HB 97-SELF-STORAGE UNITS: LIENS; SALES  1:14:00 PM CHAIR VANCE announced that the first order of business would be HOUSE BILL NO. 97, "An Act relating to self-storage facilities for personal property, including vehicles and watercraft; distinguishing self-storage facility liens from another type of storage lien; and excluding self-storage liens from the treatment of certain unclaimed property." [Before the committee was CSHB 97(L&C).] CHAIR VANCE opened public testimony on HB 97. 1:14:39 PM GARY JENKINS, Owner, Space Unclaimed, testified during the hearing on CSHB 97(L&C). He opined that the bill language would set some bad precedents and directed attention to Sec. 34.35.620 [Denial of access; removal of unit property.], which he believed would enable and encourage bad behavior on the part of operators. He highlighted subsection (b) as particularly troublesome. He encouraged the committee to address structural errors in the bill before moving it forward. 1:19:40 PM NATHANIEL DYE, Juneau Self Storage; American Mini Storage, testified in support of HB 97. He opined that the bill would institute a minimum requirement statute while protecting consumers and business owners. 1:20:32 PM WILLIAM BREWER, Owner, Fairbanks Storage, testified during the hearing on HB 97. He stated that the bill was asking for a set of laws to ensure that all self-storage business owners were operating on the same terms. He assured the committee that storage owners do not want the legal authority to take possession of customers' things; instead, they were asking for the ability to turn over the unit to new paying customers and stop the loss of revenue from customers who do not abide by the rental agreement. He added that most of the time, abandoned units are full of trash and invaluable items. Furthermore, he indicated that email is the best form of notification, as mail is often returned undeliverable. 1:23:13 PM ELIZABETH MANN, General Manager, Alaska Mini Storage, testified in support of HB 97, as it would not challenge any existing policies or regulations. Without a lien law, she said, Alaska storage is subject to a "wild wild West" environment. She shared her belief that HB 97 would hold storage units to a higher standard, and in turn, gain greater respect from the community. 1:24:01 PM TYLER SCOTT, Public Self Storage, testified in support of HB 97. He said the bill would protect customers and bring an even playing field to operators. 1:25:00 PM LONNIE BICKFORD, Owner, AK Storage Center, testified in support of HB 97. He stated that the bill would protect [operators] and implement solid law that mirrored that of other states. He anecdotally reported that most possessions left behind are invaluable. 1:27:01 PM CHAIR VANCE closed public testimony on HB 97. 1:27:35 PM REPRESENTATIVE ALLARD moved to adopt Amendment 1 to CSHB 97(L&C), labeled 33-LS0392\S.6, Dunmire, 2/6/24, which read: Page 2, line 8: Delete "Notwithstanding AS 28.10.371, if" Insert "If" Page 2, line 9: Delete "superior" Insert "subordinate" Page 2, line 11: Delete "A storage lien is superior to a security interest perfected under AS 45.29." Page 2, line 12, following "except": Insert "a lien that was perfected before the date the rental agreement was signed or" CHAIR VANCE objected for the purpose of discussion. 1:27:47 PM REPRESENTATIVE MIKE PRAX, Alaska State Legislature, prime sponsor of CSHB 97(L&C), explained that Amendment 1 would make the facility owner's lien subordinate to any existing lien. REPRESENTATIVE SUMNER asked why the default notice in Section 34 and Section 35 was insufficient. In addition, he questioned how storage owners would be reimbursed for the storage of a vehicle if the vehicle owner was behind on payments. REPRESENTATIVE PRAX deferred to Mr. Bryant. 1:30:20 PM DANIEL BRYANT, Legal and Legislative Counsel, Self Storage Association, acknowledged the concern and explained that the goal was to find common ground with financial institutions in the state in the hopes to keep the legislation moving. REPRESENTATIVE SUMNER asked what would happen if a vehicle with a lien was towed to a tow yard, and whether "they" would be subordinate to the lien. REPRESENTATIVE PRAX answered no, the "towing company's storage lien" would be superior to the lender. REPRESENTATIVE SUMNER asked why there was stricter treatment for a situation into which people were voluntarily entering. REPRESENTATIVE PRAX said, "That's a good point." 1:33:02 PM REPRESENTATIVE CARPENTER pointed out that if an occupant stored a piece of equipment in the unit and stopped making payments on both, [the equipment] would revert back to the bank, and the bank would need to reclaim it from the storage unit. He said he did not see the need for Amendment 1. 1:34:31 PM REPRESENTATIVE ALLARD expressed concern about email being the only form of notification. She asked whether the bill sponsor would be amenable to adding [Certified Mail] as a form of contact. REPRESENTATIVE PRAX answered no, because the facility owner still accrues expenses through loss of income. REPRESENTATIVE SUMNER called a point of order, as the question was not germane to Amendment 1. CHAIR VANCE redirected attention back to Amendment 1. 1:36:39 PM REPRESENTATIVE C. JOHNSON said he had a problem with rushing amendments through without proper vetting. He moved to table Amendment 1. There being no objection, Amendment 1 was tabled. 1:37:59 PM The committee took an at-ease from 1:37 p.m. to 1:39 p.m. 1:39:45 PM CHAIR VANCE said after deliberation about consideration of amendments and further action on the bill, she wanted members to feel comfortable with the ability to review material. She announced that CSHB 97(L&C) would be held over.