SENATE COMMITTEE ON BUSINESS AND ECONOMIC DEVELOPMENT

 

 

February 10, 2005                                                                                                   Hearing Room B

1:00 P.M.                                                                                                                     Tapes  20 - 21

 

MEMBERS PRESENT:         Sen. Rick Metsger, Chair

                                                Sen. Bruce Starr, Vice-Chair

Sen. Jason Atkinson

Sen. Ryan Deckert

Sen. Laurie Monnes Anderson

 

STAFF PRESENT:                 Theresa Van Winkle, Committee Administrator

James Goulding, Committee Assistant

 

MEASURES/ISSUES HEARD:        

                                                SB 318 – Public Hearing

                                                SB 209 – Public Hearing

                                                SB 213 – Public Hearing

                                                Work Session – Introduction of committee measures

                                                SB 309 – Public Hearing

 

 

These minutes are in compliance with Senate and House Rules.  Only text enclosed in quotation marks reports a speaker’s exact words.  For complete contents, please refer to the tapes.

 

TAPE/#

Speaker

Comments

TAPE 20, A

003

Chair Metsger

Calls the meeting to order at 1:10 p.m.  Opens as a subcommittee.

Opens a public hearing on SB 318. 

SB 318 – PUBLIC HEARING

020

Marcia Keith

Oregon Veterinary Medical Association.  Presents her written testimony in favor of SB 318 (EXHIBIT A).

040

Chair Metsger

Observes that a full committee is now present.

045

Lori Makinen

Director, Veterinary Medical Examining Board.  Submits written testimony in favor of SB 318 (EXHIBIT B) and a related Oregonian article (EXHIBIT C).  Begins presentation on the bill and suggests some amendments.

070

Maureena Schmaing

Begins testimony in favor of the bill.  Outlines the abuses committed by a veterinarian.  Outlines attempts at stopping the individual from practicing veterinary medicine.

095

Chair Metsger

Clarifies the points she is making.  Summarizes that the veterinary board does not have the power to take action in this circumstance.

100

Keith

Notes that they could make a recommendation but not take any real action.

105

Sen. Monnes Anderson

Asks what powers the board has if abuse has been proven.

110

Keith

Replies they can take action if a veterinarian commits abuse.  States it takes a long time to establish guilt.

120

Sen. B. Starr

Asks the definition of “unprofessional or dishonorable conduct” in SB 318.  

125

Keith

Asks for clarification on which part of the bill he is looking at.

130

Sen. B. Starr

Notes a section from SB 318.  Reads from that section of the measure.

135

Keith

Clarifies the statement in the bill.  Reads from ORS 686.150. States this applies in a situation where a licensee is practicing veterinarian medicine.  Discusses the investigation and the feelings of the board that harm could be done if action was not taken.

155

Sen. B. Starr

Observes that the attorney general would decide “unprofessional or dishonorable conduct” in relation to the practice of veterinary medicine.

160

Chair Metsger

Clarifies that the “dishonorable conduct” from the statute is specific to conduct under the practice of medicine.  Relates it does not cover animal neglect, only application of medicine.

170

Keith

Concurs with that assessment.

175

Tessa Sage

Portland, Oregon resident.  Testifies in favor of SB 318.  Submits testimony for Susan Ford Burns (EXHIBIT D) and Kathy Jones (EXHIBIT E).

210

Chair Metsger

Outlines the amendment request submitted by Marcia Keith.  Explains the amendments.  Discusses taking action at another time.  Closes public hearing on SB 318.  Opens public hearing on SB 209.

SB 209 – PUBLIC HEARING

245

Cheryl Pellegrini

Department of Justice, Financial Fraud/Consumer Protection Unit.  Submits written testimony in favor of SB 209 (EXHIBIT F) Outlines the need for protection from price gouging. 

390

Chair Metsger

Wonders who the Department of Justice worked with to produce this proposal.

400

Pellegrini

Replies they did not seek out the assistance from outside the department.  Relates previous legislative efforts and the need to address concerns.

420

Chair Metsger

Offers that he is disappointed that no one else signed up to testify.

TAPE 21, A

005

Sen. B. Starr

Asks how the department would feel if they amended the process of the governor issuing a proclamation, in the case the governor was incapacitated.

010

Pellegrini

Replies she thinks it’s a good idea.  Points out disaster price gouging takes a period of time to occur.

020

Sen. B. Starr

Inquires if unlicensed contractors are already breaking the law, how they would prevent them from breaking this law.

030

Pellegrini

Replies that unlicensed contractors are subject to civil penalties. 

050

Sen. B. Starr

Reiterates his desire to know how the department would prevent gouging by unlicensed contractors.

055

Pellegrini

Replies that this bill is aimed at those who raise prices for no reason other than to take advantage of a specific event.

065

Sen. B. Starr

Offers that the situation would still occur under this law.

070

Pellegrini

Replies the bill will provides immediate access through the judicial process to stop price gouging. 

077

Sen. Deckert

Inquires about a section in the bill dealing with a governor’s proclamation establishing the geographic size of an area affected.  Feels the wording is vague and could be made more specific by establishing a size in square miles.

090

Pellegrini

Feels it is an amendment that could be considered.  Notes Mr. Ebersole has some details to ask.

097

Chair Metsger

Asks Mr. Ebersole to address the committee.

100

Eugene Ebersole

Assistant Attorney General.  Discusses the original drafting of the measure.  Talks about the large areas that could be affected by a catastrophe.  Feels the governor needs flexibility to declare a large area.

120

Ebersole

Offers that a governor is not going to declare an emergency zone for a small area.  Makes further comments on the potential for price fixing in the time of a catastrophic event.

145

Chair Metsger

Asks if there is anyone else who wishes to testify.

150

Julie Brandis

Associated Oregon Industries.  Comments that hotels are not covered in this act.  Wonders how this measure would give extra teeth to the law.  Feels it would create additional litigation.  Describes the competitive nature of retailing and the importance of reputation amongst consumers.  Relates businesses in Florida helping to keep prices low following the disastrous 2004 hurricane season.  Seeks tightening of the law.

180

Chair Metsger

Asks if she has additional suggestions to the ones already brought up.

183

Brandis

States she would like to look at the 20% figure and how it applies to competitive nature of retailers.

185

Chair Metsger

Relates the advantages of these particular measures.  Talks about the restraining effect of public opinion.  Feels the department of justice should have some ability to respond to these types of events.  Comments on the importance of having the legislation in place. 

210

Sen. B. Starr

Wonders if anyone from the housing industry would like to comment.

220

Chair Metsger

Notices Scott Barrie in the back of the room.  Sees that he declines to comment on the issue at this time.  Asks that they have additional input before moving this measure forward.

235

Sen. B. Starr

Offers that petroleum is not mentioned in the bill.

240

Pellegrini

States that  issue has been a hurdle before. Offers that they are trying to start with a narrow version of the law and work from there.

250

Chair Metsger

Advises that they work with the committee administrator to resolve their problems and amend the bill.  Closes public hearing on SB 209.  Opens public hearing on SB 213.

SB 213 – PUBLIC HEARING

260

Eugene Ebersole

Senior Assistant Attorney General, Department of Justice.  Submits written testimony in favor of SB 213 (EXHIBIT G).

290

Ebersole

Discusses insurance problems facing contractors.

330

Ebersole

Relates the problems of consumers assuming a contractor is licensed.

370

Ebersole

Concludes with the efforts and resources expended to deal with unlicensed contractors.

390

Michael Snyder

Administrator for Landscape Contractor’s Board.  Testifies in favor of SB 213.  Feels it gives additional tools that the Department of Justice needs.

410

Scott Barrie

Oregon Home Builders Association.  Offers his concerns on the bill.  Points out that the licensed contractors do want help with unlicensed builders.  Talks about his concern with the scope of the problem.

TAPE 20, B

005

Barrie

Continues to outline his concerns over the scope of the bill.

025

Chair Metsger

Summarizes Mr. Barrie’s concerns.  Notes his concerns on the scope of power.  Wonders about a compromise that could be worked out.

035

Barrie

Agrees a compromise could be worked out.  Reiterates his concerns with the bill as drafted.

040

Shawn Miller

Associated Builders and Contractors.  Notes his concerns are similar to Mr. Barrie’s.  Provides an example of work done in the interim with plumbers.  Desires a way to look privately as some of these issues. 

075

Steven Kafoury

Oregon Remodelers Association.  Discusses the establishment of the Construction Contractors Board.  Relates history of the attorney general’s efforts to correct this problem.  Feels they had overstepped the power they needed, relates compromises that were made.  Talks about working out an arrangement with the attorney general’s office. 

100

Sen. Deckert

Outlines his concerns that the attorney general’s staff does not work weekends.

105

Miller

Replies that falls under collective bargaining agreements over employment.

110

Kafoury

Interjects that a homeowner could bring a lawsuit against an unlicensed contractor.

115

Sen. Deckert

Offers that they need investigators who can work when these problems are occurring.

120

Kafoury

Feels the problem is severe enough to warrant that action.

125

Miller

Discusses an independent pilot project along those lines, but for investigating electrical licenses.

135

Chair Metsger

Summarizes that they are looking at two issues, the powers to go after unlicensed contractors and locating the perpetrators.  Notes the concerns on the bill, and feels a compromise needs to be reached between the parties.

160

Sen. B. Starr

Asks Mr. Ebersole if the Construction Contractor’s Board (CCB) is supporting this.

165

Ebersole

Replies they are neutral on this issue. Clarifies the comments of the previous testimony and that the bill is only giving precise powers.  Feels the bill is focused enough.  Notes the Landscape Contractor’s Board (LCB) and CCB overlap, and the problems that result.

200

Chair Metsger

Reiterates the need to cooperate on the bill. 

210

Ebersole

Clarifies that they do not get all their cases from CCB, talks about their consumer hotline. 

215

Barrie

Notes that workers licensed through the building codes division are also insured through CCB for their licensing and bonding.

220

Chair Metsger

Closes work session on SB 213.  Opens a work session for introduction of committee measures.

INTRODUCTION OF COMMITTEE MEASURES – WORK SESSION

225

Theresa Van Winkle

Committee administrator.  Explains LC 2644(EXHIBIT H) and LC 254(EXHIBIT I). 

235

Chair Metsger

Reminds committee members that introducing the measures into the process does not indicate support or opposition.

240

Sen. B. Starr

MOTION:  Moves LC's:  2644, 254 BE INTRODUCED as committee bills.

 

 

VOTE:  4-0-1

EXCUSED:  1 - Atkinson

245

Chair Metsger

Hearing no objection, declares the motion CARRIED.

250

Chair Metsger

Closes work session, opens a public hearing on SB 309.

SB 309 – PUBLIC HEARING

255

Tom Linstrom

Beaver Creek Co-op Telco.  Offers a potential amendment to SB 309 (EXHIBIT J).  Testifies in favor of the bill and explains it. 

280

Linstrom

Addresses concerns that SB 309 will do more than they intended it to do.  Offers description of the functioning of a co-op.

320

Linstrom

Points out that they do serve an area covered by Qwest, but since they function as a true co-op they are not in direct competition with them.

360

Chair Metsger

Wonders what it is about the current process that is unfair to Beaver Creek that would require this legislation.

370

Linstrom

Replies that there is a roadblock to competition.  Talks about the tax status of a co-op and the distribution of excess rates back to members. 

400

Sen. Monnes Anderson

Asks what the basic phone rate for their members is.

405

Linstrom

Replies that local only telephone service is one dollar.  Offers they have a network access charge, further explains the coverage and prices.

425

Sen. Monnes Anderson

Wonders what the average household pays for telephone service.

TAPE 21, B

005

Linstrom

Estimates that average co-op households would pay about $20 a month.

010

Brant Wolf

Oregon Telecommunications Association (OTA).  Declares their opposition to the bill.

015

Mitchell Moore

President, Clear Creek Telephone and Television.  Presents written testimony in opposition to the bill (EXHIBIT K).

060

Keith Galitz

President and General Manager, Canby Telephone Association.  Testifies in opposition to the bill.  Observes that no other phone company or co-op supports this bill.

085

Sen. Monnes Anderson

Asks what the “85/15” test signifies.

087

Galitz

Defines that it means you cannot earn more than 15%, and no less than 85%, of total revenues from activities outside of the telecommunications business.  Explains that if the limit is exceeded the co-op will have to pay taxes.

100

Chair Metsger

Wonders why this bill is streamlined for Beaver Creek.

105

Linstrom

Feels that the bill applies to all co-ops in Oregon and not just Beaver Creek.  Clarifies the way in which this bill could assist all co-ops.

135

Chair Metsger

Asks Mr. Galitz to respond to Linstrom’s remarks.

140

Galitz

Feels the bill makes confusion and conflict.  States he currently has to factor the rules into his business practices.  Offers he can achieve his goals without this bill.

160

Sen. Deckert

Muses that co-ops already have a huge advantage because of their tax status.

175

Linstrom

Outlines some of the competition co-ops face.  Talks amount the services they can provide to rural companies.  Discusses the special protections that have kept their co-op running.

190

Sen. Deckert

Asks if they are protected through their tax status as a co-op.

195

Linstrom

Replies that is not the only protection.  Makes further comments on the services they can provide.

210

Chair Metsger

Asks Lee Beyer to come forward.

215

Lee Beyer

Chair, Oregon Public Utility Commission (OPUC).  Presents a map of telephone service territories (EXHIBIT L).  Testifies in opposition to the bill. 

245

Beyer

Outlines the levels of competition within the business.  Discusses his confusion over the intent of the bill. 

275

Beyer

Feels that in effect the bill would give co-ops too much of an advantage. Outlines the problems involved with that.

305

Beyer

Observes that under this legislation a co-op could choose any service territory they wanted without being challenged.

325

Chair Metsger

Closes public hearing on SB 309.  Adjourns the committee at 2:57 p.m.

 

 

EXHIBIT SUMMARY

 

  1. SB 318, Written testimony, Marcia Keith, 1 p                    
  2. SB 318, Written testimony, Lori Makinen, 2 pp
  3. SB 318, Oregonian Article, Lori Makinen, 2 pp
  4. SB 318, Written testimony of Susan Ford Burns, Tessa Sage, 2 pp
  5. SB 318, Written testimony of Kathy Jones, Tessa Sage, 1 p
  6. SB 209, Written testimony, Cheryl Pellegrini, 14 pp
  7. SB 213, Written testimony, Eugene Ebersole, 3 pp
  8. Introductions, LC 2644, staff, 6 pp
  9. Introductions, LC 254, staff, 1 p
  10. SB 309, Proposed Amendment, Tom Linstrom, 1 p
  11. SB 309, Written testimony, Mitchell Moore, 3 pp
  12. SB 309, Map of Oregon Telephone Exchange Areas, Lee Beyer, 1 p