SB 203-OFFICE OF ADMINISTRATIVE HEARINGS  VICE CHAIR OGAN announced SB 203 to be up for consideration. MR. DAVE STANCLIFF, Regulation Review Committee, said the basic goals of SB 203 are to set up a model that will grow and provide more efficient and fair hearings for those who require adjudications in the state administrative process. Secondly, it sets up standards and protections for hearing officers statewide. Since the officers work for the agencies that promulgate and enforce the regulations, a more independent approach is in order and this bill provides protection to hearing officers from agency influence from both inside and outside the central model - and influence from the legislature. It also establishes a higher standard of conduct for the process. In effect, a model is created and outside that model, people have a more independent status. Last, the bill establishes a time limit for people who have been caught up in the adjudication process for years. He said they have worked extensively with administration, legislators and organizations. VICE-CHAIR OGAN said that all three powers are under one branch of government - the power to carry forth the laws, investigate, prosecute and adjudicate. MR. STANCLIFF commented that judges are sworn to uphold the administrative law until they are given the independent standards of conduct that due process calls for. CHAIR SEEKINS arrived at 2:13 p.m. SENATOR THERRIAULT asked Mr. Stancliff to go over the amendments. MR. STANCLIFF passed the amendments out to the committee and stated that at every step of the way they worked with the administration in consideration of any changes in the amendments and that they had been extremely productive and cooperative. The first amendment on page 3, line 15, is a housekeeping amendment; amendment 2 on page 8, line 1, is substantive. Currently, a hearing officer has 90 days after the date the case is assigned to prepare a proposed decision. However, they realized that if the agency didn't cooperate with the hearing officer, he might not get the material needed to even get the hearing going within 90 days so it was changed to 120 days. However, they deleted line 7 on page 8, which says: If the proposed decision is not timely issued, the agency decision that is subject to the hearing is the final agency decision and a party requesting the hearing may appeal straight to Superior Court. It sounds good in principal, but it doesn't work well in practice for two reasons. The first reason is, if the hearing isn't even conducted, all of a sudden the only record the petitioner has to build their case on is a bad record or none at all. The administration asked for the leeway to trust that the new model would work properly and to delete that type of hammer. On page 8, line 21, it says the hearing officer will have 120 days and then submits the hearing to the commissioner or agency. The commissioner would have 30 days to decide whether to take action or not. That bar has been raised so that when the commissioner takes action, they have to very explicitly say why and make it a matter of the public record - something that isn't necessarily occurring now. Also, currently, if the commissioner remands the case back to the agency, it doesn't say how long it can stay there, which has been a problem. So, he fixed a time of 60 days starting from the time the hearing officer hears and proposes the decision. Within that 60 days, the commissioner has up to 30 of them to decide what to do or to do nothing; and if it's remanded back, there's an additional 30 days for the agency to complete and issue a final decision. That puts the total clock under this amendment at 182 days. MR. STANCLIFF said he contacted Judge Belcher in Colorado, a nationally recognized expert, on what he felt was the outside time his central panel ever had to use and he answered 180 days. "So, we're in line with a model that is working very well nationally and the administration has every option and flexibility within this model to speed parts of it up..." The new model has a requirement to keep good records, but they accidentally asked them to keep records of not only what they do, but records of whatever the agency does, too. This is not only duplicative, but it's going to make them into record keepers rather than processors and adjudicators. Amendment 3 clarifies that. SENATOR THERRIAULT moved to adopt the three amendments, S.2, S.3 and S.4, as one amendment. There were no objections and it was so ordered. 23-LS0903\S.2 Cook 12/11/03 A M E N D M E N T 1 OFFERED IN THE SENATE TO: CSSB 203(STA) Page 3, line 15, following "year": Insert "the results of the survey along with" 23-LS0903\S.3 Cook 12/11/03 A M E N D M E N T 2 OFFERED IN THE SENATE TO: CSSB 203(STA) Page 8, line 1: Delete "immediately" Insert ", within two working days," Page 8, lines 4 - 5: Delete "within 90 days after the date a case is assigned for hearing" Insert "within 120 days after the date the agency received the request for a hearing" Page 8, lines 7 - 10: Delete "If the proposed decision is not timely issued, the agency decision that is the subject of the hearing is the final agency decision and the party requesting the hearing may appeal from that decision to the superior court or as otherwise provided by law for appeals of final agency decisions." Insert "The hearing officer shall immediately submit the proposed decision to the agency." Page 8, line 21, following "proceedings;": Insert "the hearing officer shall complete the additional work on the case and return it to the agency within 60 days after the date the original proposed decision of the hearing officer was submitted to the agency by the hearing officer;" 23-LS0903\S.4 Cook 12/11/03 A M E N D M E N T 3 OFFERED IN THE SENATE TO: CSSB 203(STA) Page 9, lines 24 and 25: Delete all material. Insert "acquire and organize records relating to administrative hearings of the office. The records must include information," Page 9, line 28, following "records.": Insert "The records shall be made available to the public." MR. STANCLIFF noted a letter from the Disability Law Center of Alaska that brought to their attention that federal law requires that a state educational agency or a local education agency conduct the hearings under their particular statutes having to do with children with disabilities as it applies to education. However, they said they would be willing to work with him to see if by keeping them in this bill, they rub up against the federal statute. He said they would work with the AG's office to correct that if it is a problem. SENATOR FRENCH asked what happens when the hearing officer doesn't return the decision within a specified time. Could they go to court? MR. STANCLIFF responded that the amendment they just adopted removes the provision to go to court. SENATOR FRENCH asked if there was any time frame for them to get through before being able to go to court. MR. STANCLIFF answered there is not. SENATOR FRENCH asked whether PFD disputes are in this act or whether they stand alone. MR. ANDY HEMENWAY, Department of Administration Hearing Officer, answered the PFD hearings will not be under this act. SENATOR FRENCH asked about fishery laws and regulations. MR. STANCLIFF said they will not be in administrative hearings. The RCA is not included and neither are oil and gas taxation issues. The idea is if the model works well, it could eventually evolve to be the total clearing house. Only one category of taxation relates to oil and gas, the oil and gas property tax on page 5, lines 12 & 13, of the CS, which are presently being heard by a hearing officer within the Department of Revenue. There are two types of issues that arise under that statute. One type is whether or not the property in question is in fact taxable property for purposes of those statutes. Those questions would go to this central panel [by a hearing officer in the Department of Revenue]. The other question that arises under those provisions of law is how much is the property worth, what is the amount of the tax. Those issues under current practice are decided by the State Assessment Review Board, which is essentially a collection of...municipal assessors, basically....Those cases are now being conducted by that board, not by hearing officers. They're not delegated out and under the current legislation...they would continue to be conducted by the State Assessment Review Board. SENATOR FRENCH asked if he knew how long it takes to get through the system now. MR. STANCLIFF replied they provided a full report that lists every hearing function and how long they have taken previously. He said that the new officers would not be classified employees, but they would be partially exempt and have the same guidance that Division of Election employees have under AS 39. However, they cannot be summarily removed. SENATOR FRENCH asked if this sets a 90-day drop-dead period for resolving the hearings. MR. STANCLIFF replied no longer and that the amendment they just adopted gives 120 days to the hearing officer to produce a product and 180 days total from the time someone requests a hearing that the agency has to provide a final decision. SENATOR FRENCH asked if any hearing bodies were consistently exceeding that period of time. MR. STANCLIFF said there is a list in excess of 50 - 100 cases that won't even get heard for a year or more. He said there are horror stories, but this bill is not targeting those. SENATOR FRENCH asked if someone that has a grievance and goes into a hearing officer, but has nothing happen in 180 days is automatically shunted off to court. MR. STANCLIFF replied there is no automatic shunt, but a case could be made with a competent attorney to the courts that the deadline was exceeded. MR. HEMENWAY added that there is some concern about the consequence of having the ability to go straight into court with a "half baked" record. The intent is that the chief hearing officer would create internal guidelines to govern how long will it take to process cases from each different agency so you can establish appropriate time frames for any type of case that might come along and that those will be included in the performance evaluation for the hearing officers. The intent here is...to make the consequence appropriately considered in the personnel process for the hearing officer since they are the ones charged with getting the work done in a timely manner. CHAIR SEEKINS said he would hold the bill for further testimony in future meetings.