Legislature(2017 - 2018)BARNES 124

03/24/2017 03:15 PM House LABOR & COMMERCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
Moved HB 144 Out of Committee
-- Public Testimony --
Moved HB 86 Out of Committee
-- Public Testimony --
Heard & Held
            HB 132-TRANSPORTATION NETWORK COMPANIES                                                                         
4:17:00 PM                                                                                                                    
CHAIR KITO announced that the final order of business would be                                                                  
HOUSE BILL NO. 132, "An Act relating to transportation network                                                                  
companies and transportation network company drivers."                                                                          
4:17:30 PM                                                                                                                    
REPRESENTATIVE JOSEPHSON moved to adopt Amendment 1, Version 30-                                                                
LS0522\J.3, which read as follows:                                                                                              
     Page 10, line 4, following "Records.":                                                                                   
          Insert "(a)"                                                                                                          
     Page 10, following line 11:                                                                                                
          Insert new material to read:                                                                                          
          "(b)  Except for specific information about a                                                                         
     transportation  network  company rider,  including  the                                                                    
     rider's   name,  address,   and  telephone   number,  a                                                                    
     transportation   network   company  shall   provide   a                                                                    
     transportation  network  driver  information  for  each                                                                    
     ride   the    driver   completes,    including   global                                                                    
     positioning data, the  fare and tip paid  by the rider,                                                                    
     and the rate charged.                                                                                                      
          Sec. 28.23.130. Collective bargaining agreement.                                                                    
     To   the   extent   allowed    by   federal   law   and                                                                    
     notwithstanding AS 28.23.080,                                                                                              
               (1)  transportation network company drivers                                                                      
     may  organize  for  the  purpose   of  mutual  aid  and                                                                    
     protection and may designate a bargaining agent;                                                                           
               (2)  a transportation network company and an                                                                     
     organization of transportation  network company drivers                                                                    
     may negotiate, enter into,  and administer a collective                                                                    
     bargaining  agreement concerning  wages, benefits,  and                                                                    
     other terms  and conditions relating to  work performed                                                                    
     by the transportation network company drivers;                                                                             
               (3)  a municipality where a transportation                                                                       
     network company  operates may regulate  conduct allowed                                                                    
     under (1) and (2) of this section.                                                                                         
          Sec. 28.23.140. Prohibitions. A transportation                                                                      
     network company may not                                                                                                    
               (1)  take adverse action against a                                                                               
     transportation   network   company  driver,   including                                                                    
     restricting   the  driver's   tips  or   suspending  or                                                                    
     terminating   the   driver's   participation   in   the                                                                    
     company's digital network, as a result of the driver                                                                       
               (A)  organizing or joining a driver                                                                              
     association   or  labor   organization,  including   an                                                                    
     organization under AS 28.23.130,  or participating in a                                                                    
        driver association or labor organization or the                                                                         
         activities of the driver association or labor                                                                          
               (B)  decreasing the driver's participation                                                                       
     in the company's digital network; or                                                                                       
               (C)  generating less fare or tip income;                                                                         
     (2)  change a compensation  rate or other material term                                                                    
     of  a  contract  with  a driver  without  the  driver's                                                                    
     voluntary prior  consent, if the  contract is  based on                                                                    
     the  driver  providing  a   ride  to  a  transportation                                                                    
     network company rider."                                                                                                    
REPRESENTATIVE WOOL objected.                                                                                                   
4:17:38 PM                                                                                                                    
REPRESENTATIVE  JOSEPHSON explained  that he  had consulted  with                                                               
labor lawyers and  the legislature's lawyers, and  although it is                                                               
not  conventional, there  is nothing  prohibiting the  option for                                                               
transportation network  companies (TNC)  workers in the  state to                                                               
organize,  even as  independent contractors.   He  noted a  First                                                               
Amendment right of association, mutual aid, and protection.                                                                     
4:19:09 PM                                                                                                                    
REPRESENTATIVE  JOSEPHSON continued  that  the  National Labor  &                                                               
Relations Act  concerns itself  with employees,  but it  does not                                                               
speak to  independent contractors.   He explained his  concern is                                                               
for  the  TNC  drivers who  may  come  to  learn  it is  not  the                                                               
lucrative profession they may have  believed because they have to                                                               
pay  for gasoline,  any injuries  sustained on  the job,  and any                                                               
repairs.   This amendment  gives drivers  an option  to organize,                                                               
and  there is  the potential  for a  much larger  pool of  people                                                               
statewide  than taxi  drivers.   Frankly, he  said, drivers  need                                                               
authority  to   work  collectively  because   individual  drivers                                                               
working  separately will  have a  hard time  asking the  TNCs for                                                               
4:21:04 PM                                                                                                                    
REPRESENTATIVE BIRCH spoke against the  amendment noting a lot of                                                               
communication from  AKTeamsters.com objecting to  ridesharing and                                                               
TNCs, and this  effort to propose an  organizational structure is                                                               
a wrench in the  works at this late date.   He described that the                                                               
amendment was  not constructive  because, otherwise,  there would                                                               
be  organized taxi  drivers everywhere.    He said  he could  not                                                               
support   the  amendment   because  it   is  not   reasonable  or                                                               
constructive in the path forward enabling TNCs in Alaska.                                                                       
4:21:56 PM                                                                                                                    
REPRESENTATIVE  WOOL  related  that   he  does  not  support  the                                                               
amendment   and  opined   that  under   federal  law   collective                                                               
bargaining   with  independent   contractors   is  not   allowed.                                                               
Seattle,  Washington  did pass  an  ordinance  about TNC  drivers                                                               
organizing and  he noted that  the drivers have  not successfully                                                               
organized at this point.                                                                                                        
4:23:00 PM                                                                                                                    
CHAIR KITO commented that the  discussion to organize TNC drivers                                                               
should  encompass a  larger discussion  from actual  drivers, and                                                               
since Alaska does  not have drivers, there is  not an opportunity                                                               
for TNC  drivers, or  possibly taxi  drivers, to  weigh in  as to                                                               
whether or not they would prefer  to organize.  He suggested with                                                               
this  larger discussion  there should  be in  a more  independent                                                               
piece of legislation,  and because there had  not been sufficient                                                               
discussion on this issue, he  does not support this amendment, he                                                               
4:23:57 PM                                                                                                                    
REPRESENTATIVE STUTES questioned  whether or not it  needed to be                                                               
put  in statute  because drivers  would have  the opportunity  to                                                               
organize if  they chose  to go  that route,  without it  being in                                                               
REPRESENTATIVE WOOL maintained his objection.                                                                                   
4:24:27 PM                                                                                                                    
A roll  call vote was  taken.  Representative Josephson  voted in                                                               
favor  of adopting  Amendment 1.   Representatives  Stutes, Wool,                                                               
Birch,  Knopp,  Sullivan-Leonard,  and  Kito  voted  against  it.                                                               
Therefore, Amendment 1 failed by a vote of 1-6.                                                                                 
4:24:53 PM                                                                                                                    
REPRESENTATIVE JOSEPHSON moved to  adopt Amendment 2, Version 30-                                                               
LS0522\R.1, which read as follows:                                                                                              
     Page 11, line 25:                                                                                                          
          Delete "or"                                                                                                           
          Insert "and"                                                                                                          
     Page 11, line 27, through page 12, line 13:                                                                                
          Delete all material and insert:                                                                                       
         "* Sec. 8. AS 29.35 is amended by adding a new                                                                       
     section to read:                                                                                                           
          Sec. 29.35.148. Regulation of transportation                                                                        
     network companies. (a) Notwithstanding AS 28.01.010, a                                                                   
     municipality may by ordinance                                                                                              
               (1)  prohibit a transportation network                                                                           
       company or driver from conducting activities under                                                                       
     AS 28.23 within the municipality; or                                                                                       
               (2)      regulate    the   operation   of   a                                                                    
      transportation network company or driver in a manner                                                                      
     that is at least as restrictive as or more restrictive                                                                     
     than the provisions of AS 28.23.                                                                                           
          (b)  This section applies to home rule and                                                                            
     general law municipalities.                                                                                                
          (c)  In this section, "transportation network                                                                         
        company" and "driver" have the meanings given in                                                                        
     AS 28.23.180."                                                                                                             
REPRESENTATIVE WOOL objected                                                                                                    
4:25:06 PM                                                                                                                    
REPRESENTATIVE  JOSEPHSON advised  that less  than 72-hours  ago,                                                               
the  Anchorage Assembly  passed  a 23-page  ordinance with  "much                                                               
more detail  than the  bill," by  a vote of  8-3.   The ordinance                                                               
listed any  manner of things  the assembly wanted to  regulate in                                                               
the  event this  bill does  become law.   The  ordinance requires                                                               
that:  customers would  be informed  when they  are riding  under                                                               
dynamic or  surge pricing;  the Municipality  Inspection Division                                                               
would inspect  cars annually; insurance  would be  cancelled, and                                                               
an application would  cease to operate if any  of the regulations                                                               
promulgated in  the ordinance were  not complied with;  TNC would                                                               
have  an  insurance schedule  comparable  to  the taxi  insurance                                                               
schedule.   In addition, there would  be an agent for  service of                                                               
process,  a  system for  lost  and  stolen  items; a  system  for                                                               
handling complaints,  a system to  handle post-incident  drug and                                                               
alcohol testing,  and issues  of violations  of alcohol  and drug                                                               
testing.  The ordinance requires  that: TNCs would be required to                                                               
check that  the driver is  not included on National  Sex Offender                                                               
Registry;  the city  would receive  a  list of  all TNC  drivers;                                                               
there would be  drug and alcohol testing if there  is an accident                                                               
or incident; the city would be  notified of any report of traffic                                                               
accidents  or injuries;  the city  would  preclude the  use of  a                                                               
vehicle for solicitation or prostitution;  TNCs could not be used                                                               
to tow  or carry a trailer.   The ordinance also  stipulates that                                                               
for vehicles that  can carry more than seven  people, there would                                                               
be  a  higher rate  of  insurance.    Page  20 of  the  ordinance                                                               
describes that in  the event of an accident  or litigation, there                                                               
would automatically "be all this  discovery."  He stated that the                                                               
ordinance: requires a process for  hearings of appeals of denials                                                               
of  licensure; establishes  that disabled  [riders] could  not be                                                               
charged more;  and lists  a 27-item fine  schedule, similar  to a                                                               
bail schedule.                                                                                                                  
4:28:56 PM                                                                                                                    
REPRESENTATIVE JOSEPHSON  offered that local governments,  due to                                                               
its taxis and "boots on the  ground," are in a better position to                                                               
regulate.  Local governments are cut  out and that is the problem                                                               
with the bill, he said.                                                                                                         
4:30:02 PM                                                                                                                    
REPRESENTATIVE  BIRCH  spoke  against Amendment  2,  noting  that                                                               
while  it   is  encouraging  that  the   Anchorage  Assembly  and                                                               
community  is supportive  of TNCs,  there  was significant  prior                                                               
testimony  pointing out  the problems  in having  a patchwork  of                                                               
different nuances  in every  different community.   He  said that                                                               
during  his ten  years  on  the assembly,  it  had long  standing                                                               
issues   in   trying   to   accommodate   public   transportation                                                               
requirements  into  Chugiak,  Eagle  River,  and  the  Matanuska-                                                               
Susitna areas.   The patchwork  problem comes  to a head  when it                                                               
becomes  necessary to  direct the  service  areas into  different                                                               
nuances on  how services  could be delivered.   He  described the                                                               
bill as a good workable product  to carry forward and stated that                                                               
the  safety   and  security  issues  have   been  addressed,  and                                                               
Amendment 2 would get the committee needlessly "tangled up."                                                                    
4:31:31 PM                                                                                                                    
REPRESENTATIVE KNOPP spoke in support  of Amendment 2, expressing                                                               
that  unique  issues  arise  in  the  various  communities  "they                                                               
operate in" and there is no better  place to fix the issues.  The                                                               
rules  written  in  the  bill  are  lenient  and  not  especially                                                               
restrictive,  yet  in  reality,  people do  not  get  to  operate                                                               
without  some type  of rules.    He stated  concern about  rating                                                               
passengers, such  as in the instance  of a passenger not  being a                                                               
big tipper and  therefore rated a "one," leading  to those people                                                               
waiting  a long  time for  the next  Uber ride.   Also,  he noted                                                               
concern about the  "mini-suite" application as to  buying 12 cars                                                               
and  putting  drivers  in  them because  now  they  are  actually                                                               
employees and he  stated that he was unsure how  that would work.                                                               
The point, he said, is that  there will be issues that arise, and                                                               
this amendment  provides the opportunity  for those issues  to be                                                               
4:33:46 PM                                                                                                                    
REPRESENTATIVE STUTES spoke  in support of Amendment  2, and that                                                               
she  is  in  favor  of  seeing Uber  come  into  communities  and                                                               
commented  that her  rural  Alaska community  is  confined to  an                                                               
island.  She said that both  the borough manager and city manager                                                               
are "exceedingly  concerned" about  these drivers coming  in with                                                               
no regulation,  when Kodiak's taxi cabs  are seriously regulated.                                                               
She has heard  from many of her constituents, living  in both the                                                               
city and  the borough, who believe  that it is alarming  to think                                                               
there would be  no regulation and they would have  no input as to                                                               
what went on with these drivers, she said.                                                                                      
4:34:54 PM                                                                                                                    
REPRESENTATIVE WOOL spoke in opposition  to Amendment 2, and said                                                               
he understands the concern of  municipalities, although, the case                                                               
in  point is  that  three individuals  on  the committee  support                                                               
municipal   regulations,  all   of  which   are  from   different                                                               
municipalities,  and  patchwork  is  part of  the  problem.    He                                                               
referred  to Lyft,  noting  that  it will  not  go  into a  state                                                               
without statewide legislation, and  stressed that Alaska wants to                                                               
be current and  innovative, and this technology  platform is used                                                               
in 49 states,  with 38 or 39 states  under statewide legislation.                                                               
Some  Alaskans  can practice  exceptionalism,  and  not care  how                                                               
things are run outside of Alaska,  and be without the TNC service                                                               
except,  he  said,  most  Alaskans  want the  TNC  service.    He                                                               
referred to the Anchorage ordinance  and advised that the Lyft or                                                               
Uber  contract contains  much of  what was  listed, and  drug and                                                               
alcohol  tests  are performed  by  law  enforcement following  an                                                               
accident.   As far as suites,  he opined, a group  of drivers are                                                               
not allowed to work under a driver.   The rating system is a very                                                               
good system, he  described, because rating makes  the TNC service                                                               
far superior  to the  experience of people  riding in  taxis, and                                                               
pointed out that over many  hours of testimony, not one testifier                                                               
complained about  TNC service.   Historically, larger  cities had                                                               
local control  when the service was  rolled out, but that  is not                                                               
going to happen in Alaska.   He offered that statewide control is                                                               
good and more  language could be added to the  bill in addressing                                                               
some of these concerns, but he  stated that he does not intend to                                                               
make  the bill  basically a  contract for  TNCs.   He asked  that                                                               
Annabel Chang address the issue of suites.                                                                                      
4:39:04 PM                                                                                                                    
REPRESENTATIVE KNOPP  offered a point  of order, noting  that the                                                               
committee is  addressing the amendment,  and asked  whether Chair                                                               
Kito planned to open it up to public testimony.                                                                                 
CHAIR KITO  ruled that there  is a question  as to the  impact of                                                               
the amendment and Lyft is being asked to respond.                                                                               
4:39:28 PM                                                                                                                    
ANNABEL CHANG,  West Coast Director,  Public Policy,  Lyft, asked                                                               
that the question be repeated.                                                                                                  
REPRESENTATIVE  WOOL  asked  about  drivers  subcontracting  with                                                               
other drivers.                                                                                                                  
MS.  CHANG explained  that  each individual  driver  on the  Lyft                                                               
platform must go through an  individual background check process,                                                               
including the  vehicle they drive.   For example, in the  event a                                                               
family shares a vehicle and the  wife wants to drive for Lyft and                                                               
it is  under her husband's  name, she  must be approved  to drive                                                               
that vehicle  and must be  listed on  the insurance.   The wife's                                                               
husband cannot drive that vehicle  because he was not approved to                                                               
drive  on the  Lyft platform  unless he  goes through  a separate                                                               
background check, driving  record check, and identity  check.  Of                                                               
course, she said,  when opening the app, the photo  of the actual                                                               
approved  driver pops  up so  the passenger  is aware  of who  is                                                               
actually picking them up before they even get into the vehicle.                                                                 
4:41:05 PM                                                                                                                    
CHAIR KITO asked  if an individual is operating as  a Lyft driver                                                               
when  they  activate the  app,  and  whether  there is  a  policy                                                               
regarding whether  or not that has  to be the individual  that is                                                               
MS. CHANG agreed,  and she said it would be  against the terms of                                                               
service  to have  anyone not  approved to  drive on  the platform                                                               
using  the   platform,  and  the   approved  person   would  risk                                                               
deactivation at  that point.   Of  course, she  noted, passengers                                                               
would have  notification because  they would  know when  they are                                                               
picked  up whether  the driver  matches the  photo on  the mobile                                                               
4:42:07 PM                                                                                                                    
REPRESENTATIVE KNOPP referred  to the last time she  spoke to the                                                               
committee when the issue of  "mini-suites" was brought up and Ms.                                                               
Chang had  agreed that it  was possible,  and asked how  it would                                                               
work if someone was to buy six cars and put drivers in the cars.                                                                
MS. CHANG  responded that Lyft  partners with General  Motors and                                                               
Enterprise   wherein  they   actually  lease   out  vehicles   in                                                               
partnership  with Lyft.   In  that situation,  she explained,  an                                                               
individual can lease out  a vehicle for a few weeks  at a time to                                                               
drive on the Lyft platform, and  prior to their approval to drive                                                               
on the  Lyft platform, they  must go through a  background check,                                                               
driving record check,  and their name and face must  be linked to                                                               
that vehicle  on the mobile  app.   There is always  a connection                                                               
between the approved  individual and the vehicle  before a person                                                               
is  allowed to  drive and  be activated  on the  mobile app,  she                                                               
4:43:38 PM                                                                                                                    
REPRESENTATIVE KNOPP offered a scenario  wherein someone leases a                                                               
car from Hertz, Budget, or Enterprise  and their names are not on                                                               
the title or with the insurance company.                                                                                        
MS.  CHANG  answered  that  the   individual  is  listed  on  the                                                               
insurance, and  insurance is provided  through General  Motors or                                                               
4:44:23 PM                                                                                                                    
REPRESENTATIVE  SULLIVAN-LEONARD said  she echoes  Representative                                                               
Birch's comments  because in the  taxi industry their  ability to                                                               
travel through  the Matanuska-Susitna  Valley, as an  example, is                                                               
rather  limited.   As  to the  arrival of  TNCs,  its freedom  of                                                               
movement and  moving passengers in  and around  the south-central                                                               
area  is an  important  component, and  the  thought of  actually                                                               
delineating between each municipality  is an incredible patchwork                                                               
that  should be  avoided, she  said.   The current  bill contains                                                               
regulations in  place, there will  be a requirement  for business                                                               
licensing, sales  tax collection, and disbursement  to the cities                                                               
requiring  those  collections  and,  she  stated,  she  does  not                                                               
support Amendment 2.                                                                                                            
4:45:55 PM                                                                                                                    
REPRESENTATIVE  STUTES  acknowledged  that she  was  mistaken  in                                                               
thinking there was  an opt-in clause for a  municipality and have                                                               
the  opportunity for  local control.   She  suggested a  friendly                                                               
amendment adding an opt-in clause.                                                                                              
REPRESENTATIVE  JOSEPHSON advised  that Amendment  2 would  allow                                                               
municipalities to  opt-in and  referred to  Amendment 2,  page 1,                                                               
lines 8-9, which read as follows:                                                                                               
          Sec. 29.35.148. Regulation of transportation                                                                        
     network companies.  (a) Notwithstanding AS 28.01.010,                                                                    
     a municipality may by ordinance                                                                                            
4:46:58 PM                                                                                                                    
CHAIR  KITO referred  to Amendment  2, page  1, lines  8-11, Sec.                                                               
29.35.148, which read as follows:                                                                                               
        (a) Notwithstanding AS 28.01.010, a municipality                                                                        
     may be ordinance                                                                                                           
         (1)   prohibit   a   transportation   network                                                                          
     company or driver from conducting activities under AS                                                                      
     28.23 within the municipality; or                                                                                          
CHAIR KITO described that Amendment  2 would allow a municipality                                                               
to opt-out.                                                                                                                     
REPRESENTATIVE STUTES  asked whether  that is opposed  to opting-                                                               
CHAIR KITO answered in the affirmative.                                                                                         
4:47:35 PM                                                                                                                    
REPRESENTATIVE  BIRCH commented  that  while  he appreciates  the                                                               
testimony of Ms. Chang, his  concern still stands when looking no                                                               
farther  than the  language  in this  amendment  which speaks  to                                                               
prohibiting  and  regulating  a  TNC.    He  opined  that  it  is                                                               
commendable  that  there is  support  for  the  TNC, and  if  the                                                               
committee wants  TNCs to operate in  Alaska, it needs to  be in a                                                               
uniform manner.   That responsibility rests  with the legislature                                                               
and  the oversight  and regulation  would be  incumbent upon  the                                                               
legislature, and he  does not believe this  amendment adds value,                                                               
he advised.                                                                                                                     
4:48:42 PM                                                                                                                    
REPRESENTATIVE  WOOL  referred  to  the  opt-out  provision,  and                                                               
advised that Fairbanks is a city  and a borough, and the city and                                                               
borough  are  sandwiched  on  top  of each  other,  it  would  be                                                               
complicated  if the  city  chose  to opt-out.    For example,  he                                                               
explained, he lives in the City  of Fairbanks and if he wanted to                                                               
be picked up by a TNC, he must  then walk to the city border.  He                                                               
expressed   that  for   that  reason   alone  the   amendment  is                                                               
unacceptable, on top of the other previously stated reasons.                                                                    
4:49:25 PM                                                                                                                    
REPRESENTATIVE KNOPP remarked that he did  not view it as an opt-                                                               
out, but  rather an opt-in  because it read, "a  municipality may                                                               
by  ordinance  regulate  or  prohibit."   Therefore,  it  is  not                                                               
inclusive  until  adopting  an  ordinance, it  does  provide  the                                                               
option to address issues when they  come up, that is all it does,                                                               
he said.                                                                                                                        
4:50:06 PM                                                                                                                    
REPRESENTATIVE   JOSEPHSON   expressed   frustration   with   the                                                               
legislation because  this could be  a great victory  for everyone                                                               
and opined that  most cities would not prohibit it  and would opt                                                               
for paragraph (a)(2)  in the amendment, and  would want something                                                               
more  restrictive.   Although,  he noted,  cities  could opt  for                                                               
paragraph  (a)(1)   and  be  able   to  prohibit  a   TNC,  local                                                               
governments  want more  local  control as  was  reflected in  the                                                               
Anchorage ordinance.                                                                                                            
[The committee treated the objection as maintained.]                                                                            
4:51:09 PM                                                                                                                    
A roll call  vote was taken.   Representatives Stutes, Josephson,                                                               
and   Knopp   voted   in   favor   of   adopting   Amendment   2.                                                               
Representatives  Sullivan-Leonard, Wool,  Birch,  and Kito  voted                                                               
against it.   Therefore, Amendment  2 failed  to be adopted  by a                                                               
vote of 3-4.                                                                                                                    
4:51:49 PM                                                                                                                    
REPRESENTATIVE JOSEPHSON moved to adopt Amendment 3, Version 30-                                                                
LS0522\R.2, which read as follows:                                                                                              
     Page 10, line 14:                                                                                                          
          Delete "one year"                                                                                                     
          Insert "two years"                                                                                                    
     Page 10, line 17:                                                                                                          
          Delete "one year"                                                                                                     
          Insert "two years"                                                                                                    
REPRESENTATIVE WOOL objected for the purposes of discussion.                                                                    
4:52:07 PM                                                                                                                    
REPRESENTATIVE JOSEPHSON  remarked that  under the  bill, records                                                               
are  to be  retained for  one  year, yet  there is  a statute  of                                                               
limitations in  tort law,  or personal injury,  of two  years and                                                               
the bill  should match that statute.   For example, let  us say a                                                               
TNC driver assaulted a passenger by  hitting them on the jaw, the                                                               
passenger believed  he would  heal; except one  year and  one day                                                               
passed and  the passenger required  jaw surgery.   That passenger                                                               
would not  have access to  the records that otherwise  would have                                                               
been available,  yet he would be  allowed to sue for  another 364                                                               
days  because the  statute of  limitations  runs for  a full  two                                                               
years.  The records could  be information that would exculpate or                                                               
exonerate the  driver, records are  retained in other  cities for                                                               
three years, and the TNCs would accommodate, he opined.                                                                         
4:54:14 PM                                                                                                                    
REPRESENTATIVE WOOL commented  that Representative Josephson made                                                               
good points and he removed his objection.                                                                                       
MS.  CHANG, in  response  to Representative  Birch, advised  that                                                               
Lyft has no objection to this amendment.                                                                                        
4:55:10 PM                                                                                                                    
CHAIR  KITO noted  that  the objection  had  been removed,  there                                                               
being no objection, Amendment 3 was adopted.                                                                                    
4:55:13 PM                                                                                                                    
REPRESENTATIVE JOSEPHSON moved to  adopt Amendment 4, Version 30-                                                               
LS0522\R.3, which read as follows:                                                                                              
     Page 11, lines 11 - 12:                                                                                                    
          Delete "and related services"                                                                                         
REPRESENTATIVE WOOL objected.                                                                                                   
4:55:44 PM                                                                                                                    
REPRESENTATIVE JOSEPHSON  referred to  CSHB 132, Version  R, page                                                               
11, lines  11-12, and said  some stakeholders are  concerned that                                                               
the language "and  related services" is vague.   As written, TNCs                                                               
could  work in  connection  to potential  passengers and  related                                                               
services and,  he said, stakeholders  do not know the  meaning of                                                               
that language.   For example,  could a person with  a semi-truck,                                                               
without a CDL, be hired at  a reduced rate because this becomes a                                                               
pebble  thrown  in the  preverbal  pond  that moves  further  and                                                               
further into the workplace.                                                                                                     
4:56:58 PM                                                                                                                    
REPRESENTATIVE BIRCH remarked that  there was testimony regarding                                                               
passengers  potentially ordering  up a  driver, for  instance, to                                                               
deliver  a  teen-age  child  from  a junior  high  school  to  an                                                               
appointment.    In this  instance,  the  person  may not  be  the                                                               
passenger but they have ordered up  the TNC to provide a service.                                                               
One  of  the benefits  of  ridesharing  is  the potential  for  a                                                               
scheduled and known  person and vehicle to  transport someone who                                                               
may not be  "yourself" to an appointment.  Therefore,  he said he                                                               
has concerns and is not comfortable with Amendment 4.                                                                           
4:58:14 PM                                                                                                                    
REPRESENTATIVE SULLIVAN-LEONARD reminded  the committee that this                                                               
issue was discussed previously with  Ms. Chang, and she asked Ms.                                                               
Chang  to  reiterate aspects  of  what  "other related  services"                                                               
would be with regard to a TNC.                                                                                                  
MS.  CHANG reiterated  that Lyft  often works  with hospitals  or                                                               
senior  centers and  someone at  the front  desk who  is not  the                                                               
passenger will  order a Lyft  for a patient  or a resident.   For                                                               
instance,  an 85-year-old  grandmother, not  familiar with  smart                                                               
phones, can  receive a ride through  a Lyft ordered by  the front                                                               
desk attendant, or her granddaughter, for instance.                                                                             
4:59:24 PM                                                                                                                    
REPRESENTATIVE WOOL noted other  services in ridesharing, such as                                                               
carpooling and  such.   He referred to  the concern  about trucks                                                               
and hauling freight  being considered part of  the "other related                                                               
services" and  stressed that  that certainly  was not  his intent                                                               
with this  legislation.   In the  event that  were to  happen, he                                                               
described that he  would certainly draft a new bill  to make sure                                                               
that did not happen, but at this point that is a bit preemptive.                                                                
CHAIR KITO  turned to Mr.  Matthews of Uber, referred  to related                                                               
services,  and asked  whether calling  a  ridesharing service  to                                                               
deliver a  birthday cake  from one  location to  another location                                                               
and  not actually  carrying a  passenger, was  possible with  the                                                               
Uber platform.                                                                                                                  
5:00:57 PM                                                                                                                    
MITCHEL  MATTHEWS,   Senior  Global  Operations   Manager,  Uber,                                                               
responded  that  Chair  Kito's scenario  was  possible,  but  not                                                               
intended.  From Uber's perspective,  the "other related services"                                                               
relates  more to  activities relating  to  the transportation  of                                                               
passengers.   For  example, Uber's  view on  related services  is                                                               
that  TNCs  help  facilitate the  payment  stream  or  facilitate                                                               
communication between  riders and drivers through  its anonymized                                                               
CHAIR KITO surmised  that Uber's related services  are related to                                                               
what  the  app  provides  in facilitating  passenger  and  driver                                                               
MR. MATTHEWS answered in the  affirmative, and he reiterated that                                                               
it  would be  helping  to facilitate  payments or  communications                                                               
between rider  and driver at the  time they were connected  for a                                                               
REPRESENTATIVE WOOL maintained his objection.                                                                                   
5:02:39 PM                                                                                                                    
A roll  call vote was  taken.  Representative Josephson  voted in                                                               
favor of adopting Amendment 4.   Representatives Knopp, Sullivan-                                                               
Leonard,  Stutes,  Wool,  Birch,   and  Kito  voted  against  it.                                                               
Therefore, Amendment 4 failed to be adopted by a vote of 1-6.                                                                   
5:03:04 PM                                                                                                                    
CHAIR KITO clarified that Amendment  5, Version 30-LS0522\R.4 had                                                               
been noticed but was not being offered at this time.                                                                            
5:03:28 PM                                                                                                                    
REPRESENTATIVE JOSEPHSON moved to adopt Amendment 6, Version 30-                                                                
LS0522\R.6 which read as follows:                                                                                               
     Page 6, line 17:                                                                                                           
          Delete "$50,000"                                                                                                      
          Insert "$100,000"                                                                                                     
          Delete "$100,000"                                                                                                     
          Insert "$300,000"                                                                                                     
     Page 6, line 18:                                                                                                           
          Delete "$25,000"                                                                                                      
          Insert "$50,000"                                                                                                      
     Page 6, lines 19 - 20:                                                                                                     
          Delete "as required under AS 21.96.020 and                                                                            
     AS 28.20.440"                                                                                                              
          Insert "in the amount of at least $100,000 for                                                                        
     death and bodily injury for each person, $300,000 for                                                                      
     death and bodily injury for each incident, and $25,000                                                                     
     for property damage"                                                                                                       
     Page 6, line 31, through page 7, line 1:                                                                                   
          Delete "as required under AS 21.96.020 and                                                                            
     AS 28.20.440"                                                                                                              
     Insert "in the amount of  at least $1,000,000 for death                                                                    
     and  bodily  injury  for each  person,  $1,000,000  for                                                                    
     death and bodily injury for  each incident, and $25,000                                                                    
     for property damage"                                                                                                       
REPRESENTATIVE WOOL objected.                                                                                                   
5:03:32 PM                                                                                                                    
REPRESENTATIVE JOSEPHSON  explained that the amendment  read that                                                               
a driver will  pick up a passenger who presumably  the driver has                                                               
no  relationship.    "But,  remember,   we're  not  calling  them                                                               
commercial  carriers  so it's  a  whole  new relationship."    He                                                               
opined  that  during  period  one,  the driver  is  not  at  home                                                               
thinking  about  engaging  the   application,  the  driver  could                                                               
actually be  driving and looking  for the next ride.   Therefore,                                                               
the driver could be a  distracted driver, except the insurance in                                                               
that period is  the same as for private individuals  in the State                                                               
of Alaska,  and yet the legal  duty is there.   The vehicle could                                                               
be moving and passenger-less and,  he explained the first part of                                                               
Amendment 6 mirrors the $100,000  for each injury and$300,000 for                                                               
aggregate injuries, of  which is located in the taxi  code of the                                                               
municipality.   He  said that  taxi cab  drivers are  independent                                                               
contractors,  TNC drivers  are  independent  contractors, "so  do                                                               
that for  the insurance as  well."  The  $25,000/$50,000 reflects                                                               
property  damage  which  mirrors   the  taxi  rates  required  in                                                               
Anchorage.   He  referenced  uninsured motorists  and noted  that                                                               
rather than  defaulting to the  statute, which would  only mirror                                                               
this  smaller   $50,000/$100,000  number,  the  latter   part  of                                                               
Amendment 6 language would instead  mirror what Uber itself wants                                                               
to offer, $1 million for periods  two and three, and $100,000 and                                                               
$300,000 for period one.   Essentially, he said, this is designed                                                               
to insure  people in  a more legitimate  manner, noting  that the                                                               
$50,000  and  $100,000 numbers  had  not  increased over  a  long                                                               
period  of time.    There will  be accidents,  he  said, and  the                                                               
Anchorage ordinance  read that if  there are seven  passengers in                                                               
the vehicle  the insurance would  be even higher,  stressing that                                                               
he wants this "new thing" properly insured.                                                                                     
5:07:49 PM                                                                                                                    
REPRESENTATIVE  WOOL   referred  to   Representative  Josephson's                                                               
statement that a  TNC driver might be driving  around looking for                                                               
a  fare  and explained  that  TNC  drivers  do not  drive  around                                                               
looking for  fares.  He  further explained that according  to the                                                               
contract, fares  only arrive  to the  driver through  their phone                                                               
app; he  expounded that a  forthcoming committee  substitute will                                                               
state that the  only way a passenger  can get a ride on  a TNC is                                                               
through a phone app, and not  through a phone call or being waved                                                               
down on the  street.  He pointed out that  during period one, the                                                               
driver  could  be  doing  anything,  such  as  being  parked  and                                                               
drinking a  cup of  coffee.  Basically,  he remarked,  the limits                                                               
set in the proposed statute are as  high as any other area in the                                                               
country, and as high as required  by the state for any individual                                                               
driving in the  State of Alaska.  The $1  million requirement far                                                               
exceeds  what  the  state  requires   of  taxi  drivers,  and  he                                                               
commented  that the  committee has  already  had this  discussion                                                               
many times and he maintained his objection.                                                                                     
5:09:50 PM                                                                                                                    
REPRESENTATIVE KNOPP  surmised the numbers  in the draft  are the                                                               
state  minimum  requirements, and  between  his  work trucks  and                                                               
personal vehicles he  probably has 13, maybe  14 vehicles covered                                                               
in damages.  He related that  he has never had an insurance agent                                                               
recommend  the  minimum the  state  requires  because the  agents                                                               
advise it is  just too low, and the amount  is not anywhere close                                                               
to what  would truly be necessary.   He referred to  Amendment 6,                                                               
page 1, line 14 and line  19, and suggested deleting $25,000, and                                                               
inserting $50,000  for property damage  on both lines.   He asked                                                               
whether that was Representative Josephson's intent.                                                                             
5:10:56 PM                                                                                                                    
REPRESENTATIVE  JOSEPHSON moved  to adopt  Representative Knopp's                                                               
Conceptual Amendment 1  to Amendment 6, page 1, line  14 and line                                                               
19, to delete $25,000 and insert $50,000 on both lines.                                                                         
CHAIR  KITO   noted  there  being  no   objection  to  Conceptual                                                               
Amendment 1 to Amendment 6, Conceptual Amendment 1 was adopted.                                                                 
5:12:07 PM                                                                                                                    
REPRESENTATIVE  WOOL  noted that  he  owns  vehicles through  his                                                               
business and insures them for  more than the minimum requirement,                                                               
and anyone driving  for a TNC can certainly insure  their car for                                                               
more than  the minimum.   In  the event the  vehicle is  new, the                                                               
driver has  to have full  coverage, and  this is just  a fallback                                                               
because in  the event  someone does not  have insurance,  the TNC                                                               
will cover everyone in all phases.                                                                                              
5:13:09 PM                                                                                                                    
CHAIR KITO  clarified that  the discussion  now is  regarding the                                                               
three periods  of operation  as follows: period  one is  when the                                                               
driver is in  the vehicle and the app is  not engaged; period two                                                               
is when the driver  is in the vehicle and the  app is engaged but                                                               
no passengers  are being  transported; and  period three  is when                                                               
the driver  has accepted a fare  and is engaged in  the transport                                                               
of  that  individual.    He  noted  that  the  insurance  changes                                                               
recommended by Amendment 6 appear to  be for period two, when the                                                               
vehicle is not occupied by a passenger but the app is engaged.                                                                  
REPRESENTATIVE   SULLIVAN-LEONARD  advised   that  Chair   Kito's                                                               
clarification was incorrect.                                                                                                    
5:14:48 PM                                                                                                                    
JARED  EBER,  Associate  Counsel,  Uber,  responded  as  follows:                                                               
during period one,  the driver is engaged in the  app but has not                                                               
yet accepted a  ride; period two is when the  driver has accepted                                                               
the ride until  the point they pick up the  passenger; and period                                                               
three  is when  the passenger  is actually  in the  vehicle until                                                               
they exit  the vehicle.   Amendment 6  would raise  the insurance                                                               
limits  for  period one  when  there  are  no passengers  in  the                                                               
vehicle and  the driver  has the  app turned on  but has  not yet                                                               
accepted  a ride.   He  noted that  during that  period, over  40                                                               
states have adopted statewide legislation  for insurance being at                                                               
the same  limits as  in the  bill, $50,000 for  an injury  to one                                                               
individual,  $100,000  for more  than  one  individual, which  is                                                               
third-party liability,  and $25,000  for property damage.   Other                                                               
than  the States  of Alaska  and Vermont,  every other  state has                                                               
significantly  less  limits, at  roughly  $15,000  - $20,000  per                                                               
injury   for  one   person,  $25,000   -  $40,000   for  multiple                                                               
individuals  per accident,  and  $15,000 -  $25,000 for  property                                                               
damage.  He  pointed out that the limits listed  in the bill have                                                               
been   accepted  by   the   National   Conference  of   Insurance                                                               
Legislatures together with the largest  insurance trade groups in                                                               
the country agreeing that those  limits are sufficient for period                                                               
one.  He said that someone drinking  a cup of coffee with the app                                                               
on is one piece, but the  other piece is the moral hazard wherein                                                               
if raising  limits that are  not the minimum limits  in Amendment                                                               
6, then the driver  can turn the app on 100  percent of time they                                                               
are in their  vehicle, even if they have  no intention whatsoever                                                               
of  accepting  a ride.    The  would  put  the liability  on  the                                                               
transportation network  company (TNC)  regardless of  whether the                                                               
driver  actually   has  any  intention   of  accepting   a  ride.                                                               
Therefore, the driver knows they  have higher limits they are not                                                               
paying for which, inherently, makes  them a more dangerous driver                                                               
because they have no risk.                                                                                                      
5:19:05 PM                                                                                                                    
REPRESENTATIVE JOSEPHSON  remarked that another way  to view this                                                               
is that a  driver could transport a passenger to  Eagle River and                                                               
not have  a passenger driving  back to Anchorage and  this driver                                                               
could be  under a great incentive  to make a living,  and in that                                                               
window of  time hurry back up  the Glenn Highway just  as fast as                                                               
they  can travel.    He  described that  "You're  taking on  this                                                               
mantle" of  effectively being a  commercial carrier, and  even if                                                               
the  committee carved  out  and pretended  that  drivers are  not                                                               
really  commercial carriers,  "they are  this other  thing."   He                                                               
commented  that  the drivers  and  passengers  do not  know  each                                                               
other,  but  the  drivers are  making  money  driving  passengers                                                               
around and it  appears reasonable to charge the same  rate as the                                                               
Municipality  of Anchorage.   He  argued that  the limits  in the                                                               
bill are not sufficient.                                                                                                        
5:20:55 PM                                                                                                                    
REPRESENTATIVE  BIRCH   spoke  against  the  amendment,   and  he                                                               
referred   to   prior   discussions  regarding   an   established                                                               
acceptable  base  rate.   There  was  a  comment about  a  driver                                                               
transporting  a  passenger  from  Eagle River  to  Anchorage  and                                                               
driving  back without  a  passenger  and, he  said,  that is  the                                                               
current practice  which is  part of  the problem.   In  the event                                                               
someone drives  to Anchorage  from the  Matanuska-Susitna Valley,                                                               
they are prohibited  from "a back haul."   Certainly, he offered,                                                               
the TNC option preserves that  ridesharing and makes good use and                                                               
utility of the equipment and resources available.                                                                               
REPRESENTATIVE WOOL maintained his objection.                                                                                   
5:22:10 PM                                                                                                                    
A roll call vote was  taken.  Representatives Knopp and Josephson                                                               
voted  in favor  of  the  adoption of  Amendment  6, as  amended.                                                               
Representatives Birch,  Sullivan-Leonard, Stutes, Wool,  and Kito                                                               
voted against  it.  Therefore,  Amendment 6 failed to  be adopted                                                               
by a vote of 2-5.                                                                                                               
[HB 132 was held over.]                                                                                                         

Document Name Date/Time Subjects
HB170 DCCED Presentation 3.23.17.pdf HL&C 3/24/2017 3:15:00 PM
HB 170
HB170 Fiscal Note DHSS-SDSA 3.17.17.pdf HL&C 3/24/2017 3:15:00 PM
HB 170
HB170 Fiscal Note DCCED-DBS 3.13.17.pdf HL&C 3/24/2017 3:15:00 PM
HB 170
HB170 Repealers List 3.21.17.pdf HL&C 3/24/2017 3:15:00 PM
HB 170
HB170 Sectional Analysis 3.21.17.pdf HL&C 3/24/2017 3:15:00 PM
HB 170
HB170 Sponsor Statement 3.21.17.pdf HL&C 3/24/2017 3:15:00 PM
HB 170
HB086 ACPE Response HLAC 3.23.17.pdf HL&C 3/24/2017 3:15:00 PM
HB 86
HB141 DOLWD Response HLAC 3.10.17.pdf HL&C 3/24/2017 3:15:00 PM
HB 141
HB170 DCCED Whitepaper 3.20.17.pdf HL&C 3/24/2017 3:15:00 PM
HB 170
HB170 DCCED Presentation 3.23.17.pdf HL&C 3/24/2017 3:15:00 PM
HB 170