Legislature(1995 - 1996)
04/21/1995 01:15 PM TRA
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HJR 42- WATER CARRIERS SERVING ALASKA Number 014 GORDON EVANS, Lobbyist, Totem Ocean Trailer Express (TOTE) explained TOTE provides services from the port of Anchorage, Alaska to the port of Tacoma, Washington. Between TOTE and Sea-Land, they bring in the majority of the products that are used in Alaska, particularly the Interior of Alaska. TOTE supports HJR 42. Mr. Evans stated it was his belief that HJR 42 was self-explanatory. He felt it would be a serious mistake for Congress to repeal all regulations of the Alaska water trade. He referred to a bill currently under consideration in Congress which would repeal regulations, not only the Alaska water trade, but in Hawaii and Puerto Rico, as well. These are the only three areas that are currently regulated. He explained that the legislative bodies of these areas are being asked to ensure that an amendment is added to the bill in Congress allowing the people in the Interstate Commerce Commission (ICC) who are currently responsible for the regulating, that they and their duties would be transferred to the Department of Transportation (DOT). He explained it was to companies, such as TOTE and Sea-Land's, advantage to be regulated. One reason is the potential problems with anti-trust issues, or if an oligopoly, where there are several carriers serving a particular trade, the carriers could get together and raise rates and there would be no one to oversee them. TOTE feels as long as there is someone regulating the traffic, there is no potential of someone to institute new or higher tariffs and gouge the shippers involved. Mr. Evans said they have discussed this with Alaska's Congressional Delegation. They have indicated they would support this amendment in Congress, if they could show there was sufficient support in the state for it. MR. EVANS indicated the committee members should have in their bill packets, numerous letters of support from various companies, the municipality of Anchorage, the Alaska Railroad Corporation, Anchorage Chamber of Commerce and others. Mr. Evans indicated that Congressman Don Young was in Anchorage recently and met with the representatives of TOTE and the Alaska Truckers Association. Congressman Young indicated he was pleased with the letters and planned to push the amendment in Congress. Mr. Evans said the current problem is in timing and the mark-up in Congress is scheduled for around May 6, 1995; the first initial adjournment date for this year's Alaska Legislative session. He asked if there were any questions. Number 105 CHAIRMAN DAVIS stated for the record that Representative Eileen MacLean arrived at 1:17 p.m. REPRESENTATIVE BEVERLY MASEK said she was in support of getting the federal government out of the state's affairs and supported HJR 42. CHAIRMAN DAVIS said he would take testimony via teleconference from Mr. Frank Dillion in Anchorage. Number 107 FRANK DILLION, Executive Director of Alaska Trucking Association, stated they were large customers of the steamship industry. They handle the deliveries of the majority of freight that travels through the railbelt of Alaska. The Alaska trucking industry supports HJR 42 and requests that it be promptly moved forward to the floor. Mr. Dillion attended a meeting with Congressman Young and a TOTE representative and Congressman Young indicated that he has already drafted a letter to Chairman Shuster who has jurisdiction in Congress on this particular issue. This letter supported the continued oversight at the DOT of the Alaska water trade steamship (indisc.). He explained the oversight provides stability in the market place. This is an extremely important issue for the businesses in Alaska to understand what the shipping costs will be. He emphasized the importance of having stable and dependable services. He added there was no question regarding the dependability of TOTE and Sea-Land services. MR. DILLION continued to explain even in difficult situations, well beyond their control such as labor difficulties, they have maintained ships in operation and freight moving to Alaska. He indicated the stability should be maintained, and there should be a mechanism to prevent a situation where they may be treated unjustly and they have someone who can arbitrate or at least enforce TOTE and Sea-Land to justify the rates they are proposing. He did not feel that "unbridled" competition in this particular type of market would be in the best interest of anyone in Alaska. He expressed concern that not only would prices go too high, but conversely, of prices going too low. He said a good example of what happens to a transportation entity when it does not price itself compensatorily is the Mark Air situation. Simply by having market share and giving the customers and the shipping public a break, does not necessarily make for a good transportation system. He stated they would be afraid to see other steamship lines move into the market for a short term benefit, using a ship that might not be allowed elsewhere and hauling freight at a cut rate deal, establishing that pattern for awhile and then disappearing. He reiterated his eagerness on passing HJR 42. He asked if there were any questions. Number 160 CHAIRMAN DAVIS said a number of these resolutions have been scrutinized closely when reaching the floor, and he wanted to review some of the details in this particular resolution. Chairman Davis referred to line 9, page 1, stating "Whereas the citizens of the State of Alaska have expressed their desire to preserve tariff filing and the other essential elements..." and expressed concern regarding the letters of support that were drafted by groups and companies. He inquired as to the ways to defend the argument that where have the citizens of the state of Alaska expressed their desire. Number 172 MR. DILLION interjected and reminded the committee of the fact that there are thousands of employees who work for those organizations, and they are all citizens. At times, we defer to the judgment that people who we work for or elect make the decisions that, hopefully, are in the best interest of the majority of people. He did not feel this was the type of issue that you are going to see the rank and file person off the street take much interest in. People are interested in the prices they pay and the dependability of service. He felt this serves well the interests of all the citizens of Alaska that have continued oversight on this particular area of transportation. Number 184 MR. EVANS referred to the letters of support which included such entities as the municipality of Anchorage, the Alaska Railroad Corporation, Anchorage Chamber of Commerce, the General Teamsters Local Union, and the Anchorage Independent Longshoreman's Association and stated they were all consumers as well as groups. He indicated it will come out of their pockets in the end of what they pay at the local stores. He referred to Alaska Matanuska Maid Dairy, Alaska Fish and Farm products and others. He agreed with Mr. Dillon's comments. MR. DILLION added due to the fact that TOTE and Sea-Land are intensely competitive, they want someone watching over them so someone does not make an error in judgment that would impose costs to the state or hurt themselves. He indicated the reason that TOTE and Sea-Land want someone to continue to look over their shoulder is to make sure someone is looking over the other guy's shoulder. He felt this might explain some of the motivation for the support behind this particular issue. REPRESENTATIVE JEANNETTE JAMES asked Chairman Davis if he was interested in a motion to move HJR 42 out of committee. CHAIRMAN DAVIS said yes. REPRESENTATIVE JAMES moved to pass HJR 42 out of the House Transportation Committee. CHAIRMAN DAVIS asked if there was objection. Hearing none, HJR 42 was passed out of the House Transportation Committee.