Legislature(1995 - 1996)
04/12/1995 09:40 AM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
April 12, 1995
9:40 a.m.
TAPES
SFC-95, #30, Side 1, (000-575)
SFC-95, #30, Side 2, (575-end)
CALL TO ORDER
Senator Rick Halford, Co-chair, convened the meeting at
approximately 9:40 a.m.
PRESENT
Co-chair Halford and Senators Phillips, Sharp, Donley and
Rieger were present. Co-chair Frank arrived shortly after
the meeting began. Senator Zharoff was not in attendance.
Also Attending: Stan Ridgeway, Deputy Director, Vocational
Rehabilitation, Dept. of Education; Dean Guaneli, Criminal
Division, Dept. of Law; Kathy Tibble, Division of Family and
Youth Services, Dept. of Health & Social Services; Dave
Hutchens, Executive Director of the Alaska Rural Electric
Cooperative Association; and Willie Anderson, Representing
the National Education Assoc.
Teleconference: Victor Gunn, Deputy Chief of Police, Dept.
of Public Safety, Fairbanks; Don Schroer, Alaska Public
Utilities Commission, Anchorage; Bob Lohr, Executive
Director, Alaska Public Utilities Commission, Anchorage, and
Janey Winnegar, Representing the National Rifle Association,
Palmer.
SUMMARY INFORMATION
SB 117 STATEWIDE INDEPENDENT LIVING COUNCIL
Stan Ridgeway gave testimony in support of SB 117. SB
117 (HES) was REPORTED OUT of committee recommending "do
pass" with a fiscal note from the Dept. of
Education of $142.6.
SB 64 CONVERT AK RR TO PRIVATE CORPORATION
Senator Rieger moved Amendment #1, and it was ADOPTED.
The
bill is being held pending further discussion.
SB 26 OFFENSES BY JUVENILE USING FIREARMS
Discussion was had by Victor Gunn of Fairbanks; Dave
Hutcheson and Willie Anderson of the National Education
Association; and Dean Guaneli, Dept. of Law. A
Conceptual
Amendment changing "criminal offense" to "crimes
against
a person" and "firearms" to "deadly weapon" was
ADOPTED.
CSSB 26 (FIN) was REPORTED OUT of committee with 6 zero
fiscal notes (see page 7 in minutes for details), and
a "do pass" recommendation.
SB 54 ELECTRIC UTIL & SOLID WASTE REMOVAL
Don Schroer and Bob Lohr of the APUC testified against
the
bill, but endorsed the two amendments presented by
Senator
Sharp. Amendment #1 and #2 was ADOPTED. CSSB 54 (L&C)
is
being held for further discussion.
SENATE BILL NO. 117
"An Act establishing a statewide independent living
council and clarifying its relationship with existing
agencies; and providing for an effective date."
Stan Ridgeway, Deputy Director, Vocational Rehabilitation
testified that SB 117, the establishment of a Statewide
Independent Living Council, was introduced by Senator
Halford at the request of the Dept. of Health & Social
Services. In order for Alaska to continue receiving federal
funds for independent living services, the state must
establish in statute a Statewide Independent Living Council.
At the present time, the state receives approximately $900.0
in federal money, along with $602.0 in state money for a
total of $1.5 million used to fund independent living
centers throughout the state. As part of the rehabilitation
act of 1992, there was a requirement that a Statewide
Independent Living Council be appointed by the governor. In
order to receive those funds, the Independent Living Council
and the Division of Vocational Rehabilitation had to jointly
develop a state plan for independent living services. That
was accomplished in 1993 when Governor Hickel appointed the
first council in October of 1993. Because it was a federal
law, there was an assumption that it would not need to be in
state statute. However, that was challenged later that
year, and in 1994 Governor Hickel reappointed the council.
It is our understanding that it must be established in
statute by the end of this legislative session for the
Independent Living Council to continue operation.
Senator Sharp MOVED to adopt CSSB 117 with accompanying
fiscal note and individual recommendations. No objection
being heard, CSSB 117 was REPORTED OUT of committee with a
$142.6 fiscal note from the Dept of Education and a "do
pass" recommendation from the Committee.
SENATE BILL NO. 64
"An Act relating to the dissolution of the Alaska
Railroad Corporation and providing for a successor
corporation; and providing for an effective date."
Senator Rieger testified that this legislation is a step
towards the privatization of the Alaska Railroad. This will
reshape the corporation into a form, the ownership of which,
is represented by shares of stock. This will enable the
transfer to private ownership, either through: the sale of
the entire corporation, through the sale of individual
shares, or appropriations of individual shares of stock.
This bill directs the railroad to form a successor
corporation represented by shares of stock. Senator Rieger
testified that the Board of Directors have been paralyzed by
the actions of the legislation imposed over the past years.
He feels this has been a detriment to economic development
in the state. The Alaska State Library has contacted the
legislature asking if there could be help in securing the
railroad historical records. He offered an amendment which
would transfer the historical records of the Alaska Railroad
to the Library, except those records which the railroad
should appropriately keep in their own archives. The
railroad has recommended an amendment to the amendment which
is technical. Senator Rieger MOVED amendment #1 for
adoption. No objection being heard, amendment #1 was
ADOPTED.
Senator Phillips made reference to a position paper from the
railroad, dated March 10, 1995. He asked for the formal
position by the Alaska Railroad. Senator Rieger responded
that they did not have a formal position. The Railroad had
concerns in some areas of the original bill. Those areas of
concern have been addressed. One of the ideas that the
railroad offered for the legislature's consideration, was
putting the shares into a trust to be administered by a
trustee, rather than voted by the governor as the owner of
the shares. This bill is crafted to allow the legislature
to appropriate the shares to a trust.
Co-chair Halford supports moving the railroad towards the
private sector. As long as it is in the public sector,
there is not much control, and expanding their independence
should only be towards privatization. Senator Rieger stated
that the legislation should be accepted only as an interim
measure. The legislature is going to have to appropriate
the shares subsequently, or force the sale of the shares to
consummate the transaction. The only thing that is gained
is avoiding a mandated distress sale, which is the other
alternative that has been offered from time to time. He
feels that this will help to get the maximum proceeds when
the railroad is sold. Co-chair Halford wanted to know if
this legislation weakens the ability to interact with the
railroad on various issues? Senator Rieger said that it
does reduce the legislature's strength.
There was considerable discussion regarding language
cleanup. It was agreed to hold the bill for a later date.
SENATE BILL NO. 26
"An Act providing for automatic waiver of juvenile
jurisdiction and prosecution of minors as adults for
certain violations of laws by minors who use firearms
to commit criminal offenses and relating to the
sealing of the records of those minors."
Senator Donley explained that SB 26 would waive juvenile's
over the age of 14 who commit a second crime, utilizing a
firearm, to adult court. The legislation has the support of
police associations, national rifle association, and the
organization representing pubic safety employees of the
state. At the current time, there is no mandatory waiver of
juveniles. His intent to send a message that abuse of
firearms is not condoned by society and to take it very
seriously. This has been brought to his attention by
educators in his community who have said that after passage
of the laws that forbid firearms from being brought to
schools, the police were frustrated, because when they did
apprehend individuals who carried firearms to school there
was no consequence.
Co-chair Halford supports the legislation and asked that
there be an amendment to include deadly weapons and
defensive weapons.
Senator Rieger asked if the waiver into adult court would
mean the individual is subject to the laws of the adult?
Senator Donley responded that it was correct, except if
incarcerated, then different rules apply. He asked if the
results of being waived include juvenile consequences, as
well as adult consequences to the crime? Senator Donley
responded that both consequences apply.
There was a discussion regarding other forms of weapons.
Firearms are deadly. The purpose of this legislation is to
stop the firearm abuse before there are serious
consequences.
Kathy Tibble, Division of Family and Youth Services, Dept of
Health & Social Services testified that the department is
opposed to this legislation with the age being lowered to
14, and because of the broadening of the type of offenses.
There is a concern that a juvenile could be adjudicated for
a misdemeanor offense with use of a firearm, and then if
involved in a more serious offense, be waived to adult
jails. At this point, a waiver to an adult court means a
waiver to adult prisons. The department believes that most
14 year olds still are amenable to treatment, therefore they
support continuing with the statute that allows for a waiver
to adult court for heinous crimes rather than to mandate an
automatic waiver on all 14 year olds for this broad category
of offense. Senator Phillips asked if the governor is
opposed to this bill. Ms. Tibble responded that it was her
understanding.
Co-chair Halford asked if the governor would be opposed to
the bill if it dealt with felony offenses instead of felony
and misdemeanor offenses? Ms. Tibble referred the question.
He asked if the language read, "offense against the person"?
There was considerable discussion regarding deadly and
defensive weapons. Senator Donley read the definition of
deadly and defensive from the statute. Co-chair Halford
wants an amendment that puts into adds language referring to
deadly weapons.
Senator Donley pointed out that the argument that the minor
would go to adult prison presumes that the second offense
that the minor commits is somehow subject to mandatory
sentencing. It would have to be a major offense, to commit
the minor to prison if convicted.
Willie Anderson, National Education Association testified
that NEA supports the legislation because of the crime in
the public school system. There is an increase of harm as a
result of firearms.
Victor Gunn, Deputy Chief of Police, Dept of Public Safety
in Fairbanks spoke to supporting the bill. He felt that
adding the words "deadly weapons" to the bill, it would make
it more of a deterrent to crimes, versus just "firearms".
The message to students regarding the use of firearms has
been conveyed through other laws. The message of adding
deadly weapons would make it much stronger, and limiting it
to felonies would make the bill more palatable. He stated
that there are already penalties attached to the possession
of and the threatened use of a firearm. He emphasized
sending an overall message of deterrents to the youth, which
he is in favor of. The addition of deadly weapons and
limiting it to felonies would be highly supported by the
department.
Co-chair Halford suggested that instead of applying it to
felonies only, it could be applied to "crimes against the
person," which would eliminate some misdemeanors, but not
all, such as the highest class of misdemeanors, which is
assault.
Mr. Gunn suggested that it would not be restrictive to limit
the legislation to felonies.
Co-chair Halford reminded the committee that this
legislation is not applying the penalty, but rather that
they will be tried as adults. Only after there is a
confirmation of guilt do the penalties go forward, which
rests with the judge. Senator Donley suggested moving to
the format of the second offense with a deadly weapon or a
crime against the person. The distinction should not be
between a felony and a misdemeanor, as whether there was an
injury, or a threat of an injury to an other person.
End Tape #30, Side 1
Begin Tape #30, Side 2
Dean Guaneli, Criminal Division, Dept of Law, stated that he
understood that the committee was interested in hearing
testimony when, and under what circumstances, force can be
used in self defense. If the question is expanding this
bill to have additional juveniles waived to adult
jurisdiction, these are policy questions to be determined by
the department. In responding to Co-chair Halford, he
stated that from a prosecution standpoint, the more
flexibility that the prosecution has to resolve a case, the
better. If additional penalties or options available under
the law, send a particular juvenile one way or the other,
the preference is to have that discretion. However, it then
becomes necessary to decide what is best for that particular
juvenile for that case, and that becomes largely a question
of what sorts of resources does the Dept. of Health & Social
Services have to treat any particular individual, what sorts
of resources would the Dept. of Corrections have to treat
that individual if they are handled as an adult. Those
kinds of allocations resource questions need to be discussed
with those departments. There is a difficulty in dealing
with young offenders. The departments do not have the
flexibility within the system to create separate units for
young offenders. It is one thing to deal with a 16 of 17
year old who has committed a murder, they have over the
years dealt with a number of those individuals. It is
another matter to deal with a 15 year old, whose only crime
is having a firearm or handling firearms. Senator Halford
asked if there is a status offense that is minor in
possession of a firearm? Mr. Guaneli stated that there is,
under 16 without parental permission is a misdemeanor
offense. There was discussion regarding various scenarios.
Co-chair Halford asked if the waivers in this proposed bill
mandatory, or can the Dept of Law within the prosecutors
office, really determine whether there will be a
consideration for the waiver? Mr. Guaneli stated that if
someone is charged with an offense, then the statute will
dictate whether that person goes to juvenile court or adult
court. Prosecutors always have the discretion to charge a
lower level of offense. That power exists currently with
the juvenile law. Co-chair Halford noted the opposition of
the administration. If the bill were amended to include
only felonies would the administration's position change?
Mr. Guaneli responded that there would be a greater comfort
level, but without consulting the various departments
involved, he would not commit. Co-chair Halford again asked
about "crimes against the person". Mr. Guaneli stated that
decisions from the executive branch come from resource
considerations as much as what is best for the public and
the individual.
Senator Sharp recommended a conceptual amendment to broaden
the definition to deadly weapon, make it a crime against the
person only, and apply to the second offense.
Janey Winnegar, Representing the National Rifle Association
in Palmer testified that their concern is that all crimes
against a person should be covered in this legislation. It
is felt that any weapon should be considered a felony. She
stated that in talking with the law enforcement agencies,
they support crime strike recommendations.
Senator Donley offered the conceptual amendment to change
the terminology to "crimes against the person"; change the
word "firearms" to "deadly weapon". No objection being
heard the conceptual amendment was ADOPTED.
Senator Donley MOVED to adopt SB 26 (FIN) with accompanying
zero fiscal notes, with individual recommendations. No
objection being heard CSSB 26 (FIN) was REPORTED OUT of
committee with 6 zero fiscal notes from Dept of Health &
Social Services, Dept of Administration, Dept of Public
Safety, and Dept of Law, with a "do pass" recommendation by
the committee.
SENATE BILL NO. 54
"An Act relating to exclusive service areas for
utilities certificated to provide electric utility
service and to the definition of 'general public' for
utilities furnishing electric service."
Senator Sharp offered amendment #1 which changes the title
to, "relating to employees of the Alaska Public Utilities
Commission;", he explained the rest of the change of the
amendment which would allow two special assistants, though
there are no funds available until next year. Senator Sharp
MOVED amendment #1. No objections being heard it was
ADOPTED. Amendment #2 was offered which is a language
change to coincide with the title change. Also there was a
new expiration of Feb. 1 put into place. Senator Sharp
MOVED to adopt amendment #2. No objections being heard it
was ADOPTED.
Co-chair Halford explained that the remaining portion of the
bill is the exclusive areas for electric utilities only.
The exemption provision except for refuse collection is what
needs to be addressed, along with a change to the definition
section.
Dave Hutchens, Executive Director of the Alaska Rural
Electric Coop Assoc. stated that he was in strong support of
the bill. Section 4 is a conforming amendment in the statute
conforming to Section 2 which is the operative policy
statement. The background is that a number of years ago,
there was retail competition among the utilities. Utilities
were running lines up and down the same streets, and it was
a misallocation of resources. In order to stop the border
wars, a Board was created. In Section 2, the PUC gave the
commission the directive and instructions to separate the
electric utilities services. The job is now complete. The
purpose of this legislation is to enable the commission to
keep the utilities services separate. He explained that the
attached fiscal note of $100.0 a year to keep from making
changes and asked that there be in its place, a zero fiscal
note.
Mr. Hutchens explained Section 4 changes which strikes out
lines 6 and 7, on page 2. The change is proposed as a
compromise to legislation previously introduced in the
1980's that concerned gas and oil companies. Since that
situation is long gone, the language suggests that any new
customer coming into a service area was up for grabs. The
second change on line 7 is a language change.
Co-chair Frank asked if the bill was introduced at his
request. Mr. Hutchens explained that it had originally be
requested to be included in the APUC sunset extension bill.
Senator Kelly has introduced this as a new bill. Co-chair
Frank inquired about the refuse portion of the bill. Mr.
Hutchens stated that was not at his request, that was added
in Labor and Commerce Committee, and he has no interest in
that area. The exemption does apply to electrical utilities.
Co-chair Halford inquired if a municipal government can
regulate an electric or telephone utility that is exempted
under the APUC? Mr. Hutchens indicated that they can not.
He inquired about refuse, stating that if it is deregulated,
then it needs to be backed up with a exemption from the
municipal regulation as well. Otherwise, it ends up being a
battle at the municipal level, leading to the take over of a
company, because the municipality may want to provide the
service on a government level.
Co-chair Frank feels the garbage deregulation is
inappropriate in this section and offered an amendment to
remove it.
Senator Rieger spoke to the provisions of electric service
from the refinery in Valdez and how that might have an
effect on the Intertie. Would this prohibit the refinery
from providing surplus electric power to the CVEA region.
Mr. Hutchens assured Senator Rieger that it would not. This
deals only with the retail sales of the electricity, and the
provision of the wholesale service is protected under
federal law. Competition is encouraged and protected under
federal law. Under Alaska law, anyone has the right to
serve themselves, to provide their own generation. Under
federal law, they have the right to sell their surplus to
the utility in that area.
Don Schroer, Alaska Public Utilities Commission in Anchorage
offered testimony against this legislation because it is
contrary to the public interest and would take the state
backwards. The Alaska Supreme Court has concluded that
under current law, a certificate issued by the Alaska Public
Utilities Commission does not confer in exclusive service
area in a public utility. Chugach Electric Association v
City of Anchorage, 426 P2d 1001 (1967). This has been the
law in Alaska for 28 years. This bill would overturn that
decision for electric utilities. They already have de facto
monopoly status, because the APUC has not authorized more
than one provider in a given area. This makes sense in the
vast majority of cases. But conditions change and
technology evolves. What if, in the future, competition
makes sense to the legislature, benefits the customer and is
in the public interest? By the way, these decisions are
best left to the legislature, because inevitably they
involve political as well as regulatory questions. How
would exclusionary jurisdiction be reversed to allow the
customer these benefits? It may very well require
significant compensation to the electric utilities for their
loss of monopoly rights. To my knowledge there has been no
legal or economic analysis of this potentially massive
transfer of wealth. However, if despite these concerns, you
do decide to move the bill, the Commission supports Senator
Sharp's two proposed amendments, one to Classify two vacant
Commission positions as partially exempt; and the other to
change the appointment date for commissioners from November
1 to February 1. We ask that you consider one other
amendment: to create an exemption to the Procurement Act for
commission hiring of expert witnesses. The commission
recommends adding an exemption to the Procurement Act,
36.30.850 to allow it to hire its expert witnesses for cases
in a timely manner. A new subsection could be added to
read: "contracts for professional services or testimony
related to proceedings before the Alaska Public Utilities
Commission, including procurement pursuant to AS
42.05.111(b)." This is modelled after an existing exemption
provided to the Dept of Law. The commission has been unable
to procure the professional services of expert witnesses in
a timely fashion. The deadlines established in proceedings
do not permit the procurement process to operate to produce
a successful bidder in time for the contractor to properly
prepare the case. Other parties to the proceedings
utilizing private sector procurement procedures are able to
hire their expert witnesses on a timely basis, the
commission is not. This either delays the processing of
cases, or forces the commission's witness to rush through
the preparation of a case, thus affecting the accuracy and
credibility of the work, as well as costing the state more
for overtime. He stated that the commission supported
Senator Sharp's two amendments. He reported that there are
still language problems with the section, and he will fax
down suggested changes to the section.
Senator Sharp asked why bureaucrats think they have the
right to regulate. Mr. Schroer stated that the basis comes
from lack of funds and not having the ability to serve the
public as intended.
Bob Lohr, Executive Director, Alaska Public Utilities
Commission stated that the intent of the testimony was the
decision ought to be made by the legislature, not by the
commission with respect to whether competition is
appropriate. It would not be a bureaucrat's decision under
that proposal, rather it would be a legislative decision.
Co-chair Halford stated that Co-chair Frank is interested in
pursuing this bill further, and with the fax information
coming from the APUC, the bill will be taken up at a later
time.
The meeting was RECESSED at approximately 11:10 a.m.
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