Legislature(1995 - 1996)

04/19/1996 01:35 PM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
               SENATE STATE AFFAIRS COMMITTEE                                
                         April 19, 1996                                        
                           1:35 p.m.                                           
                                                                               
  MEMBERS PRESENT                                                              
                                                                               
 Senator Bert Sharp, Chairman                                                  
 Senator Randy Phillips, Vice-Chairman                                         
 Senator Jim Duncan                                                            
                                                                               
  MEMBERS ABSENT                                                               
                                                                               
 Senator Loren Leman                                                           
 Senator Dave Donley                                                           
                                                                               
  COMMITTEE CALENDAR                                                           
                                                                               
 SENATE BILL NO. 310                                                           
 "An Act making corrective amendments to the Alaska Statutes as                
 recommended by the revisor of statutes; and providing for an                  
 effective date."                                                              
                                                                               
 SENATE BILL NO. 203                                                           
 "An Act establishing the Legislative Task Force on Recycling                  
 Industries Development in Alaska; and providing for an effective              
 date."                                                                        
                                                                               
 SENATE BILL NO. 314                                                           
 "An Act relating to issuance of a restaurant or eating place liquor           
 license."                                                                     
                                                                               
                                                                               
 HB 364 (ELECTION CRIMES; INTERFERENCE W/VOTING) was scheduled, but            
 not taken up on this date.                                                    
                                                                               
  PREVIOUS SENATE COMMITTEE ACTION                                             
                                                                               
 SB 310 - No previous Senate committee action.                                 
                                                                               
 SB 203 - No previous Senate committee action.                                 
                                                                               
 SB 314 - See State Affairs minutes dated 3/28/96 and 4/11/96.                 
                                                                               
  WITNESS REGISTER                                                             
                                                                               
 Pamela Finley, Revisor of Statutes                                            
 Legislative Legal & Research Services                                         
 130 Seward St., Ste. 409, Juneau, AK 99801-2105¶(907)465-2450                 
   POSITION STATEMENT: testified on SB 310                                     
                                                                               
 Mike Ford, Attorney                                                           
 Legislative Legal & Research Services                                         
 130 Seward St., Ste. 409, Juneau, AK 99801-2105¶(907)465-2450                 
   POSITION STATEMENT: testified on SB 314                                     
                                                                               
  ACTION NARRATIVE                                                             
                                                                               
                  SB 310 1996 REVISOR'S BILL                                 
                                                                               
 TAPE 96-30, SIDE A                                                            
                                                                               
 Number 001                                                                    
                                                                               
 CHAIRMAN SHARP called the Senate State Affairs Committee to order             
 at 1:13 p.m. and brought up SB 310 as the first order of business             
 before the committee.  He called Ms. Finley to testify.                       
                                                                               
 PAMELA FINLEY, Revisor of Statutes, Legislative Legal & Research              
 Services, stated SB 310 corrects mistakes that have been made in              
 previous statutes, codification, and deletion of dated references.            
 There is a sectional analysis, which committee members should have.           
 There are some criminal sections in SB 310, which is unusual; we              
 don't usually put those in revisor's bills.  But they were fairly             
 bad mistakes, and some of them may drop out due to the pending joy-           
 riding legislation.  At the end of the bill there is a section                
 stating that if another bill passes this session with an earlier              
 effective date than SB 310, the other bill will prevail if there              
 are any conflicts.  Ms. Finley wants to ensure, because SB 310 is             
 going through so late, that any substantive changes made by the               
 legislature are not messed up by the revisor's bill.                          
                                                                               
 Number 035                                                                    
                                                                               
 MS. FINLEY stated there is also a proposed amendment to Section 17            
 of SB 310.  The amendment is incorporated in Section 17 of the                
 proposed State Affairs Committee substitute.  The amendment would             
 use the general terminology "permits", instead of "dipnet permits",           
 because the Department of Fish & Game issues educational permits,             
 which have different dates than the dipnet permits.                           
                                                                               
 SENATOR RANDY PHILLIPS made a motion to adopt the State Affairs               
 Committee substitute for SB 310.                                              
                                                                               
 CHAIRMAN SHARP, hearing no objection, stated the committee                    
 substitute was adopted.                                                       
                                                                               
 SENATOR RANDY PHILLIPS made a motion to discharge SB 310 from the             
 Senate State Affairs Committee with individual recommendations.               
                                                                               
 CHAIRMAN SHARP, hearing no objection, stated SB 310 was discharged            
 from the Senate State Affairs Committee.                                      
                                                                               
                                                                               
          SB 203 TASK FORCE ON RECYCLING INDUSTRIES                          
                                                                               
 Number 072                                                                    
                                                                               
 CHAIRMAN SHARP brought up SB 203 as the next order of business                
 before the Senate State Affairs Committee.                                    
                                                                               
 Number 080                                                                    
                                                                               
 SENATOR JIM DUNCAN, prime sponsor of SB 203, stated the bill would            
 establish a legislative task force on recycling industries                    
 development in Alaska.  The objective is to develop a state-wide              
 plan for in-state industrial uses for recycled materials.                     
 Integrating recycling markets and economic development is essential           
 to the success of a state-wide recycling program.  Development of             
 such a program will likely have to originate in urban markets and             
 branch out as the program grows.  The focus of the task force will            
 be on what type of products can be recycled, where feasible markets           
 for these products are located, and how much financial support, if            
 any, will be needed.  Senator Duncan noted that committee members             
 have backup information in their bill packets.  There is a fiscal             
 note from the Legislative Affairs Agency.                                     
                                                                               
 CHAIRMAN SHARP asked if there are questions of the sponsor.                   
 Hearing none, he stated it looks like a good idea to him.  He asked           
 the pleasure of the committee.                                                
                                                                               
 SENATOR RANDY PHILLIPS thinks it is a good idea also.                         
                                                                               
 SENATOR DUNCAN made a motion to discharge SB 203 from the Senate              
 State Affairs Committee with individual recommendations.                      
                                                                               
 Number 125                                                                    
                                                                               
 CHAIRMAN SHARP, hearing no objection, stated SB 203 was discharged            
 from the Senate State Affairs Committee.                                      
                                                                               
                                                                               
          SB 314 RESTAURANT LIQUOR LICENSE OWNERSHIP                         
                                                                               
 Number 130                                                                    
                                                                               
 CHAIRMAN SHARP brought up SB 314 as the next order of business                
 before the Senate State Affairs Committee.  He asked the bill                 
 drafter to review SB 314, "G" version.                                        
                                                                               
 Number 314                                                                    
                                                                               
 MIKE FORD, Attorney, Legislative Legal Services, reviewed the bill            
 by section.                                                                   
                                                                               
 Section 1: applies to brewery licenses; would reduce the amount               
 that a brewery could sell to a person present on the premises from            
 5 to 2.5 gallons.  It would make a corresponding change on line 8             
 to be consistent with line 6.                                                 
                                                                               
 Section 2: makes corresponding changes so that a brew-pub licensee            
 would have the same benefits that the brewery has, as far as sale             
 of beer manufactured on the premises and sampling.                            
                                                                               
 Sections 3 & 4: deal with the original purpose of the bill.                   
 Section 3: places a restriction on combination of licenses.                   
 Section 4: creates an exception to Section 3 for existing                     
 licensees.  It also allows for transfer of licenses.                          
                                                                               
 Number 205                                                                    
                                                                               
 CHAIRMAN SHARP asked if subsection (i) in Section 4 would not allow           
 people with brewery licenses to get a restaurant beer and wine                
 license and open an establishment in Fairbanks.                               
                                                                               
 MR. FORD replied the idea is that if you have a rule saying you               
 cannot have this combination, with an exception for those who                 
 already are licensed, then what happens as far as additional                  
 brewery or restaurant licenses, beyond those that already exist?              
 Can they be obtained, or not?  This simply specifies that they                
 cannot.  This addresses whether those with existing licenses could            
 obtain a second license.  It's up to the committee to decide                  
 whether they like that or not.  It sets a finite limit on the                 
 number of these types of licenses.                                            
                                                                               
 MR. FORD continued the sectional analysis.                                    
                                                                               
 Section 5: provision to recapture an increase in value of                     
 grandfathered combination licenses.  The state will get a                     
 percentage of the increased value of the sale of those licenses.              
                                                                               
 Section 6: applicability.                                                     
                                                                               
 Number 240                                                                    
                                                                               
 MR. FORD stated the committee has an amendment that would allow a             
 person to get an additional license.  The committee can decide                
 whether or not they want a licensee to be able to get an additional           
 license.  There is another amendment which would raise the amount             
 allowed to be sold for off premises consumption to 5 gallons.                 
                                                                               
 Number 255                                                                    
 CHAIRMAN SHARP commented that if they stay at 2.5 gallons, the only           
 containers available for transport would be in gallon or half                 
 gallon bottles, which have screw-caps and can be drunk out of as              
 soon as the purchaser gets in the car.  He would like to leave the            
 amount at 5 gallons, because that is a keg, and would not usually             
 be tapped in a car.                                                           
                                                                               
 SENATOR RANDY PHILLIPS made a motion to adopt the amendment raising           
 that amount from 2.5 gallons to 5 gallons.                                    
                                                                               
 CHAIRMAN SHARP, hearing no objection, stated the amendment was                
 adopted.                                                                      
                                                                               
 CHAIRMAN SHARP asked Mr. Ford to explain amendment G.1                        
                                                                               
 MR. FORD responded amendment G.1 would take the opposite approach             
 of the draft.  Instead of restricting a person to their existing              
 licenses, they would be able to get more licenses.                            
                                                                               
 SENATOR RANDY PHILLIPS asked if the amendment would take away from            
 the original intent of the legislation.                                       
                                                                               
 MR. FORD replied it would seem to do so, if the intent is to limit            
 these kinds of combinations.                                                  
                                                                               
 SENATOR DUNCAN asked if someone new could get into the business, if           
 they don't currently have one of these license combinations.                  
                                                                               
 MR. FORD responded they could not.                                            
                                                                               
 SENATOR DUNCAN stated, then SB 314 would just grandfather in                  
 existing licenses, and wouldn't allow any new ones, not even in               
 other parts of the state outside Anchorage.                                   
                                                                               
 MR. FORD replied that is correct.  They couldn't do it as a                   
 combination.  The Alaska Brewing Company couldn't get a restaurant            
 beer and wine license under this bill.                                        
                                                                               
 SENATOR DUNCAN asked what they could do.                                      
                                                                               
 MR. FORD responded they will only be able to operate as a brewery.            
 They couldn't get a beverage dispensary license or a package store            
 license either.                                                               
                                                                               
 SENATOR DUNCAN asked, then the Alaska Brewing Company couldn't come           
 downtown and set up a little brewery operation and serve food also.           
                                                                               
                                                                               
 MR. FORD replied, no.                                                         
                                                                               
 CHAIRMAN SHARP asked if the amendment, if passed, would allow them,           
 or anyone else with a brewery and restaurant license to open one up           
 in Fairbanks.                                                                 
                                                                               
 MR. FORD responded, if that person already had a brewery and                  
 restaurant license, the amendment would allow them to get another             
 license.  It would allow them to get four, five, ten more, or                 
 whatever.                                                                     
                                                                               
 CHAIRMAN SHARP asked if under current law licensees are prohibited            
 from owning multiple licenses.                                                
                                                                               
 MR. FORD responded it is only prohibited for certain types of                 
 licenses, but not for restaurant or eating place licenses.  Under             
 this bill, that would be illegal though.                                      
                                                                               
 CHAIRMAN SHARP stated SB 314 would restrict brew-pubs to Anchorage,           
 and no where else.                                                            
                                                                               
 MR. FORD responded that is correct.  You could have a brew-pub, but           
 not a restaurant and a brewery.  You would have to have a beverage            
 dispensary license.                                                           
                                                                               
 SENATOR DUNCAN stated the ones in Anchorage brew, sell beer, and              
 food, and that wouldn't be able to occur any where else in the                
 state under SB 314.                                                           
                                                                               
 MR. FORD replied that is correct.                                             
                                                                               
 Number 330                                                                    
                                                                               
 SENATOR DUNCAN asked why they would want to shut down this type of            
 business.                                                                     
                                                                               
 SENATOR RANDY PHILLIPS responded because George Malekos thinks it             
 is an unfair level of competition against his business.  Mr.                  
 Malekos has spent several hundred thousand dollars for his                    
 licenses, while these types of businesses have only spent $1,600.00           
 for their licenses.  The entry fee is not level for basically the             
 same type of business.  That's where the argument is.                         
                                                                               
 SENATOR DUNCAN asked if they were really doing the same thing                 
 though, because Mr. Malekos has a liquor license.                             
                                                                               
 CHAIRMAN SHARP stated that Mr. Malekos got involved in it before              
 the ABC Board allowed the waiver on the 50% food - 50% booze                  
 requirement.  That's what opened the window on the brew-pub without           
 a liquor license.                                                             
                                                                               
 SENATOR RANDY PHILLIPS stated there are a few other businesses in             
 his district that feel the same way as Mr. Malekos.                           
                                                                               
 CHAIRMAN SHARP stated that during testimony at the last hearing,              
 two people supported SB 314 while twelve people opposed it.  He has           
 a problem with no one else being able to start one of these types             
 of establishments.  Not even the people being grandfathered in can            
 start one in Fairbanks.  That's one of the reasons he had amendment           
 G.1 drawn up: it would at least allow some expansion to other                 
 towns.                                                                        
                                                                               
 SENATOR DUNCAN stated amendment G.1 would allow expansion to other            
 towns, but it would also allow expansion in Anchorage.                        
                                                                               
 SENATOR RANDY PHILLIPS stated that would defeat the original intent           
 of the bill.                                                                  
                                                                               
 CHAIRMAN SHARP asked if the amendment would open it up.                       
                                                                               
 MR. FORD replied it opens it up for those people who are                      
 grandfathered in.                                                             
                                                                               
 SENATOR DUNCAN stated that bothered him.  Why shouldn't they allow            
 the Alaskan Brewery to open a brew-pub in Juneau, if they so                  
 desire?  He asked if there was some way to put a limit on it,                 
 perhaps by population?                                                        
                                                                               
 MR. FORD stated there are a number of restrictions in law based               
 upon population.  You could certainly use that as a limiting                  
 factor.                                                                       
                                                                               
 CHAIRMAN SHARP asked Mr. Ford to give them a conceptual amendment             
 using population as a limiting factor.                                        
                                                                               
 Number 390                                                                    
                                                                               
 MR. FORD thinks they don't want amendment G.1 or Sections 3 and 4             
 in that case.  You won't be dealing with grand-fathering, what you            
 will do is specify there can't be any more than a certain number of           
 these licenses per certain population.  Pick a number that allows             
 the people who would have been grandfathered to continue to                   
 operate, and also would allow these business to operate in other              
 areas of the state, if they so choose.                                        
                                                                               
 CHAIRMAN SHARP commented if they set the population number too                
 high, then the smaller communities wouldn't be able to have this              
 type of a business.                                                           
                                                                               
 SENATOR DUNCAN asked if they couldn't simply specify a population             
 of "x" or less?  You could specify that one license is allowed for            
 a community with a population of 50,000 or less.                              
                                                                               
 MR. FORD stated you could do it however you want.                             
                                                                               
 SENATOR RANDY PHILLIPS stated you wouldn't want to pick a number              
 that would exclude any of the businesses already in the process of            
 opening.                                                                      
 SENATOR DUNCAN stated he is willing to let the bill move from                 
 committee with a conceptual amendment on that.                                
                                                                               
 CHAIRMAN SHARP suggested specifying no more than one license per              
 30,000 of population or less.  Allow one license up to 30,000, then           
 after that, no more than one license for every additional 30,000 of           
 population or partial of.                                                     
                                                                               
 MR. FORD gave an example: if a community had a population of                  
 31,000, they could have two brew-pubs.                                        
                                                                               
 SENATOR DUNCAN added, if a community had a population of 28,000,              
 they could have one.                                                          
                                                                               
 MR. FORD responded that would be correct.                                     
                                                                               
 SENATOR RANDY PHILLIPS wanted the committee to understand what                
 triggered the problem in the first place.  He doesn't think it's              
 fair that some people had to pay so much for a similar type of                
 business.  That's where the problem started.                                  
                                                                               
 SENATOR DUNCAN asked if he understood: Mr. Malekos doesn't want any           
 more competition.                                                             
                                                                               
 CHAIRMAN SHARP responded Mr. Malekos had to buy a liquor dispensary           
 license for $200,000.00 to be in the same business as these other             
 guys.                                                                         
                                                                               
 SENATOR DUNCAN asked Senator Phillips if he wanted to close Snow              
 Goose down.                                                                   
                                                                               
 SENATOR RANDY PHILLIPS replied, no.  But Mr. Malekos wants the                
 playing field to be level in the future.  Senator Phillips stated             
 he agrees with Mr. Malekos.                                                   
                                                                               
 CHAIRMAN SHARP commented he would like to see at least one brew-pub           
 in his town.  He asked if the committee can approve the conceptual            
 amendment.                                                                    
                                                                               
 CHAIRMAN SHARP, hearing no objection, stated a conceptual amendment           
 that allows one combination license for up to 30,000 population,              
 and additional licenses for each 30,000 or less of additional                 
 population was adopted.                                                       
                                                                               
 SENATOR RANDY PHILLIPS asked a question that was indiscernible.               
                                                                               
 MR. FORD responded it would apply to either.                                  
                                                                               
 SENATOR DUNCAN asked if Sitka could have one of these types of                
 businesses under this amendment.                                              
                                                                               
 MR. FORD replied they could have a business with one of these                 
 combination licenses.                                                         
                                                                               
 CHAIRMAN SHARP stated the ABC Board will be reviewing the licensing           
 structures during the interim to come up with recommendations on              
 this, since they opened up this can of worms.                                 
                                                                               
 SENATOR RANDY PHILLIPS stated they helped by passing the law.                 
                                                                               
 CHAIRMAN SHARP asked if he could have a motion to move SB 314.                
                                                                               
 Number 450                                                                    
                                                                               
 SENATOR RANDY PHILLIPS made a motion to discharge SB 314, with the            
 conceptual amendment, from the Senate State Affairs Committee with            
 individual recommendations.                                                   
                                                                               
 CHAIRMAN SHARP, hearing no objection, stated SB 314 was discharged            
 from the Senate State Affairs Committee.                                      
                                                                               
 CHAIRMAN SHARP adjourned the Senate State Affairs Committee meeting           
 at 2:20 p.m.                                                                  
                                                                               

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