Legislature(2017 - 2018)BARNES 124
03/08/2017 03:15 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| HB108 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 79 | TELECONFERENCED | |
| *+ | HB 108 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE LABOR AND COMMERCE STANDING COMMITTEE
March 8, 2017
3:18 p.m.
MEMBERS PRESENT
Representative Sam Kito, Chair
Representative Adam Wool, Vice Chair
Representative Andy Josephson
Representative Louise Stutes
Representative Chris Birch
Representative Gary Knopp
Representative Colleen Sullivan-Leonard
MEMBERS ABSENT
Representative Mike Chenault (alternate)
Representative Bryce Edgmon (alternate)
COMMITTEE CALENDAR
HOUSE BILL NO. 108
"An Act adopting and relating to the Revised Uniform Fiduciary
Access to Digital Assets Act."
- HEARD & HELD
HOUSE BILL NO. 79
"An Act relating to workers' compensation; repealing the second
injury fund upon satisfaction of claims; relating to service
fees and civil penalties for the workers' safety programs and
the workers' compensation program; relating to the liability of
specified officers and members of specified business entities
for payment of workers' compensation benefits and civil
penalties; relating to civil penalties for underinsuring or
failing to insure or provide security for workers' compensation
liability; relating to preauthorization and timely payment for
medical treatment and services provided to injured employees;
relating to incorporation of reference materials in workers'
compensation regulations; relating to proceedings before the
Workers' Compensation Board; providing for methods of payment
for workers' compensation benefits; relating to the workers'
compensation benefits guaranty fund authority to claim a lien;
excluding independent contractors from workers' compensation
coverage; establishing the circumstances under which certain
nonemployee executive corporate officers and members of limited
liability companies may obtain workers' compensation coverage;
relating to the duties of injured employees to report income or
work; relating to misclassification of employees and deceptive
leasing; defining 'employee'; relating to the Workers'
Compensation Board's approval of attorney fees in a settlement
agreement; and providing for an effective date."
- SCHEDULED BUT NOT HEARD
PREVIOUS COMMITTEE ACTION
BILL: HB 108
SHORT TITLE: FIDUCIARY ACCESS TO DIGITAL ASSETS
SPONSOR(s): REPRESENTATIVE(s) CLAMAN
02/08/17 (H) READ THE FIRST TIME - REFERRALS
02/08/17 (H) L&C, JUD
03/08/17 (H) L&C AT 3:15 PM BARNES 124
WITNESS REGISTER
REPRESENTATIVE MATT CLAMAN
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: During the hearing of HB 108, presented the
legislation as prime sponsor.
DEBORAH E. BEHR, Commissioner
National Conference of Commissioners on Uniform State Laws
(NCCUSL)
Juneau, Alaska
POSITION STATEMENT: During the hearing of HB 108, explained the
legislation.
KEN HELANDER, Advocacy Director
American Association of Retired Persons (AARP)
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 108, offered
support for the legislation.
ACTION NARRATIVE
3:18:11 PM
CHAIR SAM KITO called the House Labor and Commerce Standing
Committee meeting to order at 3:18 p.m. Representatives Kito,
Josephson, Birch, Knopp, and Stutes were present at the call to
order. Representatives Wool and Sullivan-Leonard arrived as the
meeting was in progress.
HB 108-FIDUCIARY ACCESS TO DIGITAL ASSETS
3:18:29 PM
CHAIR KITO announced that the only order of business would be
HOUSE BILL NO. 108, "An Act adopting and relating to the Revised
Uniform Fiduciary Access to Digital Assets Act."
3:19:12 PM
REPRESENTATIVE MATT CLAMAN, Alaska State Legislature, advised
that in 2015, 74,000 Alaskans, approximately 9.9 percent of
Alaska's population, were over the age of 65. Due to the
increasingly computer savvy senior population, fiduciary access
to digital assets is more important than ever. He explained
that this legislation provides fiduciaries the legal authority
to manage assets, such as computer files, digital photographs,
and electronic communications. He noted that HB 108 is based
upon the Uniform Law Commission's recommendations to states in
terms of how to address the issue of access to digital assets.
3:20:42 PM
DEBORAH E. BEHR, Commissioner, National Conference of
Commissioners on Uniform State Laws (NCCUSL), advised she is a
Uniform Law Delegation Member from the State of Alaska. Alaska
has been a member of the Uniform Law Commission since
approximately 1914, and advised she considers it to be a state
right's organization because all states meet annually in a
public meeting setting to come up with solutions for interstate
pressing problems that work for all states. The Uniform Law
Commission supports HB 108, and she pointed out there are
letters of support from various entities. The Act itself was
the result of senior advocate groups coming to the Uniform Law
Commission due to difficulties with fiduciaries, wills, powers
of attorney, trusts, guardianship, and conservatorship. She
explained that when a person dies, the executor for the estate
is the fiduciary who gathers all assets and disperses them
according to the wishes expressed in the deceased person's will.
Currently, the nation-wide problem is, "what do you do with
digital assets" because digital assets are encrypted,
downloaded, password protected, and this bill addresses that
issue. Google, Facebook, or whatever provider, are the
custodians with a private service agreement with the user for
their service and, generally, a term of the agreement is that
the provider will keep it confidential. Her husband, she
related, has a third-party contract with "a server person" to
store their pictures, and the picture will be kept confidential.
In the event her husband passes, and she attempts to obtain his
pictures from Google, she will be told the agreement was not
with her, she could not have the pictures, and she will need to
obtain a court order, she said. This bill is not unique, she
described, it is the law in 23 states, and is presently pending
before 17 states.
3:25:56 PM
COMMISSION BEHR explained that a concept of the bill is an opt-
in system. For example, if her husband chose to do nothing,
this bill would not change his relationship with the assets and
she would still have to go to court to receive the assets. The
compromise the Uniform Law Commission worked out with the
industry, the senior groups and the public generally, was that
the online providers, such as Google and Facebook, would adopt
an "online tool." Wherein, she explained, when opening a new
account with Google, for example, it will have a page "And if I
pass away or I get incapacitated this is what I want done with
these assets." Importantly, she offered, "you may say no, and
if you say no, that means no one gets it," no one would receive
the family photos, email communications, and such, and noted
that each service provider has its own model of the form, she
said.
3:27:26 PM
COMMISSIONER BEHR pointed out that commerce is moving to paper-
less, and the difficulties arise when no one has access to the
deceased person's passwords and business documents. This bill
sets up three priorities, as follows: the online tool; your
legally enforceable directions in your will, power of attorney,
or trust; and, when a person does not have an online tool for
whatever reason and the will simply read, "All my assets to my
wife," except that direction is not enough under federal digital
law to release the digital assets. In the event the deceased
had not provided any direction, the "Terms of Service Agreement"
between the deceased and the provider control, meaning she
probably will not easily receive the family photograph album and
will have to go to court. She pointed out that there are
special rules in HB 108 requiring a person to give "express
consent or court order" for email content. In the event the
deceased did not provide express consent, and no court order,
the best the fiduciary receives in this bill is called the
"Catalog of Electronic Communications." She explained that the
catalog contains the "To, From, Date" lines, but not the subject
line or the contents of the email. Fiduciaries have found that
limited amount of information useful because it may offer a road
to follow, she said.
3:32:40 PM
COMMISSIONER BEHR advised that this bill would resolve a problem
for mentally handicapped or disabled individuals who become
incapacitated, cannot monitor their financial account, and the
guardian wishes to close that account. This legislation
provides a court hearing process for the individual to tell the
judge whether they are, or are not, capable of handling their
account. She explained that as the fiduciary of her husband's
estate, and moving through the process of providing
documentation and such for Google, Google will receive immunity
if it disperses the digital assets according to the bill, in
good faith compliance, within 60 days. Commissioner Behr then
related two "war stories."
3:35:07 PM
REPRESENTATIVE BIRCH asked whether sharing information with a
person's spouse, such as user name, password, and name on
account, in detail, is sufficient for legal access.
COMMISSIONER BEHR answered yes, and she said this bill is
necessary due to a federal law in the area of hacking and
wiretapping. This bill allows her access to all of the
documents, to change passwords, but in general, the bill is
necessary because even though the spouse may have the passwords,
the company is under no obligation to deal with the spouse, she
explained.
REPRESENTATIVE BIRCH related that the bill appears to be
reasonable and make sense, and he was curious about the legality
of having access to the deceased's information and accounts.
CHAIR KITO commented that another aspect is that the spouse may
have access but not the authority, and this bill provides the
authority.
3:37:26 PM
REPRESENTATIVE KNOPP offered a scenario of an executor
overseeing his will in the event he and his wife are deceased at
the same time, and asked whether the court determines whether
the person is actually the fiduciary at that point.
COMMISSIONER BEHR responded that her husband appointed her
executor and in order for anyone to legally deal with her as the
executor, she has to go to court and receive a Letter of
Appointment. The online tool information is completed before
the person is deceased. For example, if her husband did not
sign the online tool before passing, she could not go in and
make changes. She opined that the American Association of
Retired Persons (AARP) intends to offer educational programs in
this area, and she said she imagines the Alaska Bar Association
will provide CLE education. She expressed that this is an area
where people must be "more savvy" when moving into the digital
age, and she suggested keeping a digit roadmap of assets,
keeping important things on a flash drive, signing the online
tool, and preparing estate planning.
3:40:58 PM
REPRESENTATIVE KNOPP asked whether this opens the door for "a
lot of corruption, fraud, embezzlement."
COMMISSIONER BEHR replied that new security devices are being
developed to resist hacking, but it is probably not impossible
to hack the information. The key is that the online tool has a
trigger, and her husband's death certificate and other documents
must first be provided.
3:42:29 PM
REPRESENTATIVE WOOL offered a scenario of someone leaving all of
their assets to their spouse and permitting access to the
deceased person's email and Facebook account, and surmised that
Commissioner Behr was saying, for example, Google will not break
the contract. Except, in other circumstances the contract would
be broken through a will, such that if someone wills a spouse a
house or piece of property and unbeknownst to the spouse, the
deceased had a vacation house somewhere. In that scenario, he
said, even though the spouse had no part in the contract for the
vacation house, the spouse still takes ownership of the
property. He asked whether this is different.
COMMISSIONER BEHR noted that this is different, and because
society is in the electronic age it will take time for the law
to develop and resolve issues. The phrase "all my property real
and tangible" includes houses, pieces of property, various
investments, and it is the job of the fiduciary to find those
assets and pull them together. She pointed to the frustrations
of trust companies that have a duty to locate assets, and one of
those assets might be important business records in order to
locate stocks, for example, yet the trust company cannot get
access and does not even know the stocks exist. She described
that this bill is not an overlay statute, it does not go in and
change how a person bequests property or stocks and bonds, that
is all under other law.
3:44:48 PM
REPRESENTATIVE STUTES commented that her mother is 93, and she
requested and received a laptop computer. Her mother is
private, she described, and no one knows her passwords, so this
bill would be instrumental if her mother passed immediately.
3:45:38 PM
CHAIR KITO recalled a previous comment that the post office gets
less business due to the popularity of email, and opined that
the post office stays in business via the internet due to
commerce. He requested clarification as to the difference
between a fiduciary and beneficiary with regard to this
legislation.
COMMISSIONER BEHR answered that a fiduciary, an executor in a
will, for example, has a business and family duty to find and
protect all assets, invest the assets, and fulfill the intent of
the deceased. A beneficiary is the person who actually receives
those assets, such as leaving assets to the grandchildren,
whereby the grandchildren are the beneficiaries and receive
whatever the deceased intended.
3:47:06 PM
CHAIR KITO commented that this legislation is timely in his case
because, as a single parent and transitioning into the
electronic age, he is considering what would happen if he
passed, and how would his daughter have the ability to gain
access to those financial resources, especially if his access
had all been online. His question is whether he should write
down all of the passwords and make sure his executor has the
ability to get the passwords, while understanding the executor
does not have the legal authority. Possibly, he opined, there
is a window in time where there is "almost like a little no one
is looking grace period" to go in and take care of the assets.
He surmised that a person would have to obtain the electronic
opt-in in advance of identifying the fiduciary's responsibility
in a will. He then referred to Commissioner Behr's testimony
that many companies have been around for 10 years, and asked
that once this bill passes in Alaska whether these companies
will be required to allow that opt-in for Alaskans, or whether
many companies currently allow for the electronic opt-in.
COMMISSIONER BEHR responded that the big providers in this area,
Facebook and Google, currently have tools online wherein a
person can designate, and it is expected that other corporations
will come online as this is motivation for them as good
corporate citizens. She pointed to a provision in the bill, "if
it's not there for you to use then they -- we will look to the
will."
3:49:35 PM
CHAIR KITO opened public testimony on HB 108
3:49:52 PM
KEN HELANDER, Advocacy Director, American Association of Retired
Persons (AARP), offered support for the legislation on behalf of
the American Association of Retired Persons (AARP) with 85,000
members in Alaska. Enacting this law is timely and a
consequence of society's digital age, similar to advanced
planning with powers of attorney for finances and health care
decisions. This legislation allows that citizens approaching
their later years in life, or the possibility of sudden
incapacity, to have a sense of self-determination rather than
leaving it to chance or letting the burden fall on other family
members who may have to step in on the deceased's behalf. He
noted that the AARP Public Policy Institute and AARP's national
office in Washington D.C., produced a publication and survey of
adults in the United States, the survey included how adults use
the internet, what they know about a digital legacy, and how
many adults have addressed this issue with members of their
family, or thought about it for themselves. Surprisingly, he
related, a majority of people said they were not interested in
it, but at the same time they all valued that the [assets] be
protected. Education must be provided because it is new and will
take time for adults and service providers to come of age with
this technology, how it is being used, and how we want it to
benefit us in the future, he offered.
[HB 108 was held over.]
3:53:08 PM
ADJOURNMENT
There being no further business before the committee, the House
Labor and Commerce Standing Committee meeting was adjourned at
3:53 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB108 Sponsor Statement 2.27.2017.pdf |
HL&C 3/8/2017 3:15:00 PM |
HB 108 |
| HB108 Sectional Analysis 2.27.17.pdf |
HL&C 3/8/2017 3:15:00 PM |
HB 108 |
| HB108 Fiscal Note-LAW-CIV 3.3.17.pdf |
HL&C 3/8/2017 3:15:00 PM |
HB 108 |
| HB108 Supporting Documents-ULC Fact Sheets 2.27.17.pdf |
HL&C 3/8/2017 3:15:00 PM |
HB 108 |
| HB108 Supporting Documents-ULC Summary 2.27.17.pdf |
HL&C 3/8/2017 3:15:00 PM |
HB 108 |
| HB108 Supporting Documents-ULC Why Adopt 2.27.17.pdf |
HL&C 3/8/2017 3:15:00 PM |
HB 108 |