced that the  final order of business would                                                               
be HOUSE BILL  NO. 405, "An Act relating to  the establishment of                                                               
trusts; requiring  the filing of  certain trust  information; and                                                               
requiring  compliance with  a federal  law." and  HOUSE BILL  NO.                                                               
406,  "An  Act  relating  to the  validity  of  trusts  involving                                                               
persons  sanctioned  by  the  United  States  Department  of  the                                                               
Treasury; and  relating to the  recording of  documents conveying                                                               
land to  persons sanctioned  by the  United States  Department of                                                               
the Treasury."                                                                                                                  
                                                                                                                                
CO-CHAIR FIELDS  opened public  testimony on HB  405 and  HB 406.                                                               
He said the committee has  been reading the written testimony and                                                               
is  working on  amendments in  response  to that  testimony.   He                                                               
stated that the  committee would listen to  today's testimony and                                                               
potentially respond at the next hearing.                                                                                        
                                                                                                                                
4:24:19 PM                                                                                                                    
                                                                                                                                
CHRIS LAUER, Esq., expressed his concerns  with HB 405.  He noted                                                               
that before becoming an estate  planning attorney he worked as an                                                               
anti-money  laundering  consultant  where   he  assisted  in  the                                                               
development and implementation  of anti-money laundering measures                                                               
for mid-size banks.  That  work, he said, directly and indirectly                                                               
led  to  the  identification, prosecution,  and  imprisonment  of                                                               
financial  criminals.   He advised  that while  he is  profoundly                                                               
sympathetic  to the  aims of  HB  405, the  bill illustrates  the                                                               
difficulty   of   drafting    effective   anti-money   laundering                                                               
legislation that does not unduly burden the law-abiding public.                                                                 
                                                                                                                                
MR.  LAUER stated  that while  HB  405 and  the [2021]  Corporate                                                               
Transparency Act  (CTA) are related,  their differences  are very                                                               
important.  He said the CTA  is the most recent addition to anti-                                                               
money  laundering  measures  that  the US  has  in  place,  which                                                               
include the [1970] Bank Secrecy  Act, the [2001] USA PATRIOT Act,                                                               
and several  other landmark  acts.   The purpose  of the  CTA, he                                                               
advised,  is  to  make  laundering harder  to  do  through  shell                                                               
companies.   Shell companies, he continued,  have legitimate uses                                                               
for asset  protection, legacy planning, and  business management,                                                               
but bad actors can and do abuse  them.  The CTA, he explained, is                                                               
tailored to  minimize the  impact of the  law on  the law-abiding                                                               
public while  making shell companies inhospitable  for criminals.                                                               
Under that framework,  he stated, the CTA deals  with two primary                                                               
concepts:  reporting companies and beneficial owners.                                                                           
                                                                                                                                
MR. LAUER  explained that reporting  companies file  reports with                                                               
the [Department  of the Treasury's] Financial  Crimes Enforcement                                                               
Network   (FinCEN),  and   these   reports  contain   identifying                                                               
information on each  company's beneficial owners.   He said there                                                               
are 24 exceptions to what counts  as a reporting company, most of                                                               
which  is defined  to include  a  corporation, limited  liability                                                               
company (LLC),  or similar entity  that is created by  the filing                                                               
of the  document with the  secretary of state or  similar office;                                                               
in Alaska, that  would be the Department  of Commerce, Community,                                                               
and Economic  Development (DCCED).  Beneficial  owners, Mr. Lauer                                                               
specified,  are  defined  to  be   individuals  who  directly  or                                                               
indirectly through any contract  or arrangement, understanding of                                                               
relationship, or  otherwise exercise  substantial control  over a                                                               
reporting  company or  owner control  25 percent  or more  of the                                                               
ownership  in  trust in  that  entity.    That  is a  very  broad                                                               
definition,  he stated,  and  it probably  doesn't  line up  with                                                               
[Alaskans'] assumptions  about what  "beneficial owner"  means in                                                               
the wild.                                                                                                                       
                                                                                                                                
4:26:52 PM                                                                                                                    
                                                                                                                                
MR. LAUER  advised that the  CTA does not attempt  to incorporate                                                               
trusts, which the Supreme Court  has recognized as relationships,                                                               
not  entities,  into  its   definition  of  reporting  companies.                                                               
Trusts  may be  a beneficial  owner  of a  reporting company,  he                                                               
said, someone  acting through a  trust relationship  can exercise                                                               
substantial  control over  one.   Final  federal regulations  are                                                               
being  awaited to  clarify  who exactly  counts  as a  beneficial                                                               
owner under a  trust, he stated.  The  proposed regulations raise                                                               
more questions for  trusts than they answer, they  do not address                                                               
discretionary  trusts  with  multiple  beneficiaries,  contingent                                                               
beneficiaries, powers  of appointment unmeasurable in  trusts, or                                                               
third  parties  who   deal  with  authority  over   trusts.    He                                                               
maintained  that turning  trusts into  reporting companies  would                                                               
amplify  these ambiguities  and create  additional headaches  for                                                               
Alaskans.   He advised  that so  far, for trusts  that hold  a 25                                                               
percent or  greater membership interest  in a  reporting company,                                                               
it  would  be  suspected  that  at  least  the  sole  permissible                                                               
recipient of trust income and  principle and anyone with power to                                                               
dispose  of trust  assets would  be beneficial  owners under  the                                                               
CTA.   Mr.  Lauer said  the  reporting company  would still  file                                                               
beneficial  ownership information  with FinCEN  but a  trust that                                                               
holds a savings  account or securities would not  be a beneficial                                                               
owner of  a reporting company under  the federal rules.   From an                                                               
enforcement perspective this makes a  lot of sense, he continued,                                                               
it makes  it so that  bad actors cannot hide  behind confidential                                                               
LLCs in places like Wyoming or  Nevada, but the trustees who hold                                                               
title to property in their  capacity as trustees would still need                                                               
to  identify   themselves  to  state  banks   to  satisfy  banks'                                                               
reporting  requirements under  the Bank  Secrecy Act  or the  USA                                                               
PATRIOT Act.                                                                                                                    
                                                                                                                                
MR. LAUER stated that HB 405  and the CTA differ significantly in                                                               
many respects.   He said  the CTA focuses  on what a  trust owns,                                                               
not on  what a trust  is.  A revocable  trust that only  holds an                                                               
Edward Jones  account is not  going to  report under the  CTA, he                                                               
said,  because it  wouldn't be  a reporting  company.   He stated                                                               
that HB 405 is far more  expansive and as written he is concerned                                                               
that trusts  created under  a will, revocable  trusts that  are a                                                               
will  substitute,  charitable  trusts, and  others  would  create                                                               
risks for anyone who would create  them for fines or for the risk                                                               
of invalidity of paperwork that  is not appropriately filed.  The                                                               
CTA sets a  uniform standard that applies equally  to all states,                                                               
he conveyed, and HB 405  would impose greater burdens on Alaskans                                                               
than those  faced by trusts established  in any other state.   He                                                               
said the  CTA ends  gamesmanship between states  and makes  it so                                                               
that no  state can  compete against others  by offering  the most                                                               
secretive shell companies.  In  contrast, Mr. Lauer continued, HB
405 would encourage law abiding  Alaskans to form trusts in other                                                               
states to avoid  penalties for inadvertent reporting  errors.  As                                                               
federal  legislation,  the CTA  can  set  national standards,  he                                                               
continued, but  he is  concerned that  a bad  actor might  form a                                                               
trust  outside  Alaska and  use  the  trust to  conduct  business                                                               
inside Alaska, [and Alaska] would  be limited in how it restricts                                                               
that type of activity.                                                                                                          
                                                                                                                                
4:29:52 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  FIELDS  said he  would  be  interested in  Mr.  Lauer's                                                               
perspective on HB 408, the  administration's bill that also seeks                                                               
to prevent money laundering.                                                                                                    
                                                                                                                                
4:30:05 PM                                                                                                                    
                                                                                                                                
CO-CHAIR SPOHNHOLZ, regarding Mr.  Lauer's statement that the CTA                                                               
doesn't  yet have  any  guidance that  relates  to trusts,  asked                                                               
whether it is going to.                                                                                                         
                                                                                                                                
MR. LAUER  replied that the proposed  regulations have identified                                                               
some   of  the   circumstances  that   FinCEN  thinks   would  be                                                               
appropriate for including people  involved in trust relationships                                                               
as beneficial  owners, but  there are many  open questions  as to                                                               
who would  fit under that.   He deferred  to the comments  of the                                                               
American College  of Trust and  Estate Counsel (ACTEC)  that were                                                               
submitted  to   FinCEN  during  the  comment   period  for  those                                                               
regulations.    He  related  that  for  a  trust  that  is  fully                                                               
discretionary and  able to make  distributions to any  of several                                                               
beneficiaries,  ACTEC's  comments  identify that  it  is  unclear                                                               
whether  all  those  beneficiaries   would  need  to  have  their                                                               
information   disclosed,  as   well  as   whether  a   contingent                                                               
beneficiary's information would need to  be reported.  He said it                                                               
is  anticipated that  these questions  will be  addressed in  the                                                               
final regulations that are expected before the end of 2022.                                                                     
                                                                                                                                
4:31:44 PM                                                                                                                    
                                                                                                                                
MATTHEW  BLATMACHR,   President  &   CEO,  Peak   Trust  Company,                                                               
expressed his  concerns with HB  405 and HB  406.  He  noted that                                                               
Peak  Trust Company  has provided  fiduciary services  to Alaskan                                                               
families for over 25 years.   He said his company understands the                                                               
intent of the  bills and would like to work  with the legislature                                                               
and others  in the  industry to identify  the best  path forward.                                                               
He  maintained that  as  currently drafted  the  bills would  not                                                               
achieve  their intended  result and  would instead  harm Alaskans                                                               
unintentionally.    Mr.  Blatmachr  said he  will  discuss  three                                                               
points:   1)  There are  existing  statutes that  make Alaska  an                                                               
undesirable  place for  bad  actors, and  those  statutes can  be                                                               
strengthened; 2) There are  some misconceptions regarding trusts;                                                               
and 3) There is an issue  of privacy and data security related to                                                               
these bills.                                                                                                                    
                                                                                                                                
MR. BLATMACHR  spoke to  his first  point that  existing statutes                                                               
make Alaska a bad place for  bad people.  He said the legislature                                                               
has worked diligently  for over 25 years to  build thoughtful and                                                               
deliberate  statutes  that  allow for  excellent  planning  while                                                               
protecting against  abuse.   For example,  he related,  Alaska is                                                               
one  of the  few states  that  require trusts  to be  registered.                                                               
Registration includes the name of  the trust; name and address of                                                               
the trustee; and  name of the person who created  the trust, also                                                               
referred  to  as a  settlor  or  grantor.   Another  example,  he                                                               
continued,  is that  Alaska  requires  a person  to  fill out  an                                                               
affidavit  of  solvency, an  affidavit  must  be completed  by  a                                                               
person creating  an irrevocable  trust of which  the person  is a                                                               
potential beneficiary and certify  that the transfers or deposits                                                               
to the trust are not fraudulent.                                                                                                
                                                                                                                                
MR.  BLATMACHR addressed  his  second  point that  misconceptions                                                               
about  trusts are  being carried  forward.   Regarding statements                                                               
that trusts are secretive and  have no reporting requirements, he                                                               
stated that  trusts are certainly confidential,  but advised that                                                               
they do  have reporting  requirements:   one is  the registration                                                               
requirement, and another  is that all US sourced  income inside a                                                               
trust must  be reported on  a federal  tax return.   Depending on                                                               
the trust  type, either the  trust will  file its own  return, or                                                               
the  income  will be  reported  on  the  personal return  of  the                                                               
grantor,  the  person who  created  the  trust, or  the  personal                                                               
return of a  beneficiary, which is a tracking  mechanism for that                                                               
income.  Regarding previous comments  about real estate money and                                                               
trusts, he continued, there seems  to be a conflation between the                                                               
two  because the  issues referenced  in the  comments about  what                                                               
occurred in Alaska  do not involve trusts.  He  stated that based                                                               
on the  information he  is aware of,  there was  money laundering                                                               
activity and there were foreign  individuals, but trusts were not                                                               
part of the nefarious activity.   The uncovering of these issues,                                                               
he argued,  proves that systems  are in  place that work.   Also,                                                               
Mr. Blatmachr added,  while the Pandora Papers are  only a sample                                                               
set, the  documents do not  indicate that  Alaska is a  haven for                                                               
people  with nefarious  intent.   He maintained  that with  these                                                               
bills Alaskans would be potentially  punished due to the improper                                                               
actions of  individuals in other  states.  Further, he  said, the                                                               
legislation targets  everyone rather than individuals  who create                                                               
higher risks; it is hard  to draft legislation that doesn't throw                                                               
everybody into the same pot.                                                                                                    
                                                                                                                                
4:35:35 PM                                                                                                                    
                                                                                                                                
MR. BLATMACHR discussed  his third point that there  are data and                                                               
privacy issues related  to the bills.   Regarding statements that                                                               
the  proposed disclosure  of personally  identifiable information                                                               
required in  HB 405 would  be held  in confidence with  DCCED and                                                               
would  not be  public information,  he said  that is  understood.                                                               
However,  he maintained,  Alaskans  are not  going  to find  this                                                               
acceptable  - every  day a  new security  or data  breach occurs,                                                               
including breaches  with the Alaska  government and  other Alaska                                                               
institutions.   Plus,  he said,  this dataset  would likely  be a                                                               
target   since   it   would   include   personally   identifiable                                                               
information of  individuals and families  with wealth  and assets                                                               
in Alaska.   He posited that rather than  potentially expose this                                                               
information  to a  breach,  Alaskans would  likely  choose to  do                                                               
business  outside of  the state,  thus continuing  the punishment                                                               
when they have done nothing wrong.                                                                                              
                                                                                                                                
MR. BLATMACHR  stated that he and  Peak Trust Company want  to be                                                               
part of the solution  like in years past.  He noted  that he is a                                                               
member of Alaska  Trust & Estate Professionals  (ATEP), which has                                                               
proposed alternatives that  he and his company support.   He said                                                               
he looks  forward to  further dialogue  with the  legislature and                                                               
other stakeholders.                                                                                                             
                                                                                                                                
4:36:41 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS  stated that  the committee  has been  working on                                                               
some of those proposals for HB 406.                                                                                             
                                                                                                                                
4:36:46 PM                                                                                                                    
                                                                                                                                
ABIGAIL O'CONNOR, Esq., testified in  opposition to HB 405 and HB
406.   She noted that she  is an estate planning  attorney but is                                                               
not  testifying  in any  representative  capacity.   She  further                                                               
noted that she is a member  and vice president of ATEP, the state                                                               
chair-elect  of the  Alaska Chapter  of the  American College  of                                                               
Trust and  Estate Counsel, the  president-elect of  the Anchorage                                                               
Estate Planning  Council, and  an executive  board member  of the                                                               
Estate Planning Section of the  Alaska Bar Association.  She said                                                               
she agrees with  the purpose of preventing bad  actors from using                                                               
Alaska  trusts   and  is  sympathetic   to  the  intent   of  the                                                               
legislation.    However,  she  continued, her  focus  is  on  the                                                               
protection of everyday  Alaskans who use trusts as  part of their                                                               
regular estate planning for their  families.  She stated that any                                                               
legislation  that affects  trusts for  everyday Alaskans  must be                                                               
done in a  thoughtful manner that does not  create unintended and                                                               
harmful consequences and that does not  act as a deterrent to law                                                               
abiding  Alaskans from  creating good  estate planning  for their                                                               
families.                                                                                                                       
                                                                                                                                
MS. O'CONNOR provided an example of  how a typical trust would be                                                               
done under  current law  for people who  would not  be considered                                                               
wealthy:  Her clients, Mom and  Dad, have come into her office to                                                               
do estate  planning.  They  have a house, an  investment account,                                                               
checking  account,  family  cabin,  and each  has  an  individual                                                               
retirement account (IRA).  One of  their two adult children is in                                                               
a  rocky marriage  and  the other  does not  know  how to  handle                                                               
money.  Two  of their five grandchildren are  excelling in school                                                               
and want  to go to  graduate school and  they want to  help them.                                                               
The other  grandchildren are  all minors.   Mom  and Dad  want to                                                               
ensure  that their  hard-earned nest  egg is  available to  their                                                               
children after their deaths without  dissipating the resources so                                                               
that   the   money  ultimately   will   be   available  for   the                                                               
grandchildren.  If Mom and Dad  leave the money to their children                                                               
outright, then the money will be  spent quickly and there will be                                                               
nothing left  for the grandchildren.   Trusts are the  answers to                                                               
Mom and  Dad's problem.   The assets can  then be held  in trust,                                                               
Mom and  Dad can be  the lifetime  beneficiaries, they can  use a                                                               
revocable trust.   After Mom and  Dad pass away the  property can                                                               
be held in  separate trusts for their  children with restrictions                                                               
on distributions  to ensure  that the  funds are  not dissipated.                                                               
After each child dies, his or  her separate trust is divided into                                                               
further  trusts for  his or  her [children].   This  protects the                                                               
assets and  ultimately provides for  Mom and  Dad's grandchildren                                                               
while allowing  the resources  to be available  in a  limited way                                                               
for their  children.   Because Mom  and Dad  love this  idea, Ms.                                                               
O'Connor  drafts the  trust  agreement, which  Mom  and Dad  then                                                               
sign.  She drafts  a deed for Mom and Dad's house  and a deed for                                                               
their  cabin; they  are deeds  from themselves  to themselves  as                                                               
trustees and  they sign the deed.   They also sign  an assignment                                                               
of tangible properties from themselves  to themselves as trustees                                                               
to assign  their tangible  property to the  trust.   Ms. O'Connor                                                               
helps Mom and Dad fill  out paperwork to retitle their investment                                                               
account and  checking account in  the name  of the trust.   Their                                                               
IRAs  stay in  their  own names,  and they  are  payable to  each                                                               
spouse on  death but at the  survivor's death they use  a special                                                               
designation on  a beneficiary form  to pay  the IRAs over  to the                                                               
trust.   All  of this  is done  in Ms.  O'Connor's office  in one                                                               
meeting   her clients now have  a valid trust.  Ms. O'Connor then                                                               
records the deeds  and sends in Mom and  Dad's trust registration                                                               
to the court - this is  not required as a condition of formation,                                                               
but   is  required   for   jurisdictional   purposes,  and   that                                                               
registration reports  only Mom and  Dad's names, the name  of the                                                               
trust, their address, and the date of their trust.                                                                              
                                                                                                                                
4:41:06 PM                                                                                                                    
                                                                                                                                
MS. O'CONNOR then  explained how this same example  would be done                                                               
under HB 405 and  HB 406 as drafted:  First,  the trust would not                                                               
be  enforceable until  filing the  trust establishment  document.                                                               
What does  that really mean?   Mom and Dad already  signed deeds,                                                               
assigned property  to themselves as trustees,  they declared that                                                               
they  were  holding  property  in   trust,  which  is  valid  and                                                               
consistent with hundreds  of years of trust law,  and their trust                                                               
relationship has  been established.  What  does it mean if  it is                                                               
not enforceable?   What happens if the client  dies before filing                                                               
the trust establishment  document?  What happens  to the property                                                               
if the  trust is not  valid because of HB  405?  Second,  Mom and                                                               
Dad must file  the trust establishment apparently  with the names                                                               
and  addresses of  all their  children and  grandchildren because                                                               
they are beneficiaries.  Third,  the requirement is that any time                                                               
there is an inaccuracy in the  document, which could be caused by                                                               
a  change, Mom  and Dad  must file  an update.   This  means that                                                               
every time a  grandchild changes a dorm room,  or somebody moves,                                                               
or a  grandchild or  great-grandchild is born,  Mom and  Dad must                                                               
file an update with the Department  of Commerce within 30 days or                                                               
face a  $500 fine.   Fourth,  if one  of the  grandchildren "goes                                                               
rogue" and  ends up  on the  [Specially Designated  Nationals and                                                               
Blocked Persons  List (SDN  List)], then the  entire trust  is no                                                               
longer valid  under HB 406.   What does that mean?   What happens                                                               
to the  property?  Who receives  the property?  What  are the tax                                                               
consequences?     What   about   all  the   other  children   and                                                               
grandchildren?  What  about Mom and Dad?  What  if the trust owns                                                               
a  partnership   interest  and  is   subject  to   a  partnership                                                               
agreement, what happens to those  partners?  What if the trustees                                                               
are borrowers  on a  loan, what  happens to  the creditor  if the                                                               
trust  is now  invalid?   There are  no answers.   Fifth,  HB 405                                                               
somehow renders  the trust  a reporting  company for  purposes of                                                               
the Corporate  Transparency Act.   As Mr. Lauer  testified, under                                                               
the CTA a trust is not a  reporting a company, it is not required                                                               
to report  to the Financial  Crimes Enforcement Unit, but  HB 405                                                               
now says that the trust is a  reporting company.  So, Mom and Dad                                                               
must  file reports  with  FinCEN for  their  revocable trust  and                                                               
follow the CTA rules?  But  FinCEN is not expecting those reports                                                               
because trusts are not reporting  companies.  What happens if Mom                                                               
and  Dad don't  comply?   Well, under  federal law  they are  not                                                               
required to report  a trust.  What is the  implication of a state                                                               
law that  fiddles with the  federal law?   How do  they interact?                                                               
Who  enforces  it?   Is  the  law even  enforceable?    Or is  it                                                               
preempted by  federal law?   Ms. O'Connor  said she  doesn't know                                                               
the answers to these questions.                                                                                                 
                                                                                                                                
4:44:13 PM                                                                                                                    
                                                                                                                                
MS.  O'CONNOR continued  her testimony.    She said  Mom and  Dad                                                               
walked in  the door to  do relatively simple estate  planning and                                                               
now these  clients are up  to their  ears in the  DCCED reporting                                                               
requirement,  FinCEN,  $500  penalties, and  questions  of  trust                                                               
validity for things  beyond their control.  She  said her clients                                                               
will tell  her to  forget about  the trust, they  do not  want to                                                               
risk it  or deal with  these penalties.   Or, she  continued, Mom                                                               
and Dad  will ask if  there is an  alternative and she  will tell                                                               
them yes  - another jurisdiction can  be used.  This  means going                                                               
to another  state, forming the  trust there, and adhering  to the                                                               
rules of that  other state because Alaska will be  the only state                                                               
that has this  requirement.  This also likely means  that some or                                                               
all the  assets in the  trust need to  move away from  the Alaska                                                               
banks and into the banks in  the state where the jurisdiction is.                                                               
Plus, she  noted, her clients  will have  to get an  attorney and                                                               
possibly  other professionals  involved  in that  other state  to                                                               
help advise them.  All of  this for something that should be very                                                               
simple and is an everyday  occurrence for estate planning clients                                                               
in Alaska.  She said there is no  question that HB 405 and HB 406                                                               
have  very good  intention.    But, she  advised,  the impact  on                                                               
everyday  Alaskans   for  their   estate  planning  will   be  so                                                               
significant it is going to turn them away from doing trusts.                                                                    
                                                                                                                                
4:45:52 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS  stated that  the committee  has been  working on                                                               
some changes based on Ms. O'Connor's recommendations.                                                                           
                                                                                                                                
REPRESENTATIVE KAUFMAN  offered his  thanks and  appreciation for                                                               
Ms. O'Connor's testimony.                                                                                                       
                                                                                                                                
4:46:14 PM                                                                                                                    
                                                                                                                                
LINDA  HULBERT, testified  in opposition  to HB  405 and  HB 406.                                                               
She noted  that she has  been in  the insurance industry  for the                                                               
last 33  years, has offices  in Fairbanks and Anchorage,  and has                                                               
clients statewide.  She related that  over the last six to twelve                                                               
months she has discussed wills  and trusts with her clients about                                                               
40-50  times.   She explained  that  when clients  come into  her                                                               
office  she asks  them  if they  have  a will  and  what kind  of                                                               
planning they have done.   She said her job is  to help them plan                                                               
for the future,  look at how they are  protecting their families,                                                               
how they are growing their  income, how they are protecting their                                                               
business, and to  help them make a  plan that is going  to last a                                                               
long time and protect their assets.                                                                                             
                                                                                                                                
MS. HULBERT  explained that  many people start  with a  simple "I                                                               
love you will," but after  children appear it suddenly is whether                                                               
they want  secondary beneficiaries with their  life insurance and                                                               
other assets.   She said her clients must plan  whether they want                                                               
their children  to inherit  cash or whether  they want  to direct                                                               
how and when their  assets can be spent.  She  said she helps her                                                               
clients evolve their  planning, starting a will and  a trust, and                                                               
ultimately  her clients  will reach  the level  discussed by  Ms.                                                               
O'Connor.   Many people never  get to  the level of  wealth where                                                               
they have a cabin and a  house and a lot of discretionary assets,                                                               
she  specified, but  a  trust  is still  very  important to  them                                                               
because they  have children and  then grandchildren who  begin to                                                               
grow up.   She said  this is important  to her because  these are                                                               
Alaskans who  are committed to living  in the state and  who want                                                               
to do their planning in the state.                                                                                              
                                                                                                                                
4:49:32 PM                                                                                                                    
                                                                                                                                
MS.  HULBERT  noted  that  she helps  people  in  their  planning                                                               
through the sale of insurance.   She pointed out that, in Alaska,                                                               
2.7  percent of  every dollar  spent on  every type  of insurance                                                               
goes  to the  State  of  Alaska as  revenue.    For example,  she                                                               
related, 2.7 percent of every  annual life insurance premium goes                                                               
to the State  of Alaska.  If  trusts and the assets  were to move                                                               
outside the state,  a significant amount of revenue  to the State                                                               
of Alaska  would subsequently  be lost.   Therefore,  Ms. Hulbert                                                               
stressed,  anything  that is  done  must  seriously consider  the                                                               
long-term best interest of Alaska  residents who are planning for                                                               
the  basis of  their  family, not  just  people with  significant                                                               
assets.   As well,  she continued,  a look must  be taken  at the                                                               
revenue stream  that comes into  Alaska and how that  revenue can                                                               
be used for the benefit of all Alaskans.                                                                                        
                                                                                                                                
MS.  HULBERT advised  that privacy  is critical  to everyone  she                                                               
works with.   She further advised  that many of her  clients wish                                                               
to leave  money in their wills  and trusts to charity,  and being                                                               
required to  disclose that  would not be  in their  best interest                                                               
either.   Plus, she noted,  if they  changed from one  charity to                                                               
another they  would have to file  paperwork for that.   She urged                                                               
that a  plan be  found that will  work for  everybody, especially                                                               
Alaskans who prefer to do  their planning here, because otherwise                                                               
she too will  be forced to suggest to her  clients that they move                                                               
their planning to another state in the interest of privacy.                                                                     
                                                                                                                                
4:52:28 PM                                                                                                                    
                                                                                                                                
HARRY  NEED, testified  in opposition  to HB  405.   He clarified                                                               
that  his  testimony  is  his  own and  does  not  represent  his                                                               
employer or  the organizations he  will be mentioning.   He noted                                                               
he  is   Senior  Director  of   Philanthropic  Services   at  the                                                               
University  of  Alaska  Foundation; president  of  the  Anchorage                                                               
Estate  Planning  Council,  an interdisciplinary  association  of                                                               
estate  planning  professionals;  and  a past  president  of  the                                                               
Alaska Chapter of the Association of Fundraising Professionals.                                                                 
                                                                                                                                
MR. NEED  explained that charitable  trusts are structured  for a                                                               
donor  to either  make gifts  to  charity for  several years  and                                                               
leave the  remainder to  their heirs  or, more  commonly, support                                                               
their heirs  for several years  or a  lifetime and then  give the                                                               
rest to charity.  Charitable  trusts, he related, are responsible                                                               
for the majority  of the five and six figure  deferred gifts that                                                               
he has  witnessed over  his 15-year  career in  philanthropy, and                                                               
they  are nearly  the exclusive  domain  of the  seven and  eight                                                               
figure deferred gifts  from individuals that he  has worked with.                                                               
He  expressed his  concern  that  if HB  405  creates a  chilling                                                               
effect  on  the   trust  industry  in  Alaska  it   will  have  a                                                               
disproportional negative corollary impact  on Alaska charity.  In                                                               
the  last several  years  in his  current  professional role,  he                                                               
shared,  he is  typically working  with about  20 of  these trust                                                               
relationships at  any given time  and relationships is  a crucial                                                               
word.   Trusts are legal relationships  between private entities,                                                               
Mr.  Need advised,  and private  papers between  private entities                                                               
are quintessentially private matters.   Charitable trusts involve                                                               
such things as personal values  of community, religious devotion,                                                               
family  pride,  altruism,  and   repayment,  and  Alaska's  state                                                               
constitution  enshrines  the  right  to  privacy  in  Article  I,                                                               
Section 22.   The aforementioned,  he continued, are  examples of                                                               
the  unintended consequences  that  HB 405  may  impose upon  the                                                               
charitable sector first.                                                                                                        
                                                                                                                                
MR.  NEED, regarding  the reporting  requirements within  HB 405,                                                               
advised that many Alaskan nonprofit  organizations already act as                                                               
trustees.   These nonprofits may  not employ  sophisticated trust                                                               
companies or  bank departments, he continued,  they simply follow                                                               
the  instructions  and  donative  intent outlined  in  the  trust                                                               
documentation.    They are  not  equipped  to track  or  research                                                               
dynamic lists  of beneficial interests  against dynamic  lists of                                                               
sanctioned individuals,  he specified.   The new  regulations and                                                               
proposed penalties,  he said,  could price out  all but  the most                                                               
well-funded  nonprofits  from  serving  their  benefactors  in  a                                                               
trustee  capacity.   Second, he  continued, ethical  standards in                                                               
the  fundraising sector  hold  donor confidentiality  sacrosanct.                                                               
Registering a  list of beneficial  interests implies that  one is                                                               
also not  registering other potential beneficial  interests.  The                                                               
choices  of benefactors  regarding their  legacies are  immensely                                                               
personal  and their  charitable gifts  come at  the expense  of a                                                               
gift to someone  else.  Mr. Need stated that  charities need time                                                               
to   reconcile   HB  405   with   their   obligations  to   donor                                                               
confidentiality.   Meanwhile,  he  added, he  suspects that  many                                                               
charitable donors may not follow  through with the formation of a                                                               
charitable trust.                                                                                                               
                                                                                                                                
MR.  NEED  pointed  out  that many  Alaskan  nonprofits  are  the                                                               
beneficiaries of  trusts.  He noted  that nonprofit organizations                                                               
rely upon volunteer boards that  periodically cycle directors and                                                               
that nonprofits  without brick-and-mortar locations  often change                                                               
registered  addresses,  a  burden  that is  placed  on  trustees.                                                               
Nonprofits, he  advised, will  need to  understand how  to comply                                                               
with   the   routine   resubmissions   of   their   ever-changing                                                               
fiduciaries to  a regulator.   While  the bill's  objectives come                                                               
from a  good place, experts  throughout the state are  flagging a                                                               
multitude of unintended consequences.   To that, he added, HB 405                                                               
will also  likely impact  the charitable  sector negatively.   He                                                               
urged the committee not to advance the legislation.                                                                             
                                                                                                                                
4:56:39 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS thanked  Mr. Need for providing  attention to the                                                               
charitable sector.                                                                                                              
                                                                                                                                
CO-CHAIR  SPOHNHOLZ  thanked Mr.  Need  for  his service  to  the                                                               
Anchorage  Estate  Planning Council  and  to  the Association  of                                                               
Fundraising Professionals.                                                                                                      
                                                                                                                                
4:57:10 PM                                                                                                                    
                                                                                                                                
STEPHEN GREER,  Esq., testified  in opposition to  HB 405  and HB
406.  He stated that he  has devoted his law practice exclusively                                                               
to estate planning for  the last 20 years.  He  noted he is chair                                                               
of  the Estate  Planning and  Probate Section  of the  Alaska Bar                                                               
Association,  a  member of  the  American  College of  Trust  and                                                               
Estate Counsel (ACTEC),  and a director for the  Alaska Trust and                                                               
Estate Professionals  (ATEP), but  that today  he is  speaking on                                                               
behalf of his clients.                                                                                                          
                                                                                                                                
MR. GREER related  that when he explains this  legislation to his                                                               
average client, the client's first  response is, "What right does                                                               
the government have  to intrude into my personal  affairs in this                                                               
manner?"   His  clients then  decide  whether they  are going  to                                                               
further do estate planning.  He  said he believes his clients are                                                               
right    estate planning is  a personal affair that  comes within                                                               
[an   Alaskan's]  right   of  privacy   enumerated  in   Alaska's                                                               
constitution, which is even broader  than the federal right.  The                                                               
legislation  must   be  carefully   tailored  to   consider  that                                                               
fundamental  right,  he  stated,  otherwise  the  legislation  is                                                               
ineffective and void.   His objection to  the [proposed] statute,                                                               
he continued,  is that it  will impede, intrude, and  burden this                                                               
right of privacy.  The legislation  is overbroad in its reach and                                                               
it's going to create many unintended consequences, he added.                                                                    
                                                                                                                                
MR. GREER suggested that this  whole matter could be addressed to                                                               
the  Uniform  Law  Commission,   comprised  of  lawyers  and  law                                                               
professors  who are  conversant  in this  area of  constitutional                                                               
law, to determine what if anything  should be done to prevent bad                                                               
actors from  using state  trust laws  to further  their purposes.                                                               
He stated that this legislation  should not be hastily passed and                                                               
urged the committee not to pass these bills.                                                                                    
                                                                                                                                
5:01:04 PM                                                                                                                    
                                                                                                                                
JAMIE  DELMAN, Esq.,  testified in  opposition to  HB 405  and HB
406.   He stated he is  a past president of  the Anchorage Estate                                                               
Planning Council  and has practiced  in estate planning  for over                                                               
11 years.   He said  he does  not want Alaska's  beneficial trust                                                               
laws to  be used by  bad actors to  steal wealth.   Therefore, he                                                               
continued,  he strongly  supports a  review of  Alaska's existing                                                               
statutory   framework  in   conjunction  with   members  of   the                                                               
legislature  to  identify  and improve  provisions  to  safeguard                                                               
Alaska's statutes against such potential bad actors.                                                                            
                                                                                                                                
MR. DELMAN  said he  is concerned  that HB 405  and HB  406 could                                                               
cause substantial harm  to Alaskans.  He stated  that in addition                                                               
to  privacy  concerns, he  is  concerned  that [the  bills]  will                                                               
create  significant open  questions that  would need  substantial                                                               
review and study to resolve.   He noted that HB 405 provides that                                                               
a trust does not become  effective or enforceable until the trust                                                               
establishment  document  is filed.    But,  he cautioned,  it  is                                                               
unknown  what  it  means  for   a  trust  to  be  ineffective  or                                                               
enforceable.   Is  an ineffective  or  enforceable trust  treated                                                               
like  a limited  liability company  that has  been dissolved,  in                                                               
which case the managers still have  an ability to wind up affairs                                                               
and transfer assets?   If that were the case  with an ineffective                                                               
trust, he argued, the trust  still effectively exists even though                                                               
it  is  considered ineffective  and  unenforceable.   Trusts  are                                                               
relationships, he said,  so to say that a  trust is unenforceable                                                               
opens the  question as to what  right cannot be enforced  by whom                                                               
and against whom.                                                                                                               
                                                                                                                                
MR. DELMAN noted  that HB 406 provides that a  trust is not valid                                                               
if an interested  party is on the  Specially Designated Nationals                                                               
and  Blocked Persons  List (SDN  List).   He said  this similarly                                                               
creates a  question of what it  means for a trust  to be invalid.                                                               
If a trust  is in existence and has one  of several beneficiaries                                                               
appearing on the list, what happens  to the property in the trust                                                               
deed's  possession?    Section  2  of HB  406,  he  pointed  out,                                                               
prohibits recording deeds to a person  on the SDN List.  However,                                                               
he  advised,  if real  property  is  transferred  and a  deed  is                                                               
delivered, that  is considered  an effective  transfer regardless                                                               
of whether it  is recorded.  So,  he warned, in a  way this would                                                               
encourage bad actors to make transfers and not record them.                                                                     
                                                                                                                                
5:04:28 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FIELDS  closed public  testimony on HB  405 and  HB 406.                                                               
He  related that  former governor  Tony Knowles  has submitted  a                                                               
letter.                                                                                                                         
                                                                                                                                
CO-CHAIR  SPOHNHOLZ  noted  that  the  Division  of  Banking  and                                                               
Securities is  the primary regulator for  Alaska trust companies.                                                               
She  requested  a  description  of  how  oversight  is  currently                                                               
managed for trusts in Alaska.                                                                                                   
                                                                                                                                
5:05:28 PM                                                                                                                    
                                                                                                                                
ROBERT  SCHMIDT, Director,  Division of  Banking and  Securities,                                                               
Department  of  Commerce,  Community,  and  Economic  Development                                                               
(DCCED),  replied   that  the  division  represents   five  trust                                                               
companies,  which   are  companies   whose  business  it   is  to                                                               
administer trusts.   The division licenses  those trust companies                                                               
and performs due  diligence on licensing them, and  once they are                                                               
licensed they are  subject to periodic examination.   During that                                                               
examination,  he  continued, the  division  is  looking at  their                                                               
operations  for safety  and soundness,  for  compliance with  the                                                               
sanctions  checklist  of the  Office  of  Foreign Assets  Control                                                               
(OFAC),  and for  compliance with  the Bank  Secrecy Act  to make                                                               
sure that the trust is looking  out for what are called Specially                                                               
Designated Nationals, persons who are on the sanctions list.                                                                    
                                                                                                                                
5:07:10 PM                                                                                                                    
                                                                                                                                
CO-CHAIR SPOHNHOLZ asked  whether, in addition to  the five trust                                                               
companies, other  financial institutions  are required  in Alaska                                                               
to comply with the OFAC sanctions list.                                                                                         
                                                                                                                                
MR. SCHMIDT responded that every  financial institution in Alaska                                                               
is required to  comply with OFAC lists and the  Bank Secrecy Act,                                                               
and he understands that there  are criminal penalties for failure                                                               
to comply.   For example, he  continued, a person opening  a bank                                                               
account  in   the  state  of  Alaska   must  provide  identifying                                                               
information to  the bank  that establishes who  the person  is as                                                               
the bank must follow what  are called "know your customers" laws.                                                               
He  said  the  five  trust companies,  the  four  state-chartered                                                               
banks,  and  the  one  state-chartered   credit  union  that  the                                                               
division  regulates are  all required  to  perform due  diligence                                                               
whenever they open any account with a new customer.                                                                             
                                                                                                                                
CO-CHAIR SPOHNHOLZ noted that because  a trust is a relationship,                                                               
not a  company, it has its  own set of legal  documents that must                                                               
be provided to the bank when  creating a new bank account for the                                                               
trust.   She  asked  whether  the bank  is  then responsible  for                                                               
comparing  trustees  and  beneficiaries of  an  individual  trust                                                               
against the OFAC sanctions list.                                                                                                
                                                                                                                                
MR. SCHMIDT answered yes.                                                                                                       
                                                                                                                                
CO-CHAIR SPOHNHOLZ  asked what a  bank's responsibility  would be                                                               
and what the  routing would be to report something  that the bank                                                               
identified.                                                                                                                     
                                                                                                                                
MR. SCHMIDT replied that the banks  are bound by the Bank Secrecy                                                               
Act and various federal laws  relative to knowing their customers                                                               
and  not making  themselves safe  havens.   He  explained that  a                                                               
person might have a common name that  shows up on the SDN List or                                                               
the  OFAC list.   There  are  then processes  and procedures,  he                                                               
continued, for clearing those false  positives that would require                                                               
confidential information,  such as date of  birth, driver license                                                               
number, and  Social Security number,  that the bank would  use to                                                               
determine whether it is dealing with a false or a true positive.                                                                
                                                                                                                                
CO-CHAIR SPOHNHOLZ  asked how  many times in  the past  few years                                                               
the division has identified individuals on the sanctions list.                                                                  
                                                                                                                                
MR. SCHMIDT deferred to Ms. Tracy Reno to answer the question.                                                                  
                                                                                                                                
5:10:51 PM                                                                                                                    
                                                                                                                                
TRACY  RENO,  Chief  of Examinations,  Division  of  Banking  and                                                               
Securities,  Department  of  Commerce,  Community,  and  Economic                                                               
Development  (DCCED), responded  that she  oversees examinations,                                                               
while the identifying factors for  OFAC are on the licensing side                                                               
under  a different  section.   She  said she  has  been with  the                                                               
division for 10 years and is  not aware of any positive OFAC hits                                                               
from a license perspective that would have required enforcement.                                                                
                                                                                                                                
5:11:18 PM                                                                                                                    
                                                                                                                                
CO-CHAIR SPOHNHOLZ drew  attention to the fiscal note  for HB 405                                                               
and noted  that there  are thousands  of trusts  in Alaska.   She                                                               
asked how  - if  a requirement  were created  that each  of those                                                               
trusts be  filed with  the Division of  Banking and  Securities -                                                               
the division  would be able  to check against the  sanctions list                                                               
on every  trust for the initial  filing plus every time  a change                                                               
was made without additional staffing.                                                                                           
                                                                                                                                
MR.  SCHMIDT answered  that  this  substantial undertaking  would                                                               
require  additional staffing  of  at least  one position  control                                                               
number (PCN).   Also, he continued, a third-party  vendor with an                                                               
automated  checking process  would need  to be  utilized for  the                                                               
necessary additional  technology because  it is impossible  to do                                                               
OFAC checks at  scale manually.  He further  advised that because                                                               
the  division   would  be  housing  sensitive   information,  the                                                               
division's systems would  need to be adequately  hardened so that                                                               
people's  information  is  not  compromised.     He  said  it  is                                                               
difficult to say what the cost of those efforts would be.                                                                       
                                                                                                                                
CO-CHAIR  SPOHNHOLZ  commented that  it  would  be a  significant                                                               
undertaking to set  up this new structure given it  has yet to be                                                               
undertaken  in  any  other  US  state.   She  asked  whether  the                                                               
division is closely tracking the  adoption of regulations related                                                               
to the Corporate Transparency Act.                                                                                              
                                                                                                                                
MR. SCHMIDT confirmed that the division is tracking those.                                                                      
                                                                                                                                
[HB 405 and HB 406 were held over.]                                                                                             
                                                                                                                                
5:13:30 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Labor and  Commerce Standing Committee  meeting was  adjourned at                                                               
5:13 p.m.                                                                                                                       

Document Name Date/Time Subjects
SB 186 Sponsor Statement 2.22.2022.pdf HL&C 4/27/2022 3:15:00 PM
SB 186
SB 186 ver. A 2.9.22.PDF HL&C 4/27/2022 3:15:00 PM
SB 186
SB 186 Fiscal Note DCCED-CBPL 3.4.2022.pdf HL&C 4/27/2022 3:15:00 PM
SB 186
SB 186 Optometry Audit June 2021 4.6.22.pdf HL&C 4/27/2022 3:15:00 PM
SB 186
SB 190 v. A 4.14.22.PDF HL&C 4/27/2022 3:15:00 PM
SB 190
SB 190 v. W Sectional Analysis 4.14.22.pdf HL&C 4/27/2022 3:15:00 PM
SB 190
SB 190 v. W Sponsor Statement 4.14.22.pdf HL&C 4/27/2022 3:15:00 PM
SB 190
CSSB 190 Fiscal Note DCCED-RCA 4.22.22.pdf HL&C 4/27/2022 3:15:00 PM
SB 190
SB 190 Support Document- Legislative Audit RCA Sunset Review 9.21.21.pdf HL&C 4/27/2022 3:15:00 PM
SB 190
CSSB 190 v. W 4.14.22.PDF HL&C 4/27/2022 3:15:00 PM
SB 190
SB 190 Explanation of Changes ver. I to W 03.25.2022.pdf HL&C 4/27/2022 3:15:00 PM
SB 190
SB 190 Explanation of Changes version A to I 4.14.22.pdf HL&C 4/27/2022 3:15:00 PM
SB 190
SB 193 Full Audit 4.11.22.pdf HL&C 4/27/2022 3:15:00 PM
SB 193
SB 193 Letter of Support 2.28.22.pdf HL&C 4/27/2022 3:15:00 PM
SB 193
SB 193 Sponsor Statement Version G 4.11.22.pdf HL&C 4/27/2022 3:15:00 PM
SB 193
SB 193 Verison G 4.11.22.PDF HL&C 4/27/2022 3:15:00 PM
SB 193
CSSB 193 (FIN) Fiscal Note DCCED-CBPL 4.22.22.pdf HL&C 4/27/2022 3:15:00 PM
SB 193
SB 193 Audit Summary 4.11.22.pdf HL&C 4/27/2022 3:15:00 PM
SB 193
SB 193 Explanation of Changes, version I to G 4.11.22.pdf HL&C 4/27/2022 3:15:00 PM
SB 193
HB 405-406 Letter of Support - Gov Tony Knowles 4.27.22.pdf HL&C 4/27/2022 3:15:00 PM
HB 405
HB 405-406 Opposition Letters 4.27.22.PDF HL&C 4/27/2022 3:15:00 PM
HB 405
HB 405-406 Letter of Support - AKPIRG 4.22.22.pdf HL&C 4/27/2022 3:15:00 PM
HB 405
HB 405-406 SupportDoc - TJN Complex Ownership Structures 4.27.22.pdf HL&C 4/27/2022 3:15:00 PM
HB 405
HB 405-406 Opposition Letters (email) 4.27.22.pdf HL&C 4/27/2022 3:15:00 PM
HB 405