Legislature(1995 - 1996)
04/18/1996 02:20 PM Senate L&C
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
SENATE LABOR AND COMMERCE COMMITTEE
April 18, 1996
2:20 P.M.
MEMBERS PRESENT
Senator Tim Kelly, Chairman
Senator John Torgerson, Vice Chairman
Senator Mike Miller
Senator Jim Duncan
Senator Judy Salo
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
CS FOR HOUSE BILL NO. 284(FIN)
"An Act relating to the Alaska Commercial Fishing and Agriculture
Bank."
CS FOR HOUSE BILL NO. 405(STA) am
"An Act relating to the Board of Examiners in Optometry; relating
to licensure of dispensing opticians; and providing for an
effective date."
HOUSE BILL NO. 432
"An Act relating to the practice of veterinary medicine."
HOUSE BILL NO. 497
"An Act relating to chiropractic peer review; and providing for an
effective date."
CS FOR HOUSE BILL NO. 457(STA)
"An Act relating to the unlicensed practice of certain occupations
for which licenses are required."
CS FOR HOUSE BILL NO. 428(FIN) am
"An Act relating to the authority of the Department of Corrections
to contract for facilities for the confinement and care of
prisoners, and annulling a regulation of the Department of
Corrections that limits the purposes for which an agreement with a
private agency may be entered into; and giving notice of and
approving a lease-purchase agreement for the design, construction,
and operation of a correctional facility, and setting conditions
and limitations on the facility's design, construction, and
operation."
PREVIOUS SENATE COMMITTEE ACTION
HB 284 - See Labor and Commerce minutes dated 4/11/96.
HB 405 - No previous action to consider.
HB 432 - No pervious action to consider.
HB 497 - No previous action to consider.
HB 457 - No previous action to consider.
HB 428 - No previous action to consider.
WITNESS REGISTER
Ed Crane, CEO
Commercial Fishing and Agriculture BankCFAB
2550 Denali
Anchorage, AK
POSITION STATEMENT: Supported HB 284.
Roger Poppe, Staff
Representative Pete Kott
State Capitol Bldg.
Juneau, AK 99801-1182
POSITION STATEMENT: Staff to sponsor of HB 405.
Catherine Reardon, Director
Division of Occupational Licensing
Department of Commerce and Economic Development
P.O. Box 110806
Juneau, AK 99811-0806
POSITION STATEMENT: Supported HB 405 and HB 457.
Randy Welker, Legislative Auditor
P.O. Box 113300
Juneau, AK 99811-3300
POSITION STATEMENT: Supported HB 405 and HB 457.
Larry Harper
534 W 2nd
Anchorage, AK 99501
POSITION STATEMENT: Opposed HB 405.
Tim Sullivan, Staff
Representative Eldon Mulder
State Capitol Bldg.
Juneau, AK 99801-1182
POSITION STATEMENT: Staff to sponsor of HB 497.
Dennis Dewitt, Staff
Representative Eldon Mulder
State Capitol Bldg.
Juneau, AK 99801-1182
POSITION STATEMENT: Staff to sponsor of HB 428.
Bob Cole, Director
Division of Administrative Services
Department of Corrections
P.O. Box 112000
Juneau, AK 99811-2000
POSITION STATEMENT: Opposed HB 428.
Chuck O'Connell, Business Manager
Alaska State Employee's Association
AFSVME Local 52
3510 Spenard Rd., #201
Anchorage, AK 99503
POSITION STATEMENT: Opposed HB 428.
ACTION NARRATIVE
TAPE 96-28, SIDE A
Number 001
HB 284 AK COMMERCIAL FISHING & AGRICULTURE BANK
CHAIRMAN KELLY called the Senate Labor and Commerce Committee
meeting to order at 2:20 p.m. and announced HB 284 to be up for
consideration.
ED CRANE, CEO, Commercial Fishing and Agriculture Bank, said that
HB 284 recognizes changes which have taken place in the economics
of fishing since CFAB was created 18 years ago. It also deals with
some voids and inconsistencies in the original statute as it
relates to laws relating to creditors. It deals with an anomaly
that appears in existing statute which provides for CFAB's
liquidation should CFAB not retire all the State's capital, but on
the other hand in another part of an existing statute it says that
when CFAB does retire all of the State's capital the statute lapses
which means there is no more CFAB.
MR. CRANE stressed that the reason for the 18 pages is because the
statute spells out in extreme detail how CFAB should operate so
there is very specific language.
SENATOR KELLY said Division of Banking and Securities had some
concerns with this bill, but no real problems. They will continue
to audit CFAB on an annual basis.
SENATOR TORGERSON moved to pass CSHB 284 from committee with
individual recommendations. There were no objections and it was so
ordered.
HB 405 BD OF OPTOMETRISTS; OPTICIANS
SENATOR KELLY announced HB 405 to be up for consideration.
ROGER POPPE, Staff to Representative Kott, sponsor, said HB 405
extended the Board to 2002, clears up a conflict between
optometrists and opticians, both of whom have assistants who assist
them in dispensing glasses and contact lenses. It's been the
opticians position that any dispensing would have to come under
their jurisdiction. So optician apprentices would have to be
qualified to this and that would include all assistants who are
working for optometrists and ophthalmologists. After much debate
a decision was made in favor of the optometrists. So people who
work for opthomologist or optometrists do not have to have their
assistants be licensed as optical assistants or optician
apprentices.
He explained that section 4 was a housekeeping provision. Section
5 eliminates statutory references one of which is the requirement
to have branch offices for the Board - no longer necessary in
Alaska. In addition there are some requirements that opticians
have to meet certain visual and health requirements. They are the
only Board that had this requirement so there was some concern that
this wasn't constitutional and might involve litigation under the
Americans With Disabilities Act. So the advice of Legislative
Budget and Audit was to eliminate the reference.
CATHERINE REARDON, Division of Occupational Licensing, supported HB
405.
RANDY WELKER, Legislative Auditor, said HB 405 addressed all their
audit's concerns.
LARRY HARPER, licensed optician, said he is currently serving on
the Board of Directors of the National Contact Lens Examiners which
is the nationally certified testing agency for contact lens
fitters. He said in the 1980 sunset review the legislature
intentionally removed the exemption that existed at that time for
optometrists and their employees. The reason then, as now, is if
opticians are licensed, they should be licensed regardless of where
they are employed.
People in the State of Alaska have a right to expect that opticians
are licensed regardless of where the purchase is made. They have
been licensed for 23 years and there is no reasonable way to
determine whether a person is qualified to perform their duties
except by licensure. Giving optometry this exemption effectively
creates a two tier level of competence within the field adding to
consumer confusion.
There is no way for an optometrist or a physician to adequately
supervise all that goes on in their office. In addition it would
create an unfair competitive advantage for optometrists and shows
a blatant disregard for the Alaskan public.
SENATOR KELLY said they would set HB 405 aside while the connection
with Fairbanks was reestablished.
HB 432 VETERINARY LICENSING
SENATOR KELLY announced HB 432 to be up for consideration.
MR. POPPE, Staff of Representative Kott, sponsor, explained that
this bill was introduced at the request of some veterinarians. The
Board of Veterinary Medicine supports it. It changes the name of
the Board to the National Board of Examination Committee. Section
2 also makes it an unclassified misdemeanor to falsely claim to
have a veterinary license and to practice without a license.
Currently there are no penalties in place for doing this. An
unclassified misdemeanor would be up to one year in jail and a
$10,000 fine. So this would plug a loophole.
Section 7 slightly modified the definition of the practice of
veterinary medicine to include false presentation of being a
veterinarian.
Section 1 allows veterinary technicians to practice and section 5
sets up a procedure for them to be licensed by the Board.
Currently they are only registered, not licensed.
MS. REARDON said they support the bill as does the Board of
Veterinarians.
SENATOR MILLER said he wanted to make sure this bill was not aimed
at someone who wanted to take care of his dog. MS. REARDON
directed their attention to page 3 which says practicing "for
compensation."
SENATOR TORGERSON asked what was the impact of licensing
technicians and what is their job. MS. REARDON replied that they
have already been licensing veterinary technicians. This would
basically give them the title of licensed veterinary technicians.
This isn't a new intrusion into unregulated activities.
SENATOR TORGERSON asked if there were fees associated with
licensing and registration. MS. REARDON answered that she believed
so. She added that often professions preferred to be able to be
called "licensed."
SENATOR TORGERSON asked how many there were. MS. REARDON said she
was sorry, but she didn't know the answer.
SENATOR TORGERSON moved to pass HB 432 from committee with
individual recommendations. There were no objections and it was so
ordered.
HB 497 CHIROPRACTIC PEER REVIEW
SENATOR KELLY announced HB 497 to be up for consideration.
TIM SULLIVAN, Staff to sponsor, Representative Eldon Mulder,
testified that the Chiropractic Peer Review Committee consists of
three chiropractors and one lay person. Under current statute only
the chiropractors on the committee have immunity for decisions they
make as committee members, not the lay person. This bill gives all
members immunity.
Section two of the bill provides that patient records are
confidential to the peer review process if they were confidential
before being submitted to the committee.
SENATOR TORGERSON moved to pass HB 497 from committee with
individual recommendations. There were no objections and it was so
ordered.
HB 457 UNLICENSED PRACTICE OF OCCUPATION
SENATOR KELLY announced HB 457 to be up for consideration.
MR. WELKER explained that this bill gives the Division of
Occupational Licensing the authority to assess civil fines for
practicing an occupation without a license. Presently, only the
Board of Architects, Engineers, and Land Surveyors has that
authority. The only recourse for others is through the courts.
This would be an efficient tool for the investigative section of
the Division, although they don't anticipate having to use it
often.
MS. REARDON said she supported the bill.
SENATOR TORGERSON moved to pass HB 457 from committee with
individual recommendations. There were no objections and it was so
ordered.
SENATOR KELLY announced HB 405 to be up for consideration once
more.
MR. HARPER, testifying from Fairbanks, said the two people who were
going to testify from Fairbanks, James Rothmeyer and Pam Gajdos,
are associates of his and were going to testify along the same
lines as he did.
SENATOR TORGERSON moved to pass HB 405 from committee with
individual recommendations. There were no objections and it was so
ordered.
HB 428 LEASE-PURCHASE CORRECTIONAL FACILITY
SENATOR KELLY announced HB 428 to be up for consideration, but sai
they would take a break at 2:45 p.m.
SENATOR KELLY called the meeting back to order at 3:12 p.m.
DENNIS DEWITT, Staff to Representative Eldon Mulder, said HB 428
allows the Department of Corrections to pursue the use of private
facilities. The first portion of the bill clarifies the ability to
contract for private services. The second portion of the bill
allows the Department to enter into a lease purchase agreement with
a private contractor for a private facility in Alaska.
There are some parameters like it can't be larger than 1,000 beds,
should be designed for expansion, should include housing for female
prisoners which is one of the critical needs we have in Alaska and
that construction costs should not exceed $100 million. It should
be constructed with a project labor agreement. There's language in
the bill that encourages the Department of General Services to
develop incentives in the bid process for bidders who promise to
employ Alaskans in the operation of the facility.
The bill requires that correctional officers in this facility be
trained at the same level as correctional officers in the
facilities operated by the State of Alaska.
MR. DEWITT said that we do need additional capacity in Alaska.
Today we're at about 107 percent of capacity in our facilities. We
also have 206 prisoners in Arizona and we're spending nearly $6
million providing jobs for Arizonans.
Improving facilities for female offenders is one of the things
that's outlined in the Cleary final settlement agreement and it's
an issue that it has been agreed to by almost everyone involved in
the prison system.
Number 400
The Subcommittee on Corrections held interim hearings on the topic
of privatization and found that the ability to move quickly is
enhanced using private sector facilities and the record of private
facilities is as good as public facilities in terms of safety and
quality of the product that they offer.
The cost in Arizona per inmate day is $59 with additional costs
bringing it up to $73 per day. In Alaska we pay $109 per day. He
believes that a facility built in Alaska by a private contractor
would substantially reduce the per diem cost in Alaska facilities.
Bringing competition into the market place will help bring the cost
of their other facilities down as well.
He believes HB 428 addresses the problem of prison capacity, brings
construction and operation jobs to Alaska, brings Alaska money back
to Alaska, provides innovative opportunity to address Alaska's
needs and assures safe and secure prisons.
BOB COLE, Director, Division of Administrative Services, thanked
Representative Mulder for attacking the problem of over-capacity
prisons in Alaska. He said the number of offenders being held on
civil law matters has risen about 6% - 8% per year for the last
several years, the number of man days served has been rising
proportionately.
MR. COLE said that the Governor has an alternative proposal which
envisions regionalized facilities that meet different requirements
of communities around the State. This is particularly important
since the biggest portion of the rise in traffic is in misdemeanors
and pretrial populations which are localized kinds of offenders who
aren't sentenced yet, for the most part. They don't think that a
huge centralized facility like the one proposed in HB 428 in a
single location in the State is going to solve problems in places
like Barrow, Nome, Palmer, and Juneau.
MR. COLE said they have concerns about the propriety of issuing
RFP's to private contractors to propose to build a facility of up
to 1,000 beds at $100 million instead of the design build mode.
They have some concerns about the propriety of doing that in the
sense that it would lock the State into an agreement for a 20 year
period of time. The Governor's approach envisions issuing GO bonds
in the amount $148,500,000 for slightly over 1,000 beds dispersed
across the State.
HB 428 offers no real opportunity for voter input. They think when
they are asking the State for $100 million with a payback potential
of $200 million over a 20 year period of time that the voters
probably should have something to say about it. The Governor's
bill would put the entire matter on the ballot in November of 1996.
The Department recognizes the need for beds in Southcentral Alaska.
The Governor's proposal has an 600 bed proposal for the area in and
near Anchorage.
MR. COLE also pointed out that the Governor's proposal is cast in
the context of a long range financial plan which has been submitted
to the legislature; HB 428 was not.
Number 475
SENATOR SALO asked if there was an accreditation process that would
require certain things of the correctional officers. MR. COLE
replied there is a provision in HB 428 that would require
comparability of training for correctional officers working in the
private sector. This was put in in recognition of the fact that
the State Department of Corrections has an excellent record when it
comes to deaths, fights, assaults, and that sort of thing. There
is a very rigorous process in place now for State correctional
officers.
SENATOR TORGERSON asked if this bill passed the full body, if they
looked at it as a mandate to go forward with private prisons or as
an option to lay alongside the table with the GO bond proposal?
MR. COLE answered if there is some agreement reached during the
session including both in a single piece of legislation, he didn't
know what the answer would be.
SENATOR TORGERSON said he didn't think this mandated building a
private prison since the wording was "shall" look into it and "may"
come forward with a proposal. MR. COLE replied that the bill was
written permissively.
Number 505
SENATOR KELLY asked for a spreadsheet analysis (capitalization
costs, finance costs, operational costs) of the Governor's proposal
over 20 or 30 years and the proposal in HB 428 for the same time
period. MR. DEWITT replied that there are no sheet like that and
part of the problem in developing that, especially with the
operational side, is that they have left it to the Department to
define the operational needs that the facility ought to fill. He
said he had done a very "quick and dirty spreadsheet" in terms of
the capital costs on both proposals. The Governor's proposal is
about $135,000 capital costs per bed and HB 428 is a little more
than $100,000 per bed.
In terms of operation, they have no reason to believe they would
change the approximate $100 per day cost of operation in the system
through the Governor's proposal. They would expect a private
facility on the average to come in substantially below that.
SENATOR KELLY asked him to bring him a side by side comparison of
the two proposals, construction costs and as near as he could with
the operational costs.
SENATOR TORGERSON said one of the concerns he had with both options
is that they are not considering the option of lease purchase that
the City of Seward has done and the City of Kenai said they would
do. He wanted to see the numbers on the lease purchase agreements
that the city would sell revenue bonds for and then lease it back
to the State as another part of that side by side.
Number 540
MR. COLE said setting aside the matter of what's the right way to
provide correctional services, there are a number of financial pros
and cons to the lease purchase, private purchase, private
capitalization, and general obligation bonding. One of the reasons
they decided to go the general obligation bond route, in addition
to giving full disclosure and participation to the public, is
because they are told it is financially advantageous to the State
to do that for a number of different reasons, both in terms of
initial capital cost and the payback.
CHUCK O'CONNELL opposed HB 428. It does not resolve the problems of
overcrowding in Juneau, Fairbanks, Nome, and Bethel. It puts a
large monolith somewhere in central Alaska which could ultimately
result in some problems requiring them to house inmates where they
can have access to their attorney, families, etc.
He wanted the committee to consider regarding the prisoners in
Arizona that you have additional medical costs, probation costs,
program and other divisional costs. A private contractor would not
have those costs, but the State would still have to bear them. So
if you're going to build a prison in Anchorage, the fair way to
compare that cost is to compare it to the cost of running a
facility nearby. For example, the Department has published a cost
of care institution by institution, presently at Palmer
Correctional Center. The cost is $62.51 per day while Mr. DeWitt
testified that the total cost in Arizona is $73 per day.
MR. O'CONNELL said he thought we would be extremely competitive if
we compared the right figures. He said that HB 428 is a whole new
approach. Prisoners do not spend all their time in jail. They are
on the road to the doctor, to the dentist, to court. They are in
and out of jail all the time. This is a public safety concern that
has had no study. They are talking about spending $200 million
without a fiscal plan or analysis of whether or not this is a
prudent way to spend state dollars.
MR. O'CONNELL reiterated that ASEA completely opposed this bill.
He said we have never had a correction officer killed in the State
of Alaska and we are the only State that can say that. And we have
never had an inmate killed.
TAPE 96-28, SIDE B
He said we have an efficient, safe, correctional system and
although the costs are high, when you compare the costs of the
institution itself to the cost of an institution in Arizona, they
are very competitive.
SENATOR KELLY interrupted Mr. O'Connell and apologized to him and
everyone else for the little amount of time they could spend on
this issue today because of the end of session. He said they would
come back on Tuesday and see what the Department of Revenue would
say.
SENATOR KELLY adjourned the meeting at 3:37 p.m.
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