Legislature(2003 - 2004)
03/02/2004 01:35 PM L&C
* first hearing in first committee of referral
= bill was previously heard/scheduled
= 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.