Legislature(2015 - 2016)BUTROVICH 205
03/02/2015 01:00 PM JUDICIARY
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|Confirmation Hearing Lieutenant Governor Successor|
* first hearing in first committee of referral
= bill was previously heard/scheduled
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SB 5-RESTITUTION: PROPERTY AND INCOME LOSS 1:34:35 PM CHAIR MCGUIRE announced the consideration of SB 5. "An Act relating to loss of income and valuing property for orders of restitution." 1:35:15 PM SENATOR PETER MICCICHE, Sponsor of SB 5, explained that the legislation is about rising property theft crime and restoring crime victims to a pre-offense condition. The bill clarifies for the courts that the public policy favors requiring criminals to compensate their victims for their loss, including loss of income. He related a story from his district. During the busiest time of year someone attacked the truck of a small family-owned business to get the copper wire. Although the value of the crime was relatively low, the family was out of business for weeks and lost many jobs. He noted that the bill also addresses the appellate court decision in Welsh vs. State of Alaska that overruled a lower court decision awarding market value of restitution to a victim of property theft, because it represented unjust enrichment of the crime victim. He said he believes that perpetrators have basic rights but he has a tendency to put the rights of the victim above the rights of the perpetrator. 1:38:03 PM CHUCK KOPP, Staff, Senator Peter Micciche, stated that SB 5 essentially does four things: 1) it amends Alaska's restitution statutes and directs the courts to take into account the public policy consideration that favors requiring offenders to compensate victims for damages and injury, including the loss of income; 2) it provides a definition from the criminal statutes for loss of income as the total loss of income a business or person suffers up to the time that a replacement is obtained; 3) it gives direction to the courts in making determinations of loss or damage for restitution to value the property as the market value of the property; and 4) it amends AS 12.55.100 to reconcile the standard of probation with the standard of sentencing in AS 12.55.045. 1:41:42 PM SENATOR WIELECHOWSKI asked if this affects the amount of payments that would have to be made by the Violent Crimes Compensation Board. MR. KOPP replied he didn't believe so because the board's statutory direction to make people whole is entirely different than the restitution statutes. The guidelines are different for establishing awards. SENATOR COGHILL asked if the bill takes into consideration situations like a frozen building that results from vandalism and it's down for a month and a half. MR. KOPP confirmed that the restitution statute AS 12.55.100 does look at the value of goods and services. SENATOR WIELECHOWSKI posed a hypothetical of kids lighting a fire and destroying a fishing boat. He asked if the owner would be compensated for the loss of income and the replacement of the boat. MR. KOPP replied the current law covers actual damage or injury which would cover the loss of the boat. The bill asks the court to take the loss of fishing income into account as well. SENATOR WIELECHOWSKI asked to whom and how much the perpetrator would pay back if much of the loss was covered by the fisherman's insurance. MR. KOPP said he is a fisherman and his policy would cover the loss of the boat, but not the loss of income. 1:45:26 PM CHAIR MCGUIRE offered her belief that income would be covered for a business that carried professional insurance. SENATOR MICCICHE reminded the committee that the goal of the bill is to make the person whole and make the perpetrator responsible for his/her actions. The goal is the same whether or not the insurance pays first and the perpetrator is on a payment plan afterward. 1:46:06 PM QUINLAN STEINER, Director, Public Defender Agency, offered to answer questions. SENATOR WIELECHOWSKI asked what the courts are doing now regarding restitution and how it might change with this law. MR. STEINER explained that when restitution is ordered it typically becomes part of the judgement for the criminal case. If the person doesn't pay or doesn't attempt to pay it could impact their supervision if the crime is a felony. When the restitution order is large repayment becomes difficult to impossible, and if the person doesn't pay after probation lapses it's something that businesses or individuals could pursue civilly. SENATOR WIELECHOWSKI asked how judges look at this when people can't make payments. MR. STEINER said if somebody has no work and no money they're unlikely to be imprisoned for that alone, but it can happen if they're not making payments. Also, it could impact somebody's ability to get a suspended imposition of sentence (SIS) if they're ordered to pay restitution and they're unable to do that. SENATOR WIELECHOWSKI asked his perspective on whether or not this legislation will result in a lot of people being returned to jail. MR. STEINER opined that the bill doesn't materially alter the present structure with the exception of the discussion of the difference between the retail value and the market value of the property. Typically, stolen items are dealt with at the market value, but under the bill the loss of income arguably could be used to make up the difference. The downside, he said, is the potential for more litigation. He added that he believes there is a misconception about the basis for the Welsh case, because it didn't stand for the proposition that stolen property is valued at wholesale. 1:51:47 PM SENATOR WIELECHOWSKI asked if these cases would require additional court resources. MR. STEINER said it depends on the complexity of the case, what is damaged and the litigation associated with the loss of income. SENATOR WIELECHOWSKI asked if loss of income expands to the crew on a fishing boat that was destroyed. MR. STEINER replied that is a possibility. The crew could argue they're victims of the crime if they're unable to participate in an opening and could potentially receive a restitution order. SENATOR COGHILL asked if a court might put off judgment until it made a determination about the income loss or if the court already deals with that sort of timeframe issue. MR. STEINER asked for clarification of the question. SENATOR COGHILL replied he's referring to the cost of replacement within a reasonable time in the new subsection (o) in Section 3 and the total loss of income referenced in paragraph (2) of Section 2. SENATOR MICCICHE reiterated that the bill asks the courts to consider loss of income, realizing that the decision will not be the same in every case. As sponsor, he feels that perpetrators should be responsible for the item as well as the damage inflicted on the victim. The bill allows that to be considered in court. SENATOR COGHILL restated his question. SENATOR MICCICHE responded that the bill isn't designed to create indentured servitude. The idea is that the perpetrator should be responsible for restitution to the extent possible and in a reasonable period of time. CHAIR MCGUIRE observed that the plain language of the bill allows for judicial discretion. 1:58:54 PM MR. KOPP told Senator Coghill that the language regarding cost of replacement in a reasonable period of time was lifted from the determinations of value in criminal law in AS 11.46.980. SENATOR WIELECHOWSKI asked what sort of discretion the court will have when page 1, lines 14-15, page 2, line 16, and page 2, line 28, all talk about what the court shall do. MR. STEINER explained that the courts don't deviate from using market value when assessing theft and damaged items, although there is discussion about how to determine it for items that are not sold on a readily available market. He reiterated that the Welsh case was somewhat confused in the idea that they were assessing the marked up retail value, which didn't necessarily relate to its market value. That was discussed in another case recently when the appellate court reversed a case that valued the property at more than $500 retail value which made it a felony. The appellate court held that market value prevailed and that the value was under $500. SENATOR WIELECHOWSKI asked if the bill potentially will advance property crime cases from misdemeanors to felonies. MR. STEINER said he didn't believe so because the bill deals with restitution which is different than assessing value in terms of property damage. 2:02:46 PM CHRIS NETTLES, representing National Federation Independent Businesses (NFIB) and President, Geo Tek Alaska, Inc., testified in support of SB 5. He related a personal experience when a snow machine was stolen from a job site at the end of the job. If it had occurred at the beginning of the job, his company would have suffered the consequences of being down until the machine could be replaced. He stressed the importance of the courts being able to consider the total loss a victim suffers in a theft. 2:05:06 PM CHAIR MCGUIRE announced she would hold SB 5 in committee for further consideration.