Legislature(2003 - 2004)

03/02/2004 01:35 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
           SB 324-FLORAL BUSINESS TELEPHONE LISTINGS                                                                        
                                                                                                                                
CHAIR CON BUNDE announced SB 324 to be up for consideration.                                                                    
                                                                                                                                
SENATOR GRETCHEN GUESS, sponsor,  explained that SB 324 basically                                                               
requires disclosure  in advertising  for the  out-of-state floral                                                               
industry.  So, if  a floral  business in  Seattle advertises  its                                                               
services  in  Alaska, it  can't  use  a  local phone  number  nor                                                               
indicate it is a local  provider. Nineteen other states have this                                                               
legislation. Although  the floral  business is a  small industry,                                                               
this is an important issue  for it. Unsuspecting people will call                                                               
a number  thinking it's a  local florist and will  be transferred                                                               
to an out-of-state  florist, who, in turn, will come  back to the                                                               
local florist with the order and  take a chunk of the charge with                                                               
them.                                                                                                                           
                                                                                                                                
     I am not trying  to prohibit out-of-state florists from                                                                    
     advertising in  Alaska, but I  want to give  Alaskans a                                                                    
     choice so that  they know am I ordering  flowers from a                                                                    
     local florist or am I  ordering flowers from an outside                                                                    
     florist.                                                                                                                   
                                                                                                                                
CHAIR BUNDE asked if the fact  that flowers are such a perishable                                                               
product entered into the discussion.                                                                                            
                                                                                                                                
SENATOR GUESS replied  yes. The out-of-state florist  is going to                                                               
have to buy  the flowers from the local florist,  anyway. So, the                                                               
customer  will  be  charged  even  a little  bit  more  for  that                                                               
transaction.                                                                                                                    
                                                                                                                                
CHAIR  BUNDE said  he thought  that  out-of-state florists  would                                                               
also ask the local florist for a wholesale price.                                                                               
                                                                                                                                
SENATOR GUESS replied  that is a good point.  She reiterated that                                                               
she   didn't  want   to  prohibit   out-of-state  florists   from                                                               
advertising in  Alaska, but wanted  their customers to  have full                                                               
information.                                                                                                                    
                                                                                                                                
SENATOR  RALPH SEEKINS  said his  reading of  the bill  indicates                                                               
that a Fairbanks company could  not use an Anchorage phone number                                                               
or a number from anywhere else in the state.                                                                                    
                                                                                                                                
SENATOR GUESS  replied he  is correct and  that the  calling area                                                               
could be interpreted two ways - by area code and location.                                                                      
                                                                                                                                
MS.   DOROTHY   ZAPPA,    Coordinator,   Alaska   State   Florist                                                               
Association,  began  by relating  her  extensive  resume' in  the                                                               
floral area to the committee.  She explained that the association                                                               
has   20,000   members   internationally   including   retailers,                                                               
wholesalers  and growers.  She directed  her comments  toward the                                                               
need  to have  a  deceptive  trade practices  act,  an idea  from                                                               
Charles  F.  Kremp,  a  florist   in  Philadelphia,  who  made  a                                                               
statement  before  the  Committee  on  Economic  Matters  in  the                                                               
Maryland House of Representatives in 1997. He said:                                                                             
                                                                                                                                
     This bill  would make  it an  unfair trade  practice to                                                                    
     knowingly   misrepresent  the   geographic  origin   or                                                                    
     location of a business.  It also requires that whenever                                                                    
     someone uses  the name  of a  locality in  its business                                                                    
     name,  the  actual  address of  the  business  must  be                                                                    
     disclosed in  any telephone directory or  any telephone                                                                    
     directory assistance service.                                                                                              
                                                                                                                                
She  asserted   that  professional  retail  florists   are  being                                                               
bombarded  by  new  competitive  forces  every  day,  like  super                                                               
markets,  chain  stores  and  direct  mail  companies,  featuring                                                               
flowers  and plants  to be  ordered from  a full  color catalogue                                                               
within 24 hours.                                                                                                                
                                                                                                                                
     The competitive  challenges facing retail  florists are                                                                    
     almost too  numerous to mention.  As difficult  as this                                                                    
     competition  is to  deal  with, I  feel  that the  more                                                                    
     exposure to  flowers to express our  innermost feelings                                                                    
     for   the  public's   awareness  and   availability  is                                                                    
     ultimately  very encouraging.  It  is  welcomed by  our                                                                    
     progressive,  visionarially-thinking  florists  because                                                                    
     it does two things. First,  it compels us to try harder                                                                    
     and there is nothing  more fulfilling than figuring out                                                                    
     ways to  convince people  to buy  flowers exponentially                                                                    
     from  small  traditional  shops instead  of  from  some                                                                    
     other  sources.  Second,  all of  these  sales  outlets                                                                    
     expose more  people to  growers more  often. Therefore,                                                                    
     the  pleasure of  flowers in  our  everyday lives  adds                                                                    
     extra beauty  in our environment,  plus it is  known to                                                                    
     be  horticulturally  therapeutic   in  reducing  stress                                                                    
     levels. The  more that happens,  the better  chance all                                                                    
     of us  in the  industry have  of increasing  our sales,                                                                    
     improving  profitability  and making  contributions  to                                                                    
     our local  community. What does irritate,  not only Mr.                                                                    
     Kremp,  but  all our  fellow  florists  and myself,  is                                                                    
     competition that is based on deceiving the public....                                                                      
                                                                                                                                
MS. ZAPPA  said the most  irritating thing about  deceptive trade                                                               
practice is  the impact  it has on  the consumer.  Companies that                                                               
run nationwide  800 numbers make  it quite clear to  the consumer                                                               
that they are  national market makers. Once  consumers know that,                                                               
they  can decide  for themselves  about  where they  want to  buy                                                               
their  flowers. When  consumers don't  have a  reasonable way  to                                                               
differentiate  between an  existing local  business and  one that                                                               
claims to be local, that is unethical and deceptive.                                                                            
                                                                                                                                
MS. ZAPPA  said she  had sent Senator  Guess copies  of deceptive                                                               
advertisements  that  are  in the  GCI  Anchorage  Mat-Su  Valley                                                               
telephone  directory  and  Phone Directories  Company,  Inc.  She                                                               
closed saying:                                                                                                                  
                                                                                                                                
     As you deliberate over this  issue, I ask only that you                                                                    
     put  yourselves  in  the  shoes  of  the  local  retail                                                                    
     florist.  The  vitality  of any  community  across  the                                                                    
     country,  whether it  is  a small  town  or large  one,                                                                    
     depends on  our viability  and that of  schools, houses                                                                    
     of  worship,  governing  bodies  and,  of  course,  the                                                                    
     businesses that operate  within those boundaries. Those                                                                    
     businesses provide  goods and  services to  the public,                                                                    
     but  they  also  offer  employment  opportunities,  pay                                                                    
     taxes  to  support the  local  community  and create  a                                                                    
     spirit  that  helps  hold  communities  together.  That                                                                    
     spirit  is  being  threatened by  the  deceptive  trade                                                                    
     practices that a law would hopefully end.                                                                                  
                                                                                                                                
CHAIR BUNDE  asked if  she intended  to prevent  competition from                                                               
outside the state.                                                                                                              
                                                                                                                                
MS.  ZAPPA answered  no,  but she  wants  to eliminate  unethical                                                               
practices.                                                                                                                      
                                                                                                                                
SENATOR SEEKINS pointed out that SB  324 is not placed within the                                                               
deceptive trade practices title (AS 45.50.471.12), which reads:                                                                 
                                                                                                                                
     ...Using   or   employing   deception,   fraud,   false                                                                    
     pretense,    false   promise,    misrepresentation   or                                                                    
     knowingly   concealing,  suppressing   or  omitting   a                                                                    
     material  fact with  intent that  others rely  upon the                                                                    
     concealment suppression or  omission in connection with                                                                    
     the sale or advertisement  of goods or services whether                                                                    
     or not a person has,  in fact, been misled, deceived or                                                                    
     damaged.                                                                                                                   
                                                                                                                                
He asked if that is the issue she is talking about.                                                                             
                                                                                                                                
MS. ZAPPA replied yes.                                                                                                          
                                                                                                                                
SENATOR SEEKINS asked  her if she felt this issue  would apply to                                                               
any  business, not  just floral.  She said  yes and  he asked  if                                                               
anyone  from  her group  had  ever  filed a  consumer  protection                                                               
complaint with the Department of Law.                                                                                           
                                                                                                                                
MS. ZAPPA replied no. The  Society of American Florists has moved                                                               
forward in the direction of SB 324.                                                                                             
                                                                                                                                
SENATOR SEEKINS said  he had dealt with yellow  page sales people                                                               
and it  seems that is where  part of the blame  for the deceptive                                                               
trade practices lies.                                                                                                           
                                                                                                                                
MS. ZAPPA agreed.                                                                                                               
                                                                                                                                
SENATOR SEEKINS asked Senator Guess  why she didn't want to apply                                                               
this  issue  across  the  board  instead of  to  just  one  small                                                               
industry.                                                                                                                       
                                                                                                                                
SENATOR GUESS replied  that is a good question, but  it is mainly                                                               
because  other  industries  didn't  seem to  have  this  problem.                                                               
Sometimes unintended  consequences happen from applying  a policy                                                               
broadly, but she would entertain his suggestions.                                                                               
                                                                                                                                
SENATOR SEEKINS said  he felt that these  situations were already                                                               
unlawful and it  might be time for the  Attorney General's Office                                                               
to intervene.                                                                                                                   
                                                                                                                                
CHAIR BUNDE said SB 324 would be set aside for further work.                                                                    

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