HJR 20: AMEND N. AMERICAN FREE TRADE AGREEMENT Number 183 DAN AUSTIN, LEGISLATIVE AIDE TO REPRESENTATIVE KAY BROWN, offered to explain how the International Trade and Tourism (ITT) Committee substitute differed from the original version of HJR 20. He read from the resolution, which called for the federal government and partners in the North American Free Trade Agreement (NAFTA) to give consideration to the potential impact on Alaska's economy, labor force and environment. MR. AUSTIN explained that the CSHJR 20 (ITT) adds language on line 6 regarding NAFTA's ability to challenge states' rights. Lines 10 and 11, he said, delete language regarding banned chemicals and agricultural controls. Line 11 adds "state standards," he added. Page 2 of CSHJR 20 (ITT), he explained, adds a new "whereas" clause regarding jobs lost, and line 3 added language regarding dispute resolution. MR. AUSTIN continued his explanation of CSHJR 20 (ITT), noting a new "resolve" clause on line 5, requiring a vote within 90 days. Line 11 on page 2, he said, adds another resolve clause calling for the full partnership of the state. Number 290 REPRESENTATIVE KAY BROWN, PRIME SPONSOR OF HJR 20, told the committee that it was important to let the U.S. Congress know the state's concerns relating to NAFTA, to avoid having the state's powers usurped. REPRESENTATIVE JOE GREEN referred to a recent energy conference in Washington, D.C. and noted the overwhelming support voiced for NAFTA there. He commented that HJR 20 appears to say that Alaska does not like NAFTA. Number 321 REPRESENTATIVE BROWN responded that HJR 20 does not necessarily say that the state does not like NAFTA. Rather, she explained, it sends a message that energy-producing states will lose jobs as a result of NAFTA. She added that Mexico is a competitor as an oil producer, and pointed out that there are areas of NAFTA that need to be addressed to keep the agreement from having a negative impact on the state. Environmental standards, she added, were also in jeopardy of being compromised. She cited as an example the biodegradable plastic rings on soda and beer six-packs. REPRESENTATIVE BROWN said that as a result of NAFTA's policy of adopting the "lowest common denominator" in environmental standards, that environmental safeguard could be compromised, she said. Number 350 REPRESENTATIVE JOHN DAVIES referred to deleted language in CSHJR 20 (ITT) regarding the use of banned chemicals, and noted that it was his impression that the U.S. Department of Agriculture was not doing a good job of enforcing and implementing environmental safeguards. MR. AUSTIN replied that this was an area where negotiation was on-going. He explained that the Department of Agriculture had been instructed to keep strict restrictions, and that the real question was one of enforcement and inspection. He confirmed for Representative Davies that standards would be maintained. Number 380 REPRESENTATIVE BUNDE referred to the resolve clause that said the state legislature was a partner in dispute resolution, and raised the question of problems this might create with U.S. sovereignty, as well as potential confusion with a number of individual states involved in any one dispute. He suggested it might never get resolved with too many parties involved. REPRESENTATIVE BROWN explained that state involvement in dispute resolution would only occur when one state's laws are affected by activities associated with NAFTA. She agreed it would be cumbersome if all states were involved in resolving a dispute. REPRESENTATIVE DAVIES suggested clarifying that section to specify that the state would be involved and not the state legislature. Number 410 CHAIRMAN WILLIAMS announced the committee would now take testimony from the teleconference sites. JOHN C. BHEND, REPRESENTING HIMSELF, believed NAFTA was ill- conceived, and would result in jobs from Alaska and the rest of the U.S. being lost to Mexico. He suggested that the agreement won't help the conditions of workers in Mexico, and that it hurts the rights of working people. In addition, he cautioned that NAFTA undermines environmental standards and does not provide a means for enforcing standards. Other problems he saw with NAFTA included conflicts with states's sovereignty and the hampering of efforts to lower health care costs. Number 467 MR. BHEND cautioned that NAFTA would be an economic and social disaster as increasing numbers of jobs will be lost to Mexico. He noted that Canada's economy had suffered already, and he estimated that approximately 500,000 jobs will be lost from the United States. A ripple effect was likely to reach into the entire economy, he added. He stated his support of HJR 20, to ensure that Alaska benefits from and is not harmed by increased international trade. GENE DEKERLEGAND, KENAI PENINSULA CENTRAL LABOR COUNCIL, testified via teleconference from Kenai. He directed members' attention to his written testimony contained in their bill packets. (A copy of Mr. Dekerlegand's testimony may be found in the House Resources Committee Room, Capitol Room 124, and after the adjournment of the second session of the 18th Alaska State Legislature, in the Legislative Reference Library.) Number 532 JOAN BENNETT-SCHRAEDER, COALITION OF LABOR WOMEN, testified via teleconference from Kenai. She asked Representative Brown whether the various agencies and departments of the state had prepared reports to show the anticipated impact that NAFTA would have on Alaska. REPRESENTATIVE BROWN answered that she was not aware of any. She said she had worked with the Office of International Trade in preparing HJR 20, but added that the administration had not taken a position. MS. BENNETT-SCHRAEDER told the committee that the impact of NAFTA on the state is too important for agencies to remain neutral. CHAIRMAN WILLIAMS asked if any one else wished to testify on HJR 20. There was no response. REPRESENTATIVE DAVIES made a MOTION to move CSHJR 20 (ITT) with individual recommendations. CHAIRMAN WILLIAMS noted before taking a vote on the motion that the comments of Mr. Dekerlegand of Kenai would be included with the bill files as part of the record on HJR 20. Number 560 REPRESENTATIVE JEANNETTE JAMES recommended that the legislative research office be requested to provide more information on the impact NAFTA would have on Alaska. She also suggested the administration provide the legislature with a position on HJR 20 and on NAFTA. REPRESENTATIVE BROWN agreed that this work would be on-going during the legislative interim. She mentioned that Alaska had responded to a survey circulated among states regarding potential effects of NAFTA, but added that the survey dealt only with banking and securities' issues. She noted that it is difficult to determine the effects of something like NAFTA until the effects actually take place. There was no data base on which to gauge the effects, she said, although she was convinced NAFTA would affect a number of areas of the state's economy. Number 601 REPRESENTATIVE JAMES agreed that we would not know what NAFTA would do until it was done, but added that everyone needed to be aware of the potential effects. REPRESENTATIVE DAVIES underscored that there had been frustrations in attempts to establish local hire provisions, and that it was important to work now to avoid similar potential problems associated with NAFTA. Number 612 CHAIRMAN WILLIAMS referred to the motion before the committee to move CSHJR 20 (ITT) from the Resources committee with individual recommendations. He asked if there were any objections, and hearing none, the MOTION PASSED.