03/27/2008 01:30 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| SB113 | |
| HB289 | |
| SB305 | |
| SJR18 | |
| SB286 | |
| HB357 | |
| HB413 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 286 | TELECONFERENCED | |
| + | HB 357 | TELECONFERENCED | |
| + | HB 413 | TELECONFERENCED | |
| += | SB 113 | TELECONFERENCED | |
| += | SB 118 | TELECONFERENCED | |
| = | SJR 18 | ||
| = | HB 289 | ||
| = | SB 305 | ||
ALASKA STATE LEGISLATURE
SENATE LABOR AND COMMERCE STANDING COMMITTEE
March 27, 2008
1:38 p.m.
MEMBERS PRESENT
Senator Johnny Ellis, Chair
Senator Bettye Davis
Senator Con Bunde
MEMBERS ABSENT
Senator Gary Stevens, Vice Chair
Senator Lyman Hoffman
COMMITTEE CALENDAR
SENATE BILL NO. 113
"An Act relating to break times for employees who nurse a
child."
HEARD AND HELD
SENATE BILL NO. 118
"An Act establishing a fee for disposable plastic bags
distributed by retail sellers of goods or services to consumers
to carry away or protect goods; and establishing the Alaska
litter and marine debris reduction and recycling fund."
SCHEDULED BUT NOT HEARD
SENATE BILL NO. 305
"An Act relating to recorking, sealing, or packaging of wine
served with a meal and removal of recorked, sealed, or packaged
wine from licensed premises."
MOVED SB 305 OUT OF COMMITTEE
CS FOR HOUSE BILL NO. 289(FSH)
"An Act exempting employers from paying unemployment tax for
temporary services provided by fishing vessel crewmembers and
related to emergency oil spill training and response activities;
and providing for an effective date."
MOVED CSHB 289(FSH) OUT OF COMMITTEE
SENATE JOINT RESOLUTION NO. 18
Requesting the President of the United States to direct the
United States Consumer Product Safety Commission to test the
materials used in children's toys and other children's products
for toxicity and to make the results publicly available.
MOVED SJR 18 OUT OF COMMITTEE
SENATE BILL NO. 286
"An Act relating to creation and regulation of pharmacy benefits
managers, and authorizing the board of pharmacy to cooperate
with the division of insurance in regulating pharmacy benefits
managers."
HEARD AND HELD
CS FOR HOUSE BILL NO. 357(L&C)
"An Act requiring errors and omissions insurance for real estate
licensees; renaming the real estate surety fund as the real
estate recovery fund and relating to that fund, and redefining
the procedures and criteria used by the Real Estate Commission
to make an award from the fund to a person suffering a loss
caused by certain misconduct of real estate licensees; requiring
a real estate licensee to maintain an office in the state; and
providing for an effective date."
HEARD AND HELD
HOUSE BILL NO. 413
"An Act extending the termination date for the Real Estate
Commission; and providing for an effective date."
HEARD AND HELD
PREVIOUS COMMITTEE ACTION
BILL: SB 113
SHORT TITLE: NURSING MOTHERS IN WORKPLACE
SPONSOR(s): SENATOR(s) ELLIS
03/12/07 (S) READ THE FIRST TIME - REFERRALS
03/12/07 (S) L&C, HES
02/28/08 (S) L&C AT 1:30 PM BELTZ 211
02/28/08 (S) Heard & Held
02/28/08 (S) MINUTE(L&C)
03/27/08 (S) L&C AT 1:30 PM BELTZ 211
BILL: SB 305
SHORT TITLE: RECORKING WINE SERVED WITH A MEAL
SPONSOR(s): LABOR & COMMERCE
03/21/08 (S) READ THE FIRST TIME - REFERRALS
03/21/08 (S) L&C
03/25/08 (S) L&C AT 1:30 PM BELTZ 211
03/25/08 (S) Scheduled But Not Heard
BILL: HB 289
SHORT TITLE: EMPLOYMENT TAX EXEMPTION: SPILL RESPONSE
SPONSOR(s): REPRESENTATIVE(s) HARRIS, SEATON
01/04/08 (H) PREFILE RELEASED 1/4/08
01/15/08 (H) READ THE FIRST TIME - REFERRALS
01/15/08 (H) FSH, L&C
01/23/08 (H) FSH AT 8:30 AM BARNES 124
01/23/08 (H) Heard & Held
01/23/08 (H) MINUTE(FSH)
01/28/08 (H) FSH AT 8:30 AM BARNES 124
01/28/08 (H) Moved CSHB 289(FSH) Out of Committee
01/28/08 (H) MINUTE(FSH)
01/30/08 (H) FSH RPT CS(FSH) NT 4DP
01/30/08 (H) DP: HOLMES, EDGMON, JOHANSEN, SEATON
02/13/08 (H) L&C AT 3:00 PM CAPITOL 17
02/13/08 (H) Moved CSHB 289(FSH) Out of Committee
02/13/08 (H) MINUTE(L&C)
02/15/08 (H) L&C RPT CS(FSH) NT 4DP 2NR
02/15/08 (H) DP: GARDNER, LEDOUX, BUCH, GATTO
02/15/08 (H) NR: NEUMAN, OLSON
03/13/08 (H) TRANSMITTED TO (S)
03/13/08 (H) VERSION: CSHB 289(FSH)
03/14/08 (S) READ THE FIRST TIME - REFERRALS
03/14/08 (S) L&C, FIN
03/25/08 (S) L&C AT 1:30 PM BELTZ 211
03/25/08 (S) Heard & Held
03/25/08 (S) MINUTE(L&C)
BILL: SJR 18
SHORT TITLE: CHILD PRODUCT SAFETY
SPONSOR(s): SENATOR(s) WIELECHOWSKI
02/19/08 (S) READ THE FIRST TIME - REFERRALS
02/19/08 (S) HES, L&C
03/14/08 (S) HES AT 1:30 PM BUTROVICH 205
03/14/08 (S) Heard & Held
03/14/08 (S) MINUTE(HES)
03/19/08 (S) HES AT 1:45 PM BUTROVICH 205
03/19/08 (S) Moved SJR 18 Out of Committee
03/19/08 (S) MINUTE(HES)
03/21/08 (S) HES RPT 5DP
03/21/08 (S) DP: DAVIS, ELTON, THOMAS, COWDERY,
DYSON
03/25/08 (S) L&C AT 1:30 PM BELTZ 211
03/25/08 (S) Heard & Held
03/25/08 (S) MINUTE(L&C)
BILL: SB 286
SHORT TITLE: PHARMACY BENEFITS MANAGERS
SPONSOR(s): SENATOR(s) ELTON
02/19/08 (S) READ THE FIRST TIME - REFERRALS
02/19/08 (S) L&C, FIN
03/27/08 (S) L&C AT 1:30 PM BELTZ 211
BILL: HB 357
SHORT TITLE: CLAIMS AGAINST REAL ESTATE LICENSEES
SPONSOR(s): LABOR & COMMERCE BY REQUEST
02/06/08 (H) READ THE FIRST TIME - REFERRALS
02/06/08 (H) L&C, FIN
02/11/08 (H) L&C AT 3:00 PM CAPITOL 17
02/11/08 (H) Heard & Held
02/11/08 (H) MINUTE(L&C)
02/22/08 (H) L&C AT 3:00 PM CAPITOL 17
02/22/08 (H) -- MEETING CANCELED --
03/03/08 (H) L&C AT 3:00 PM CAPITOL 17
03/03/08 (H) Moved CSHB 357(L&C) Out of Committee
03/03/08 (H) MINUTE(L&C)
03/04/08 (H) L&C RPT CS(L&C) 3DP 2NR 2AM
03/04/08 (H) DP: GATTO, RAMRAS, OLSON
03/04/08 (H) NR: BUCH, NEUMAN
03/04/08 (H) AM: GARDNER, LEDOUX
03/11/08 (H) FIN AT 1:30 PM HOUSE FINANCE 519
03/11/08 (H) Scheduled But Not Heard
03/12/08 (H) FIN RPT CS(L&C) 5DP 3NR
03/12/08 (H) DP: HAWKER, CRAWFORD, THOMAS, MEYER,
CHENAULT
03/12/08 (H) NR: NELSON, KELLY, STOLTZE
03/12/08 (H) FIN AT 8:30 AM HOUSE FINANCE 519
03/12/08 (H) Scheduled But Not Heard
03/12/08 (H) FIN AT 1:30 PM HOUSE FINANCE 519
03/12/08 (H) Moved Out of Committee
03/12/08 (H) MINUTE(FIN)
03/26/08 (H) TRANSMITTED TO (S)
03/26/08 (H) VERSION: CSHB 357(L&C)
03/27/08 (S) L&C AT 1:30 PM BELTZ 211
BILL: HB 413
SHORT TITLE: EXTENDING THE REAL ESTATE COMMISSION
SPONSOR(s): LABOR & COMMERCE
02/20/08 (H) READ THE FIRST TIME - REFERRALS
02/20/08 (H) L&C, FIN
02/25/08 (H) L&C AT 3:00 PM CAPITOL 17
02/25/08 (H) Moved Out of Committee
02/25/08 (H) MINUTE(L&C)
02/27/08 (H) L&C RPT 5DP
02/27/08 (H) DP: GARDNER, BUCH, NEUMAN, LEDOUX,
OLSON
03/03/08 (H) FIN AT 1:30 PM HOUSE FINANCE 519
03/03/08 (H) Moved Out of Committee
03/03/08 (H) MINUTE(FIN)
03/04/08 (H) FIN RPT 3DP 6NR
03/04/08 (H) DP: CRAWFORD, NELSON, MEYER
03/04/08 (H) NR: HAWKER, STOLTZE, JOULE, THOMAS,
KELLY, CHENAULT
03/10/08 (H) TRANSMITTED TO (S)
03/10/08 (H) VERSION: HB 413
03/12/08 (S) READ THE FIRST TIME - REFERRALS
03/12/08 (S) L&C, FIN
03/27/08 (S) L&C AT 1:30 PM BELTZ 211
WITNESS REGISTER
PATRICK CUNNINGHAM
Staff to Senator Ellis
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Commented on CSSB 113(L&C) for the sponsor.
REPRESENTATIVE PAUL SEATON
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Sponsor of HB 289.
DANA OWEN
Staff to the Senate Labor and Commerce Committee
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Commented on SB 305.
KATHERINE PUSTAY
Staff to Senator Wielechowski
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Sponsor of SJR 18.
BARRY CHRISTIANSON, Co-chair
Legislative Committee
Alaska Pharmacy Association
Ketchikan, AK
POSITION STATEMENT: Supported SB 286.
REGINA BENJAMIN, Senior Director
Public Policy
National Community Pharmacists Association
Alexandria, VA
POSITION STATEMENT: Supported SB 286.
ELEANOR WOLFE
Staff for Representative Kurt Olson
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Commented on HB 357 and HB 413 for the
sponsor.
DAVE FEEKIN
Alaska Association of Realtors
Kenai, AK
POSITION STATEMENT: Supported HB 357.
PAT DAVIDSON, Auditor
Division of Legislative Audit
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Supported HB 413.
ACTION NARRATIVE
CHAIR JOHNNY ELLIS called the Senate Labor and Commerce Standing
Committee meeting to order at 1:38:52 PM. Present at the call to
order were Senators Bunde, Davis, Ellis.
1:41:00 PM at ease 1:41:29 PM
SB 113-NURSING MOTHERS IN WORKPLACE
1:41:29 PM
CHAIR ELLIS announced SB 113 to be up for consideration. He
noted a proposed CS.
PATRICK CUNNINGHAM, staff to Senator Ellis, sponsor of SB 113,
explained CSSB 113(L&C) 25-LS0435\E, and that changes were made
to better clarify the intent of the bill in response to question
raised in the first hearing. One was on page 1, line 10, (b)
that says an employer shall provide a private and sanitary room
or other location in close proximity to the work area. The word
"secure" was deleted to provide more flexibility to the employer
to provide the room without enduring any additional cost. A new
section was added on line 13 (c) that states nothing in this
section requires an employer to allow a child in the work place
at times other than break times. This addresses Senator
Stevens's concern that employers might be required to provide
day care services.
MR. CUNNINGHAM went on to say that section (e) was deleted
because the language "undue hardship" was no longer necessary.
The overriding emphasis is to provide reasonable accommodation
to the nursing mother.
SENATOR BUNDE asked how "reasonable" would be defined in
relation to "undue hardship".
MR. CUNNINGHAM answered that could be addressed in regulation.
CHAIR ELLIS set SB 113 aside for further work.
CSHB 289(FSH)-EMPLOYMENT TAX EXEMPTION: SPILL RESPONSE
1:46:39 PM
CHAIR ELLIS announced CSHB 289(FSH) to be up for consideration.
REPRESENTATIVE SEATON, sponsor of HB 289, said this measure
deals with exempts fishing vessel owners and crew who
participate from having to pay unemployment taxes while they are
performing oil spill response duties.
1:47:40 PM
SENATOR BUNDE moved to report CSHB 289(FSH) from committee with
individual recommendations and attached fiscal notes. There were
no objections and it was so ordered.
SB 305-RECORKING WINE SERVED WITH A MEAL
1:48:25 PM
CHAIR ELLIS announced SB 305 to be up for consideration.
DANA OWEN, staff to the Senate Labor and Commerce Committee,
explained SB 305 allows patrons at a restaurant who order a
bottle of wine to take that bottle with them as they leave if
they haven't finished it. The bill is supported by the industry
with the idea that people will more likely purchase a bottle of
wine rather than a glass. It is also supported by folks who
believe it will create a positive incentive for people to not
drink too much at the table because they order an expensive wine
and might feel compelled to finish it. Thirty-four other states
have recorking laws.
SENATOR BUNDE asked if industry is comfortable with resealing.
MR. OWEN answered yes.
SENATOR BUNDE asked if they had heard from restaurants and bars.
MR. OWEN replied that he has received verbal support from them.
CHAIR ELLIS recapped this issue had been before the legislature
for some time.
1:51:05 PM
SENATOR BUNDE moved to report SB 305 from committee with
individual recommendations. There were no objections and it was
so ordered.
SJR 18-CHILD PRODUCT SAFETY
1:51:56 PM
KATHERINE PUSTAY, staff to Senator Wielechowski, sponsor of SJR
18, recapped that this measure calls on the United States
Consumer Products Safety Commission or CSBC to test materials
used in children's products and toys for hazardous chemicals
like lead. She said while the CSBC tests for choking and
aspiration issues, currently no government agency is tasked to
do this chemical testing. Twenty-nine other states have passed
similar resolutions.
1:53:29 PM
SENATOR BUNDE moved to report SJR 18 from committee with
individual recommendations. There were no objections and it was
so ordered.
SB 286-PHARMACY BENEFITS MANAGERS
1:54:38 PM
CHAIR ELLIS announced SB 286 to be up for consideration.
SENATOR ELTON, sponsor of SB 286, said he hoped to begin and
refine a dialogue. This bill is based on model legislation that
has been done elsewhere and they already know of a few alignment
issues need to occur between this bill and the existing
structure.
He said pharmacy benefit managers (PBM) are groups of businesses
that people contract with to manager pharmacy and prescription
drug insurance plans. These plan managers include the State of
Alaska, the federal government and union groups. He said that
PBMs are largely unregulated. The purpose of this bill is to
provide transparency into their business model.
SENATOR ELTON related that PBMs negotiate with drug
manufacturers and pharmacies on behalf of health insurance
plans, but those negotiations and arrangements aren't
transparent. The danger is that PBMs receive financial
remuneration from drug manufacturers and because those
transactions aren't transparent, they don't pass any information
to the contractor - information like allocation and
recommendations on what drugs should be used. It doesn't allow
the contractor, the state for instance, to know what kind of
other profits the PBM is getting based on the contract it has
with the state.
He said another major concern is how PBMs might increase their
profit margins. For instance, in many cases PBMs also have mail
order drug stores and it's to their benefit to try and shift
business from a pharmacy that may be located down the street
that has a relationship with both the doctor and the person who
is getting the drugs to the mail order firms.
1:58:36 PM
SENATOR ELTON said the bill allows the Board of Pharmacy to
regulate the terms of an agreement and lets the Division of
Insurance access the PBM's books and records that are pertinent
to the contract they have with the person providing the drug
benefit. This gets back to the issue of alignment, and he didn't
know if what worked in other states would work in Alaska. They
need to discuss whether or not they want the Board of Pharmacy
to get into this kind of business; it might be more appropriate
for the Division of Insurance to fill this role.
1:59:25 PM
He said 20 other states' attorney generals have sued PBMs to try
and get the information; eight states plus the District of
Columbia have adopted a similar transparency bill. He clarified
that when he is talking about transparency, he is not talking
about the state or any other contractor posting this
information. He is talking about transparency between the
contractor and the PMB itself. This information is proprietary
and is not shared with the public.
SENATOR ELTON said another important provision does not allow
"extrapolation audits" by PBMs. He explained that PBMs or their
agents can now go to a local pharmacy and audit its books, and
if they find an error, even a keystroke error - and that may be
a $25 error one way or the other - an extrapolation audit allows
the PBM to charge for the prescription of the one drug. If the
pharmacy has done 150 or 1,500 other prescriptions for this
drug, the extrapolation audit allows the PBM to charge the
pharmacy for an error on each transactions a single $25 or $50
error can cost a pharmacy $75,000 to $80,000. So this bill
doesn't allow extrapolated audits; but it doesn't disallow
audits.
2:03:00 PM
SENATOR BUNDE asked if this bill in any way prohibited online
purchases.
SENATOR ELTON replied nothing in this bill prohibits people from
shopping on line. He tried to convey that some PBMs have a
business imperative to try and to create a situation in which
they make it easier for people to buy their drugs through their
subsidiary online, and because of that they might not have a
business incentive to try to keep their local pharmacy going. He
meant to suggest that there is no way the contractor could know
something has happened without being able to pull back the veil
that PBMs now have.
2:05:33 PM
BARRY CHRISTIANSON, Co-chair, Legislative Committee, Alaska
Pharmacy Association, said he is a practicing community
pharmacist in Ketchikan and supported SB 286. It will help
insure that Alaska patients, employers and pharmacists are being
fairly treated by an industry that manages the processing of
prescription drug benefits. The PBM industry started out simply
acting as a conduit for claims processing between pharmacies and
insurance companies. However, this simple model has ballooned
into a myriad of other services that has made this industry a
very profitable middle man in managed health care. The
Association believes this profitability has come at the expense
of patient care and has not lowered overall drug costs. It has
been estimated that it takes 25-30 percent of pharmacy staff
time every day to try to navigate the maze of "pharmacy benefit
manager audits." This time is usually spent on the phone talking
to a claims representative in another state or country. Yet for
all of their efforts, their members every day bear the brunt of
public comment about higher drug costs.
They believe the transparency called for in SB 286 will help
insure the manufacturer rebates negotiated by the PBMs will flow
back to the plans' sponsor or employer. They also believe that
the authorized substitution sections of the bill will help
ensure that patients know they are receiving the most cost
effective medication as approved by their prescriber. Far too
often they see instances of drug substitutions being made by
PBM-owned mail order pharmacies. While these substitutions are
legal, they are not communicated to the patient. This can result
in the patient continuing to take the original prescribed
medication along with a substitute medication simply because
they sound or look alike. An example is blood pressure drugs
called Ramipril and Lisinopril. Lastly, he said SB 286 does not
pad the pockets of Alaska pharmacies, but it sets up pricing
guidelines based on national standards and time limits for
pharmacy audits and payments.
2:09:00 PM
MR. CHRISTIANSON said most Alaska pharmacists don't believe
legislation is needed for every health care ill; since they are
a heavily regulated profession. However, now is the time to
consider regulating the PBM industry because it has had too many
instances of unfair business practices.
2:09:37 PM
REGINA BENJAMIN, Senior Director, Public Policy, National
Community Pharmacists Association, Alexandria, VA, said some of
her members are in Alaska and they support SB 286. She said her
concern is that PBMs are the only entities that are involved in
a variety of functions that impact the delivery and the cost of
prescription drug benefits to the consumer, but they are largely
unregulated.
She said the most stringent regulation to date was found in a
law passed in Maine. The PBMs were successful in tying that law
up in court for several years, but it succeeded at every level
of court action. Pharmacy Care Management Association (PCMA) is
the trade association for the PBMs that challenged the law. The
law finally became effective in June 2006. Now PCMA is also
suing District of Columbia for a similar law.
MS. BENJAMIN stated that now they have regulation by litigation
and settlement. There have been two large settlements, one by 22
states attorneys general against Medco in 2004 and last month by
PBS Caremark with 28 states and the District of Columbia. These
settlements with consent orders involved substitutions and lack
of transparency which this bill tries to regulate in Alaska.
She said that 15 states over the last 3 or 4 years have passed
some kind of legislation that has some minimal oversight of PBMs
and states continue to look at the industry and debate whether
it should be regulated. Some of the supporters of legislation
are the National Legislative Association on Prescription Drug
Prices, a group of bi-partisan legislators, Consumers Union,
AARP, National Mental Health Association and in some cases the
Medical Societies. She said this industry has a large impact on
the cost of health care in this country, and with transparency
employers will save money because they will realize mail order
is not as cheap as they think it is based on the limited
information they are given.
2:14:05 PM
MS. BENJAMIN said SB 286 provides consumer protection especially
in the area of substitution, which is a major problem. She
explained the reason PBMs substitute medication is because they
get a higher rebate on one drug than they do on another and they
don't consider the medical ramifications for the person taking
the drug.
CHAIR ELLIS thanked her for her testimony and closed the public
hearing saying he would hold the bill for further work.
CSHB 357(L&C)-CLAIMS AGAINST REAL ESTATE LICENSEES
2:15:51 PM
ELEANOR WOLFE, staff for Representative Kurt Olson, sponsor of
HB 357, said the sponsor introduced this bill on behalf of the
Alaska Association of Realtors that felt it was necessary due to
difficulties with the Surety Fund to provide that all real
estate agents have errors and omissions (E&O) insurance. She
explained that most large brokerages already provide E&O
insurance, but about 40 percent of the agents in Alaska don't.
This measure would have the department seeking a group policy
with a minimum $100,000 coverage that all members could belong
to at a reasonable rate. This would allow most of the complaints
that go to the surety fund to be handled through insurance
rather than have all of the complaints go through the surety
fund that has a maximum of $15,000. A good number of complaints
against real estate transactions exceed that.
MS. WOLFE stated that the surety fund would be renamed the
recovery fund and it would cover actions of deceit and breach of
trust. She said one insurance company handles the existing 13
states that have this provision and it is willing to make an
offer once the parameters are laid out by the department. She
believes agents could be covered for less than $200 year.
CHAIR ELLIS asked if she has had assurance that an insurance
entity is out there that will write insurance in Alaska.
MS. WOLFE replied yes.
2:17:38 PM
DAVE FEEKIN, Alaska Association of Realtors, Kenai, said that HB
357 is a joint effort by the Alaska Association of Realtors, the
Division of Occupational Licensing, the Division of Insurance
and the Department of Law. It accomplishes two things. The
surety fund expands the claim coverage by imposing mandatory E&O
insurance.
MR. FEEKIN explained that the surety fund was started in 1974
and covers reimbursement for fraud, misrepresentation, deceit
and conversion of trust. By statute the fund balance has to be
$250,000-$500,000. That money comes from the licensees at the
amount of $30 per license period, every two years. A few years
ago the fund balance was at or above the $500,000, but more
recently it has been bouncing around below the $250,000 mark.
Two reasons the funds balance is dropping is because there are a
high number of frivolous claims brought against licenses that
cost the fund to hold the hearings even though they are
meritless. The second is a reduction in the number of licensees,
and that moves with the market. He said the number of licensees
doubled from 2000-2005 and the number of transactions peaked at
2006 in Alaska and 2005 in the Lower 48. The U.S. as a whole has
seen a 33 percent drop in real estate transactions, but Alaska
has had a drop of 11 percent from 2006 to 2007; this year it
continues the same decline.
MR. FEEKIN said it's important to understand how small this
problem really is in light of the size of the market. In 2006,
15 claims were filed against the surety fund and none of them
were successful in obtaining a claim. In 2007, 13 claims were
filed with two getting paid. MLS statistics for Southcentral
Alaska plus Kodiak indicated an average of 9,119 real estate
transactions per year for each of those two years, a lot of
successful transactions. The value of those transactions was $2
billion per year. Imposing mandatory E&O insurance is supported
overwhelmingly by the industry, because it is a very affordable
cost at $200 or less. Colorado, Idaho, Iowa, Kentucky,
Louisiana, Mississippi, Nebraska, New Mexico, North Dakota,
Rhode Island, South Dakota, Tennessee and Wyoming are the states
involved. Rice and Associates considers Alaska to be very
similar to Wyoming as far as the number of licensees. It is
considered less of a risk because we don't have the very high
second home values that Wyoming has. He knew of no opposition.
The state has never purchased a group policy for licensees
before so the mechanism had to be worked out.
CHAIR ELLIS thanked him for his comments and said HB 357 would
be held.
HB 413-EXTENDING THE REAL ESTATE COMMISSION
2:24:10 PM
CHAIR ELLIS announced HB 413 to be up for consideration.
ELEANOR WOLFE, staff to Representative Kurt Olson, sponsor of HB
413, explained this was requested by the Department of Commerce,
Community & Economic Development and Legislative Budget and
Audit Committee. No one had introduced a bill to extend the Real
Estate Commission and the Legislative Auditor advised to extend
it to 2016.
2:25:11 PM
PAT DAVIDSON, Division Of Legislative Audit, said her review
indicated that the commission was operating in a satisfactory
manner and she recommended a 2016 termination date. She also
recommended to the Office of the Governor that they verify the
qualifications of board members before presenting them to the
legislature for confirmation. One of the recent appointments to
the board did not have the necessary years of professional
experience.
CHAIR ELLIS asked if that recommendation was well received
advice.
MS. DAVIDSON replied the Governor's Office concurred with the
recommendation and said they would improve their procedures to
ensure that professional requirements were met for any of their
nominees.
CHAIR ELLIS thanked her for her help and closed the public
hearing saying the bill would be held. There being no further
business to come before the committee, he adjourned the meeting
at 2:27:36 PM.
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