Legislature(2017 - 2018)ADAMS ROOM 519

03/01/2018 09:00 AM FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Moved CSHB 110(L&C) Out of Committee
-- Public Testimony --
Moved CSHB 176(FIN) Out of Committee
Moved CSHB 301(FIN) Out of Committee
Moved HB 168 Out of Committee
-- Public Testimony --
Moved HCR 10 Out of Committee
-- Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
Moved CSHB 38(FIN) Out of Committee
HOUSE BILL NO. 168                                                                                                            
     "An  Act relating  to regulation  notice and  review by                                                                    
     the  legislature; and  relating  to the  Administrative                                                                    
     Regulation Review Committee."                                                                                              
HOUSE CONCURRENT RESOLUTION NO. 10                                                                                            
     Proposing  an amendment  to the  Uniform  Rules of  the                                                                    
     Alaska State  Legislature relating to  the jurisdiction                                                                    
     of standing committees.                                                                                                    
9:49:16 AM                                                                                                                    
Co-Chair Foster indicated that HB168 and HCR 10 would be                                                                        
addressed together.                                                                                                             
REPRESENTATIVE MIKE CHENAULT, SPONSOR, introduced the                                                                           
legislation. He read from the sponsor statement as follows:                                                                     
     The  purpose  of  House  Bill  168  is  to  repeal  the                                                                    
     statutes  pertaining to  the Administrative  Regulation                                                                    
     Review  Committee  (AARC).  According to  the  analysis                                                                    
     provided  by  Legislative  Research, included  in  your                                                                    
     packets, the  ARRC has  not overturned  any regulations                                                                    
     as a  result of  these committee hearings.  Although AS                                                                    
     24.20.445  provides  that  the  committee  can  suspend                                                                    
     regulations  for a  "certain time  period," the  Alaska                                                                    
     Supreme  Court   found  in  a   1980  case,   that  the                                                                    
     Legislature  has  no  implied   power  to  veto  agency                                                                    
     regulations  by informal  legislative  action and  such                                                                    
     actions  would   violate  Article   II  of   the  state                                                                    
     Constitution. The actions available  to the ARRC are to                                                                    
     introduce   legislation   to   supersede   or   nullify                                                                    
     regulations.  However,  Legislative  Research  was  not                                                                    
     able  to find  any effort  to do  so from  2003 to  the                                                                    
     House  Bill  168 repeals  all  references  to the  ARRC                                                                    
     throughout   the  statutes.   The  sectional   analysis                                                                    
    references the statutes where the ARRC is repealed.                                                                         
     A uniform rule change,  House Concurrent Resolution 10,                                                                    
     is also being proposed  that allows the jurisdiction of                                                                    
     a  standing committee  to oversee  proposed or  adopted                                                                    
     regulations  to replace  regulation oversight  that are                                                                    
     currently under the jurisdiction of ARRC.                                                                                  
     The Administrative Regulation  Review Committee has not                                                                    
    been funded for this and the upcoming fiscal years.                                                                         
9:53:03 AM                                                                                                                    
Co-Chair Foster OPENED Public Testimony                                                                                         
9:53:22 AM                                                                                                                    
ED  MARTIN,  SELF,   COOPER  LANDING  (via  teleconference),                                                                    
opposed HB 168 and HCR  10. He thought the regulation review                                                                    
committee was  a first  line of defense  to ensure  that the                                                                    
regulations followed  the intent of  the law. He  hoped that                                                                    
the ARRC members felt that  the review of the regulations of                                                                    
any  new administration  was imperative.  He pointed  to the                                                                    
regulations  by   the  new   Marijuana  Control   Board  not                                                                    
reflecting the  intent of the  law and noted that  the issue                                                                    
affected  him personally.  He  argued  that the  regulations                                                                    
were  not reviewed  by  the AARC.  He  continued to  provide                                                                    
testimony  as  to  the importance  of  a  regulation  review                                                                    
committee to  ensure the  individual liberties  of Alaskans.                                                                    
He offered that the original  intent of the committee was to                                                                    
review  regulations  within  45  days  to  ensure  that  "no                                                                    
arbitrary and capricious laws" were enacted.                                                                                    
9:57:34 AM                                                                                                                    
Co-Chair Foster CLOSED Public Testimony.                                                                                        
Co-Chair  Foster encouraged  anyone to  submit their  public                                                                    
testimony in writing.                                                                                                           
Representative   Wilson   wanted   to   clarify   that   the                                                                    
legislature   was  eliminating   the   AARC.  However,   the                                                                    
regulation  review responsibilities  would  be  sent to  the                                                                    
standing committees. She opined  that the standing committee                                                                    
was a more appropriate for  review since the committee could                                                                    
draft  a bill  to  clarify the  statute.  She declared  that                                                                    
regulatory  review  was  important   and  ensured  that  the                                                                    
legislature was  not abandoning review; it  was changing the                                                                    
Co-Chair  Seaton related  that he  previously served  as the                                                                    
Vice-Chair for  the Regulation Review  Committee and  he had                                                                    
notified all the  chairs of the standing  committees that it                                                                    
was  the committee  aides'  responsibilities  to review  the                                                                    
regulations.  He explained  that  when  an agency  completed                                                                    
drafting regulations it opened  a public comment period; the                                                                    
corresponding   standing   committee   should   review   the                                                                    
regulations  and  participate  in  the  comment  period.  He                                                                    
reported  that during  his tenure  several regulations  were                                                                    
withdrawn and changed in that  manner. He emphasized that it                                                                    
was easier  to change  regulations on  the front  end rather                                                                    
than after  the regulation  was adopted via  legislation. He                                                                    
shared  that  a  Supreme  Court  decision  relating  to  the                                                                    
separation of powers  eliminated the AARC's power  to pass a                                                                    
resolution to  annul a regulation.  He believed that  it was                                                                    
the  responsibility of  the committee  of jurisdiction;  the                                                                    
corresponding  standing committee  that was  deeply involved                                                                    
in  the department's  matters over  which  they reside.  One                                                                    
committee  charged with  reviewing all  the regulations  was                                                                    
not   efficient.   He    emphasized   that   committees   of                                                                    
jurisdiction  were more  appropriate and  effective for  the                                                                    
regulatory review task.                                                                                                         
10:02:31 AM                                                                                                                   
Representative  Kawasaki   indicated  that  the   AARC  only                                                                    
functions with  a motivated chairperson.  He voiced  that he                                                                    
was  not in  favor of  the legislation  despite the  lack of                                                                    
results by the  committee in recent years.  He believed that                                                                    
the  committee serve  a public  purpose. He  reminded people                                                                    
that the  legislature was part-time  and the  AARC committee                                                                    
was  an interim  committee. He  did not  believe a  standing                                                                    
committee should  be responsible  for regulation  review due                                                                    
to its periodic nature. He  relayed that a recent regulation                                                                    
adopted by  the Alcohol  Control Board (ABC)  was discordant                                                                    
with  a  distillery bill  he  had  co-sponsored that  passed                                                                    
several  years ago.  He  thought that  the  AARC could  have                                                                    
prevented the  issue if  the committee  was utilized  to its                                                                    
fullest extent. He did not  want to see the executive branch                                                                    
over-riding the legislature.                                                                                                    
Representative Ortiz  asked what  the impact of  leaving the                                                                    
AARC  intact without  funding  was. Representative  Chenault                                                                    
answered that statutes  should be removed when  they are not                                                                    
needed. He  commented that  the AARC met  30 times  over the                                                                    
last   14  years.   Fifteen  meetings   occurred  over   one                                                                    
legislative session without ever  repealing a regulation. He                                                                    
indicated that as long as  there was a committee responsible                                                                    
for  reviewing  new  regulations  he  was  comfortable  with                                                                    
removing  the AARC.  He spoke  to incidences  throughout his                                                                    
legislative career  when he questioned regulations  and sent                                                                    
them to  the AARC  for review  without results.  He restated                                                                    
that the committee had not  proposed legislation since 2003.                                                                    
He advocated for the elimination of the committee.                                                                              
10:09:19 AM                                                                                                                   
Representative Ortiz  asked whether the  potential oversight                                                                    
ability of  the legislature  was impaired during  interim by                                                                    
eliminating  the committee.  He wondered  why the  committee                                                                    
should be  disbanded if there  were no financial  impacts to                                                                    
retain it.                                                                                                                      
Representative   Chenault   remembered  that   approximately                                                                    
$60,000  was  allocated  yearly for  regulation  review.  He                                                                    
noted the  committee was  governed under  the same  rules as                                                                    
standing committees  and could  not pass  legislation during                                                                    
10:11:34 AM                                                                                                                   
Vice-Chair Gara thought  the state had much  bigger items to                                                                    
be concerned with. He commented  that when an agency adopted                                                                    
regulations  every legislature  saw the  regulation and  was                                                                    
invited  to  make comments.  A  legislator  could change  or                                                                    
reverse  a regulation  through legislation  and a  committee                                                                    
was  unnecessary.   He  did  not   believe  that   the  AARC                                                                    
accomplished anything  and a significant amount  of time was                                                                    
consumed in the process.                                                                                                        
Co-Chair Seaton argued that every  committee had a full-time                                                                    
committee-aide and  it was  that person's  responsibility to                                                                    
review regulations during the  interim. He remarked that the                                                                    
committee staff had the expertise  to review regulations. He                                                                    
agreed that there was a cost  to the AARC. He indicated that                                                                    
a  lawyer  was  hired  to review  every  regulation  by  the                                                                    
administration  when  he  was vice-chair  of  the  AARC.  He                                                                    
reiterated that  the regulatory review should  happen on the                                                                    
front end during  the public comment period.  He shared that                                                                    
he had  seen regulations  changed many times  resulting from                                                                    
the public comment period.                                                                                                      
10:15:15 AM                                                                                                                   
TOM  WRIGHT,  STAFF  REPRESENTATIVE  CHENAULT,  provided  an                                                                    
example  when the  Department of  Transportation and  Public                                                                    
Facilities  (DOT)  recently proposed  aircraft  registration                                                                    
fees via  regulation and a  bill was drafted in  response to                                                                    
overwhelmingly negative  public comment.  He voiced  that he                                                                    
had   witnessed   legislation  by   individual   legislators                                                                    
introduced  in response  to  opposition  to regulation  many                                                                    
times over the years.                                                                                                           
Representative Ortiz  asked why the committee  had ever been                                                                    
formed.  Representative Chenault  was unable  to answer  the                                                                    
Vice-Chair  Gara recalled  that the  AARC was  instituted by                                                                    
the "other  party" in  response to  mistrust of  the Knowles                                                                    
administration  in   the  1990's.   He  believed   that  the                                                                    
committee  "diverted" legislator's  time for  more important                                                                    
issues. He emphasized that the committee was unnecessary.                                                                       
Co-Chair Seaton added  that at the time the  AARC was formed                                                                    
the legislature believed that  it could nullify regulations.                                                                    
However,  the  Supreme  Court subsequently  ruled  that  the                                                                    
chief function of the AARC was unconstitutional.                                                                                
Representative  Pruitt thought  that  the  inception of  the                                                                    
AARC went back  to the 1970s and the Supreme  Court case was                                                                    
in 1980 which did not allow  the review committee to act. He                                                                    
reminded  committee  members  that  the  legislature  acting                                                                    
together or  either body individually  can form  a committee                                                                    
via  resolution  and if  sentiment  among  lawmakers was  in                                                                    
favor of a special committee  action was possible. He agreed                                                                    
that  the committee  did  not  function in  the  way it  was                                                                    
intended. He  opined that  the idea of  the committee  was a                                                                    
good one, but he thought it  was time to "shut the books" on                                                                    
it in an effort to eliminate unnecessary statute.                                                                               
10:20:02 AM                                                                                                                   
Representative Wilson  asked about the  regulation regarding                                                                    
the aircraft  registration fee. She  asked whether  the AARC                                                                    
had met on the issue.  Representative Chenault answered that                                                                    
the    committee   was    currently   not    in   operation.                                                                    
Representative Wilson  opined that  the public  got involved                                                                    
in  the recent  DOT regulation  proposal and  the regulation                                                                    
was changed  during the public comment  period. The standing                                                                    
committees   were   inherently   involved,  had   a   better                                                                    
understanding of proposed regulations,  and could inform the                                                                    
public  of the  regulatory comment  period. She  agreed with                                                                    
Co-Chair Seaton  that standing committees had  the expertise                                                                    
and were best suited  to monitor regulations. She emphasized                                                                    
the importance of regulation review.                                                                                            
Co-Chair Foster asked whether the  will of the committee was                                                                    
to move the bill out of committee.                                                                                              
Representative Wilson believed the bills should report out.                                                                     
Co-Chair  Seaton MOVED  to report  HB 168  out of  Committee                                                                    
with individual recommendations  and the accompanying fiscal                                                                    
There being NO OBJECTION, it was so ordered.                                                                                    
HB  168 was  REPORTED  out  of committee  with  a "do  pass"                                                                    
recommendation  and   with  a   zero  fiscal  note   by  the                                                                    
Representative  Wilson  MOVED  to   report  HCR  10  out  of                                                                    
Committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal note.                                                                                                       
Representative Pruitt OBJECTED for discussion.                                                                                  
Representative Pruitt  spoke to his objection.  He wanted to                                                                    
briefly  describe  what   the  resolution  accomplished.  He                                                                    
explained  that  the  resolution assigned  the  jurisdiction                                                                    
over monitoring  regulations to the standing  committees. He                                                                    
opined  that the  resolution "maintained'  the legislature's                                                                    
"vigilance" in ensuring that regulations would be analyzed.                                                                     
Representative   Chenault   commented  that   Representative                                                                    
Pruitt was correct  about what the resolution  did. He added                                                                    
that  the resolution  changed Uniform  Rules  to ensure  the                                                                    
standing committees were aware of their jurisdiction.                                                                           
Representative  Kawasaki  maintained  his objection  to  the                                                                    
legislation.  He believed  that  the AARC  had a  definitive                                                                    
purpose as  a permanent  interim committee.  The legislature                                                                    
was never  intended to operate  full-time. He felt  that the                                                                    
committee  was  appropriate  and   should  be  enhanced.  He                                                                    
pointed to the state of  Idaho that had an active regulatory                                                                    
review  committee.  He  strongly   supported  the  AARC.  He                                                                    
opposed  the bills  but was  in  favor of  moving them  from                                                                    
Co-Chair Seaton appreciated the  resolution that would place                                                                    
the language  in the Uniform  Rules. The uniform  rule would                                                                    
specify  that regulation  review was  the responsibility  of                                                                    
standing  committees "in  black  and  white." The  committee                                                                    
chair would  task the  committee aide  with the  review duty                                                                    
during  the  interim.  He believed  the  resolution  clearly                                                                    
established that the  authority of the duty  was assigned by                                                                    
the legislature. He was supportive of the resolution.                                                                           
Co-Chair  Foster noted  that the  previous public  testimony                                                                    
period was for both bills.                                                                                                      
Representative Pruitt WITHDREW his OBJECTION.                                                                                   
HCR  10 was  REPORTED  out  of committee  with  a "do  pass"                                                                    
recommendation  and   with  a   zero  fiscal  note   by  the                                                                    
10:30:23 AM                                                                                                                   
AT EASE                                                                                                                         
10:33:50 AM                                                                                                                   

Document Name Date/Time Subjects
HB110 2.19.18 Letters of Support.pdf HFIN 3/1/2018 9:00:00 AM
HB 110
HB110 Sectional Analysis 2.15.18.pdf HFIN 3/1/2018 9:00:00 AM
HB 110
HB110 Sponsor Statement 2.15.18.pdf HFIN 3/1/2018 9:00:00 AM
HB 110
HB110(L&C) Explanation of Changes 2.16.18.pdf HFIN 3/1/2018 9:00:00 AM
HB 110
HB 168-Sectional Analysis-2018.pdf HFIN 3/1/2018 9:00:00 AM
HB 168
State v ALIVE Voluntary summary and headnotes-2018.pdf HFIN 3/1/2018 9:00:00 AM
HB 168
HB 168-Leg Research-Meetings-2018.pdf HFIN 3/1/2018 9:00:00 AM
HB 168
HB 168 Sponsor Statement-2018.pdf HFIN 3/1/2018 9:00:00 AM
HB 168
HCR 10-Uniform Rule 20-2018.pdf HFIN 3/1/2018 9:00:00 AM
HCR 10
HCR 10-Sponsor Statement-2018.pdf HFIN 3/1/2018 9:00:00 AM
HCR 10
HB110 - Support.pdf HFIN 3/1/2018 9:00:00 AM
HB 110
HB 110 Support Letter Gibbs.pdf HFIN 3/1/2018 9:00:00 AM
HB 110
HB 301 02.28.2018 DCCED HFIN Followup.pdf HFIN 3/1/2018 9:00:00 AM
HB 301