House Insurance & Commerce Committee
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Bills discussed (15)
| Bill | Title | Sponsor | Status |
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HB1779
· 3 mentions in chapter, transcript
Matched: “HB1779”
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Pre-2017 bill | ||
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HB1582
· 2 mentions in chapter, transcript
Matched: “HB1582”
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Pre-2017 bill | ||
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HB1583
· 2 mentions in chapter, transcript
Matched: “HB1583”
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Pre-2017 bill | ||
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HB1793
· 2 mentions in transcript
Matched: “…Thank you. Okay, committee. The next item on our agenda is House Bill 1793 by Representative McCrary.”
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Pre-2017 bill | ||
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HR1031
· 2 mentions in chapter, transcript
Matched: “HR1031”
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Pre-2017 bill | ||
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HB1529
· 1 mention in chapter
Matched: “HB1529”
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Pre-2017 bill | ||
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HB1556
· 1 mention in transcript
Matched: “…day, with no announcements, the first item on our agenda is House Bill 1556. Is there anyone here to present House Bill 1556 by Represe…”
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Pre-2017 bill | ||
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HB1757
· 1 mention in transcript
Matched: “Okay, next item on the agenda is House Bill 1757 by Representative Hutchison Okay, so no one is here to Alri…”
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Pre-2017 bill | ||
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HB1794
· 1 mention in transcript
Matched: “Is there anyone here to present House Bill 1793? Okay. House Bill 1794 by Representative McCrary. Is anyone here to present House…”
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Pre-2017 bill | ||
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HB1933
· 1 mention in chapter
Matched: “HB1933”
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Pre-2017 bill | ||
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HB2056
· 1 mention in chapter
Matched: “HB2056”
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Pre-2017 bill | ||
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SB464
· 1 mention in chapter
Matched: “SB464”
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Pre-2017 bill | ||
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SB535
· 1 mention in chapter
Matched: “SB535”
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Pre-2017 bill | ||
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SB665
· 1 mention in chapter
Matched: “SB665”
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Pre-2017 bill | ||
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SB789
· 1 mention in chapter
Matched: “SB789”
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Pre-2017 bill |
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our agenda today, with no announcements, the first item on our agenda is House Bill 1556. Is there anyone here to present House Bill 1556 by Representative Nichols? Okay, seeing none, we're going to pass over House Bill 1556
Next item on our agenda is House Bill 1582 by Representative Barnett Representative Barnett Okay, seeing none, next item on our agenda is House Bill 1583 by Representative Barnett Okay, seeing none, we're going to skip over that Next item is House Bill 1747 by Representative Vines Okay, next item is House Bill 1748 by Representative Vines
Okay, next item on the agenda is House Bill 1757 by Representative Hutchison Okay, so no one is here to Alright, so next item on the agenda is House Bill 1779 by Representative Vines Representative Holcomb. Representative Holcomb, if you would introduce yourself for the committee, and you are recognized
Representative Mike Holcomb
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1:36
to present your bill. Thank you, Mr. Chair. Committee members, Mike Holcomb, District 10. What I brought to you today is something really simple that we've been doing. It's just electronic display of watercraft. It doesn't change anything for the insurance companies. It doesn't give the officials, law officials, if they check your electronic display, the authority would go to anything else, and that's pretty much it in a nutshell.
A representative, Holcomb, if I may, you had mentioned an amendment to this bill. Do you have that? No, sir, I talked
Speaker 14
2:15
to Mr. Stovall, and he suggested that I go ahead and run the bill and get
Representative Mike Holcomb
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2:20
with him and make a—DF&A has a little problem with—the only amendment I want to run is the effective date of January, January 2014. Apparently they're doing some changes in their computer system, and they didn't want to have to do it twice, and it's a money situation, I suppose. So he suggested I go ahead and run it and get with DF&A later.
So that's where I'm at. And just, committee, so you know, Representative Holcomb was concerned about the date. I told him that he would have to run an amendment first. So if we
don't have an amendment in front of us, are there any questions of the committee? Representative Copenhaver,
Representative Harold Copenhaver
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2:56
you're recognized for a question. Thank you, Mr. Chair. Representative Holcomb, this is a continuation, a similar bill of what Representative Lee ran the other day. This is just to kind of add to that. Is that correct? Yes, that's
Representative Mike Holcomb
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3:07
correct. Actually, she ran it through Transportation Committee, which I was on, and I brought this up.
And this is how this all evolved, actually. Of course, if you have watercraft, you know how difficult it is to keep your paper dry. You've got it in a plastic bag. It gets wet anyway. So I think this would be a win-win, especially as many lakes and rivers we have across the Strait of Arkansas. But that's actually how it evolved, though. Okay. Thank you
Chair
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3:31
very much. Thank you, Mr. Chair. Thank you. Are there any other questions of the
committee? Are there any questions in the audience? Anyone to speak for or against the bill? Okay.
If seeing none, are you close for your bill, Mr. Holcomb? Yes, sir. Thank you. Okay. Representative Copenhaver? I'd like to make a
Chair
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3:51
motion at the proper time. Okay. Do pass. Okay. We have a proper motion. We have a motion of
do pass on House Bill 1779. All those in favor say aye. Aye. Those opposed? Congratulations,
Representative Robert E. Dale
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4:01
Representative Holcomb. You passed your bill. Thank you, Mr. Chair and committee
Chair
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4:07
members. Thank you. Okay, committee. The next item on our agenda is House Bill 1793 by Representative McCrary.
Is there anyone here to present House Bill 1793? Okay. House Bill 1794 by Representative McCrary. Is anyone here to present House Bill 1794? Okay. Next item on our agenda is House Resolution 1031 by Representative Hutchison. Representative Hutchinson, you are here to you are recognized to present House Resolution 1031
if you would find your seat at the
end of the table and identify yourself for the committee and you are
Representative John
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5:08
recognized to proceed Thank you, Mr. Chair. My name is Representative John Hutchison, and I'm from District 52. I represent Poinsett, Craighead, Jackson, and Independence.
Speaker 41
5:21
And today I'm here to present a resolution and take me briefly here to read it, just a short summary. And, okay. According to the Department of Energy, December 21st, 2012, Notice of Intent to Prepare an Environmental Impact Statement, the Plains and Eastern Clean Line Transmission Project plans to cross Arkansas through the following counties.
Excuse me for being out of breath. I ran upstairs a while ago. Out of shape. Out of shape. All right, and these counties are Crawford, Franklin, Johnson, Pope, Conway, Van Buren, Faulkner, Cleburne, White, Jackson, Poinsett, and Mississippi. More specifically, from Crawford County to eastern Pope County, the routes are south of the Ozark National Forest and generally follow the Arkansas River Valley and Interstate Highway 40.
Routes diverge around Alma and Dyer, but pass north of Ozark, Clarksville, and Dover near the Cherokee Wildlife Management Area. In Conway County, north of Moralton, the routes continue in the easterly direction. The routes continue this easterly track north of Greenbrier near Damascus and Quitman. North of Searcy, the routes turn northeast, generally parallel to State Highway 67, north of Bradford, crossing the White River.
The routes continue easterly along the proposed crossing locations through the Cache River and south of Mark Tree, which crosses Harrisburg, where I live, cross Interstate Highway 55 into two proposed crossing locations of the Mississippi River. The proposed Mississippi River crossing locations are a north-south oriented crossing of east of Wilson, Arkansas
at approximately River Mile 768 and east-west oriented crossing southeast of Joyner, Arkansas at approximately River 762. Today I'm here to ask for this resolution and this resolution If you'll look at
Representative John
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7:41
this map right here, this was a map that I had made in 1994 when I was in the duck hunting business. And if everybody can see the
Speaker 45
7:57
Mississippi Flyway, that's what that is.
Speaker 41
8:00
Okay? And this line starts at the panhandle of Oklahoma, right here, and runs across our entire state and comes into Millington. You see that red star? That's in the vicinity that I live in northeast Arkansas. And as you can
Speaker 45
8:24
see, all these lines are the routes that the Ducks migrate from the north,
from Canada, Saskatchewan, and all that. And in the flyway, they have what they call staging areas. and have any of y'all ever seen the famous duck picture of Claypool Reservoir? I step out
Representative John K. Hutchison
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8:48
the front door of my parents' house and I see the southern line
Speaker 41
8:53
of that. It was the first ever produced hunting show ever, ever, in
Speaker 45
9:01
the United States in 1956.
And I would think that all the people in Arkansas are probably against this because it's a 3,500 megawatt power line, none that our state has seen thus far. It's my understanding that Nuclear One even produces around 1,600 megawatts. I mean, that's strictly an estimate.
So 3,500 megawatts, that's something else. Well, and Arkansas, Arkansans are not allowed. This line is supposedly D.C. current. And along the Oklahoma line, it will be either transformed from A.C. to D.C. and we'll go across our entire state and go to Millington, Tennessee, and then another conversion station right there, we'll convert it back to AC power, is my understanding.
Arkansans will benefit none from this power line. We will not have access on or off, meaning we can't buy or sell to these people. There's nobody in here that's bleeds in renewable energy. Noble Energy, no more than me. But, and these people, they promised me two meetings. One being today at 1 o'clock at the DU headquarters in Memphis, Tennessee, with the Mississippi
Flyway present, and the other, the 19th, at Harrisburg, Arkansas, 6 o'clock. and I promised these people that I would not present this to the house but, I mean, because of that 21st deadline I have to come before the committee today to even think about getting it there I will not put it I'm keeping my word I will not, if y'all pass this
I will not put it on that calendar till after the 19th I ask you, please, I beg you to please vote
Speaker 52
11:19
yes for this. Thank you. Thank you, Representative Hutchinson. Is there any questions in
Chair
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11:26
the committee? Representative Farrar, you're recognized for a question. Thank you, Mr. Chair. Representative Hutchinson, does the
Representative Joe Farrer
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11:33
Arkansas Game of Fish have any input on this at all? They do. Can we hear that input?
Speaker 57
11:42
If they were present. Can you tell me what they said?
Representative Joe Farrer
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11:48
Well, they said they're against it.
Representative John K. Hutchison
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11:50
That's, I mean, no. Yeah, you know, I mean, you know, let's just hear from these people who promised me these two meetings. Let's listen to
Speaker 41
12:03
what these meeting people had to say. And there's 20-something, I think there's 20-something representatives that are involved where this
Chair
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12:11
pipeline actually would affect in, like, 10 senators.
Representative Joe Farrer
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12:15
Let me ask you this question. Do you think maybe you should, if you're having this meeting, maybe you should hold it until you have the meeting? Or
Representative John K. Hutchison
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12:27
is this something that we're on a deadline with? Well, the Federal Register says that the comment has to be in by March 21st. Okay. And this last meeting is the 19th. And to have it in
Speaker 45
12:42
the House chamber by the 21st, Do you understand me having to come today?
I do. I do understand. Okay. Thank you, Mr. Chair. Thank you, Representative Farrar. Representative Viviano,
Representative Mark Biviano
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12:55
you're recognized for a question. Thank you, Mr. Chairman. Representative Hutchison, one of the counties impacted in your document here is White County, which is my county. I've not had anybody express any problems with this up to this point. Could you tell me what evidence you have that this would be detrimental to the waterfowl, duck hunting,
Chair
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13:20
agriculture-related business and property values in these
Representative John K. Hutchison
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13:24
affected counties? Well, in my county I can. And the reason maybe some of your people, you haven't had no response from them, is because I'm not saying my opinion has been kept a little quiet, not really in the open, you know what I'm saying? But this would just give our candidates a little bit of time to really hear the scope on this, you know. And as far as land values, sir, conservatively in my area where we raise rice,
and we depend heavily on the duck income that we receive,
Speaker 45
14:05
they come from many states. land values $4,000 plus hard to put a
Representative John K. Hutchison
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14:13
figure on it but it wouldn't surprise me I wouldn't pay $2,000 for it if it ran over my place and as far as
Chair
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14:26
duck income devastating I'm not sure
Speaker 66
14:31
you provided evidence to that yet but I'll take your word Well, maybe these two meetings might provide
Representative Mark Biviano
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14:41
a little evidence. And I would maybe suggest that we wait on this until you have those two meetings. But I will ask one more question to this, okay, Mr. Chairman? I do recognize. You said
Chair
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14:52
that behind this line it has no economic impact to the states. How did you
Representative John K. Hutchison
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14:57
arrive at that? Well, by the impact I'm talking about, we as Arkansans can't purchase power or sell power to them.
For some reason, I don't know why it was our state. What are we just, we're just a passing
Speaker 66
15:12
through of what it was like to me. Is that what
Chair
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15:23
you mean? Okay. Thank you, Mr. Chairman. Thank you, Representative Viviano. Representative Ward, you're recognized for a question. Thank you, Mr. Chair. Representative Hudson, where is the OXXL Public Service Commission on
this particular issue? I see Mr. Bethel. Yeah, let him come up there.
Mr. Bethel, would you like to come to the front and address that? Mr. Bethel, the committee would like for you to come to the front and address that. I accept your invitation. Thank you. If you would, recognize
Chair
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15:54
yourself in the committee, sir. Yes, sir, Mr. Chairman, members of the committee, I'm John Bethel. I'm the director of the Arkansas Public Service Commission. And in response to Representative Ward's question, the commission is neutral on the resolution, has no position on the resolution.
Cleanline did apply for a certificate of public convenience and necessity with the Public Service Commission to be recognized as a public utility in Arkansas. And the Commission conducted a hearing and a proceeding on that and determined that Cleanline did not meet the definition of a public utility in Arkansas statutes and so did not grant their request for a certificate to be recognized as a public utility in Arkansas. And the Commission had several reasons. primary among those was that the clean line currently, its current business plan did not
include providing service in Arkansas to Arkansas customers. And so that was at the time of the hearing, that was the conclusion that the commission reached. And so that's the only position that the commission has taken on that matter. Okay. Thank you, Mr.
Speaker 31
16:59
Bethel. Representative Ward. Yes. Even if we
Representative Ward
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17:01
don't grant this at all, through intimate domain, will this company still be be able to utilize coming through the state of Arkansas
Speaker 83
17:08
to get to other states to provide them with energy, would they be able to use that?
Chair
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17:15
Absent being found to be a public utility, they wouldn't have eminent domain authority under Arkansas statutes. They could still come through the state and acquire the right-of-way through negotiation, and they don't have to have utility status in order to do that, but they absent that and absent some sort of federal authorization or other authorization that would entitle them to eminent domain, they wouldn't have eminent domain rights, but they could still negotiate with landowners to acquire the right-of-way is my understanding.
Thank you. Thank you. Yes, you
Representative John K. Hutchison
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18:01
may. Don't leave me. Okay. But speaking of, you know, that's part of what these meetings are going to talk about. You know, for instance, like cropland where I live, not only cropland would be affected, but our monies that we depend on from duck hunting revenue, that's some things that would be talked about in those meetings.
And the findings to those meetings will be presented, bring them right here to you. I just want this, I would just like this. I will not, I will request not to have it on the House floor, even to
the House. Representative Hutchinson, let's stay on Representative Ward's question. You have mentioned that there would be effects to the duck hunting and land values. Representative Ward, are you finished with your question? One
Representative Ward
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18:51
other follow-up. Okay. Now, in listening to Smith of Bethel there,
So actually this particular resolution will not really stop them, especially if they are able to negotiate with landowners through private entity there. So really this particular resolution would only what will it actually do if they are able to go another way in order to gain right away?
Chair
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19:26
effect the resolution would have on their continued efforts to construct the line
and acquire the necessary right-of-way. Somebody from the company could probably better describe what their process is outside of I have better knowledge of what's going on before the Public Service Commission and as far as what their efforts are outside of that, I know they're working on an environmental impact statement with the United States Department of Energy and that that process did involve some public comment meetings that were held in cities here in Arkansas,
and there's an opportunity for public comment with the Department of Energy through that process, but that's kind of my knowledge on that subject is limited to kind of how that process had worked and then what's gone on before the Public
Service Commission. Representative Hutchin, you're recognized to answer Representative Ward's question. Okay, Representative Ward, all
Representative John K. Hutchison
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20:25
I'm asking is for the people to be more knowledgeable about this. No, sir, this right here will not stop it if they say it's the thing to do.
Chair
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20:41
the knowledge one more time. Thank you, Representative Hutchin. Representative Ward, do you have any other questions? No, I'm finished. Thank you, Mr. Chair. Thank you.
Representative Co-Chairman Dale, you are recognized for a question. Thank you, Mr. Chairman.
Speaker 96
20:57
You mentioned an impact statement, and I'm assuming now that that
Representative John K. Hutchison
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21:03
has not been completed yet. Not by me, no, sir. The only thing I could give you, the value of duck hunting or the value of waterfowl hunting in our
state is probably close to $2.5 billion, probably.
Chair
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21:19
Representative Hutchins, I'm going to say that if we don't have those facts, we probably want to leave
Speaker 96
21:27
that testimony out. Okay. Okay. May I follow up here? One more question to Mr. Bethel, then. Am I understanding that that impact statement will be presented to the Public Service Commission? I'm not aware that it
Chair
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21:42
will be unless the company makes another application for a certificate as a utility in the state.
The environmental impact statement analysis that's ongoing is part of a United States Department of Energy process, and that's where it will be
Speaker 85
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addressed would be before the United States Department of Energy. Thank you.
Chair
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22:05
Thank you. Are you finished, Co-Chairman Dale? Representative Colvin Haber, you are recognized for a question. Thank you, Mr.
Representative Harold Copenhaver
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22:10
Chair. Mr. Hutchison, I just wanted to clarify, we don't have
any impact, obviously, on duck hunting, but I've grown up in your area as well,
and some of the best duck hunts have been under the big power line south of Jonesboro, Arkansas. So, you know, I'm in question on the impact of duck hunting in the area and property values, to be quite honest with you, because after the lines have been set forth, the property values have maintained south of Jonesboro, rice ground and soybean ground all across the Newport area, all the way across the state.
So, you know, I'm in question of that, but I'd like to see more
Representative John K. Hutchison
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22:55
of what the economic impact would do. And I understand totally, you know, for instance, that one of the lines you're talking about between the Point Set and Craighead County line, that's my understanding that's a 500 megawatt. We're talking about a 3,500 megawatt. All I am asking is let's hear these two meetings' comments. and this resolution will be right there on the back burner.
That's all I'm asking. I just want all of us to be more knowledgeable of this. I'm not asking to stop this thing today. I'm asking to have it there for that purpose. Thank you. Seeing no other questions
of the committee, I'm going to go to the audience. Is there anyone here to speak for or against this? I do have someone signed up, Mr. Ron Herod. To speak against, I don't see Mr. Herod, so I'm going to come back to the committee.
Mr. Hutchison, are you closed for your
Chair
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23:56
bill or your resolution? Yes, sir. Thank you. Thank you. Committee, what are the
wishes of the committee? Representative Hutchison, we're going to table this bill or table this
Chair
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24:12
resolution, and I appreciate you being here today. Thank you. I appreciate the opportunity, sir. Yes, sir. Okay. The next item on
the agenda is House Bill 1801 by Representative Hammer.
Representative Hammer. Next item on the agenda is House Bill 1802 by Representative Wright. I don't see Representative Wright. Next item on the agenda is House Bill 1804 by Representative Viviano. Okay, we're going to pass over that. House Bill 1829 by Representative Vines,
we're going to pass. Okay, Senate Bill 464 by Senator Raper.
If you would go to the end of the table, please, sir. We do have somebody from the audience that would like to come to the end of the table. If you would, identify yourself, please, sir. Thank you. my name is dick horn if you
Dick Horn
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25:21
would speak into your mac is your mac on is it my name is dick horn i'm an attorney here in little rock uh the subject matter can i explain mr chairman go ahead and explain we don't have a sponsor
to run it mr horn so if there if we don't have one today i
think we need to pass over it and that you're the sponsor i know we're going to pass over today That's what I was getting at. So if you would, we're going to pass over this today until another meeting. Okay, yes, sir. All right. Thank you, Mr. Chairman. Thank you, Mr. Horn. Okay, next item on the agenda is Senate Bill 535 by Senator Malik. Senator Malik, you are recognized to present your bill, sir. Thank you, Mr. Chairman.
Chair
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26:11
Members, I think I've got one that's non-controversial for you. Senate Bill 535 has to do with investment of public funds. A few terms ago, we passed some legislation that authorized public entities to invest funds in, we call them CEDARS, they're Certificates of Deposit Account Registry. This is really an intermediary where if a public entity has a million dollars that they want to deposit in their local bank and it has to be either collateralized or pledged, they can't get over the FDIC insurance limit,
there is an intermediary out there that basically would allow that local bank working with the public entity to take $250,000, which is covered, and then they could do an exchange with three other banks, maybe anywhere around the country that also participates in this program, and they'd send $250,000 to another bank that also had excess funds from a depositor and that other bank would send $250,000 to them. The bottom line, this intermediary situation would work where the public entity keeps their funds insured
and the local bank still gets the total amount of money, but it's through a swap arrangement through this CEDAR program. Now, the only thing this bill does is because the original legislation talked about certificates of deposit, The only thing this bill does is it expands that to a money market account or any other type of an account where you could still do this exchange, the same as a CEDAR program. It just talks about any investments or deposits instead of just certificates of deposit.
The public entities, Bankers Association, everyone that's in support, do not know of any opposition, but it just basically applies the same type of program that we've been using on certificates of deposit to other depository accounts like money market funds, and I'd be happy to answer any questions. Are there any questions of the committee? Okay.
Is there anyone in the audience to speak for or against the bill? Seeing none, Senator
Malik, are you? I'm closed. Okay. Representative Dale, I'm recognizing you for a motion.
Motion to do pass. It's a proper motion. We have a due pass on Senate Bill 535. All those in favor say aye. Opposed? Senator Malek,
Representative Robert E. Dale
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28:29
you have passed your bill. Thank you, Mr. Chairman, and thank
you, committee. Thank you. Okay, the next item on the agenda is House Bill 1841 by Representative Wright. Okay, the next item on our agenda is House Bill 1529 by Representative Catlett.
Representative Catlett, you are recognized to present
Representative John Catlett
Unverified
29:10
your bill. Thank you, Mr. Chair and members. What this bill does is it allows the insurance commission, division of the insurance commission, They have a criminal investigation division that presently are specialized, certified
law enforcement officers. And what we would like to do is make them full-time law enforcement officers. And we've got some reasons why, and with me I brought the commissioner and also the division
Speaker 52
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chair. I'd like for them to introduce themselves, please. Thank you. Mr. Chairman, I'm Jay Burford, Department of
Speaker 119
29:45
Insurance, and on my left is Greg Sink, who is the head of our fraud unit. The best way I can explain this issue is what happened a couple of years ago in the state
of Louisiana. I had two fraud investigators from the Department of Insurance that went to an agent's office on an investigation of that agent's conduct. And one male investigator and one female investigator, it happened to be fairly young in her 30s, he killed them both. And they were on duty, of course. And by virtue of a glitch, the, what do you call it, trooper,
the fund that's set aside for law enforcement officers killed in the line of duty, yes, did not apply to them. And so the Louisiana legislature retroactively put those fraud investigators in and allowed those families to collect the money, I'm sure, probably a couple hundred thousand dollars. And so that brought it to our mind that our people are certified to carry weapons. They're playing crows. All but one have been through the police academy.
And one issue is that they will stop. If someone's in trouble, they're plainclothes people, they'll stop and try to help someone, maybe in a traffic accident or someone in distress. None of those activities are covered. Their license is special just for insurance fraud. And so what the bill will do, we'll make these employees, give them the full authority of a law enforcement officer.
There will still be fraud investigators for your insurance department. and will bring them under the umbrella of the compensation if they're killed in the line of duty.
Representative John Catlett
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31:53
Mr. Chair, I might add that this unit was organized in 1993, and specialized police powers were given to them in 1998. Now, for those of you that don't know the different levels,
We have part-time one, part-time two, specialized, full-time police officers, and the criteria for training are different from all of them. And, of course, this would bring them in line with the other law enforcement officers as being fully trained and certified through the Arkansas Law Enforcement Academy. Also, I might add that the states around us, most of which do have full law enforcement certification. Texas, Louisiana partners with the state police, Tennessee, Florida, Georgia, Oklahoma, Mississippi, Kentucky, and Alabama.
You know, we've got to have a good track record with making entities in our state, moving them from specialized to full-time law enforcement officers. And I'll give you an example of that, the wildlife officers. At one time, they were just specialized. And they've been a great asset to the law enforcement community. And I feel like this division of the Insurance Commission will also be a
Speaker 126
33:07
great asset to the law enforcement community. Thank you. Okay. Thank you. Are
there any questions to the committee?
All right. Representative Rice, you are recognized
Representative Terry Rice
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33:24
for a question. Thank you, Mr. Chairman. Commissioner Bradford, are you authorized to carry? No, sir. I'm not. Do these investigators have some sort of badge or anything that their identification can clarify that for
Speaker 129
33:41
us? Yes, sir. They're specialized law enforcement. They're authorized to carry a badge.
They have a gun. They're authorized to use a gun. They're authorized to make arrests. what they're authorized to do is investigate insurance fraud and any crime related to that fraud that they discovered during their investigation. So they're authorized just like a law enforcement officer as long as they're acting within the scope of a fraud investigation. The problem becomes when, and we've had, I brought three law enforcement officers with me today since I've been director
where we have situations that they have witnessed that they had to act because people are expecting them to act because they see their guns. I had an officer at a Walmart that witnessed a shoplifting, and he was beating on the security guard. My officer intervened. Now, that obviously is not an insurance fraud investigation, so if something were to happen to him, he wouldn't be covered because he wasn't acting within the scope of duty.
But we've had a couple other instances that I could point out. But in answer to your question, yes, sir, they do carry guns, they're authorized to carry guns, and they are certified by the
Representative Terry Rice
Unverified
35:02
law enforcement standards. Okay. And I'm not negative or against this, but what brought something to mind was in the paper, I think, yesterday. In a larger city in Arkansas, there was an assistant prosecutor, I think, that was out on his own personal time, but he was flashing his badge and some other circumstances that
shouldn't have happened, and I think I saw his resignation. But have you had, as the insurance department, had any complaints or any questions from anything any consumer complaints, I guess, is what I'm
asking on anything to do with this. Not to my knowledge, sir.
Speaker 129
35:45
We have a group of professional law enforcement officers, and they're really looking to just do insurance fraud, but if they witness a crime out there, then they want the authority
to act on that crime, and they're not somebody that's going to, you know, like some kind of constable that I've recently read about in the paper or former constable. They're not of that quality person. MR.
Representative Terry Rice
Unverified
36:13
anybody. MR. I don't either. I'm sorry. MR. And I sure don't question their professionalism, and I will reiterate what you said is they are trained and certified, and I do appreciate that. Thank you. Thank you, Mr. Chairman. MR.
Speaker 101
36:28
We have a question from Representative Williams.
Speaker 17
36:36
Okay. Then we'll go on to Representative Collins.
Representative Charlie Collins
Unverified
36:39
MR. Thank you, Mr. Chair. Is the insurance department having trouble getting the investigations and things of that nature done? I mean, are we solving a problem that the department is not able to do the work
Chair
Unverified
36:53
that is needed? MR. No, it's not. It's really a periphery issue.
Speaker 119
36:59
The one that concerns me the most is the fact that if they do get killed, even in their scope of duty, like my example that I gave previously, they are not covered under that compensation fund. And they are like many of us, if they see someone in trouble, you know, their tendency is to try to help them, and especially since they are authorized, et cetera, with that. So that is the, you know, my greatest concern is those, are people stepping out there when
And they're going to do it as a citizen, but they really don't have the full-blown authority to do it. We've had two or three instances where they have stepped up. So most of these, frankly, are retired investigators from either state or federal or municipal. Most of these people have been, you know, to everybody who's certified has been to the academy now, even though they're not full because they were previously with other law enforcement agencies.
Representative Charlie Collins
Unverified
38:02
Thank you. I just get concerned if we're expanding police power and we don't see a specific
issue that we've got in front of us, and I just
Speaker 138
38:16
want to make sure I understood that. Thank you. Okay. Representative Collins, are you
finished? Okay. Representative Williams. Thank you, Mr. Chairman. I may unfortunately
repeat some questions that Representative Collins just asked. I heard the telly, and I think we share some concern.
Speaker 144
38:34
I have some reservation about it. Point of water. Representative Williams, so you go over
to the back of the line now. He kind of missed his turn. Oh, okay. We didn't have you down. Okay. Okay. Representative Williams, if you will proceed. Representative Murdoch, you
are next. Mr. Chairman, I'll defer to the fine gentleman from Mariana if you'd like me to. I'm sure my question will be better than he is, but I'll defer. Well, here's what
I'm going to do. Since the chairman had your time and took you out of order, I'm going to recognize you for a question.
Thank you, Mr. Chairman. Thank you, Mr. Murdoch. My question really is along the line of Representative Collins. I served as some time in the AG's office, and
we have obviously a number of investigators there, Medicaid fraud unit investigators, et cetera. And I don't believe they have the destination of full-time law enforcement officers. I don't know if anybody
here from the AG's office can help me with that, but I don't believe they do. Do you know,
Speaker 133
39:35
sir? I think you're correct on that. I think that the AG's office has now been designated a law enforcement agency.
Right. I mean, but that doesn't give them full police and arrest powers throughout the state. They wander upon a robbery in action. They can, but they don't have authority outside of a Medicaid fraud investigation to stop a burglary at the 7-Eleven. Is that not correct? That's correct. But what you're asking for right now would give your insurance investigators the authority to actually go and investigate or actually stop a burger at my house. Well, I might appreciate that, but that's not what you've hired them to do necessarily.
Speaker 133
40:13
Is that not correct? That's correct. And what I'm telling this committee is we're not going to go out and actively do
Speaker 129
40:22
any investigations. What we're asking is if they were to witness something, they want to have the comfort level and the ability to act on what they witnessed so that the state would protect them and their families if something were to happen to
Speaker 133
40:37
them and have some type of immunity for them. And I appreciate
that. I'm just concerned at the slippery slope because there are a number of folks who have investigative power, quasi-law enforcement power.
If we give that to every state agency, then we're going to have a lot of policemen and law enforcement officials out here in areas that's not their job. They're not necessarily, you know, working. And I have a complete respect and appreciation for the work that law enforcement officials do, and in particular for you, Mr. Cabot, for your years of service. But I'm just concerned about the slippery slope we're going down, because if we say yes to you, I don't know how we don't say yes to the AG's office. We don't say yes to fair housing. We just say yes to everyone who else has law enforcement. And I'm not sure that that's what we're doing.
We're not creating another state police or another, because this is statewide authority. This is not just, you can be anywhere, unrelated to insurance. So, Mr. Catlett, are you not a little bit concerned with giving such broad
authority to the investigators at the insurance department? Well, thank you for
Representative John Catlett
Unverified
41:42
the question, Representative Williams. And to the answer to that is no. And because when we have given police powers to other entities, for example, the Arkansas Game and Fish,
they have been just a huge asset to the law enforcement community. And I feel these guys have demonstrated their professionalism since 1998. They do investigate fraud, and they are in environments that are hostile. And not only are the certifications needed, I feel like, but also the training that they will incur, you know, by being full-time certified police officers, will be valuable in their duties, sir. And I have great faith in the insurance commission to always uphold professionalism and standards.
Would you also say that's true for every other law enforcement official in state government? For example, the Medicaid fraud investigators, do you think they also
Speaker 153
42:42
should have that same authority? I'd like to
Speaker 129
42:47
defer that to the Mr. Williams, yes sir, I do I would think that they should have that authority and again I want to point out that we're not going to go off and be investigating robberies or anything of that nature we're going to stick to insurance fraud
but we just want to be able to have our officers covered in case they witness something and they have to act on that something which increases public safety. So, you know, I'd point out that the agency's office recently got law enforcement status. The alcohol and tobacco control has full law enforcement status. And I don't think those agencies are going to be out investigating other crimes that are not related to what that entity specifically set up to do.
So I understand your concerns, but I assure you, that no one that works in our division will be out doing those, actually doing investigations of that nature. Okay.
Chair
Unverified
43:48
Thank you, Representative Williams. Representative Murdoch? Okay.
Representative. Okay. Are there any other questions? Representative Ward, you're recognized for
Representative Ward
Unverified
43:59
a question. Thanks, Mr. Chair. On page two, line two,
reflecting back to what Representative Williams just stated about, them going beyond the scope of what the intent of the fraud work is supposed to do, where it says additional criminal violation and all. Would that not take it out of the frame of just what these persons, the law enforcement agencies are supposed to be actually doing? Thank you for the question, Representative Ward.
Representative John Catlett
Unverified
44:37
But, you know, as a prior law enforcement officer, 30
years retired, a lot of crimes that we investigate lead into other crimes. And I feel like that addressed that because you run into so much more. You might think it's one thing, but then it just materializes and you wind up investigating other things. So I'd like to also ask the Division Chief to respond to that, too. Mr. Kelly is exactly right.
Speaker 129
45:04
And I think the key word in that line is, if you look down on line three, it says additional crime violations that may be related to.
And a lot of times we get into an investigation, and we do discover other things, and we run those traps
Representative Ward
Unverified
45:23
down also. Also, Mr. Keller, I think earlier on you said that you had part-time workers, that you were planning on increasing to
Representative John Catlett
Unverified
45:32
full-time employees. No, you misunderstood me, sir. I was just explaining the different certifications in law enforcement. Part-time one is just a certification status. Part-time two is a certification. They're all based on how many hours of law enforcement you work per week.
And they each require different training. And just like for this specialized, going specialized to full-time, they would require all of their officers to be full-time certified police officers, which includes I think it's up to 12 weeks at Camden now. So if they hire somebody off the street, they'll have to go through the probationary period and send them to Camden for 12 weeks, and they'll have to serve under a field training officer. It's just extra
training. Actually, it'll help their professionalism, I feel like, in the long run, looking down the road several years.
Chair
Unverified
46:19
Okay. Thank you. Thanks, Mr. Chair. Are there any other questions of the committee? Okay. Seeing none, I'm going to go to the audience. We do have someone signed up to speak for. Mr. Corey Cox,
you've signed up to speak for the bill. If you would, Mr. Cox, recognize
Chair
Unverified
46:44
yourself for the committee. Hello, members. My name is Corey Cox.
Corey Cox
Unverified
46:50
Today, I am not here representing the land commissioner, even though that's where I work and where you might know me from. I am here as a private citizen and the former division director of the Criminal Investigation Division of the Arkansas Insurance Department. I preceded Mr. Sink in that capacity. During that, I was the director for four years. During that time, I had the opportunity to work with some wonderful folks that investigate and prosecute insurance fraud.
We found that as we worked through these cases, there were many other violations that were attached to insurance fraud. Somebody that's committing insurance fraud isn't just committing insurance fraud most times. There are oftentimes lots of small misdemeanors. Keep in mind these guys are certified law enforcement. Most of them, if not all of them, come from either Little Rock or North Little Rock PD or the sheriff's office or whatever,
where they had careers, and they retired from those careers, most of them, and served honorably. They know what they're doing. These aren't just folks that we give a gun and a badge. And they also have the ability to enforce felonies now. So what you're essentially looking at is giving them more authority so that they can enforce lesser crimes than what they can already enforce.
And not only that, as I think the commissioner was talking about their certification in workers' comp, these guys also enforce workers' comp fraud. They go after guys and gals that commit workers' comp fraud. So I think it's rather poetic that you give them a certification that recognizes exactly the dangers that they face. When I was there, we put a guy in prison for arson for 20 years.
We investigated murder cases. We recovered money for a widow that an insurance agent was investing her money in what's called churning. We recovered, my last year, over $4 million for the citizens. It went directly into their pockets. It didn't come back to us. It was restitution. So the job that these guys do is important, and it does come with certain dangers.
I would ask that all of you think about what these guys face. Just because it's insurance fraud, it's not without risk. There are always risk inherent in law enforcement. And the job that they do is first rate. I can always say good things about the Criminal Investigation Division. You don't have to worry about them going off and being unprofessional or acting like they're, well, the example brought up.
They're good guys and gals, and they work hard and they do a good job. You would serve the state well by granting them this authority because they help a lot of people, and giving them this authority will allow them to help even more. So that's all I've got. Okay. Thank
you, Mr. Cox. Committee, is there any questions? Mr. Cox, Representative Copenhaver, you are recognized for a question.
Representative Harold Copenhaver
Unverified
50:43
Thank you, Mr. Chair. Mr. Cox, how many individuals, and Representative Catlett, you can answer as well with this effect?
Corey Cox
Unverified
50:50
I'm not sure how many they've got on staff now. They've eight. Just eight? Eight. Okay. Yeah, there were seven when I was there. And keep in mind, there are prosecutors, too, because the state recognized that there was – that a lot of law enforcement jurisdictions are going off after some of the more glamorous, high-profile cases, and it takes a lot of work for them to do that. Insurance fraud is – sort of gets shuffled to the back. So the state and the legislature, when they created the division,
recognized that there is a need for full-time dedicated law enforcement officers and prosecutors. So there are attorneys that work hand-in-hand and are assigned to this division that go around the state as special deputy prosecutors and prosecute all over the state. Thank you very much. Thank you, Mr. Chair. Absolutely. Are there any other
Chair
Unverified
51:43
questions of Mr. Cox? Okay, seeing none, I'm going to go
and see no one else signed up to speak for or against. So Representative Catlett, I'm going to recognize you to close for your bill.
Representative John Catlett
Unverified
51:56
Thank you for the opportunity to bring this bill to you, members. I appreciate
a good vote. What are the wishes of the committee? Do
Chair
Unverified
52:13
pass. Okay. Representative Word has a motion of do pass on House Bill 1529. All those in favor say aye.
Aye. All those opposed, the bill fails. Thank you, Representative Catlett. Okay, committee, the chair, I'm going to address something real quickly with the committee.
The chair tabled, went out of order, and tabled House Bill 1757. without a majority of the quorum. So I'm sorry, H.R. 1031, House Resolution 1031 by Representative Hutchinson. So I am going to go back to Representative Hutchinson and let him know I did
that outside of procedure
and allow him to come back with his bill. But at this time, during that, I skipped over Senate Bill 464 by Senator Rapert that I am the sponsor on. So with the indulgence of the committee, I would like
Chair
Unverified
53:29
to be allowed to go and run that if that's okay with the committee. So
Speaker 153
53:38
that is non-debatable. It is debatable.
Is that okay with the committee? Okay.
Speaker 101
53:51
I'm going to recognize Representative Wren to present Senate Bill 464. Thank
you, committee. Today I'm here to present Senate Bill 464, an
act to amend the Arkansas Life and Health Insurance Guarantee Association Act and for other purposes.
I have with me Mr. Dick
Horn, and at this time I'm going to have Mr. Horn recognize himself and
Dick Horn
Unverified
54:25
explain the bill. Thank you, Mr. Chairman and Mr. Vice Chairman. My name is Dick Horn. I'm an attorney with Dover Dixon Horn. I will advise you that I'm a former insurance commissioner because the matter that we're talking about today is an important insurance matter.
What we're talking about today is amending the Arkansas Life and Health Insurance Guarantee Association Act. that act was enacted in 1989 by the legislature and what it does is it serves as a safety net for life and health insurance policyholders when their company becomes insolvent it's placed in liquidation and the company does not have sufficient assets
to pay all of its claims are in many instances when we transfer the insolvent company's business to another company to fund the necessary reserves. We have a national organization called the National Organization of Life and Health Insurance Guarantee Associations, and there also is a national unit called the National Association of Insurance Commissioners. I know I'm beginning to get a little bit complicated about national this and national that,
but it's kind of important that you get the picture and understand it. What we're trying to do is to bring our law up to speed with the NAIC, that's the National Association of Insurance Commissioners, bill. So right now there are 31 states that have enacted laws substantially similar to what the NAIC model is. We're striving for what we call functional consistency.
I don't know whether you all can see it, but here is a map of the United States. The states in black are the 31 states that have this
Speaker 189
56:34
bill. The white ones, of which Arkansas is among them, does
Dick Horn
Unverified
56:43
not yet have it. The Garrity Association is much like, as I said, the policyholders, Life and Elshner's policyholders, like the FDIC is the banks.
If my insurance company becomes insolvent, does not have sufficient assets to pay my claim, Right now, the Guaranteed Association will pay that claim up to $300,000. What I propose to do, and the fifth on the page, well, I've forgotten the page, but it's Section 5 of this bill, is to increase the coverage for health and accident insurance from $300,000 to $500,000. There is an amendment to the bill that amended it so that long-term care insurance
and disability insurance are not included in that increase. There was a reason for that, and that was a misunderstanding, misinterpretation of a national organization that had some problems with it, which we don't object to. And the biggest reason is that LTC and DI, disability insurance, a long-term care insurance, are not included in the NAIC model bill. To this point, does anybody have any questions that I can help them with?
Dick Horn
Unverified
58:17
which goes into the matter that I just discussed, The other parts of this bill are technical, and they're movements, for example, to clarify or to explain.
But the bill that has the importance, the part of the bill that is important, is the Section 5, which increases the amount of coverage in health insurance from $300,000 to $500,000. I will go through these others if you like Section 1 has to do with Identifying the residence of an insured And what we're trying to do Is to unconfuse something that can be confusing
Because sometimes an insurance company Once it's placed in receivership Is in receivership for a number of years People change their residences and therefore it gets kind of complicated. So we will clarify that. I think these other things are all technical. It will take me some time, but if you'll excuse me, I won't go into them. I'll just tell them they're all consistent with the NAIC model
and I wish that if you have any questions, I'll be glad
Speaker 189
59:43
to answer them. And I am no longer going to speak anymore.
Speaker 96
59:52
Did you have something else to add, Representative? We have one question from Representative Viviano.
Representative Mark Biviano
Unverified
1:00:01
Thank you, Mr. Chairman. On page six, line one, it talks about the association being entitled to any amounts payable by the reinsurer.
Is the association receiving
funds, or is it not going back
Speaker 190
1:00:29
is a clarification of rent provisions whereby
Dick Horn
Unverified
1:00:36
when the company becomes insolvent and is put into liquidation,
it still has all of its policyholders, and all of those policyholders still get paid. But there comes a time when we want to re-insure, that is, transfer those insureds to another company, and that's when that kicks in. Did that answer
Representative Mark Biviano
Unverified
1:00:59
your question at all? No, I just want a clarification that the policyholders are not at risk or there's not exorbitant fees associated with this effort. There are no fees.
Speaker 108
1:01:13
They're not involved in it at all. We've got a
Dick Horn
Unverified
1:01:17
company, well, I'll just give you an example. Signature Life Insurance Company was a small, single-state life insurance company here in Arkansas. It went insolving and had about $4 million, which the Guarantee Association made good. Its business was transferred in bulk. All of its policies were transferred to another life insurance company. Nobody paid anything. It was there for their protection.
When something happens, there's no cost to a policyholder at all. A new company that reinsures and accepts that business accepts it as it is in Toto. Thank you. What it is is total protection, and that is a way of ceding and transferring that total protection to that insurer to another responsible and sovereign insurance company. I'm sorry for such a long-winded explanation, but that's the way it is.
Speaker 96
1:02:16
Okay, any other questions from the committee? If not, we'll go to the audience. Is there any that want to speak against this bill? For the bill? Seeing none, what are the wishes of the committee? We have a due pass. I didn't give Representative Wren a chance to close. I don't guess there, but it's kind of going your way now. All those in favor, aye.
Opposed, no. Your bill's passed. Thank you, Mr.
at on here. Okay, committee, I am back. And at this time, we are going to pass over House Bill 1841,
House Bill 1854, House Bill 1908, House Bill 1928, We're going to House Bill 1933 by Representative Ward-Law. We're going
Chair
Unverified
1:03:37
to recognize Representative Ward-Law for House Bill 1933.
Representative Ward-Law, you are recognized to present House Bill 1933. Thank you, Mr. Chairman.
Representative Jeff Wardlaw
Unverified
1:04:02
I'm going to allow Mr. Hall to introduce yourself to the committee, and if you can tell us a
Michael Hall
Unverified
1:04:08
little bit of something about it. My name is Michael Hall. I'm the current president of the Arkansas Self-Storage Association.
Representative Jeff Wardlaw
Unverified
1:04:18
Committee, what this bill does, I'm having trouble with my voice for the last couple days, but what this bill does is it allows many storage owners and operators to sell a contents policy
to their renters for their contents in their mini-storages. The problem has been that these policies have been so small, insurance agents have not wanted to deal with it. So we think this is a good way to address this problem. I'll be willing to take any questions. Are there any questions to the
Chair
Unverified
1:04:49
committee? Representative Payer, you're recognized for a question. How will the insurance
be offered on the contracts? Well, it's a separate offer.
Speaker 209
1:05:01
There's a third-party insurance company. We're really just offering it to the tenant. The actual transaction is handled through the insurance company. We do have a line on the contract that the customer initials that they either have or will obtain insurance or realize that they're bearing all the risks with
no insurance at all. Okay. Follow-up question, Mr. Chair. Representative Wardlaw, if you're a homeowner, do you currently have coverage now for property in the storage unit?
Representative Jeff Wardlaw
Unverified
1:05:35
I think so under certain policies.
Chair
Unverified
1:05:40
Okay. All right. Thank you, Mr. Wardlaw. Representative Williams, you're recognized for a
question. Thank you, Mr. Chairman. Mr. Wardlaw, or I apologize. I don't remember your name. I apologize. But Mr. Hall, I recently carried a bill for you all that limited liability for the contents of the storage, the renter's content up to the value that's declared at the time of the contract.
So are you telling me that does this bill in any way impact that? So if it's at the fault of the mini storage facility owner and I have content in a storage less than the value that you suggest that I should have or the maximum amount, and it's destroyed, this, and I don't have insurance, you're still liable for that if it was negligence on your part. Say
a fire, you intentionally set a fire. You'd still be liable for that after this, right? If I intentionally set the fire, if
Speaker 213
1:06:34
I had nothing to do with the fire, no, it would not be my responsibility under the contract.
Right, and so this doesn't, this does in no way absolve you of liability for your own negligent acts? No, sir. No, sir. Okay. And
Michael Hall
Unverified
1:06:47
in these cases, as he said, they're so small that I think the limit of liability we just passed was
Speaker 209
1:06:53
$5,000, so this would – these policies are considerably small. Yeah, well,
the bill we passed actually did not have a limit on liability. It just says it would be limited up
to the value that stayed on the contract. So on
Speaker 205
1:07:06
the contract, you could pick whatever value you want to pick. Is that correct?
Yes. Okay. All right. Thank you. Thank you, Representative Williams. Representative Bibiano, you're recognized
Representative Mark Biviano
Unverified
1:07:19
for a question. Mr. Chairman, as a point of clarification, they're essentially offering insurance policies. Can they do that? I mean, don't they have to be certified or licensed as an agent? The insurance department helped with this
Speaker 177
1:07:34
bill a lot. Mr. Jay Bradford's out here in the crowd. He can
Representative Jeff Wardlaw
Unverified
1:07:38
come up here if we need him.
But they're doing a limited license. It's on page one of the bill. for the owners and operators of these storage units to offer this single policy. And if you go on down into the bill, it tells you all the limitations, that this is the only policy they will be able to offer from that place. Okay, so they
Representative Mark Biviano
Unverified
1:07:58
do have to have a license. Okay, thank you.
Chair
Unverified
1:08:02
Are there any other questions to the committee? Representative Barnett, you are recognized for a
Representative Jonathan Barnett
Unverified
1:08:11
question. What's the average rental price of a storage facility these days?
Speaker 209
1:08:14
Just an average. It depends on size, anywhere from $40 to $200. It's really dependent upon size and whether
Representative Jonathan Barnett
Unverified
1:08:24
or not it's climate controlled or not. Can you give us some ideas of what maybe
Michael Hall
Unverified
1:08:29
these policies might run on a per month or per year basis? $5 to $14 a month, depending on
Representative Jonathan Barnett
Unverified
1:08:35
the policy and the limit of the coverage. Okay. And do insurance companies collect that directly, or do you
Michael Hall
Unverified
1:08:42
collect that? There's options in both ways.
Speaker 209
1:08:44
We can collect the money, and I believe the bill only requires us to hold it for 60 days before sending it on. Personally, the operators, myself and others that I know, would prefer that the money go directly to the insurance company.
Representative Jonathan Barnett
Unverified
1:09:00
Okay. What if you have, it's been brought out that the homeowner's insurance policy, and I think Section C, It usually provides for up to 10%, I believe, of coverage for a lot of times you get into situations where you have conflict
and you have insurance companies that say, well, you know, after you settle with your homeowners, then, you know, we'll settle with you. Is that the case
Michael Hall
Unverified
1:09:27
here as well? I'm not sure. Different companies had different offers. I do know that the nature of our business
Speaker 209
1:09:32
is people are moving a lot, and they find themselves not under a homeowner's policy or a runner's policy for a dwelling that they have. And so, you know, that's one of the needs for a policy like this. Typically, I don't think people walk into an insurance agent's office to find this type of insurance.
Representative Jonathan Barnett
Unverified
1:09:51
Okay. Okay. How long do you keep the goods stored if they don't pay before you go to, what's that show that stores wars or whatever? That's a
Speaker 217
1:10:08
fantasy show, by the way. Well, the lien law, I believe, 45 days before
Speaker 209
1:10:14
we have to notify certified and go through all that. Yes, sir. Thank you.
Are you finished, Representative Barnett? Thank you. Are there
any other, Representative Perry, you're recognized? Thank you, Mr. Chair. As far as the perils, I know it's a limited license. What kind of perils will be covered? Will you cover theft or what would be your basic
Representative Jeff Wardlaw
Unverified
1:10:37
coverage? Is that in here? Yes, sir. It's in the bill, Representative Perry, and I'll find it and read it to you. I think it's on page two. Lost, theft, and damage, and other laws directly related to the rental of the self-storage space.
Chair
Unverified
1:10:52
Okay. All right. Thank you. Yes, sir. Are there any other questions to the committee? Okay. Seeing none, I'm going to go
to the audience. Is there anyone here to speak for or against this bill? If not, Representative Wardlaw, you're
Representative Jeff Wardlaw
Unverified
1:11:11
recognized and closed for your bill. I'm closed, and I'll make a motion and
do pass, please. What are the wishes of the committee? Oh, okay. We've got a motion to do pass on House Bill 1933.
All those in favor say aye. Aye. Those opposed, congratulations. Representative Wardlaw, you passed your bill. Okay, next item on the agenda is House Bill 1936. Representative Wardlaw, are you here to present House Bill? Okay, we're going to pass over that. We're going to pass over House Bill 1946. Next item is House Bill 1961. by Representative Rice. We're going to pass over that. Next item is House Bill 2009.
Okay, we're going to pass over that. We're going to pass over House Bill 2028, 2045, House Bill 2046, House Bill 2047, and the next item is House Bill 2050. We're going to pass over that. So the next item on our agenda is House Bill 2056. Representative Williams, you are recognized to present your bill. Thank you, members.
This is House Bill 2056. And this bill, under current law, you
have what's called an appraisal management company. I know the chairman knows all about this, but for those who may not, An appraisal management company is often hired by a lender. It's an outsourcing company. A lender hires an appraisal management company to handle the whole appraisal, whether it's to go and get a broker's price opinion or to get an appraisal. Current law says that an appraisal management company can't use a broker's price opinion
unless they own the property, which really doesn't really make sense because appraisal management companies are not in the business of owning property. They're in the business of handling getting a broker's price opinion or to get an appraisal. Now, a broker's price opinion is often used in situations where the lender would rather not spend the resources necessary to get a full-blown appraisal, maybe in a refinance or in a short sale or in a foreclosure situation where they own the property themselves, kind of a market analysis. Usually a lot of real estate agents do broker price opinions.
There are separate federal and state laws, which in certain instances require an appraisal, and sometimes they allow a broker's price opinion. This bill does nothing with regard to changing the law and when an appraisal or when a broker's price opinion is required by law. This bill simply removes the prohibition from appraisal management companies, which would allow them to actually seek a broker's price opinion when their customer might want one if they don't own the real estate. That's all this bill does. It's very simple, and I'd appreciate a good vote and try to answer any questions.
Representative Barnett, you're recognized for a question. I well remember
Representative Jonathan Barnett
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1:14:14
the bill two years ago, I think that was kind of with the Arkansas Real Estate Commission, taking some of these privileges away from the appraisals and giving it to some of the real estate agents on the
brokerage price opinion. Does this bill kind of put some competition back
in the marketplace where maybe now the appraisals can do the same thing? I mean, appraisals, they can be more competitive and compete with that same market.
Well, let me say that the competition is always a good thing, and I appreciate that, Mr. Barnett. This bill does not regulate who can or who cannot necessarily do a broker's price opinion. Most of the time it's real estate agents, but an appraiser can also do a broker's price opinion if they'd like to. So this really doesn't impact that. This just says that it removes the prohibition that will not allow an appraisal management company to order a broker's price opinion if they don't own the real estate. Right now, you can actually get a broker's price opinion on the exact same piece of property if it's asked for by somebody other than an appraisal management company.
Now, if an appraisal management company asks for it, you can't do it. So it removes a kind of nonsensical provision, and hopefully it does as anything I'd like to do in create competition. You're exactly right. Thank you. Long answer. Are there
any other questions to the committee? Okay. The chairman is going to go to the audience. Is there anyone here to speak for or against? Okay. I want to recognize Mr. Lee Gordon. Mr. Gordon, you are recognized to come to the table. Please introduce yourself and tell us who you're with.
Speaker 232
1:15:51
Good morning. Mr. Chairman, I'm Lee Gordon. I'm the Executive Director of the Arkansas Appraiser Licensing and Certification Board. Okay. You are recognized. Thank you. And thank you to the committee for hearing me. I should let you know at the outset I'm the new executive director of the Arkansas Appraiser Licensing and Certification Board. Many of you probably recall Jim Martin, who ran that organization for 20 years. So I'm new. I can't come to you with a great deal of expertise.
I've been here about two and a half months. But I became aware of this bill a couple of days ago, and I have shared that information with the members of my board, the Appraiser Licensing Board. Those members that have responded are not in favor of this bill. They understand the intent, but generally they think that this would be better if it were not passed. Okay. Are there
Chair
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1:16:48
any questions of Mr. Gordon? Okay. Thank you, Mr. Gordon.
Is there anyone else in the audience to speak for or against the bill? Okay. If not, Representative Williams, you are recognized
to close for your bill. Thank you, Mr. Chair. Oh, I'm sorry. No, go ahead. I'm
sorry. Thank you, Mr. Chairman. And I would say in response to Mr. Gordon, it doesn't surprise me that appraisals would not want increased competition. I wish I could have such a prohibition on the practice of law now, I guess, my bank. So with
Chair
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1:17:23
that, I'd ask for a good vote. Okay. Representative Rice, you are recognized.
Motion due passed, Mr. Chairman. That's a
proper motion. Committee, we have a motion of due pass on House Bill 2056. All those in favor say aye. Those opposed, congratulations. Representative Williams,
you've passed your bill. Okay, committee, the next item on our agenda is Senate Bill 665, and I'm going to recognize our vice chairman, Representative Dale, to present Senate Bill 665. And my, Ms. Brown, if you
would, before we, my screen is.
Representative Charlie Collins
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1:18:03
We can make it smaller. Let
Speaker 165
1:18:15
me do 789 after this one. Yeah. Yeah.
Speaker 96
1:18:24
Thank you. Robert Dale. Thank you, Mr. Chairman. I'm Robert Dale, and I'm here to present Senate Bill 665. I have with me Heath Absher, who is the Director of the Securities Division
here for the State of Arkansas. And I'm going to turn it over to him and let him make a presentation of the bill.
Heath Absher
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1:18:49
Thank you, Mr. Chair and members of the committee. My name is Heath Absher. I'm the Arkansas Securities Commissioner. Senate Bill 665 has two sections I'll mention to you specifically. The rest of it is cleanup or clarifying language. The proposed changes in Section 4 will allow citizens that have accounts with investment
advisors to pursue private actions against the representative or firm as a remedy when violations of the Securities Act occur. This mirrors the liability provisions that we currently have in place for broker-dealers. I don't know why, but the same sort of civil liability provisions never got put in place for investment advisors, so it just evens up the playing field. The provisions themselves are found in the newest model Securities Act language, which is the Uniform Securities Act of 2002.
The proposed changes in Section 9 will add the language orders issued by the insurance administrator of a state to a current list of regulatory orders that may be used as the basis of taking action. If Commissioner Bradford issues an order finding fraud or kicking somebody out of the insurance business, I want to be able to use that order as the basis to take action against them if they also have a broker-dealer or an investment advisor license. As I said, those are the two changes that have some materiality to them. The other proposed changes are clean up
for clarifying language, and I'll be certainly happy to take any questions. MR.
Chair
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1:20:17
Are there any questions of the committee? Representative Williams, you are recognized for a question. MR.
Thank you, Mr. Chairman. Mr. Asher, thank you for being here. I think this is covered in the bill. I
had a constituent call me about the definition of agent that had been greatly restricted, and he was told that it would be fixed in this bill. Does this bill fix that? MR. That
Speaker 242
1:20:35
was the or and the and. MR. Yes, sir. MR. Thank you very much.
Chair
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1:20:39
Thank you, Representative Williams. Okay, seeing none, I'm going to go to the audience.
Is there anyone here to speak for or against this bill? Okay, if not,
Chair
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1:20:51
Representative Dale, are you closed? I am closed. Okay, I'm going to recognize Representative Barnett for a motion. That's a proper motion. We have a motion to do pass. All those in favor say aye. Opposed? Congratulations, Co-Chairman Dale, you've passed
your bill. Okay, committee, we've got one more bill on our agenda, Senate Bill 789.
Senator Rapert, I'm going to recognize Representative Collins to present that bill.
Representative Charlie Collins
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1:21:25
Thank you very much, Mr. Chair. Committee members, what this bill does is open Arkansas for business of captive insurance companies. What captive insurance companies are is an insurance company formed primarily to provide insurance for its parent company and potentially its parent company customers. Arkansas first initiated a law enabling captive insurance companies to form in our state back in 2001.
And what we found is that that law has not really opened the door for us. There's only one captive insurance company in the state, and they're really not doing any business. Some other states have had a lot more success than we have. And, Mr. Chairman, I've got a little side-by-side chart, which kind of highlights some of those, if it's okay with you, if I pass it out. Thank you, sir. That would be fine. I'm going to hand it to Representative Farrar. Well, Ms. Brown, if you would pass that out to the committee, please. Thank you. And what you'll see in this chart is one other jurisdiction, for example, the District of Columbia,
They formed their captive insurance capability the same year we did in 2001. But one of the things that's different about the District of Columbia is they've actually capped the maximum tax that can be collected from any one captive insurance company. And so as you can see on this sheet as it makes its way around, they've got 116 captive insurance companies compared to just the one that we have in Arkansas. So what does all this mean for this bill?
What this bill basically does is instill a similar cap on the amount of taxes that can be levied against a captive insurance company in Arkansas. It caps that tax at $100,000. Today we're not collecting anything. Obviously, if we could get 100 companies that were at the cap, that would be $10 million in tax revenue. That's not a prediction. It's a possibility. If you look at a state like Vermont, they've got, you know, almost 1,000 captive insurance companies.
You know, theoretically, you know, that could be as high as $100 million, not a prediction, just a possibility. So what we'd like to do with this bill is enact a cap of $100,000 for captive insurance companies in Arkansas. And with that, we think we'll start to move this market forward and attract some business here in Arkansas. And I'm happy to take any questions, Mr. Chair. MR. Thank you. Are there
Chair
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1:23:55
any questions of the committee? Representative Murdock, you are recognized for a question. MR.
Representative Reginald Murdock
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1:24:01
Just thank you, Chairman. Thank you, Representative Collins. Just trying to make sure I understand exactly where you're going with this. The concept that you have with this is a concept that if you cap it at 100,000, then that will make it more attractive to others to come, and the trickle-down effect of it would be possibly more jobs for our Kansans. And is that the overall concept? Well, actually, the more
Representative Charlie Collins
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1:24:26
direct effect, Representative Murdoch, would be that if the company, let's just say, you know, chose to relocate, you know, from one of these other states to Arkansas,
or probably better yet, as a new company is formed to help, you know, a large entity manage its insurance risk, that we'll actually create a business that pays taxes to the state. So this is more of a direct tax revenue capture opportunity than it is about creating jobs, although trickling, we may get a few of those
Speaker 245
1:24:57
too. But this is about increasing tax revenue for the state. So by bringing
Representative Reginald Murdock
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1:25:02
business in, maybe not creating jobs, bringing new business to the state,
Speaker 165
1:25:08
and you're capping that $100 to make it attractive, that's your piece that you're trying to attract them with? Yes, sir. Is the cap? Yes. Thank you. Thank you, Representative Murdoch. Are
there any other questions of the committee? Okay. Seeing none, I'm going to go to the audience. Is there anyone here to speak for or against this bill? Okay. If not, Representative Collins, you are recognized to close for your bill.
Representative Charlie Collins
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1:25:34
Mr. Chairman, I'm closed, and I'd appreciate a good vote. Okay.
What are the wishes of the committee? Representative
Copenhaver, you're recognized. Okay. We have a proper motion. Do pass. On Senate Bill 789, all
Chair
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1:25:50
those in favor say aye. Opposed? Congratulations, Representative Collins. You have passed your bill. Thank you, Mr. Chair. Thank
you, committee. Thank you. Committee, at this time, I'm going to call Representative Hutchison back to
the table. Representative Hutchison, if you would, come back to the table. So, Representative Hutchison, I explained to the committee that the chair made an improper ruling.
Chair
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1:26:23
I tabled your bill, but there was no motion, so your bill fails for a lack of motion, and so I needed to let you know that, so the resolution fails. That's all I've got to
Speaker 57
1:26:40
say Thank you very much Thank you Representative Williams Just for a point of clarity
For Representative Hutchison Because it failed you still have an opportunity to bring it back It's like at another time You get two bites of the apple
Speaker 45
1:26:54
Can I question? Can I bring it back Friday Your next meeting? Representative Hutchison You have the right to
bring that back So you will be on the agenda. Okay. I appreciate it. Thank
you, sir. Thank you. Committee, seeing no further business, if I can have a motion. Okay. We do have further business. We passed over Representative Barnett.
Representative Barnett, you have several bills, sir. What bill? Okay. You are recognized to present
House Bill 1582, if you would recognize yourself for the committee. Thank you, Mr.
Representative Jonathan Barnett
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1:27:41
Chairman and members of the committee. House Bill 1582, this is a – pull it up here right fast, please. This is an act to amend the Arkansas Natural Gas Pipeline Safety Act of 1971.
And let me just give you some background on it real quick. The Arkansas Natural Gas Pipeline Safety Act was enacted to ensure the safe operations of natural gas pipelines facilities in Arkansas. The Arkansas Public Service Commission's Pipeline Safety Office is responsible for inspecting natural gas pipeline facilities in the state and to ensure safe operation and to prevent natural gas incidents that may cause death, injury, or property damage. Both the state law and federal laws require Arkansas statutes and codes to be at least equally stringent to federal laws.
The Pipeline Safety Office works cooperatively with the U.S. Department of Transportation to inspect facilities in Arkansas. As part of that cooperation, the Pipeline Safety Office is reimbursed through a grant from the U.S. Department of Transportation for approximately 50 percent of its annual expenditures. The grant agreement requires the Commission to maintain its regulations and state statutes in compliance with federal laws and regulations. Failure to do so will result in a loss of a portion of the federal funding which will result in an increased cost to Arkansas taxpayers or ratepayers.
Section 1 clarifies the notice requirements for the Commission in rulemaking proceedings for pipeline safety regulations. This makes the notice provisions the same as for the other Commission rules. Section 2 increases the maximum civil sanction amounts to be equal to the maximum federal civil sanction amounts. The Commission has discretion in assessing civil sanctions up to the maximum based upon the nature of the violation. I want to repeat, the Commission has discretion in assessing civil sanctions. Imposition of sanctions has historically been limited, and the Commission has not imposed sanctions at the maximum highest levels.
I think that's an important statement as well. Section 3 establishes criminal penalties for willful violators of the Pipeline Safety Code and for tampering with pipeline markers. It also establishes civil penalty amounts. This is required to match the federal statutes. This bill is intended to maintain safe operation of natural gas pipeline facilities in Arkansas and to prevent incidents that could result in death, injury, property damage. There is no known opposition to the bill, and the
Chair
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1:30:12
Commission has worked closely with the natural gas utilities in preparing for these revisions.
Be prepared to answer any questions. Are there any questions
of the committee? Representative Viviano, you're recognized for a question. Thank you,
Representative Mark Biviano
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1:30:25
Mr. Chairman. Representative Barnett, so the natural gas industry is in favor of this bill? I think I'm not obligated to say
Representative Jonathan Barnett
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1:30:31
that they're in favor of it. They have been involved in the discussions, and I think there's no opposition. There's no opposition? Okay. Thank you. Thank you. Are there any other questions of the committee?
Chair
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1:30:41
Okay. Seeing none, the chairman will go to the audience. Is there anyone in the audience that I'd like to speak for or against this bill?
You wrote it. Okay. If not, would you like to close for your bill? We are closed. Thank you. What are the wishes of the committee? Representative Viviano has a motion of due pass. All those in favor say aye. Aye. Opposed? Congratulations, Representative Barnett. You have passed your bill. Thank
you. Thank you. Okay. At this time, I'm going to allow Representative Barnett to run House
Representative Jonathan Barnett
Unverified
1:31:19
Bill 1583. Thank you, Mr. Chairman, members of the committee.
This is an act to amend the Arkansas Underground Facilities Damage Prevention Act, and the Underground Facilities Damage Prevention Act establishes the Arkansas One Call Center and is intended to prevent damage to underground utility facilities and ensure public safety. Third-party damage is a major cause of damage to underground utility facilities, and by contacting Arkansas OneCall before digging, the damage can be avoided. The facilities can be marked so an excavator can avoid the utility facilities.
The law requires contacting Arkansas OneCall before digging. As with House Bill 1582, the Arkansas Public Service Commission's Pipeline Safety Office is required to ensure that the state OneCall statutes are consistent with federal guidelines and requirements. This is part of the requirement to maintain the same level of funding from the U.S. Department of Transportation, and failure to do that will result in a loss of funding and increased cost to taxpayers. The purpose of the one-call center is to prevent damage to underground facilities which cause damage and cause money to repair and create potential public safety hazards that can result
in death, injury, and property damage. Section 1 brings civil sanctions for one-call violations equal to the federal standards consistent with requirements of state and federal law. The civil sanction provides provisions that are enforced by the local prosecuting attorneys. They are done by the local prosecuting attorneys, important note, with assistance from the Pipeline Safety Office and the natural gas utility operators. The prosecutor has the discretion in assessing the level of sanction, and ultimately a circuit judge will enter an order. Sanction 2 clarifies various exemptions and eliminates some exemptions.
The federal law requires elimination of most exemptions, with the exception of utility facility operators' excavation by hand. and excavation of the rights-of-way required before Arkansas OneCall and requesting location of the underground facilities before digging. These amendments clarify that any exemption or excavation within the rights-of-way requires notification and facilities location before digging. This will help reduce damage to underground facilities, improve public safety, and save money. Section 4 establishes the criminal penalties for willful violators of the OneCall laws
that result in the damage of natural gas pipelines, and this provision will be implemented by local prosecutors. This provision will help reduce damage to underground facilities. Utility facilities include public safeties and save money. The Commission has worked closely with the Arkansas Wind Call and the utility facility owners. The Commission has also worked with the counties, municipalities, and Arkansas Highland Transportation Department to ensure that there are not problems with the amendments. And again, there is no known opposition to this bill.
Chair
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1:34:00
Thank you, Mr. Chairman. Are there any questions to the
Representative Harold Copenhaver
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1:34:05
committee? John Copenhaver, you're recognized for a question. Thank you, Mr. Chair. Representative Barnett, I notice on here that the fees, $25,000 up to $200,000, have been increased, and then a half million to two million. Is that simply because
Representative Jonathan Barnett
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1:34:20
of the cost of the lines now? It's federal requirements, for heaven, to ensure that we meet and match the federal
requirements. And your question one more time on the back side?
Representative Harold Copenhaver
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1:34:30
On the back side, the fee increase on that, is that due to the cost of the product itself?
Representative Jonathan Barnett
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1:34:39
I'm going to let Kenwood recognize John. Yes.
Speaker 77
1:34:43
Hi, I'm John Bethel, director of the Public Service Commission. Representative, the fees have
Chair
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1:34:48
to match the federal penalties, and the federal penalties have increased to those levels, so we're matching those. It's partly due to the increased cost of the underground facilities and the damage associated with tearing those up. And then it's also to act as a deterrent further to prevent damage from occurring to those facilities.
But the primary reason that they're at this level is just to match the level set in the federal statute. Thank you
Representative Harold Copenhaver
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1:35:16
very much. I appreciate you answering my question. Thank you, Mr. Chair. Are
Chair
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1:35:19
there any other questions to the committee? Okay. I'm going to go to the audience. Is there
anyone that would like to speak for or against this bill? Would you like to close for your bill? I think I'm closed from Bill. Representative Wilkins, you are recognized. Okay, we have a motion to do pass, committee. All those in favor say aye. Those opposed, congratulations.
Representative Barnett, you have passed your bill. Is there any other bills that we passed over that the committee would like to run? Okay, seeing none, we are adjourned.
Agenda
HB1779
HR1031
SB535
HB1529
SB464
HB1933
HB2056
SB665
SB789
HB1582
HB1583
Documents
No documents posted.
Speakers
Speaker 2
Representative Tommy Wren Chair
Unverified
Representative Mike Holcomb
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Speaker 14
Representative Harold Copenhaver
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Chair
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Representative Robert E. Dale
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Representative John
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Speaker 41
Speaker 45
Representative John K. Hutchison
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Speaker 52
Representative Joe Farrer
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Speaker 57
Representative Mark Biviano
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Speaker 66
Speaker 31
Representative Ward
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Speaker 83
Speaker 93
Speaker 89
Speaker 96
Speaker 85
Dick Horn
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Representative John Catlett
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Speaker 119
Speaker 126
Representative Terry Rice
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Speaker 64
Speaker 101
Speaker 17
Representative Charlie Collins
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Speaker 138
Representative Darrin Williams Chair
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Speaker 144
Speaker 133
Speaker 153
Corey Cox
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Speaker 189
Speaker 111
Speaker 190
Speaker 108
Speaker 15
Representative Jeff Wardlaw
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Michael Hall
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Representative Mark Perry Chair
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Speaker 209
Speaker 213
Speaker 205
Speaker 177
Representative Jonathan Barnett
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Speaker 217
Speaker 232
Speaker 165
Heath Absher
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Representative Reginald Murdock
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Speaker 245
Speaker 77