SENATE BILL NO. 193 "An Act relating to bonds required for contractors." 8:53:19 AM Co-Chair Stoltze noted that the bill was debated in a previous committee hearing. He stated that the proposed CS deleted the provision for "handyman." Representative Wilson MOVED to ADOPT the proposed committee substitute for SB 193, Work Draft 28-LS0697\Y (Martin, 4/17/14). Representative Guttenberg objected for the purpose of discussion. Co-Chair Stoltze asked if the senator was familiar with the intent of the language change in the CS. SENATOR PETER MICCICHE suggested a misunderstanding regarding the term "handyman." He clarified that the handyman category protected the handyman's interests. A handyman would require a $5 thousand bond rather than the $10 thousand expected from a contractor. If a person was not a contractor, the regulations would not be changed. He explained that the decreased bond cost was requested by Alaskan handymen. 8:55:30 AM SARA CHAMBERS, DIRECTOR, DIVISION OF CORPORATIONS, BUSINESS AND PROFESSIONAL LICENSING, DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT, stated that Department of Commerce, Community and Economic Development experienced frequent requests from handymen for state licensure. She noted that a misconception existed within the community regarding the complex exemption list provided by the department. Co-Chair Stoltze asked if a handyman would obtain a regular business license. Ms. Chambers concurred, but noted that the guidelines regarding the necessity of a contractor's license were often confusing. The department believed that codifying a handyman license for the correct professional and business license categories would assist those people seeking the licensure. 8:57:30 AM Senator Micciche stated that the change in the CS would move the handyman into a higher category and cost them more for licensing. He believed that the objective of the CS was to save money for the handyman, but instead the change moved them into a more expensive level of bonding. He stated that the bond would cost $150 to $250 annually for the entry level, which would protect the handyman and the customer. 8:58:45 AM Representative Wilson asked how the CS and original version affected the handyman. Senator Micciche responded that for earnings less than $2500 per job nothing changed. He noted that the bill did not alter the laws governing contractors. He clarified that the action of advertising would lead to establishment of a contractor status. Co-Chair Stoltze noted that advertising was the trigger. 9:00:27 AM Representative Wilson pointed out the qualification figure of $10 thousand. Senator Micciche responded that prior to the legislation, a contractor required insurance at $2500, but did not require a bond. Representative Wilson asked if the CS would cause an expense for the handyman category that was prevented in the original legislation. Senator Micciche responded that that a lower-level handyman would pay between $150 and $250 more for the bond with the CS. 9:01:52 AM Ms. Chambers added that the department served many Alaskans seeking business licenses. Many handymen advertised, which required licensure as a general or specialty contractor. She spoke of 516 investigative matters last year for the construction contractor category. She stated that the Department of Labor and Workforce Development would investigative matters for unlicensed practice. She stated that the legislation would help avoid a $1000 daily fine for being in business as a handyman without a license. Representative Wilson understood that the solution was licensure. Ms. Chambers concurred. 9:04:04 AM Vice-Chair Neuman asked for CS version clarification during the committee discussion. Senator Micciche stated that he had been referring to the original legislation. Representative Costello asked for version clarification throughout Ms. Chambers' testimony. Ms. Chambers replied that maintaining the bonding requirement for the handyman category would help accomplish the goal. Representative Costello asked if Ms. Chambers referred to the original version. Ms. Chambers concurred. Representative Holmes OBJECTED. She stated that she would express OBJECTION to the CS as it might cost more money. 9:06:15 AM Senator Micciche spoke to the adoption of the CS. He stated that when a handyman advertised in Alaska, a minimum bond of $10 thousand was required. The cost of the bond was dropped to $5 thousand for the handyman category. A roll call vote was taken on the motion to adopt the CS, version Y. IN FAVOR: OPPOSED: Neuman, Thompson, Wilson, Costello, Edgmon, Gara, Guttenberg, Holmes, Munoz, Austerman, Stoltze The MOTION FAILED (11/0). The workdraft was not adopted. Representative Holmes expressed better understanding of the bill because of the CS. 9:09:12 AM Co-Chair Stoltze asked for amendments. Representative Costello discussed the two zero fiscal notes. 9:09:53 AM Representative Holmes MOVED to REPORT SB 193 (FIN) out of committee with individual recommendations and the accompanying fiscal notes. 9:10:20 AM AT EASE 9:10:33 AM RECONVENED Representative Holmes rescinded the prior motion to move the bill. She MOVED conceptual amendment 1, which added the effective date of January 1, 2015. There being NO OBJECTION, it was so ordered. 9:11:16 AM Representative Holmes MOVED to REPORT SB 193(FIN), as amended out of committee with individual recommendations and the accompanying fiscal notes. There being NO OBJECTION, it was so ordered. HCSSB 193(FIN) was REPORTED out of committee with a "do pass" recommendation and with one new zero fiscal note from the Department of Labor and Workforce Development and one new zero fiscal note from the Department of Commerce, Community and Economic Development. 9:21:55 AM AT EASE 9:36:17 AM RECONVENED