04/03/2018 03:15 PM House STATE AFFAIRS

          HB 407-APOC; CAMPAIGN CONTRIBUTIONS/REPORTING                                                                     
                                                                                                                                
4:40:57 PM                                                                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS  announced that  the next order  of business                                                               
would be  HOUSE BILL NO. 407,  "An Act relating to  the duties of                                                               
the Alaska  Public Offices Commission;  clarifying the  limits on                                                               
making,   accepting,   and   reporting  certain   cash   campaign                                                               
contributions; relating to campaign  finance reporting by certain                                                               
groups;  relating  to  the  identification  of  certain  campaign                                                               
communications;  increasing the  time the  Alaska Public  Offices                                                               
Commission has to  respond to a request for  an advisory opinion;                                                               
repealing  a  reporting  requirement for  certain  contributions;                                                               
relating to propositions and  initiative proposals; and providing                                                               
for an effective date."                                                                                                         
                                                                                                                                
4:40:30 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KREISS-TOMKINS  related that this was  a committee                                                               
bill  that was  previously  discussed.   He  asked  his staff  to                                                               
present an  overview of the bill.   He reminded members  that the                                                               
bill contained  statute changes resulting from  the House Finance                                                               
Subcommittee process.                                                                                                           
                                                                                                                                
4:40:44 PM                                                                                                                    
                                                                                                                                
CATHY  SCHLINGHEYDE,   Staff,  Representative   Jonathan  Kreiss-                                                               
Tomkins,  Alaska  State  Legislature, reiterated  that  the  bill                                                               
contained  recommendations by  the  Department of  Administration                                                               
Finance subcommittee.                                                                                                           
                                                                                                                                
MS. SCHLINGHEYDE  paraphrased the  sponsor statement for  HB 407,                                                               
which read as follows [original punctuation provided]:                                                                          
                                                                                                                                
     The Alaska Public Offices Commission  (APOC) has seen a                                                                    
     42.4% reduction in UGF since  the FY15 management plan,                                                                    
     resulting in  the loss of  six positions. HB  407 would                                                                    
     streamline  reporting  requirements  to allow  APOC  to                                                                    
     operate more  efficiently within the  current budgetary                                                                    
     restraints.                                                                                                                
                                                                                                                                
     HB  407 increases  APOC efficiency  by also  easing the                                                                    
     auditing  requirements,   allowing  APOC   to  exercise                                                                    
     discretion  when  reviewing   reports  and  statements,                                                                    
     eliminating  duplicative reporting,  extending response                                                                    
     times  for  advisory   opinions,  and  extending  small                                                                    
     campaign reporting exemptions to groups.                                                                                   
                                                                                                                                
     In  addition  to  the  streamlining  measures,  HB  407                                                                    
     provides   needed  clarification   by  specifying   the                                                                    
     requirements   of   "paid   for"  lines   on   campaign                                                                    
     communications and  defining a  calendar year  for cash                                                                    
     contribution limits.                                                                                                       
                                                                                                                                
     APOC provides an important  public service ensuring the                                                                    
     enforcement  of campaign  finance ethics  requirements.                                                                    
     HB  407  allows APOC  to  complete  their mission  more                                                                    
     efficiently and cost effectively.                                                                                          
                                                                                                                                
4:40:58 PM                                                                                                                    
                                                                                                                                
MS. SCHLINGHEYDE reviewed the  section-by-section analysis for HB
,  titled "HB  407 -  APOC; Campaign  Contributions/Reporting,                                                               
Sectional Analysis,  which read as follows  [original punctuation                                                               
provided]:                                                                                                                      
                                                                                                                                
     Section  1:  This  section eases  the  report  auditing                                                                    
     requirements  by removing  the word   all.  The  change                                                                    
     allows  APOC   to  strategically  select   reports  and                                                                    
     statements to audit.                                                                                                       
                                                                                                                                
     Section 2:  This section inserts   calendar  to clarify                                                                    
     confusion  on  the definition  of  year  in regards  to                                                                    
     reporting contributions.                                                                                                   
                                                                                                                                
     Section  3:  This  section extends  the small  campaign                                                                    
     reporting  exemptions   to   groups   in   addition  to                                                                    
     individuals.  The  minimum   threshold  for  groups  to                                                                    
     report  would  be  raising or  expending  $2,500  in  a                                                                    
     calendar year.                                                                                                             
                                                                                                                                
     Section  4:   This  section  renumbers the  statute  to                                                                    
     accommodate the changes in Section 3.                                                                                      
                                                                                                                                
     Section 5:  This section inserts   calendar  to clarify                                                                    
     confusion on the  definition of year in  regards to the                                                                    
     cap on candidate's acceptance cash contributions.                                                                          
                                                                                                                                
     Section 6:  This section inserts   calendar  to clarify                                                                    
     confusion on the  definition of year in  regards to the                                                                    
     cap on donating cash contributions.                                                                                        
                                                                                                                                
     Section 7:  This section provides standardized rules to                                                                    
     ensure the readability of  paid  for  lines in campaign                                                                    
     communications.                                                                                                            
                                                                                                                                
     Section 8:  This section extends by three days the time                                                                    
     allowed for APOC to provide an advisory opinion.                                                                           
                                                                                                                                
     Section  9:     This  section   eliminates  duplicative                                                                    
     reporting  of contributions  to  ballot initiatives  by                                                                    
     removing  the requirement  that  donors self-report  in                                                                    
     addition to the campaign's report.                                                                                         
                                                                                                                                
     Section  10:  This section  sets an  effective  date of                                                                    
     January 1,  2019, after the  conclusion of  the current                                                                    
     election cycle.                                                                                                            
                                                                                                                                
4:41:00 PM                                                                                                                    
                                                                                                                                
MS. SCHLINGHEYDE  said that  Section 1  allowed the  APOC to                                                                    
have the  discretion in report  auditing to  review specific                                                                    
documents,   not   necessarily   every  document   that   is                                                                    
submitted.    Sections 2,  5,  and  6  all insert  the  word                                                                    
calendar to clarify  the definition of year,  which has been                                                                    
disputed.  Section 3, small  campaigns for individuals, have                                                                    
a  minimum reporting  threshold  and this  allows groups  to                                                                    
have a  minimum reporting  threshold as  well.   The minimum                                                                    
threshold  for   groups  to  report  would   be  raising  or                                                                    
expending $2,500 in a calendar year.                                                                                            
                                                                                                                                
4:41:25 PM                                                                                                                    
                                                                                                                                
MS.  SCHLINGHEYDE  related  that  Section  4  was  statutory                                                                    
cleanup  to  renumber  based  on   Section  3.    Section  7                                                                    
specified the  requirement for  paid for   lines in campaign                                                                    
communications.   Section 8 would  extend by three  days the                                                                    
time allowed  for APOC to  issue an advisory opinion  due to                                                                    
their decreased staffing capacity.                                                                                              
                                                                                                                                
MS. SCHLINGHEYDE  related that Section 9  states that ballot                                                                    
initiative donors do not have  to submit duplicative reports                                                                    
when   the   campaigns    were   already   reporting   those                                                                    
contributions, which  means APOC only needs  to process them                                                                    
once and not twice.  Section  10 would set an effective date                                                                    
of  January 1,  2019, after  the conclusion  of the  current                                                                    
election cycle.                                                                                                                 
                                                                                                                                
4:42:00 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK  asked for  further clarification  on Section                                                               
9.                                                                                                                              
                                                                                                                                
MS.  SCHLINGHEYDE  responded  that for  ballot  initiatives,  the                                                               
campaign must  report donors who contribute  above $500; however,                                                               
the donors must also  fill out a form, form 15-5,  and if they do                                                               
not the donors are subject to  fines.  Concern has been expressed                                                               
that APOC must process the  reporting twice and must "track down"                                                               
people who are not aware of  the reporting requirement.  She said                                                               
this  tended  to  create  excess  paperwork  with  no  additional                                                               
reports.                                                                                                                        
                                                                                                                                
4:42:45 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK  expressed concern  on  how  one would  know                                                               
someone was  reporting unless it was  checked on both sides.   He                                                               
also had the same concern that  donors might not know the need to                                                               
do so.   He suggested that  perhaps there should be  a disclosure                                                               
printed on the donation envelopes, so people would be informed.                                                                 
                                                                                                                                
MS.  SCHLINGHEYDE  clarified that  this  only  applied to  ballot                                                               
initiatives and not to other campaign donations.                                                                                
                                                                                                                                
4:43:32 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  LEDOUX recalled  that years  ago both  candidates                                                               
and donors had to report; however,  most donors did not know they                                                               
needed to report  these donations, so it  was ultimately changed.                                                               
She  offered her  belief that  this was  in keeping  with regular                                                               
political campaigns.  In fact, she  was surprised it had not been                                                               
changed already.   In response  to Representative  Tuck's earlier                                                               
concern, she  stated that the  same logic would apply  to regular                                                               
political campaigns.                                                                                                            
                                                                                                                                
REPRESENTATIVE TUCK  agreed but  otherwise it was  by faith.   He                                                               
offered his  belief that the reason  for a public process  was to                                                               
provide transparency.                                                                                                           
                                                                                                                                
4:44:46 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE BIRCH  offered he  had personal experience  with a                                                               
contributor to a campaign in  which the donation was reported and                                                               
the contributor did  not report separately.   The information was                                                               
complete, but  it was  not reported  in duplicate,  he said.   He                                                               
offered his belief that it was reasonable to update this.                                                                       
                                                                                                                                
4:45:12 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KNOPP  referred to  Section 8.   He said  it would                                                               
not necessarily  extend by three  days the advisory opinion.   He                                                               
offered his belief that it would  double the time by changing the                                                               
language from  7 days to  10 business days would  actually amount                                                               
to 14 total  days.  He asked for further  clarification as to the                                                               
reasonableness of the  length of time and how  time sensitive the                                                               
opinion would be.                                                                                                               
                                                                                                                                
4:46:05 PM                                                                                                                    
                                                                                                                                
HEATHER  HEBDON,   Executive  Director,  Alaska   Public  Offices                                                               
Commission (APOC),  Department of Administration,  responded that                                                               
was  correct.   She said  this would  extend the  requirement for                                                               
issuing draft  advisory opinions  by allowing an  additional five                                                               
days.   While the  APOC understood  it could  be critical  to the                                                               
requestor,  it  would reduce  unnecessary  overtime  at the  APOC                                                               
office.  She pointed out that  the APOC drafts were also reviewed                                                               
by the Department of Law (DOL)  prior to issuance.  She said this                                                               
change would allow APOC to reduce overtime costs.                                                                               
                                                                                                                                
4:46:56 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KNOPP  asked for further clarification  on whether                                                               
it  would  be  critical  from the  individual  or  organization's                                                               
perspective that requests  an advisory opinion and if  any of the                                                               
advisory opinions would be time-sensitive.                                                                                      
                                                                                                                                
MS.  HEBDON answered  that  it was  difficult  to answer  without                                                               
specific  facts.    She  said   that  APOC  receives  simple  and                                                               
straight-forward  questions.     The   majority  of   times,  the                                                               
requestor has already  contacted staff and has a  general idea of                                                               
which direction  the agency was  going.  This would  formalize it                                                               
and get APOC's approval.                                                                                                        
                                                                                                                                
4:47:56 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KNOPP  asked whether  it was fair  to say  that if                                                               
APOC realized some  urgency in the advisory opinion,  it would be                                                               
prioritized.                                                                                                                    
                                                                                                                                
MS.  HEBDON  answered  absolutely;  that just  because  the  bill                                                               
extended the time to 10 days  would not mean the commission could                                                               
not complete  the advisory  opinion and have  it reviewed  by DOL                                                               
sooner.                                                                                                                         
                                                                                                                                
4:48:43 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK referred to Section  3 but decided he did not                                                               
have a question.                                                                                                                
                                                                                                                                
4:49:00 PM                                                                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS announced HB 407 would be held over.