SB 75-COMMERCIAL VEHICLE LICENSING REQ'S  1:09:50 PM CO-CHAIR WOOL announced that the only order of business is SENATE BILL NO. 75, "An Act relating to a license to drive a commercial motor vehicle." 1:10:12 PM JOE PLESHA, Staff, Senator Mia Costello, Alaska State Legislature, introduced SB 75 on behalf of Representative Costello, sponsor. He explained that after speaking to stakeholders in the trucking industry, the sponsor identified two problems the industry is currently facing: 1) the demand for drivers in Alaska exceeds the available workforce, and 2) a federal statute on interstate freight mandates drivers must be age 21 or older to carry any freight that originated from outside of Alaska or that is bound for outside of Alaska. He said SB 75 intends to help address these issues. MR. PLESHA explained that SB 75 would change the minimum age requirement to obtain a commercial driver's license (CDL) from 19 years old to 18 years old, which would increase the pool of available drivers. Because of the 19-year-old age restriction for a commercial driver's license the industry cannot recruit young men and women coming out of high school. By lowering the age restriction for a commercial driver's license by a year, young adults who don't want to or who can't seek a higher education or go to trade school, could move directly into this line of work. Less than half of Alaska's students go to college currently. By lowering the age restriction from 19 to 18, an immediate career option that pays well can be offered to young people. This change will increase job opportunities for youth in Alaska and help Alaska's trucking industry meet its needs. MR. PLESHA further explained that SB 75 would also create a subsection that would authorize someone who is currently under 21, but 18 or older, to drive interstate freight or freight that has originated from outside of Alaska or is bound for outside of the state. Federal law currently restricts drivers across the country from carrying interstate freight if younger than 21. In Alaska this law is particularly cumbersome. He posed a scenario in which a trailer of cargo is shipped from Seattle to the Port of Alaska and is then moved through the Alaska Railroad to Fairbanks. Once that trailer is unloaded, federal law says that a 19-year-old driver cannot deliver that cargo two miles away because the cargo originated from outside of Alaska. MR. PLESHA argued that this overly cumbersome and illogical federal law restricts job opportunities for Alaska's young people and burdens the state's trucking industry. This new subsection would allow for Alaskans who are 18 and older and who otherwise fit the requirement necessary to obtain a commercial driver's license, to operate trucks with interstate freight dependent on a change in the federal statute. Including this subsection in SB 75 does two things. First, if enough states make this statute there will be pressure on the federal side to make the change on federal books as well. Second, if the federal statute does change, Alaska will be instantly ready to accommodate the new federal law. The sponsor views SB 75 as a potential jobs bill that is being proactive if the federal statute for interstate freight does change. 1:13:19 PM REPRESENTATIVE DRUMMOND offered her understanding that when freight comes to the Port of Anchorage from a port on the West Coast and is then transferred to vehicles within Alaska for moving around the state, a driver under the age of 21 cannot drive that truck. She speculated that would apply to everything because almost everything that comes into the state of Alaska comes from some place else. She asked whether an 18- or 19- year-old could drive freight that has been offloaded within the state and reloaded onto a different trailer if the freight is no longer in its original container from the outside port. MR. PLESHA stated he is unsure specifically when the cargo is no longer considered interstate freight. He deferred to Mr. Aves Thompson to provide an answer. He said that, currently, as described to him, if the freight comes straight from the Port of Alaska, it is still interstate freight, and if it is bound for outside of Alaska, even if it just being driven to Anchorage, it is interstate freight. He confirmed Representative Drummond is correct that most of the freight in Alaska is interstate freight because it comes from outside of Alaska. REPRESENTATIVE DRUMMOND offered her further understanding that if the freight is originating within Alaska but is heading Outside, it cannot be driven within the state by a 19-year-old driver even before it has left the state. MR. PLESHA confirmed that is correct. REPRESENTATIVE DRUMMOND stated she is trying to determine when a 19-year-old can drive freight within the state and whether that would be at the point where the freight is no longer in the original container from Outside. As a graphic designer, she said she buys printing paper which comes in a container from the Seattle area or other points. This paper gets unloaded and delivered to warehouses in Anchorage, and from the warehouses the paper is delivered throughout the state. She assumed that currently a 19-year-old driver could drive the freight from the warehouse even though that paper originated from Outside. MR. PLESHA deferred to Mr. Thompson to provide an answer, but said he believes it would be intrastate freight at that point. 1:16:43 PM REPRESENTATIVE RASMUSSEN asked whether there is any data that shows a difference in the number of car accidents that 18- and 19-year-olds have. MR. PLESHA replied that most of the data brackets 18- and 19- year-old drivers in the same group. A study by the Highway Loss Data Institute found that 19-year-olds get in accidents at higher rates than 18-year-olds, but he cannot speak as to why that is. He said there isn't a significant increase in danger in having 18-year-olds and 19-year-olds. REPRESENTATIVE RASMUSSEN offered her understanding that obtaining a commercial driver's license is expensive. She asked whether a person not in a trade program or a college course would have an opportunity to obtain a loan for getting a CDL. MR. PLESHA responded he is not familiar with any programs. He deferred to Mr. Thompson to provide an answer. 1:18:16 PM REPRESENTATIVE STORY asked how many other states have changed the law to let 18-year-olds drive. She further asked whether trucking companies would be able to use these drivers given insurance companies may not provide insurance until a driver is of a certain age or would charge a higher premium. MR. PLESHA answered that Hawaii, Nevada, and New Mexico require a person to be 21 years old to obtain a CDL for intrastate freight. Maine and South Dakota require a person to be 16 and the age for Mississippi is 17. All other states require a person to be 18 years old to obtain a commercial driver's license for intrastate freight. Regarding insurance, he said insurance companies do factor in age when determining risk. He assumed each company would make its own decision based on the responsibility of the driver as the company would want to ensure that these rigs are driven by responsible individuals. He surmised there would be an increase in risk the younger the driver under 21. REPRESENTATIVE RASMUSSEN commented that many insurance companies offer "good grace" discounts. Although she doesn't know if that is something that would apply for commercial purposes, she suggested that perhaps an 18-year-old fresh out of high school with a 3.0 grade point average could qualify for a good grade discount to show a responsibility. 1:20:46 PM CO-CHAIR WOOL inquired about the accident difference between 18, 19, and 21-plus. He surmised that as drivers get older there are less accidents and perhaps that is why the interstate law is 21-plus, especially when dealing with big commercial trucks. MR. PLESHA replied he doesn't have that data. He clarified that the data he previously cited wasn't referencing commercial driving, it was only referencing 18- and 19-year-old drivers across the country. He said he doesn't have any data on commercial drivers and accident rates. CO-CHAIR WOOL noted that most states are 18 years old. He asked about the history of Alaska's law for age 19 and how Alaska's law came up with age 19. He pointed out that kids still in high school could be 18. MR. PLESHA responded he doesn't know that history. REPRESENTATIVE TALERICO pointed out that to become approved for a CDL requires much more rigorous testing compared to a regular driver's test, which may help when it comes to insurance. Also, there are several different endorsements, such as Class A, Class B, and pulling double trailers. He further pointed out that not everybody passes their CDL test on the first try. He surmised that having a CDL endorsement and going through something that is much more rigorous, makes a difference. 1:23:57 PM CO-CHAIR WOOL opened invited testimony. 1:23:16 PM AVES THOMPSON, Executive Director, Alaska Trucking Association (ATA), testified in support of SB 75. He said ATA is a statewide organization representing the interests of its nearly 200 member companies from Barrow to Ketchikan. He continued: Freight movement is an essential element of our economy and impacts all of us each and every day. I'm here today to testify in support of SB 75. The ATA believes that lowering the eligibility age for an intrastate CDL will provide a path for a young man or woman to start on their way to a truck driving career. Both intrastate and interstate drivers are subject to the same driver qualifications, the same medical, safety, and equipment rules. The State of Alaska adopts the federal rules by reference in the Alaska Administrative Code. I might also call ... your attention to the fact that an 18-year-old can be issued a commercial pilot's license. Lowering of the intrastate driver age requirement to 18 allows a student to go from school right into training to be a professional truck driver. The CDL will not instantly create a professional truck driver but it will create an opportunity. We think this is a great opportunity for our young people as well as building a larger driver pool to help satisfy the increased demand for commercial vehicle drivers. Again, to reiterate, there is a commercial driver shortage which will only get worse if we begin a major project. The passage of SB 75 will help solve the problem in Alaska. Subsequently, when Congress passes a law lowering the interstate driving age, Alaska will be ready. The Alaska Trucking Association urges you to move SB 75 with favorable recommendations. 1:25:22 PM MR. THOMPSON addressed Representative Drummond's paper example and question about when freight becomes intra- or interstate. He explained that if Representative Drummond was to order paper for her business from her supplier and the supplier must special order it from Outside for delivery to her shop, that paper would still be interstate freight when it gets to her shop. If, on the other hand, she called her paper supplier and placed an order, and the supplier had that paper in stock, then that is intrastate freight because it has come into inventory and is not destined for any place other than that store; so moving the paper from that store to Representative Drummond's place is intrastate freight. REPRESENTATIVE DRUMMOND replied that that is approximately what she had assumed - once it is delivered to the paper warehouse in Anchorage and then distributed from that point, then it is intrastate freight. MR. THOMPSON posed a scenario in which Representative Drummond goes to a furniture store and sees a red chair but wants the chair in green. He explained that if the furniture store special ordered a green chair under her name to be delivered to her home, it would be interstate freight. Had she instead taken the red chair and the store delivered it to her home, it would be intrastate freight. 1:27:18 PM CO-CHAIR WOOL posed a scenario in which he orders a chair that is in stock at the Fairbanks furniture store. He surmised that the store's delivery truck could bring the chair to his house and a 19-year-old could deliver it. MR. THOMPSON replied correct. CO-CHAIR WOOL then posed a scenario in which he special orders a chair, the chair comes from a Seattle warehouse, and the chair goes to the same Fairbanks furniture store. He surmised that under current law the same 19-year-old driving the same delivery truck would be unable to deliver the chair. MR. THOMPSON responded correct, because the chair has Co-Chair Wool's name and delivery address on it. REPRESENTATIVE DRUMMOND remarked that that absolutely makes no sense. She opined that almost every stick of furniture or sheet of paper sold in Alaska is manufactured Outside and comes to Alaska. She offered her opinion that a special-order chair, once delivered to the furniture warehouse in Fairbanks, and then delivered to Co-Chair Wool's place, would become intrastate freight. She presumed, however, that if she ordered a pallet of goods from Ikea in Tacoma and Lyndon Transport brought those goods from the Anchorage port directly to her house, that freight would not have left Lyndon's purview and so would still be interstate freight when drop-shipped to her driveway. She said she thinks that once an item changes hands inside the state of Alaska and changes locations and is moved from one vehicle to another, or from an interstate vehicle to a warehouse or store in Alaska, then from that point it becomes intrastate freight because it can be delivered anywhere else in Alaska as long as it hasn't changed out of its original vehicle. MR. THOMPSON answered that Representative Drummond would have to take that scenario up with the U.S. Department of Transportation since it is the agency that makes the rules. 1:29:52 PM REPRESENTATIVE CLAMAN said the State of Alaska has adopted the federal regulations about commercial trucking into state regulation. He asked whether this means that today, even though Alaska's law says 19, everyone who is driving a commercial vehicle needs to be 21 because the federal regulation says 21. MR. THOMPSON replied no, it means that anyone who is transporting interstate freight must be 21. REPRESENTATIVE CLAMAN requested an example of intrastate freight with a tractor and trailer that is being moved within Alaska and that doesn't involve things that started in Seattle. MR. THOMPSON responded that examples of intrastate would be sand and gravel to a construction project, fuel from a fuel terminal to a delivery location, coal from the Healy plant to the University of Alaska Fairbanks - bulk products and things that are made in Alaska and delivered in Alaska. MR. THOMPSON added that once something is brought into a general inventory it loses its identity in federal parlance. Once it loses its identity it then becomes intrastate freight. CO-CHAIR WOOL, in response, offered his understanding that that is why the chair, if it's in a box with his name on it and it goes through the furniture store and is delivered by a local smaller truck, remains interstate - it wasn't incorporated into the general inventory. MR. THOMPSON answered correct. 1:32:00 PM REPRESENTATIVE CLAMAN noted that under federal Department of Transportation regulations there is a lot of drug and alcohol testing, particularly testing to marijuana. He asked if that would apply with the state driving regardless of whether it was intrastate or interstate. MR. THOMPSON responded that the same drug, alcohol, and other testing requirements apply to intrastate and interstate drivers. REPRESENTATIVE CLAMAN said he knows the aforementioned is not part of SB 75, but that he was curious to know. He offered his understanding that if SB 75 becomes law it would mean that drivers could get out of high school and start learning to drive coal trucks or gas delivery trucks at age 18; today, however, they cannot start driving until age 19. MR. THOMPSON replied correct. 1:33:25 PM CO-CHAIR WOOL inquired as to the likelihood of Congress changing the law to a lower age. He said it seems most of the other states have lowered their age and he doesn't think Alaska doing the same will add any impetus to changing the federal law. He inquired as to how the [proposed] federal law is going. MR. THOMPSON concurred that Alaska probably won't break that logjam. Currently before Congress, he said, is the Developing Responsible Individuals for a Vibrant Economy Act (DRIVE Act), which would provide for pilot programs for younger drivers, 18- year-olds. The Act would set minimum training requirements and set equipment requirements. For example, an automatic or automated assist transmission in the trucks, and several other things that ensure that the training is proper and adequate to meet the needs. He stated that a prudent common carrier business person is not going to send some kid out on the highway with a half-million-dollar tanker, or a $65,000 straight truck, without knowing in their mind that the driver is safe, is going to get the freight where it belongs, and is going to get home safely. Even though it may not be this year or next, he said he thinks the Act is coming. CO-CHAIR WOOL stated he can see the federal law requiring a driver to be 21 to drive across the [contiguous] United States, but that an 18-year-old could drive within a state. He asked whether that is something that would allow Alaska to have drivers under the age of 21 who drive only within Alaska. MR. THOMPSON answered that during its consideration, the [2015] Fixing America's Surface Transportation Act (FAST Act) included a provision that would have provided for a pilot program for 18- year-old drivers. The ATA approached Alaska's Congressional Delegation asking if an exemption could be carved out for Alaska and Hawaii because of the high rate of interstate freight. Most everything in Alaska has come from someplace else, which means it is all interstate freight when it is delivered. The intrastate field is limited to the bulk commodities such as coal and sand. The Alaska Congressional Delegation took a shot at it, but it didn't go anywhere. The American Trucking Association is now looking at this and is supporting the DRIVE Act, which will provide for 18-year-old drivers on a pilot program with the training requirements he previously mentioned. 1:37:08 PM REPRESENTATIVE RASMUSSEN inquired whether there is a limit on the number of times a person can take the CDL test in a given timeframe if he or she fails the first time. MR. THOMPSON replied he thinks there is a timeframe of five or ten days, but he isn't sure and shouldn't be quoted. REPRESENTATIVE RASMUSSEN asked whether there is a current requirement to have a diploma or General Educational Development (GED) credential as part of a person's CDL. MR. THOMPSON responded that there is not. 1:37:53 PM CO-CHAIR WOOL asked why the law is for age 19 as opposed to 18. MR. THOMPSON answered he doesn't know. He said ATA has asked the question of the Division of Motor Vehicles and there doesn't seem to be any history on why it is 19 instead of 18. CO-CHAIR WOOL inquired whether people in the military who drive big machines and trucks must be 19 and have a CDL or whether the military is a different program. MR. THOMPSON replied that a person driving a military vehicle on active duty is governed by military federal rules, which bear similarities but are not the same. CO-CHAIR WOOL asked whether this would be the same if they are driving big trucks on state roads. MR. THOMPSON responded they would still be on military rules. 1:39:05 PM REPRESENTATIVE DRUMMOND surmised this creates a lot of issues for local suppliers in Alaska. She posed a scenario in which a builder orders kitchen cabinets from Seattle through Spenard Builders Supply, the builder's name is on the cabinets when they arrive in Alaska, they are offloaded into the Spenard Builders facility in Anchorage, then they are reshipped to the construction site. She asked whether these kitchen cabinets are still considered interstate freight and must therefore be driven from the Spenard Builders facility to the construction by a 21- year-old driver. MR. THOMPSON answered yes. REPRESENTATIVE DRUMMOND posed a scenario in which the same builder buys kitchen cabinets that are already in Spenard Builders' inventory and from the same Outside supplier. She surmised these cabinets can be delivered by a 19-year-old driver within Alaska because the cabinets became part of Spenard Builders' general inventory before they were sold. MR. THOMPSON replied yes. REPRESENTATIVE DRUMMOND remarked that that sounds like a big headache for Spenard Builders Supply. She said she would like to hear from someone in the business as to whether this really is a problem right now and whether the legislature should be working on this in addition to this general license change. MR. THOMPSON responded that these interstate rules have been in place since the railroad days in the 1800s and were incorporated into the 1935 Interstate Commerce Act that set rules for trucking. Over the years the trucking industry has learned to live with the rules and knows that some loads are interstate, some loads are intrastate, and the interstate load must be driven by an interstate CDL driver. In the Spenard Builders Supply scenario there could be two trucks side by side - one is being delivered out of the inventory and one is the special- order delivery, so an interstate CDL is required for one and an intrastate CDL for the other. It doesn't make much sense but that's the way it is. 1:41:58 PM CO-CHAIR WOOL asked whether this law is enforced and whether an 18- or 19-year-old has ever been fined or cited for having a couch in his or her truck that originated in Seattle. MR. THOMPSON answered that if it's an intrastate carrier that is handling interstate loads, the likelihood is low. But if it is an interstate carrier that is regulated by the Federal Motor Carrier Safety Administration, that kind of activity might be caught in an audit. He added that there is rarely any kind of roadside enforcement of that rule. CO-CHAIR WOOL surmised that if Spenard Builders had a couple of trucks going out on any particular day, one wouldn't be labeled interstate and the other intrastate and that one driver must drive a particular truck. MR. THOMPSON replied he thinks that Spenard Builders does [keep them separate], but occasionally a mistake might be made. 1:43:10 PM REPRESENTATIVE STORY observed from the bill's zero fiscal note that only 33 of the [31,267] CDL drivers in Alaska were issued to applicants under the age of 21. CO-CHAIR WOOL surmised that most drivers at most companies are probably over 21 and that perhaps some companies have a policy of a minimum age. He inquired whether trucking companies often have an age policy in place. MR. THOMPSON responded that often it is driven by the insurance company. He said some insurance companies like drivers older than 25, some like them older than 30, and some like them younger. The premiums are probably a little higher the younger the driver. It is a business decision made by the motor carrier as to whether he or she is willing to pay that because a driver is needed. 1:44:42 PM DON ETHERIDGE, Lobbyist, Alaska AFL-CIO, testified in support of SB 75. He stated that many of his organization's apprenticeship programs require a CDL in the first 2,000 hours. If a company has someone just out of high school who joins an apprenticeship program and reaches that 2,000 hours, he or she is on hold until getting that CDL and is not allowed to move forward with any of his or her training. That is a main reason why the Alaska AFL- CIO supports the bill - so apprentices can get through their apprenticeship training with their CDLs and continue with their training that way. MR. ETHERIDGE shared that in a previous life he was chairman of the board for Saga, a training group for at-risk youth that is very helpful at keeping kids busy, out of trouble, and in school. Saga works with the kids in housebuilding, trails work, and such. This bill would give some of these kids a life lesson. Many of these kids go back to school to get their diplomas after working for a year and many are put into apprenticeship programs and begin a career. MR. ETHERIDGE said another good thing about kids with a CDL is that if they are working the CDL they must be under random drug testing. Knowing that they could lose their CDL keeps many of these kids paying attention to what is going on. A CDL isn't an easy license to get - it takes time, work, and study to get a CDL. He has tutored many people in getting their CDLs and he has carried a CDL for about 25 years. 1:48:00 PM REPRESENTATIVE CLAMAN stated he believes SB 75 is a good bill and an illumination of the complex world in which trucking goes on. He posited that all kinds of materials are crossing state borders in the Lower 48; for example, all kinds of materials would be crossing the border between Portland, Oregon, and Washington. So, the big change would come with a change in the federal law. He concurred that an 18-year-old getting his or her CDL is going to be under much more rigorous training and that much more careful decisions will be made by the owner of that equipment before an 18-year-old is allowed to drive the equipment. He related that years ago he was driving a passenger vehicle on one of the roads where Usibelli Coal Mine drives enormous trucks and he cannot imagine that the mine would put anyone who is 18 years old into driving those massive dump trucks without being 100 percent confident that that 18-year-old knew exactly what he or she was doing. He posited that there is a difference in risk for car drivers under the age of 25, but that for those holding CDLs the age difference probably doesn't show much meaningful difference in risk because the training is much more extensive. He said he is therefore very comfortable with what SB 75 does and applauds the sponsor. REPRESENTATIVE STORY stated that she, too, has been reassured about the requirements of having a CDL and that it would be good for employment for younger people and good for the business. REPRESENTATIVE TALERICO echoed Representative Claman's remarks. He shared that in the past [while working for Usibelli Coal Mine] he provided training for quite a few people under the age of 20. He explained that trucks are easier to move around because most have automatic transmissions, but a little more difficult because they are anywhere from 12-19 feet wide. He pointed out that 18- and 19-year-olds have a much faster response time than he now does, which is critical when handling equipment like that. It is much different than a passenger vehicle. When he was 19 driving a car was fun, but hauling coal and dirt was his job so there was a different mental aspect to it because there was a responsibility. 1:51:44 PM CO-CHAIR WOOL opened public testimony. After ascertaining that no one wished to testify he closed public testimony. CO-CHAIR WOOL stated he thinks SB 75 is a good bill. It would get people into the job world sooner while in high school or just out of high school instead of waiting. The 21-year-old interstate limitation isn't necessarily [the legislature's] battle to fight. He will let the insurance companies handle who gets into more accidents at what age. 1:52:55 PM The committee took a brief at-ease. 1:52:55 PM REPRESENTATIVE CLAMAN moved to report SB 75 out of committee with individual recommendations and the accompanying zero fiscal note. There being no objection, SB 75 was reported from the House Transportation Standing Committee.