05/08/2024 01:30 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| HB88 | |
| HB203 | |
| HB226 | |
| HB189 | |
| HB233 | |
| HB146 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 88 | TELECONFERENCED | |
| += | HB 203 | TELECONFERENCED | |
| += | HB 226 | TELECONFERENCED | |
| *+ | HB 189 | TELECONFERENCED | |
| * | HB 233 | ||
| + | HB 146 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
444ALASKA STATE LEGISLATURE
SENATE LABOR AND COMMERCE STANDING COMMITTEE
May 8, 2024
1:48 p.m.
DRAFT
MEMBERS PRESENT
Senator Jesse Bjorkman, Chair
Senator Elvi Gray-Jackson
Senator Forrest Dunbar
MEMBERS ABSENT
Senator Click Bishop, Vice Chair
Senator Kelly Merrick
OTHER LEGISLATORS PRESENT
Senator Matt Claman
COMMITTEE CALENDAR
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 88(L&C)
"An Act relating to work quotas for employees at warehouse
distribution centers; and providing for an effective date."
- HEARD & HELD
HOUSE BILL NO. 203 AM
"An Act relating to wage payments."
- HEARD & HELD
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 226(L&C)
"An Act relating to insurance; relating to pharmacy benefits
managers; relating to dispensing fees; and providing for an
effective date."
- HEARD & HELD
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 189(L&C) AM
"An Act relating to the sale of alcohol; relating to the posting
of warning signs for alcoholic beverages; and providing for an
effective date."
- HEARD & HELD
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 233(TRA) AM
"An Act relating to rates and time allowances for motor vehicle
warranty work; and relating to unfair practices by
manufacturers."
- HEARD & HELD
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 146(STA)
"An Act relating to fireworks; repealing restrictions on the
sale of fireworks; directing the Department of Public Safety to
adopt fireworks regulations; and providing for an effective
date."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 88
SHORT TITLE: WAREHOUSE WORK QUOTAS
SPONSOR(s): REPRESENTATIVE(s) RAUSCHER
02/27/23 (H) READ THE FIRST TIME - REFERRALS
02/27/23 (H) L&C, JUD
03/29/23 (H) L&C AT 3:15 PM BARNES 124
03/29/23 (H) Heard & Held
03/29/23 (H) MINUTE(L&C)
04/10/23 (H) L&C AT 3:15 PM BARNES 124
04/10/23 (H) <Bill Hearing Canceled>
04/12/23 (H) L&C AT 3:15 PM BARNES 124
04/12/23 (H) Heard & Held
04/12/23 (H) MINUTE(L&C)
04/14/23 (H) L&C AT 3:15 PM BARNES 124
04/14/23 (H) Heard & Held
04/14/23 (H) MINUTE(L&C)
04/17/23 (H) L&C AT 3:15 PM BARNES 124
04/17/23 (H) Moved CSHB 88(L&C) Out of Committee
04/17/23 (H) MINUTE(L&C)
04/19/23 (H) L&C RPT CS(L&C) 3DP 4NR
04/19/23 (H) DP: FIELDS, CARRICK, SUMNER
04/19/23 (H) NR: SADDLER, PRAX, WRIGHT, RUFFRIDGE
01/29/24 (H) JUD AT 1:00 PM GRUENBERG 120
01/29/24 (H) Heard & Held
01/29/24 (H) MINUTE(JUD)
01/31/24 (H) JUD AT 1:00 PM GRUENBERG 120
01/31/24 (H) Moved CSHB 88(L&C) Out of Committee
01/31/24 (H) MINUTE(JUD)
02/02/24 (H) JUD RPT CS(L&C) 6DP 1NR
02/02/24 (H) DP: C.JOHNSON, GRAY, CARPENTER, SUMNER,
GROH, VANCE
02/02/24 (H) NR: ALLARD
04/26/24 (H) TRANSMITTED TO (S)
04/26/24 (H) VERSION: CSHB 88(L&C)
04/29/24 (S) READ THE FIRST TIME - REFERRALS
04/29/24 (S) L&C
05/06/24 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
05/06/24 (S) Heard & Held
05/06/24 (S) MINUTE(L&C)
05/08/24 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
BILL: HB 203
SHORT TITLE: PAYMENT OF WAGES; PAYROLL CARD ACCOUNT
SPONSOR(s): REPRESENTATIVE(s) SUMNER
05/16/23 (H) READ THE FIRST TIME - REFERRALS
05/16/23 (H) L&C
01/26/24 (H) BILL REPRINTED
02/09/24 (H) L&C AT 3:15 PM BARNES 124
02/09/24 (H) -- MEETING CANCELED --
02/16/24 (H) L&C AT 3:15 PM BARNES 124
02/16/24 (H) -- MEETING CANCELED --
02/23/24 (H) L&C AT 3:15 PM BARNES 124
02/23/24 (H) Scheduled but Not Heard
02/28/24 (H) L&C AT 3:15 PM BARNES 124
02/28/24 (H) -- MEETING CANCELED --
03/01/24 (H) L&C AT 3:15 PM BARNES 124
03/01/24 (H) Scheduled but Not Heard
03/04/24 (H) L&C AT 3:15 PM BARNES 124
03/04/24 (H) Heard & Held
03/04/24 (H) MINUTE(L&C)
03/11/24 (H) L&C AT 3:15 PM BARNES 124
03/11/24 (H) Heard & Held
03/11/24 (H) MINUTE(L&C)
03/18/24 (H) L&C AT 3:15 PM BARNES 124
03/18/24 (H) -- MEETING CANCELED --
03/20/24 (H) L&C AT 3:15 PM BARNES 124
03/20/24 (H) Moved HB 203 Out of Committee
03/20/24 (H) MINUTE(L&C)
03/21/24 (H) L&C RPT 4DP 3NR
03/21/24 (H) DP: RUFFRIDGE, PRAX, SADDLER, SUMNER
03/21/24 (H) NR: FIELDS, CARRICK, WRIGHT
05/01/24 (H) TRANSMITTED TO (S)
05/01/24 (H) VERSION: HB 203 AM
05/03/24 (S) READ THE FIRST TIME - REFERRALS
05/03/24 (S) L&C
05/06/24 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
05/06/24 (S) Scheduled but Not Heard
05/08/24 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
BILL: HB 226
SHORT TITLE: PHARMACIES/PHARMACISTS/BENEFITS MANAGERS
SPONSOR(s): REPRESENTATIVE(s) SUMNER
01/16/24 (H) PREFILE RELEASED 1/8/24
01/16/24 (H) READ THE FIRST TIME - REFERRALS
01/16/24 (H) HSS, L&C, FIN
02/27/24 (H) HSS AT 3:00 PM DAVIS 106
02/27/24 (H) Heard & Held
02/27/24 (H) MINUTE(HSS)
02/29/24 (H) HSS AT 3:00 PM DAVIS 106
02/29/24 (H) Moved CSHB 226(HSS) Out of Committee
02/29/24 (H) MINUTE(HSS)
03/04/24 (H) HSS RPT CS(HSS) 6DP 1NR
03/04/24 (H) DP: SUMNER, RUFFRIDGE, MCCORMICK,
SADDLER, MINA, PRAX
03/04/24 (H) NR: FIELDS
03/06/24 (H) L&C AT 3:15 PM BARNES 124
03/06/24 (H) Scheduled but Not Heard
03/11/24 (H) L&C AT 3:15 PM BARNES 124
03/11/24 (H) Heard & Held
03/11/24 (H) MINUTE(L&C)
03/25/24 (H) L&C AT 3:15 PM BARNES 124
03/25/24 (H) Heard & Held
03/25/24 (H) MINUTE(L&C)
04/03/24 (H) L&C AT 3:15 PM BARNES 124
04/03/24 (H) <Bill Hearing Rescheduled to 04/05/24>
04/05/24 (H) L&C AT 3:15 PM BARNES 124
04/05/24 (H) -- MEETING CANCELED --
04/15/24 (H) L&C AT 3:15 PM BARNES 124
04/15/24 (H) Heard & Held
04/15/24 (H) MINUTE(L&C)
04/22/24 (H) L&C AT 3:15 PM BARNES 124
04/22/24 (H) Moved CSHB 226(L&C) Out of Committee
04/22/24 (H) MINUTE(L&C)
04/24/24 (H) L&C RPT CS(L&C) NEW TITLE 4DP 1DNP 1NR
04/24/24 (H) DP: WRIGHT, CARRICK, SADDLER, RUFFRIDGE
04/24/24 (H) DNP: PRAX
04/24/24 (H) NR: FIELDS
04/24/24 (H) FIN REFERRAL REMOVED
05/01/24 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
05/01/24 (S) <Pending Referral>
05/02/24 (H) L&C CS ADOPTED Y37 N3
05/03/24 (H) TRANSMITTED TO (S)
05/03/24 (H) VERSION: CSHB 226(L&C)
05/06/24 (S) READ THE FIRST TIME - REFERRALS
05/06/24 (S) L&C
05/08/24 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
BILL: HB 189
SHORT TITLE: SALE OF ALCOHOL BY PERSONS UNDER 21
SPONSOR(s): LABOR & COMMERCE
05/03/23 (H) READ THE FIRST TIME - REFERRALS
05/03/23 (H) L&C
03/06/24 (H) L&C AT 3:15 PM BARNES 124
03/06/24 (H) <Bill Hearing Rescheduled to 03/08/24>
03/08/24 (H) L&C AT 3:15 PM BARNES 124
03/08/24 (H) Scheduled but Not Heard
03/11/24 (H) L&C AT 3:15 PM BARNES 124
03/11/24 (H) Heard & Held
03/11/24 (H) MINUTE(L&C)
03/22/24 (H) L&C AT 3:15 PM BARNES 124
03/22/24 (H) Moved CSHB 189(L&C) Out of Committee
03/22/24 (H) MINUTE(L&C)
03/25/24 (H) L&C RPT CS(L&C) 4DP 1NR
03/25/24 (H) DP: CARRICK, PRAX, RUFFRIDGE, SUMNER
03/25/24 (H) NR: SADDLER
03/27/24 (H) FIN REFERRAL ADDED AFTER L&C
04/29/24 (H) FIN REFERRAL REMOVED
05/06/24 (H) TRANSMITTED TO (S)
05/06/24 (H) VERSION: CSHB 189(L&C) AM
05/07/24 (S) READ THE FIRST TIME - REFERRALS
05/07/24 (S) L&C, FIN
05/08/24 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
BILL: HB 233
SHORT TITLE: RATES: MOTOR VEHICLE WARRANTY WORK
SPONSOR(s): TOMASZEWSKI
01/16/24 (H) PREFILE RELEASED 1/8/24
01/16/24 (H) READ THE FIRST TIME - REFERRALS
01/16/24 (H) L&C, JUD
03/06/24 (H) L&C AT 3:15 PM BARNES 124
03/06/24 (H) Heard & Held
03/06/24 (H) MINUTE(L&C)
03/15/24 (H) L&C AT 3:15 PM BARNES 124
03/15/24 (H) -- MEETING CANCELED --
03/22/24 (H) L&C AT 3:15 PM BARNES 124
03/22/24 (H) Heard & Held
03/22/24 (H) MINUTE(L&C)
04/18/24 (H) TRA REPLACES JUD REFERRAL
04/22/24 (H) L&C AT 3:15 PM BARNES 124
04/22/24 (H) Moved HB 233 Out of Committee
04/22/24 (H) MINUTE(L&C)
04/23/24 (H) TRA AT 1:00 PM BARNES 124
04/23/24 (H) <Bill Hearing Canceled>
04/24/24 (H) L&C RPT 2DP 4NR
04/24/24 (H) DP: WRIGHT, CARRICK
04/24/24 (H) NR: FIELDS, PRAX, SADDLER, RUFFRIDGE
04/25/24 (H) TRA AT 1:00 PM BARNES 124
04/25/24 (H) Heard & Held
04/25/24 (H) MINUTE(TRA)
04/27/24 (H) TRA AT 1:00 PM BARNES 124
04/27/24 (H) Heard & Held
04/27/24 (H) MINUTE(TRA)
05/02/24 (H) TRA AT 1:00 PM BARNES 124
05/02/24 (H) Moved CSHB 233(TRA) Out of Committee
05/02/24 (H) MINUTE(TRA)
05/06/24 (H) TRA RPT CS(TRA) NEW TITLE 2DP 4NR 1AM
05/06/24 (H) DP: STUTES, MCCABE
05/06/24 (H) NR: C.JOHNSON, VANCE, MCKAY, MINA
05/06/24 (H) AM: SUMNER
05/06/24 (H) TRA CS ADOPTED Y37 N1 A2
05/06/24 (H) TRANSMITTED TO (S)
05/06/24 (H) VERSION: CSHB 233(TRA) AM
05/07/24 (S) READ THE FIRST TIME - REFERRALS
05/07/24 (S) L&C
05/08/24 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
BILL: HB 146
SHORT TITLE: REGULATION OF FIREWORKS
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR
03/29/23 (H) READ THE FIRST TIME - REFERRALS
03/29/23 (H) STA, L&C
04/13/23 (H) STA AT 3:00 PM GRUENBERG 120
04/13/23 (H) Heard & Held
04/13/23 (H) MINUTE(STA)
04/27/23 (H) STA AT 3:00 PM GRUENBERG 120
04/27/23 (H) Moved CSHB 146(STA) Out of Committee
04/27/23 (H) MINUTE(STA)
05/01/23 (H) STA RPT CS(STA) 5DP 2NR
05/01/23 (H) DP: CARPENTER, C.JOHNSON, ALLARD,
WRIGHT, SHAW
05/01/23 (H) NR: ARMSTRONG, STORY
05/08/23 (H) L&C AT 3:15 PM BARNES 124
05/08/23 (H) Heard & Held
05/08/23 (H) MINUTE(L&C)
01/24/24 (H) L&C AT 3:15 PM BARNES 124
01/24/24 (H) Moved CSHB 146(STA) Out of Committee
01/24/24 (H) MINUTE(L&C)
01/26/24 (H) L&C RPT CS(STA) 7DP
01/26/24 (H) DP: FIELDS, CARRICK, PRAX, WRIGHT,
RUFFRIDGE, SADDLER, SUMNER
03/21/24 (H) TRANSMITTED TO (S)
03/21/24 (H) VERSION: CSHB 146(STA)
03/22/24 (S) READ THE FIRST TIME - REFERRALS
03/22/24 (S) STA, L&C
04/18/24 (S) STA AT 3:30 PM BELTZ 105 (TSBldg)
04/18/24 (S) -- Public Testimony --
05/02/24 (S) STA AT 3:30 PM BELTZ 105 (TSBldg)
05/02/24 (S) Moved CSHB 146(STA) Out of Committee
05/02/24 (S) MINUTE(STA)
05/03/24 (S) STA RPT SCS 2NR 2AM NEW TITLE
05/03/24 (S) AM: KAWASAKI, WIELECHOWSKI
05/03/24 (S) NR: MERRICK, BJORKMAN
05/08/24 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
WITNESS REGISTER
RYAN MCKEE, Staff
Representative George Rauscher
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented HB 88.
CLARK BICKFORD, Staff
Representative Jesse Sumner
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented HB 203.
DAN LEWIS, Vice President of Government Affairs
Automatic Data Processing (ADP)
Roseland, New Jersey
POSITION STATEMENT: Gave invited testimony and answered
questions on HB 203.
SARENA HACKENMILLER, Staff
Representative Jesse Sumner
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Introduced HB 226.
LORI WING-HEIER, Director
Division of Insurance, Department of Commerce, Community and
Economic Development (DCCED)
Juneau, Alaska
POSITION STATEMENT: Provided comments during the hearing on HB
226.
SARENA HACKENMILLER, Staff
Representative Jesse Sumner
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Introduced HB 189 and provided a summary of
changes for SCS HB 189, version U.
JOAN WILSON, Director
Alcohol and Marijuana Control Office
Anchorage, Alaska
POSITION STATEMENT: Answered questions on the fiscal impacts of
HB 189.
DAVID MCCARTHY, Owner/Co-brewer
49th State Brewing
Northern Hospitality Group
Healy, Alaska
POSITION STATEMENT: Gave invited testimony in support of HB 189.
DIANE THOMPSON, President
Alaska Hospitality Retailers Association
Anchorage, Alaska
POSITION STATEMENT: Gave invited testimony in support of HB 189.
SARAH OATES, President
Alaska CHARR
Anchorage, Alaska
POSITION STATEMENT: Gave invited testimony in support of HB 189.
CODIE COSTELLO, President and Chief Operating Officer
Alaska Center for Performing Arts
Anchorage, Alaska
POSITION STATEMENT: Gave invited testimony in support of HB 189.
DAVID GOFF, Staff
Representative Frank Tomaszewski
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Provided an overview and explanation of
changes for HB 233.
LESTER NICHOLS, President
Alaska Auto Dealers Association
Fairbanks, Alaska
POSITION STATEMENT: Gave invited testimony on HB 233.
LISA PURINTON, Director
Records and Identification
Department of Public Safety
Anchorage, Alaska
POSITION STATEMENT: Introduced HB 146 on behalf of the sponsor,
House Rules Standing Committee by request of the Governor.
ACTION NARRATIVE
1:48:35 PM
CHAIR JESSE BJORKMAN called the Senate Labor and Commerce
Standing Committee meeting to order at 1:48 p.m. Present at the
call to order were Senators Gray-Jackson, Dunbar, and Chair
Bjorkman. Senator Claman arrived thereafter.
HB 88-WAREHOUSE WORK QUOTAS
1:49:41 PM
CHAIR BJORKMAN announced the consideration of CS FOR HOUSE BILL
NO. 88(L&C) "An Act relating to work quotas for employees at
warehouse distribution centers; and providing for an effective
date."
1:50:16 PM
RYAN MCKEE, Staff, Representative George Rauscher, Alaska State
Legislature, Juneau, Alaska, said HB 88, the Warehouse Worker
Protection Act was designed to provide transparency for
warehouse and logistic workers when they agree to a pay scale
based on a quota or production goal. HB 88 was also designed to
provide protections for workers against counterproductive
methods employers [implement, but] miss the mark on to speed up
production and save on costs.
1:50:53 PM
CHAIR BJORKMAN opened public testimony on HB 88; finding none,
he closed public testimony.
1:52:18 PM
SENATOR DUNBAR moved to adopt Amendment 1, work order 33-
LS0516\B.3, to CSHB 88 (L&C):
[Original punctuation included.}
33-LS0516\B.3
A. Radford
5/7/24
AMENDMENT 1
OFFERED IN THE SENATE BY SENATOR DUNBAR
TO: CSHB 88(L&C)
Page 1, line 9:
Delete "200"
Insert "100"
1:52:37 PM
CHAIR BJORKMAN objected for purposes of discussion.
1:52:40 PM
SENATOR DUNBAR explained that Amendment 1 (B.3) changes 200 to
100 in [HB 88 page 1,] line 9. He said HB 88 was a good bill
with good protections, and that it was his intent to have the
bill apply to more warehouses in Alaska.
1:53:29 PM
CHAIR BJORKMAN removed his objection.
1:53:38 PM
CHAIR BJORKMAN found no further objection and Amendment 1 (B.3)
was adopted.
1:54:06 PM
CHAIR BJORKMAN held HB 88, as amended in committee.
HB 203-PAYMENT OF WAGES; PAYROLL CARD ACCOUNT
1:55:15 PM
CHAIR BJORKMAN reconvened the meeting and announced the
consideration of HOUSE BILL NO. 203 am "An Act relating to wage
payments."
1:55:38 PM
CLARK BICKFORD, Staff, Representative Jesse Sumner, Alaska State
Legislature, Juneau, Alaska, read the following sponsor
statement.
[Original punctuation included.]
HB203: Payment of Wages; Payroll Card Account
Sponsor Statement
Prior to the modern era, all payroll in private sector
employment was conducted by traditional means, that is
paying employees either in actual currency or with a
paper paycheck delivered or mailed to an individual
employee on payday. With time and modern technology
advancements, many private employers and government
entities have moved to electronic deposit, or
electronic funds transfer, for paying their employees.
In Alaska, current law does not permit an employer to
select an electronic payroll deposit system unless and
until every employee specifically elects to be paid
electronically. In other words, an employer who wishes
to move the company to electronic wage payment may not
be permitted to do so. Any given employer may have
very good business reasons to switch the company's
payroll system, including, business efficiency, cost-
savings, environmental concerns about excess paper
usage, or security of wage payment transactions.
Those employers in the private sector who elect to
move to an electronic payment system should be
entitled to do so. That decision rests with the
employer, as with any of the many work-related
conditions of employment (choice of uniform; work
hours and scheduling; conduct on the job; job duties
and goals; leave time; vacation allowances; etc.
etc.). The choice for an employer to pay employees via
electronic means is no different, and should be
permitted, if the employer so chooses.
Note that nothing in the proposed legislation would
require an employer to switch to electronic payment of
wages. It would simply authorize that decision, if the
employer elects to do so. Any employer who wishes to
continue paying employees with traditional paper
paycheck methods may still do so.
Should an employee either not have a bank account or
prefer an alternative to electronic funds transfer,
that employee could elect to be paid via payroll card
instead. That payroll card would be issued under a
Visa or Mastercard partner, and would operate just
like an ATM card, now accepted in lieu of cash almost
universally. The payroll card is FDIC-insured, and
secure for the employee receiving payments in this
way.
1:58:19 PM
MR. BICKFORD explained the sectional analysis for HB 203:
[Original punctuation provided.]
HB203: Payment of Wages; Payroll Card Account
Sectional Analysis Version A.A
Section 1. This section amends AS 23.10.040(a) to
require employers to pay wages or other compensation
with lawful money of the United States or with
negotiable checks, drafts, or orders payable upon
presentation without discount by a bank or depository
inside the state.
Section 2. This section adds a new section to AS 23.10
to allow employers to pay wages by credit to a payroll
card account if the employee has voluntarily
authorized the credit or has not authorized deposit of
the employee's wages under AS 23.10.043. The section
also requires employers to notify employees of their
wage payment options, the payroll card terms and
conditions, and the fees associated with using a
payroll card account. Additionally, the section
requires payroll card accounts to provide employees
with at least one cost-free withdrawal each week or
pay period, and an unlimited cost-free mechanism to
check the payroll card account balance. Finally, the
section prohibits employers from offering payroll card
accounts that charge fees for certain activities and
requires that wages credited to payroll card accounts
be insured on a pass-through basis to the employee.
1:59:47 PM
MR. BICKFORD gave a brief history of HB 203. He said HB 203 was
referred to the House Labor and Commerce committee, where there
were no amendments. When the bill made it to the House floor, an
amendment was passed. He said the amendment [from the House
floor] compromised the whole intent of HB 203 by allowing
employees to choose instead of allowing the employer to choose
[the method of payment]. He said the sponsor's intent was to
return to the [original] intent of HB 203 in this [Senate Labor
and Commerce Standing] committee.
2:00:24 PM
CHAIR BJORKMAN summarized to clarify his understanding of HB
203. He said the bill would allow for an employer to decide how
they will pay their employees without the employees having a
choice about how they will get paid.
2:00:45 PM
MR. BICKFORD replied that a better definition of HB 203 was that
the employer would give the employee the option to be paid
either by direct deposit or by payroll card. He said, in 2024
there is an effort to get away from paper checks if an employer
would prefer not to issue them anymore, due to environmental
concerns or various other business reasons.
2:01:15 PM
CHAIR BJORKMAN clarified his question and asked whether the
employee would have protection under the law to receive a paper
check as payment moving forward.
2:01:25 PM
MR. BICKFORD affirmed that [a paper check would not be an
option] unless the employer offered that option. He described a
scenario in which one employee out of one hundred requested a
paper check, [under HB 203] the employer could limit the choice
to direct deposit or payroll card.
2:01:52 PM
SENATOR DUNBAR asked how many other states have adopted this
sort of system which shifts the rights from employee to
employer.
2:02:04 PM
MR. BICKFORD answered that it was an overwhelming number and
deferred to MR. Lewis for a more accurate answer.
2:02:29 PM
SENATOR DUNBAR reflected on the current status of HB 203. He
noted that under HB 203 the employer would be able to pay the
employee by direct deposit without the employee's consent. He
said [currently] the employee must give affirmative consent, but
if there was an amendment that said an employee had the right to
receive a paper check, HB 203 would still provide a different
position for employers. He explained that by keeping the other
language of the bill, it would follow libertarian paternalism
principles and shift the default. He said it would take more
effort [by the employee] to "opt out" but it would preserve the
number of options for the employee. He asked whether that was
the intent of the amendment from the House floor and if so,
where the amendment was inserted in HB 203.
2:03:26 PM
MR. BICKFORD said the amendment ended up in AS 23.10 and said it
would allow employers to pay wages by credit to a payroll card
account if the employee has voluntarily authorized the credit.
He said originally, HB 203 gave the employer the right to choose
whether to give [employees] the choice between direct deposit
and payroll card and with the amendment [from the house floor],
employees also have the choice of a paper check. He restated
that was what [the bill sponsors] were hoping to get away from.
MR. BICKFORD deferred to Mr. Lewis for a more eloquent
explanation.
2:04:10 PM
CHAIR BJORKMAN announced invited testifier Mr. Lewis.
2:04:23 PM
DAN LEWIS, Vice President of Government Affairs, Automatic Data
Processing (ADP), Roseland, New Jersey, said ADP was the
nation's largest provider of human capital management solutions,
and that they pay one in every six US employees. As such, he
opined, ADP is uniquely positioned to understand the importance
of supporting electronic pay and transitioning away from paper
pay. HB 203, as originally drafted and approved by the House
labor and Commerce Committee, would eliminate the requirement
that Alaska employers offer paper paychecks as a form of wage
payment. Under the HB 203, employers would offer employees
payment by direct deposit or by payroll card. He said it was
ADP's position that paying employees by direct deposit or
payroll card will benefit employers from a payroll management
and expense perspective, while also providing significant
benefits to employees. He said nothing in HB 203 would prevent
employees from continuing to receive pay by direct deposit. He
also said employers could offer paper paychecks if they so
choose. He said HB 203 would protect rights to collective
bargaining arrangements and does not impact regulations for
payment of wages to state employees.
2:05:44 PM
MR. LEWIS said there were much better alternatives to paper
paychecks. Advances in technology have improved the timeliness,
consistency and security of electronic pay. He said electronic
pay protects employers. He explained that under certain
circumstances, it can be effectively impossible for employers to
comply laws requiring the timely payment of wages if they must
offer paper paychecks. He noted employees who receive paper
checks can't get paid on payday if there are events preventing
the timely issuance of paper, such as the all-too-common weather
events in Alaska and he said electronic payments would eliminate
this concern. In addition, he said HB 203, would make payments
of wages better for employees. He explained that paper checks
can interfere with employees' financial security decisions
because they do not allow for easy and timely access to wages.
He noted that employees often take extra steps to travel to the
workplace to receive paper checks, travel to a bank to deposit
the checks and wait for the check to clear. He pointed out that
mail is slow, and employees may not receive their pay on
schedule. He noted that some employees use costly check cashing
stores and then carry their entire paycheck to cash, which is
subject to loss or theft. Further, even employees who don't
qualify for a bank account can get a payroll card from their
employer, therefore protecting underbanked or unbanked
employees.
2:07:01 PM
MR. LEWIS said that payroll cards offer employees better
consumer protection convenience because they can use the payroll
cards anywhere they would use a check, including free online
bill payment, internet shopping, and the cards can be used for
travel arrangements that require electronic payments, such as
flights, hotels and rental cars. Unlike paper checks, payroll
cards provide protections from fraud or unauthorized use. In
addition, he said the cards provide pre-associated savings
features as well as financial wellness tools. Finally, workers
cannot overdraw their payroll card accounts, so there are no
overdraft fees associated with usage. He said passing HB 203 in
its original version would enable Alaska to align with the fact
that most payments are already electronic. Virtually all
government payments are electronic, including tax refunds and
social security payments and according to the National Automated
Clearing House Association, 93 percent of American workers are
already paid by a direct deposit.
MR LEWIS concluded saying that most states already allow for
electronic pay as the only option for employees to receive
[their pay] This has been an effective means of pay in more than
30 states that permit electronic wage payments. From our
experience, employees quickly adapt to and are thankful for the
change.
2:08:24 PM
SENATOR DUNBAR asked whether employees living in the 30 states
that permit electronic wage payment are denied the option to
receive a paper check.
2:08:49 PM
MR. LEWIS affirmed that electronic means of payment only include
direct deposit or payroll card for employees in those
jurisdictions.
2:08:59 PM
SENATOR DUNBAR asked how quickly and where can the employees
convert payroll cards to cash.
2:09:12 PM
MR. LEWIS said the funds are immediately available to employees
and in general are available more quickly than checks. He said
the cards may be funded one to two days earlier than a [paper]
check would be received.
2:09:48 PM
SENATOR DUNBAR requested an explanation of ADP's interest in
[methods of payment for employees in Alaska]. He noted ADP is
not Mastercard or VISA, who are the ones who issue the payroll
cards. He asked whether ADP operated in Alaska currently and how
ADP fit in the Alaska economy.
2:10:13 PM
MR. LEWIS explained that ADP, although headquartered in New
Jersey, is a global company with global operations, paying
employees in all 50 states including Alaska. He said ADP was
very well situated to understand the expenses to employers in
handling paper paychecks. He referred to estimates through Bank
of America from several years back that the cost to employers
for paper paychecks ranged from four to $20 for each paycheck
and said paper paychecks were expensive for employers to offer.
In addition, ADP was significantly concerned with the potential
risks related to paper paychecks. He said ADP was interested in
reducing the number of paper paychecks and moving to the digital
economy which he opined would be safer for both employees and
employers. He noted that ADP took environmental concerns
seriously, and that any reduction in the use of paper was
beneficial to the environment, the economy, and the US.
2:11:38 PM
SENATOR GRAY-JACKSON expressed concern about the impact of lost
paychecks and asked whether ADP could provide statistics for the
number of checks lost and the costs related to the losses.
2:11:58 PM
MR. LEWIS said that he could not provide statistics for lost
paychecks but that was one of ADP's concerns. He noted that
paper checks delivered by FedEx or UPS and left on a porch or
patio could be stolen or lost. He said ADP took those risks
seriously and that was a big part of the reason they were
supporting the effort to move to digital electronic pay.
2:12:39 PM
SENATOR DUNBAR noted that 30 states represented a good natural
experiment and asked whether there was evidence that wage theft
by employers was either higher or lower after laws like HB 203
had been adopted.
2:13:01 PM
MR. LEWIS said he did not have statistics on wage theft but
suggested [digital methods of pay] were much safer ways of
paying and of managing funds for employees. He explained that
the funds get deposited directly into the payroll card which
would be accessible only by that employee and can't be accessed
by anybody else. He said there was not any sort of forgery that
would allow access to those funds. He suggested [digital pay]
was a much safer means of protecting the individual employees
than any paper medium available.
2:13:42 PM
SENATOR DUNBAR requested [wage theft] statistics for the next
hearing. He defined wage theft as employers illegally
underpaying employees for the hours they work. He implied that,
if wage theft is less prevalent in states [with laws like HB
203], this could be powerful evidence for the bill, though
perhaps circumstantial. He said that if there is any compelling
argument that HB 203 would make it easier to commit the crime of
wage theft, he would be disinclined to support HB 203.
2:14:28 PM
MR. BICKFORD said he would provide those statistics to the
committee.
2:14:38 PM
CHAIR BJORKMAN noted that HB 203, page 2, line 7 mentioned fees
assessed by the card issuer and that there may be additional
fees. He requested more information about those fees.
2:15:09 PM
MR. BICKFORD said fees that may apply would be Automatic Teller
Machine (ATM) fees for cash withdrawal, reload with cash [fees]
and mobile check cashing [fees]. He said it appeared the fees
would be anywhere between a dollar and seventy-five cents to
upward of five dollars and ninety-five cents. He deferred the
question to Mr. Lewis for further explanation.
2:15:37 PM
MR. LEWIS said the premise [for HB 203] was that any employee
would have free access to all the funds on their payroll card.
He said it would be like receiving a paper paycheck. The
employee would be able to go to the bank, cash the check and get
all those funds. He said it would be the same through the
payroll card. He said there would be no fees associated with
that on the payroll card issuer side. He said, in terms of
transactions, there may be other fees for using a payroll card
that are no different than any other card that an employee may
be using. He said those fees may be generated on the merchant
side. He noted service fees for using a card, as opposed to cash
and said that was not anything unique to the payroll card
itself. He described the fees as "an attendant feature" that
we're all familiar with and [a common occurrence] when we're
using debit cards and credit cards in transactions.
2:16:47 PM
CHAIR BJORKMAN held HB 203 in committee.
2:16:59 PM
At ease
HB 226-PHARMACIES/PHARMACISTS/BENEFITS MANAGERS
2:20:15 PM
CHAIR BJORKMAN reconvened the meeting and announced the
consideration of CS FOR HOUSE BILL NO. 226(L&C) "An Act relating
to insurance; relating to pharmacy benefits managers; relating
to dispensing fees; and providing for an effective date."
CHAIR BJORKMAN noted that HB 226 is the companion to SB 121,
which Senate Labor and Commerce Standing Committee heard
numerous times, including invited and public testimony.
2:21:12 PM
SARENA HACKENMILLER, Staff, Representative Jesse Sumner, Alaska
State Legislature, Juneau, Alaska, said HB 226 would protect
Alaskan patients access to the pharmacies and medications they
need. She said Pharmacy Benefits Manager (PBMs) currently lack
regulation and oversight, permitting exploitation of patients
and providers in the state of Alaska. She explained that HB 226
would focus on protecting local pharmacies and would ensure that
patients have access to affordable, convenient pharmaceutical
care by regulating the harmful practices of PBMs. She said these
practices have driven up drug costs and include anti-competitive
tactics, prescription drug price inflation and unfair fees and
restrictions imposed on pharmacy. She said HB 226 would also
require transparency and reimbursement practices and would bar
PBMs from practicing spread pricing. She concluded that HB 226
would support Alaskan patients, pharmacists and pharmacies. The
bill would make critical changes that will lead to more
affordable, accessible, and higher quality, pharmaceutical care.
2:23:00 PM
CHAIR BJORKMAN solicited a motion.
2:23:06 PM
SENATOR GRAY-JACKSON moved to adopt the Senate committee
substitute (SCS) for CSHB 226(L&C), work order 33-LS0955\H, as
the working document.
2:23:18 PM
CHAIR BJORKMAN objected for purposes of explanation.
2:23:33 PM
MS. HACKENMILLER pointed out the changes to HB 226 were removing
"fiduciary duty" and replacing it with "duty of care". She also
said there were multiple places in HB 226 where "health care
plan" was replaced by "health care policy" at the request of the
Division of Insurance. She noted that Ms. Wing-Heier of the
Division of Insurance was available to answer questions.
2:24:51 PM
LORI WING-HEIER, Director, Division of Insurance, Department of
Commerce, Community and Economic Development (DCCED), Juneau,
Alaska, said HB 226 had been hotly debated and amended in both
bodies of the legislature and covers an emotional topic. She
acknowledged uncertainty about the best way to address the issue
and highlighted the lack of regulation for PBMs nationwide. She
said there had been various state and federal attempts to
regulate them without significant progress. She noted the
primary concern raised is the lack of transparency in drug
pricing, with no clear understanding of what consumers,
insurers, or pharmacists pay. She said HB 266 tries to put
safeguards around [consumers and pharmacists] and she said, in
the amendments [to HB 266] all entities have been deleted except
for Title 21 which applies to insured plans. She noted that
approximately 15 percent of Alaskans are in an insured plan
through either the individual market or the small/large group.
Excluded entities include the Department of Administration,
Retirement and Benefits, Employee Retirement Income Security Act
(ERISA) plans, and Medicaid.
MS. WING-HEIER said HB 266 included:
• a duty of care for pharmacists toward plan sponsors,
administrators, and enrollees, ensuring accountability.
• the elimination of spread pricing, a practice which causes
pharmacists to lose money due to fluctuating drug prices.
• the elimination of "white bagging and brown bagging", which
applies to sensitive medications that are usually
administered through IV. She explained that patients often
receive and transport these medicines themselves to reduce
costs.
• consumer protection measures:
• ability to choose mail-order or brick-and-mortar
pharmacies.
• transparency in drug pricing and pharmacist payments.
MS. WING-HEIER said HB 266 was the result of the combined effort
of pharmacists, regulators, insurance companies, and other
payors in the state. She said the desired result of HB 266 was
to stabilize independent pharmacies, avoid excessive burdens on
insurers due to fluctuating pharmaceutical costs and supply, and
primarily to protect consumers by providing transparency around
payment for drugs, how drugs are acquired, and how pharmacists
are paid. She said HB 266 took a long time to develop. She said
the bill was acceptable and acknowledged that none of the
stakeholders would be getting everything they wanted, but all
would benefit in some way.
2:28:49 PM
CHAIR BJORKMAN removed his objection; found no further objection
and SCS CSHB 226 was adopted as the working document.
2:29:07 PM
CHAIR BJORKMAN [held HB 226 in Senate Labor and Commerce
Standing Committee.]
2:29:09 PM
At ease.
2:34:48 PM
Senator Claman joined the meeting.
HB 189-SALE OF ALCOHOL BY PERSONS UNDER 21
2:36:58 PM
CHAIR BJORKMAN reconvened the meeting and announced the
consideration of CS FOR HOUSE BILL NO. 189(L&C) am "An Act
relating to the sale of alcohol; relating to the posting of
warning signs for alcoholic beverages; and providing for an
effective date."
2:37:35 PM
SARENA HACKENMILLER, Staff, Representative Jesse Sumner, Alaska
State Legislature, Juneau, Alaska, paraphrased the following
sponsor statement:
[Original punctuation provided.]
HB 189: Sale of Alcohol by Persons Under 21
Sponsor Statement
HB189 would aim to change existing Alaska statutes,
that would allow employees between the ages of 18 and
20 to sell, serve, deliver, and dispense alcohol
within restaurants and other specified license and
endorsement types under appropriate supervision. This
bill also modifies hours that a theater license holder
may serve alcohol and updates alcohol warning signs
content to include warnings against certain types of
cancer.
Alaska is one of just three states that require
employees to be over the age of 21 to sell, serve,
dispense, and deliver alcohol, while 39 states allow
servers to be 18-20. HB189 would create positive
change by tackling labor shortages and a high rate of
turnover in industries affected by this bill. Now, 18-
to 20-year-olds who wish to work in these industries
will have the opportunity to move into positions that
increase their earning potential. Expanding the
potential workforce strengthens businesses, allowing
them to operate at full capacity, leading to greater
economic contributions overall.
Many establishments already implement robust training
programs to ensure responsible alcohol service
practices. These measures, combined with on-site
supervision, could effectively ensure responsible
service by young adults within these industries.
With adequate training and supervision, employees aged
18-20 can responsibly and safely handle alcohol sales
and service in a controlled restaurant environment.
This change would benefit Alaska's economy, alleviate
labor shortages, and promote fairness within our
service industry.
2:38:39 PM
CHAIR BJORKMAN solicited a motion.
2:38:42 PM
SENATOR GRAY-JACKSON moved to adopt the Senate committee
substitute (SCS) for CSHB 189, work order 33-LS0697\U, as the
working document.
2:38:55 PM
CHAIR BJORKMAN objected for purposes of discussion.
2:39:05 PM
MS. HACKENMILLER provided a summary of changes for HB 189,
version U:
• Removal of Section 11 referred to the posting of warning
signs for alcoholic beverages, which had been added on the
House floor.
• Section eight would amend AS 04.16.049(d) which listed
license holders that would be allowing 18 to 20 year olds
to serve. Version U would add seven more: brewery
manufacturer, winery manufacturer, distillery manufacturer,
brewery retailer, winery retailer and distillery retailer
and limited brewed beverage and wine wholesalers.
• Section nine would add a beverage dispensary, or beverage
dispensary tourism licensee that has a large resort
endorsement [to license holders that would be allowing 18
to 20 year olds to serve]. She said Section nine would also
give some age requirements for under 16 and over 16,
ensuring that a legal guardian consents to [a 16 - 20 year-
old's] access to the premises.
2:40:31 PM
At ease
2:41:10 PM
SENATOR DUNBAR asked for clarification regarding the substantive
cancer warnings that had been added to HB 189 on the House
floor. He asked whether the cancer warnings were removed in
[version U].
2:41:25 PM
MS. HACKENMILLER replied that the cancer warning had been
removed in the [SCS].
2:41:34 PM
SENATOR DUNBAR asked whether there were technical changes [to HB
189] other than the removal of cancer warnings. He asked whether
there would be other changes necessary for HB 189 if the cancer
warning were restored.
2:42:07 PM
MS. HACKENMILLER said the most substantive technical change to
HB 189 would be a change to the title. She said the alcohol
warning signs would be included in the title [of HB 189].
2:42:24 PM
CHAIR BJORKMAN asked for clarification about whether there was a
relationship between a fiscal note for HB 189 and the [alcohol]
warning signs.
2:42:36 PM
MS. HACKENMILLER said there were conflicting messages. She had
been informed that the fiscal note had been removed but had not
been able to confirm that with the Alcohol and Marijuana Control
Office (AMCO).
2:43:08 PM
CHAIR BJORKMAN asked Ms. Wilson whether there was a relationship
between a fiscal note for HB 189 and the [alcohol] warning
signs.
2:43:24 PM
JOAN WILSON, Director, Alcohol and Marijuana Control Office,
Anchorage, Alaska, said there would be no fiscal note required
as long as only one sign was changed. She said there had been a
fiscal note attached to another bill which specified changes to
two signs and that would have required a fiscal note, but [the
cost for] one sign would not.
2:43:55 PM
CHAIR BJORKMAN sought to clarify that if the amendment [to HB
189] that had been made on the House floor [to require warning
signs] were reinstated, AMCO would be able to implement the
signage with its current resources.
2:44:29 PM
MS. WILSON said that was correct.
2:44:39 PM
CHAIR BJORKMAN proposed that HB 189 be considered by the
committee the next day after changes could be made to the [SCS].
2:45:16 PM
SENATOR DUNBAR clarified that the [SCS] for HB 189 had not been
adopted by the committee yet and he could not support adopting
it with the cancer warning signs amendment removed from the
bill.
2:46:29 PM
SENATOR GRAY-JACKSON asked Ms. Wilson for clarification. She
recalled that HB 189 originally included alcohol warning signs.
She said she understood that there would be no cost if there
were no warning signs [required by HB 189].
2:46:54 PM
MS. WILSON responded that there was a separate bill specific to
warning signs that carried a $25,000 fiscal note. She said that
[fiscal note] was necessary for that bill because it would have
changed two signs. She said HB 189 would only require an
amendment to one [warning] sign and that cost could be borne
within AMCO's internal budget. She acknowledged recent
discussion about whether a fiscal note would be attached [to HB
189] and assured the committee there would not be.
2:47:35 PM
SENATOR GRAY-JACKSON specified that the SCS for HB 189, version
U, no longer has the cancer warning, and asked if it would
require a fiscal note if the cancer warnings were in the bill.
2:47:52 PM
MS. WILSON responded that with or without the cancer warning,
there would be no fiscal note [for HB 189].
2:48:05 PM
At ease.
2:52:57 PM
CHAIR BJORKMAN reconvened the meeting and maintained his
objection to the adoption of SCS for HB 189, work order 33-
LS0697\U.
2:53:15 PM
CHAIR BJORKMAN opened [invited] testimony on HB 189.
2:53:30 PM
DAVID MCCARTHY, Owner/Co-brewer, 49th State Brewing, Northern
Hospitality Group, Healy, Alaska, said HB 189 would help to
build stronger community and that it was part of the solution to
the labor shortage in Alaska. He sought to debunk the idea that
HB 189 would be dangerous and said if it was dangerous, there
would be a national debate. Instead, the rest of the nation has
already adopted [HB 189] with the exception of three states. He
said [his business], was currently licensed, staff was trained
and no one under 21, guests nor staff, were permitted to consume
alcohol on the premises. He said Training for Alcohol
Professionals (TAP) was required for all employees of all ages
and HB 189 would strengthen the community by requiring alcohol
consumption education for young adults who have not been legally
allowed to consume alcohol, those between the ages of 18 and 20.
He noted [some] states have already allowed staff of 18 and over
[to serve alcohol] and there is currently debate about lowering
that age to 16. He suggested that Alaska could follow the course
already set by 47 states, learning from their experience.
MR. MCCARTHY said the International Youth Foundation reported
that creating opportunities for youth and young adults in
hospitality [industry] should be something that all states focus
on. He said youth critically need life and employable skills to
prepare themselves to be motivated and confident decision-makers
who can overcome adversity and realize their potential. He said
that in developed economies we see 100% enrollment in secondary
school, yet nearly one in five of these students do not acquire
the minimum level of basic skills to function well in our
society.
MR. MCCARTHY said hospitality is a noble career path and service
to others is important to build healthy and sustainable
communities. Restaurants create a sense of place in our
communities, and we've all learned a very tough lesson during
the years of COVID, when restaurants were forced to be closed.
He said passing HB 189 is part of the solution. He noted that
one in every three Americans receive their first jobs in
restaurants and food service industry and millions of those
people will go on to have rewarding lifelong careers. He said
passing HB 189 would allow hospitality to infuse in our young
adult's self-confidence, ability to manage emotion, personal
responsibility, respecting self and others, cooperating in
teamwork, creative thinking, decision making, and one of the
most important is conflict management.
2:57:17 PM
MR. MCCARTHY said [the hospitality] industry shatters the
diversity and inclusion numbers compared to all other
industries, employing more than 54 percent women. He said
40percent of those are non-white employees. The gender pay gap
for entry level employees is also six percent higher than the
national average in our industry. He said HD 189 would be good
for young adults between 18 and 20 because it would allow them
to meet new people and make new friends. He said they would
broaden their skill set. HB 189 would allow flexibility in
shifts, fun and social jobs, and would make more hours available
during holiday breaks, especially to those that are going to
school. He noted HB 189 would also allow increased earnings
based on receiving tips.
2:58:07 PM
MR. MCCARTHY emphasized that Alaska was one of only three states
in the nation that had not adopted these changes. He said it was
critical in [the hospitality] industry and for Alaska to adopt
HB 189 to build a brighter future for our communities and our
youth and our state. He said it is also important to note that
Alaska is one of only eight states that is not a tip credit
state. In most states, they allow people to be paid less than
minimum wage. HB 189 would allow young adults to be paid minimum
wage, plus tips [thereby] increasing wages, which increases
independence.
MR. MCCARTHY said, overall, allowing HB 189 to be approved would
not only help with immediate labor needs, it would impact our
communities through hospitality employment of young adults in
development of the future leaders that we desperately need.
2:59:24 PM
DIANE THOMPSON, President, Alaska Hospitality Retailers
Association, Anchorage, Alaska, said, he agreed with everything
in the previous testimony and said, if passed, HB 189 would be a
big win for Alaska restaurants, hotels, lodges, breweries, the
Alaska Railroad, convention centers, etc.; and a big win for 18-
to 20-year-old young adults by giving them a chance to earn a
decent wage. Right now, she said, in Alaska, when college kids
come home, all we can offer them is the job of bussing or
hosting. The pay is okay, but it's not like it would be if they
were able to serve, especially serve alcohol. With summer and
tourist season approaching, really fast, she respectfully asked
the committee to vote yes on HB 189.
3:01:00 PM
SARAH OATES, President, Alaska Cabaret Hotel Restaurant and
Retailers Association, (Alaska CHARR), Anchorage, Alaska, said
she served as president and CEO of Alaska CHARR, since 2018. She
said Alaska CHARR was based out of Anchorage and had over 700
members across Alaska communities and represented over 2,000
hospitality establishments employing over 30,000 workers around
the state. With the pandemic past its peak, Alaska's hospitality
industry continues to face significant ongoing challenges to
business operations, the greatest of which being ongoing and
increasing labor shortages. She noted that Alaska was one of
only three states, along with Utah and Nevada, that required a
person to be 21 years of age or older to serve alcohol. She said
employers struggle to promote or retain quality employees who
are 18 to 20 years of age because they are prohibited from
serving alcohol or supervising other employees who serve or sell
alcohol. She said Alaska employers are not competitive in this
space, and the hospitality industry is experiencing an out-
migration of young workers. She said that when she was in her
late teens and early twenties, she attended college while
serving and bartending in the Pacific Northwest. During the
summer break, she stayed in the Pacific Northwest rather than
returning home to Alaska, because she could make significantly
more money as a server or manager, positions that she was
prohibited by law from working in in her home state. She
reported that, in multiple years, she brought home six figures
by serving and bartending as a young adult outside Alaska. She
said, if she had returned to Alaska during those years, she
would have been limited under current statute, to positions that
paid 25 to 30 percent at the time, what she was able to make
outside. She said many young people are making the same choice.
Today's labor market is having a significant impact on Alaska
hospitality businesses. HB 189 would help hundreds of Alaskan-
owned establishments around the state that collectively
represent Alaska's largest private employer and second largest
industry. She said, as the voice of Alaska's hospitality
industry, she respectfully requested the committee to support
thousands of workers and businesses around the state by voting
in support of HB 189.
3:03:33 PM
CODIE COSTELLO, President and Chief Operating Officer, Alaska
Center for Performing Arts (ACPA), Anchorage, Alaska, said she
was the president and Chief operating officer of Alaska Center
for the Performing Arts and also the General Manager of Broadway
Alaska. She said the ACPA had been operating for over 35 years
and partnered with presenters and producers from Alaska and
around the world to provide world class arts experiences to the
community, including those from eight resident companies. She
said this season [2023/2024], the ACPA launched Broadway Alaska,
a multiyear partnership with the Nederlander Organization. She
spoke about the success of Broadway Alaska's first season and
the enthusiastic attendance by people from across the state and
all over the country. She noted that many other events were
hosted at the performing arts center each year and PAC
understood the importance of its role as an economic engine for
downtown Anchorage and Alaska. She described the upcoming
2024/2025 season at the ACPA and said HB 189 would allow them to
continue this work, expanding ACPA's local business operations
and revenue while enhancing the theater experience for their
patrons.
3:04:57 PM
MS. COSTELLO said under ACPA's current alcohol license, workers
were limited. Patrons could only consume alcohol in the upper-
level lobbies and within limited time frames, and there was no
alcohol allowed in theater. She said HB 189 would provide an
updated framework for the rules of ACPA's license, giving them
flexibility to finally be able to respond to presenters',
promoters' and patrons' requests for evolving the experience at
the ACPA and keeping [up] with industry trends. In this spirit,
ACPA recommends and requests that this license change to
accommodate our clients and patrons and ensure their experience
at the theater is relaxed and responsible, and our venue and
services reflect the type of experience our patrons seek and
that ACPA can support and promote. She explained that,
currently, if a patron purchased a drink during a 15 to 20
minute intermission, they would have to procure a drink and be
back in their seats within minutes. The system was rushed
unnecessarily and led to a harried atmosphere and product waste.
She said ACPA had an existing and robust operations plan for all
events at the center with a well-trained event staff, staffed
and contracted security, and contracted concessionaires. She
said and this would include great support from the expansion of
the workforce opportunities that everyone testifying today has
been talking about. She said ACPA is poised to scale up and
adjust their operations as needed to ensure their continued and
successful operations with the passing of HB 189 and the removal
of existing restrictions in their current license type.
3:06:24 PM
MS. COSTELLO concluded that HB 189 would increase ACPA's
economic impact on and for downtown Anchorage and Alaska. She
said HB 189 would drive increased operating revenue which would
help them reinvest in facility and personnel. It would keep the
theater license in line with national standards and increase the
quality of patron experience. She said it would be a win for
local businesses, the arts industry and the lively downtown
experience that we all help to curate in Anchorage. She thanked
Representative Sumner and his staff, Clark and Serena, for their
work on the bill and their contribution to the vibrancy and
economy of downtown Anchorage.
3:07:36 PM
CHAIR BJORKMAN asked Director Wilson whether a separate
effective date [amendment to HB 189] to accommodate the warning
signs would be helpful.
3:08:03 PM
MS. WILSON replied that an effective date of July 1, 2024, would
be helpful and she acknowledged that HB 189 overall would carry
an immediate effective date.
3:08:36 PM
MS. HACKENMILLER made closing comments on HB 189. She shared
about her late father's work for CHARR and said he would be
happy to see Alaska aligning with other states in allowing young
folks to work in the service industry as they deserve, and to
see labor shortages possibly get worked on.
[Objection to the adoption SCS for CSHB 189 was maintained.]
3:09:23 PM
CHAIR BJORKMAN held HB 189 in committee.
3:09:29 PM
At ease
HB 233-RATES: MOTOR VEHICLE WARRANTY WORK
3:10:16 PM
CHAIR BJORKMAN reconvened the meeting and announced the
consideration of CS FOR HOUSE BILL NO. 233(TRA) am "An Act
relating to rates and time allowances for motor vehicle warranty
work; and relating to unfair practices by manufacturers."
3:10:55 PM
DAVID GOFF, Staff, Representative Frank Tomaszewski, Alaska
State Legislature, Juneau, Alaska, gave a brief overview of
changes to HB 233 by the House:
• Clarification that the guides for [repair] times were
independent time guides, not the manufacturer [prescribed]
time guides.
• Provision for dealers to be protected from penalties for
doing manufacturers' warranty work. He said HB 233, section
four prohibited surcharges to recoup costs for warranty
work, similar to protections provided in 22 other states.
• Change in wording to allow [charging for] fractions of
hours and not just [full or whole] hours.
3:13:15 PM
CHAIR BJORKMAN announced invited testimony for HB 233.
3:13:45 PM
LESTER NICHOLS, President, Alaska Auto Dealers Association,
Fairbanks, Alaska, introduced himself and referred to an
economic impact study of an Illinois law [similar to HB 233]
that went into effect January 1, 2022. The report was titled
"Improving the Motor Vehicle Franchise Act" [by the Illinois
Economics Policy Institute and the Illinois Project for Middle
Class Renewal]. He read from the report's Executive Summary:
[Original punctuation provided.]
By bringing pay for warranty work up to competitive
local area standards, the Multiplier Act has generated
positive economic impacts in Illinois. The Act:
• Boosts worker earnings at Illinois' auto dealers by
between three percent and seven percent relative to
similar workers, resulting in $143 million annually
for skilled mechanics in middle-class jobs that
cannot be outsourced.
• Reduces employee turnover at Illinois' auto dealers
by nine percent, helping to combat labor shortages.
• Increases hours worked per week at auto dealers by
as much as six percent compared to other private
industry workers in Illinois.
• Grows the state's economy by $302 million, a $2.11
economic multiplier per dollar in wage gains.
• Generates $21 million in state tax revenues and $21
million in local tax revenues every year.
• Promotes safety and reliability by ensuring that
skilled mechanics can devote the proper time needed
to correctly diagnose and fix vehicle problems.
3:14:41 PM
MR. NICHOLS highlighted several points from the summary,
including that all auto dealer employees received pay increases
of three to seven percent and skilled mechanics received $143
million annually. He emphasized that employee turnover [in
Illinois] was reduced by nine percent and pointed out that HB
233 is meant to combat labor shortages [in Alaska], pay
mechanics better and hang on to mechanics [already employed]. He
also highlighted the growth in the [Illinois] state economy and
that safety and reliability were improved by correctly
diagnosing and fixing vehicle problems. He stated this was in
the best interests of everybody: consumers, manufacturers,
mechanics and [auto dealership] business owners.
3:16:05 PM
MR. NICHOLS mentioned opposition to HB 233 which pointed out
that chart eight on page eight of the report, "Improving the
Motor Vehicle Franchise Act in Illinois" notes a wage increase
of only 2.9 percent. He said the opposition pointed out that the
increase in wages was less than the rate of inflation in the
area. He contested that characterization by quoting the study,
reading from the paragraph preceding figure eight, page eight:
[Original punctuation provided.]
A 2.9 percent net increase in monthly earnings
translates into a $180 gain ($2,166 per year) for the
46,212 employees who were already employed at car
dealerships prior to the law, or $100.1 million
annually. Moreover, higher earnings attracting and
retaining 1.2 percent more employees relative to
neighboring states means that an additional 543
workers were directly employed due to the law. At the
average monthly earnings of $6,549 (or annual earnings
of $78,588), these workers account for another $42.7
million in labor income. Adding the earnings effect
and the employment effect together produce a $142.7
million total boost to employees at auto dealerships
in Illinois in the first year of the law (Figure 8).
3:17:39 PM
MR. NICHOLS continued to read from the report, "Improving the
Motor Vehicle Franchise Act in Illinois', page eight, final
paragraph to support the expectation that HB 233 will
significantly improve wages and opportunities, directly and
indirectly related to auto dealerships in Alaska:
[Original punctuation provided.]
The $142.7 million expansion of mechanics' pay creates
more than 1,500 jobs across Illinois, including the
543 jobs directly at car dealerships themselves
(Figure 9). Over 200 indirect jobs are created
throughout the supply chain as auto dealers are
reimbursed the correct amount for work performed,
their bottom lines are improved, and they can make
additional purchases for their establishments.
Finally, nearly 800 jobs are created as the skilled
auto mechanics and techniciansand indirectly employed
workers as well have more money to spend at local
stores, restaurants, and other small businesses.
3:18:14 PM
MR. NICHOLS read from the report, "Improving the Motor Vehicle
Franchise Act in Illinois", page nine:
[Original punctuation provided.]
ADDITIONAL IMPLICATIONS OF THE LAW
The Multiplier Act ended the practice of underpaying
certified mechanics and technicians for completing
warranty repairs. By promoting equal pay for equal
work, the law reduced employee turnover at car
dealerships and helped combat labor shortages. Instead
of being expected to earn below-market rates for tasks
completed at unrealistic time allotments mandated by
out-of-state and foreign corporations, skilled
mechanics can now devote the proper time to correctly
diagnose vehicle problems to meet reliability
standards and repair manufacturing defects that are
the fault of the automakers. This improvement in
safety for drivers has occurred at no cost to Illinois
consumers, with warranty work remaining free to car
owners (McMahon, Alfirevich, & Marquardt, 2023).
3:19:05 PM
MR. NICHOLS countered the arguments of auto manufacturers
against HB 233 that the bill would not really change anything
except to line the pockets of [auto dealership] businesses,
charging that the manufacturers would prefer to line their own
pockets. He said the [manufacturers'] comments that HB 233 would
raise prices [for warranty repairs] were a threat. He noted that
the manufacturers' response to changes in franchise law in 22
states was to introduce surcharges. He said the surcharges were
not a punishment to the dealers as much as to the entire state
economy, to consumers and to everybody.
3:20:28 PM
CHAIR BJORKMAN expressed appreciation for the testimony and the
committee's support for HB 233.
3:21:00 PM
MR. GOFF highlighted that, according to Mr. Nichols' testimony,
$14-15 million additional revenue would come into the state
through the pockets of auto dealership [mechanics and other]
employees as a result of HB 233 and that would be a great
benefit to the state. He advocated for the potential of HB 233
to keep mechanics in dealerships in Alaska and keep the
dealerships businesses healthy.
3:21:36 PM
CHAIR BJORKMAN held HB 233 in committee.
3:21:42 PM
At ease
HB 146-REGULATION OF FIREWORKS
[Before the committee for consideration is SCS CSHB 146(STA).]
3:21:58 PM
CHAIR BJORKMAN reconvened the meeting and announced the
consideration of CS FOR HOUSE BILL NO. 146(STA) "An Act relating
to fireworks; directing the Department of Public Safety to adopt
fireworks regulations; and providing for an effective date."
3:22:27 PM
LISA PURINTON, Director, Records and Identification, Department
of Public Safety, Anchorage, Alaska, stated she is also the
department's legislative liaison. She said HB 146 would
modernize statutory restrictions on consumer fireworks to comply
with current federal requirements and industry standards. HB 146
would protect the public, remove compliance barriers for
businesses, and improve enforcement by the State Fire Marshal's
Office. She said the changes in HB 146 would set minimum
standards for the sales, storage, distribution, and use of
fireworks, addressing the outdated nature of current statutes.
3:23:26 PM
MS. PURINTON noted that the current statutes, AS 18.72, adopted
in 1972, were severely outdated, and did not comply with federal
standards and industry best practices. She said the public was
at risk because the statutes did not meet the standards set by
the US Consumer Product Safety Commission, the American
Pyrotechnics Association, the US Department of Transportation,
the Bureau of Alcohol, Tobacco, Firearms and Explosives and
Title 49 of the code of federal regulations. She noted that the
current outdated statutes included only 12 different definitions
for consumer fireworks and there were currently 11 categories
and well over 40 definitions [for consumer fireworks].
3:24:46 PM
MS. PURINTON summarized that HB 146's intent was to modernize
the statutes to reflect current industry and federal standards,
ensuring public safety and compliance. She noted changes to HB
146 as it moved through the House and the Senate:
• The House version of the bill included a minor change,
modifying "any" to "a" in a section related to buildings
entered by the State Fire Marshal.
• The Senate version included a committee substitute that:
• significantly altered the scope of HB 146 to provide a
stronger statutory foundation for the changes,
ensuring compliance with federal and industry
standards, and
• modified several repealed statutes to make HB 146 more
workable and flexible for future regulatory updates.
3:26:58 PM
CHAIR BJORKMAN held HB 146 in committee.
3:27:35 PM
There being no further business to come before the committee,
Chair Bjorkman adjourned the Senate Labor and Commerce Standing
Committee meeting at 3:27 p.m.