Joint Corporations Minutes

Draft Only

Approval Pending

of SUMMARY

P ROCEEDINGS J OINT CORPORATIONS, ELECTIONS & POLITICAL SUBDIVISIONS COMMITTEE

COMM ITTEE M EETING I NFORMATION June 4-5, 2014 City Hall Sheridan, Wyoming

COMM ITTEE M EM BERS PRESENT Senator Cale Case, Cochairman Representative Rosie Berger, Cochairman Senator John Hines Senator Wayne Johnson Senator Leslie Nutting Senator Charles Scott Representative James Byrd Representative Dan Kirkbride Representative Troy Mader Representative Jerry Paxton Representative Ruth Ann Petroff Representative Dan Zwonitzer

COMM ITTEE M EM BERS NOT PRESENT Representative Gerald Gay Representative Matt Greene

LEGISLATIVE SERVICE OFFICE STAFF Josh Anderson, Staff Attorney Kelley Shepp, Research Analysis

OTHER LEGISLATORS PRESENT Senator Bruce Burns Representative Kathy Coleman Representative John Patton

The Committee Meeting Summary of Proceedings (meeting minutes) is prepared by the Legislative Service Office (LSO) and is the official record of the proceedings of a legislative committee meeting. This document does not represent a transcript of the meeting; it is a digest of the meeting and provides a record of official actions taken by the Committee. All meeting materials and handouts provided to the Committee by the Legislative Service Office, public officials, lobbyists, and the public are on file at the Legislative Service Office and are part of the official record of the meeting. An index of these materials is provided at the end of this document and these materials are on file at the Legislative Service Office. For more information or to review meeting materials, please contact the Legislative Service Office at (307) 777-7881 or by e-mail at [email protected] . The Summary of Proceedings for each legislative committee meeting can be found on the Wyoming Legislature’s website at www.wyoleg.gov. PAGE 2 OF 17

OTHERS PRESENT AT M EETING Please refer to Appendix 1 to review the Subcommittee Sign-in Sheet for a list of other individuals who attended the meeting.

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

WYOMING LEGISLATIVE SERVICE OFFICE • 213 State Capitol • Cheyenne, Wyoming 82002 TELEPHONE (307) 777-7881 • FAX 307-777-5466 • E-MAIL [email protected] • WEB SITE www.wyoleg.gov PAGE 3 OF 17

EXECUTIVE SUMMARY The Committee met for two days in Sheridan. The Committee heard testimony on telecommunications, energy utility rate monitoring, issues related to elections and the Secretary of State, insurance, issues related to social media, the Board of Cosmetology/Barber's Board and issues related to campaign contributions.

The Committee requested that LSO staff draft bills for consideration at a future meeting of the Committee on the following topics: Prepaid 911 fees; referendum revisions; revisions for special elections when there is a vacancy in Congress; museum special districts; voting centers and electronic pollbooks; the Department of Insurance fine schedule; insurance for portable electronic devices; social media – death of account holder; employer access to social media; repeal of the aggregate limit on campaign contributions; and repeal of the limit of campaign contributions from a political action committee (PAC).

The Committee requested additional discussion on the telephone assistance program and elections of downtown development authorities at one of its future meetings. The Committee also recommended the formation of informal committees or task forces on the telecom act, the UCC and the Boards of Barbers and Cosmetology. Finally, the Committee recommended that an opinion be sought from the Attorney General regarding enforcement of the aggregate limits on campaign contributions for the 2014 elections.

CALL TO ORDER (JUNE 4, 2014) Co-Chairman Berger called the meeting to order at 8:30 a.m. The following sections summarize the Committee proceedings by topic. Please refer to Appendix 2 to review the Committee Meeting Agenda.

TELECOMMUNICATIONS Mayor Dave Kinskey of Sheridan, Wyoming welcomed the Committee. He stated that in his personal capacity he was involved in the installation of high capacity fiber cable from Casper to Billings using private funding which was customer demand driven. He stated it was part of a movement to install fiber from Denver to Billings, leveraging the large customer demand in those communities. He stated that they were working with The Wyoming and Montana Departments of Transportation.

Telecommunications Act Mr. Jason Hendricks of Wyoming Telecom stated that he represents rural carriers who provide high quality landline voice and broadband, and some that provide wireless and video. He stated that the companies are providers of last resort for customers that have a high cost of service. He said the service providers access universal service funds in order to provide service to those customers. He noted that the purpose of the universal service fund is to ensure service is available everywhere. When a rural local exchange carrier incurs costs they can submit those costs and then get reimbursed from the universal service fund for a portion of those costs. He stated that recent action by the federal government capped and reduced the fees they can receive from other providers, capped and reduced federal service funds that are available and also required broadband to be provided at certain speeds. The effect of those actions requires the providers to do more with less. He noted that Wyoming has very high local rates relative to other states and if the providers exceed the cap on rates they lose the universal service fund funding.

Ms. Liz Zerga, on behalf of several rural telecom companies, stated that carriers rely on three sources of funds: funds from the universal service fund, revenue from consumers and revenue from carriers. She stated that the FCC reduced the funds available from the universal service fund, reduced the revenue they can collect from other carriers and capped local rates. She explained that the Wyoming Universal Service

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

Fund is a price based fund and companies can receive funds to the extent that the local base service price exceeds 130% of the average local basic rate after consideration of the Federal universal service fund. She said that the problem with the price based fund is that the higher a provider sets its price, the more Wyoming universal service funds the provider can receive. This encourages providers to not reinvest and not become more efficient. She noted that reimbursement under the price based fund is also difficult to predict which leads to customers experiencing changing rates. She also said that the Wyoming universal service fund does not dovetail well with the federal universal service fund.

Ms. Zerga suggested that the Wyoming universal service fund be replaced with a cost based fund that mirrors the Federal fund. She stated that it would be important to make the formula transparent and that it would be more predictable year to year. She noted that it was important to make sure the fund is competitively neutral and that it requires recipients to provide voice at a fixed, reasonable price. In response to a question, she stated that wireless technology could be eligible for these funds if they provide service as carrier of last resort . She noted that the federal fund has constraints and caps on spending so that it is not a run-away fund.

Mr. Hendricks noted that if a line to a particular house costs $1,000, the company could get a percentage of that cost back from both the Wyoming universal service fund and the federal universal service fund, but there may still be unrecovered costs which would place a constraint on spending too much.

Ms. Kristin Lee and Mr. Jeremey Firkin of Century Link provided a presentation to the Committee. See Appendix 3 for a copy of the presentation. Ms. Lee noted that there would be a hearing in September of this year over the petition for CenturyLink to be classified as competitive in certain zone 1 areas. She noted that they were not asking to be deregulated in Zone 2 or Zone 3. She noted that they have approximately 16,000 customers and they are losing 10% of those customers each year. There is competition in every exchange and every zone.

Mr. Firkin stated that Century Link has invested $78 million in the last three years and they are building for the future. He stated that they have a third place market share and are looking to win back customers. He said that the first 100 gigabyte circuit that went online in the U.S. was the one they built in Cheyenne.

Mr. Firkin stated that they are facing massive competition and some customers are making a choice and are willing drive to the top of a nearby hill if necessary to get wireless service, rather than having direct line service to their house. He stated that many customers are choosing to drop wired service in favor of satellite or wireless.

Ms. Jody Levin of Verizon and Charter, Mr. Dave Picard of Satellite Broadcast and ATT, Mr. Chris Robisch of Wyoming.com and Ms. Cheryl Riley of ATT Wyoming addressed the Committee regarding the Telecommunications Act. Ms. Levin noted that they have formed an informal coalition called the competitive carriers coalition which represents much of the unregulated telecom industry. She noted that they have a limited role in the current Telecom Act. She noted that competition is growing and that they could not have predicted in 1995 that we would have smart phones today. She noted that the Telecom Act is an old framework is not keeping pace with technology. She said that customers pay into the universal service fund and if the fund is changed it would be important to consider what effect it would have on customers.

Mr. Robisch stated that his company offers fixed signal wireless. He said that they do not get universal service funds even though they are aimed at rural customers. He suggested that the Committee continue to

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

push policies that allow for innovation and allow for customers to tell the market what technology they want.

Ms. Riley stated that there is significant pressure on wireless providers to keep up with demand.

Mr. Picard stated that satellite is competitive in urban areas, but less in rural areas. He stated that it is important that any changes be technology neutral and not act to subsidize new entrants into the market.

In response to a question, Ms. Levin noted that wireless carriers do not generally qualify for universal service funds because the carriers have chosen not to be eligible telecommunication carriers. She stated that slightly less than half of all households are wireless only with no landline.

Mr. Robisch stated that consideration of accessing universal service funds has been a discussion every quarter, but Wyoming.com has pride in being privately funded and being able to recover costs and make a profit. He noted that they also do not like the idea of having to serve a specific area.

Mr. Al Minier of the Wyoming Public Service Commission stated that there are no easy solutions on this topic. He stated that one of the virtues of the price approach for the universal service fund is that it is self- limiting. He noted that with the Century Link hearing, it would be determined on an exchange by exchange basis and that it was possible that the ultimate result would be that one or more exchanges in zone 1 were deregulated, but not all of them. In response to a question, he stated that it may be worthwhile to extend the sunset date of the Telecom Act and wait to see how everything plays out as the Connect America Phase 2 funds and other actions begin to take effect.

Co-chair Case moved that an open task force be formed with members of the Committee and industry which would meet in parallel with this Committee to work on recommendations for legislation with decision points for the Committee related to the Telecom Act. Co-chair Case asked that Ms. Zerga, Ms. Levin and Ms. Lee work together to organize dates when the task force could meet in person at a central location. Senator Case noted that the Legislative Service Office would not be required to staff the task force and that all members of the Committee would be invited to attend. The motion was seconded and passed by voice vote.

Governor's Broadband Expansion Update Mr. Flint Waters, State Chief Information Officer, provided a handout to the Committee providing an update on the unified network project. He noted prior to the project only two counties had an Ethernet connection and that now 22 of 23 counties are served with Ethernet capabilities. He noted that there is a bid to provide a connection for the 23rd county and it could be in place by the end of this summer. He stated that previously Goshen County shared a 40 megabit connection, but they now have a gigabit connection. He noted that the connections are not to every school, but they are to every school district. He stated that the phase 2 goals are to have a redundant ring in order to remove potential choke points or single points of failure. He said that the state is not building fiber but is instead contracting and acting as an additional consumer in order to reinforce community need for fiber. In response to a question, he noted that once the redundant ring is in plate the system would be able to immediately roll over traffic if there were problems without users noticing the difference. He noted that Wyoming helped build the gigaPOP network which connects Colorado University, Colorado State University and the University of Wyoming and acts as a major junction for global internet traffic. It provides amazing potential for the state. Mr. Waters noted that the goal is to bring every school district up to the same level.

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

Prepaid 911 Ms. Cheryl Riley addressed the Committee on the topic of prepaid 911. She noted that with prepaid wireless phones there is no monthly bill and so the traditional means for assessing 911 is lost. She said that it is important that the 911 assessment be applied equitably. Ms. Riley provided two handouts on prepaid 911 to the Committee (see Appendix 5 for a copy of the handouts). She stated that 33 states have enacted some type of legislation and that the legislation in the handout is based on model legislation from NCSL. She stated that under the proposed legislation the fees collected would be remitted to the Department of Revenue.

John Cmelak of Verizon said that a fee of 1.5% of the price on the prepaid service would equalize the tax burden between the prepaid and the more traditional customers. He noted that some states have stayed with a fee per month but to some extent that method is regressive and could put a higher burden on the lower income customers. The fee of 1.5% percent of the price would provide a more equitable result.

Ms. Amber Ash, Laramie Count Commissioner, noted that municipalities are different throughout Wyoming in the way they collect and spend these fees. She noted that the 911 fee is up to 75 cents per month. She stated that in Laramie County there is a very robust system which was enhanced through utilization of the specific purpose tax. She noted that prepaid customers can access 911 services and should participate in paying for the system.

Mr. Pete Obermueller of the Wyoming County Commissioners Association stated that it is important to broaden the discussion and the proposed legislation stands on its own merits. He noted that an additional consideration is the adequacy of the current fee, but at this point there is a gap in accessibility of data. He noted that under the current statute the reporting requirement is buried in a definition and that it should be moved to a stand-alone section. He noted that the reporting requirement is also not clear as to who is the governing body and also requires calendar year reporting. He said that the Association believes the reporting requirement is important and should be revised to ensure delivery of uniform data.

Mr. Jim Wetzel, Chief of Police Casper, addressed the Committee concerning E911. He noted that Casper has a new public safety communication center and dispatch center and that it is important to have legislation for prepaid 911 as the 911 fees provide a majority of the funding. Mr. Steven Freel, Casper Police Communications Captain, stated that their center has capability as a regional hub. In response to a question, Mr. Freel stated that the system can be more efficient and that regional centers might save a lot of money. However, they may also cause lost employment in some communities.

Mr. Obermueller stated that consideration of the 911 system as a whole has merit, but it is important to consider that E911 and wireless 911 are not the same thing. He noted that all counties have E911, but the counties are not all at the same level when considering their wireless 911 capabilities. He noted that with wireless phase 1 it is not possible to see where the call is originating while with wireless phase 2 it is possible to see where call is originating and other features. He stated having a discussion on how to get all of the counties to phase 2 or beyond is important, but it should not hold back the discussion on prepaid wireless fees.

Mr. Dan Noble of the Department of Revenue stated that there is an administrative component to the fee and that the main concern is the set up costs. He noted that while it may not be a great deal of money, the costs to set this up will not be minimal and that it will require space on the already busy tax return form.

The Committee received a handout from the Wyoming Retail Association on prepaid 911 legislation. See Appendix 6 for a copy of the handout.

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

Co-chair Case moved that staff draft a bill based on the proposed language provided and that the draft also revise the reporting requirements and move them out of the definition section as was discussed. The motion was seconded and passed by voice vote.

Sales Tax Exemption for Broadband Co-chair Case noted that industry made a presentation to the Revenue Committee on the topic of a sales tax exemption for broadband. He noted that part of the discussion focused on whether the companies would reinvest the savings generated by the tax exemption. While some companies indicated they would automatically reinvest the savings, that did not appear to be true for all providers. He stated that the Committee kept the topic alive and will continue to consider it. Senator Case noted that exemptions in general require more analysis than just foregone revenue and that it was important to re-evaluate tax exemptions. He stated that there was some consideration of creating a CREG like group to evaluate tax exemptions to determine their effectiveness using econometric analysis.

Broadband Grants Ms. Kristin Lee addressed the Committee to discuss how the broadband grant program worked. She said that in CenturyLink's case they were contacted by the Natrona County Airport and gave them a quote for a fiber connection. The Airport sought a grant through the business council and CenturyLink was not involved in the grant process. Subsequently a request for proposals was issued for a competitive bid on the project.

Telephone Assistance Program (TAP) Mr. Jason Hendricks noted that the TAP program provides low income customers with credits to reduce their telephone bill. Previously the program required a match from the state to get full federal money. He stated that now no matching amount is required and customers get the full amount of the credit whether the funds are matched or not. He stated that the state statute is no longer in sync with the federal statute and if the state wants to continue their portion, the statute should be rewritten to remove obsolete language.

After additional discussion, Co-Chair case recommended that the Department of Family Services and other interested parties be invited to provide information on whether or not the state program should be repealed or conformed to remove the obsolete language.

ENERGY UTILITY RATE MONITORING Mr. Ken Lay of the Northern Laramie Range Alliance stated that in Rocky Mountain Power's most recent integrated resource plan they indicate that they will not need to acquire new power generation until 2024. He stated that the cost of wind energy is declining and it is better for rate payers to wait because the production tax credits have expired for wind and a large part of the economics has shifted. He stated that there is a complex protocol for allocating costs and that while renewable energy credits were a source of revenue to Rocky Mountain Power, now that those revenues have collapsed there is an increase in costs to ratepayers.

Mr. Brad Shafer of Rocky Mountain Power stated that the wind facilities built in Wyoming were the least cost option at the time. He noted that another consideration at the time was the renewable portfolio standard which was later changed to give priority to generation located in California. He noted that, under the net metering rate scheme, if someone self-generates power on their own property that generation is netted against the power that they use. He said in Utah those customers get a credit while in Wyoming

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

they are paid the avoided cost. He said that net metering has not been a problem in Wyoming where there are not many net metering customers, but it has been an issue in Utah and California and they are currently having rate case in Utah over the net metering issue. He stated that the main problem is the shifting of the fixed costs to other ratepayers.

In response to a question, Mr. Shafer stated that his company does not serve the data centers in Wyoming, although they do serve them in Utah. He stated that if they have to build new capacity, the cost would be rolled into the rate base. Then it would be a question of public policy as to whether that incremental increase was offset by the benefits of the data center.

Mr. Joe Milczewski of Cheyenne Light Fuel and Power stated that his company does serve the data centers. He noted that they like the data center because they have a consistent load and they may actually bring prices down. He noted that while they are building a new power plant, that decision was made before Microsoft entered. He said that the rate case is still open, but because coal plants have gone offline ahead of schedule, rates will go up.

Ms. Shannon Anderson of the Powder River Basin Resource Council provided two handouts to the Committee on Carbon pollution (see Appendix 7 for a copy of the handouts). She noted that the EPA was recommending a 19 percent carbon pollution reduction in Wyoming which is less than the national average. She stated that it can be done through a number of ways and the state has some flexibility. In response to a question, she noted that it may be possible to do emissions trading though there are some complex issues involved. She noted that there is not any regulatory impediment to using carbon dioxide for enhanced oil recovery, the impediment is the technology and the expense.

Mr. Shawn Reese of the Governors policy office provided a handout to the Committee on data centers (see Appendix 8 for a copy of the handout). He stated that the program requires a match of 125%, at least half of which is wages in jobs that pay greater than 150% of minimum wage. He noted that Microsoft has made a $500 million investment and created 27 jobs. He stated that for the first phases the property tax generated will be $22.6 million over a 10 year period in addition to the matching requirements. In response to a question Mr. Reese said that the state investment was $12.8 million which would provide $22.6 million in property taxes over 10 years, plus 27 high paying jobs. He noted that dividing the cost per job would not represent a full analysis of the situation. Senator Case stated that it would be appropriate to do the full analysis and to consider the cost per customer.

Mr. Minier stated that the decline of coalbed methane caused a loss of the economic base in certain areas of the state and since there are fewer ratepayers in those areas there are fewer people to spread the costs across. He noted that Rocky Mountain Power has pushed the timeline for the gateway west project beyond 10 years, which is a significant change to their capital plan. He stated that actions taken by the EPA have been having a significant impact and the Commission would be sending a letter to the EPA, explaining why their actions have created a problem for Wyoming. He noted that the EPA did allow some flexibility in providing a glide path for actions to occur in 2020 through 2030, instead of specifying that all actions had to be complete by 2025. He stated that he did not believe that the targets that were set were right for Wyoming. He said that this is a fight that the state needs to be engaged in.

Mr. Minier stated that the Rocky Mountain Power system crosses parts of 6 states and is based on a negotiated cost allocation with some items paid by state ratepayers and some that are considered system assets. In response to a question, he stated that if the system were to be split apart the costs would likely skyrocket for all of the states including Wyoming.

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

SECRETARY OF STATE UCC Articles 1 and 7 Mr. Tony Wendtland addressed the Committee on the Uniform Commercial Code (UCC). He stated that he is a member of the Wyoming delegation to the Uniform Law Commission whose purpose is to promote uniform acts that states can use or adopt with modifications in subjects that lend themselves to uniformity in state law. He noted that in part the adoption of the uniform laws may prevent federal oversight while providing for some local control.

He noted that the 1961 version of the UCC was revised in 2003 and that, while some portions have been revised in Wyoming, Wyoming has not yet considered the changes to Article 1 and Article 7. He stated that they have organized an informal sub-committee including Representative Stubson, Mr. Rob Berger, Mr. Scott Meyer and Mr. Mike Geese to do a line by line comparison and present the results at the Committee's meeting in September.

Senator Scott moved that the Committee urge the group to proceed and report to the Committee in September. The motion was seconded and passed by voice vote.

Referendum Revisions Ms. Peggy Nighswonger of the Secretary of State's Office addressed the Committee concerning referendums. Ms. Nighswonger provided a handout to the Committee on referendum revisions (see Appendix 9 for a copy of the handout). She noted that the statutes are somewhat vague and are also intertwined with the initiative process. She suggested that it would be appropriate to consider separating the processes so that the provisions related to initiatives are in article 1 and referendums are in article 2. She noted that under the current initiative process, the proposal is required to be sent to affected state agencies to determine the fiscal impact. Recently, a referendum proposal was rejected three different times for not meeting the requirements for certification. The fiscal review process was repeated as required for each draft, which placed a significant burden on the agencies. She suggested that the application and submittal process should be clarified so that the proposal goes through an initial review to determine if it meets the requirements for certification. Once it is certified, the proposal can then be sent to the agencies for review, avoiding the issue of reviewing multiple versions of the same proposal. She said that they would continue to work on these issues and would work with LSO to clarify the process.

Mr. Steve Klein of the Wyoming Liberty Group addressed the Committee concerning the initiative and referendum process. He provided a handout to the Committee on the topic (see Appendix 10 for a copy of the handout). He stated that direct democracy should be kind of difficult but any barriers should not interfere with political speech. He stated that it was important that people have the right to petition. He said that part of that right is to allow people circulating petitions to come in from out of state and those people should be allowed to collect based on payment per signature.

Mr. Klein said that there was extensive litigation in Colorado on these types of cases and that it is a first amendment issue which is subject to strict scrutiny. He said that the court there held that the limitations on circulators were too restrictive to uphold the government's interest in preventing fraud.

Senator Scott moved that LSO work with the Secretary of State in preparing a bill that will address the issues related to referendums and initiatives as well as the limitations on circulators, provided that the Secretary of State's Office obtains a review by the Attorney General's Office of the memorandum provided by the Wyoming Liberty Group. He stated that the topics may be done in separate bills if required. The motion was seconded and passed by voice vote.

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

Special Election Issues Ms. Nighswonger addressed the Committee on issues related to special elections for the House of Representative. She provided a handout to the Committee on Congressional special elections (see Appendix 11 for a copy of the handout). She stated that vacancies in the Senate are filled by appointment, but vacancies in the House of Representatives are filled by special election. She noted that under current law the special election is held 55 days after the vacancy occurs. There are 15 days to nominate and 20 days to certify by the Secretary of State, which only leaves the county clerks about 10 days to get the ballots designed and printed. Under the Military and Overseas Voter Empowerment Act (MOVE Act), ballots have to be sent out 45 days before the election. She said that with a 55 day time period there is not a clear way to get ballots sent out within 10 days which would lead to an automatic federal violation. She said that they would propose changing the special election to 80 days after the vacancy and reducing the time for the Secretary of State to certify nominee from 20 days to 3 days. This would allow the county clerks 12 days to design and print ballots. She noted that this process would have to be exempted from the statute regarding how to compute time. She also suggested that it not be 80 days but rather the Tuesday following the 79th day after vacancy occurs unless it is a federal holiday, to ensure that it is not on a holiday or Sunday.

In response to a question, Ms. Nighswonger stated that Montana has a time frame of 85 days. Some states have not addressed this and several states are in court over this issue.

Ms. Sherry Daigle, Teton County Clerk, stated that while it is a simple ballot with one race it would still take some time for printers. She noted that a few counties get their printing done from out of state and the coding is done out of state in some cases. She noted that a quick turnaround time to get ballots printed would be two weeks and the 12 day time frame which is provided in the proposed change would be tight. However, the 80 day proposal is more comfortable, while the 55 day time frame that is currently in place is not possible.

Representative Zwonitzer moved that the LSO draft a bill addressing the number of days and other concerns raised by the Secretary of State and the motion was seconded. Representative Kirkbride stated that it may be appropriate to consider the 6 month time frame and with the changes there could be a special election and then a primary or general election just a few days later. After additional discussion the motion passed by voice vote.

Ms. Pat Arp of the Secretary of State's Office stated that they looked at other elections which might have issues with the MOVE Act but the only issue they found was the special elections for Congressional vacancies.

SPECIAL DISTRICT FORMATION Ms. Margaret Brown of Laramie Main Street Alliance addressed the Committee on Downtown Development Authorities. She provided handouts of some resolutions from Cheyenne and Casper (see Appendix 12 for a copy of the handouts). She noted that these elections are usually a very limited number of voters, approximately 30 to 150 voters. She stated that she would like the vote to be done entirely through absentee ballot so that it would not require the expenses for a normal election.

Ms. Debbye Lathrop, Laramie County Clerk, stated that she was not sure if mail ballots were prohibited or if the Downtown Development Authority (DDA) just preferred not to use them. She noted that a DDA is not a special district.

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

Ms. Brown stated that requiring that the election be held by mail would be easiest, but making it permissive would also be acceptable.

Representative Zwonitzer moved that the interested parties work together to consider options on this issue and the motion was seconded. Ms. Arp noted that there may be a constitutional issue and that there may be a requirement to have at least one polling place on Election Day. After additional discussion the motion was passed by voice vote.

Mr. John Farr of Encampment noted that in order to form a museum district it requires 25% of the value in the district to have a special ballot. He noted that the hospital district rules were recently changed to address this issue. He noted that in Carbon County four ranches with absentee owners make up most of the value in the county. That situation makes it virtually impossible for special districts to get on the ballot. He noted that tourism is the second biggest economic driver in the state and in many towns it is the biggest. He said that museums are important to tourism and that it was important to have these elections locally and provide local funding for these projects. In response to a question he noted that each county is different and everyone they have contacted is interested in this concept.

After additional discussion, Representative Paxton moved that LSO to draft a bill similar to the one recently passed for hospital districts to address museums. The motion was seconded and passed by voice vote.

VOTING CENTERS AND ELECTRONIC POLLBOOKS Ms. Arp addressed the Committee on voting centers and electronic pollbooks. She provided a handout to the Committee on the topic (see Appendix 13 for a copy of the handout). Ms. Arp walked through the handout. She noted that the cost of the electronic pollbook system would depend on what functionality is desired. She stated that some of the important discussion points are what functionality the system should have, whether it should have WyoReg remote access and what type of connectivity is available at polling places. She noted that it has the potential to make the polling place more convenient, but it was important to make sure that it did not make it slower than it is currently.

Ms. Arp stated that she did not think it would need to be mandatory and that creation of the initial system would be a fixed cost whether one county or all counties use it. She said that it would likely not make sense for every county to implement the system even if it was available.

Co-chair Berger stated that the Committee should look at the language on fiscal notes and consider why they do not include county or other impacts.

In response to a question, Ms. Arp stated that if the system had a connection then those clerks using the system could do checks immediately while those not using the system would do the check after the fact. In that case, some clerks would be doing checks the same as they are currently while others would be doing it more quickly which would not cause any issues in the system.

Ms. Lathrup stated that the state would only get 100% of what it wants if all counties are connected to the system in real time, but that is not feasible. She said that the ideal would be to transition to a vote center system where voters could go to any vote center and vote, rather than going to a specific voting district. She noted that Laramie County had looked into implementing an electronic pollbook and determined that it would represent a potential savings and would not be an unfunded mandate.

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

Representative Byrd moved that LSO resurrect the previous legislation on this topic for consideration at next meeting. Senator Scott moved that LSO consult with the clerks on how to word the legislation so that the election would continue if the system goes down. The motion was seconded and passed by voice vote.

MEETING RECESS The Committee recessed at 6:45 p.m.

CALL TO ORDER (JUNE 4, 2014) Co-Chairman Berger called the meeting to order at 8:30 a.m.

INSURANCE DEPARTMENT Affordable Care Act Update Mr. Tom Hirsig of the Department of Insurance provided and update to the Committee on the Affordable Care Act. He provided a handout to the Committee on the health insurance market overview (see Appendix 14 for a copy of the handout). He noted that 67% of enrollees nationwide paid their first month, while in Wyoming that was 78%. He noted that they are trying to establish a baseline over the last three years to determine if there are more people insured or not. He noted that under the affordable care act there is more opportunity for out of state sales but there has not been any activity in that area at this point. He noted that the next open enrollment period is November 15, 2014 to Jan 15, 2015. He noted that there is not likely going to be a big push for a state exchange as the federal exchange more successful than the state exchanges. He said that the loss ratios have skyrocketed because the people that enrolled were the people that needed insurance. He said that the bailout programs at the federal level will be based on year end and it is not clear what will happen, though it does look like it has started to flatten out compared with the period immediately following enrolment.

Fine Schedules Mr. Jim Mitchell of the Department of Insurance addressed the Committee on fine schedules. Mr. Mitchell provided a handout to the Committee on the current penalties and suggested changes (see Appendix 15 for a copy of the handout). He noted that there were 42 or 43 total actions last year, while as of June 4 of this year there were 46. He said that the current fine schedule is not a deterrent and is the lowest among surrounding states. He said that the Department would also like a way to negotiate with violators so that they would not have to report minor violations. He noted that a higher fine would be more of a deterrent and that other states are more likely to notice higher fines that are reported.

Mr. Mitchell stated that their recommendation is to increase the fine from $500 to $1,000 per offense and to remove the aggregate limitation, increase the fine from $2,500 to $5,000 for “person” and also remove the aggregate limitation. He noted that they are also requesting the ability to levy costs not to exceed $500 which would give the Department some ability to negotiate for minor violations which they would have to report.

Mr. Dave Alden stated that one reason for the aggregate limit would be for someone who had made a small error which continued month to month and if it were considered as multiple violations there would be a large fine.

Mr. Mitchell stated that they would treat that as one offense. In response to a question, Mr. Mitchell stated that most other states do not have a max and if the aggregate limit is retained he suggested removing the three month limitation.

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

Senator Scott moved that LSO to draft bill based on the proposed legislation. The motion was seconded and passed by voice vote.

Portable Electronic Device Insurance Mr. Dave Picard on behalf of Asurion addressed the Committee regarding portable electronic device insurance. He noted that this topic was considered in prior legislation but was pulled back due to some of the complexity and added to the interim topic list.

Mr. Matt Nowels of the Meenan Law Firm stated that customers purchase this insurance at the point of sale of the device and if there is a claim they get a replacement of the same device or a similar product. He stated that most of the claims are handled online or through a call center and the claim is opened and closed within the same transaction. He stated that current law was not written with this type of business practice in mind. He said that the call centers are supervised by a licensed adjuster or licensed agent. He said that in the 35 states that require adjuster licensing, 29 of those have passed legislation on this topic.

Mr. Paul Fassbender of Asurion stated that they are the insurance provider for cell phones and that their customers receive a new phone within 24 hours. He noted that they do have licensed agents in Wyoming and they route claims through them, but the proposed legislation would allow for a 25 to 1 ratio where the licensed adjustors supervise the claims representative.

In response to a question, Mr. Fassbender stated that the claims are very simple and either the phone is broken or not and either the phone is covered or not, that is the extent of the call. He noted that if they are getting multiple claims they may look into whether it is a case of fraud, but otherwise the claims are very simple.

Mr. Nowels stated that most are closed in matter of 5 minutes and under current law the call taker would need an adjuster's license. The proposed bill would allow 25 call center employees to be supervised by 1 licensee. The bill also defines the automated claim adjudication system. He said if there is any question which needs to be addressed outside of the automated system it would be handled by the licensee.

Senator Scott moved that LSO draft a bill based on the proposed language. The motion was seconded and passed by voice vote.

Electronic Delivery of Insurance Documents Co-chair Case noted that this topic was added to the interim topics list but that it appeared to be a non- issue. Co-chair Berger noted that there may have been some confusion and that the electronic delivery was optional.

ELECTRONIC RECORDS Social Media – Death of Account Holder Mr. Tim Lockwood of the AARP said that currently if a loved one is incapacitated or has died, Facebook will delete their account upon receipt of the death certificate. However, some people choose to leave the account open in order to share memories, but there is no way to access the account if there are any issues with the account. He said that he would like there to be consideration of allowing loved ones to gain access to these accounts when the account holder is incapacitated or dies.

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

Representative Zwonitzer stated that a bill had been drafted but not introduced on this topic. He noted that the account is kept as a memorial page, negative comments cannot be removed. He noted that there are some privacy issues that may need to be addressed. He said that several other states had considered the issue and that the prior bill was based on legislation from Oklahoma.

After additional discussion, Representative Byrd moved that the previously drafted bill be resurrected for consideration at the next meeting. The motion was seconded and passed by voice vote.

Employer's Review of Social Media Representative Petroff noted that 2014 Senate File 81 attempted to address the problem of an employer or potential employer requiring the employee's password to social media accounts. She noted that this has not been a demonstrated problem in Wyoming but that it was a concern in some other states and raises issues of privacy.

Mr. Byron Oedekoven of the Wyoming Association of Sheriffs and Chiefs of Police said that social media is an interesting animal, particularly for law enforcement. He stated that employee conduct is a concern and that there is a difference between private messages to mom and public risky behavior which could cause the city or county liability. He noted that they would look at the account together with the employee and let the employee explain the content.

Representative Petroff noted that nothing in the bill would stop an employer from looking at what an employee has made public on Facebook or other social media accounts.

Mr. Dan Neal of the Equality State Policy Center said that this is a very interesting topic and that it normally would require a warrant to look at private conversations, but with the employer-employee relationship there are blurred lines. He stated that with the way that technology is penetrating the lives of people there is a need for some legislation. He stated that, in addition to social media, things like private websites and blogs should receive the same protection. He noted that it also may be necessary to prohibit other kinds of intrusion such as acquiring access through other means. He noted that it may be appropriate for an employer to request an employee to change privacy settings. He stated that there is some model legislation that could be considered.

Representative Coleman stated that in general she supported the philosophy behind the bill, but the members of the House got hung up on the details. She said that it would be important to tighten up the language and to consider different professions that might need protection. In response to a question she stated that it might be appropriate to ban schools from getting access to student pages as well. She said that under law enforcement they can get access after reasonable suspicion of wrongdoing and that is the proper way for schools to get access under a legitimate law enforcement investigation.

Senator Scott stated that prohibiting access would potentially provide some protection for those employers who have a policy of not looking.

Senator Scott moved that LSO draft a bill based on the bill as it passed the Senate in the 2014 session and that the bill also be shared with the Digital Privacy Task Force. The motion was seconded and passed by voice vote.

COSMETOLOGY AND BARBER'S BOARDS Mr. Gerry Hoppman of the LSO addressed the Committee on the Board of Cosmetology and the Barber's Board. He noted that they had reviewed Title 33 and had noted the similarities between the two boards.

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

He noted that both boards were created in the 1930s to protect public safety. He noted that the difference between the two boards is that the Board of Cosmetology is more segmented and provides for the licensure of nail technicians and other subcategories. He stated that there are approximately 5,000 licensees for cosmetology with 1500 salons and 21 schools which provides for a deep licensure base and more revenue. He noted that there are approximately 300 licensed barbers and 185 shops with no schools in the state which represents a big difference in revenue. He noted that the Barber's Board cannot afford staff and used the accounting services as well as other services from the Board of Cosmetologists and they pay the Board of Cosmetologists a fee to use those services. He noted that Alaska and Montana have combined these boards. He said that the biggest issue would be to make sure that it is not benefiting one group over another.

Ms. Brenda Mathre of the Board of Cosmetology said that it could be a value to combine the boards and that the Boards may need to be joined in order for the barbers to grow as a profession. She stated that about a third of barbers in the state are over age 60 and that joining boards may allow them to have a school.

Mr. Dennis Schildhauer of the Board of Cosmetology said that there would be no problem with merging the two boards and that it would be important to keep the identities of both professions separate. He said that there are a small numbers of barbers and combining boards may help them preserve their profession.

Ms. Christine Chesser stated that she was in favor of combining the boards and that it would be an easy fit to license barbers as the two professions mesh really well together. She stated that it would be possible for both professions to retain their identities and that it would be beneficial to both boards.

Mr. Dave Parsons of the Barber's Board stated that barbers in general have no interest in combining the boards. He noted that they have discovered an issue in their rules which prevents the opening of barber schools within the state and they are looking into addressing that issue. He stated that they are actively working on increasing their numbers and if they could accomplish that they would not need to combine boards. He noted that some states have combined the boards and some of those have regretted taking that action.

After additional discussion, Representative Zwonitzer moved for the formation of an ad hoc committee where he and Representative Petroff could meet with the barbers and cosmetologists and work together to determine if there is any way to combine these. The topic would then be discussed again at the September meeting. The motion was seconded and passed by voice vote.

WYOMING AGGREGATE CAMPAIGN CONTRIBUTION LIMITS McCutcheon v. FEC Ms. Anne Marie Mackin of the Center for Competitive Politics addressed the Committee concerning aggregate campaign contribution limits. Ms. Mackin provided a handout of her comments to the Committee (see Appendix 16 for a copy of the handout). She said that the limit on aggregate campaign contributions was invalidated at the federal level based on first amendment grounds. She stated that W.S. 22-25-102(c)(ii) is unconstitutional following the McCutcheon v. Federal Election Commission decision. She noted that eight states with such limits have already determined that they will not enforce the limits as a result of the McCutcheon case.

In response to a question, Ms. Mackin noted that the base limit on campaign contributions was justified as that could be corrupting, but the aggregate limits do not serve that same purpose in preventing corruption.

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

Ms. Nighswonger of the Secretary of State's Office provided a handout to the Committee on this topic (see Appendix 17 for a copy of the handout). She noted that any potential violations of the statute would be referred to the Attorney General's Office and possibly to a local prosecutor and it would be up to their discretion on whether to enforce it as a violation of the statute.

Mr. Klein of the Wyoming Liberty Group stated that he agreed with Ms. Makin’s assessment and that there is a conflict with how to proceed. He stated that they would not pursue attorney’s fees if they were to pursue this issue in court. He stated that it was important to have a stable and predictable election code which is simple to follow and to comply with.

In response to a question, Mr. Klein stated that it has been held that a millionaire cannot be limited from spending his own money on his own race, but there are stories where people get outspent and still win their races.

Mr. Neal of the Equality State Policy Center said that it was important to consider how elections are being perceived by the public. He said that the way to get at this is with more reporting and more teeth if there are violations. He said that while the aggregate limit has been thrown out, it is still important to protect the system and help people keep trust in the system.

Senator Scott moved that the LSO draft a bill draft to repeal the aggregate limit. The motion was seconded and passed by voice vote.

Senator Scott moved that the Committee recommend that the Secretary of State seek a formal opinion from the Attorney General on whether the aggregate limit will be enforced in the 2014 election and that the Committee also authorize the co-chairmen to join in that request or to make their own request for a formal opinion on behalf of the Committee. The motion was seconded and passed by voice vote.

After additional discussion, Senator Scott moved that LSO draft a bill to remove the PAC contribution limits which will go into effect next year. The motion was seconded and passed by voice vote.

MEETING ADJOURNMENT There being no further business, Co-Chairman Case adjourned the meeting at 2:45 p.m.

Respectfully submitted,

Senator Case, Co-Chairman Representative Berger, Co-Chairman

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

Committee Meeting

Materials Index

Appendix Agenda Item Appendix Description Appendix Provider

1 Committee Sign-In Sheet Lists meeting attendees Legislative Service Office

2 Committee Meeting Provides an outline of the topics the Legislative Service Office Agenda and Materials Committee planned to address at meeting Binder

3 Telecommunications Update on CenturyLink CenturyLink

4 Unified Network Update on Unified Network State Chief Information Officer

5 Prepaid 911 Draft legislation on prepaid 911 ATT Wyoming

6 Prepaid 911 Letter on prepaid 911 Wyoming Retail Assoc.

7 Carbon pollution EPA information on Carbon Pollution Powder River Basin Resource Council

8 Data Centers Data Center Program Wyoming Business Council

9 Referendum Revisions Referendum Revisions Secretary of State

10 Petition circulators Petition Circulators Wyoming Liberty Group

11 Special elections Congressional special election Secretary of State

12 DDA DDA election resolutions Laramie Main Street Alliance

13 Electronic pollbooks Electronic pollbooks and voting centers Secretary of State

14 Health insurance Wyoming health insurance market Department of Insurance overview

15 Insurance fines Insurance fines and recommendations Department of Insurance

16 Aggregate campaign limits Aggregate campaign limit testimony Center for Competitive Politics

17 Aggregate campaign limits Aggregate limit information Secretary of State

JOINT CORPORATIONS, ELECTIONS, & POLITICAL SUBDIVISIONS COMMITTEE Summary of Proceedings

WYOMING LEGISLATIVE SERVICE OFFICE • 213 State Capitol • Cheyenne, Wyoming 82002 TELEPHONE (307) 777-7881 • FAX 307-777-5466 • E-MAIL [email protected] • WEB SITE www.wyoleg.gov