Legislature(1997 - 1998)

03/12/1998 01:37 PM Senate L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
         SENATE LABOR AND COMMERCE COMMITTEE                                   
                    March 12, 1998                                             
                      1:37 P.M.                                                
MEMBERS PRESENT                                                                
Senator Loren Leman, Chairman                                                  
Senator Jerry Mackie, Vice Chairman                                            
Senator Lyman Hoffman                                                          
MEMBERS ABSENT                                                                 
Senator Tim Kelly                                                              
Senator Mike Miller                                                            
COMMITTEE CALENDAR                                                             
SENATE BILL NO. 329                                                            
"An Act establishing an exemption for investment clubs from the                
business license requirement."                                                 
     - MOVED SB 329 FROM COMMITTEE                                             
SENATE BILL NO. 319                                                            
"An Act relating to arbitration; amending Rules 57(a) and 77(g),               
Alaska Rules of Civil Procedure; and providing for an effective                
     - MOVED CSSB 319(L&C) FROM COMMITTEE                                      
SENATE BILL NO. 233                                                            
"An Act extending the termination date of the Alcoholic Beverage               
Control Board."                                                                
     - MOVED SB 233 FROM COMMITTEE                                             
SENATE BILL NO. 330                                                            
"An Act relating to underground facilities."                                   
     - MOVED CSSB 330(L&C) FROM COMMITTEE                                      
PREVIOUS SENATE COMMITTEE ACTION                                               
SB 329 - No previous action to consider.                                       
SB 319 - See Labor and Commerce Committee minutes dated 3/10/98.               
SB 233 - No previous action to consider.                                       
SB 330 - No previous action to consider.                                       
WITNESS REGISTER                                                               
Ms. Annette Kreitzer, Staff                                                    
Senator Loren Leman                                                            
State Capitol Bldg.                                                            
Juneau, AK 99811-1182                                                          
POSITION STATEMENT: Commented on SB 329 for sponsor and on SB 330.             
Mr. Floyd Damron, Co-President                                                 
Alaska Council of the National Association of Investors Corporation            
(907) 276-6833                                                                 
POSITION STATEMENT: Supported SB 329.                                          
Ms. Catherine Reardon, Director                                                
Division of Occupational Licensing                                             
Department of Commerce and Economic Development                                
P.O. Box 110806                                                                
Juneau, AK 99811-0806                                                          
POSITION STATEMENT: Commented on SB 329.                                       
Mr. Jerry Burnett, Staff                                                       
Senator Randy Phillips                                                         
State Capitol Bldg.                                                            
Juneau, AK 99811-1182                                                          
POSITION STATEMENT: Commented on SB 319 for sponsor.                           
Mr. Don Dapcevich, Executive Director                                          
State Advisory Board on Alcoholism and Drug Abuse                              
P.O. Box 0608                                                                  
Juneau, AK 99811                                                               
POSITION STATEMENT: Supported SB 233.                                          
Ms. Charity Kadow, President                                                   
Spenard Community Council                                                      
(907) 563-6634                                                                 
POSITION STATEMENT: Supported SB 233.                                          
Mr. Doug Griffin, Director                                                     
Alcohol Beverage Control Board                                                 
550 W 7th, Ste 350                                                             
Anchorage, AK 99501                                                            
POSITION STATEMENT: Supported SB 233.                                          
Mr. Jim Rowe, Executive Director                                               
Alaska Telephone Association                                                   
201 E 56th Ave., Suite 114                                                     
Anchorage, AK 99518                                                            
POSITION STATEMENT: Supported SB 330.                                          
Mr. Mike Golat                                                                 
Unalaska, AK                                                                   
(907) 581-1260                                                                 
POSITION STATEMENT: Supported SB 330.                                          
Mr. Randy Nelson                                                               
Alaska Telephone Association, Engineering and Planning Committee               
201 E 56th Ave., Suite 114                                                     
Anchorage, AK 99518                                                            
POSITION STATEMENT: Supported SB 330.                                          
ACTION NARRATIVE                                                               
TAPE 98-14, SIDE A                                                             
Number 001                                                                     
            SB 329 - INVESTMENT CLUB LICENSE EXEMPTION                         
CHAIRMAN LEMAN called the Senate Labor and Commerce Committee                  
meeting to order at 1:37 p.m. and announced SB 329 to be up for                
MS. ANNETTE KREITZER, Staff to the Senate Labor and Commerce                   
Committee, said this legislation was introduced because of a                   
discrepancy in how Alaska statutes are interpreted.  Mr. Floyd                 
Damron, Alaska Regional Council and National Association of                    
Investors Corporation, contacted them regarding this issue saying              
they had been advised that they need to purchase a business license            
to be able to be an investment club in Alaska.  That's not the case            
in other states.  Alaska is the sole exception to that.                        
MR. FLOYD DAMRON, Co-President, Alaska Council of the National                 
Association of Investors Corporation, said they are a newly formed             
council that represents 112 investment clubs in Alaska with about              
1,500 - 1,600 Alaska residents as members.  Their national                     
organization has about 36,000 clubs made up of about 600,000                   
people.  He explained that the primary purpose of the Alaska                   
Council and investment clubs is educational.  A group of friends               
get together with a small amount of money, so they can learn how to            
invest in the U.S. stock market.  The Securities and Exchange                  
Commission does not view this type of investment club as being                 
securities dealers or brokers.                                                 
MR. DAMRON said they are uncertain as to whether or not they need              
to have a business license.  Polls of investment clubs indicated               
most of them have not purchased business licenses and they,                    
therefore, think that there is an exemption.  He didn't think there            
would be any significant decrease in monies to the State of Alaska             
without licensing.                                                             
MS. CATHERINE REARDON, Director, Division of Occupational                      
Licensing, said they have no opposition to this bill.  She said                
they have given conflicting answers to investment clubs about                  
whether or not they need business licenses.  Part of the problem               
has been that the definition of business is extremely difficult for            
staff and the public to understand.  She thought it would be a good            
idea to clarify it in the future.  There are only a couple of                  
investment clubs that hold business licenses.  Therefore, the                  
fiscal note shows $300 in lost revenue, but it may be less because             
of her Division giving conflicting advice.  She would feel                     
comfortable making a $0 fiscal note, so the bill would not need an             
extra committee stop.                                                          
CHAIRMAN LEMAN said he thought it would be helpful if she could                
provide a revised fiscal note.                                                 
MS. REARDON said she also had a revised definition of "business" to            
offer "engaging or offering to engage in a trade, profession, or               
activity with a goal of receiving a benefit in exchange for                    
provision of good services or property.  Business does not include             
the following activities...(include the exemptions that exist in               
law)" and add to that the exemption for investment clubs and the               
existing exemption for giving or supplying services as an employee,            
and, finally, the current exemption for giving or furnishing of                
goods and services by a person who does not represent to be                    
regularly engaged in those activities.                                         
CHAIRMAN LEMAN asked if that definition would make it easier to                
administer her Division.                                                       
MS. REARDON said it would, because it would delete language like               
"calling or vocation."  The whole world is business technically in             
this definition.                                                               
Number 172                                                                     
SENATOR HOFFMAN noted that fishermen are included as requiring a               
business license, but then later they are exempt.                              
MS. REARDON explained that fishermen are one of the current                    
exemptions.  She also noted that they would want to exempt liquor              
sales from business, not a liquor license.                                     
SENATOR MACKIE said he wasn't opposed to a rewrite.                            
CHAIRMAN LEMAN said they could send a proposed committee substitute            
to the next committee of referral with the suggestion to work with             
Ms. Reardon on the changes.                                                    
SENATOR MACKIE moved to pass SB 329 from Committee with the                    
accompanying fiscal note with individual recommendations.  There               
were no objections and it was so ordered.                                      
                       SB 319 - ARBITRATION                                    
CHAIRMAN LEMAN announced SB 319 to be up for consideration.                    
SENATOR MACKIE moved to adopt the committee substitute.  There were            
no objections and it was so ordered.                                           
MR. JERRY BURNETT, Staff to Senator Randy Phillips, said the                   
committee substitute has changes that were recommended by the                  
Attorney General's office and reviewed them for the Committee.                 
CHAIRMAN LEMAN asked if anyone wanted to testify against this bill.            
There was no response.                                                         
SENATOR MACKIE moved to pass SB 319 from Committee with individual             
recommendations.  There were no objections and it was so ordered.              
             SB 233 - ALCOHOL BEVERAGE CONTROL BOARD                           
CHAIRMAN LEMAN announced SB 233 to be up for consideration.                    
MR. DON DAPCEVICH, Executive Director, State Advisory Board on                 
Alcoholism and Drug Abuse, said he supported extension of the                  
sunset provisions for the Alcoholic Beverage Control Board (ABC).              
CHAIRMAN LEMAN asked if he could respond to the audit concerns.                
MR. DAPCEVICH answered that Ms. Kadow would do that.                           
MS. CHARITY KADOW, President, Spenard Community Council, said that             
the ABC Board is one of their most stalwart partners in trying to              
clean up the areas in the Spenard Community Council.  Of the 480               
liquor licenses in Anchorage, 150 are within the Spenard Community             
Council boundaries and two more are to be added; they have only six            
percent of the population.  The ABC Board plays a very distinct                
function within the industry, neighborhoods, and communities.  She             
supported the extension of the ABC as a partner in economic                    
MR. DOUG GRIFFIN, Executive Director, ABC Board, said the Division             
of Legislative Audit recommended a continuation of the Board.  He              
said the Board has tried to become more active in their enforcement            
and have tried doing a little more outreach in terms of working                
with other State agencies, community councils, and local                       
governments.  The Anchorage Assembly passed a resolution supporting            
the extension, reflecting their improving working relationship with            
MR. GRIFFIN said they had some difficulties over the last year with            
staffing, because a staff person got sick in June and never came               
back to work, but had accumulated a lot of leave, so they couldn't             
afford to hire another person right away.  As a result they have               
gotten behind on getting licensing, but this does have an impact on            
businesses and they will try very hard to get the backlog taken                
care of.  Their budget does not allow them to refill that position             
right now.                                                                     
He said they have requested funding for another position of an                 
enforcement investigator for Southeast Alaska, because they don't              
have a presence in that part of the State.  Currently, they try to             
get an investigator there once a year for routine inspections, not             
to conduct investigations or to provide the level of assistance                
they would like to provide to the local police, state troopers, or             
local businesses.                                                              
He said he disagreed with the first finding from the Legislative               
Auditor, but agreed with the other two and is taking steps to                  
address those problems.                                                        
CHAIRMAN LEMAN urged him to continue to work within the                        
MR. GRIFFIN responded that since the audit came out, they have made            
a real effort to get out to communities.                                       
SENATOR HOFFMAN asked him which theater has a liquor license.  MR.             
GRIFFIN answered that the Fourth Avenue Theater had a liquor                   
SENATOR MACKIE moved to pass SB 233 from Committee with individual             
recommendations.  There were no objections and it was so ordered.              
             SB 330 - LOCATING UNDERGROUND FACILITIES                          
CHAIRMAN LEMAN announced SB 330 to be up for consideration.                    
MS. ANNETTE KREITZER, Staff to Senator Labor and Commerce                      
Committee, pointed out all the changes that had gone on in creating            
this legislation indicating a stack of papers in front of her.  In             
the process, amendments have been proposed, but not adopted.                   
She said SB 330 was introduced at the request of the Alaska                    
Telephone Association to provide an understanding of the standards             
and responsibilities for locating and excavating underground                   
facilities throughout the State for utilities and contractors.                 
She explained three amendments had been proposed.  The first one               
makes a change to 42.30.410 (g), page 3, line 9 because this                   
Section doesn't address the situation where the excavation locate              
extends for considerable distances.  The request was to put                    
something in here that would allow for a charge beyond a certain               
length (perhaps 330 ft.).  But there is no prohibition in the bill             
for charging, so that's why the amendment wasn't included in the               
An additional definition for "repair" was requested for AS                     
42.30.490, the definition section.  The problem is, if an excavator            
digs up a newly installed underground facility and splices through             
a cut cable, is the splice enough of a  repair or should the entire            
cable be replaced.  If the Committee does define repair, it should             
be to "accepted industry standards."                                           
One other concern addresses the issue of excavators exposing high              
voltage power cables and leaving them accessible to individuals                
other than qualified personnel.  The feeling among all participants            
is that there are already specific provisions in industry standards            
regarding this issue, like the National Electric Safety Code and               
other federal codes dealing with high voltage lines.                           
Number 461                                                                     
MR. JIM ROWE, Executive Director, Alaska Telephone Association,                
said over two years ago its Engineering and Planning Committee got             
together and recognized that standards are needed for locates.                 
Here he noted that nothing in this bill is directed just to                    
telephone utilities, but to all utilities.  He explained that the              
electric utility digs next to a water utility line, the telephone              
utilities are digging near the gas utilities line, etc.  He said               
there are national pressures to come up with State standards and               
this was modeled basically after the State of Washington and after             
it was brought to this Committee, the state of Minnesota.  Most                
states have locate standards.                                                  
MR. ROWE said they wanted something that would benefit the citizens            
of the State and would make utilities efficiently responsive and               
allow the same thing for whoever the contractor may be.                        
CHAIRMAN LEMAN asked if he had any reaction to the definition of               
the word "repair."                                                             
MR. ROWE responded that he agreed with Ms. Kreitzer's presentation.            
He felt the definition would be extending beyond what they are                 
doing in the bill.  The industry standard should not be raised if              
the repairs have been done according to national standards in the              
CHAIRMAN LEMAN noted that by not having a definition, by its                   
omission, a standard  has to be followed anyway.                               
MR. ROWE agreed that there are standards in effect now.                        
MR. MIKE GOLAT, Unalaska, said the bill takes positive steps                   
towards protecting the safety of the public and his utility workers            
- and his assets.  It also provides consistent guidelines for                  
locates  It raises another issue of liability and clearly                      
establishes that.  His problem with the bill is that they have                 
private utilities located on their city-owned rights-of-way and                
have always taken a cooperative approach to utility management.                
They have let other utility companies put their utilities in their             
rights-of-way free of charge and have always been able to work out             
where liability lies without having the State dictate it.  This                
creates a real lopsided situation, because they have three times as            
many utilities in their city-owned rights-of-way as ITC has and                
theirs are typically just below the surface.  If there is any                  
digging to do in repairing the road, they are the most likely                  
utility to be hit.  He understands that they have two options: one             
is to get an exclusion from this bill.  The other option is to                 
charge ITC for having their utilities in his rights-of-way, so he              
can litigate some of their exposure. Mr. Dave Goggins understands              
this and doesn't oppose it at all.                                             
The second concern he has is that the liability is not clearly                 
defined when an operator can't reasonably locate with accuracy its             
utilities (Section 42.30.410(b)).  He has a solution that wouldn't             
clearly define liability, but it would mitigate any disputes.  When            
the operator says he can't locate a utility with reasonable                    
accuracy, they should have a spotter from the utility on-site until            
the contractor locates its utility.                                            
MR. RANDY NELSON, Member, Alaska Telephone Association Engineering             
and Planning Committee, said he is currently employed by GTE Alaska            
and has been in the industry for 27 years.  He has also worked in              
other states and is here to answer questions.  This bill is of                 
mutual benefit to both excavators and owners.  All utilities find              
themselves wearing both hats.  The emphasis of a clear                         
understanding for both parties is mutually beneficial and will                 
result in a reduction of out services to all of their customers                
and, in the long run, a reduction of costs to both parties.                    
CHAIRMAN LEMAN asked if he had any reaction to Mr. Golat's comments            
on lines 15 - 19, when a utility cannot locate with reasonable                 
accuracy, they should have a spotter on-sight.                                 
MR. NELSON said he has experience with those situations and that is            
typically the best way to approach it.  People from both parties               
should be there until the utilities are found.  He didn't object to            
that.  The owner definitely wants to help locate those facilities              
to avoid damages and out-services.                                             
TAPE 98-14, SIDE B                                                             
SENATOR HOFFMAN moved a conceptual amendment providing for an on-              
site spotter.  There were no objections and it was so ordered.                 
MR. ROWE agreed that it was a good amendment.                                  
SENATOR MACKIE moved to pass CSSB 233(L&C) from Committee with                 
individual recommendations.  There were no objections and it was so            
CHAIRMAN LEMAN adjourned the meeting at 2:15 p.m.                              

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