Senate Labor & Commerce Committee

Good afternoon. I'd like to call this meeting of the Senate Labor and Commerce Committee to order. The time is 1:30 PM. We are in Belts Room 105 of the Thomas Stewart Senate Stewart Building. Today is Friday, May 1st.

Members present are Senator Gray Jackson, Senator Merrick, Senator Dunbar, and myself, Senator Bjorkman. Senator Yunt is excused. Let the record reflect that we have a quorum to conduct business. Welcome everyone to Senate Labor and Commerce. Please turn off your cell phones and join me in welcoming our recording secretary, Carrie Tupow, and our LAL moderator, Jude Augustine.

Our agenda for today is Senate Bill 262, Social Media for Minors. And Senate Bill 150, Net Metering Program and Fund. First up is Senate Bill 262. This is our second hearing on the bill. During our first hearing, we had a presentation of the bill and took invited testimony.

I would like to invite my staff, Ms. Laura Asche, to the table to provide a brief recap of the bill. Ms. Asche, thank you for joining us. Please state your name and affiliation for the record and begin your brief recap.

Thank you, Chair Bjorkman. My name is Laura Asche. I'm staff to Senator Bjorkman of the Central and Northern Kenai Peninsula District D. Senate Bill 262 would prohibit social media companies from allowing Alaskans under the age of 16 to have accounts on their platform and would prohibit those same companies from giving Alaskans under the age of 18 pushed content if they do have an account. It would also put language in statute that would allow the Attorney General and also individual minors who may be harmed by reckless or knowing allowance of minors to be on social media companies to allow recourse to be taken against them. That's the quick summary, Chair Buerkle.

Very good. Thank you very much, Ms. Asche. Are there any questions for the bill sponsor staff?

Hearing and seeing none, we will go now to invited testimony. First up we have Mr. Jeff Dliffka, Esquire, attorney and teen advocate, joining us on the phone from Soldotna. Mr. Dliffka, welcome to Senate Labor and Commerce. Please state your name and affiliation for the record and begin your testimony.

Thanks for letting me speak today. My name is Jeffrey Daleska. I'm an attorney on the Kenai Peninsula and a youth advocate. So there's a major issue that needs to be addressed regarding youth in Alaska. According to the Pew Research Center, roughly 1 in 5 teens say they are on TikTok and YouTube almost constantly.

At the same time, 64% of teens say they use chatbots, including 3 in 10 who say they do so Daily. Nearly all U.S. teens say they are on the internet daily, including 4 in 10 who say they are online almost constantly. According to Common Sense Media, um, kids spend a significant amount of time on screens averaging, ranging based on age, uh, between 7 to 9 hours daily, and that is in tweens around 4 to 6 hours, and that is 8 to 12, uh, not including schoolwork. These numbers are, are shocking, but not, not surprising if you, if you look around. A survey from the Centers for Disease Control found that 50% of high school girls and 29% of high school boys felt persistently sad or hopeless in 2021.

It also found that 22% of high school students and nearly a third of high school girls reported that they had seriously considered attempting suicide in the preceding years. Social media is a leading driver of youth mental health issues. And similar studies revealed when children and teens reduce or eliminate social media for a long period, there are mental health benefits. This bill, in my mind, attempts to address the issue that is sweeping across the entire world. I believe Alaska should take action and pass this bill.

Countries including Australia, France, Denmark, Norway, Australia, Brazil, Germany, Greece, India, Indonesia, Malaysia, Norway, Slovenia, Poland, Spain, Turkey, and many more are, have either banned or in the process of banning or restricting young people based on their age for social media access. In the United States, the Senate, led by Ted Cruz and supported by 14 co-sponsors of different parties, have introduced legislation to establish a minimum age of 13 and to ban addictive algorithm, algorithms. This bill, which has significant bipartisan support, would also require schools to block access to social media. Roughly half the U.S. states are advancing laws requiring platforms' restrictions, including on con— adult content, online gaming services, and so— social media apps to block underage users. Additionally, Arkansas, Florida, Louisiana, Mississippi, Mississippi, Ohio, Tennessee, California, Utah, Texas have already enacted or, uh, one type of a ban.

Even most recently, Governor Newsom of the large state of California came out in support of social media bans, bringing him into alignment with Governor DeSantis of Florida. And that should surprise everybody since they don't agree on anybody or agree on anything. So what could lead to the tidal wave of of concern spreading across the world and in the United States? And is it justified? My answer is yes.

And my primary concerns are as follows. I have major concerns with mental health of our youth. There are significant correlations between social media usage in children and mental health risks. Higher rates of anxiety, depression have been linked to heavy social media use. According to the Pew Research Center, Roughly 1 in 5 teens say that social media harms their mental health, and a growing number believe it harms people their age.

Children often compare themselves to unrealistic filters and versions of themselves, which can negatively affect their self-esteem. Teenage girls are even more— the more teenage girls are on social media and exposed to image-based social media in particular, they are more likely to have body image issues. Another concern I have is cyberbullying. Back in my day, bullies could not follow you home and relentlessly torment you. Today, cyberbullying can continue long after school hours.

Online bullying can be constant and anonymous, making it harder to escape than in-person bullying. I have personally sat with parents who are at their wit's end trying to stop the never-ending barrage of online harassment directed at their kids. The problem is that there is often little to no recourse for bullying that occurs after school hours, and parents or guardians of the bullying child, if parents of a bullying child choose not to take action. Furthermore, children do not fully understand the consequences of their actions, yet they are given a platform that allows them to potentially spread misinformation or attacks, attack others before a massive audience. I have major addiction concerns.

The number of hours children spend on screens speaks for itself. Social media platforms are designed to keep users scrolling through likes, notifications, and endless content. This can reduce attention spans and disrupt homework, making it harder for kids to enjoy offline activities. There also appears to be a strong cor— negative correlation between the time spent consuming short-form video content and teens' ability to sustain attention, which in turn impacts academic performance. Late-night social media use also interferes with sleep due to the screen light exposure and emotional stimulation.

Two recent court cases, KGM v. Meta and Google and New York Attorney General v. Meta, in both those cases, juries found that, found against the Meta and Google and instituted civil fines. They found the companies were negligent in their platform design and that features like infinite scroll, autoplay, aggressive push notifications were engineered to be addictive. In the other case, the jury found that companies failed to warn users of these risks and that Meta misled the public about the safety of its platform for children and failed to prevent child exploitation. Another concern I have is exposure to inappropriate content. It is extremely difficult for parents to restrict what their children can see on social media, and ad content is difficult to censor.

Children may encounter violent, sexual content, and/or drugs. Even when they are not seeking them out. Algorithms push extremely unhealth— pushing extremely unhealthy content over time. And this trend is extremely prevalent against young women. Reduced real-world skills.

I think everybody sees this. Children sitting next to each other focused on their phones, not communicating with their children— with their, excuse me, with their friends, or being present in the moment. They are missing out on being children and making memories. I see this impact even in my own usage, how I, how disengaged I become when I am using social media. Privacy concerns and safety risks.

Children may overshare personal information without understanding the long-term consequences. There is also the risk of contact from strangers or predators, which was a major issue in the previous mentioned case that I just mentioned. Major concerns exist also with the storage of data. From messages or private photos. Imagine a company that's holding your private information starting at age 8 or 9.

Whether through authorized releases, hacking, or blackmail, the potential consequences are, are truly frightening if they have this information going back that far. I do not want to minimize the opposition's argument ranging from First Amendment claims, many of which are still currently being litigated, or concerns about invasion of parental rights, or beliefs that social media, uh, provides certain benefits. However, in my opinion, the negative impacts clearly outweigh the benefits and objections. We already have age-based regulations for children in a wi— wide variety of areas, including but not limited to movies, gambling, television content, videos, uh, online gambling, adult websites, alcohol, tobacco, e-cigarettes, driving age, uh, and, and many, many more. We even treat them differently in the criminal justice system.

So why should social media be any different? I am fully aware of the current legal cases that are going on related to bans, but I believe these legal battles are worth pursuing to benefit youth in Alaska, and I support SB 262. That's all I have. Thank you very much, Mr. Dlifka. Are there any questions from committee members?

Seeing and hearing none, Jeff, thank you so much for your testimony today, and it's good to hear from you. We'll go next. Thank you. You betcha. We'll go next to Mr. Noah Shields.

He is a marital and family therapist. Mr. Shields, thank you for joining us today. Please state your name and affiliation for the record and begin your testimony, please.

[Speaker:NARRATOR] My name is Noah Shields. I'm a licensed marital and family therapist in Alaska. Mr. Chair, members of the committee, thank you for the opportunity for me to speak today. I currently serve as chair of the State of Alaska Marital and Family Therapy Board and as president of the Association of Marital and Family Therapy Regulatory Boards.

I want to be clear that I'm not speaking on behalf of either board today, but rather from my direct experience as a clinician working with children, adolescents, and families across our state. Also as a parent and lifetime Alaskan. I'm speaking in support of Senate Bill 262, which seeks to limit access to social media for young youth aged 16 and under and to place restrictions on the use of addictive algorithms by social media companies for minors. In my clinical work, I'm seeing a consistent and concerning pattern, seeing increasing levels of anxiety, depression, disregulation, and relational disconnection among youth that correlate strongly with excessive screen use and social media engagement. This is not abstract.

It is showing up in therapy rooms across Alaska in a very real way. Data supports what clinicians are observing. A 2021 survey by Common Sense Media found that teens average over 8 hours of screen media use per day. While tweens average nearly 6 hours. Figures that do not include time spent on schoolwork.

Social media platforms occupy a significant portion of this time. A 2023 Gallup study showed about 4.8 hours per day was used on social media. And these social media platforms are intentionally designed to maximize, maximize engagement through algorithmic reinforcement. These platforms are not neutral tools. They are engineered environments that leverage developmental vulnerabilities, particularly in adolescents whose brains are still forming around reward sensitivity, impulse control, and identity formation.

Features such as infinite scroll, intermittent rewards, and algorithm, algorithm-driven content delivery are designed to keep users engaged for as long as possible. For youth, youth, this can quickly become compulsive use. But an equally important question is not just what social media is doing to youth, but what it is replacing. When young people spend 6 to 8 hours per day on screens, that time is no longer available for those face-to-face relationships and social skill development, physical activity and outdoor exploration, creative play and problem-solving, family connection and intergenerational bonding, sleep, which is the foundation for mental health. In Alaska, where community resilience and connection to place are vital protective factors, this displacement has serious implications.

We're not only seeing increased mental health symptoms, we are seeing a weakening of the very experiences that build strong, healthy individuals. SB 262 represents a thoughtful and necessary step toward protecting youth during a critical developmental window. Just as we place age-based limits on driver's permits, licensing, and access to substances and activities that pose risks to developing brains, it is reasonable to establish guardrails around technologies that are demonstrably impacting youth well-being. Importantly, this bill also addresses the responsibility of social media companies. The burden should not rest solely on parents and children to navigate systems that are intentionally designed to be difficult to disengage from, limiting the use of addictive algorithms for minors is a reasonable and appropriate consumer protection measure.

This is not about eliminating technology or resisting progress. It is about aligning our policies with what we know about child development, mental health, and the long-term well-being of our communities. I urge you to support SB 262 as a proactive step in safeguarding the health and development of Alaska's youth. Thank you.

Thank you very much, Mr. Shields. Are there any questions?

I have a question. Um, Dr.— I'm sorry, Mr. Shields, could, could you point to examples in your community or across Alaska where you strongly feel that, uh, minors' engagement on social media led to those, those minors harming themselves?

Certainly. Through the chair, um, you know, some of the things that we're seeing, um, in Alaska, of course, some of the, um, uh, Things that are happening online with the cyberbullying, the, you know, especially the things that are being communicated that is really invisible to a lot of the teachers, the principals, because it is happening online where there is bullying going on has, you know, can, has led to teens here dealing with a lot of issues with self-esteem and, and certainly trauma related to that bullying. And so, you know, one of the things that, you know, is really challenging, of course, with, you know, social media is that, you know, we don't as adults or teachers or mental health clinicians always get to see what's happening online, but it's things that kids are facing on a day-to-day basis. [Speaker:MICHAEL YOUNG] Very good. Thank you.

Okay. I actually had another question for Mr. Dlifka. Mr. Dlifka, are you still available?

Yes, I'm still available. Excellent. So there have been some questions raised about potential court challenges to legislation like this. With your expertise and kind of study of this issue from a legal point of view, how do you feel about the constitutionality of this piece of legislation, and do you feel it would survive a court challenge?

Yeah, thank you. Well, first off, I have no clue whether it would survive a court challenge. I think it is kind of up in the air. The, there is a couple of recent cases, one specifically last year where age restriction was, was allowed as it related to sites, you know, pornography sites, and that was Paxton. And I think the kind of argument is similar to that here.

My, my, I hope, I guess, it survives. And I think as more more countries and more studies react to this, the overwhelming push is going to again increase the odds. I do think this is narrowly tailored enough to address a specific issue, that there's an argument there. And as far as, you know, what's going to happen, I guess I can't say with certainty, but there's, you know, the U.S. Senate is pursuing one that's similar. Ted Cruz is one of the best constitutional lawyers in the country and seems to believe it is constitutional too.

But again, Paxton is probably the best tipping point to point to to say, hey, this is, you know, could survive this challenge. And again, I do believe the negatives are reaching a point where, again, there is, it makes sense to restrict this. It's kind of similar, you know, gambling. There's nothing inherently wrong with a slot machine, but there's a reason why we restrict kids' access to a slot machine because of the addictive substance. So it's narrowly tailored to address that issue, and I think that's kind of the way you have to look at this.

Very good. Thank you.

Also, Mr. Dlifka, in your experience in our community and across Alaska, can you point examples where minors' engagement on social media has led them to hurt themselves or others?

Yeah, I can bring two very distinct ones. One just relates to bullying. You know, I, again, I will have parents come to me and, you know, we have so many, we call them couch surfing teens, that are really unmonitored and And again, they can have access to social media. And these teens, again, being teens, some of them can be aggressive towards others. And so when, specifically with a good friend of mine, their daughter was just being relentlessly, you know, on Instagram and everything, just creating new accounts and constantly attacking them.

And she had to go and get counseling over it because it just never ended. It was constantly popping up. Popping up, and the parents had no recourse. And this, you know, again, the poor teen, and it's just couch surfing, and there's no real, you know, person to go and to talk to about that. And then again, outside of school hours, you know, where do you even go to locate?

So the bullying and the suicide, you know, that's a very real, real thing and a correlation. A much more serious one that I think Senator has been made aware is predators. I have a client whose special needs daughter was lured through a social media website, you know, 14, and was raped. And so, yeah, I am seeing real, real life, you know, again, attempts at suicide and these bullying. They are having massive implications.

Even our little, little town, there was just Recently, the child predator, I forget that website, Roblox, you know, was another one, just connected all the way back to our little town. So, you are seeing it hit home even in our little towns of the impact. And I think that we even have a further obligation here in Alaska given our climate. Since, you know, our days during the winter are very short, we are inside so much. More time.

And I bet that we probably have even higher screen time than the national average as we're stuck inside so much. And so, you know, again, that's going to even further emphasize the need for this, I think, here in Alaska. Very good. Thank you, Mr. Delifka. Any further questions?

Seeing none at this time, we will open public testimony on Senate Bill 262. Is there anyone in the room who would like to testify to this item? Seeing none, we will go online to Ms. Amy Boss. She is the Vice President of Government Affairs for NetChoice. Ms. Boss, welcome to Senate Labor and Commerce.

Please state your name, affiliation, and location and begin your testimony, please.

Yes. Good afternoon, members of the Committee. My name is Amy Boss. I'm the vice president of government affairs, uh, testifying on behalf of NetChoice in Washington, D.C. NetChoice is a trade association dedicated to making the internet safe for free expression and free enterprise online. Respectfully, NetChoice opposes SB 262, and we do so while fully supporting the bill's core goal, protecting Alaska's youth.

However, this bill has a number of fatal flaws. First, it is unconstitutional. The Supreme Court has consistently protected minors' First Amendment rights. Social media platforms are forums of protected speech, and blanket age bans don't survive constitutional scrutiny. This has been proven in court repeatedly, most similarly in 2011 against an effort to mandate parental consent for video games.

This case is Brown v. Entertainment Merchants Association. While we regulate many things out of youth's easy reach, speech is not alcohol, and it's not cigarettes, and it's not gambling. General speech has special protections from government restrictions that physical substances simply do not have. Second, this bill creates massive privacy and security risks To enforce an age ban, platforms would need to collect government IDs, biometric data, or financial information from every user. That creates a centralized target for hackers and predators, the opposite, we believe, of protecting children.

Online bans and restrictions for children trigger age verification for everyone. Since there is no way to prove you are a minor, adults will instead have to prove that they are not a minor. Third, we believe that this usurps parental rights. Many Alaska parents believe their teenagers can safely use social media with appropriate guidance. This bill removes that family decision-making and replaces it with a one-size-fits-all government mandate.

Multiple states have already tried versions of this bill. Louisiana passed nearly identical legislation, Act 456, NetChoice has obtained a permanent injunction against it in December of last year. Similar bills in California, Arkansas, Ohio have been blocked in court on similar grounds. These states are spending taxpayer money defending unconstitutional laws, and we urge Alaska not to follow this path. I do believe it's helpful also to look at how media bans are working elsewhere.

In Australia, outlawed— Australia has already outlawed much of social media for residents under 16. Age, the country's own eSafety Commissioner reports that they have not observed a notable change in the number of cyberbullying and image-based complaints involving age-restricted accounts across platforms in January and February of this year when compared to the same period last year. The Commissioner's research further revealed that among parents whose children held accounts in Instagram, Snapchat, and TikTok before the ban, about 70% reported that their child still had access. In part, this is because VP— of VPN tools that hide identity, and age downloads nearly tripled during this time. Simply put, social media bans for youth, we believe, don't work in practice and bring substantial downsides to privacy and free speech.

We share, again, your commitment to child safety, and we'd welcome a conversation about constitutional approaches that protect kids without building a honeypot of sensitive data or trampling parental rights. We respectfully urge you to oppose this bill, and I'm happy to answer any questions. Thank you for your testimony.

We'll go now to Adhan Downey. Please state your name, affiliation, and location for the record and begin your testimony, please.

Good afternoon, Chair, members of the Committee. My name is Aiden Downey. I'm here representing the Computer Communications Industry Association in Reno, Nevada, to respectfully oppose Senate Bill 262. While we and our members share the Committee's goal of increasing online safety, this bill introduces significant constitutional operational concerns that would negatively impact Alaska's residents. I think Amy from NetChoice did a great job sort of explaining a lot of our concerns with the bill.

So in the interest of time, I'm happy to sort of echo her comments. Another sort of group I did want to highlight and some of their research that they've done, the Molly Rose Foundation, which works to prevent suicide and improve online safety, describes this legislative model as deeply important for other jurisdictions to implement similar bans. So we urge the committee to focus on parental empowerment and digital education rather than a ban that's easily bypassed. We respectfully ask for a no vote. On SB 262.

Thank you. Thank you for your testimony. Up next, back to invited testimony, we will go to Dr. Keith Hamilton. Dr. Hamilton, thank you for joining us. Please state your name and affiliation for the record and begin your testimony, please.

Good afternoon, my name is Dr. Keith Hamilton, and I am calling as a president of one of the local state colleges, private colleges. And I apologize for any background noise. I'm at SeaTac Airport. I just landed. Definitely wanted to bring testimony to you today.

I come as somebody who has a doctorate in youth and family culture, and that doctorate has allowed me to do a lot of work in this exact matter. But I've also been on the Alaska State School Board education for 8 years and also picked up quite a few conversations regarding this issue. So let me go ahead and provide some testimony.

One second.

I'm in a quiet place now. Social media has become one of the most powerful forces shaping students today, especially high school and college age students that I serve. And while it connects people and shares information quickly, there is growing evidence that it also carries real downsides. And I want to bring a few of those before you because they are pretty hard to ignore. First, social media affects the mental health.

Constant exposure to curated, idealized lives creates unrealistic comparisons. So we have seen our students just scrolling and scrolling and scrolling through their highlight reels, looking for perfect bodies, perfect vacations, expectations, perfect success, and quality measuring their lives against them. And this often leads to increased anxiety, low self-esteem, and even depression. We see a lot of that. Students from organizations like the American Psychological Association have shown a strong correlation between heavy social media use and poor— excuse me, one second.

Hard to do this at an airport. One second. Yes. So American Psychological Association has shown a strong correlation between heavy social media use and poor mental well-being, especially among these young adults. But I also want to share that on our side, it really damages and focuses the academic performance.

Social media platforms that we know of are designed to keep attention, endless scrolling, notifications, or short bursts of content, but training now the brain to expect constant stimulation. And this makes it harder to concentrate on long lectures, deep reading, and sustained study. A student might intend to study for an hour but ends up checking their phone every few minutes, breaking concentration repeatedly, and over time this weakens memory and learning. Also been aware of sleep disruption through different studies and students using social media late into the night, and that blue light from the screens and the mental stimulation delay those sleep cycles, reducing both the quantity and the quality of rest. And poor sleep, we know, directly impacts their mood, their decision-making, academic performance the next day.

And sometimes it's the same day. It becomes a cycle. Stress leads to scrolling, scrolling leads to less sleep, and less sleep leads to more stress, and our students begin to fail. Also, just identity and self-worth are a big issue. Instead of forming identity through real relationships, challenges, and growth, our students may begin to define themselves by likes, comments, and followers.

And this creates a fragile sense of worth that depends on external validation. When that validation drops, so does confidence. Especially during COVID we saw this being an incredible, incredible issue for our young students. And last, it reduces real-world connection, takes it down to nothing almost, because more time students spend online lets them have this face-to-face face engagement. So deep friendships, meaningful conversations, and interpersonal skills can really suffer.

Those college years are meant to build lifelong relationships, but social media can quietly replace presence with distraction. So there is an addiction here. I think a lot of adults are engaged as well, and I'm speaking maybe as behalf of a college president, but of course the, uh, any junior high, high school, and above ages. This is all within their realm. That's why I say, too, just to be fair, social media isn't all bad.

Of course, it can build communities, support causes, and help students stay connected. But without discipline, and maybe the help of SB 262, it can easily control more of a student's life than they realize. The goal here isn't just to eliminate it, but to set boundaries, limit screen time, prioritize real relationships, and focus on things that do make a serious difference. And in the end, I guess the question I want to ask the committee here and others: is social media bad? It's who's in control, really, you or the algorithm?

And so with that, in my experience as an educator for decades, I wish to bring support to SB 262. Thank you very much, Dr. Hamilton. Are there any questions from committee members? Seeing and hearing none, thank you again for joining us today and safe travels. Is there anyone else in the room— anyone else in the room or online who wishes to testify to this item?

Seeing and hearing none, we will close public testimony on Senate Bill 262. That brings the bill back before the committee. Do we have any further committee discussion, questions, or remarks?

Seeing and hearing none, I'll just make a few brief comments. This issue came to my attention because of folks like Mr. Dlifka and others. We've had some significant incidents in my school district, and I know many school districts around the state, with students having some very, very negative interactions that have spilled over into school because of things that have started on social media. Sometimes violent altercations and interactions that have led to threats of pretty, pretty intense violence at school, and then sometimes violence gets carried out. So it certainly is a desperate need that we take some action.

So I appreciate the committee's time today. If there is no further discussion or questions on the bill, what are the wishes of the committee? Thank you, Chair Bjorkman. I move to report committee substitute for Senate Bill 262 version 34-LS1286/i from committee with individual recommendations and the attached zero fiscal note. Is there any objection?

Seeing and hearing no objection, committee substitute for Senate Bill 262 version 34-LS1286 version i, as in indigo, is reported from committee with individual recommendations and attach zero fiscal note. We'll take a brief at ease while we sign the paperwork and set up for our next bill.

We're back on the record now. The time is 2:06 PM here in Belts Room 105. Our next item on the agenda today is Senate Bill 150, sponsored by the Senate Rules Committee at the request of the Governor. Today is the 4th hearing on this bill. During our first hearing we had a presentation of the bill, took invited testimony.

I would like to— I don't see a Kurz there here. However, we can— Mr. Jackson, would you like to provide a brief recap of the bill or I can do it from here? That's fine. Very good. No worries.

So we weren't quite sure if anyone was going to be here from the governor's office. We do have online Claire Knutson-Latta. She is a utility engineering analyst with RCA, as well as John Espendola, who is chair of the RCA, and Jess Manoos, utility engineering analyst with RCA, on the line for questions. To recap the bill for the public and folks in attendance here in the room, net metering essentially, this concept revolves around should there be a financial incentive for folks to have some type of electricity generation located on their property by which they can sell excess electricity that they don't use at their home back onto the grid at a rate that is equal to the rate that they pay for electrons that come from their utility delivered to their home. Essentially what the, what the bill has done.

We have a draft proposed committee substitute in members' packets for discussion today. May I have a motion, please? Yes, Chair Beyerkman. I move committee substitute for Senate Bill 150 version 34-GS1571/H as the working document. I'll object for purposes of explanation.

Here to explain the changes is Mr. Conrad Jackson.

Thank you, Mr. Chairman. For the record, Conrad Jackson, staff to Senator Bjorkman and the Labor and Commerce Committee. The proposed CS before members makes a few changes, and if you'll notice at the header of that, of that document, this summary of changes, we're starting from version A, the original version of the bill that came before the committee. We have a couple of different options before the members, but I want to make sure everybody is starting from the same document. So Mr. Chairman and members of the committee, first of course we have some changes to the title, just conforming with the other changes made in the bill.

The first change is found in Section 2(a)(1), is amending the calculation, the rate that is used to calculate credits for net metering for consumer generating customers. This change changes from retail power rate to a wholesale, an average wholesale power rate. The next change is found in A.2, and we're removing the March 31st expiration of credits, and instead we are allowing the credits to carry forward for 12 months from the date the credits are accrued. Following the 12 months, then they would expire.

Following that, Section B is deleted.

The next section is renumbered accordingly. The next change is the new B, I guess you would say, which is former C, is amended to remove the requirement that the RCA help— hold a hearing to determine that the limitation on consumer generation is necessary to protect the system reliability. This will help streamline the process instead of adding the burden of a hearing to the RCA.

The next change in that section is also made by deleting the term unjust and unreasonable and replacing it with undue discrimination. Following that, we insert a new Section C requiring a load-serving entity establish an alternate rate structure that reflects the entity's cost to provide electrical services. Uh, we are then deleting old Section D and replacing it with language which prohibits a load-serving entity from shifting cost from a consumer generator to those who do not generate power. Subsection E is amended to require the Commission adopt regulations avowing— pardon me— evaluating the new alternate rate structure found in C, which replaces the calculation of recoverable revenue losses as a factor of the Commission's regulatory determination. The next change is in F, subsection F in the definitions, and we replace the term utility, electric utility, with load-serving entity.

There are also conforming changes, drafting changes in that section. Section 3 of the former version, the previous version, version A, is deleted. This removes the net metering reimbursement fund. And the final change, Mr. Chairman, is an update to the effective date to January 1, 2026. Very good.

Thank you. Questions? Senator Dunbar. Thank you, Mr. Chair.

So is this— this is intended to be retroactive then?

I'm sorry, Senator Nembhard, I don't understand your question. Oh, the effective date of January 2026.

I believe that there was a, I think, a typo in the explanation of changes. Roger. The bill reads that the act takes effect July 1st, 2026. Okay, thank you. My apologies, Mr. Chairman.

No worries. Let me actually read the—.

Any further questions? Well, I have a question. Yes, Senator Dunbar. Is there going to be invited testimony on this, or should I direct questions about the S version to the committee chair or to Mr. Jackson? We had not planned for invited testimony.

Testimony today. Okay. So one of the— one of the biggest concerns I've heard from utilities about the underlying bill is this issue of cost shifting, essentially. Is the feeling that this S version resolves that concern?

Yes, Senator Dunbar. Yes, that is the intent of this, is to eliminate cross-subsidization of essentially the utility itself paying members the same retail rate for electrons that they create on their own as they would pay a much higher rate for that power than they would power generated through another generation source. Roger. I think I might have said the S version, which is the term we use on the assembly for committee substitute. So I'll say committee substitute, the H version.

Yes, sir. Thank you. Thank you, Mr. Chair. That makes good sense to me.

Mr. Chairman, if I might add to that, through the chair, Senator Dunbar, if you'll see in the new Section D, we are specifically prohibiting a load-serving entity safety from shifting costs from the consumer generators to those who do not generate power.

Great.

Any further questions or discussion?

Senator Dubar. Oh, no, I'm just wondering, did you object for discussion? I did. Okay. Yep.

Yep. And just by way of discussion, you touched on it there.

The goal of this CS was to eliminate cross-subsidization so that people who do not have solar panels, they don't have wind generation, they don't have a micro hydro, what have you, a thermal nuclear plant, whatever they are doing to generate electrons, that they are not selling power to their neighbors at a higher rate than the average wholesale cost of what the rest of the members of the utility buy power from. So that's, that's really the goal. This bill allows for annual net metering to take place. So that means that if someone has power generation from solar panels at their home, and they're generating excess excess power, those credits from those electrons that they generate, they can be carried over on an annual basis until they use up the credits. And so that's how this is designed to work, simply not having the utility pay more for those electrons than they would the average wholesale cost.

Any further questions?

Hearing and seeing none at this time, I will remove my objection. Is there further objection? Hearing no objection, committee substitute for Senate Bill 150 version 34-GS1571/h, as in huslia, is before us as the working document. Senator Dunbar. Mr.

Chair, can I have a brief at ease? Brief at ease.

Back on the record. This time we will set Senate Bill 150 aside for further consideration at a future meeting. The Senate Labor and Commerce Committee will meet again on Monday, May 4th, when we will hear H.R. 38, Public Safety Telecommunicators; Senate Bill 234, Uniform Fiduciary Income and Principal Act. House Bill 126, reinstatement of Native corporations, religious corporations.

House Bill 249, transfer of vehicle title to the insurer. And Senate Bill 207, property possession and property crimes. As there is no further business to come before the committee today, we are adjourned at 2:18 PM.