Legislature(1995 - 1996)
04/19/1996 01:35 PM STA
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
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.