SENATE LABOR AND COMMERCE COMMITTEE March 9, 1993 1:40 p.m. MEMBERS PRESENT Senator Tim Kelly, Chairman Senator Steve Rieger, Vice Chairman Senator Drue Pearce MEMBERS ABSENT Senator Georgianna Lincoln Senator Judy Salo COMMITTEE CALENDAR SENATE BILL NO. 117 "An Act making appropriations for contract settlement costs and cost-of-living adjustments for public employees who are members of certain collective bargaining units; and providing for an effective date." SENATE BILL NO. 141 "An Act extending workers' compensation coverage to certain high school students in uncompensated work-study programs." SENATE BILL NO. 87 "An Act extending the termination date of the Alaska Public Utilities Commission to June 30, 1994." PREVIOUS SENATE COMMITTEE ACTION SB 117 - No previous action to record. SB 141 - No previous action to record. SB 87 - No previous action to record. WITNESS REGISTER Nancy Bear Usera, Commissioner Department of Administration P.O. Box 110200 Juneau, Alaska 99811-0200 POSITION STATEMENT: Commented on SB 117. Cheryl Frasca, Director Budget Review Office of the Governor P.O. Box 110020 Juneau, Alaska 99811-0020 POSITION STATEMENT: Commented on SB 117. Marsha Hubbard, Director Statewide Budget University of Alaska 910 Yukon Dr. Fairbanks, Alaska 99575 POSITION STATEMENT: Commented on SB 117. Representative Bettye Davis Capitol Bldg. Juneau, Alaska 99811-1284 POSITION STATEMENT: Supported SB 141. Brad Thompson, Deputy Director Division of Risk Management Department of Administration P.O. Box 110218 Juneau, Alaska 99811-0218 POSITION STATEMENT: Commented on SB 141. Frank Cox SBA 3111 Briarcliff Anchorage, Alaska 99508 POSITION STATEMENT: Commented on SB 141. Bob Lohr, Director Alaska Public Utilities Commission 1016 W. 6th Ave., #400 Anchorage, Alaska 99501 POSITION STATEMENT: Commented on SB 87. ACTION NARRATIVE TAPE 93-18, SIDE A Number 001 SENATOR KELLY called the Labor and Commerce meeting to order at 1:40 p.m. and announced SB 117 APPROP: CONTRACT SETTLEMENT COSTS to be up for consideration. NANCY USERA, Commissioner, Department of Administration, summarized the terms of the contract that SB 117 appropriated funds for. On health coverage the same coverage was maintained, some long term benefits were given up. There was a 3.6% cost of living increase. COMMISSIONER USERA said there are 11 different bargaining units in Alaska. She said the contract had the terms allowed under the 423 plan and that ASEA was not included in the negotiations. The contract covered approximately two thirds of state employees. Number 249 CHERYL FRASCA, Division of Budget Review, said there were approximately 16,500 state employees. Number 270 MARSHA HUBBARD said they had resolved the disputes in the University budget and that the University is self insured. SENATOR KELLY asked how they had any leverage in negotiating for health benefits. MS. HUBBARD said basically they tell the employees how much money they have to deal with and let them decide what they want in terms of insurance. Number 320 SENATOR KELLY announced SB 141 WORKERS' COMP FOR WORK-STUDY STUDENTS to be up for consideration. REPRESENTATIVE BETTY DAVIS said that right now employers will not hire anyone under the age of 18 because the cost worker's compensation liability triples for people under 18. The head of a waste firm told her he would allow students to gain on-the-job training at his facility in a work-study program if this bill were in place. SENATOR KELLY asked if anyone had experience with the current existing non-profit program. REPRESENTATIVE DAVIS said that would come from the Career Center, because they already have this component of the program. However, most of the placements are in the private sector. There would be an estimated 50 students state-wide coming into this program. SENATOR KELLY asked what would the $100,000 in the fiscal note be used for? Number 400 FRANK COX, SBA, answered this covers the anticipated cost of claims for a year. This figure comes from their own experience with the average per claim cost being $6500. Statistics from the Department of Labor indicate ten percent of their employees have incurred worker's compensation claims. Of people 18 years old and younger, 425 claims per year are an average. SENATOR KELLY said his concern with worker's compensation was paying them a salary if they get hurt where they don't get a salary if they're training. REPRESENTATIVE DAVIS said they were trying to cover the liability aspect of it. She said that there are very few students under the age of 18 that actually drew some money in 1991. According to statistics she had, there were 310 claims with an average payment of $1,000. If 10% of the people covered draw workmen's compensation, the estimate should be closer to $50,000. FRANK COX commented that the students train only 2 - 3 hours a day. BRAD THOMPSON, Department of Administration, said they don't have a position on SB 141. REPRESENTATIVE DAVIS pointed out that most young people are very healthy and seem to bounce back really soon if they are injured. She didn't think a small wage would be an incentive for the to claim workmen's compensation, because they are also trying to graduate from school. If they should take longer, they could loose all of their credits. SENATOR KELLY closed the hearing on SB 141 and announced SB 87 to be up for consideration. Number 527 BOB LOHR, Executive Director, Alaska Public Utilities Commission, said the Commission protects the public interest by certificating and economically regulating only qualified public utilities and pipeline carriers. It oversees the availability, affordability, and quality of the utility services which are essential to Alaska's economic development. MR. LOHR and SENATOR KELLY briefly discussed the APUC budget. Number 541 SENATOR KELLY asked if it was common for a legislative committee to recommend a 10 year sunset on an agency. SENATOR PEARCE explained that the Governor's Task Force on Boards and Commissions recommended that the sunset be continued. She personally thought that a 10 year sunset does away with the reason for having a sunset. Reviewing the APUC in four or five years makes sense, because there are so many changes in technology. Legislative Audit recommended the engineering seat be staggered an idea the Commission supported. SENATOR KELLY thanked Mr. Lohr and adjourned the meeting at 4:28 p.m.