HOUSE JUDICIARY STANDING COMMITTEE May 5, 1998 1:10 p.m. MEMBERS PRESENT Representative Joe Green, Chairman Representative Con Bunde, Vice Chairman Representative Brian Porter Representative Norman Rokeberg Representative Jeannette James Representative Eric Croft Representative Ethan Berkowitz MEMBERS ABSENT All members present COMMITTEE CALENDAR CS FOR SENATE BILL NO. 254(FIN) "An Act relating to the exemption from levy, execution, garnishment, attachment, or other remedy for the collection of debt as applied to a permanent fund dividend." - MOVED CSSB 254(FIN) OUT OF COMMITTEE CS FOR SENATE BILL NO. 329(JUD) am "An Act relating to the regulation authority, exemptions, and definitions of the Alaska Business License Act." - MOVED HCSCSSB 329(JUD) OUT OF COMMITTEE CS FOR SENATE BILL NO. 114(JUD) AM "An Act relating to contributions from employee compensation for political purposes; and prohibiting certain kinds of discrimination against employees for political purposes." - MOVED CSSB 114(JUD) AM OUT OF COMMITTEE CS FOR SENATE BILL NO. 158(L&C) "An Act relating to motor vehicle liability insurance covering a person who has had the person's driver's license revoked for possession or consumption of alcohol while under 21 years of age." - MOVED HCSCSSB 158(L&C) OUT OF COMMITTEE CS FOR SENATE BILL NO. 319(RLS) "An Act relating to arbitration; amending Rules 57(a) and 77(g), Alaska Rules of Civil Procedure; and providing for an effective date." - HEARD AND HELD CS FOR SENATE BILL NO. 274(FIN) am "An Act relating to fees for probation and parole; relating to eligibility for a permanent fund dividend for persons convicted of and incarcerated for certain offenses; and relating to notice requirements relating to appropriations from the permanent fund dividend fund to the office of victims' rights." - HEARD AND HELD CS FOR SENATE BILL NO. 232(JUD) "An Act relating to electronic signatures, electronic records, requirements for records, and the reproduction of public records." - MOVED CSSB 232(JUD) OUT OF COMMITTEE * HOUSE BILL NO. 444 "An Act relating to paternity determinations; relating to extinguishment of child support arrearages and public assistance debt and to reimbursement of payments already made to the state on behalf of the child when paternity is administratively disestablished or a court determination of paternity is vacated; and amending Rules 60 and 90.3(h), Alaska Rules of Civil Procedure." - HEARD AND HELD (* First public hearing) PREVIOUS ACTION BILL: SB 254 SHORT TITLE: LEVY ON PERMANENT FUND DIVIDEND SPONSOR(S): LABOR & COMMERCE Jrn-Date Jrn-Page Action 1/23/98 2278 (S) READ THE FIRST TIME - REFERRAL(S) 1/23/98 2278 (S) L&C, JUD 1/29/98 (S) L&C AT 1:30 PM FAHRENKAMP RM 203 1/29/98 (S) MINUTE(L&C) 1/29/98 (S) MINUTE(RES) 2/03/98 (S) L&C AT 1:30 PM FAHRENKAMP RM 203 2/05/98 (S) L&C AT 1:30 PM FAHRENKAMP RM 203 2/05/98 (S) MINUTE(L&C) 2/10/98 (S) L&C AT 1:30 PM FAHRENKAMP RM 203 2/10/98 (S) MINUTE(L&C) 2/11/98 2479 (S) L&C RPT CS 2DP 1AM NEW TITLE 2/11/98 2479 (S) DP: KELLY, MACKIE AM: LEMAN 2/11/98 2480 (S) ZERO FISCAL NOTE TO SB (REV) 2/12/98 2496 (S) ZERO FISCAL NOTE TO CS (REV) 2/16/98 (S) JUD AT 1:30 PM BELTZ ROOM 211 2/16/98 (S) MINUTE(JUD) 2/17/98 2542 (S) JUD RPT CS 1DP 3NR NEW TITLE 2/17/98 2542 (S) DP: TAYLOR NR: PARNELL, MILLER, PEARCE 2/17/98 2542 (S) FISCAL NOTE TO CS (REV) 2/17/98 2542 (S) FIN REFERRAL ADDED 3/11/98 (S) FIN AT 9:30 AM SENATE FINANCE 532 3/12/98 (S) RLS AT 12:00 PM FAHRENKAMP RM 203 3/12/98 (S) MINUTE(RLS) 3/12/98 2840 (S) FIN RPT CS 5DP 1NR NEW TITLE 3/12/98 2840 (S) DP: SHARP, PHILLIPS, TORGERSON 3/12/98 2840 (S) DONLEY, PEARCE NO REC: ADAMS 3/12/98 2840 (S) ZERO FN TO CS (REV) 3/13/98 2860 (S) RULES TO CALENDAR 3/18/98 3/18/98 2882 (S) READ THE SECOND TIME 3/18/98 2883 (S) FIN CS ADOPTED UNAN CONSENT 3/18/98 2883 (S) THIRD READING 3/19 CALENDAR 3/19/98 2898 (S) READ THE THIRD TIME CSSB 254(FIN) 3/19/98 2898 (S) PASSED Y14 N1 E5 3/19/98 2899 (S) GREEN NOTICE OF RECONSIDERATION 3/20/98 2924 (S) RECONSIDERATION NOT TAKEN UP 3/20/98 2924 (S) TRANSMITTED TO (H) 3/23/98 2702 (H) READ THE FIRST TIME - REFERRAL(S) 3/23/98 2702 (H) L&C, JUDICIARY 4/29/98 (H) L&C AT 3:15 PM CAPITOL 17 4/30/98 3361 (H) L&C RPT 5DP 1NR 4/30/98 3362 (H) DP: COWDERY, KUBINA, RYAN, HUDSON, 4/30/98 3362 (H) ROKEBERG; NR: BRICE 4/30/98 3362 (H) SENATE ZERO FISCAL NOTE (REV) 3/12/98 5/05/98 (H) JUD AT 1:00 PM CAPITOL 120 BILL: SB 329 SHORT TITLE: INVESTMENT CLUB LICENSE EXEMPTION SPONSOR(S): LABOR & COMMERCE BY REQUEST Jrn-Date Jrn-Page Action 2/19/98 2576 (S) READ THE FIRST TIME - REFERRAL(S) 2/19/98 2576 (S) L&C, JUD 3/12/98 (S) L&C AT 1:30 PM FAHRENKAMP RM 203 3/12/98 (S) MINUTE(L&C) 3/13/98 2859 (S) L&C RPT 1DP 2NR 3/13/98 2859 (S) DP: LEMAN NR: MACKIE, HOFFMAN 3/13/98 2859 (S) FISCAL NOTE (DCED) 3/19/98 2895 (S) ZERO FISCAL NOTE (DCED) 3/20/98 2924 (S) FIN REFERRAL ADDED AFTER JUD 3/27/98 (S) JUD AT 1:30 PM BELTZ ROOM 211 3/30/98 (S) JUD AT 1:45 PM BELTZ ROOM 211 3/30/98 (S) MINUTE(JUD) 3/31/98 3068 (S) JUD RPT CS 1DP 3NR NEW TITLE 3/31/98 3068 (S) DP: TAYLOR; NR: ELLIS, PARNELL, MILLER 3/31/98 3068 (S) PREVIOUS ZERO FN APPLIES (DCED) 4/02/98 3117 (S) FIN REFERRAL WAIVED 4/27/98 (S) RLS AT 12:10 PM FAHRENKAMP RM 203 4/27/98 3518 (S) RULES TO CALENDAR 4/27/98 4/27/98 3520 (S) READ THE SECOND TIME 4/27/98 3520 (S) JUD CS ADOPTED UNAN CONSENT 4/27/98 3520 (S) AM NO 1 OFFERED BY LEMAN 4/27/98 3520 (S) AM NO 1 ADOPTED UNAN CONSENT 4/27/98 3520 (S) ADVANCED TO THIRD READING UNAN CONSENT 4/27/98 3520 (S) READ THE THIRD TIME CSSB 329(JUD) AM 4/27/98 3521 (S) PASSED Y20 N- 4/27/98 3527 (S) TRANSMITTED TO (H) 4/28/98 3302 (H) READ THE FIRST TIME - REFERRAL(S) 4/28/98 3302 (H) JUDICIARY 5/05/98 (H) JUD AT 1:00 PM CAPITOL 120 BILL: SB 114 SHORT TITLE: EMPLOYEES: POLITICAL CONTRIB & ACTIVITIES SPONSOR(S): JUDICIARY Jrn-Date Jrn-Page Action 3/05/97 572 (S) READ THE FIRST TIME - REFERRAL(S) 3/05/97 572 (S) JUDICIARY 3/19/97 (S) JUD AT 1:30 PM BELTZ ROOM 211 3/19/97 (S) MINUTE(JUD) 3/26/97 (S) JUD AT 1:30 PM BELTZ ROOM 211 3/26/97 (S) MINUTE(JUD) 4/01/97 916 (S) JUD RPT CS 2DP 1NR SAME TITLE 4/01/97 916 (S) DP: TAYLOR, MILLER; NR: PEARCE 4/01/97 916 (S) FNS TO SB (ADM-2, LAW) 4/01/97 916 (S) ZERO FN TO SB (LABOR) 4/09/97 1049 (S) FISCAL NOTE TO CS (LAW) 4/23/97 1446 (S) PREVIOUS FNS APPLY TO CS (ADM-2) 4/01/97 916 (S) FIN REFERRAL ADDED 5/06/97 (S) FIN AT 8:00 AM SENATE FINANCE 532 5/07/97 (S) FIN AT 8:30 AM SENATE FINANCE 532 5/08/97 (S) FIN AT 8:00 AM SENATE FINANCE 532 5/08/97 (S) MINUTE(FIN) 5/08/97 (S) MINUTE(RLS) 5/08/97 1815 (S) FIN RPT 4NR (JUD)CS 5/08/97 1815 (S) NR: SHARP, PHILLIPS, PARNELL, TORGERSON 5/08/97 1815 (S) PREVIOUS FNS (LAW, ADM-2) 5/08/97 1815 (S) PREVIOUS ZERO FN (LABOR) 5/08/97 1842 (S) RULES TO SUPP CAL 1 & 1NR 5/8/97 5/08/97 1843 (S) READ THE SECOND TIME 5/08/97 1843 (S) JUD CS ADOPTED UNAN CONSENT 5/08/97 1843 (S) AM NO 1 ADOPTED Y11 N7 E1 A1 5/08/97 1845 (S) THIRD READING 5/9 CALENDAR 5/09/97 1906 (S) READ THE THIRD TIME CSSB 114(JUD) AM 5/09/97 1906 (S) RTN TO 2ND TO RESCIND ACTION UNAN CON 5/09/97 1906 (S) RESCINDED ACTION ADPTG AM 1 Y10 N9 E1 5/09/97 1907 (S) AM NO 1 FAILED Y9 N10 E1 5/09/97 1907 (S) AUTOMATICALLY IN THIRD READING 5/09/97 1907 (S) RETURN TO SECOND FOR AM 2 UNAN CONSENT 5/09/97 1907 (S) AM NO 2 FAILED Y9 N10 E1 5/09/97 1908 (S) AUTOMATICALLY IN THIRD READING 5/09/97 1909 (S) FAILED PASSAGE Y10 N9 E1 5/09/97 1909 (S) TAYLOR NOTICE OF RECONSIDERATION 5/09/97 1909 (S) RECON TAKEN UP SAME DAY UNAN CONSENT 5/09/97 1909 (S) RETURN TO RLS COMMITTEE 5/10/97 (S) MINUTE(RLS) 5/10/97 1962 (S) CALENDAR 5/10/97 5/10/97 1962 (S) RECON TAKEN UP - IN THIRD READING 5/10/97 1962 (S) PASSED ON RECONSIDERATION Y11 N8 E1 5/10/97 1971 (S) TRANSMITTED TO (H) 5/10/97 1801 (H) READ THE FIRST TIME - REFERRAL(S) 5/10/97 1801 (H) JUDICIARY, FINANCE 3/20/98 2687 (H) WITHDRAW FROM CMTE FLD Y2 N37 E1 5/01/98 (H) JUD AT 1:00 PM CAPITOL 120 5/01/98 (H) MINUTE(JUD) BILL: SB 158 SHORT TITLE: INSURANCE CHANGES FOR DR. LIC REVOC. SPONSOR(S): JUDICIARY BY REQUEST Jrn-Date Jrn-Page Action 4/02/97 935 (S) READ THE FIRST TIME - REFERRAL(S) 4/02/97 935 (S) L&C, JUD 2/05/98 (S) L&C AT 1:30 PM FAHRENKAMP RM 203 2/05/98 (S) MINUTE(L&C) 2/19/98 (S) L&C AT 1:30 PM FAHRENKAMP RM 203 2/19/98 (S) MINUTE(L&C) 2/20/98 2591 (S) L&C RPT CS 1DP 4NR NEW TITLE 2/20/98 2591 (S) DP: KELLY 2/20/98 2591 (S) NR: MACKIE, HOFFMAN, MILLER, LEMAN 2/20/98 2591 (S) ZERO FNS TO SB & CS (ADM, DCED) 3/02/98 (S) JUD AT 1:30 PM BELTZ ROOM 211 3/02/98 (S) MINUTE(JUD) 3/03/98 (S) RLS AT 11:35 AM FAHRENKAMP RM 203 3/03/98 (S) MINUTE(RLS) 3/03/98 2715 (S) JUD RPT 2DP 1NR (L&C)CS 3/02/98 2715 (S) DP: TAYLOR, MILLER NR: PARNELL 3/02/98 2715 (S) PREVIOUS ZERO FNS (DCED, ADM) 3/05/98 2749 (S) RULES TO CALENDAR 3/5/98 3/05/98 2750 (S) READ THE SECOND TIME 3/05/98 2751 (S) L&C CS ADOPTED UNAN CONSENT 3/05/98 2751 (S) ADVANCED TO THIRD READING UNAN CONSENT 3/05/98 2751 (S) READ THE THIRD TIME CSSB 158(L&C) 3/05/98 2751 (S) PASSED Y14 N6 3/05/98 2759 (S) TRANSMITTED TO (H) 3/06/98 2533 (H) READ THE FIRST TIME - REFERRAL(S) 3/06/98 2533 (H) L&C, JUDICIARY 4/01/98 (H) L&C AT 3:15 PM CAPITOL 17 4/03/98 (H) L&C AT 3:15 PM CAPITOL 17 4/06/98 2885 (H) L&C RPT HCS(L&C) 4DP 1NR 4/06/98 2886 (H) DP: COWDERY, KUBINA, RYAN, ROKEBERG; 4/06/98 2886 (H) NR: BRICE 4/06/98 2886 (H) 2 SENATE ZERO FNS (ADM, DCED) 2/20/98 5/01/98 (H) JUD AT 1:00 PM CAPITOL 120 5/01/98 (H) MINUTE(JUD) BILL: SB 319 SHORT TITLE: ARBITRATION SPONSOR(S): SENATOR(S) PHILLIPS Jrn-Date Jrn-Page Action 2/16/98 2528 (S) READ THE FIRST TIME - REFERRAL(S) 2/16/98 2528 (S) L&C, JUD 3/10/98 (S) L&C AT 3:45 PM FAHRENKAMP RM 203 3/10/98 (S) MINUTE(L&C) 3/12/98 (S) L&C AT 1:30 PM FAHRENKAMP RM 203 3/12/98 (S) MINUTE(L&C) 3/13/98 2859 (S) L&C RPT CS 3NR SAME TITLE 3/13/98 2859 (S) NR: LEMAN, MACKIE, HOFFMAN 3/13/98 2859 (S) ZERO FISCAL NOTE TO SB & CS (LAW) 4/01/98 (S) JUD AT 1:30 PM BELTZ ROOM 211 4/01/98 (S) MINUTE(JUD) 4/02/98 3112 (S) JUD RPT 1DP 4NR (L&C) CS 4/02/98 3112 (S) DP: TAYLOR; NR: ELLIS, PARNELL, 4/02/98 3112 (S) MILLER, PEARCE 4/02/98 3112 (S) PREVIOUS ZERO FN (LAW) 4/09/98 (S) RLS AT 11:15 AM FAHRENKAMP RM 203 4/09/98 (S) MINUTE(RLS) 4/15/98 3262 (S) RULES TO CALENDAR 4/15/98 4/15/98 3272 (S) READ THE SECOND TIME 4/15/98 3272 (S) L&C CS ADOPTED UNAN CONSENT 4/15/98 3272 (S) ADVANCED TO THIRD READING UNAN CONSENT 4/15/98 3272 (S) READ THE THIRD TIME CSSB 319(L&C) 4/15/98 3272 (S) FAILED PASSAGE Y10 N9 E1 4/15/98 3273 (S) PHILLIPS NOTICE OF RECONSIDERATION 4/16/98 3295 (S) RECON TAKEN UP - IN THIRD READING 4/16/98 3295 (S) RETURN TO RLS COMMITTEE 4/21/98 3418 (S) RULES TO CALENDAR ON RECONSIDERATION 4/21/98 3418 (S) IN THIRD READING ON RECONSIDERATION 4/21/98 3418 (S) PASSED ON RECONSIDERATION Y15 N5 4/21/98 3419 (S) EFFECTIVE DATE(S) SAME AS PASSAGE 4/21/98 3419 (S) COURT RULE(S) FLD Y13 N7 4/21/98 3419 (S) MTN TO RESCIND ACTION FLG COURT RULE CHG 4/21/98 3419 (S) HELD WITH RESCIND MOTION TO 4/22 CAL 4/22/98 3442 (S) RESCIND MOTION WITHDRAWN UNAN CONSENT 4/22/98 3442 (S) MOTION TO RESCIND ACTION IN PASSING 4/22/98 3442 (S) RESCIND ACTION ADOPTED UNAN CONSENT 4/22/98 3443 (S) RETURN TO RULES COMMITTEE 4/29/98 (S) RLS AT 12:20 PM FAHRENKAMP RM 203 4/30/98 (S) RLS AT 11:40 AM FAHRENKAMP RM 203 4/30/98 3626 (S) RLS RPT W/CS AND CALENDAR 4/30/98 4/30/98 3626 (S) PREVIOUS ZERO FN APPLIES (LAW) 4/30/98 3633 (S) RETURN TO SECOND RDG FOR SPECIFIC AM 4/30/98 3633 (S) RLS CS ADOPTED UNAN CONSENT 4/30/98 3633 (S) AUTOMATICALLY IN THIRD READING 4/30/98 3633 (S) PASSED ON RECONSIDERATION Y14 N5 E1 4/30/98 3634 (S) EFFECTIVE DATE(S) SAME AS PASSAGE 4/30/98 3634 (S) COURT RULE(S) SAME AS PASSAGE 4/30/98 3636 (S) TRANSMITTED TO (H) 5/01/98 3384 (H) READ THE FIRST TIME - REFERRAL(S) 5/01/98 3384 (H) JUDICIARY 5/05/98 (H) JUD AT 1:00 PM CAPITOL 120 BILL: SB 274 SHORT TITLE: PROBATION AND PAROLE FEES SPONSOR(S): SENATOR(S) WARD, Pearce Jrn-Date Jrn-Page Action 2/04/98 2392 (S) READ THE FIRST TIME - REFERRAL(S) 2/04/98 2392 (S) JUD, FIN 2/18/98 (S) JUD AT 1:30 PM BELTZ ROOM 211 2/18/98 (S) MINUTE(JUD) 2/19/98 2574 (S) JUD RPT CS 3DP 1NR SAME TITLE 2/19/98 2574 (S) DP: TAYLOR, MILLER, PEARCE NR: ELLIS 2/19/98 2574 (S) INDETERMINATE FN TO SB & CS (ADM) 3/24/98 (S) FIN AT 9:00 AM SENATE FINANCE 532 4/16/98 (S) FIN AT 9:00 AM SENATE FINANCE 532 4/16/98 (S) FIN AT 4:30 PM SENATE FINANCE 532 4/17/98 (S) FIN AT 9:00 AM SENATE FINANCE 532 4/21/98 (S) RLS AT 12:15 PM FAHRENKAMP RM 203 4/21/98 3411 (S) FIN RPT CS 4DP 1NR 1DNP NEW TITLE 4/21/98 3411 (S) DP: SHARP, PEARCE, PHILLIPS, DONLEY; 4/21/98 3411 (S) NR: PARNELL; DNP: ADAMS 4/22/98 3432 (S) FN TO CS (COR) 4/21/98 3411 (S) PREVIOUS INDETERMINATE FN APPLIES (ADM) 4/22/98 3435 (S) RULES TO CALENDAR 4/22/98 4/22/98 3438 (S) READ THE SECOND TIME 4/22/98 3438 (S) FIN CS ADOPTED UNAN CONSENT 4/22/98 3438 (S) AM NO 1 ADOPTED UNAN CONSENT 4/22/98 3438 (S) ADVANCE TO THIRD READING FLD Y14 N5 E1 4/22/98 3439 (S) THIRD READING 4/23 CALENDAR 4/23/98 3463 (S) READ THE THIRD TIME CSSB 274(FIN) AM 4/23/98 3463 (S) PASSED Y17 N1 E1 A1 4/23/98 3463 (S) LINCOLN NOTICE OF RECONSIDERATION 4/24/98 3489 (S) RECON TAKEN UP - IN THIRD READING 4/24/98 3489 (S) RETURN TO SECOND FOR AM 2 UNAN CONSENT 4/24/98 3489 (S) AM NO 2 OFFERED BY LINCOLN 4/24/98 3489 (S) AM NO 2 FAILED Y4 N12 E3 A1 4/24/98 3490 (S) AUTOMATICALLY IN THIRD READING 4/24/98 3490 (S) PASSED ON RECONSIDERATION Y13 N3 E3 A1 4/24/98 3492 (S) TRANSMITTED TO (H) 4/27/98 3271 (H) READ THE FIRST TIME - REFERRAL(S) 4/27/98 3271 (H) JUDICIARY, FINANCE 5/05/98 (H) JUD AT 1:00 PM CAPITOL 120 BILL: SB 232 SHORT TITLE: ELECTRONIC RECORDS; RECORD REQUIREMENTS SPONSOR(S): SENATOR(S) PARNELL; REPRESENTATIVE(S) Kemplen Jrn-Date Jrn-Page Action 1/14/98 2193 (S) READ THE FIRST TIME - REFERRAL(S) 1/14/98 2193 (S) L&C, JUD 3/31/98 (S) L&C AT 1:30 PM FAHRENKAMP RM 203 4/01/98 3090 (S) L&C RPT 2DP 2NR 4/01/98 3090 (S) DP: LEMAN, KELLY; NR: MILLER, HOFFMAN 4/01/98 3090 (S) ZERO FISCAL NOTE (GOV/ALL DEPTS) 4/08/98 (S) JUD AT 1:30 PM BELTZ ROOM 211 4/08/98 (S) MINUTE(JUD) 4/20/98 (S) JUD AT 1:30 PM BELTZ ROOM 211 4/21/98 (S) RLS AT 12:15 PM FAHRENKAMP RM 203 4/21/98 3410 (S) JUD RPT CS 4DP SAME TITLE 4/21/98 3410 (S) DP: TAYLOR, PARNELL, MILLER, PEARCE 4/21/98 3410 (S) PREVIOUS ZERO FN APPLIES (GOV/ALL DEPTS) 4/22/98 3435 (S) RULES TO CALENDAR 4/22/98 4/22/98 3437 (S) READ THE SECOND TIME 4/22/98 3437 (S) JUD CS ADOPTED UNAN CONSENT 4/22/98 3437 (S) ADVANCED TO THIRD READING UNAN CONSENT 4/22/98 3437 (S) READ THE THIRD TIME CSSB 232(JUD) 4/22/98 3437 (S) PASSED Y19 N- E1 4/22/98 3437 (S) DUNCAN NOTICE OF RECONSIDERATION 4/23/98 3465 (S) RECONSIDERATION NOT TAKEN UP 4/23/98 3466 (S) TRANSMITTED TO (H) 4/24/98 3237 (H) READ THE FIRST TIME - REFERRAL(S) 4/24/98 3237 (H) JUDICIARY 5/05/98 (H) JUD AT 1:00 PM CAPITOL 120 BILL: HB 444 SHORT TITLE: PATERNITY CHILD SUPPORT ARREARS SPONSOR(S): REPRESENTATIVES(S) NICHOLIA Jrn-Date Jrn-Page Action 2/18/98 2360 (H) READ THE FIRST TIME - REFERRAL(S) 2/18/98 2360 (H) HES, JUDICIARY, FINANCE 5/05/98 (H) JUD AT 1:00 PM CAPITOL 120 5/05/98 3539 (H) HES REFERRAL WAIVED 5/05/98 3539 (H) REFERRED TO JUD WITNESS REGISTER ANNETTE KREITZER, Legislative Assistant to Senator Loren Leman Alaska State Legislature Capitol Building, Room 113 Juneau, Alaska 99801 Telephone: (907) 465-3844 POSITION STATEMENT: Testified on CSSB 254(FIN) and CSSB 329(JUD) AM. NANCI JONES, Director Permanent Fund Dividend Division Department of Revenue P.O. Box 110460 Juneau, Alaska 99811 Telephone: (907) 465-2323 POSITION STATEMENT: Testified on CSSB 254(FIN). DEBRA VOGT, Deputy Commissioner Department of Revenue P.O. Box 110400 Juneau, Alaska 99811 Telephone: (907) 465-2300 POSITION STATEMENT: Testified on CSSB 254(FIN). BOB BARTHOLOMEW, Deputy Director Income and Excise Audit Division Department of Revenue P.O. Box 110420 Juneau, Alaska 99811 Telephone: (907) 2320 POSITION STATEMENT: Testified on CSSB 329(JUD) AM. CATHERINE REARDON, Director Division of Occupational Licensing Department of Commerce and Economic Development P.O. Box 110806 Juneau, Alaska 99811 Telephone: (907) 2534 POSITION STATEMENT: Testified in favor of CSSB 329(JUD) AM. RALPH BENNETT, Legislative Administrative Assistant to Senator Robin Taylor Alaska State Legislature Capitol Building, Room 30 Juneau, Alaska 99801 Telephone: (907) 465-3171 POSITION STATEMENT: Testified on CSSB 114(JUD) AM and HCSCSSB 158(L&C). BROOKE MILES, Regulation of Lobbying Alaska Public Offices Commission Department of Administration P.O. Box 110222 Juneau, Alaska 99811 Telephone: (907) 465-4864 POSITION STATEMENT: Testified in favor of CSSB 114(JUD) AM. MICHAEL LESSMEIER, Lobbyist State Farm Insurance 8391 Airport Blvd. Juneau, Alaska 99802 Telephone: (907) 789-9849 POSITION STATEMENT: Testified in support of HCSCSSB 158(L&C). JERRY BURNETT, Legislative Assistant to Randy Phillips Alaska State Legislature Capitol Building, Room 208 Juneau, Alaska 99801 Telephone: (907) 465-6590 POSITION STATEMENT: Testified on CSSB 319(RLS). RICHARD VITALE, Legislative Assistant to Senator Sean Parnell Alaska State Legislature Capitol Building, Room 054 Juneau, Alaska 99801 Telephone: (907) 465-3880 POSITION STATEMENT: Testified on CSSB 232(JUD). SHIRLEY DEAN Child Support Enforcement Division Department of Revenue 239 South Franklin Street, Suite 311 Juneau, Alaska 99801 Telephone: (907) 465-5887 POSITION STATEMENT: Testified on HB 444. ACTION NARRATIVE TAPE 98-83, SIDE A Number 0001 CHAIRMAN JOE GREEN called the House Judiciary Standing Committee meeting to order at 1:10 p.m. Members present at the call to order were Representatives Green, Bunde, Porter, Croft and Berkowitz. Representatives Rokeberg arrived at 1:10 p.m and Representative James arrived at 1:26 p.m. CSSB 254(FIN) - LEVY ON PERMANENT FUND DIVIDEND Number 0001 CHAIRMAN GREEN announced the first order of business to be CSSB 254(FIN), "An Act relating to the exemption from levy, execution, garnishment, attachment, or other remedy for the collection of debt as applied to a permanent fund dividend." Number 0054 ANNETTE KREITZER, Legislative Assistant to Senator Loren Leman, Alaska State Legislature, stated that CSSB 254(FIN) will significantly enhance the ability of Alaska businesses and other private parties to collect from debtors who are in a state of default on their financial obligations. She explained that existing state law provides that 45 percent of a person's annual permanent fund dividend check is exempt from collection to pay an outstanding debt. Therefore, even if a person had a court judgement stipulating that they owe a certain amount of money, almost half of their dividend check is exempt from collection, at least when a private party is seeking to collect. She pointed out that there are exceptions to this; child support obligations, student loans and any debts owed to the agency of the state. In those cases the state can garnish 100 percent of a dividend check to satisfy that financial obligation. She stated that small businesses and other private parties do not enjoy that same right. She stated that the original bill proposed to eliminate the 45 percent exemption but an amendment restored the exemption but lowered it to 20 percent. She explained that the percentage of a dividend available for garnishment by private parties would increase from 55 to 80 percent and state agencies would still collect at a rate of 100 percent. Number 0189 REPRESENTATIVE CON BUNDE stated that the dividend is not a huge amount of money and asked what the reasoning was behind going from collecting 100 percent to 80 percent. Number 0227 MS. KREITZER replied that there is a fear that people would not apply for their dividends. Number 0247 REPRESENTATIVE ERIC CROFT asked if the child care debt would come before business debts. MS. KREITZER replied that is correct. Number 0271 REPRESENTATIVE BRIAN PORTER asked, "Why are we taking out the -- if this exemption applies to eligible individual's permanent fund dividend (PFD) both before and after payment?" Number 0284 MS. KREITZER replied that it was something that was requested by the Department of Law but she is not certain. She thought that maybe Nancy Jones could answer that question. Number 0330 NANCY JONES, Director, Permanent Fund Dividend Division, Department of Revenue, stated that in regards to Representative Porter's question there are things that operate on a person's account once it becomes their asset in their bank account. She stated that when the exemption was 55/45, once it when into a person's joint asset account there were different rules that applied, as to who can actually garnish a person's bank account. Therefore, the "before and after payment" was keeping the same ratio of 55/45 all the way into the commingling of a person's assets. She explained that the Department of Law is no longer saying it is applicable and suggested that language be taken out. Number 0404 CHAIRMAN GREEN asked what prevents the person from not filing when the state is going garnish the dividend. Number 0426 MS. JONES replied that she could not give out the numbers because there are not statistics on what is not there. She stated that it is felt in regards to child support because the dividend is going to be garnished that people actually do not file. Number 0457 CHAIRMAN GREEN asked what about in the case of the state collecting. MS. JONES replied that it is the same scenario. Number 0482 CHAIRMAN GREEN stated that he just received a note that states that in some cases a judge may order a person to file for their PFD. MS. JONES stated that there are assignments in the court restitutions of what they can do to get a dividend. She stated that it is still a disincentive for a person to file if in fact punitively, the dividend is going to be taken away. Number 0504 REPRESENTATIVE BERKOWITZ stated that in regards to the hierarchy of payment the Child Support Enforcement Division (CSED) would get it first and then the Department of Law would come about.... MS. JONES replied that the courts would come about fifth. She stated that the highest priority is trustee and bankruptcy, then child support, after that is the state agencies, then IRS and then court offered restitutions. She stated that after that comes the civil cases that are referred to in this bill. REPRESENTATIVE BERKOWITZ asked if this would come co-equal with a civil judgement. MS. JONES relied that is correct and that is what these are. Number 0576 REPRESENTATIVE BERKOWITZ asked if in order to attach the permanent fund one would have to go through a court proceeding. MS. JONES replied that is correct because it has to be deemed by a judgement as a legal debt. One can't come up off the street and demand someone's dividend, it has to go through a court proceeding. Number 0610 REPRESENTATIVE BERKOWITZ stated that if there was a $1,000 dividend and there are no other incumbencies on it, $800 would be what is available for collection. If there was a CSED garnishment of $300, the available amount would be $500. He asked if there was a way to protect the privacy of that person. MS. JONES replied yes there is. All the division tells the party that is seeking to garnish the dividend, even a state agency, is that either the person did not file or that there are no funds available. They do not disclose what agencies have already garnished the dividend. Number 0664 REPRESENTATIVE BERKOWITZ asked if in the civil format, can a creditor compel an individual to file. MS. JONES replied that no one can compel an individual to file an application and the division can not intercede and collect the dividend as if the person has filed, if they do not in fact file. Number 0702 CHAIRMAN GREEN asked if Representative Berkowitz's example was discussed in any other committee. For example, if $500 was left of the dividend after a garnishment, is that next party entitled to $300 or would they be able to file for 80 percent of the remainder. Number 0730 MS. JONES replied that it would be 80 percent of the remainder of the dividend would be available to the collector after the levies. "So it goes down in order, the first thing that comes out is the $2 PFD fee for levies, so if it is 5 levies that is $10 right off the top for PFD, whether it hits or not. The computer then looks at the order of who is doing the levying and then it takes out in order. If it is a 100 percent then the first five bankruptcies CSED, post secondary state agencies, or IRS a 100 percent -- the rest of the check is taken. If the debt in any one those agencies that's capable of $100 percent is less then 100 percent then the 80 percent would be applied -- 80/20 in this situation." Number 0790 REPRESENTATIVE BUNDE asked if someone has a debt greater then the PFD they would get 80 percent but if there were three small debts each one would only get 80 percent of the remainder in sequence of order. MS. JONES replied that would be correct. She stated that each time the levy is placed on the dividend the calculation of 80/20 would apply to each specific collector. Everyone is independent it would not be lumped together, each levy is looked at as if it is the only one. Number 0862 CHAIRMAN GREEN asked if a person was trying to collect $300 that would be within the 80 percent but they would not get $300. Number 0865 MS. JONES replied, "Right, it depends on what the debt is. They do not just take 80/20 it depends of what the debt is. So if the debt is less then that, they are not going to get the entire check. They still get whatever the particular debt is and it looks at a 80/20 ratio." CHAIRMAN GREEN asked "What if there weren't the other two in sequence -- would they only get $240." MS. JONES replied that they would only get 80 percent. CHAIRMAN GREEN stated "Yes but the accumulated amount could not exceed 80 percent -- first in lines gets $300, second gets $300, third only get $200." MS. JONES replied no, that is not correct. Number 0926 REPRESENTATIVE PORTER stated that if that is the way it is being administered then there are regulations written that are inconsistent with the statute. He stated that the bill reads that 20 percent of the annual PFD is exempt from levy, not that each levy can only obtain 80 percent of its value. He stated that if the division is administering it that way they are administering it inconsistent with the statute. Number 0957 MS. JONES replied that this bill is proposed legislation. REPRESENTATIVE PORTER stated that he is referring to the statute that is in place. MS. JONES stated that it is currently 55/45 and it is not to the capacity of the debt, it is on the person's entire dividend but each time that a person comes to levy the dividend the division has to look at 80/20 ratio. REPRESENTATIVE PORTER stated that if there is a $1,000 dividend and there is a $300 levy and that is the only levy he asked what would that person would get. Number 1001 MS. JONES replied that he would get $300. CHAIRMAN GREEN stated that is not what she said to him. MS. JONES stated that is what she meant to say. She stated that Chairman Green was talking about multiple levies and she stated that she answered the ratio of 80/20 would have to be applied. Number 1012 CHAIRMAN GREEN asked, "The first $300 in, gets $300. The next $300 gets his $300, the third one is only going to be able to get $200 because there is already $600 that has been paid out and the maximum that can be paid out is $800, but they don't all get $240 $240 and $240?" MS. JONES replied that is correct. Number 1040 REPRESENTATIVE BERKOWITZ stated that he reads it a little differently. The first person is looking at $1000 that he can take from and the second is looking at $700 that he can take from and the third person is looking at $400. This is because one is allowed the percent of the dividend payable to the individual. He explained that it is not payable if there is an incumbency on it. He stated that the second person would get up to 80 percent of the $700. Number 1121 CHAIRMAN GREEN stated that it does not protect the person's 20 percent. He said, "The $800 is always attachable, $300 now drops to $500 and 80 percent of $500 is $400 that could be attached." REPRESENTATIVE PORTER stated under this bill and under a $1,000 dividend, the recipient of the dividend would be able to obtain $200, if there were more than $800 worth of levies. Number 1155 CHAIRMAN GREEN stated that the committee is trying to figure out how it would be administered when there is more than $800 to be paid out. Number 1179 MS. JONES stated it is "first in time, first in line." On a $1,000 dividend $800 is available so if the first in line collection is $400 that will be paid out. If the next one depletes what is left the third party will not receive anything. She stated that it is first come first serve with the ceiling of 80/20 split. CHAIRMAN GREEN asked if it would not be pro-rated at any time. MS. JONES replied that is correct. REPRESENTATIVE ERIC CROFT asked if it mattered that all the collections are civil judgements. He stated that if CSED had an $800 dollar judgement would the $200 left, go to a civil judgement. MS. JONES stated that it would be on the 80/20 ratio. She stated first there was 100 percent of the dividend available to CSED, the balance left would then under a civil collection order would apply the 80/20 ratio, to what is left. REPRESENTATIVE CROFT asked if it the 80/20 ratio is on the original amount of the dividend or on the amount that is left. MS. JONES replied that it is her understanding that it is on the amount that is left. Number 1301 CHAIRMAN GREEN stated that if this became law, if the first $800 went to a 100 percent entitled collector, the bill stated that 20 percent of the dividend is exempt. He stated that the civil action collector would then be out of luck. REPRESENTATIVE BERKOWITZ stated that he would disagree. The bill referred to the PFD payable to the individual. He stated that there would be $200 left over after the first payment and 20 percent of that $200 is protected, therefore, the civil judgement could go to the extent of $160. Number 1345 CHAIRMAN GREEN stated that he disagreed. He said, "It states the annual permanent fund dividend payable that's the $1000 -- 20 percent of that full amount is exempt and what ever is paid out of the 80 percent is not leaving $200, which then is subject to this because it says the annual permanent fund dividend payable." Number 1368 REPRESENTATIVE CROFT referred to Section 1 (b) which lists all the exemptions. Number 1390 DEBRA VOGT, Deputy Commissioner, Department of Revenue, stated that it was her understanding that when a person or any combination of people, who is not entitled to take 100 percent of the dividend, under this bill, 20 percent would be exempt and it stays exempt unless a person who is entitled to take all of it takes it. She stated that if it is a $1000 dividend and it is paid off to collectors that person will still have to pay tax on that money because it is still his. She stated that she understand Representative Berkowitz's point but they have interpreted it to be that the dividend belongs to the recipient even if some of it is paid off to creditors. Number 1455 CHAIRMAN GREEN asked if there is verbiage that may avoid this confusion. MS. VOGT stated that as she understood the legislation, all it does is change the percentage from 45 percent to 20 percent and it really isn't going to change the way the department has to administered it. Number 1482 REPRESENTATIVE PORTER stated that to him the optimum word is annual permanent fund dividend and that is what the person gets to keep 20 percent of, not what may be left after a small levy. He asked if she knew why the attorneys said it is not necessary to have the before and after payment language in the bill. Number 1507 MS. JONES replied that the Department of Law took it out because there is a separate priority of assets once they are co-mingled. She stated that it was superfluous to have that language in there because once it is paid to a person and it goes to their account there is not any control over who can levy on that bank account. Number 1535 REPRESENTATIVE BUNDE stated that the money can only be taken before it goes into possession of the person. MS. JONES replied that is correct and that is what they do. Number 1551 REPRESENTATIVE CROFT asked if it was correct that in 1997, CSED received over $11 million and there were about 100,000 attachments. He asked if there were about 600,000 people who get the dividend. MS. JONES replied that is correct and there are about 550,000 people that get the dividend. REPRESENTATIVE CROFT asked if 20 percent of the dividends have attachments on them. MS. JONES replied yes, they are either voluntary or involuntary. Number 1585 REPRESENTATIVE CROFT stated that businesses collected over $5 million. Number 1591 MS. JONES stated that they did well because the Internal Revenue Service withdrew. Number 1655 REPRESENTATIVE JEANETTE JAMES asked "Does the agency have the ability to garnish the permanent fund for people who the money does go to the agency on CSED because there is a lot of CSED collections that are for the children but because the parent is on welfare they do get the money." Number 1676 MS. VOGT replied that the dividend goes to the Department of Health and Social Services. It does not stay with CSED. REPRESENTATIVE JAMES stated that she understood that and asked if doesn't a large percent of it go through Division of Family and Youth Services (DFYS). MS. VOGT stated that is correct a large percent of it does go through DFYS but it does not pass through the operating expenditure et cetera. Number 1710 REPRESENTATIVE JAMES stated that she has mixed feelings on the legislation. She stated that she believes people should pay their bills but there is money coming out of the permanent fund every year to hold people harmless who are on welfare. She stated that they might be getting the people who are going to lose their dividend after they have already been held harmless. Number 1769 REPRESENTATIVE NORMAN ROKEBERG made a motion to move CSSB 254(FIN), 0-LS1371\H, out of committee with the attached zero fiscal note and with individual recommendations. Number 1784 CHAIRMAN GREEN asked if there was an objection. Hearing none, CSSB 254(FIN), 0-LS1371\H, moved out of the House Judiciary Standing Committee. CSSB 329(JUD) AM - INVESTMENT CLUB LICENSE EXEMPTION Number 1790 CHAIRMAN GREEN announced the next order of business to be CSSB 329(JUD) am, "An Act relating to the regulation authority, exemptions, and definitions of the Alaska Business License Act." MS. KREITZER stated that the Senate Labor and Commerce Committee introduced SB 329 at the request of the Alaska Regional Council, National Association of Investors Corporation after they called the Department of Commerce, Division of Occupational Licensing to ask whether they should be required to purchase a business license to operate an investors club. She stated that within their own division they have had conflicting opinions about whether this group of people would need to purchase a business license. She stated that no other state requires an investment group to purchase a business license because they are seen as educational tools for people to learn about investments, as profit is not the purpose of the group, education is. Number 1855 MS. KREITZER stated that Section 1 of CSSB 329(JUD) am gives broader regulatory authority to the Division of Occupational Licensing, Department of Commerce. She stated that their only authority under this section is to determine and collect fees. In order to implement these exemptions and to be able to lay things out plainly in the regulatory process they would like to have more authority. She explained that Section 2 just reorders the current business license exemption and adds investment clubs and a definition of security to the exemptions. She stated that the definition of "business," upon the request of the Division of Occupational Licensing, was made more plain. She stated that the only exemption that has been added in is the terms investment club and security and then the new definition of business. Number 1960 MS. KREITZER stated that she believed the committee had a suggested amendment because of SB 240, as it is not longer appropriate to include in the exemptions on page 1, line 14 "sales through coin- operated amusement and gaming machines". She stated that the sponsor agrees with the amendment. Number 1979 CHAIRMAN GREEN asked if SB 240 is now, in fact, law. UNIDENTIFIED SPEAKER replied yes it is. Number 1986 REPRESENTATIVE BUNDE made a motion to adopt Amendment 1 which reads: Page 1, line 14: Delete all material Page 2, line 1: Delete "(6)" Insert "(5)" Page 2, line 2: Delete "(7)" Insert "(6)" Page 2, line 4: Delete "(8)" Insert "(7)" CHAIRMAN GREEN asked if there was an objection. Number 2006 REPRESENTATIVE CROFT objected for discussion purposes. Number 2010 BOB BARTHOLOMEW, Deputy Director, Income and Excise Audit Division, Department of Revenue, stated that the amendment is just a technical clean-up because if that exemption was not removed there could be some businesses in Alaska who do only coin operation and would be allowed to operate without a license. Number 2036 REPRESENTATIVE CROFT removed his objection. Number 2042 CHAIRMAN GREEN asked if there was a further objection. Hearing none, Amendment 1 was adopted. Number 2061 CATHERINE REARDON, Director, Division of Occupational Licensing, Department of Commerce and Economic Development, stated that she strongly supports CSSB 329(JUD) AM. Number 2081 REPRESENTATIVE PORTER asked if she was familiar with the investment club. MS. REARDON stated that her understanding is started with the Beardstown Lady's Club; each member would contribute $30 and decide what stocks to invest in. She stated that based on their successes and a book that they put out, some more people started to form investment clubs. She stated that this legislation may have been requested by National Association of Investment Clubs so that it would be clear whether a business license is required in Alaska. She pointed out that a business license costs $50 for two years. There are about six investment clubs that have business licenses now and it is true that her staff has told some clubs that they need the licences and others that they do not have to get them, due to confusion over whether the goal of the clubs is to make money or if it was an educational activity. She stated that this bill would involve the potential loss of revenue of $250 every two years out of a program that brings over $1 million. She stated that it is a very nominal loss which is why there is a zero fiscal note. Number 2186 REPRESENTATIVE BUNDE stated that he thought it was against the law for investment clubs to advertise and asked if the clubs employ any one. He wondered if brokerages could be in existence under the guise of an investment club. Number 2213 MS. REARDON replied that business licensing has not been keeping a check on that. She stated that removing them from the requirement to get a business license would not have an effect on, violations of the banking, securities and corporations laws. She stated that it is the security laws that regulate the professions. Number 2245 REPRESENTATIVE NORMAN ROKEBERG asked isn't the business fee really a business tax and therefore, it does not give the division any enforcement power. MS. REARDON replied that is correct. REPRESENTATIVE ROKEBERG asked how is the definition of business different from the Labor and Commerce Committee's definition of business. Number 2279 MS. REARDON replied that Representative Rokeberg is referring to HB 438 which was a companion bill to this bill. She stated that it had a slightly different definition of business. Both are attempts to define it more simply. Number 2302 CHAIRMAN GREEN asked Representative Rokeberg if it was his intent to change the definition. REPRESENTATIVE ROKEBERG replied no, he just wanted to remind himself what his committee came up with as they spend a great deal of time on the definition. He asked Ms. Reardon to read the definition. Number 2316 MS. REARDON stated that HB 438 defined "business" as "a profit or nonprofit entity engaging or offering to engage in a trade, a service, a profession, or an activity with the goal of receiving a percunary benefit in exchange for the provision of services or goods or other real or person property or nonprofit activity." She stated that the primary difference is "a profit of nonprofit entity" is added and there are more synonyms for activity at the end of the definition in this version. Number 2352 REPRESENTATIVE ROKEBERG asked if there was any discussion in the Senate Judiciary Committee on the issue of nonprofit. Number 2366 MS. KREITZER replied there was not. She stated that they were aware of (indisc.--coughing) in the House Labor and Commerce Committee and the Senate chairman chose not to include it in this version. Number 2375 REPRESENTATIVE ROKEBERG stated that the only reason he is bringing it up is because they are defining what a business is in the state of Alaska and it will be referred to in other statutory references. The issue is whether to include nonprofit in the definition. Number 2397 CHAIRMAN GREEN replied that is why he asked Representative Rokeberg earlier if his question was leading to an amendment or just background information. REPRESENTATIVE ROKEBERG replied that it was background information because he did not remember what he did in committee. He stated that it is an issue to be considered. Number 2412 REPRESENTATIVE JAMES stated that she is not real comfortable with the definition of business, as it is skimpy. She stated that the business license is a tax and does not consider $25 a year a real tax. She stated that it seems like it is for some other reason. She asked if she wanted to know who owned a business could she call to division to find out. Number 2450 MS. REARDON replied that the reason a data collection benefited business licensing is that people can get lists .... TAPE 98-83, SIDE B Number 0042 MS. REARDON stated that people can look on the Internet to find out what kinds of business there are. She stated that they do not register business names, as that is in statute under the Banking Securities and Corporations Division. Therefore, ten people may get the same name, as it is not exclusive. She stated that a person could call up and she could search to see who owned a business. She stated that in the terms that it is a tax there is no public protection aspect, a business license is not a good house keeping seal that the business is being run properly. Number 0050 REPRESENTATIVE JAMES asked if she gets many calls of people wanting to know who has a license. She stated that if there was not a fee, the division would be doing it for free so she is suggesting that it is not necessarily a tax. Number 0072 MS. REARDON stated that they do get quite a few calls. REPRESENTATIVE CROFT asked if they would give a license to "Mimi's House of Prostitution." MS. REARDON replied that yes, as the statute does not give criteria for denying licenses for that type of reason. She stated that it is important how the definition of business is defined and sees either definition of business as a great improvement over the current statute's definition. She did not want the bill to die over the definition of business. Number 0116 REPRESENTATIVE CROFT stated that there seems to be a major question about profit or nonprofit. He stated that to him, by adding the words real or personal to property does not change the word property. Pecuniary is a synonym for financial, therefore, the only other substantive difference is adding "a service to trade profession or the generic activity with the goal of receiving a financial benefit." He asked if the division licenses nonprofit businesses now. Number 0144 MS. REARDON stated that they do license some nonprofit businesses. The Salvation Army has a business license because it is bringing in money for its activities. She stated that she wanted to clarify something that she said at a previous time. If a nonprofit business was not selling anything to the general public and was just receiving grants they would not need a business license. Number 0200 REPRESENTATIVE ROKEBERG stated that is his concern and that is why that provision was put in the definition. It is a major addition to cleaning up the statutes and the way the definition is in CSSB 329(JUD) AM, it would exclude the ability to license a nonprofit organization. Number 0241 REPRESENTATIVE BUNDE stated that with the Salvation Army they have to get a business license yet, there is no enforcement ability. He asked what would happen if they did not get one. Number 0252 MS. REARDON stated that what she meant when referring to their enforcement ability was, they do not have the right to take away the business license if the business is doing shady business. She stated that they do advise people on whether or not they need to obtain a license, if someone was to refuse to get a license the district attorney would then have to handle the case and it would be a misdemeanor. Usually people do get a business license, as the fee is so low. Number 0297 REPRESENTATIVE BUNDE said that since there is some sort of prosecution then there is some regulatory aspect to it. Number 0313 MS. REARDON stated that there is a law that states that they must have a business license but it is not regulatory in terms of how they practice their business. Number 0321 REPRESENTATIVE PORTER stated that the original intent of the bill was to exempt investment clubs and he has some concerns about that. He stated that he could envision having the E. F. Hutton investment club. Number 0360 MS. KREITZER referred to information in the committee members' packet from Mr. Damron and reiterated that no other states require investment clubs to purchase business licenses. She stated that the definition of investment clubs is "a group of individuals incorporated or otherwise organized, that engages primarily in investing in securities, that does not sell investment services to another person, and the primary purpose of which is educational. " She stated that the purpose of the amended version of the bill was to make it easier for the public and so there is not conflicting advise. She stated that it is her understanding that it does not exclude nonprofit and, therefore, if it does not specifically exclude it, it includes it. Number 0432 REPRESENTATIVE JAMES stated that Representative Rokeberg's definition says something about rentals or properties and this definition does not clarify that. Number 0448 REPRESENTATIVE ROKEBERG stated that the biggest distinction between the definitions relates to the profit/nonprofit. He stated that he would like the public to know what a law is saying, the definition in the Senate bill is not clear. Number 0518 MS. KREITZER asked if he is suggesting an amendment and asking for the sponsor's response. Number 0531 REPRESENTATIVE ROKEBERG stated that he would defer to Representative Croft. REPRESENTATIVE CROFT stated that he as a possible amendment, that if on line 7 after person insert "that does not advertise," it would put some more restrictions on investment clubs. Number 0569 MS. KREITZER replied that would be fine. Number 0579 CHAIRMAN GREEN asked if an investment club put out a flyer would that be a problem with this new language. REPRESENTATIVE CROFT replied that if it is for internal information purposes it wouldn't but if it was to attract new members then it would be. Number 0888 REPRESENTATIVE CROFT made a motion to adopt Amendment 2. Number 0632 CHAIRMAN GREEN asked if there was an objection. Hearing none, Amendment 2 was adopted. Number 0647 REPRESENTATIVE ROKEBERG stated that the bill is already amended and asked of there would be an objection to adding the profit/nonprofit entity into the definition of business. Number 0667 MS. KREITZER stated that anything that would help make it clear to the public and Administration is fine because that is the intent of the rewriting the definition of business. Number 0671 REPRESENTATIVE ROKEBERG asked Ms. Reardon, "If we were to go back to a portion of this (indisc.--mumbling) and just add the business means a profit or nonprofit entity, add the word service and then 'or nonprofit activity' at the end of the sentence and not go into the real or personal property." He stated that the word pecuniary is a better word because means involving money and has a broader definition then "financial". Number 0773 MS. REARDON stated that it would be fine but perhaps the final reference to nonprofit may not be included because it was already stated at the beginning. REPRESENTATIVE ROKEBERG replied that would be okay, therefore, not every nonprofit business would qualify for a license but some would. MS. REARDON stated that it would be her intent. Number 0785 REPRESENTATIVE PORTER stated that if the intent is to make this understandable to the public he would resist the word pecuniary. The term financial benefit is pretty much understood the term pecuniary is generally not understood. CHAIRMAN GREEN agreed. Number 0822 REPRESENTATIVE CROFT moved to adopt Amendment 3, which would take Section 3, and delete the definition and insert "business means a profit of nonprofit entity engaging or offering to engage in a trade, a service, a profession or an activity with the goal of receiving a financial benefit in exchange for the provision of services or goods or other property;" Number 0877 CHAIRMAN GREEN asked if there was an objection. Hearing none, Amendment 3 is adopted. Number 0915 REPRESENTATIVE ROKEBERG made a motion to move CSSB 329(JUD) AM, as amended, out of committee with the attached fiscal note and with individual recommendations. Number 0940 CHAIRMAN GREEN asked if there was an objection. Hearing none, HCSCSSB 329(JUD) moved from the House Judiciary Standing Committee. CSSB 114(JUD) AM - EMPLOYEES: POLITICAL CONTRIB. & ACTIVITIES Number 0964 CHAIRMAN GREEN announced the next order of business to be CSSB 114(JUD) AM, "An Act relating to contributions from employee compensation for political purposes; and prohibiting certain kinds of discrimination against employees for political purposes." Number 0979 RALPH BENNETT, Legislative Administrative Assistant to Senator Robin Taylor, stated that several constituents expressed concern that employers automatically deduct contributions from their paychecks and once the deduction has been made the employee has no control over how the money is distributed and which candidates or issues it is used to support or oppose. He stated that this process of funding political actions by corporations and labor organizations is known as reverse check-off, which was recently banned by a Michigan statute. He stated the bill prohibits an employer or labor organization from giving a increase with the intent that it be donated in support of a candidate or issue. It also prohibits discrimination against an employee who fails to make a contribution intended to influence a political race. He explained that it also requires that public record be kept of payroll deductions made for disbursal as political contributions. He stated that the most important provision of SB 114 is that it takes written authorization from the employee before a deduction for political purposes can be made. He explained that the bill requires that such an authorization be issued annually by the employee and the employee must be informed of the anti- discrimination provisions that apply if they chose not to make the contribution. He pointed out that an employee's political convictions are private and deserve unequivocal respect rather than the intimidation allowed by the current process. He stated that Section 2 provides that "labor, employee organization dues, and employee benefits, deductions and authorization must comply with AS 15.13.160." Number 1163 REPRESENTATIVE CROFT stated that he had a couple of amendments. He made a motion to adopt Amendment 1, which reads: Page 2, Line 11 Delete "on a form prescribed by the commission" Page 2, lines 13-14: Delete "The written request is valid for no more than one calendar year from the date of signing by the employee." CHAIRMAN GREEN objected for purposes of discussion. Number 1220 REPRESENTATIVE CROFT stated that the restriction is arbitrary. He stated that it seems to step over the line from trying to make sure that the contributions are done voluntarily. He stated that he is not sure why he wanted the words "prescribed by the commission". He stated that is not as important to him as the second part of the amendment is. Number 1325 REPRESENTATIVE JAMES asked if he wanted to leave the words "prescribed by the commission" in the amendment. REPRESENTATIVE CROFT stated that whatever the committee wanted. He made a motion to divide the amendment in to 1A and 1B. Amendment 1A would read: Page 2, Line 11 Delete "on a form prescribed by the commission" Amendment 2 would read: Page 2, lines 13-14: Delete "The written request is valid for no more than one calendar year from the date of signing by the employee." REPRESENTATIVE JAMES stated that she agrees with Amendment 1A as each group may want to have a form and it would just contain one question. She asked how complicated could that be. Number 1386 REPRESENTATIVE PORTER stated that it could be very complicated because those questions can be complicated so no one will know what they are voting for. He stated that language is to preclude ambiguous language. REPRESENTATIVE ROKEBERG asked Mr. Bennett what he thought of the amendment. Number 1414 MR. BENNETT replied that as long as the intent of the legislation is preserved it would be okay. He stated that he did not have a precise sense of Senator Taylor's opinion on this. REPRESENTATIVE JAMES stated that she was swayed by Representative Porter's argument. Number 1468 REPRESENTATIVE CROFT withdrew Amendment 1A. CHAIRMAN GREEN stated that Amendment 1A has been withdrawn and now the committee is on Amendment 1B. REPRESENTATIVE JAMES objected. Number 1490 REPRESENTATIVE ROKEBERG asked Mr. Bennett what would the impact of the removal of this sentence be. Number 1501 MR. BENNETT stated that he thought it would be helpful, it would not cause any problems. REPRESENTATIVE ROKEBERG asked would it be better to have some type of a time limit. CHAIRMAN GREEN stated that one would be aware so that one would physically file an action. REPRESENTATIVE ROKEBERG stated that would this create more paperwork. Number 1551 REPRESENTATIVE JAMES stated that the line being deleted is what the intent of the bill is. Number 1563 MR. BENNETT stated that now that he has rethought this he agreed that Representative James is right. REPRESENTATIVE CROFT stated that he felt there is a lot of other substance to the bill with this sentence taken out. It states that one must follow certain procedures and sets an orderly procedure for what should happen. He stated that he did not feel the sentence in question does not set an orderly procedure but instead makes it cumbersome by having to physically opt-in every year. He stated that it is burdensome without a purpose. Number 1643 CHAIRMAN GREEN called for a roll call vote. Representative James, Rokeberg, Porter and Green voted against Amendment 1B. Representative Croft voted in favor of Amendment 1B. Amendment 1B failed. Number 1707 REPRESENTATIVE CROFT made a motion to adopt Amendment 2, which reads: Page 2, line 11 Delete "prescribed" and insert "approved" Number 1724 REPRESENTATIVE ROKEBERG objected. He realized he was on the wrong page and withdrew is objection. CHAIRMAN GREEN asked if there was an objection. Hearing none, Amendment 2 was adopted. Number 1804 REPRESENTATIVE CROFT made a motion to move Amendment 3 which reads: Page 2, line 9, following "contributions": Delete "to groups or" Number 1824 REPRESENTATIVE PORTER objected. REPRESENTATIVE CROFT stated that in talking to Alaska Public Offices Commission (APOC), the amendment would continue to restrict donations for use as political contributions. It would still allow one to donate to groups but (indisc.--coughing). He stated that the wording "to groups or" expands it unnecessarily and too broadly. He stated that he would like it to be tied to political contributions as it does not define the groups. Number 1941 REPRESENTATIVE PORTER stated that the emphasis here might be to political contributions as an employer or as an employee. He stated that if he was donating his money he would like to make the decision on where it is going. REPRESENTATIVE CROFT responded that he does have that right. He said, "It isn't necessary that in every area you do it every year or with the opt-in opt-out. You could do a opt-out opt-in , you could do others. For the core political contributions it makes sense that these specific restrictions be on." He stated to tie it to every group with these particular restrictions is too restrictive. Number 2033 REPRESENTATIVE PORTER stated that by having this as an annual requirement, one is in written communication with employees and it would not be difficult to make this happen. Number 2074 REPRESENTATIVE BERKOWITZ stated that there are withholdings and diversions from a portion of every employees wages and salaries to the IRS. He stated that the way it is written is so broad that one could not make withholdings under the language "withhold or divert". Number 2160 CHAIRMAN GREEN asked for a roll call vote. Representatives Croft and Berkowitz voted in favor of the amendment. Representatives Rokeberg, Porter, James and Green voted against it. Amendment 3 failed. Number 2248 REPRESENTATIVE CROFT made a motion to adopt Amendment 4 which reads: Page 2, line 9, following "groups: Delete "or" REPRESENTATIVE ROKEBERG objected. REPRESENTATIVE CROFT stated that it would allow contributions to groups but tie the contributions back to the political contributions. Number 2321 REPRESENTATIVE JAMES stated that one has to sign a W-4 form every year as an employee and it seems that filing other forms would not be a problem. However, if this was in the middle of the year, one would have to put forth a special effort to sign it. Number 2359 REPRESENTATIVE ROKEBERG stated that he has always had to fill out a form to give a payroll deduction to a group such as United Way, every year. REPRESENTATIVE CROFT stated that he had no recollection of it being every year. Number 2384 CHAIRMAN GREEN asked for a roll call vote. Representatives Croft, Green and Berkowitz voted in favor of the amendment. Representatives Rokeberg, Porter and James voted against it. Amendment 4 failed. Number 2464 REPRESENTATIVE CROFT made a motion to adopt Amendment 5, which reads: Page 2, line 29, following "AS 15.13.160.": Insert "A labor organization shall provide each employee whose dues or fees are contributed to a political action committee an opportunity to request that that portion of the dues or fees that are intended to be used as a political contribution be refunded. The request is valid until revoked. The labor organization shall refund the amount intended to be used as a political contribution to the employee no later than 30 days after the labor organization receives the payroll deduction form the employer." REPRESENTATIVE ROKEBERG objected. TAPE 98-84, SIDE A Number 0001 REPRESENTATIVE CROFT stated that there are the same rights with the continuing restriction on all of the contributions. He stated that one could state how much they intend to deduct and anyone can say no. Number 0073 REPRESENTATIVE JAMES stated that this would mean that an employee would have to do this no later than 30 days after the contribution is made. Therefore, the contribution could not be spent until after 30 days has gone by. She asked if this amendment is contingent on the others passing. REPRESENTATIVE CROFT said "It is not explicitly conditional on the one year, though I thought of them together. It still switches them to be -- may deduct and then you can say don't." Number 0176 REPRESENTATIVE JAMES stated that for administrative purposes it would be fine to ask them to revoke the request. She referred to the refund portion and stated that it bothers her. She stated that they should be able to stop it but did not know if they should have to receive a refund. Number 0253 REPRESENTATIVE PORTER stated that this reverses the intent of the bill and would be surprised if there was not in most labor contracts, these types of prohibitions against the employer. Number 0288 REPRESENTATIVE BERKOWITZ referred to "GOPAC" and stated that he is troubled as it seems like the intent of this legislation is that it was not formulated for Alaska. He stated that he would like to know if this bill was crafted for a Lower 48 situation. Number 0368 MR. BENNETT replied that he believe it was crafted to take care of a situation where people may be finding that the funds they are contributing are being spent without their permission. REPRESENTATIVE PORTER stated that if existing state law stayed where it was this bill would be superfluous. Number 0396 CHAIRMAN GREEN asked for a roll call vote. Representatives Croft and Berkowitz voted in favor of the amendment. Representatives Rokeberg, Porter, James and Green voted against it. Amendment 5 failed. Number 0479 REPRESENTATIVE ROKEBERG moved that the committee rescind their action on Amendment 2. He said, "after reading the bill further I want to go back and I would like the committee to rescind their actions which would require a concurrence bill by the Senate." He stated that it is just making a subtle change. Number 0555 REPRESENTATIVE CROFT objected. He stated that it improves the bill. He stated that there are rules that one body does not talk about the other body because they are supposed to independently evaluate bills. He stated that if it improves the bill that is what they ought to do. Number 0626 REPRESENTATIVE ROKEBERG stated that he did not disagree with Representative Croft in terms of the independent review of the bill. He stated that by having the group prescribe the form rather than have the individual employee have to go through the process of having it approved by APOC, is more efficient. Number 0728 CHAIRMAN GREEN suggested that maybe Brooke Miles could speak to this issue before the action is rescinded. REPRESENTATIVE ROKEBERG stated that he would withdraw his motion at the chair's request. Number 0752 BROOKE MILES, Regulation of Lobbying, Alaska Public Offices Commission, Department of Administration, stated that the commission met and discussed this bill and stated that their position statement is in the committee packet. She stated subparagraph (a)(1) is currently illegal under existing law and it will remain to be against the law. She stated that the commission has significant concerns regarding Section 2 (a)(2). The commission has no expertise in that field and that portion of this legislation would be better with an agency that has more expertise in the field of employment discrimination. She referred to page 2, subsection (c) and stated that it would cause members of labor unions or members of employee packs that use a payroll deduction program to have the information regarding their contributions even if it were less than $100, as public information. She stated that current law provides that each contributor who gives to the candidates campaign or to a political party or to a political action committee is made public on the disclosures submitted by those entities when it is more than $100. Contributors also have the responsibility to file a disclosure report when they give more than $250, which will be changed in June. She stated that the fiscal note to some extent reflects the commission's envisioning having to learn about employment discrimination. Number 0965 CHAIRMAN GREEN stated, "After disbursement in excess of $100 per year would that alleviate part of your concern?" Number 0981 MS. MILES replied that it would with that section. CHAIRMAN GREEN stated that it would be on page 2, line 15, Section (C). Number 1021 REPRESENTATIVE BUNDE made a motion to adopt Amendment 6. CHAIRMAN GREEN asked if there was an objection. REPRESENTATIVE ROKEBERG objected. Number 1053 REPRESENTATIVE JAMES stated that she was wondering if this was in the right place. She asked if they are talking about over $100 in total or on a individual basis. Number 1080 REPRESENTATIVE ROKEBERG stated, "I don't believe that anybody generally would be on the payroll-- it would have to be a very short term employee and I think that many companies have probationary periods or periods where they don't grant full benefits nor do they allow check-offs or things like that normally in an interim period. I would venture to say that the vast majority would amount under a $100 a year." He stated that this was a lot to do about nothing and maintains his objection. Number 1119 CHAIRMAN GREEN asked if that is the case that it is much to do about nothing why is Representative Rokeberg maintaining his objection. He stated that if most of the people are going to fall under this anyway it will just put them in the same category as those who contribute over $100 a year. Number 1136 REPRESENTATIVE ROKEBERG stated that it may require a segregation on information until they reach the threshold. CHAIRMAN GREEN stated that it is being done now. Number 1148 REPRESENTATIVE PORTER stated that would be his concern. He asked if it is a weekly deduction disbursement and if it is not over $100 would it not fall under this provision. Number 1215 REPRESENTATIVE JAMES stated that the language states "including a copy of each employee's written requests the amounts and dates funds were actually withheld and the amounts and dates funds were transferred to a group." She stated that it seems that they are asking for something other then whether the contribution is over $100. She stated that it is a requirement that already exists. She stated that she is beginning to think that the change is not needed. Number 1266 REPRESENTATIVE ROKEBERG asked Ms. Miles for the discussion of the commission on that point. He stated that under current APOC law people who contribute under $100 are not revealed, as a matter of bookkeeping not of confidentiality. Number 1300 MS. MILES replied that it is correct, although they are required to maintain the records in case APOC asks for them. She stated that the commission's primary concern is that it may have a chilling effect on an employee's willingness to participate in the program. Number 1329 REPRESENTATIVE JAMES stated that it is looking into payroll information to a certain extent, but in this case she did not see a problem with that. Number 1345 REPRESENTATIVE BERKOWITZ asked if there was a disbursement of less than $100 over a period of a year would that person's name be public information. MS. MILES replied no. REPRESENTATIVE BERKOWITZ asked if someone was to give his campaign $50, he would not have to publicize his name. MS. MILES stated that is correct, although the candidate would be responsible to maintain records regarding the contributor. Number 1382 REPRESENTATIVE BERKOWITZ stated that if he received more than $250 in aggregate, than his name would be public with APOC and both he and the contributor would have to send a form in. Number 1405 CHAIRMAN GREEN said, "If one goes over $100 (indisc.--talking) available, it's $250 when you get in the countdown days, you have to make that disclosure within days, you don't have to go to $250 before your name is published." REPRESENTATIVE BERKOWITZ stated that he thought all that was changed. Number 1414 MS. MILES stated that SB 175 did change that requirement. She stated that at the end of June, a contributor who gives $500 to a candidate or a group will be required to file an independent disclosure report within 30 days. Number 1443 CHAIRMAN GREEN asked if that is pertaining to the contributor. MS. MILES replied that is correct. CHAIRMAN GREEN stated that he was talking about the candidate reporting names for contributions over $100 has not changed. MS. MILES replied that is correct. Number 1457 REPRESENTATIVE BERKOWITZ asked if that information is publicly disclosed. MS. MILES stated that is correct. Number 1484 REPRESENTATIVE BERKOWITZ asked if someone in aggregate, through an organization gives him less than $100 directly, he would not have to report them and their name would not be public. MS. MILES replied that is correct. REPRESENTATIVE BERKOWITZ stated that the way the bill is written, in the course of keeping the records, that contributor's name would be publicized. Number 1560 MS. MILES replied that is the view of the commission. Number 1565 REPRESENTATIVE JAMES said, "You said, for people contributing to groups if they give more than $100 or whatever the group does not have to report where the money comes from? What is the level of reporting by groups, money going into the group?" MS. MILES replied that if she said that, she mis-spoke. A contribution to a group is treated just as a contribution to a candidate. If someone were to give $100 or less to a group there name, although recorded on the groups records, is not made public on their campaign disclosure statement. REPRESENTATIVE JAMES asked if someone were to contribute over $100 to a group their name will go down. MS. MILES stated that it is correct. Number 1579 CHAIRMAN GREEN stated that as this was written but if they only contribute $50 there name will public, which makes them different from other contributors. MS. MILES replied that is correct. Number 1589 REPRESENTATIVE JAMES stated that it is public but it is not necessarily reported to APOC. It is just made available during normal business hours. Number 1650 CHAIRMAN GREEN asked for a roll call vote. Representatives Berkowitz, Croft and Green voted in favor of the amendment. Representatives Porter, James and Rokeberg voted against the amendment. Amendment 6 failed. Number 1653 REPRESENTATIVE BERKOWITZ stated that he would like to propose an amendment on page 2, line 19-20 to delete the last sentence, "These documents and books of account are open to public inspection during normal business hours." REPRESENTATIVE ROKEBERG objected. REPRESENTATIVE BERKOWITZ stated that he could understand the need for an official governmental entity to look at this to ensure that there is no malfeasance but by having it open to public inspection any one could look at a company's business. He stated that as he understood the intent of this legislation, it is not to offer up the private parts of a union or a company for public inspection, it is to protect the individuals and their say in their paycheck. Number 1700 CHAIRMAN GREEN asked for a roll call vote. Representatives Berkowitz and Croft voted in favor of the amendment. Representatives Porter, James, Green and Rokeberg voted against the amendment. Amendment 7 failed. Number 1727 REPRESENTATIVE CROFT asked "Would it make it somewhat easier on the commission to have what we did, in other words to have approved by the commission rather than you guys having to design and distribute these forms." CHAIRMAN GREEN asked if he was referring to page 2, line 11. REPRESENTATIVE CROFT replied yes, if on line 11, to delete "prescribed" and insert "approved". Number 1743 MS. MILES stated that it would then require the individual companies to prepare their own forms and request the approval of the commission. She stated that she could not say which would be easier, the commission is in the business of prescribing forms but they can approve them too. Number 1770 REPRESENTATIVE JAMES stated that it seems to her that the form would only have to be prescribed once, but if you have to approve it, that will have to be done several times. Number 1783 REPRESENTATIVE ROKEBERG made a motion to rescind the committee's action on Amendment 2. REPRESENTATIVE CROFT objected. He stated that it would be more flexible for the individuals to be able to do it, as long as it is not in a discriminatory or biased manner. Number 1818 CHAIRMAN GREEN asked for a roll call vote. Representatives Berkowitz and Croft voted against rescinding Amendment 2. Representatives Porter, James, Green and Rokeberg voted in favor of rescinding Amendment 2. Amendment 2 was rescinded. Number 1854 REPRESENTATIVE BERKOWITZ asked Mr. Bennett what the inspiration for the bill is. MR. BENNETT replied that he would have to confess ignorance as he was not here when it was proposed last session and it was Joe Ambrose who monitored this legislation. REPRESENTATIVE BERKOWITZ asked, "And this GOPAC talking points?" Number 1903 MR. BENNETT replied that it just came in recently and he did not know why it has come in at this late date. REPRESENTATIVE BERKOWITZ stated that he is troubled by the fact that the policy they are generating here is being dictated by outside forces. REPRESENTATIVE JAMES stated that she objected. REPRESENTATIVE ROKEBERG stated that he objected to the objection. Number 1903 MR. BENNETT stated that he had only received the letter four days ago. Number 1910 REPRESENTATIVE BERKOWITZ stated that the other day they passed a bill out of committee regarding the source of outside money having an impact on the legislature's policy decisions. He stated that it is a valid concern. Number 1932 REPRESENTATIVE PORTER stated that the bill that Representative Berkowitz is referring to is a bill that is concerned with identifying the sources of the money that is influencing Alaskans as opposed to making appearances that they were Alaskans that had the money. He stated that there is not any testimony that there is a relationship between that piece of information and this piece of legislation. He stated that to the extent that there is some philosophical influence on the bill is not a secret. He stated that the legislature adopts things from the outside all the time. Number 1967 REPRESENTATIVE ROKEBERG stated that he has not had time to read any of the information from GOPAC and he probably will not. Number 1977 MR. BENNETT stated that he could solely be blamed for bringing this information to the committee. He stated that Senator Taylor did not ask him to bring the information to the committee. Number 1996 REPRESENTATIVE PORTER made a motion to move CSSB 114(JUD) AM out of committee with the attached fiscal notes and with individual recommendations. REPRESENTATIVE BERKOWITZ objected. He stated that he is concerned with the public inspection. He stated that the intent of the bill is to ensure an employee or union member has the right to check off when and to whom their contributions are going, subsection (c) goes far beyond that intent. He stated that it is a transparent attempt to open up the private workings of company or a union to public inspection, which will have a chilling effect on their ability to participate in the political process. He stated that it is a huge problem. Number 2045 REPRESENTATIVE CROFT stated that he is upset that some of the amendments were not adopted because at the core of the bill there is no disagreement that there ought to be disclosure. He stated that this bill makes it onerous and difficult for working Alaskans to work together to effect the public process. He said, "The primary effect left is going to be big businesses and very wealthy people. I think that is where we are headed and I know that is were GOPAC wants us to go." He stated that it disturbs him to see such obvious partisan bill drafting, there is an obvious nationwide agenda to do this across the state. He asserted either way working Alaskans will have less of a say in the political process. Number 2105 CHAIRMAN GREEN asked for a roll call vote. Representatives Berkowitz and Croft voted in against the bill. Representatives Porter, James, Green and Rokeberg voted in favor of the bill. Chairman Green stated that CSSB 114(JUD) AM moved from the House Judiciary Standing Committee. CSSB 158(L&C) - INSURANCE CHANGES FOR DR. LIC REVOC. Number 2159 CHAIRMAN GREEN announced the next order of business to be CSSB 158(L&C), "An Act relating to motor vehicle liability insurance covering a person who has had the person's driver's license revoked for possession or consumption of alcohol while under 21 years of age." RALPH BENNETT, Legislative Administrative Assistant to Senator Robin Taylor, Alaska State Legislature, read the following sponsor statement into the record: "Senate Bill 158 is an act relating to motor vehicle liability insurance covering a person who has had the person's driver's license revoked. The 'use it or lose it' provisions of current statute have had an unintended consequence on several Alaskans. Minors who lose their drivers licenses for minor consuming offenses often find themselves and their families with increased insurance premiums and occasionally a policy cancellation. "Senate Bill 158 would correct this situation by prohibiting an insurer from raising rates and/or canceling existing policies solely for suspension of a minor's drivers license as a result of minor consuming, and very importantly that is where not involving driving. This narrowly focused version for SB 158 does not address other offenses such as DWI, using false ID, or possession of controlled substances. "Section 1 adds language to the existing statute stating that AS 21.36.210 (a) (2) does not apply to an administrative revocation as described in AS 21.89.027, the new section which begins on page 2 of the bill. "AS 21.26.210 (a) specifies why an insurer may cancel a policy: nonpayment of premium or suspension or revocation of a drivers license. "Section 2 is the operative section of the bill and adds a new provision to state law. (a) says an insurer may not refuse to issue or renew motor vehicle liability insurance, cancel an existing policy, deny a covered claim, or increase the premium only because of an administrative or court ordered suspension for minor consuming. (b) says that (a) does not prevent an insurer from underwriting or rating a loss in the same manner as it would have had the suspension not occurred. "Section 3 says the bill would apply to policies issued or renewed on or after the effective date. This would mean that policies currently being charged a higher rate would have to be adjusted at the next renewal. Number 2259 REPRESENTATIVE ROKEBERG stated that this bill was heard in the House Labor and Commerce Standing Committee and he is real pleased with this bill. MICHAEL LESSMEIER, Lobbyist, State Farm Insurance, stated that he would reiterate what Representative Rokeberg said. He stated that State Farm Insurance worked very closely with Mr. Bennett. State Farm's concern was that sometimes non-driving behavior does carry over into driving behavior. He stated that this bill achieves the purpose. Number 2316 CHAIRMAN GREEN stated that they would hold the bill. CSSB 319(RLS) - ARBITRATION Number 2328 CHAIRMAN GREEN announced the committee would hear CSSB 319(RLS) "An Act relating to arbitration; amending Rules 57(a) and 77(g), Alaska Rules of Civil Procedure; and providing for an effective date." JERRY BURNETT, Legislative Assistant to Randy Phillips, Alaska State Legislature, stated that SB 319 requires that in a contract subject to arbitration language explaining the implications of arbitration is typed in capitol letters within in the arbitration agreement or on a separate document. This language will state clearly that a party to arbitration may be limiting or waiving rights to other remedies, including appeal of an arbitrator's decision to a court of law. He stated that the CSSB 319 (RLS) clarifies provisions that exclude labor management agreements unless the parties agree that they want to include an arbitration clause. It also adds that these provisions do not apply to personal injury claims, very small claims where the total consideration, not the amount to be arbitrated, is less than the small claims amount and insurance claims or annuity contracts. Number 2370 CHAIRMAN GREEN asked if he would explain why the Senator Phillips feels it is necessary to have it in large type. MR. BURNETT stated that the number of contracts commonly in use, including the Anchorage multiple listing service contract for the (indisc.) residents in Alaska, contain a provision that call for arbitration of disputes that arise under the contract. He stated that consumers who have signed these contracts, not knowing what their rights are and then have found themselves in a arbitration situations. He stated that there are no real rules prescribing who can be an arbitrator and if they have to follow Alaska law. He stated that people have unknowingly signed the contract and then wound up in an adverse situation with large attorney fees and no appeal to the courts. He stated that this law is modeled after a Montana Statute. Senator Phillips felt that it was necessary that consumers know what arbitration is and what rights they are giving up. Number 2450 REPRESENTATIVE PORTER asked what right are we giving up under arbitration. Number 2457 MR. BURNETT replied that they give up the right to appeal by signing a contract with an arbitration clause. Also they may be giving up the right to have a conflict resolved in a court of law. TAPE 98-84, SIDE B Number 0001 MR. BURNETT stated that it is listed in the bill page 2, line 31 through page 3, line 22. He stated that this is a list of the rights one may be giving up. He stated that the bill requires that the notice be read, it does not require that a person sign an arbitration agreement or that they waive their right to arbitration. CHAIRMAN GREEN asked if there are very many people who go to arbitration without a lawyer. Number 0060 MR. BURNETT stated that he imagined that there are but he could not speak to that. CHAIRMAN GREEN stated that the would assume that if one hired a lawyer they would be aware of all these issues and that this bill would be to protect the public who might what to do this without an attorney. Number 0082 MR. BURNETT stated that it is more to protect the public when they sign the original contract for the purchase of a home or the purchase of something else when it contains an arbitration clause, giving away their right to go to court. Number 0097 REPRESENTATIVE BERKOWITZ asked if the American Arbitration Association provided their opinion on this bill. MR. BURNETT replied not to his knowledge, although he believes they have heard of it. Number 0112 REPRESENTATIVE PORTER referred to page 2, line 8, and stated that it may not be the intent but it reads that "in order for an agreement to provide for arbitration, the agreement must contain a notice that states that the party has the option to compel arbitration to bind the other party to the arbitration decision and the arbitration limits the right and remedies otherwise under the law." He stated referred to the word "must" and stated it could be interrupted that the party who wishes to arbitrate must do it the way that it is stated. Number 0153 MR. BURNETT replied that he could not speak to that and unfortunately Bill McNall is not present, as he is the attorney that worked on it. He stated that the bill was reviewed by the and assistant Alaska attorney general and believes that it is an accurate statement. Number 0168 REPRESENTATIVE BERKOWITZ stated that it may be accurate but there is a huge internal inconsistency. He referred to lines 12-14, page 2 "parties to an arbitration agreement do not waive their rights to obtain a judicial determination." He stated and then the bill states that you will or may be limiting a dispute resolved in a court of law .... MR. BURNETT stated that if you read line 26, page 2 it states that you do not waive your right to obtain a judicial determination of whether a particular dispute is arbitrable. He stated that this is consistent with line 12-14. Number 0200 REPRESENTATIVE JAMES stated that it is not that one can not get to a judicial solution. Number 0209 CHAIRMAN GREEN said, "Would this be a chilling affect of ever having this in an agreement." Number 0239 REPRESENTATIVE ROKEBERG asked how many hearings has this bill had. MR. BURNETT replied it has been heard in the Senate Judiciary, Labor and Commerce and Rules. REPRESENTATIVE ROKEBERG asked if there are any witness from the real estate industry. Number 0257 MR. BURNETT replied that he discussed it with members of the industry and none of them had any opposition to it. They have neither testified against it or for it. REPRESENTATIVE ROKEBERG asked if there was a reason for the immediate effective date. Number 0276 MR. BURNETT stated that it was suggested by Bill McNall. REPRESENTATIVE ROKEBERG asked if he had thought of the ramifications of an immediate effective date. MR. BURNETT replied that it has not come up in any of the hearings. REPRESENTATIVE ROKEBERG stated that there would be a high cost to the state by having an immediate effective date. Number 0301 MR. BURNETT stated that the sponsor would agree that having an immediate effective date on that basis is not a good idea. Number 0313 REPRESENTATIVE ROKEBERG asked if the arbitration provisions allow for judicial appeal if there is a lack of satisfaction at arbitration. MR. BURNETT replied that they do not. REPRESENTATIVE ROKEBERG asked if that was in the definition of arbitration or could one appeal from an arbitrators ruling if one agreed to it prior to the arbitration. Number 0341 MR. BURNETT stated that he believed one could if it was mutually agreed to. However the Anchorage MLS agreement does not allow for it. Number 0348 REPRESENTATIVE ROKEBERG asked if Mr. Burnett was aware that this bill is labeled as a "make work for attorney's bill." MR. BURNETT replied that he has heard that concern expressed, however he stated that is not the sponsors intent. Number 0372 REPRESENTATIVE ROKEBERG asked how many witnesses in the various branches of the law testified for or against this bill. MR. BURNETT replied that two attorneys have testified on the bill. Number 0395 REPRESENTATIVE PORTER stated that he would like to read his changes that would make more sense in the bill. He stated that on line 10, page 2, delete "has" and insert "may have" after the word "party." After the word "arbitration" delete "and" and insert "or". He stated on line 11, insert "the" before "arbitration," insert "may" before the word "limits" and change that to "limit". He stated that on line 12, after the word "state," delete "that" and insert "whether". On line 13 delete "do not" after the word "agreement." Number 0478 MR. BURNETT stated that the sponsor's sole concern is to make sure that a person entering into an agreement, that contains an arbitration clause, has some type of notice that lets them know that they are waiving their constitutional rights to go to court. Number 0492 CHAIRMAN GREEN stated that with that in mind he would subscribe to the way Representative Porter has modified it as it reads easier. He asked if he is offering it as an amendment. REPRESENTATIVE PORTER made a motion to adopt Amendment 1. Number 0549 CHAIRMAN GREEN asked if there was an objection. Hearing none, Amendment 1 was adopted. Number 0549 REPRESENTATIVE ROKEBERG stated that he is nervous about the bill he does not think that it has had a proper hearing. He stated that the general public has not been noticed and the real estate industry is barely aware of its existence, if at all. He stated that to put this into a contract, particularly a real estate contract there should be some feedback from those people. Number 0613 REPRESENTATIVE JAMES asked if it would be proper to take this bill up the following day. Number 0624 REPRESENTATIVE BERKOWITZ stated that perhaps they could hear from the alternate dispute section of the bar tomorrow. Number 0639 CHAIRMAN GREEN stated that the committee will hold off on any further action on the bill and hold the bill over. CSSB 158(L&C) - INSURANCE CHANGES FOR DR. LIC REVOC. Number 0662 CHAIRMAN GREEN stated that they would take up HCSCSSB 158(L&C) again. REPRESENTATIVE BERKOWITZ made a motion to move HCSCSSB 158(L&C) out of committee with the attached fiscal notes and with individual recommendations. CHAIRMAN GREEN asked of there was an objection. Hearing none, HCSCSSB 158(L&C) moved from the House Judiciary Standing Committee. CSSB 274(FIN) am - PROBATION AND PAROLE FEES Number 0678 CHAIRMAN GREEN announced the committee would hear CSSB 274(FIN) am, "An Act relating to fees for probation and parole; relating to eligibility for a permanent fund dividend for persons convicted of and incarcerated for certain offenses; and relating to notice requirements relating to appropriations from the permanent fund dividend fund to the office of victims' rights." He stated that the sponsor is not in attendance, so they would take it up tomorrow. CSSB 232(JUD) - ELECTRONIC RECORDS; RECORD REQUIREMENTS Number 0678 CHAIRMAN GREEN announced the next order of business to be CSSB 232(JUD), "An Act relating to electronic signatures, electronic records, requirements for records, and the reproduction of public records." Number 0706 RICHARD VITALE, Legislative Assistant to Senator Sean Parnell, Alaska State Legislature, stated that the bill establishes electronic signature in law to be equivalent to a written signature and repeals some of the notarization requirements from the government to do business so they can use electronic signatures. Number 0716 REPRESENTATIVE PORTER asked if this was the same bill that the House Special Committee on Telecommunications heard. MR. VITALE replied that it is the same bill with the exception of the archiving provisions in it. The only amendment made on the Senate side was to put in a penalty of unsworn falsification site of statute and clarified that a certifying authority can be done by the state if the state is part of the exchange process of the electronic signature. He stated that if two private entities want to do so they do not have to come to the state to do it. Number 0750 REPRESENTATIVE PORTER made a motion to move CSSB 232(JUD), 0- LS1301\E. CHAIRMAN GREEN asked if there was an objection. Hearing none, CSSB 232(JUD), 0-LS1301\E, moved from the House Judiciary Standing Committee. HB 444 - PATERNITY CHILD SUPPORT ARREARS CHAIRMAN GREEN announced the final order of business to be HB 444, "An Act relating to paternity determinations; relating to extinguishment of child support arrearages and public assistance debt and to reimbursement of payments already made to the state on behalf of the child when paternity is administratively disestablished or a court determination of paternity is vacated; and amending Rules 60 and 90.3(h), Alaska Rules of Civil Procedure." SHIRLEY DEAN, Child Support Enforcement Division, Department of Revenue, stated that the division has not had time to research the legal and fiscal impacts of the legislation. However, the attorney general's office is working on it right now. CHAIRMAN GREEN asked if it would be appropriate to revisit this bill tomorrow. MS. DEAN stated that she would appreciate that. Number 0817 CHAIRMAN GREEN stated that HB 444 would be held over. ADJOURNMENT CHAIRMAN GREEN adjourned the House Judiciary Standing Committee at 3:48 p.m.