Legislature(1995 - 1996)

03/14/1996 08:08 AM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
             HOUSE STATE AFFAIRS STANDING COMMITTEE                            
                         March 14, 1996                                        
                           8:08 a.m.                                           
                                                                               
                                                                               
 MEMBERS PRESENT                                                               
                                                                               
 Representative Jeannette James, Chair                                         
 Representative Scott Ogan, Vice Chair                                         
 Representative Joe Green                                                      
 Representative Ivan Ivan                                                      
 Representative Brian Porter                                                   
 Representative Caren Robinson                                                 
 Representative Ed Willis                                                      
                                                                               
 MEMBERS ABSENT                                                                
                                                                               
 All members present.                                                          
                                                                               
 COMMITTEE CALENDAR                                                            
                                                                               
 HOUSE BILL NO. 110                                                            
 "An Act relating to the confidentiality of certain information in             
 motor vehicle records; and providing for an effective date."                  
                                                                               
      - PASSED CSHB 110(STA) OUT OF COMMITTEE                                  
                                                                               
 * HOUSE BILL NO. 415                                                          
 "An Act streamlining the functions of state government, including             
 authorizing the commissioner of fish and game to award grants for             
 certain resource activities; allowing agents selling fish and game            
 licenses and tags to retain certain compensation; authorizing the             
 Department of Health and Social Services to award grants for                  
 certain services for developmentally delayed or disabled children;            
 relating to rabies control and administration of flour and bread              
 standards by the Department of Environmental Conservation;                    
 repealing the Athletic Commission, the regulation of boxing and               
 wrestling, the certification of professional geologists, and the              
 Water Resources Board; repealing certain filing statements and                
 bonds for enforcement and collection of certain taxes; and                    
 providing for an effective date."                                             
                                                                               
      - PASSED CSHB 415(STA) OUT OF COMMITTEE                                  
                                                                               
 HOUSE BILL NO. 443                                                            
 "An Act relating to the tax on transfers or consumption of motor              
 fuel, and repealing the exemption from that tax for motor fuel                
 which is at least 10 percent alcohol by volume; and providing for             
 an effective date."                                                           
                                                                               
      - PASSED CSHB 443(STA) OUT OF COMMITTEE                                  
 (*First public hearing)                                                       
                                                                               
 PREVIOUS ACTION                                                               
                                                                               
 BILL:  HB 110                                                               
 SHORT TITLE: CONFIDENTIALITY OF MOTOR VEHICLE RECORDS                         
 SPONSOR(S): REPRESENTATIVE(S) BARNES, Green                                   
                                                                               
 JRN-DATE      JRN-PG            ACTION                                        
 01/23/95       116    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 01/23/95       116    (H)   STATE AFFAIRS, FINANCE                            
 01/25/95       136    (H)   COSPONSOR(S): GREEN                               
 03/10/95       701    (H)   SPONSOR SUBSTITUTE INTRODUCED-REFERRALS           
 03/10/95       701    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 03/10/95       701    (H)   STATE AFFAIRS, FINANCE                            
 03/07/96              (H)   STA AT  8:00 AM CAPITOL 102                       
 03/12/96              (H)   STA AT  8:00 AM CAPITOL 102                       
 03/14/96              (H)   STA AT  8:00 AM CAPITOL 102                       
                                                                               
 BILL:  HB 415                                                               
 SHORT TITLE: OMNIBUS STATE AGENCY OPERATIONS & PROGRAM                        
 SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR                                  
                                                                               
 JRN-DATE      JRN-PG            ACTION                                        
 01/12/96      2429    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 01/12/96      2429    (H)   STATE AFFAIRS, HES, RESOURCES, FINANCE            
 01/12/96      2429    (H)   2 FISCAL NOTES (F&G, DCED)                        
 01/12/96      2429    (H)   5 ZERO FNS (REV, DNR, 2-DHSS, DEC)                
 01/12/96      2429    (H)   GOVERNOR'S TRANSMITTAL LETTER                     
 03/14/96              (H)   STA AT  8:00 AM CAPITOL 102                       
                                                                               
 BILL:  HB 443                                                               
 SHORT TITLE: INCREASE MOTOR FUEL TAX                                          
 SPONSOR(S): RULES BY REQUEST OF LONG RANGE FINANCIAL PLAN CMSN                
                                                                               
 JRN-DATE      JRN-PG            ACTION                                        
 01/22/96      2508    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 01/22/96      2508    (H)   STATE AFFAIRS, JUDICIARY, FINANCE                 
 03/12/96              (H)   STA AT  8:00 AM CAPITOL 102                       
                                                                               
 WITNESS REGISTER                                                              
                                                                               
 ELEANOR ROSER, Legislative Administrative Assistant                           
    to Representative Ramona Barnes                                            
 State Capitol, Room 403                                                       
 Juneau, Alaska 99801-1182                                                     
 Telephone:  (907) 465-3438                                                    
  POSITION STATEMENT:   Provided committee substitute for HB 110.              
                                                                               
 JUANITA HENSLEY, Chief                                                        
 Driver Services                                                               
 Division of Motor Vehicles                                                    
 Department of Public Safety                                                   
 P.O. Box 20020                                                                
 Juneau, Alaska 99811-0020                                                     
 Telephone:  (907) 465-4361                                                    
  POSITION STATEMENT:   Provided testimony on HB 110.                          
                                                                               
 EDWARD DAUGHERTY, Vice President                                              
 Alaska Archives, IMS Inc.                                                     
 165 East 56th Avenue, Suite 1                                                 
 Anchorage, Alaska 99578                                                       
 Telephone:  (907) 561-8000                                                    
  POSITION STATEMENT:   Provided testimony on HB 110.                          
                                                                               
 NANCY SLAGLE, Director                                                        
 Budget Review                                                                 
 Office of Management and Budget                                               
 Office of the Governor                                                        
 P.O. Box 110020                                                               
 Juneau, Alaska 99811-0020                                                     
 Telephone:  (907) 465-4699                                                    
  POSITION STATEMENT:   Provided testimony on HB 415.                          
                                                                               
 GERON BRUCE, Legislative Liaison                                              
 Office of the Commissioner                                                    
 Department of Fish and Game                                                   
 P.O. Box 25526                                                                
 Juneau, Alaska 99811-5526                                                     
 Telephone:  (907) 465-6143                                                    
  POSITION STATEMENT:   Provided testimony on HB 415.                          
                                                                               
 BOB BARTHOLOMEW, Deputy Director                                              
 Central Office                                                                
 Income and Excise Audit Division                                              
 Department of Revenue                                                         
 P.O. Box 110420                                                               
 Juneau, Alaska 99811-0420                                                     
 Telephone:  (907) 2320                                                        
  POSITION STATEMENT:   Provided testimony on HB 415.                          
                                                                               
 JANICE ADAIR, Director                                                        
 Division of Environmental Health                                              
 Department of Environmental Conservation                                      
 555 Cordova Street                                                            
 Anchorage, Alaska 99501                                                       
 Telephone:  (907) 269-7644                                                    
  POSITION STATEMENT:   Provided testimony on HB 415.                          
                                                                               
 JEFFREY W. BUSH, Deputy Commissioner                                          
 Office of the Commissioner                                                    
 Department of Commerce and Economic Development                               
 P.O. Box 110800                                                               
 Juneau, Alaska 99811-0800                                                     
 Telephone:  (907) 465-2500                                                    
  POSITION STATEMENT:   Provided testimony on HB 415.                          
                                                                               
 NICO BUS, Acting Director                                                     
 Central Office                                                                
 Division of Support Services                                                  
 Department of Natural Resources                                               
 400 Willoughby Avenue                                                         
 Juneau, Alaska 99801-1724                                                     
 Telephone:  (907) 465-2406                                                    
  POSITION STATEMENT:   Provided testimony on HB 415.                          
                                                                               
 JOE THOMAS, State Accountant                                                  
 Division of Finance                                                           
 Department of Administration                                                  
 P.O. Box 110204                                                               
 Juneau, Alaska 99811-0204                                                     
 Telephone:  (907) 465-5616                                                    
  POSITION STATEMENT:   Provided testimony on HB 415.                          
                                                                               
 MIKE MCMULLEN, Merit System Personnel Manager                                 
 Central Office                                                                
 Division of Personnel                                                         
 Department of Administration                                                  
 P.O. Box 110201                                                               
 Juneau, Alaska 99811-0201                                                     
 Telephone:  (907) 465-4431                                                    
  POSITION STATEMENT:   Provided testimony on HB 415.                          
                                                                               
 MARIANNE K. BURKE, Director                                                   
 Central Office                                                                
 Division of Insurance                                                         
 Department of Commerce and Economic Development                               
 P.O. Box 110805                                                               
 Juneau, Alaska 99811-0805                                                     
 Telephone:  (907) 465-2515                                                    
  POSITION STATEMENT:   Provided testimony on HB 415.                          
                                                                               
 JOHN GEORGE, Lobbyist                                                         
 American Council of Life Insurance                                            
 National Association of Independent Insurers                                  
 3328 Fritz Cove Drive                                                         
 Juneau, Alaska 99801                                                          
 Telephone:  (907) 789-0172                                                    
  POSITION STATEMENT:   Provided testimony on HB 415.                          
                                                                               
 SAM KITO III, Legislative Liaison/Special Assistant                           
 Office of the Commissioner                                                    
 Department of Transportation and Public Facilities                            
 3132 Channel Drive                                                            
 Juneau, Alaska 99801-7898                                                     
 Telephone:  (907) 465-3904                                                    
  POSITION STATEMENT:   Provided testimony on HB 443.                          
                                                                               
                                                                               
 ACTION NARRATIVE                                                              
                                                                               
 TAPE 96-35, SIDE A                                                            
 Number 0000                                                                   
                                                                               
 The House State Affairs Committee was called to order by Chair                
 Jeannette James at 8:08 a.m.  Members present at the call to order            
 were Representatives Ogan, Green, Porter, Willis and James.                   
 Members absent were Representatives Ivan and Robinson.                        
 HB 110 - CONFIDENTIALITY OF MOTOR VEHICLE RECORDS                           
                                                                               
 The first order of business to come before the House State Affairs            
 Committee was HB 110.                                                         
                                                                               
 CHAIR JEANNETTE JAMES called on Eleanor Roser, Legislative                    
 Administrative Assistant to Representative Ramona Barnes, to                  
 present the committee substitute (9-LS0490/G).                                
                                                                               
 Number 0080                                                                   
                                                                               
 ELEANOR ROSER, Legislative Administrative Assistant to                        
 Representative Ramona Barnes, explained the provisions of the                 
 federal law were included at the request of the House State Affairs           
 Committee in the committee substitute.  The provisions described              
 the circumstances for disclosure by the Division of Motor Vehicle             
 (DMV).                                                                        
                                                                               
 CHAIR JAMES called on Juanita Hensley, Department of Public Safety.           
                                                                               
 The record reflected the arrival of Representative Caren Robinson             
 at 8:09 a.m.                                                                  
                                                                               
 Number 0121                                                                   
                                                                               
 JUANITA HENSLEY, Chief, Driver Services, Division of Motor                    
 Vehicles, Department of Public Safety, stated the committee                   
 substitute met the requirements of the federal act.  It also met              
 the requirements of the model law drafted by the American                     
 Association of Motor Vehicle Administrators.  It was not over                 
 extensive and was in compliance with the Privacy Act.                         
                                                                               
 Number 0195                                                                   
                                                                               
 CHAIR JAMES thanked Ms. Hensley for her work on the committee                 
 substitute.                                                                   
                                                                               
 Number 242                                                                    
                                                                               
 MS. HENSLEY stated the committee substitute did not include drivers           
 license information that was required in the federal act.  The                
 drivers license information was already prohibited in statute.                
                                                                               
 Number 0278                                                                   
                                                                               
 REPRESENTATIVE CAREN ROBINSON asked if the committee substitute               
 clarified what was required to meet the federal standards?                    
                                                                               
 Number 0288                                                                   
                                                                               
 MS. HENSLEY replied, "yes it does."                                           
                                                                               
 Number 0302                                                                   
                                                                               
 REPRESENTATIVE GREEN moved to adopt CSHB 110(STA) (9-LS0490/G) as             
 a working document.  Hearing no objection, it was so adopted.                 
                                                                               
 Number 0376                                                                   
                                                                               
 REPRESENTATIVE ROBINSON moved that CSHB 110(STA) move from the                
 committee with individual recommendation and attached fiscal notes.           
                                                                               
 CHAIR JAMES explained there were witnesses to testify.                        
                                                                               
 REPRESENTATIVE ROBINSON held her motion.                                      
                                                                               
 CHAIR JAMES called on the first witness via teleconference in                 
 Anchorage, Edward Daugherty.                                                  
                                                                               
 Number 0437                                                                   
                                                                               
 EDWARD DAUGHERTY, Alaska Archives, explained his company provided             
 DMV information on microfiche and CDROM.  The information was                 
 generally sold to banks, collection agencies, and private                     
 investigators, for example.  He was concerned about the individuals           
 with a legitimate need for the information.  The bill did not                 
 provide the infrastructure to acquire that information from the               
 DMV.                                                                          
                                                                               
 Number 0521                                                                   
                                                                               
 CHAIR JAMES commented DMV could provide that information through a            
 conduit agreement.                                                            
                                                                               
 Number 0554                                                                   
                                                                               
 MR. DAUGHERTY replied his company was comfortable with that.  He              
 was not as comfortable, however, because a provision was not                  
 included in the bill to ensure that.  He complemented Ms. Hensley             
 for her cooperation.  However, other offices within the DMV were              
 not always as cooperative by restricting information.  He                     
 reiterated he wanted further assurance that he would be able to               
 access the information.                                                       
                                                                               
 The record reflected the arrival of Representative Ivan Ivan and              
 8:13 a.m.                                                                     
                                                                               
 Number 0644                                                                   
                                                                               
 REPRESENTATIVE PORTER asked, if the business of Mr. Daugherty would           
 be perceived as giving information to the public, or to someone who           
 had a legitimate need?                                                        
                                                                               
 Number 0662                                                                   
                                                                               
 MS. HENSLEY wondered if Mr. Daugherty was looking at the committee            
 substitute.  The committee substitute allowed the DMV to release              
 information to him, however, there were restrictions on how he                
 could release the information to the public.                                  
                                                                               
 Number 0688                                                                   
                                                                               
 CHAIR JAMES asked Mr. Daugherty if he had committee substitute                
 version 9-LS0490/G?                                                           
                                                                               
 MR. DAUGHERTY replied, "no."                                                  
                                                                               
 Number 0698                                                                   
                                                                               
 CHAIR JAMES announced her staff would fax one to him immediately in           
 Anchorage.  Furthermore, although she was supportive of a                     
 sufficient statute so that regulations were not needed, the                   
 Division of Motor Vehicles needed to subsume some of the                      
 responsibilities.  She did not want to include a conduit                      
 relationship in the bill.                                                     
                                                                               
 Number 0748                                                                   
                                                                               
 MR. DAUGHERTY replied he welcomed the bill.  It was needed, as-               
 long-as there was a provision that allowed equal access for those             
 that had a compelling need, he supported the bill and was happy               
 with it.                                                                      
                                                                               
 Number 0789                                                                   
                                                                               
 CHAIR JAMES felt some of her rights were being taken away.  She               
 wanted to be able to identify someone on the road.  She reiterated            
 it was an intrusion of our freedoms.                                          
                                                                               
 Number 0855                                                                   
                                                                               
 REPRESENTATIVE ROBINSON reiterated her motion.  Hearing no                    
 objection, it was so moved from the House State Affairs Committee.            
 HB 415 - OMNIBUS STATE AGENCY OPERATIONS & PROGRAM                          
                                                                               
 The next order of business to come before the House State Affairs             
 Committee was HB 415.                                                         
                                                                               
 CHAIR JAMES called on Nancy Slagle, Office of the Governor, to                
 introduce the bill.                                                           
                                                                               
 Number 0934                                                                   
                                                                               
 NANCY SLAGLE, Director, Budget Review, Office of Management and               
 Budget, Office of the Governor, thanked the House State Affairs               
 Committee members for the hearing today.  The intent of HB 415 was            
 to identify inefficient areas within state government and to                  
 correct them.  She referred the committee members to a spreadsheet            
 prepared summarizing a sectional analysis of the bill.                        
                                                                               
 MS. SLAGLE explained Section 1 related to the Department of Fish              
 and Game.  It allowed the Department to award grants related to its           
 functions.  Currently, it had to use another state agency that had            
 the authority to award a grant.                                               
                                                                               
 Number 1060                                                                   
                                                                               
 MS. SLAGLE explained Sections 2 - 4 also related to the Department            
 of Fish and Game.  It allowed vendors of sport fishing and hunting            
 licenses and tags to retain the full 5 percent of their                       
 compensation for their services.                                              
                                                                               
 Number 1109                                                                   
                                                                               
 CHAIR JAMES cited the Alaska Visitor Association (AVA) turned over            
 their net proceeds to the Alaska Marketing Council.  An auditor               
 indicated that could be a violation because there was not an                  
 appropriation back to the Association.  She wondered if it was a              
 violation due to retaining the money as a result of a state item              
 being sold.                                                                   
                                                                               
 Number 1173                                                                   
                                                                               
 MS. SLAGLE replied the amount being retained by the vendors was not           
 identified in the appropriations.  She stated any money spent from            
 the state treasury must have an appropriation.  It did not fall               
 under the requirements of the law, but there was a need for the               
 legislature to look at the full cost of a program that might offset           
 the constitutional appropriation requirements.  The Governor's bill           
 would give the appropriation authority for the amounts being                  
 retained by the vendors.                                                      
                                                                               
 Number 1286                                                                   
 CHAIR JAMES was also concerned about the individuals selling the              
 hunting and fishing licenses.  She wondered if the compensation was           
 sufficient to cover their costs.  She was also concerned about the            
 varying prices for the licenses.  She asked the Department of Fish            
 and Game if the 5 percent compensation was sufficient?                        
                                                                               
 CHAIR JAMES called on Geron Bruce, Department of Fish and Game, to            
 answer her concerns.                                                          
                                                                               
 Number 1348                                                                   
                                                                               
 GERON BRUCE, Legislative Liaison, Office of the Commissioner,                 
 Department of Fish and Game, replied no one had done an analysis of           
 her concerns.  He stated, of the 1,400 vendors in Alaska, most                
 appeared satisfied.  The Department had not received any                      
 complaints.  He stated there was a close working relationship                 
 between the Department and the vendors.  The Department often                 
 sought their advise on how to improve the program.  He reiterated             
 the anecdotal evidence indicated they were satisfied with the                 
 program.  Furthermore, the licensing process was difficult to                 
 simplify because of the resident and nonresident structures.                  
 Within the nonresident structure there were a number of short-term            
 licenses.  It was designed to aide the visitor industry.  There was           
 also the tag system.  He said the Department could look at                    
 simplifying the licensing programs, however.  He explained the fee            
 structure was set by the legislature.  Therefore, the Department              
 was trying to implement the program the legislature set forth.                
                                                                               
 Number 1473                                                                   
                                                                               
 CHAIR JAMES responded the cost of the licenses were imputed on the            
 public.  She did not have a solution, but was happy to hear the               
 Department recognized it was complicated.  It would probably need             
 to be corrected in the future, however.                                       
                                                                               
 Number 1520                                                                   
                                                                               
 REPRESENTATIVE ED WILLIS asked Ms. Slagle to explain the proposed             
 amendment that calculated terminal leave payments based on an                 
 annualized rate of pay.                                                       
                                                                               
 CHAIR JAMES replied it would be better to discuss the bill first              
 before discussing the amendments.                                             
                                                                               
 REPRESENTATIVE WILLIS held his question.                                      
                                                                               
 Number 1548                                                                   
                                                                               
 REPRESENTATIVE PORTER stated the concerns of a dedicated fund were            
 complex.  It was more complex than requiring an appropriation for             
 the general fund, for example.  The issue was still out there, he             
 stated, for the record.                                                       
 Number 1594                                                                   
                                                                               
 MS. SLAGLE moving forward explained Section 5 related to the                  
 Department of Commerce and Economic Development.  It also related             
 to Section 10.  It allowed a notice of action or legal proceeding             
 against a nonresident business owners for non-payment of taxes or             
 fees to be sent to the last known address.  Section 10 repealed a             
 statute to eliminate the Nonresident Affidavit Tax Bond program.              
                                                                               
 Number 1644                                                                   
                                                                               
 BOB BARTHOLOMEW, Deputy Director, Central Office, Income and Excise           
 Audit Division, Department of Revenue, explained Section 10                   
 referenced two state statutes - Title 16 and Title 43.  Title 43              
 addressed the tax codes.  He explained in 1955 a tax bond program             
 was enacted so that the a nonresident business would pay its taxes.           
 The Department of Revenue recommended that program be eliminated.             
 He said it had out lived its useful life.  Alaska was the only                
 remaining state that still had a program like this.  Furthermore,             
 the State had never collected against the bond.  Other avenues were           
 used such as liens.  Moreover, it required about 1,000 hours of               
 staff time to process 4,000 affidavits.  He reiterated the                    
 Department recommended the elimination of the program.  He                    
 explained Section 5, pages 3 - 5 deleted the language relating to             
 the Nonresident Affidavit Bond program.                                       
                                                                               
 Number 1761                                                                   
                                                                               
 REPRESENTATIVE PORTER wondered where the fiscal note was that                 
 illustrated the money saved due to the elimination of the program.            
                                                                               
 Number 1767                                                                   
                                                                               
 MR. BARTHOLOMEW replied the Department of Revenue included a $0               
 fiscal note.  The staff time saved would be used to enhance the tax           
 compliance programs.  The compliance programs were reduced due to             
 a $450,000 division budget reduction in the last two years.                   
                                                                               
 Number 1803                                                                   
                                                                               
 CHAIR JAMES wondered if that would produce a bigger positive fiscal           
 note.                                                                         
                                                                               
 MR. BARTHOLOMEW replied, "we feel it will."  It was hard to                   
 estimate, however.                                                            
                                                                               
 REPRESENTATIVE PORTER said, "Bob, we're pulling your chain."                  
                                                                               
 Number 1810                                                                   
                                                                               
 REPRESENTATIVE GREEN asked Mr. Bartholomew if the bond program for            
 residents had also been eliminated?                                           
 Number 1820                                                                   
                                                                               
 MR. BARTHOLOMEW replied there was no requirement for the instate              
 program.  Furthermore, he explained the Anchorage Chamber of                  
 Commerce and the Small Business Development Program at the                    
 University of Alaska both supported the elimination of the Non-               
 resident Affidavit Tax Bond program.                                          
                                                                               
 Number 1834                                                                   
                                                                               
 MS. SLAGLE moving forward explained Sections 6 - 7 related to the             
 Department of Health and Social Services.  It allowed the                     
 Department to grant authority for the Infant Learning program                 
 within the Division of Public Health.  The program provided                   
 services to children with developmental disabilities.                         
                                                                               
 Number 1883                                                                   
                                                                               
 CHAIR JAMES said she understood the need for granting authority.              
 She wondered if it would interfere with individual granting                   
 authority.                                                                    
                                                                               
 MS. SLAGLE replied, "no."                                                     
                                                                               
 Number 1911                                                                   
                                                                               
 MS. SLAGLE moving forward explained Section 8 related to the                  
 Department of Environmental Conservation.  It repealed AS                     
 03.05.070, eliminating the requirements that the department report            
 and care for animals suspected of rabies and the disposal of rabid            
 animals.  It further repealed AS 17.07.010 - AS 17.07.200,                    
 eliminating the requirements that the department regulate the                 
 vitamin and mineral content of flour and bread sold in the state.             
 It was now regulated by the federal government.                               
                                                                               
 Number 1947                                                                   
                                                                               
 REPRESENTATIVE WILLIS wondered what would happen if the rabies                
 provision was repealed.                                                       
                                                                               
 CHAIR JAMES called on Janice Adair, Department of Environmental               
 Conservation, to address his concern via teleconference in                    
 Anchorage.                                                                    
                                                                               
 Number 1960                                                                   
                                                                               
 JANICE ADAIR, Director, Division of Environmental Health,                     
 Department of Environmental Conservation, replied the Department              
 rarely was involved in cases of rabid animals.  Currently, the                
 local government, or in the villages, the public safety officers or           
 the public health officers, handled those cases.  The DEC did not             
 have the expertise or the training to handle these cases.                     
 Furthermore, the employees had not been vaccinated against rabies             
 presenting a life threatening situation.  Furthermore, if a local             
 government did not have a program already, the Department would               
 work with them to help develop one.                                           
                                                                               
 Number 1998                                                                   
                                                                               
 CHAIR JAMES wondered what would happen to the regulations.                    
                                                                               
 Number 2012                                                                   
                                                                               
 MS. ADAIR replied there were not any regulations.                             
                                                                               
 Number 2028                                                                   
                                                                               
 MS. SLAGLE moving forward explained Section 9 related to the                  
 Department of Commerce and Economic Development (DCED).  It                   
 repealed several statutes.  Alaska Statute 05.05.010 eliminated the           
 Athletic Commission, AS 05.10.010 eliminated the Boxing and                   
 Wrestling Commission, AS 08.02.011 eliminated the requirement to              
 certify professional geologists by the DCED, and AS 46.15.190                 
 eliminated the Water Resources Board.                                         
                                                                               
 CHAIR JAMES called on Jeffrey W. Bush, Department of Commerce and             
 Economic Development, to further explain Section 9.                           
                                                                               
 Number 2065                                                                   
                                                                               
 JEFFREY W. BUSH, Deputy Commissioner, Office of the Commissioner,             
 Department of Commerce and Economic Development, announced he was             
 here to answer any questions.                                                 
                                                                               
 Number 2075                                                                   
                                                                               
 REPRESENTATIVE GREEN asked Mr. Bush, if anyone could practice the             
 field of Geology within the state, as a result of the repealed                
 statute?                                                                      
                                                                               
 Number 2082                                                                   
                                                                               
 MR. BUSH replied, "yes."  However, there was no requirement for               
 certification at the present time anyway.  It was not a                       
 certification requirement, but an option that existed in the law.             
 He called it an administrative function whereby an individual                 
 applied for a certificate stating he met the requirements upon                
 which a certificate was handed to him.  The certificates were not             
 used for a purpose other than to hang on the wall.  He cited many             
 individuals applied from other parts of the country because it was            
 well known and liked.                                                         
                                                                               
 Number 2120                                                                   
                                                                               
 REPRESENTATIVE GREEN said, "send in the box top and a quarter."               
                                                                               
 MR. BUSH replied, "that's right."  It was performed by the                    
 director.  He just looked at the paperwork and upon receipt of the            
 payment, a certificate was sent.                                              
                                                                               
 Number 2138                                                                   
                                                                               
 REPRESENTATIVE PORTER asked Mr. Bush if there would be any state              
 oversite if a promoter wanted to put on a boxing match in the                 
 state?                                                                        
                                                                               
 MR. BUSH replied the reason for the elimination was due to a lack             
 of funding for the Boxing and Wrestling Commission.  The options              
 were to either eliminate it or appropriate funds.  The Department             
 saw it as a state liability because the statute required somebody             
 to attend the boxing matches, and, currently, there was not anybody           
 on staff that could do it for free.  Furthermore, the way the                 
 occupational licensing program worked, other programs could not be            
 charged for that type of oversite.                                            
                                                                               
 Number 2204                                                                   
                                                                               
 REPRESENTATIVE WILLIS wondered if there had been any reaction from            
 the sports fans regarding the elimination of the Athletic                     
 Commission and the Boxing and Wrestling Commission.                           
                                                                               
 Number 2211                                                                   
                                                                               
 MR. BUSH replied, "no."  There had not been any response regarding            
 the bill.                                                                     
                                                                               
 Number 2217                                                                   
                                                                               
 REPRESENTATIVE SCOTT OGAN mentioned the brutal sport of kick                  
 boxing.  He wondered, if it were to come to Alaska, would the                 
 Commission regulate that type of sport.                                       
                                                                               
 Number 2254                                                                   
                                                                               
 MR. BUSH replied that was the purpose of the Commission, to                   
 regulate the type of activity Representative Ogan referred to.                
 However, he reiterated there was not any funding.  The Department             
 was generally notified of events such as roughhouse boxing, and the           
 Department attempted to send a volunteer representative to the                
 matches.  That was the extent of the regulatory oversite of the               
 state.  He stated the program received approximately $1,400 per               
 year.                                                                         
                                                                               
 Number 2291                                                                   
                                                                               
 CHAIR JAMES wondered what would happen with the regulations                   
 associated with the repealed statutes.                                        
                                                                               
 Number 2312                                                                   
                                                                               
 MR. BUSH replied the regulations would be repealed also.  He said             
 it was easy for the Division of Occupational Licensing to keep up             
 with the repeal of regulations.  He assured the committee members             
 the necessary regulations would be repealed.                                  
                                                                               
 Number 2340                                                                   
                                                                               
 REPRESENTATIVE ROBINSON wondered about the Athletic Commission.               
 She stated it had not been around very long.                                  
                                                                               
 Number 2347                                                                   
                                                                               
 MR. BUSH responded the Athletic Commission and the Boxing and                 
 Wrestling Commission were viewed as the same operation.  Therefore,           
 when he discussed the issues of the Boxing and Wresting Commission,           
 he was also referring to the Athletic Commission.  The last meeting           
 of the Athletic Commission was in 1992.  The funds did not exist.             
 There had also not been any appointments made in several years.               
                                                                               
 Number 2381                                                                   
                                                                               
 MS. SLAGLE moving forward explained Section 9 also eliminated the             
 Water Resources Board.                                                        
                                                                               
 CHAIR JAMES called on Nico Bus, Department of Natural Resources, to           
 discuss Section 9 further.                                                    
                                                                               
 Number 2402                                                                   
                                                                               
 REPRESENTATIVE OGAN asked Mr. Bus to explain the functions of the             
 Water Resources Board.  He wondered if the functions of the Board             
 would be picked up by somebody else.                                          
                                                                               
 Number 2410                                                                   
                                                                               
 NICO BUS, Acting Director, Central Office, Division of Support                
 Services, Department of Natural Resources, explained the Water                
 Resources Board was an advisory board to the Governor.  It advised            
 the Governor on the use and allocation of water.  The Board had not           
 met since 1993 due to a lack of funding.  In 1993 the funding was             
 deleted.  It had been non-operational since that time.                        
                                                                               
 Number 2447                                                                   
                                                                               
 CHAIR JAMES wondered if the billing of water rights was a function            
 of the Water Resources Board.                                                 
                                                                               
 MR. BUS said the billing of water rights was an administrative                
 function performed through the Division of Mining and Water                   
 Management.                                                                   
                                                                               
 TAPE 96-35, SIDE B                                                            
 Number 0000                                                                   
                                                                               
 MR. BUS further stated the division was in the process of                     
 permitting individuals with water rights.  A fee would be                     
 introduced of which would go to the state treasury.                           
                                                                               
                                                                               
 Number 0023                                                                   
                                                                               
 MS. SLAGLE moving forward explained Section 10 related to the                 
 Department of Fish and Game.  It repealed AS 16.05.390(c) and (d),            
 eliminating the calculation required to transmit the remainder of             
 vendor compensation for issuance of sport fishing and hunting                 
 licenses.  She explained it was also tied to Sections 2 - 4.                  
 Moreover, Section 10 also repealed AS 43.10.160, and AS 43.10.180 -           
 AS 43.10.200, eliminating the Nonresident Affidavit Tax Bond                  
 program Mr. Bartholomew addressed earlier.                                    
                                                                               
 MS. SLAGLE moving forward explained Section 11 addressed                      
 transitional language.                                                        
                                                                               
 MS. SLAGLE explained Sections 12 - 14 addressed the effective                 
 dates.                                                                        
                                                                               
 Number 0052                                                                   
                                                                               
 MS. SLAGLE explained Amendment 1 related to the Department of                 
 Administration.  It shortened the time limit on payments of                   
 warrants from "2 years" to "1 year."  She called on Joe Thomas,               
 Department of Administration, to explain the amendment.                       
                                                                               
 Number 0070                                                                   
                                                                               
 JOE THOMAS, State Accountant, Division of Finance, Department of              
 Administration, explained the time limit was the main issue.  The             
 unclaimed property statutes stated a payroll warrant and intangible           
 property were considered unclaimed property at one year.                      
 Therefore, the amendment made the two consistent.  Furthermore, it            
 would allow the agencies to review the warrants earlier to prevent            
 inadvertently turning one over to a fee finder.  He reiterated the            
 goal was to provide consistency between the statutes.                         
                                                                               
 Number 0112                                                                   
                                                                               
 REPRESENTATIVE PORTER moved to adopt Amendment 1.  Hearing no                 
 objection, it was so adopted.                                                 
                                                                               
 Number 0122                                                                   
 MS. SLAGLE explained Amendment 2 related to the Department of                 
 Administration.  It allowed the calculation of terminal leave                 
 payments to be based on an annualized rate of pay.  She called on             
 Mike McMullen, Department of Administration, to explain the                   
 amendment.                                                                    
                                                                               
 Number 0132                                                                   
                                                                               
 MIKE MCMULLEN, Merit System Personnel Manager, Central Office,                
 Division of Personnel, Department of Administration, explained                
 Amendment 2 accomplished three things.  It first changed the method           
 by which terminal leave was paid off.  The language it repealed had           
 been around since statehood.  It was interpreted to include a                 
 holiday paid during the period in question.  Through the collective           
 bargaining agreements, the holiday pay for termination had been               
 eliminated.  Therefore, the amendment would take care of those                
 covered by statute.                                                           
                                                                               
 Number 0178                                                                   
                                                                               
 CHAIR JAMES wondered if there were any employees currently being              
 paid this way.                                                                
                                                                               
 MR. MCMULLEN replied, "yes."  The amendment covered the partially             
 exempt service and exempt service employees.                                  
                                                                               
 Number 0199                                                                   
                                                                               
 CHAIR JAMES wondered if there was a fiscal impact.                            
                                                                               
 MR. MCMULLEN replied there was a fiscal impact.  He said it was               
 about .4 percent of 1 percent of the payroll.  The funds were                 
 collected as a surcharge on the payroll and placed in the reserve             
 account.  The terminal leave was then paid from the reserve                   
 account.  The difference was 100 days of leave in one year compared           
 to about 300,000 days of leave paid from the general payroll.  The            
 numbers were so small it would appear as a $0 fiscal note.                    
                                                                               
 MR. MCMULLEN said the second change affected the payment of the               
 terminal leave.  It deleted the installment over a period of time.            
                                                                               
 MR. MCMULLEN said the third change included AS 39.20.250(b) as part           
 of the repealer.  Paragraph (b) required an employee to repay the             
 balance of the leave pay, if an employee were to return to work.              
 The option already existed so there was not a need for the                    
 provision to remain in statute.                                               
                                                                               
 Number 0376                                                                   
                                                                               
 CHAIR JAMES wondered about the employees not part of the collective           
 bargaining units.                                                             
                                                                               
 Number 0382                                                                   
                                                                               
 MR. MCMULLEN replied, for the employees outside of a collective               
 bargaining unit, the leave regulation cash-in was provided.                   
                                                                               
 Number 0388                                                                   
                                                                               
 CHAIR JAMES asked if the division had been implementing whatever              
 was in a collective bargaining agreement?                                     
                                                                               
 Number 0392                                                                   
                                                                               
 MR. MCMULLEN replied many things in collective bargaining had been            
 adopted as regulations for all employees.                                     
                                                                               
 Number 0405                                                                   
                                                                               
 CHAIR JAMES stated even though it was in violation of statute.                
                                                                               
 Number 0417                                                                   
                                                                               
 MR. MCMULLEN replied the Department of Law reviewed all regulations           
 before adopting them.                                                         
                                                                               
 Number 0428                                                                   
                                                                               
 CHAIR JAMES commented a person could not take a terminal leave                
 payment and return until it was used.                                         
                                                                               
 MR. MCMULLEN stated, a person did have to repay a terminal leave              
 balance, if it was a substantial amount, upon an employee returning           
 to work.  That payback requirement was being eliminated.                      
                                                                               
 CHAIR JAMES cited an example whereby an employee cashed a six week            
 leave balance.  She wondered what happened when an employee came              
 back to work after three weeks, according to current policy.                  
                                                                               
 Number 0449                                                                   
                                                                               
 MR. MCMULLEN stated the employees covered by statute would be                 
 required to payback three weeks of that cashed out leave balance.             
 The state would then return the three weeks of leave to the books.            
 If the period crossed the calendar year, tax implications were                
 involved.                                                                     
                                                                               
 Number 0503                                                                   
                                                                               
 CHAIR JAMES stated an employee could cash the leave balance and               
 remain working, therefore, being paid twice for the same time.                
                                                                               
 MR. MCMULLEN replied, "yes." It was a correct statement as phrased.           
 Am employee could be paid for working and accumulated leave during            
 the same period of time.  He further said it was an advantage to              
 the state in the long-term to have a leave cash-in program at the             
 current rate.  Otherwise an increase or promotional amount would be           
 calculated.                                                                   
                                                                               
 Number 0548                                                                   
                                                                               
 CHAIR JAMES said the cost of the program to provide leave would be            
 more expensive.  It became a benefit as apposed to a leave program.           
 She said that did not happen in the private sector.                           
                                                                               
 Number 0572                                                                   
                                                                               
 MR. MCMULLEN replied there were programs where an employee could              
 buy leave time or cash-out his leave and work.  There were minimum            
 requirements for time off the job in statute and in the collective            
 bargaining agreements.  He said they were minimal, however.                   
                                                                               
 Number 0603                                                                   
                                                                               
 REPRESENTATIVE PORTER moved to adopt Amendment 2.  Hearing no                 
 objection, it was so adopted.                                                 
                                                                               
 Number 0615                                                                   
                                                                               
 MS. SLAGLE explained Amendment 3 related to the Department of                 
 Commerce and Economic Development and the Department of Revenue.              
 It allowed the department to collect taxes on insurance premiums              
 more frequently than on an annual basis.  A quarterly basis was               
 suggested.  It would generate more money for the state because the            
 payments would be received more frequently.  She called on Marianne           
 K. Burke, Department of Commerce and Economic Development.                    
                                                                               
 Number 0652                                                                   
                                                                               
 MARIANNE K. BURKE, Director, Central Office, Division of Insurance,           
 Department of Commerce and Economic Development, explained                    
 Amendment 3 provided for the more frequent collection of insurance            
 premiums.  The dollar amount was approximately $26 million to $27             
 million, money that went directly to the general fund.  It would              
 apply to all insurance companies in the state, 1,100.  Alaska was             
 one of the last states to still collect on an annual basis.                   
 Therefore, the insurance companies were set-up to pay the tax on a            
 more frequent basis.  Most states collected on a quarterly basis,             
 while some states collected on a monthly basis.  The amendment also           
 provided for an electronic means to pay the tax, accelerating the             
 receipt of the money into the state treasury.  The insurance                  
 companies also recognized that Alaska was one of the last states to           
 move in this direction.                                                       
                                                                               
 Number 0737                                                                   
                                                                               
 REPRESENTATIVE PORTER asked if Ms. Burke anticipated quarterly                
 payments.                                                                     
                                                                               
 MS. BURKE replied, "yes."                                                     
                                                                               
 Number 0744                                                                   
                                                                               
 REPRESENTATIVE PORTER moved to adopt Amendment 3.  Hearing no                 
 objection, it was so adopted.                                                 
                                                                               
 Number 0766                                                                   
                                                                               
 CHAIR JAMES commented Representatives Ivan and Green had to leave             
 early to attend another meeting.  She explained Representative Ivan           
 presented an amendment.  She referred the committee members to page           
 4, line 6, and explained the amendment inserted "or repeal" after             
 the word "adopt" in the provision.                                            
                                                                               
 Number 0792                                                                   
                                                                               
 REPRESENTATIVE OGAN moved to adopt the conceptual amendment.                  
 Hearing no objection, it was so adopted.                                      
                                                                               
 Number 0804                                                                   
                                                                               
 CHAIR JAMES explained Representative Ivan would like an analysis of           
 all the repealer sections in the bill.                                        
                                                                               
 Number 0818                                                                   
                                                                               
 REPRESENTATIVE OGAN suggested a copy be sent to all the committee             
 members.                                                                      
                                                                               
 Number 0840                                                                   
                                                                               
 JOHN GEORGE, Lobbyist, representing the American Council of Life              
 Insurance and the National Association of Independent Insurers,               
 stated the companies he represented were willing to "bite the                 
 bullet" on the taxes incurred due to Amendment 3.  The wording,               
 however, did not specifically state the filing time frame.  He                
 suggested including "not more than quarterly," for clarification.             
 He would be concerned if it was more often than quarterly.                    
                                                                               
 Number 0892                                                                   
                                                                               
 CHAIR JAMES said she wanted to here from the Administration.                  
                                                                               
 Number 0915                                                                   
                                                                               
 MR. BARTHOLOMEW said the Department of Revenue worked with the                
 Administration closely on this section.  The evidence indicated a             
 quarterly payment was the intent.  He said he did not feel there              
 would be an objection from the Administration.                                
                                                                               
 Number 0940                                                                   
                                                                               
 CHAIR JAMES commented Representative Porter did ask that question             
 directly.                                                                     
                                                                               
 Number 0950                                                                   
                                                                               
 REPRESENTATIVE PORTER moved to adopt a conceptual amendment to                
 include a quarterly provision for the collection of taxes for                 
 clarification.  Hearing no objection, it was so adopted.                      
                                                                               
 Number 0983                                                                   
                                                                               
 REPRESENTATIVE PORTER moved that CSHB 415(STA) move from committee            
 with individual recommendations and attached fiscal notes.  Hearing           
 no objection, it was so moved from the House State Affairs                    
 Committee.                                                                    
 HB 443 - INCREASE MOTOR FUEL TAX                                            
                                                                               
 The next order of business to come before the House State Affairs             
 Committee was HB 443.                                                         
                                                                               
 CHAIR JAMES called on Sam Kito III, Department of Transportation              
 and Public Facilities, to present the committee substitute.                   
                                                                               
 Number 1062                                                                   
                                                                               
 SAM S. KITO III, Legislative Liaison/Special Assistant, Office of             
 the Commissioner, Department of Transportation and Public                     
 Facilities, explained a brief summary of the harbor situation in              
 the state of Alaska was before the committee members for review.              
 It showed historical funding from 1989 to the present.  He further            
 explained the revised fiscal note tied the increase in tax to the             
 dedicated fund allowing the Department to receive the revenue from            
 the taxes.  It was reflected under "maintenance" for the Department           
 of Transportation and Public Facilities.                                      
                                                                               
 Number 1124                                                                   
                                                                               
 CHAIR JAMES wondered how that related to the constitutional                   
 amendment in the House Finance Committee.  Did the constitutional             
 amendment allow the money to be spent on the maintenance of public            
 facilities?                                                                   
                                                                               
 Number 1132                                                                   
                                                                               
 MR. KITO III replied the constitutional amendment allowed the                 
 spending of revenue from the dedicated fund for maintenance of a              
 highway system.  A definition was offered recently in the House               
 Finance Committee that stated "maintenance" included any associated           
 facilities with the highway system.                                           
                                                                               
 Number 1168                                                                   
                                                                               
 CHAIR JAMES announced she did not have a written amendment prepared           
 today.  Nonetheless, she suggested an amendment to divide the 14              
 cents of gas tax into two year implementations - 7 cents one year,            
 7 cents the next.  She called on a committee member to support and            
 move her amendment.                                                           
                                                                               
 Number 1218                                                                   
                                                                               
 REPRESENTATIVE PORTER stated previous testimony indicated there was           
 concern about the jump to 14 cents.  The amendment was one approach           
 to "soften the blow."                                                         
                                                                               
 Number 1261                                                                   
                                                                               
 REPRESENTATIVE ROBINSON also supported the amendment.  It was a               
 major increase.  She believed it was needed, however.  She was                
 confused about the constitutional amendment in the House Finance              
 Committee and asked for an explanation.                                       
                                                                               
 CHAIR JAMES replied the House Finance Committee was working on the            
 constitutional amendment passed from the House State Affairs                  
 Committee earlier.  It was amended to include a marine fuel tax in            
 the House Transportation Committee.  There was concern because the            
 motor fuel tax would not cover the current cost ($75 million spent,           
 $21 million brought in), while the marine fuel tax would cover the            
 current cost ($1 million spent, $7 million brought in).  Therefore,           
 $6 million of existing taxes would be taken from the general fund             
 to be used for harbors and docks.  There was also discussion of               
 transferring harbors and docks to the local municipalities for                
 future maintenance.  Consequently, CSHB 443(STA) was subject to the           
 passage of the constitutional amendment.                                      
                                                                               
 Number 1426                                                                   
                                                                               
 REPRESENTATIVE PORTER wondered what the mechanism would be to                 
 channel the tax money to the municipalities to maintain the ports.            
                                                                               
 Number 1455                                                                   
                                                                               
 MR. KITO III replied the increase in the marine motor fuel tax                
 would be used to offer capital appropriations to upgrade and                  
 transfer facilities.  The Department was planning to implement a              
 sharing program with the localities.  The revenue collected by the            
 legislature into the dedicated fund could be appropriated directly            
 to the communities.  If, at the end of the transfer program the               
 state decided it was no longer interested in collecting taxes for             
 the harbors, the tax rate could be lowered by a future legislature.           
 The intent was to transfer state facilities out-of-state hands.               
                                                                               
 Number 1525                                                                   
                                                                               
 REPRESENTATIVE PORTER wondered if the immediate intent was to                 
 upgrade the facilities so that they could not be transferred.                 
                                                                               
 Number 1530                                                                   
                                                                               
 MR. KITO III replied, "yes."                                                  
                                                                               
 Number 1535                                                                   
                                                                               
 CHAIR JAMES wondered if the purpose of the marine fuel tax was to             
 only fix docks and harbors, or did it also have a general fund                
 implication.  Currently, it did have a general fund implication.              
 Moreover, she aired her concern of the issue of the fishing vessels           
 that did not buy their marine fuel tax from Alaska because it could           
 be bought cheaper from Seattle.  She suggested a use tax to help              
 solve this issue.  She announced it was possible to attach language           
 to address the issue in CSHB 443(STA).  She explained to the                  
 committee members that she was going in that direction.                       
                                                                               
 Number 1646                                                                   
                                                                               
 REPRESENTATIVE PORTER moved to adopt the conceptual amendment to              
 include a two year implementation of the 14 cents gas tax of 7                
 cents the first year and 7 cents the next year.  Hearing no                   
 objection, it was so adopted.                                                 
                                                                               
 Number 1660                                                                   
                                                                               
 REPRESENTATIVE ROBINSON commented the amendment would change the              
 fiscal note.                                                                  
                                                                               
 Number 1677                                                                   
                                                                               
 CHAIR JAMES also commented it would change the fiscal note.                   
                                                                               
 Number 1677                                                                   
                                                                               
 CHAIR JAMES suggested deleting Section 5, "TAX REFUND ADJUSTMENT."            
 The legislature needed to follow the issue further to determine if            
 more taxes or less taxes were needed.                                         
                                                                               
 Number 1726                                                                   
                                                                               
 REPRESENTATIVE OGAN moved to delete Section 5, "TAX AND REFUND                
 ADJUSTMENT."  Hearing no objection, it was so deleted.                        
                                                                               
 CHAIR JAMES announced she was willing to move the bill forward to             
 the next committee of referral before including the use tax                   
 amendment.                                                                    
                                                                               
 Number 1780                                                                   
                                                                               
 REPRESENTATIVE WILLIS moved that CSHB 443(STA) move from the                  
 committee with individual recommendations and attached fiscal                 
 notes.  Hearing no objection, it was so moved from the House State            
 Affairs Committee.                                                            
                                                                               
 Number 1832                                                                   
                                                                               
 REPRESENTATIVE OGAN stated he did not object to moving the bill               
 forward.  It was tied to the constitutional amendment and to the              
 people.  He believed every chance should be given to the people to            
 vote directly on tax issues.                                                  
 Number 1891                                                                   
                                                                               
 CHAIR JAMES asked the committee members to waive HCR 29 - contest             
 to name the new ferry - from the House State Affairs Committee.  No           
 objections were voiced.                                                       
                                                                               
 Number 1990                                                                   
                                                                               
 CHAIR JAMES further announced a tentative presentation was                    
 scheduled for April 2, 1996 on HAARP.                                         
                                                                               
 Number 2095                                                                   
                                                                               
 ADJOURNMENT                                                                   
                                                                               
 CHAIR JAMES adjourned the House State Affairs Committee meeting at            
 9:35 a.m.                                                                     
                                                                               
                                                                               

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