01/30/2004 03:20 PM House L&C

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* first hearing in first committee of referral
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ALASKA STATE LEGISLATURE HOUSE LABOR AND COMMERCE STANDING COMMITTEE January 30, 2004 3:20 p.m. MEMBERS PRESENT Representative Tom Anderson, Chair Representative Bob Lynn Representative Norman Rokeberg Representative Harry Crawford Representative David Guttenberg MEMBERS ABSENT Representative Carl Gatto, Vice Chair Representative Nancy Dahlstrom COMMITTEE CALENDAR HOUSE BILL NO. 367 "An Act relating to the licensing and regulation of sex-oriented businesses and sex-oriented business entertainers; relating to protection of the safety and health of and to education of young persons who perform in adult entertainment establishments; and providing for an effective date." - HEARD AND HELD HOUSE BILL NO. 389 "An Act relating to certain monetary advances in which the deposit or other negotiation of certain instruments to pay the advances is delayed until a later date; and providing for an effective date." - BILL HEARING POSTPONED TO 2/4/04 PREVIOUS COMMITTEE ACTION BILL: HB 367 SHORT TITLE: LICENSING SEX-ORIENTED BUSINESSES SPONSOR(S): REPRESENTATIVE(S) MCGUIRE, GARA 01/12/04 (H) PREFILE RELEASED 1/9/04

01/12/04 (H) READ THE FIRST TIME - REFERRALS

01/12/04 (H) L&C, JUD, FIN

01/30/04 (H) WITNESS REGISTER REPRESENTATIVE LESIL McGUIRE Alaska State Legislature Juneau, Alaska POSITION STATEMENT: Testified as one of the sponsors of and answered questions. REPRESENTATIVE LES GARA Alaska State Legislature Juneau, Alaska POSITION STATEMENT: Testified as one of the sponsors of and answered questions. SCOTT SWARTZWELDER, Ph.D., Clinical Professor of Psychiatry and Behavioral Sciences Duke University Medical Center Durham, North Carolina POSITION STATEMENT: Testified on ACTION NARRATIVE TAPE 04-5, SIDE A Number 0001 CHAIR TOM ANDERSON called the House Labor and Commerce Standing Committee meeting to order at 3:20 p.m. Representatives Anderson, Lynn, Rokeberg, Crawford, and Guttenberg were present at the call to order. Representatives Gatto and Dahlstrom were excused. HB Number 0139 CHAIR ANDERSON announced that the only order of business would be HOUSE BILL NO. 367, "An Act relating to the licensing and regulation of sex-oriented businesses and sex-oriented business entertainers; relating to protection of the safety and health of and to education of young persons who perform in adult entertainment establishments; and providing for an effective date." Number 0148 REPRESENTATIVE LESIL McGUIRE, Alaska State Legislature, one of the two sponsors of HB 367. in these environments, he reported that recent scientific research shows that brain development proceeds well into a person's twenties; the brains of these individuals aren't yet at full capacity in terms of planning, decision making, problem solving, and higher order judgment. DR. SWARTZWELDER said the developing brain presents the individual with a double-edged sword of great opportunity in learning and memory capacity, but also great vulnerability to the effects of insult or damage; that damage could include head injury, exposure to alcohol and other drugs, or exposure to carbon monoxide where there is a smoking environment. He warned about the need for caution with regard to the kinds of environment that individuals in their late teens and early twenties are put into. Number 1089 CHAIR ANDERSON asked about similar judgment variables in relation to smoking at age 19 or drinking alcohol at 21. DR. SWARTZWELDER pointed out that it's known now that alcohol, for example, has a much more powerful effect on certain cognitive function in the adolescent brain than the adult brain. He said he'd be particularly worried about things like secondhand smoke exposure, carbon monoxide exposure, and other forms of trauma that a person might be at a greater risk for, in that environment. CHAIR ANDERSON noted that the sponsors had alluded to a willingness to amend this legislation so the minimum age would be 21, rather than 19, at which youths could dance in this [type of establishment]. He suggested perhaps the age of patronage should also be changed from 19 to 21, and asked Dr. Swartzwelder if he would agree with such a change. DR. SWARTZWELDER concurred. He said as a clinician and scientist, he believes the age should actually be older than [21] and that he'd support a change to the mid-twenties. Number 1222 REPRESENTATIVE ROKEBERG asked if this legislation is providing for licensing of all of the [sex-oriented businesses and entertainers] and then requiring a different set of standards for establishments for individuals under the age of 21. REPRESENTATIVE McGUIRE said that's exactly right. REPRESENTATIVE GARA commented that the only sex-oriented businesses impacted are those with entertainers who perform nude or semi-nude; this doesn't apply to adult bookstores, for example. Pointing out that most of the regulations affecting the clubs are an effort to protect minors, he noted that some massage parlors actually share an entrance with a residential unit where minors live. This legislation just says that if the place of business is where a minor will frequent, then there needs to be a separate entrance. REPRESENTATIVE ROKEBERG asked if this legislation would extend to different businesses, not only strip clubs, but massage parlors as well. REPRESENTATIVE McGUIRE responded that is correct. A business whose employees perform nude or semi-nude dancing will fall under this legislation. For example, if a massage is provided by an employee who is clothed, then there would not be any regulation. She said most states regulate these kinds of businesses, and the fact that Alaska doesn't is quite shocking. The number-one goal in regulating these businesses is how it impacts minors. It's also important to ensure that people who apply for these licenses haven't been convicted of unlawful exploitation of a minor, such as possession or distribution of child pornography or sexual assault. Number 1428 REPRESENTATIVE ROKEBERG expressed concern that this bill [delegates enforcement] under Title 8 to the Division of Occupational Licensing [under DCED], whereas the issues would be under the venue of the Department of Public Safety or the ABC Board. He asked how the fines work. REPRESENTATIVE McGUIRE emphasized that this legislation is under a separate area because a nude or semi-nude sex-oriented business is regulated by the ABC Board only because it serves alcohol; that's a separate issue already addressed by state and local law. Although there currently is regulation with respect to the use of alcohol, there is no regulation with regard to sexually oriented businesses. REPRESENTATIVE ROKEBERG observed that there would be multiple licenses required: one to serve alcohol and one to have [nude or semi-nude dancers]. REPRESENTATIVE McGUIRE agreed, saying it's no different from operating a restaurant in Anchorage, where it is necessary to have a separate business license, restaurant license, and alcoholic beverage license. REPRESENTATIVE ROKEBERG expressed concern about jurisdictional conflicts, the fiscal impact on DCED, and its ability to enforce this legislation. Number 1615 REPRESENTATIVE McGUIRE told members that if they believe licensing should be done through the Division of Occupational Licensing and enforcement should be done by another department, she'd urge them to consider that option. Referring to page 7, line 18, disciplinary sanctions, she said she doesn't see a conflict if the Division of Occupational Licensing is involved in enforcement. REPRESENTATIVE ROKEBERG agreed the division could be involved, but questioned whether it creates a burden because of the need for a hearing officer; he mentioned the right of a hearing under due process. REPRESENTATIVE McGUIRE indicated she believes [that due process] is important. Number 1655 REPRESENTATIVE LYNN moved to adopt the proposed committee substitute (CS), Version 23-LS1394\H, Craver, 1/30/04, as a work draft. There being no objection, Version H was before the committee. Number 1676 REPRESENTATIVE ROKEBERG asked if the sponsors believe there will be a constitutional challenge. He referred to pages 12-13 and asked why the state should take up this issue, rather than have the local or municipal jurisdictions regulate it. Noting that the sponsors had mentioned the Municipality of Anchorage's looking at this issue, he asked if an ordinance was passed with respect to this issue. REPRESENTATIVE McGUIRE responded that the Municipality of Anchorage passed a resolution. She said according to Assemblyman Sullivan, it was the municipality's view that this issue should be dealt with at the state level through the Division of Occupational Licensing. Representative McGuire said a severability clause is common when there is an area of potential constitutional challenge; she doesn't know of any [such challenge]. She concluded by saying she and Representative Gara believe this is an important issue that the state should handle on a statewide basis. Number 1721 REPRESENTATIVE GARA pointed out that the Division of Occupational Licensing does enforcement on any [business] that it licenses, but also charges a fee to the applicants that covers the cost of enforcement. Other enforcement will be done at the discretion of local and state law enforcement officers, and it will not be necessary for additional officers to be hired for this purpose, he said. It will be entirely up to the local authorities as to what they choose to prosecute. REPRESENTATIVE ROKEBERG surmised that in Anchorage [local law enforcement may pursue this], but nowhere else. REPRESENTATIVE McGUIRE noted that representatives of the Division of Alaska State Troopers and the Anchorage Police Department were on teleconference to share some of their experiences. Number 1881 REPRESENTATIVE GUTTENBERG recalled a pet store that he knew of when he was a kid that sold fish; the sales people were topless. It was outside the city limits and outside of any local regulation. He asked if a business like that would be covered under this bill. REPRESENTATIVE GARA responded that if the purpose of the nudity is to entertain, then the [establishment] would be regulated. REPRESENTATIVE GUTTENBERG directed attention to page 4, line 19, where wage-and-hour laws are addressed. He asked if these businesses have been exempt from wage-and-hour laws in the past. REPRESENTATIVE GARA replied that a lot of younger employees do not know their rights. There has been [testimony] from individuals who have worked in these establishments who have been very badly abused on the wage-and-hour front. He added that most of the people who work in these places are not employees; they are classified as independent contractors, as if they have control over their jobs. Then these youths are charged for using stage time and bar time. Number 1975 REPRESENTATIVE GUTTENBERG asked if there is a supreme court decision on topless dancers in Alaska. REPRESENTATIVE GARA said he isn't sure. He added that this bill doesn't change the wage-and-hour laws. It says the Division of Occupational Licensing will tell these establishments where violations are frequent, that one requirement is that employees must be told their job rights. REPRESENTATIVE McGUIRE explained that these requirements are bifurcated for sex-oriented business license holders, and this would apply to businesses for both 18- to 21-year-olds and 21- years-old and older. The license holders who deal with under- Number 2014 REPRESENTATIVE LYNN asked if it's true that the municipalities have not addressed this issue. [Alluding to a recent resolution by the Conference of Mayors stating "no confidence" in the legislature] he asked whether the legislature should pass a resolution of no confidence of the municipalities. REPRESENTATIVE McGUIRE responded that she wouldn't support a resolution of no confidence. She added that the Municipality of Anchorage changed a zoning ordinance and said the state is a better-suited entity to address this problem through licensing. The Fairbanks city council did the same thing, she added. REPRESENTATIVE LYNN said he agreed with Representative McGuire. Number 2053 REPRESENTATIVE ROKEBERG noted that Representative Lynn made a good point. He suggested that an amendment be offered to make this a mandate of municipal governments. CHAIR ANDERSON summarized that this bill is about training, licensure, and elevating the [nude] dancing age to 19. He noted that he's considering an amendment that says an individual must be 21 [years of age] to dance [nude], or 21 to enter the facility where there is [nude] dancing. Number 2083 KARA NYQUIST, Director of Advocacy, Covenant House Alaska ("Covenant House"); Alaska Association of Homes for Children, testified in support of HB 367. providers throughout Alaska who collectively serve tens of thousands of youths each year. She said all of these providers shared bad experiences that their clients had experienced in strip clubs that employ individuals under the age of 21. Number 2128 MS. NYQUIST said she is an attorney and has been working closely with Representatives McGuire and Gara on this bill. Currently under Alaska law, it is [legal] for an 18-year-old to become a nude dancer or patronize clubs that employ nude dancers. The Alaska Supreme Court and the U.S. Supreme Court have recognized that dancing, including nude dancing, is a form of expression under the First Amendment to the U.S. Constitution, she said; the Alaska Supreme Court case is Mickens v. City of Kodiak, a MS. NYQUIST reported, however, that both courts have recognized that rights protected by the First Amendment aren't immune from government regulation and that content-neutral restrictions that are reasonably aimed at addressing the secondary effects of the "speech" - and not the "speech" itself restrictions in the courts are referred to as "time, place, and manner restrictions." The Alaska Supreme Court case that discusses these restrictions is Seward Chapel, Inc. v. City of Seward, a 1982 case. MS. NYQUIST went on to say the U.S. Supreme Court has specifically recognized that the local governments have a right and duty under their police powers to regulate sexually oriented businesses (SOBs) and to control where, when, and how these businesses will locate and operate, in order to minimize adverse secondary effects. She noted that the two U.S. Supreme Court cases [that address this issue] are Young v. American Mini Theaters, Inc. and City of Renton v. Playtime Theaters, Inc. MS. NYQUIST explained that the harmful secondary effects that have been recognized by the U.S. Supreme Court - which are currently occurring in Alaska and about which the committee will hear testimony today - are increased crime, which includes prostitution, drug use, and sexual assaults; decreased property values in locations near these clubs; increased potential for the spreading of sexually transmitted diseases; sexual harassment; pills left in the parking lot that could be accessed by anyone in the community; sexual exploitation of minors; and wage-and-hour law violations. MS. NYQUIST reported that the U.S. Supreme Court has held that curbing these secondary effects constitutes a substantial government interest, and that the legislative record should include evidence available on these [secondary] effects; the record should be composed of any reports or studies that have been prepared by government agencies, any regional or national information about the experiences, and testimony at hearings. Number 2230 MS. NYQUIST highlighted that the U.S. Supreme Court has said communities may rely on the past experiences of other communities, and may consider the studies and reports of harmful effects without generating their own new studies in their localities, in the case of City of Renton v. Playtime Theaters, Inc. MS. NYQUIST also reported that the legal staff at the National Law Center for Children and Families have expressed that they are unaware of any jurisdiction that has held age restrictions unconstitutional when the government feels there is a substantial interest in regulating sexually oriented businesses. She said the only case she came across where an age restriction was struck down was an instance when a court found that a legislature had not made a record of why that age restriction was necessary. That case was in the 10th Circuit Court [of Appeals], Essence, Inc. v. City of Federal Heights. Number 2283 CHAIR ANDERSON surmised that if the legislature has substantive rationale to raise the age level because of issues of sexual assault, harassment, drug [abuse], wage-and-hour violations, and other issues that will be covered in testimony by the Department of Public Safety, then that would be a good enough record to afford the age-limit increase and would not be deemed unconstitutional. MS. NYQUIST agreed. She said the organizations she represents support HB 367 currently taking place and children are being exploited. Former dancers have expressed to her that they've worked in strip clubs in Anchorage where they were not paid an hourly wage, but were required to pay $50 a night to work at these clubs. The dancers were encouraged to perform lap dances with no clothing on and to engage in prostitution, and had to endure unsanitary health conditions in clubs where young women and men were required to share uniforms and expose their genitals to stages that weren't cleaned regularly. MS. NYQUIST said that, reportedly, drugs are also freely available. Tobacco use occurs, although under Alaska state law, an individual must be 19 to use tobacco. Other dancers have told her that 16-year-olds are employed in these clubs by using fake identification to get jobs. Ms. Nyquist said some women have expressed to her that they don't feel safe saying no to some of the requests made by the owners, but don't feel there are other employment options in the community. Others have reported that because of the existence of bodyguards and pimps that frequent the clubs, the women do not feel safe. Number 2357 MS. NYQUIST said the health clinic at Covenant House has reported that these youth are at high risk of contracting STDs [sexually transmitted diseases] and AIDS [acquired immunodeficiency syndrome] and spreading them throughout the Anchorage community. Citing health and safety concerns, she encouraged lawmakers to support this bill to prevent others from preying on children. TAPE 04-5, SIDE B Number 2370 MS. NYQUIST conveyed her belief that it is important to regulate this industry that has fallen through the cracks of the legal system. Jurisdictions across the country are regulating sexually oriented businesses, she said. She encouraged members to ensure that both employees and patrons of strip clubs are at least 19 [years old], if not older. The agencies she represents aren't making a moral argument or asking for any constitutional rights of youths to be stepped on, but ask the members to recognize the dangers that exist and the secondary effects of these clubs, she said; she believes the legislature has a duty to create regulations that will protect the health and safety of communities, and especially children. The activities she described today do not occur in every club in Anchorage, she noted, but need to be regulated. Number 2311 REPRESENTATIVE LYNN asked if the police have been involved in investigating these activities. If not, he asked Ms. Nyquist if she knew why no investigations have occurred. MS. NYQUIST responded that she met with Chief Monegan [of the Anchorage Police Department] and requested enhanced enforcement. There may be some undercover investigations taking place, and there may be an Anchorage Police Department detective available to testify on teleconference. She added that she doesn't know of any "stings" or recent charges relating to all the illegal activity that is going on. Representative Samuels sent a letter to the Anchorage Police Department requesting increased enforcement, she said, but she doesn't know of any additional efforts that have occurred. Number 2274 REPRESENTATIVE LYNN asked what is being done by the owners of these clubs to address the issue of employment of underage girls. MS. NYQUIST said her understanding is that the only requirement by these employers to ascertain the age of an employee is to look at picture identification. She said the current strippers that she has talked to are not receiving any wage-and-hour [compensation] in these establishments; thus there are no forms completed to verify their ages. She said normally employees must show their social security card, passport, or some other picture identification, but she doesn't know if this information is being gathered. This bill would require dancers to register with the state so that their ages may be verified, she added. Number 2220 REPRESENTATIVE LYNN asked Ms. Nyquist if she knew the age of the patrons who go to these clubs. Specifically, are older people going to these clubs to see entertainment by underage girls? MS. NYQUIST responded that there are a variety of patrons; older adults, pimps, and some high school students frequent the clubs. REPRESENTATIVE LYNN voiced concern for the health of these girls and asked if there is any requirement for a health examination before obtaining a license. He pointed out that teachers and food service workers are tested for tuberculosis. He asked whether it might be appropriate to be tested for STDs before being licensed. MS. NYQUIST replied that the bill doesn't require medical exams because there is a concern of privacy. She said national studies have reported that these types of clubs do cause increases in the spread of STDs; that is why the bill includes language that requires education about exposure to STDs. Number 2134 REPRESENTATIVE LYNN commented that in the past when he applied for employment and was required to have a medical examination, the employers were not concerned with his privacy. He asked if the bill addresses the prohibition of a person under 21 who has a previous conviction of prostitution. MS. NYQUIST replied that language in the bill discusses whether or not dancers or owners of the clubs can have previous felony convictions. REPRESENTATIVE LYNN asked if prostitution is a felony. MS. NYQUIST indicated she wasn't certain. REPRESENTATIVE ROKEBERG said he believes it is a misdemeanor. Number 2066 REPRESENTATIVE CRAWFORD noted that his wife worked for several years at the Center for Drug Problems in Anchorage, was the director of the Stop AIDS Project, and is a mental health counselor in Anchorage; he said she would agree with everything Ms. Nyquist said today. Representative Crawford said he believes it is high time that the legislature regulate these strip clubs. REPRESENTATIVE ROKEBERG complimented Ms. Nyquist on her legal research and asked if she would make her comments and legal citations available to the committee. He said he has a concern about the notion of enacting statutes that sanction this activity and the message that it sends. He asked Ms. Nyquist what she believes are the legal tensions in prohibiting this activity for someone under 21 [years of age] and the First Amendment. MS. NYQUIST responded that the state has an interest in health and safety concerns to enact regulations to protect its citizens. While there is a First Amendment right as to form of expression, there are "time, place, and manner restrictions" as long as there isn't a regulation to restrict the content, just the secondary effects. MS. NYQUIST offered her understanding that the drafters of this bill didn't intend to make a moral judgment or prevent people from nude dancing, but wanted to address the effects of the industry on the community. The court says that if the government determines these industries have a harmful effect on the community, it has the right to regulate those industries, she added. Number 1935 REPRESENTATIVE ROKEBERG asked Ms. Nyquist to comment on prohibiting this activity. MS. NYQUIST responded that prohibiting and regulating these industries go hand-and-hand in that individuals under the age of activity isn't being prohibited for all individuals, just those of a certain age. In further response, she indicated she doesn't know of any court that has said it's unreasonable to prohibit individuals younger than 21 years of age from taking part in this activity. REPRESENTATIVE ROKEBERG asked what Covenant House's cooperation level has been with the Anchorage Police Department. MS. NYQUIST responded that Covenant House has a good working relationship with the police department. There are fiscal costs of enforcement, and priorities in enforcing certain crimes. For example, only one police officer in Alaska works on cases involving runaway and missing children, and yet there are more than 200 kids on that list. Ms. Nyquist added that it is fair to say this area of the law is not strictly enforced. That is another reason there is a need to restrict these activities and prevent the harm that is taking place. Number 1805 REPRESENTATIVE ROKEBERG asked Ms. Nyquist if it is her belief that the bill before the committee is a shift of the responsibility of enforcement from current [local] laws or lack of laws from one agency of the government to another, due to the lack of police [enforcement]. MS. NYQUIST responded that she believes this is not a shift in responsibility, but a dual role: a role of enforcement and a role of state law. Other jurisdictions are regulating these industries. It is not because law enforcement [officials] are not enforcing laws in these areas, she added; it is because additional protections are needed. REPRESENTATIVE ROKEBERG commented that historically there have always been teenage nightclubs in the Anchorage area; however, the nudity aspect is a more recent phenomenon. He asked if Ms. Nyquist could make a distinction between gathering places for youths - those with nudity and those without it. Representative Rokeberg clarified by saying that teenage nightclubs would be permitted; however, nudity wouldn't be. If this bill were enacted, there would still be a teenage nightclub phenomenon, he said, and asked whether this bill is just a small, incremental improvement for teenagers or is a major step. MS. NYQUIST replied that she believe it's a substantial step. This isn't an effort to regulate nudity; it's to regulate the secondary effects of what is occurring at these types of clubs. Studies and testimony will show that there is illegal activity going on such as prostitution and exploitation, and that is what the bill would try to regulate. REPRESENTATIVE ROKEBERG asked if she believes those activities would take place whether there is nudity or not. MS. NYQUIST responded that there is an increase in activity due to nudity. It has been reported that men have been more likely to fondle the women and that more prostitution takes place because the nudity exists in those types of locations, and more people are seeking to engage in prostitution because it is believed to be acceptable. Number 1612 REPRESENTATIVE McGUIRE told the members that the two clubs in Anchorage that have stripping by youths between the ages of 18 and 21 and that don't serve alcohol are not, in fact, underage clubs. That is a different and distinct phenomenon. There are clubs where youths can go and dance and drink soda pop, she said, but these clubs are completely different. The clubs that are being discussed are entirely set up around nude and semi- nude dancing by youths between 18 and 21 and the patrons that come there; those patrons could be youths themselves or they could be "dirty old men." It is a separate activity from the youth clubs that Representative Rokeberg is talking about. REPRESENTATIVE McGUIRE said the studies Representative Gara has read provide evidence that when there is nude and semi-nude dancing and minors are involved, the secondary effects are things like forced prostitution, assault, drug use, and exposure to intimidation and force. When there is a constitutional implication, it is important to clarify what is being said. Ms. Nyquist was not suggesting banning all nude or semi-nude dancing, Representative McGuire said, but the state wants to regulate it and, in fact, include a provision that says an individual may not do it until the age of 21. Number 1520 CHAIR ANDERSON asked Representative Gara if is true that one of the impetuses behind this legislation is that there are dancers and patrons who are still in high school or members of the military. He asked Representative Lynn if he could comment on the military's position on this, as he understands that the military does not condone these activities. MS. NYQUIST responded that the military has banned all pornography on base, and has publicly announced that it doesn't want officers to go to any pornographic locations. REPRESENTATIVE GUTTENBERG asked if cases that have been documented around the country that are [discussed in this meeting] are sufficient to meet [the constitutional standard]. He asked: What part of the record do these cases need to be? MS. NYQUIST replied that the committee cannot just look at [what has happened in] other localities; however, it is important to look at studies, national testimony, and local testimony on what is going on in communities [in Alaska]. That record should be in committee meetings, as is being done today. She added that committee members either here or in the House Judiciary Standing Committee may want to adopt a preamble that would say what type of information was gathered to support the legislation. Number 1383 REPRESENTATIVE GUTTENBERG asked if one clinical neuropsychologist's testimony is [substantial enough] to support this case. MS. NYQUIST responded that there is no case law that says exactly how much evidence is needed. However, in other U.S. Supreme Court cases, the court has said it is not necessary to create new studies within the community; it is sufficient to look at studies from other communities, but there should also be testimony. It does not specify how many people should testify, she added, but it should be sufficient evidence that the realities of the secondary effects exist in the community. REPRESENTATIVE GUTTENBERG asked if Ms. Nyquist if she believes this [legislation] is covering everything. He said he believes there is a U.S. Supreme Court decision which defines that these dancers are not contract employees. Representative Guttenberg commented that this is an industry of abuse. MS. NYQUIST reiterated secondary effects: increased crime, prostitution, drug use, and sexual assaults; decreased property values; and increased potential for sexually transmitted diseases, sexual harassment, exploitation of minors, and violations of wage-and-hour laws. REPRESENTATIVE LYNN asked how prevalent male dancers are at under-21 clubs, and whether there any unique problems that might be encountered. MS. NYQUIST said she doesn't have exact statistics on the number of male and female dancers. At Covenant House there has been communication with both. She said the fact that there are both does not decrease the fact that there are prostitution activities going on with both. Ms. Nyquist added that she doesn't know of any distinction between the two. REPRESENTATIVE LYNN asked if the male and female dancers perform individually or together. MS. NYQUIST said she believes the performances are individual; however, she didn't have specific information. Number 1264 REPRESENTATIVE CRAWFORD asked how these individuals are not covered under wage-and-hour [laws] in some way. Are these individuals considered independent contractors and thus it would be necessary to have individual business licenses to perform? Is there any way to track who these people are and whether taxes are being paid [on their income]? MS. NYQUIST agreed that the current situation is outrageous. She noted that a former dancer was available to testify. Ms. Nyquist said the reality is that these people are not being tracked and that there are violations of the wage-and-hour laws. CHAIR ANDERSON asked if anyone from the industry opposed this bill and would like to testify. [There was no response.] Number 1143 NANCY FAIR, Parent-Teacher-Student Association, Service High School, testified in support of HB teens and our communities. Over 250 other cities and states have similar licensing laws. Business and employee licensing would help ensure that underage teens are not involved. We have had numerous reports about this problem in Anchorage and Fairbanks. Number 0989 MS. FAIR continued: The benefit of business licensing: as Representative Rokeberg has pointed out, enforcement is a tough problem for our state. Many laws are being broken, but we do not have the enforcement to take care of those violations. With licensing is a powerful incentive to ensure that these SOBs obey the laws, because if they do not, they can lose their license. That is a powerful incentive to ensure they follow existing laws related to illegal drugs, alcohol, prostitution, wage-and-hour, worker safety, sexual harassment and tax evasion. This is a big cash economy, and people get paid under the table. Tax evasion has been documented as a big problem nationally. Violations of these laws have been documented in other states, and we have reports of the same here. Many cities have documented a higher rate of sex crimes in the vicinity of SOBs. The good news is that many cities have been able to reduce their crime rate by implementing stronger laws and enforcement of SOBs. In fact, Oklahoma City had a dramatic drop in rape rates when they reduced the number of SOBs and more tightly controlled them. With Alaska's high sexual assault rate, I believe that is very important. Number 0915 MS. FAIR continued: Employee licensing requirements would ensure that dancers are aware of laws and practices to protect their own health, safety, and welfare. Specifically, educating dancers about the state wage-and-hour laws would help curb violations. A side effect of this is that without adequate wages, employees may be tempted to engage in illegal activities. Education about assaults and self-defense would help dancers who are often victims of assault. An extremely high rate of verbal, physical, and sexual abuse of dancers by patrons was documented in a study from the University of Minnesota, which Representative Gara shared. It is reported in Anchorage. One former Anchorage teen dancer reported being grabbed by patrons and smacked by one when she wouldn't go home with him. With Alaska leading the nation in sexual assaults, this educational provision is important. Licensing requirements in quite accurate. I have had occasion to speak with some of the employees, female dancers, some of them young, who are basically exploited by these types of businesses. It's almost a type of servitude that they end up in. Some of the owners of these type of establishments also house these girls in different places, motels, apartments, that they have in the city. So, not only are they paying to work there, but they are paying to live there. I have had experience where their personal belongings have been held if they fall into disfavor with the establishments. It's a pretty miserable existence that they have. The types of crime they are exposed to, and the types of crimes that occur, and the people that are attracted to these types of establishments, are not healthy. Number 0442 GERARD ASSELIN, Officer, Anchorage Police Department, Municipality of Anchorage, testified: I have been an officer with the Anchorage police for about six and a half years. During that time, I have been assigned to a drug unit, and now [I am] currently assigned to the special assignment unit, which is with the Anchorage Police Department. It's a unit of four officers and one sergeant, and our primary responsibilities lie around investigations involving street-level drugs, prostitution, gambling, and things that we have actually been speaking about through the course of the testimonies here. Specifically, with regards to investigations into this type of activity, there has been testimony regarding the secondary types of crimes that occur. Again, as Officer Paiz noted, we do support [HB ADJOURNMENT There being no further business before the committee, the House Labor and Commerce Standing Committee meeting was adjourned at 5:20 p.m.

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