SENATE JUDICIARY COMMITTEE March 10, 1993 2:07 p.m. MEMBERS PRESENT Senator Robin Taylor, Chairman Senator Rick Halford, Vice-Chairman Senator George Jacko Senator Dave Donley Senator Suzanne Little OTHERS PRESENT Senator Fred Zharoff COMMITTEE CALENDAR SENATE JOINT RESOLUTION NO. 9 Relating to an amendment to the Constitution of the United States prohibiting desecration of the Flag of the United States. SENATE BILL NO. 105 "An Act relating to motor vehicle dealers and to agents for motor vehicle buyers; and providing for an effective date." HOUSE BILL NO. 90 "An Act making corrective amendments to the Alaska Statutes as recommended by the revisor of statutes; and providing for an effective date." HOUSE JOINT RESOLUTION NO. 21 Honoring Thurgood Marshall, 1908 - 1993. PREVIOUS SENATE COMMITTEE ACTION SJR 9 - See Judiciary minutes dated 2/22/93. SB 105 - See Labor and Commerce minutes dated 2/25/93. HB 90 - NONE. HJR 21 - NONE. WITNESS REGISTER Col. James Carlton, Ret. American Legion Veterans of Foreign Wars 1043 Woodland Ketchikan, Alaska 99901 POSITION STATEMENT: Supported SJR 9. Mst. Sgt. Rodney Love, Ret., Commander, American Legion Veterans of Foreign Wars 887 Monroe Street Ketchikan, Alaska 99901 POSITION STATEMENT: Supported SJR 9. Colonel Earl Mickelsen, Ret. American Legion P.O. Box 4409 Kodiak, Alaska 99615 POSITION STATEMENT: Supported SJR 9. Joseph Craig American Legion 2323 First Avenue Ketchikan, Alaska 99901 POSITION STATEMENT: Supported SJR 9. Jeffery Blume Coast Guard Petty Officer, Ret. Secretary, Harley Riders Box 7213 Ketchikan, Alaska 99901 POSITION STATEMENT: Supported SJR 9. Tom Streeper Air Force Officer, Ret. Box 7213 Ketchikan, Alaska 99901 POSITION STATEMENT: Supported SJR 9. Joe Ambrose, Aide Senator Robin Taylor State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Testified on SB 105. Joe Hayes Alaska Auto Dealers P.O. Box 101821 Anchorage, Alaska 99510 POSITION STATEMENT: Supports SB 105. David Dierdorff, Attorney Revisor of Statutes Legislative Legal Counsel Legislative Affairs Agency 130 Seward Street #414 Juneau, Alaska 99801 POSITION STATEMENT: Testified on HB 90. ACTION NARRATIVE TAPE 93-24, SIDE A Number 001 Chairman Robin Taylor called the Judiciary Committee meeting to order at 2:07 p.m. SENATOR TAYLOR returned SJR 9 (DESECRATION OF U.S. FLAG) to committee and began taking testimony on teleconference from Kodiak and beginning with Ketchikan, where he called on JAMES CARLTON. He checked in as COLONEL J. CARLTON, Retired U.S. Air Force, reviewed his record, and indicated he was a member of both the American Legion and the Veterans of Foreign Wars. In remembrance of the last medal of honor winner in his outfit, CAPTAIN STEPHEN L. BENNETT, COL. CARLTON asked the committee to pass the resolution now. He claimed the majority of Alaskan supported the resolution, which has been passed in 28 states. SENATOR TAYLOR noted the prime sponsor, SENATOR FRED ZHAROFF, had arrived and invited him to testify. Number 064 SENATOR ZHAROFF gave thanks for the opportunity to again support SJR 9, and he explained how it was lost in the final hours of session last year. He explained how his bill related to the attempt to amend the U.S. Constitution, and he hoped the resolution could be pushed through the Legislature quickly. SENATOR TAYLOR thanked SENATOR ZHAROFF for his participation and turned the testimony to Ketchikan to hear MASTER SERGEANT RODNEY LOVE, RET. SERGEANT LOVE read a statement from one of the members of the American Legion in a tribute to the American Flag as a reminder of the armed services fighting for the United State, and he urged the legislature to follow the other 28 states in support of a Constitutional amendment on the flag desecration. He conclude with a poem written a by student, LEE ESTES, from Jackson, Louisiana, in honor of Veteran's Day. SENATOR TAYLOR returned to Kodiak to hear COLONEL EARL MICKELSEN, RET. Number 153 COL. MICKELSEN expressed appreciation to SENATOR ZHAROFF for the introduction of SJR 9. He noted a House Resolution and asked that the two be combined. He described the support for the resolution from the Kodiak American Legion, the Western District, and the Southeastern District, which have all gone on record with resolutions asking for quick passage of the legislation. He asked that the resolution be passed, not only for our flag, but our veterans - and for our nation. SENATOR TAYLOR returned to Ketchikan for the remainder of the testimony, beginning with JOSEPH CRAIG. MR. CRAIG referred to a discussion with SENATOR TAYLOR on the issue and stressed the American Legion would be supporting the resolution next year if it doesn't pass. Number 223 JEFFERY BLUME identified himself as a Retired Vietnam Era Coast Guard Petty Officer, current member of the Legion Post Association. He discussed the flag as a national symbol and recognized daily at sporting events, schools, and at motorcycle rallies. He urged Alaska to join the 28 other states in supporting the Constitutional amendment. TOM STREEPER identified himself as a Retired Air Force Officer and a veteran of World War II, as well as the Korean War. He concurred with the previous speakers and explained the support for the resolution went beyond the military to all walks of life. SENATOR JACKO moved to pass SJR 9 (DESECRATION OF U.S. FLAG) from committee with individual recommendations. Without objections, so ordered. SENATOR TAYLOR introduced SB 105 (MOTOR VEHICLE DEALERS & BUYERS' AGENTS) as the prime sponsor, and he described the circumstances which led to his introduction of the bill. Number 272 SENATOR TAYLOR said the bill was introduced to prevent some fly-by-night car dealers, who act as brokers, take the money, and may or may not buy a car for a person. In Southeast, a broker took a lot of money, but never sent titles to some cars, and in some cases, sent no car. He described the mess in dealing with missing money and repossessed cars. SENATOR LITTLE asked for more information on what the bill would do, and SENATOR TAYLOR said he would defer to someone more knowledgeable. SENATOR JACKO asked if the bill was applicable to snow machines, outboards, or all-terrain vehicles. SENATOR TAYLOR asked his aide, JOE AMBROSE to comment on the bill and address SENATOR JACKO'S question. MR. AMBROSE thought it would depend on the definition of a motor vehicle, but indicated it might need a different title. SENATOR LITTLE asked MR. AMBROSE to describe what the legislation does. He explained the bill basically tightens up the definition of an "automobile dealer," and then adds a new provision identifying "a buyer's agent." He explained a buyer's agent as a person who does business in the state by negotiating on behalf of a buyer to purchase a motor vehicle from a motor vehicle dealer. He said the intent was to differentiate between a legitimate automobile dealer and a person who buys a car for another person, which them makes it a second owned vehicle with warrantee problems. He had a couple of other concerns dealing with a warrantee and rental cars, and he gave an example of a broker who collected money and disappeared. Number 345 SENATOR LITTLE asked if these were stolen cars. MR. AMBROSE outlined a different situation not covered in the law, and he said the bill listed some specifics that must be done by a buyer's agent for consumer protection. SENATOR LITTLE questions sparked a discussion of penalties, holding funds in trust in a buyer's account, delivery of the vehicles, transfer of title, purchasing agents, and purchase agreements. SENATOR JACKO asked if the purchase agent must be registered somewhere that can be checked. MR. AMBROSE thought they had to be licensed. SENATOR JACKO described a situation in his district during PFD time, when a bogus purchasing agent collected about $45 thousand in dividend checks to buy snow machines and four-wheelers - but never delivered them. SENATOR TAYLOR wanted to hold the bill for amendments that would prevent a re-occurrence of the problem in SENATOR JACKO'S district. Number 408 SENATOR TAYLOR explained the problem he saw in fraudulent ads promising a good deal by brokers, who purchase the car and a warrantee problem. He wanted to prevent such transactions. He and SENATOR JACKO discussed the fraudulent deals in their districts. SENATOR TAYLOR entertained a motion to adopt CS FOR SENATE BILL NO. 105 (JUD), BANNISTER, 3/2/93 and SENATOR JACKO so moved. Without objections, so ordered. MR. AMBROSE outlined the changes between the original and the committee substitute. On page 1, line 5, he explained language which was added to protect both the consumer and the dealer, and on page 3, line 5, specific warrantee restrictions. He directed the committee to page 3, line 15 to discuss provisions for the money in the transaction, and they discussed the problems involved. SENATOR JACKO asked if the agent was going to be required to be bonded, and MR. AMBROSE referred the question to someone who could explain bonding requirements. JOE HAYES, representing the Alaska Auto Dealers Association, testified in support of the bill. SENATOR TAYLOR made known his intent to return the bill on Friday, to allow time to accommodate SENATOR JACKO'S inclusion of other vehicles and additional questions by SENATOR LITTLE. Number 475 MR. AMBROSE said he knew there was a bonding requirement and would look for it. SENATOR TAYLOR introduced HB 90 (1993 REVISOR'S BILL) and asked the revisor, DAVID DIERDORFF, to explain the changes. MR.DIERDORFF explained it was the shortest revisor's bill in the history of the state by the longest tenured revisor. He mentioned he had previously sent two amendments for the bill, A1, which adds new sections 8, 9, 17, 18, and some language to the repealer. MR. DIERDORFF explained A1 removed some obsolete references in the statute to old coordinating councils required under federal law years ago in dealing with some health care issues. The federal law has been changed and the councils are no longer in effect. He said the Departments of Revenue, Health and Social Services, and Law have looked at the changes and all signed off on the changes. MR. DIERDORFF noted the another amendment, A2, rewrites part of the Insurance Code which didn't make sense and violated some of the basic rules about statute drafting. He reasoned the Insurance Code was a monster bill written by insurance lawyers, but doesn't make any substantive change. Omitted in the new Section 13 was the word "weighting factors," and he referenced Section 12 for identical wording. There was some general discussion of the changes with explanations by MR. DIERDORFF. SENATOR TAYLOR also explained to SENATOR LITTLE that any substantive changes had to be in a separate bill. Number 550 SENATOR LITTLE noted a change on page 2, line 24 which referred to Anchor Point in her district. MR. DIERDORFF explained it marked the entrance to Kachemak Bay on the SW coast of the Kenai Peninsula, and the reference was to correct an error in the survey. SENATOR LITTLE moved to adopt Amendment #1. Without objections, so ordered. SENATOR LITTLE moved to adopt Amendment #2 as amended. Without objections, so ordered. MR. DIERDORFF reviewed the sectional analysis ... TAPE 93-24, SIDE B Number 001 as removing obsolete material, fixing errors or oversights, and adding language in Section 12 dealing with the ethics committee. SENATOR JACKO moved to pass SENATE CS FOR HOUSE BILL NO. 90(JUD) (1993 REVISOR'S BILL) from committee with individual recommendations. Without objections, so ordered. SENATOR TAYLOR returned SB 105 (MOTOR VEHICLE DEALERS & BUYERS' AGENTS) to committee after having research done to answer concerns from SENATOR JACKO as to whether snow machines and all-terrain vehicles were covered. SENATOR LITTLE clarified that these vehicles were covered, too. SENATOR TAYLOR reviewed the definition of motor vehicles and explained to SENATOR DONLEY his reasons for sponsoring the bill. SENATOR JACKO asked if the agents were bonded, and SENATOR LITTLE declared the dealers should be both bonded and licensed. SENATOR TAYLOR thought this was already in statute. SENATOR JACKO moved to pass SENATE BILL NO. 105 (MOTOR VEHICLE DEALERS & BUYERS' AGENTS) from committee with individual recommendations. Without objections, so ordered. SENATOR TAYLOR introduced CS FOR HOUSE JOINT RESOLUTION NO. 21(JUD) (IN MEMORIAM THURGOOD MARSHALL) and praised the information on the resolution. SENATOR LITTLE moved to approve the resolution with individual recommendations. Without objections, so ordered. There being no further business to come before the committee, the meeting was adjourned at 3:15 p.m.