HB 251-VEHICLE LIENS/TOWING/STORAGE/TRANSPORT  8:08:03 AM CHAIR LYNN announced that the first order of business was HOUSE BILL NO. 251, "An Act relating to liens on vehicles; and providing for an effective date." 8:08:58 AM REPRESENTATIVE JAY RAMRAS, Alaska State Legislature, as sponsor of HB 251, stated that towing companies are often called upon by emergency services to tow a vehicle, but don't always get paid for their services. He explained that sometimes "powers greater than they are" have the ability to get the vehicle out of the impound yard. The proposed legislation would "put them before the lien holder." 8:10:11 AM REPRESENTATIVE GATTO described a hypothetical situation in which he has sold his car to someone, with the understanding that that person will make a certain monthly payments for a certain amount of time. He said, "I fully expect that if there ... [are] any extra liens on it, they would be secondary to me, because that was the original lien." He said if the buyer still owes $2,000 and the vehicle is towed to a lot at a cost of $100 and sits for two months at a rate of $100 a day, "I have essentially extinguished all of my legitimate ownership of the vehicle ..., and instead it went to a towing company." He concluded, "That's my fear of what will happen to an ordinary guy who is first in line, and then somebody, by this law, can say, 'I can displace you.'" 8:11:29 AM REPRESENTATIVE RAMRAS stated his personal belief that overwhelmingly, vehicles are owned by banks and often predatory lenders, and rarely does a transaction occur that includes time payments between two individuals where a tow charge "comes between the person to whom the funds are owed." 8:13:03 AM REPRESENTATIVE GATTO said he understands, but wanted to see what the response would be. He said this is a matter of proportions. He stated, "So, if this is an incidental amount of loss to a corporation, but a major loss to an ordinary business owner who's just got his neck above water and that's all, then I understand." 8:13:53 AM REPRESENTATIVE GRUENBERG said he is prepared to move the bill out of committee, with the understanding that the next committee of referral will address issues such as being careful of the rights of financial institutions. He said part of the problem is in another section of Title 28, which gives a towing company only a possessory lien, and that requires the towing company to keep possession of [the vehicle] to protect itself. He said it may be necessary to rework that part of Title 28. Representative Gruenberg said otherwise what Representative Gatto said is correct and it is "the little guy who owns the car" who will pay the consequences. 8:15:19 AM REPRESENTATIVE JOHNSON mentioned other recourses, such as small claims and garnishing the permanent fund dividend. He concluded, "So, I don't know how big an issue this really is." 8:16:04 AM REPRESENTATIVE GRUENBERG said in his part of town there are a lot of poor people. Sometimes a person gets pulled over for a burned out tail light and the police find out the person does not have insurance. The vehicle then goes to the towing lot and sits there because the owner does not have the money to get it out. He said this has been a concern of his for a long time. 8:16:23 AM REPRESENTATIVE GRUENBERG moved to report HB 251 out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HB 251 was reported out of the House State Affairs Standing Committee.