02/23/2009 03:15 PM House LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| HB29 | |
| HB108 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 29 | TELECONFERENCED | |
| *+ | HB 108 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE LABOR AND COMMERCE STANDING COMMITTEE
February 23, 2009
3:22 p.m.
MEMBERS PRESENT
Representative Kurt Olson, Chair
Representative Mark Neuman, Vice Chair
Representative Mike Chenault
Representative John Coghill
Representative Bob Lynn
Representative Robert L. "Bob" Buch
Representative Lindsey Holmes
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 29
"An Act increasing the minimum wage; and providing for an
effective date."
- HEARD AND HELD
HOUSE BILL NO. 108
"An Act relating to real property foreclosures, to the sale of
property on execution, and to deeds of trust."
- HEARD AND HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 29
SHORT TITLE: ALASKA MINIMUM WAGE
SPONSOR(s): REPRESENTATIVE(s) OLSON
01/20/09 (H) PREFILE RELEASED 1/9/09
01/20/09 (H) READ THE FIRST TIME - REFERRALS
01/20/09 (H) L&C, FIN
02/23/09 (H) L&C AT 3:15 PM BARNES 124
BILL: HB 108
SHORT TITLE: PROPERTY FORECLOSURES AND EXECUTIONS
SPONSOR(s): REPRESENTATIVE(s) RAMRAS
02/02/09 (H) READ THE FIRST TIME - REFERRALS
02/02/09 (H) L&C, JUD
02/23/09 (H) L&C AT 3:15 PM BARNES 124
WITNESS REGISTER
JENNIFER SENETTE, Staff
Representative Kurt Olson
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Testified on behalf of the prime sponsor of
HB 29, Representative Kurt Olson, Chair, House Labor and
Commerce Standing Committee.
CHRYSTAL SCHOENROCK
4Lands Bar
Nikiski, Alaska
POSITION STATEMENT: Testified during the discussion of HB 29.
LARRY HACKENMILLER
Fairbanks, Alaska
POSITION STATEMENT: Testified and answered questions during the
discussion of HB 29.
JOHN BROWN, Retired
Fairbanks, Alaska
POSITION STATEMENT: Testified in support of HB 29.
MARIE DARLIN, Coordinator
AARP Capital City Task Force
Juneau, Alaska
POSITION STATEMENT: Testified in support of HB 29 and answered
questions during the discussion of HB 29.
REPRESENTATIVE JAY RAMRAS
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Testified and answered questions during the
discussion of HB 108.
JANE PIERSON, Staff
Representative Jay Ramras
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Testified on behalf of the prime sponsor,
Representative Jay Ramras and answered questions during the
discussion of HB 108.
STEPHEN ROUTH, Attorney
Routh & Crabtree, APC
Anchorage, Alaska
POSITION STATEMENT: Testified and answered questions during the
discussion of HB 108.
ROBERT SCHMIDT, Attorney
Anchorage, Alaska
POSITION STATEMENT: Testified in support of HB 108.
ACTION NARRATIVE
3:22:42 PM
CHAIR KURT OLSON called the House Labor and Commerce Standing
Committee meeting to order at 3:22 p.m. Representatives Buch,
Coghill, Holmes, Neuman, and Olson were present at the call to
order. Representatives Lynn and Chenault arrived as the meeting
was in progress.
HB 29-ALASKA MINIMUM WAGE
3:23:07 PM
CHAIR OLSON announced the first order of business would be HOUSE
BILL NO. 29, "An Act increasing the minimum wage; and providing
for an effective date."
3:23:48 PM
JENNIFER SENETTE, Staff to Representative Kurt Olson, Alaska
State Legislature, on behalf of the prime sponsor,
Representative Kurt Olson, offered to present the bill. She
provided background information on the minimum wage in Alaska.
She explained since 1959 Alaska's minimum wage has been higher
than the federal level due to the cost of living in Alaska. She
offered that on July 24, 2009 the federal minimum wage will
increase to $7.25 per hour. Currently, Alaska's minimum wage is
$7.15 per hr. Thus, if the minimum wage in Alaska is not
increased, the minimum wage in Alaska will fall below the
federal level.
MS. SENETTE explained that HB 29 would set the minimum wage at
$7.15 or .50 cents higher than the federal minimum wage. Thus,
the proposed change in HB 29 would effectively change Alaska's
minimum wage to $7.75 per hour. She related almost 9,000
Alaskans earn under $7.75 per hour and would benefit from this
bill. An Alaskan working full time at the current minimum wage
falls earns $15,000 per year, which is just above the federal
poverty level. However, if the person earning minimum wage has
a family, the person would often fall below the poverty level.
She offered that increasing the minimum wage in Alaska under
this bill would add approximately $100 to each minimum wage
holder's monthly paycheck.
MS. SENETTE pointed out Alaska has not increased its minimum
wage since 2002. In 2003, Alaska's minimum wage was the highest
in the nation, but Alaska dropped to the 11th highest in 2008,
and if unchanged will drop to 21stin the nation. She opined
that the price of goods has continued to rise while wages have
remained stagnant. Thus, Alaska is losing ground compared to
other states' wages. Alaskan workers "are feeling the pinch"
she stated. She further opined that HB 29 would help vulnerable
Alaskans by placing Alaska's minimum wage at its historical
level. She mentioned that since introducing HB 29, the
committee has had an outpouring of feedback throughout Alaska
from people who support or oppose the bill. She remarked that
the minimum wage affects many Alaskans. She stated she
anticipates a committee substitute would be introduced to
address issues that have been raised.
3:27:18 PM
CHAIR OLSON explained HB 29 mirrors a bill that died during the
last legislature. He stated that no changes have been made to
last year's bill. He recalled Representative Gara and Crawford
were joint prime sponsors of the previous bill and helped
develop last year's committee substitute, which dropped off
inflation proofing. He said he hopes to address prior issues
that were identified in the bill.
3:28:52 PM
REPRESENTATIVE COGHILL recalled several factors are tied to the
minimum wage in Alaska, including wages for those who drive
school buses. He inquired as to the formula for establishing
minimum wages in Alaska.
MS. SENETTE recalled school bus drivers are included in the
formula but she was not certain of other factors.
CHAIR OLSON recalled school bus drivers were paid a multiple of
the wage, such as two or three times the minimum wage.
CHAIR OLSON, in response to Representative Coghill, stated Ms.
Senette could acquire more information for the committee at the
next hearing.
3:30:27 PM
CRYSTAL SCHOENROCK, 4Lands Bar, stated she was speaking on
behalf of herself. She related she is also a member of the
Kenai Peninsula Alaska Cabaret, Hotel, Restaurant and Retailers
Association (CHARR) and National Federation of Independent
Business (NFIB). She offered that she is somewhat against the
minimum wage since she has a number of part-time employees. She
opined it will make it hard on the employer to make up the
difference in wages since business is slow. She further opined
that she cannot afford to lose help and does not want to layoff
any employees. She surmised if she must layoff employees, the
employees would probably have to draw unemployment insurance and
possibly resort to public assistance.
MS. SCHOENROCK said she cannot afford to take any more loss or
to pay additional wages. She expressed concern that the Kenai
Peninsula has been impacted by the closure of the Agrium Inc.
plant, and with fewer tourists due to increases in fuel costs.
She offered her understanding of the issues surrounding minimum
wages, but reiterated she could not afford to pay additional
wages. She mentioned shipping costs have also increased. She
concluded by saying, "I'm kind of in a tight bind here."
3:33:02 PM
LARRY HACKENMILLER stated he was representing himself but noted
he is also a member of the NFIB and ICHARR. He related that HB
29 is another minimum wage bill. He stated one good thing is
that HB 29 does not connect wages to the consumer price index
(CPI). He noticed that the bill proposes a 50 cent increase,
which is the lowest wage increase for bills of this type. "That
doesn't make it a good bill; just two good points in a bill," he
said. He opined that when discussing the poverty level, that he
assumed the federal rate of $7.15 per hour is the basis for
comparison. He offered that the federal rate was enacted years
before the economy and fuel cost issues arose. He said, "It's a
bad time to basically raise anything." He described his own
experience, such that his son worked as a luggage person for one
of the tour companies and earned the minimum wage, but he lived
also at home. He said he did not know how many others shared
his experience.
MR. HACKENMILLER surmised that employees in the food and
beverage industry receive tips and make well above the $15,000
per year. He related his understanding that during prior
hearings it was difficult to determine how many people were
married who held minimum wage jobs. He expressed concern that
tip credits cannot be used to calculate the minimum wage and he
expressed interest in learning the reasoning behind that
exclusion. He further opined that tips help keep the industry
low in terms of employer costs. He said he did not believe
employees who also earn tips are making less than poverty level
wages. He mentioned that the employer must pay taxes on the
wages. In closing, Mr. Hackenmiller summarized that HB 29
contains "two good points and the one bad point".
3:36:32 PM
JOHN BROWN stated that he is currently retired. He offered his
support for HB 29. He said, "It's time." He opined that the
median family income has not kept up with inflation for almost
35 years. He asserted that to maintain a vibrant economy
requires decent wages. He said, "It amazes me when I hear CHARR
come down here and keep wages suppressed when most all of them
are dependent on discretionary money to come into their
businesses. It's just...they should be coming down here
screaming for people to get wage increases." He related that
unfortunately it is not possible to police tip wages. He
recalled talking to an employee who works for a pizza place who
hardly receives tips, so the employee relies only on the minimum
wage. He said he believes HB 29 should have a consumer price
index (CPI) escalator in the bill. He opined what the U.S.
needs is to have 150 million people earning decent wages and
benefits. He said he hopes HB 29 will pass so Alaska can move
on to a brighter future. He concluded by stating the U.S. needs
to rebuild its economy "with real money."
3:39:18 PM
MARIE DARLIN, Coordinator, AARP Capital City Task Force, offered
to speak in support of HB 29. She explained that Alaska has the
highest cost of living in the nation, and generally Alaska's
minimum wage has been higher than the federal minimum wage. She
emphasized that Alaska also has an aging population. She
surmised that due to the higher cost of living and problems with
investment losses, many older citizens will continue to work.
Thus, the AARP supports the increase for minimum wage. She
pointed out members should have received a copy of the
publication, "Senior Snapshot" which provides information on the
number of seniors, ages 60 years or older who live in members'
districts, along with economic status. She said she thought the
information would help legislators determine how many people
will be affected by the minimum wage in Alaska. She surmised
that Alaska is number one in the nation for the number of
citizens aged 60 or higher.
3:42:13 PM
MS. DARLIN, in response to Representative Neuman, advised that
she believes the number of senior citizens living in Alaska
represent over $1.5 billion dollars in income. She reminded
members that seniors are valuable to Alaska since they spend
their money in the communities in which they reside and also
provide volunteerism in Alaska. She opined that currently many
seniors cannot afford to travel due to the higher cost of
travel. In further response to Representative Neuman, Ms.
Darlin opined that lower income seniors spend their whole
paychecks.
3:44:01 PM
MS. DARLIN, in response to Representative Buch explained the
statistics were compiled from a McDowell Survey performed a few
years ago that examined seniors. She offered her belief that
the study can be found on the Alaska Commission for Aging
website at http://www.hss.state.ak.us/acoa/publications.htm, and
noted the "Senior Snapshot" can also be found on the website's
main page.
REPRESENTATIVE COGHILL recalled previous testimony revealed
about 9,000 people would depend on the minimum wage. He
inquired as to whether Ms. Darlin knew how many seniors will
depend on minimum wages. He stated he would seek the
information from the website.
3:45:57 PM
CHAIR OLSON announced that he would keep public testimony open
on HB 29.
3:46:25 PM
REPRESENTATIVE NEUMAN inquired as to whether Alaska's minimum
wage would always be 50 cents per hour higher than the federal
minimum wage if HB 29 passes.
CHAIR OLSON answered yes.
3:47:03 PM
HB 108-PROPERTY FORECLOSURES AND EXECUTIONS
CHAIR OLSON announced that the final order of business would be
HOUSE BILL NO. 108, "An Act relating to real property
foreclosures, to the sale of property on execution, and to deeds
of trust."
3:47:15 PM
The committee took an at-ease from 3:47 p.m. to 3:48 p.m.
3:48:33 PM
REPRESENTATIVE JAY RAMRAS, Alaska State Legislature, introduced
his staff, Jane Pierson. He explained that the Alaska Housing
Finance Corporation (AHFC) recently presented before the House
Economic Development, Trade, and Tourism. Thus, he said he is
happy to report to the committee that the housing market in
Alaska is strong, and foreclosures are at a historically low
rate. He mentioned that one issue that remains is how to treat
the equity in situations in which a homeowner has a significant
amount of equity and faces foreclosure. He opined banks often
become interested only in "making themselves whole" without
concern for the homeowner's equity during real estate
foreclosures. He related his interest is to create a
marketplace with multiple interested buyers instead of one
interested buyer, which is often the bank. He surmised that
when multiple buyers are interested in foreclosure property,
that the homeowner who is defaulting on his/her loan will obtain
a better price for the home.
3:50:50 PM
REPRESENTATIVE RAMRAS offered that when a homeowner loses
his/her home, at least if the owner obtains a decent return the
person could have a "small nest egg to restart life". He
pointed out that the language in this bill passed the House in
the 25th Legislature, as House Bill 163 but some questions
subsequently arose could not be resolved during the remainder of
the legislative session and the bill died.
3:51:31 PM
REPRESENTATIVE BUCH recalled House Bill 163 when it came before
the legislature last year. He said he appreciated the sponsor
coming forth by reintroducing the bill. He related his
understanding that the state has an outdated method for
advertising. He inquired as to whether the intent of the bill
is to upgrade the means to disseminate information to the
public.
REPRESENTATIVE RAMRAS agreed. He opined that people have
migrated from using classified advertising to website lists like
"Craig's List."
REPRESENTATIVE RAMRAS, in response to Representative Holmes,
explained the version of House Bill 163 that passed the House
last legislature is the starting point for HB 108.
3:53:53 PM
REPRESENTATIVE COGHILL recalled that timing, at the time of the
sale, was raised as an issue during foreclosures.
REPRESENTATIVE RAMRAS agreed.
REPRESENTATIVE RAMRAS, in response to Representative Neuman,
explained the idea for the bill came about when an attorney,
Stephen Routh, identified what he believed was a flaw in the
foreclosure process. Additionally, Representative Ramras
recalled other parties expressed concern that perhaps Mr. Routh
would "have an angle". However, he recalled that some of his
own best ideas have come from first-hand experiences. He opined
that HB 108 is meant to provide protection of excess equity for
homeowners. He related a scenario in which a home whose value
is $100,000 and a person owes $50,000 on the home. He offered
that the remaining money represents the homeowner's equity. He
related when a bank "buys out" the borrower during foreclosure,
the homeowner who defaulted on the loan will not gain access to
the equity.
3:57:13 PM
REPRESENTATIVE RAMRAS, in response to Representative Neuman,
explained when a bank is the only buyer, the bank will only seek
what is owed on the loan. However, if three buyers were
interested in purchasing the home under foreclosure, a bidding
process would ensue, he explained.
3:58:04 PM
JANE PIERSON, Staff, Representative Jay Ramras, Alaska State
Legislature, responded to Representative Neuman by stating
Section 10 describes how proceeds are to be distributed. She
read a portion of proposed AS 34.20.080(f)(1), as follows:
(1) the beneficiary of the deed of trust being
foreclosed until the beneficiary is paid the full
amount that is owed under the deed of trust to the
beneficiary;
(2) the persons who held, at the time of the sale,
record interests, except easements, in the property...
MS. Pierson interpreted these paragraphs to mean that the
interests shall be made whole and the higher priority shall be
satisfied before distribution is made to the recorded interest.
Thus, once those that are owed, aside from the owner, get their
share, the remainder goes to the previous owner of the house,
she related.
3:59:55 PM
MS. PIERSON reviewed the sectional analysis of HB 108, as
follows:
Section 1. removes the posting requirements at the
U.S. Post Office.
Section 2. Adds notice of execution of sale of
property also be noticed on the Internet website and
describes the requirements that the website must meet
to qualify.
Section 3. Amends AS 09.35.142 to allow an Internet
website owner to bring a court action to establish
that the website qualifies under AS 09.35.140(b)
Section 4. Amends AS 34.20.070(b) to adjust to 90 days
the minimum length of time that must elapse between
recording a notice of default on a deed of trust and
holding the foreclosure sale. Sets a limit of two days
(before a foreclosure sale) when certain defaults on a
deed of trust may be cured by a specific payment.
4:01:12 PM
MS. PIERSON continued to review the sectional analysis of HB
108, as follows:
Section 5. Amends AS 34.20.070(c) requires that
possession be actual physical possession where
possession is required for certain persons to be
entitled to receive a notice of default for
foreclosure sale.
Section 6. Adds new subsection to AS 34.20.070 -
foreclosure by trustee.
Proposed AS 34.20.070(e) establishes when a person who
holds a lien or nonpossessory property interest that
can be inferred from an inspection of the property is
entitled to receive a notice of default for a
foreclosure sale.
Proposed AS 34.20.070(f) allows a trustee additional
time after recording to deliver the notice of default
when the trustee delivers the notice personally to the
property or to an occupant of the property. Allows the
trustee to place the notice on the property or as
close as practicable to the property under certain
conditions.
Proposed AS 34.20.070(g) states that an affidavit
signed by a trustee or another person who delivered
notice personally under sec. 34.20.070(f) is prima
facie evidence that the trustee complied with proposed
AS 34.20.070(f). Establishes a conclusive presumption.
Proposed AS 34.20.070(h) establishes how a trustee may
satisfy the notice requirements for a person known by
the trustee to be deceased.
4:02:52 PM
MS. PIERSON continued to review the sectional analysis of HB
108, as follows:
Proposed AS 34.20.070(i) establishes how a trustee may
satisfy the notice requirements for a person known by
the trustee to be deceased and for whom the trustee or
the deed of trust beneficiary knows that a personal
representative has been appointed for the deceased
person.
Proposed AS 34.20.070(j) states that an heir or
devisee of a deceased person must challenge a
foreclosure sale within 90 days if alleging non-
receipt of notice and if the trustee gave notice as
required by (h) - (i).
Proposed AS 34.20.070(k) describes the persons who may
bring a court action to enjoin a foreclosure sale.
Proposed AS 34.20.070(l) states that when a court
injunction action meets certain conditions, a court
may impose conditions that it considers appropriate to
protect the deed of trust beneficiary.
Proposed AS 34.20.070(m) defines certain terms for AS
34.20.070.
4:03:51 PM
MS. PIERSON continued to review the sectional analysis, as
follows:
Section 7. AS 34.20.080(a) is amended to require that
the proceeds from a foreclosure sale are placed in
escrow until disbursed. This section allows a trustee
to accept foreclosure bids by telephone, the Internet,
and electronic mail if certain conditions are met.
Section 8. Amends AS 34.20.080(b) Allowing the
attorney or other agent of the trustee to conduct the
sale. Additionally, allows the trustee to set
reasonable rules for the conduct of the sale. Adds
language that conforms the deed delivery requirements
to the new provision in proposed AS 34.20.070(g)
allowing the trustee to rescind the sale under certain
circumstances.
Section 9. Amends AS 34.20.080(e) Limiting the
postponement of a foreclosure sale to not more than 12
months unless a new notice of sale is given.
Establishes that postponement for up to 12 months does
not provide a basis for challenging the validity of
the foreclosure sale.
4:04:59 PM
MS. PIERSON continued with the sectional analysis, as follows:
Section 10. Adds a new subsection to AS 34.20.080.
Proposed AS 34.20.080(f) indicates how any cash
proceeds of the sale are to be distributed after
delivery of a deed.
Proposed AS 34.20.080(g) allows a trustee to withhold
delivery of the deed for up to five days, prohibits
the trustee from issuing the deed under certain
conditions, and describes what the trustee must do
when rescinding the sale.
Proposed AS 34.20.080(h) allows the trustee to
reschedule a rescinded sale, establishes a minimum
time that must elapse after the rescinded sale before
the new sale may be held, and establishes the notice
procedure that the trustee must follow for rescinding
the sale.
Proposed AS 34.20.080(i) establishes that if a sale is
not rescinded it completely terminates the rights of
the trustor of the deed in the property.
Section 11. Amends AS 34.20.120(a), allowing the
attorneys for the beneficiaries or their successors in
interest to execute and acknowledge the substitution
of a trustee for certain deeds of trust.
Section 12. Amends AS 34.20.120(b), which adds a
requirement to the contents of a trustee substitution
for a situation when the substitution is executed by
the attorneys for the beneficiaries or their
successors.
4:06:19 PM
MS. Pierson continued with the sectional analysis, as follows:
Section 13. Adds a new section AS 34.20.125(a)
requiring a trustee to provide a surety bond before
performing trustee duties under a deed of trust
foreclosure.
AS 34.20.125(b) requires the bond to be terminable at
any time by the surety by complying with certain
requirements, indicates when the bond terminates, and
indicates that the surety is not liable after
termination for more than the face amount of the bond.
States that a revision of the amount of the bond is
not cumulative.
AS 34.20.125(c), gives notice requirements for a
termination of the bond.
AS 34.20.125(d), requires a trustee to file evidence
of a bond each year with the Department of Commerce,
Community, and Economic Development (DCCED). Requires
the department to verify that the evidence is
satisfactory, keep an updated list of bonded trustees.
AS 34.20.125(e) exempts certain persons from the
bonding requirements.
AS 34.20.125(f) defines "department" in this section
to mean the DCCED.
4:08:15 PM
STEPHEN ROUTH, Attorney, Routh & Crabtree APC, stated that he is
an attorney with the firm Routh & Crabtree, APC and that he has
practiced law for over 30 years. He related during his
practice, he has handled thousands of foreclosures over the
years. He reiterated that this language passed the House last
legislature as House Bill 163 with unanimous support. He stated
that HB 108 is supported by credit unions, title insurance
companies, and banks. He recalled that he has discussed last
year's bill with groups including Alaska Public Interest
Research Group (AkPIRG) and legal services. He said, "The bill
is good for borrowers, title agents, finance institutions,
cleans up language, streamlines process." He related that his
office notices the impacts from imprecise language since his
firm handles litigation.
MR. ROUTH opined that litigation solves problems, but not very
efficiently. He offered his belief that HB 108 contains cleanup
language. He recalled Representative Ramras's staff referred to
language in current law which states "three months", but that
"90 days" is more precise. He mentioned problems exist with
requirements to post notices in U.S. Post offices since the USPO
will no longer allow postings of state notices. He summarized
by relating that the language in the bill was built on
consensus, with input from title companies, other attorneys,
financial institutions, and borrowers' groups. He related three
other states have mandated Internet requirements since last year
including Florida. He outlined problems with notices in
newspapers since the publications are not precisely listed.
4:11:55 PM
MR. ROUTH detailed the foreclosure process, which he said begins
with a default payment, and the beneficiary or the lender
records the notice of default, which is mailed, posted, and
published and a sale is held. He noted the proposed bill
details the mail and posting requirements. He stressed that
people can show up and bid at a real estate auction if they are
aware of the sale. He emphasized when no one shows up at the
real estate auction, the property reverts to the lender. He
opined that the situation is bad for the bank and for the
neighborhood. He further opined that property values in areas
surrounding the foreclosure drop, which can lead to an
escalation of defaulted loans. He offered his belief that when
someone learns about a pending sale and buys a home and moves
in, the process is good for the neighborhood and the borrower.
He characterized it as a "win-win." He related from his own
experience that his office uses a website to provide free
service. He opined instances in which property is well
presented on a website will attract bidders and on average
property is twice as likely to be sold to a third party.
4:13:58 PM
REPRESENTATIVE HOLMES referred to the Internet requirements set
out in Section 2. She said she agrees with the idea of using
the Internet. However, she said she wants to be sure people can
qualify. She stated the proposed language sets out six criteria
that must be met. She inquired as to how many websites would be
able to comply with those standards.
MR. ROUTH recalled when he checked last year, that three
websites met the criteria, although he thought currently more
might meet the criteria. He added that the requirements were
added in an attempt to track the newspaper publication in
existing law. Thus, it was important to find sources that were
not subscription based but were free to the public.
Additionally, it was important to not bury the notice within a
website like "Amazon.com". He opined that the provision
requiring continuous operation was to provide continuity. He
explained that the viewership was considered a low number of
hits. Thus 5,000 appeared to be a low number. The final
requirement that a website must be a business with an office in
Alaska was to add a local presence. He stated the requirement
was added to prevent situations such as the only contact number
for the business is an 800 number, or to contact someone in a
foreign country like Bangladesh.
4:16:23 PM
REPRESENTATIVE HOLMES agreed the criteria made a lot of sense.
She referred to paragraph (3), to be used primarily to advertise
real property under foreclosure. She inquired as to whether
newspaper sites such as "Adn.com" would qualify since the
website has a section of the classifieds that list foreclosures.
MR. ROUTH answered that yes, the website would qualify. He
stated that the Anchorage Daily News meets the requirement for
5,000 "hits". He added that when he last checked the
publication had 76,000 monthly users.
REPRESENTATIVE HOLMES stated she just wanted to ensure that
online newspapers were not precluded from advertising the
foreclosure notices.
4:17:44 PM
REPRESENTATIVE HOLMES referred to Section 4 of HB 108, which is
the requirement the homeowner must show up at least two days
prior to the sale to "cure a default". She recalled the time
had been shortened from five to two days. She related her
understanding that the primary reason for HB 108 is to protect
the borrower. She expressed concern that if a borrower appeared
at the bank the day before the foreclosure sale, the bank would
not accept the payment and would continue with the foreclosure
sale. Representative Holmes reiterated her concern over the
two-day requirement in Section 4 of HB 108.
4:19:03 PM
MR. ROUTH agreed that the intent is to not have property in
foreclosure. However, he stated what happens in general
practice is that people will push the deadline. He emphasized
his belief that banks will not ever refuse "any borrower handing
them money." He said that turning away money is not in the
bank's best interest. He related that the "two day provision"
helps to avoid confusion. He related a scenario in which the
borrower rushes up at the wrong time, but the foreclosure has
already happened. He related another scenario in which a
borrower rushes up and has a check drawn on a Lower-48 bank. He
mentioned a third scenario in which a borrower provides nickels
and dimes and the bank needs a counting machine to count it.
He said, "This just gives a little breathing room at the end so
that it doesn't put the borrower in the position of missing the
sale or being late, or put the trustee in the position of not
knowing what to do because there's been an inappropriate tender
of funds." He opined if those circumstances occurred, his
office's response would try to postpone the sale to obtain the
funds. He said, "I'm not in love with the 2 days. We proposed
5 days, initially. I'm okay with 2 days. I'm okay with one
day. I'm okay with no days. It's trying to avoid the confusion
which happens at the last minute, as much to protect the
borrower as anybody else."
REPRESENTATIVE HOLMES stated that Mr. Routh's testimony was
helpful.
4:21:26 PM
The committee took an at-ease from 4:21 p.m. to 4:22 p.m.
4:22:15 PM
CHAIR OLSON passed the gavel over to Representative Lynn.
4:22:40 PM
ROBERT SCHMIDT, Attorney, stated that he is an attorney with the
firm of Groh Eggers LLC, but that he is appearing on behalf of
himself. He opined that this bill is in substance very good.
He related that HB 108 codifies the common law, and adds clarity
to the foreclosure process and he encourages passage of HB 108
He offered that he has only one substantive issue with HB 108,
which has already been brought up, which is the Internet
publication issue. He expressed concern that passage of HB 108,
as written, might only allow one website that complies with the
provisions, which would be usa-foreclosure.com which is owned by
Mr. Routh. He offered that the concept of additional publicity
resulting in more borrowers, at a higher bid price, could
provide the defaulted borrower with a higher sales price and
protection against "clouding values in the neighborhood" is
good. However, he reiterated his concern that as written other
parties would not be able to compete.
MR. SCHMIDT opined that "Craig'slist" would not qualify because
senior management offices are not in Alaska. He offered his
belief that groheggers.com would not qualify for two reasons.
First, the website does not receive 10,000 unique visits per
month although his firm has advertised foreclosures for many
years. Second, the purpose of his firm's website is not to
advertise real property by foreclosure. He recalled earlier
testimony by Mr. Routh, that a company whose website contained a
section dedicated to foreclosures would be sufficient to meet
the criteria for posting foreclosure notices. He pointed out
the nearly universal practice of attorneys that conduct
foreclosures in the state to publish their notices of default
with the Alaska Journal of Commerce since it is the least
expensive publication. He said, " When you publish your notice
of default, you automatically have your notice of default
published on their website." He encouraged the committee to
take one of two steps. He referred to last year's House Bill
163. He related that the bill sections relating to Internet
publication were removed. Alternately, he suggested that the
committee could amend proposed AS 09.35.140 (c) and eliminate
paragraphs (3),(5), and (6) so an Internet site would be
available to any person and would be completely free for public
viewing, and would have been in operation for more than a year.
4:26:20 PM
MR. SCHMIDT related his understanding that it would be
informative to state which website would not qualify. He opined
that besides his firm's website, bank websites or the state's
website would not qualify since the primary reason is not to
advertise real property under foreclosures. He reminded members
that under the Alaska Housing Finance Corporation (AHFC) the
state is a significant player in the mortgage market. He said
he believes that HB 108 is an excellent bill, which will
substantially improve the foreclosure process. He maintained
his concern as well as those of some of his colleagues with the
Internet publication requirements.
4:28:08 PM
REPRESENTATIVE LYNN closed public testimony for today on HB 108.
He announced that public testimony could be reopened by Chair
Olson at the next hearing of HB 108.
4:28:32 PM
ADJOURNMENT
There being no further business before the committee, the House
Labor and Commerce Standing Committee meeting was adjourned at
4:28 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| 01 HB29 ver A.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 29 |
| 01 HB108 ver A.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 108 |
| 02 HB29 Sponsor Statement.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 29 |
| 03 HB29 Sectional Analysis.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 29 |
| 04 HB029-DOLWD-WH-02-11-09.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 29 |
| 05 HB29 ADN Article.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 29 |
| 06 HB29 Poverty Guideline.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 29 |
| 07 HB29 NCSL Minimum Wage List.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 29 |
| 02 HB108 Sponsor Statement.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 108 |
| 03 HB108 Sectional Analysis.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 108 |
| 04 HB108 Support Letter First American Title Insurance Co.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 108 |
| 05 HB108-DOR-AHFC-02-20-09.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 108 |
| 08 HB29 Legislative Research Shop.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 29 |
| 09 HB29 Card and Kreuger Study.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 29 |
| 10 HB29 Wellington Study.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 29 |
| Feb 23 Packet Information.pdf |
HL&C 2/23/2009 3:15:00 PM |
HB 29 HB 108 |