Legislature(2001 - 2002)
05/13/2002 09:10 AM RLS
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SB 363-CAMPAIGN FINANCE PROVISIONS CHAIR KOTT announced that the next order of business would be CS FOR SENATE BILL NO. 363(STA) am, "An Act relating to communications and elections, to reporting of contributions and expenditures, and to campaign misconduct in the second degree; relating to disclosure by individuals of contributions to candidates; and providing for an effective date." Number 1073 REPRESENTATIVE PORTER moved to adopt 22-LS1713\B, Kurtz, 5/12/02, as the working document. There being no objection, Version B was before the committee. SENATOR GENE THERRIAULT, Alaska State Legislature, testified as the sponsor of SB 363. He pointed out the changes encompassed in Version B as follows. On page 4, line 29, "automatic telemarketer" was deleted because of concern that parties using automatic dialers to call people to urge them to vote could be construed as part of party activity. On page 5, lines 7-8, the window for electioneering communications was reduced to "30 days preceding a general or municipal election". On page 5, lines 9- 10, the definition of "express communication" was tightened in order to reflect the traditional interpretation of Buckley v. Valeo. The Buckley [case] requires that communication be clearly advocated for the election or defeat of the candidates with the specific words "vote for" or "vote against" being used. SENATOR THERRIAULT pointed out that the majority of the bill deals with eliminating the "15:5 form." As the campaign financing laws have been modified over the last couple of years such that the individual maximum contribution is $500, then the 15:5 form doesn't have to be filed until the $500 maximum is reached. After talking with the Alaska Public Offices Commission (APOC), he understood that the 15:5 form had been regulated such that it was meaningless paperwork. He pointed out that language was included such that the 15:5 form would be required on ballot propositions otherwise the first indication as to where the money for a ballot proposition originated would be 30 days before the election. The APOC is happy to do away with the 15:5 form. Number 1312 REPRESENTATIVE BERKOWITZ related his understanding that under the old reporting rules, reports go out for contributions and expenditures to candidates or groups. However, the new reporting rules don't seem to be as stringent. He asked if the new reporting rules require disclosure of contributions to anything other than a group organized with the principle purpose of influencing the outcome of a proposition. Number 1366 JOE BALASH, Staff to Senator Gene Therriault, Alaska State Legislature, explained that the [remaining portions of] AS 15.13.040 maintains the reporting requirements for parties, groups, and candidates. In the 30-, 10-, and 7-day reports before elections, all parties, groups, and candidates will be required to disclose the origin of the money received. In further response to Representative Berkowitz, Mr. Balash confirmed that [a candidate's] expenditures and groups organized with the principle purpose of influencing the outcome of a proposition are covered by the aforementioned [reporting] requirements. Number 1429 BROOKE MILES, Director, Alaska Public Offices Commission, Department of Administration, informed the committee that the 15:5 form required for contributors has been a component of the campaign disclosure law since its inception in 1974. Originally, those giving more than $250 to a candidate or group were required to file form 15:5. Changes connected with campaign finance reform required that contributors would only file [the 15:5 form] upon giving $500 and the time period was expanded to allow the filing to occur [within] 30 days [of the contribution]. Then legislation enacted early this year required that [the 15:5 form] would also be filed by the candidate. Ms. Miles said that the 15:5 form is no longer a useful audit tool. Furthermore, it is more paperwork for the candidate who is already files 30-day and 7-day reports for each contributor that gives more than $100. When the change was made that allowed the candidate to file on behalf of the contributor, APOC discussed that since 1997 there has been a moratorium on accessing civil penalties for a 15:5 form that was admitted after the due date. The commission informed staff that after the effective date of the legislation, April 16th, APOC would access civil penalties. That change was of concern for candidates. Number 1570 REPRESENTATIVE BERKOWITZ referred to Section 1 of Version B, which addresses AS 15.13.040(d). He related his understanding that reporting contributions to candidates are included in the current statute, but aren't included in the bill. Furthermore, Section 3 seems to say that expenditures for billboard signs or printed materials aren't required to be reported. MS. MILES explained that Section 3 is the result of the McIntyre (ph) case in the U.S. Supreme Court. This requires that those spending less than $250 to print something wouldn't be subject to the law when related to a ballot proposition. REPRESENTATIVE BERKOWITZ noted that the McIntyre (ph) case isn't part of the backup in the committee packet. Representative Berkowitz related his understanding that the U.S. Supreme Court says that one can have unlimited expenditures for billboards, signs, or printed materials concerning a ballot proposition without reporting it. MS. MILES said, "Without being subject to the campaign disclosure law, that's correct." The only change from current law is the change in the citation from (d)(2) to (d). MR. BALASH clarified that the billboards, signs, and printed materials are part two of the test while part one of the test is the restriction of not exceeding a cumulative total of more than $250 during the calendar year. REPRESENTATIVE BERKOWITZ returned to [Section 1] subsection (d). MR. BALASH specified that the contributor is no longer required to file a report, but contributions to candidates will still be reported by the candidates. CHAIR KOTT, determining there was no further public testimony, closed the public testimony. Number 1727 REPRESENTATIVE BERKOWITZ recalled that the House Judiciary Standing Committee expressly wanted to include telephonic telecommunications, which has been dropped in Version B. Therefore, he moved the following conceptual amendment [Amendment 1] that would restore the language ["automatic telemarketing"] on page 4, line 29, in Version 22-LS1713\P. MR. BALASH recalled that in last year's Singleton decision there were some inferences made with regard to what parties can and cannot do in terms of their expenditures. There is the implication that party-building activities are off-limits from regulation. The automatic telemarketing with which he is most familiar is when one party turns to its members and encourages them to vote on election day. The same could apply to a union communicating to its members. Mr. Balash pointed out that "automatic telemarketing" was in the middle of a list of communications, he didn't believe that the severability clause would allow the rest of the language stand. REPRESENTATIVE BERKOWITZ said that the aforementioned arguments also hold true for all the other forms of communication listed. MR. BALASH pointed out that automatic telemarketing picks out specific recipients of the message being communicated. REPRESENTATIVE BERKOWITZ interjected that the same is true of direct mail. MR. BALASH agreed, and related his belief that the term "direct mail" wasn't used. REPRESENTATIVE BERKOWITZ said that automatic telemarketing seems to fit in the list of communications. CHAIR KOTT restated Amendment 1: page 4, line 29, after "Internet," insert "automatic telemarketing". There being no objection, Amendment 1 was adopted. Number 1956 REPRESENTATIVE BERKOWITZ turned to the following amendment: Page 1, line 2: Delete "and" Following "degree": Insert ", and to repayment of prohibited contributions" Page 1, line 5, through page 6, line 11: Delete all material and insert: "* Section 1. AS 15.13.090, as amended by secs. 18 and 19, ch. 1, SLA 2002, is amended to read: Sec. 15.13.090. Identification of communication and disclosure of source of funds. (a) All advertisements, billboards, handbills, paid-for television and radio announcements, electioneering communications, and other communications intended to influence the election of a candidate or outcome of a ballot proposition or question shall be clearly identified by the words "paid for by" followed by the name and address of the candidate, group, nongroup entity, or individual paying for the communication [ADVERTISING]. In addition, candidates and groups must identify the name of their campaign chairperson. (b) The provisions of (a) of this section do not apply when the communication [ADVERTISEMENT] (1) is paid for by an individual acting independently of any group or nongroup entity and independently of any other individual; (2) is made to influence the outcome of a ballot proposition as that term is defined by AS 15.13.065(c); and (3) is made for (A) a billboard or sign; or (B) printed material other than an advertisement made in a newspaper or other periodical. * Sec. 2. AS 15.13.090 is amended by adding a new subsection to read: (c) A person making a communication subject to (a) of this section shall report to the commission the source of funds used to pay for the communication according to the schedule specified in AS 15.13.110(a). If the communication is made within nine days of an election, the source of funds used to pay for the communication shall be reported to the commission within 24 hours after the communication. * Sec. 3. AS 15.13 is amended by adding a new section to read: Sec. 15.13.382. Repayment of prohibited contributions. A person receiving a contribution any portion of which was made in violation of the provisions of this chapter shall return the full contribution to the contributor. * Sec. 4. AS 15.13.390(a) is amended to read: (a) A person who fails to register when required by AS 15.13.050(a) or who fails to file a properly completed and certified report within the time required by AS 15.13.040(d) - (f), 15.13.060(b) - (d), [15.13.080(c),] 15.13.110(a)(1), (3), or (4), (e), or (f) is subject to a civil penalty of not more than $50 a day for each day the delinquency continues as determined by the commission subject to right of appeal to the superior court. A person who fails to file a properly completed and certified report within the time required by AS 15.13.110(a)(2) or 15.13.110(b) is subject to a civil penalty of not more than $500 a day for each day the delinquency continues as determined by the commission subject to right of appeal to the superior court. A person who violates a provision of this chapter, except a provision requiring registration or filing of a report within a time required as otherwise specified in this section, is subject to a civil penalty of not more than $50 a day for each day the violation continues as determined by the commission, subject to right of appeal to the superior court. An affidavit stating facts in mitigation may be submitted to the commission by a person against whom a civil penalty is assessed. However, the imposition of the penalties prescribed in this section or in AS 15.13.380 does not excuse that person from registering or filing reports required by this chapter. * Sec. 5. AS 15.13.400, as amended by ch. 1, SLA 2002, is amended by adding a new paragraph to read: (13) "electioneering communication" means a communication that (A) is made within the 30 days preceding a primary election or the 60 days preceding a general election; (B) is made by way of direct mail, newspaper, Internet, broadcast, cable, or satellite media, telephone poll, or organized series of calls to an audience that includes voters who will have the opportunity to vote on a candidate clearly identified in the communication or on a candidate of a party clearly identified in the communication; and (C) when read as a whole and with limited reference to external events, is susceptible of no other reasonable interpretation but as an exhortation to vote for or against a specific candidate in the general or primary election. * Sec. 6. AS 15.56.014(a) is amended to read: (a) A person commits the crime of campaign misconduct in the second degree if the person (1) knowingly circulates or has written, printed, or circulated a letter, circular, or publication relating to an election, to a candidate at an election, or to an election proposition or question without the name and address of the author appearing on its face; (2) except as provided by AS 15.13.090(b), knowingly prints or publishes an advertisement, billboard, placard, poster, handbill, paid-for television or radio announcement, electioneering communication as that term is defined in AS 15.13.400, or other communication intended to influence the election of a candidate or outcome of a ballot proposition or question without the words "paid for by" followed by the name and address of the candidate, group, or individual paying for the advertising or communication and, if a candidate or group, with the name of the campaign chair; (3) knowingly writes or prints and circulates, or has written, printed, and circulated, a letter, circular, bill, placard, poster, or advertisement in a newspaper, on radio, or on television (A) containing false factual information relating to a candidate for an election; (B) that the person knows to be false; and (C) that would provoke a reasonable person under the circumstances to a breach of the peace or that a reasonable person would construe as damaging to the candidate's reputation for honesty or [,] integrity, or to the candidate's qualifications to serve if elected to office." Renumber the following bill sections accordingly. He explained that Section 1 in the amendment requires that all fund sources be disclosed and adds "electioneering communications". REPRESENTATIVE PORTER inquired as to why "electioneering communications" was added. REPRESENTATIVE BERKOWITZ pointed out that it works in conjunction with the definition of "electioneering communications" in the amendment, which is found in Section 5 of the amendment. REPRESENTATIVE PORTER noted, "But the bill changes those 30 and 60 days to 30 days." REPRESENTATIVE BERKOWITZ agreed, but explained that "it specifies not the intent of the person taking out the advertisement but the consequence of the advertisement." Representative Berkowitz pointed out that the language in Section 5(C) of the amendment has been tested in the courts and found to be acceptable. The language of the amendment doesn't require an intent component in order to find that an electioneering communication has occurred, which Version B seems to do. REPRESENTATIVE PORTER remarked that this is something that should've been addressed in the House Judiciary Standing Committee. He related his view that the language is restrictive to the point that there will "nine out of ten ways to get around it rather than one way to nail it down." Therefore, Representative Porter objected. SENATOR THERRIAULT pointed out that the amendment would require a title change. Senator Therriault related that Version B narrows the scope and takes into consideration court cases and attempts to make the bill as defensible as possible. Therefore, he preferred staying with Version B. REPRESENTATIVE BERKOWITZ commented that he would like to see some of the changes accommodated [because] time is running out. REPRESENTATIVE PORTER maintained his objection to Amendment 2. A roll call vote was taken. Representatives Berkowitz and Joule voted for the adoption of Amendment 2. Representatives Porter, Kohring, Morgan, McGuire, and Kott voted against the adoption of Amendment 2. Therefore, Amendment 2 failed by a vote of 2-5. Number 2195 REPRESENTATIVE PORTER moved to report HCS CSSB 363, Version 22- LS1713\B, Kurtz, 5/12/02, as amended out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HCS CSSB 363(RLS) was reported from the House Rules Standing Committee.