Legislature(2003 - 2004)
05/01/2003 08:06 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 157-ELIMINATE APOC CHAIR WEYHRAUCH announced that the final order of business was HOUSE BILL NO. 157, "An Act eliminating the Alaska Public Offices Commission; transferring campaign, public official, and lobbying financial disclosure record-keeping duties to the division of elections; relating to reports, summaries, and documents regarding campaign, public official, and lobbying financial disclosure; providing for enforcement by the Department of Law; making conforming statutory amendments; and providing for an effective date." CHAIR WEYHRAUCH turned to the short title of HB 157, "Eliminate APOC", which he viewed as a misnomer because this legislation doesn't eliminate the Alaska Public Offices Commission (APOC). Chair Weyhrauch announced that he wanted to limit public testimony at this hearing, which he said would be a work session on a large number of amendments that will result in a committee substitute (CS). After a CS is [drafted], the committee will review the CS before reporting it from committee. Number 0820 STEVE CONN, Alaska Public Interest Research Group (AkPIRG), said that he wanted to connect HB 157 to the proposed statewide sales tax. He highlighted that the legislature passed the campaign finance law after 80 percent of the public said, if polled they would pass an initiative on campaign finance reform. Much of HB 157 deals with amendments to the campaign finance law. These are amendments that loosen restrictions on lobbyist contributions outside their district and substantially raise the contribution limit. Given the debate and issues that will be driven by the proposed statewide sale tax related to who receives exemptions, this isn't a time to present an impression to the public that money drives political decision-making in the legislative process. This is a time when the public is very concerned with regard to the role of lobbyists and the lobbyist's role to drive a message. Mr. Conn pointed out that the work on HB 157 will now be read against the concerns held by the elders on the longevity bonus and the statewide sales tax. Mr. Conn concluded by informing the committee he is retired from AkPIRG and the University of Alaska and is a member of the AARP, and a resident of Seward. He noted that that city will have a lot of concern with regard to the statewide sales tax. CHAIR WEYHRAUCH reminded the committee that before it is CSHB 157, Version HB 157.doc, 4/24/2003. He explained that the amendments have been organized such that they will be taken in order of the section impacted. REPRESENTATIVE GRUENBERG announced that he wanted to hold Amendments 1 and 1-A. REPRESENTATIVE BERKOWITZ pointed out that his Amendment 1-B, which would eliminate Section 1, is the most universal approach and if it passes, it would eliminate the need for Amendments 1 and 1-A. REPRESENTATIVE BERKOWITZ moved that the committee adopt Amendment 1-B, which read as follows: Page 1, lines 7 - 9: Delete "amending the campaign finance and public official financial disclosure laws to allow municipalities to choose whether they apply to municipal elections and municipal officials;" Page 2, lines 1 - 21: Delete all material. Page 2, line 22: Delete "Sec. 2" Insert "Section 1" Renumber the following bill sections accordingly. Page 22, lines 6 - 19: Delete all material. Renumber the following bill sections accordingly. Page 22, line 24: Delete "sec. 20" Insert "sec. 19" Page 22, line 29: Delete "sec. 37" Insert "sec. 34" Page 23, line 5: Delete "sec. 20" Insert "sec. 19" Page 23, line 6: Delete "sec. 34" Insert "sec. 31" Page 23, line 8: Delete "Section 36" Insert "Section 33" Page 23, line 9: Delete "sec. 38" Insert "sec. 35" [Not on tape, but reconstructed from the committee secretary's log notes, was Representative Dahlstrom's objection to Amendment 1-B.] TAPE 03-48, SIDE A REPRESENTATIVE BERKOWITZ, in response to Representative Dahlstrom's objection, explained that he is offering Amendment 1-B because "we" don't know the consequences if the format of the system is changed. He noted that everyone at this table lives in an area that has "opted in," although there are areas in the state that have not. The cost shifted to the municipality will come at a time when there is declining state support for municipal revenues. He characterized this as a pass through to the taxpayers of the communities that "opt in". Furthermore, this adds cost due to the election and the establishment of local interface with APOC. Moreover, there is no knowledge with regard to the result if communities that are currently in move out. Therefore, this will result in a patchwork quilt of different approaches to APOC. As the system currently exists, there is a lot of benefit to having uniformity in the local and state elections and [this legislation] runs the risk of using that uniformity. With regard to the fees that municipalities would be required to pay under this legislation, he related his experience with fee creep in which the fee far exceeds the cost and becomes a profit center for the state. Therefore, he suggested keeping the state paying its share and maintain as small a bureaucracy as possible. Number 0245 REPRESENTATIVE HOLM referred to the document provided by Ms. Miles entitled, "Municipality Status Under Campaign Disclosure & Public Official Financial Disclosure Laws." He inquired as to what this document relates. He also inquired as to the meaning of "Exempt" in the Public Official Financial Disclosure column. Number 0465 BROOKE MILES, Executive Director, Alaska Public Offices Commission, Department of Administration, explained that the exempt designation is because the voters in the community listed voted to exempt themselves from AS 39.50. In further response to Representative Holm, Ms. Miles explained that under the Campaign Disclosure column the term "Required" means that the community hasn't exempted itself as permitted under the statute. The term "Opted Out" means that the community has exempted itself as permitted by the statute. If the Campaign Disclosure column is blank it's because the community's population is less than 1,000 citizens and thus isn't required to be subject to the law. REPRESENTATIVE HOLM related his understanding of Ms. Miles' memorandum that the total cost for all of these municipalities was under $100,000, specifically $61,760. He recalled that APOC's budget is $753,000 and thus the $61,760 is a small portion of APOC's budget. MS. MILES said it would seem to be. However, she pointed out that APOC doesn't have staff that is dedicated only to working with municipalities. The APOC staff works with municipalities and the state with both financial and campaign disclosures. The lobbying law only applies to the state. Therefore, it was difficult to determine the funds required to service municipalities. She explained that the $61,760 came from the percentage of personal services time on the staff working on those laws. However, those costs don't include when a complaint is filed at the municipal level. She pointed out that complaints are filed under both financial disclosure law and the campaign disclosure law and those add to APOC's costs, particularly if an Administrative Procedures Act hearing is required. Ms. Miles apologized for not being able to present a more solid number. Number 0140 REPRESENTATIVE HOLM explained that he was thinking in terms of shifting the cost back to the municipalities, if they choose to not exempt their personnel elected. Because of the aforementioned, he objects to Amendment 1-B. If this rewrite is to occur, then [the language being deleted by Amendment 1-B] should remain in the legislation. CHAIR WEYHRAUCH directed his comments to Representative Berkowitz and said that he understands that currently a municipality has to opt in to this, which would result in a fee. However, he understood Representative Berkowitz to explain that a municipality would have to pay a fee and in these times of taking money away, there isn't the desire to do that. Therefore, he thought that [Amendment 1-B] met the above concern by meaning that the municipality would be out unless it opted in, at which time the municipality would pay the fee. REPRESENTATIVE BERKOWITZ explained that many entities are in [the state system] now and [with this legislation] he questioned whether those entities will be out and have to "pursue a question," which means that there would be hearings at the local level, attorney time, and a potential election, resulting at some point in someone being tasked with interfacing with APOC. Therefore, there would be costs as well as unanticipated consequences associated with changing the status quo. Representative Berkowitz said upsetting the infrastructure for relatively small amounts of money with uncertain benefits doesn't seem to be a risk worth taking at this point. However, if the costs are far greater than the $61,760, then this is simply a "pass-along" to local communities. Representative Berkowitz said: If we want to systematically look at services the state provides that we think the municipality ought to provide, then let's do that. But, if we're doing this on an ad hoc basis, that raises all kinds of problems. I think there are real efficiencies that are gained across the state and the overall cost to the citizens of the state are reduced when the state provides these services rather than requiring each community to provide those services. There are economies of scale that will not be met if we require municipalities to pick up these services, and there's also efficiencies that we lose by requiring these municipalities that have already asked the question [and] already given an answer to re-ask those questions. CHAIR WEYHRAUCH asked if, under Version HB 157.doc, 4/24/2003, those communities that have already opted in will be kicked out and have to opt in again through a new election. MS. MILES replied no. She related her understanding that under the current version of the bill, those municipalities that have already opted in would now be required by election to opt in. Perhaps, one could view this to mean that everyone already in is considered in and thus discussion of the fee could occur, or the municipality could opt out. REPRESENTATIVE GRUENBERG said that Amendment 1 would accomplish what Ms. Miles presented above. Number 1060 REPRESENTATIVE SEATON commented that he doesn't see that it's necessary to go through all this change. There is a system in which many cities have opted in. With the elimination of [Section 1], then all the municipalities that have opted in will continue to receive the services they already receive and will be in APOC and provide reports. He surmised that [this legislation] eliminates a change and the system will stay the same. MS. MILES responded that such would be the case if the committee adopts Amendment 1-B. REPRESENTATIVE GRUENBERG pointed out that there are two issues that need to be reviewed separately. The first issue is whether the intent is to impose a fee on the municipalities. If there is no desire to impose a fee on the municipalities, then Amendment 1-B should be adopted because it retains the status quo. If the desire is to impose a fee on the municipalities, the question becomes whether the municipalities should have to opt out or opt in. If the decision is to have the municipalities opt out and impose the fee, then Amendment 1-B should be adopted. If the decision is to have the municipalities opt in and impose the fee, then he suggested rejecting everything, leaving Section 1 as it is currently written. Number 1182 REPRESENTATIVE BERKOWITZ inquired as to what would happen to pending issues related to municipal elections if the legislation passed "as is." MS. MILES answered that pending issues would go through their normal course of business, under the authority of the law under which the issues began. REPRESENTATIVE SEATON related his belief that the fee structure is probably one of the basic parts of revenue sharing that there is. He further related his belief that the current system seems to work well for the municipalities and APOC. Therefore, he viewed [the legislation] as a "funny way" to recoup a small amount of money from municipalities. He announced his support of the amendment to retain the system as it exists. CHAIR WEYHRAUCH reminded the committee that the motion to adopt Amendment 1-B is pending. A roll call vote was taken. Representatives Seaton, Dahlstrom, Lynn, Berkowitz, Gruenberg, and Holm voted in favor of Amendment 1-B. Representative Weyhrauch voted against it. Therefore, Amendment 1-B was adopted by a vote of 6-1. [HB 157 was held over.]
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