Legislature(2001 - 2002)
05/04/2002 01:35 PM Senate STA
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* first hearing in first committee of referral
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SB 363-CAMPAIGN FINANCE PROVISIONS
CHAIRMAN THERRIAULT noted there was a new proposed CS, version L.
MR. JOE BALASH, Aide to the Senate State Affairs Committee,
outlined the following changes in the CS:
· The former Section 1 regarding the "paid for by" statement
was removed.
· Testimony from Ms. Brooke Miles of the Alaska Public Offices
Commission (APOC) suggested that the 15-5 reporting burden
on contributors might be unnecessary so Sec. 9 repealed that
requirement. Sections 1, 2, 3, 4, and 5 of the CS conformed
to that by removing "contribution and" from contribution and
expense expenditure reporting requirements.
· It was decided that defining communications that could and
could not be regulated in the definitions section and making
them part of the definition of an expenditure would
accomplish the intent of SB 363. If something were defined
as an expenditure, it would be subject to all the disclosure
requirements and restrictions would be put on where money
could be raised. Money could not be raised from a
corporation or labor union and no more than 10% of it could
be raised outside of the state. Depending upon the type of
organization there were limitations on the amount that could
be raised from individuals. To this end, the language,
"includes an express communication and an electioneering
communication, but does not include and issues
communication" was added in lines 17-19 in Sec. 6.
· Sec. 7 defined a communication. This was not intended to be
an exhaustive list of items that might be a communication
but identified the kind of things that were traditionally
seen in campaigns.
o Paragraph (13) excluded communications that cost $500
or less to comply with the Supreme Court's 1995
MacIntire decision. In that case a woman felt so
strongly about a local school bond proposal that she
printed a flyer and distributed it. She was found to
be in violation of Ohio statutes. The exception
provided protection to keep that from happening.
o Paragraph (14) defined an electioneering communication
as a communication that "occurs within 30 days
preceding a primary election or a municipal election,
or within 60 days preceding a general election,"
"directly or indirectly identifies a candidate" and
"addresses an issue of national, state, or local
political importance and attributes a position on that
issue to the candidate identified." This came from the
Buckley v. Valeo decision, which said express advocacy
could be regulated but issue advocacy could not be
regulated. Finding a line between the two had been
very difficult. Congress recently passed the Shays-
Meehan version of the McCain-Feingold legislation. The
parts of the definition regarding the timeframe and
identifying a candidate came from that legislation.
The other aspect of the definition regarding
attributing a position to a candidate was a further
step toward trying to define advocacy that can be
regulated.
o Paragraph (15) defined an express communication as "a
communication that, 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." This came from the Furgatch decision.
nd
· Sec. 8 changed the crime of campaign misconduct in the 2
degree to conform to the changes in SB 363.
· Sec. 9 repealed AS 15.13.080, which was the 15-5 reporting
requirement.
· Sec. 10 provided for an immediate effective date.
SENATOR PHILLIPS wanted to make it clear that the section
regarding the "paid for by" statements had been removed from SB
363.
MR. BALASH said it had been.
CHAIRMAN THERRIAULT said the courts wanted a bright line so
citizens would know when they crossed the line and were doing an
activity that required disclosure or had limitations on funding
sources. The courts said if the citizens had no way of knowing
when they crossed the line, it had a chilling effect on free
speech because they might not express opinions that might get
them into trouble. He said a clear line was drawn in SB 363. He
said the Buckley v. Valeo decision listed some words that had
been taken as a complete list. He said with the definition of
express communication in SB 363, those magic words wouldn't
necessarily need to be used for a communication to qualify.
MR. BALASH said that was correct.
CHAIRMAN THERRIAULT said that went back to the Furgatch decision,
which said it was nonsensical to use a list of words because
anybody with a thesaurus could circumvent it.
MR. BALASH said that was correct.
CHAIRMAN THERRIAULT said a communication such as, "We want to
develop industry in Alaska, Senator Gene Therriault has been
striving to create jobs and we just wanted you to know that,"
would qualify as an electioneering communication even though it
didn't say to vote for or against the candidate. Because it
identified an issue of importance, identified a candidate and
attributed a position to that candidate and was being done around
an election it would be an electioneering communication. He said
SB 363 tried to draw a line that indicated to a citizen the
criteria under which you were trying to influence the outcome of
an election. The courts said that when you were trying to
influence the outcome of an election, the government had a right
to limit the influence individuals or out-of-state sources of
funds could exert on elections. He said SB 363 combined a number
of court cases and the McCain-Feingold legislation to try to
define when the intent of issue advocacy is to affect the outcome
of an election. He asked Mr. Balash if he wished to discuss
anything else.
MR. BALASH said the standard of intending to influence the
outcome of an election was used throughout AS 15.13 and tried to
describe the things that were done in the course of a campaign
th
and the disclosure of those items. The 4 Circuit Court of
Appeals in Perry v. Bartlett decided that a similar definition
used in North Carolina was too vague and not specific enough for
the public to know when they were required to disclose their
th
publications. Because this wasn't a 9 Circuit Court of Appeals
or a U.S. Supreme Court decision, it didn't necessarily apply in
Alaska. However, it should be looked at to find out exactly what
standard was used in deciding the case.
CHAIRMAN THERRIAULT asked if there were any further questions for
Mr. Balash. There were none.
MS. BROOKE MILES, Executive Director of APOC, said she applauded
the committee for their courage in defining express communication
and issues communication. She said APOC staff really appreciated
a bright line being drawn. She said she suspected the courts
would decide the definitions eventually. She wanted to discuss
Section 1. She said she did not have a problem with removing the
contributor reporting requirements, but she did find issue with
the language. She said it would probably be better to delete all
the language in this section after the word "commission" on page
1, line 7. She said the rest of the language in (d)(1)(A) and
(B) would cause confusion. She said independent expenditures
made of behalf of a candidate or ballot question were reportable
in any amount so the $500 limit would cause confusion. She said
a strict reading might compel a group that talked to a candidate
and wanted to buy a communication to think they would have to
report.
CHAIRMAN THERRIAULT said he wanted to make sure that she was
suggesting to delete all of the language in Section 1 after the
word "commission" on page 1, line 7.
MS. MILES said that was correct.
SENATOR PHILLIPS asked if that would end on page 2 at line 9.
MS. MILES said that was correct.
CHAIRMAN THERRIAULT asked if this deletion would change other
sections of the statute.
MS. MILES said it would be necessary to retain paragraph (2)
because it talked about being exempted from the reporting
requirement because of the MacIntire decision.
CHAIRMAN THERRIAULT asked if she was talking about the language
in Sec. 2.
MS. MILES said the language starting on page 2, line 4 provides
for the MacIntire exemption for small expenditures. She said
that should not be deleted.
SENATOR PHILLIPS said he wanted to make sure he understood what
she was suggesting. He said it would be necessary to put a
period on page 1, line 7, after the word "commission," and delete
everything thereafter on page 1 and the first three lines on page
2, but leave paragraph (2), which would be renumbered to (1).
MS. MILES said it could also be incorporated but his description
was correct.
SENATOR PHILLIPS moved a conceptual Amendment #1 putting a period
after the word "commission" on page 1, line 7, deleting
everything after that on page 1 and lines 1-3 on page 2 and
leaving paragraph (2).
CHAIRMAN THERRIAULT said he wasn't so sure the drafters would
want to put a period after "commission."
SENATOR PHILLIPS said that was where the section would end.
CHAIRMAN THERRIAULT said they would probably want to put a comma
and go on to paragraph (2). He said as long as it was a
conceptual amendment, the drafters could work with it.
TAPE 02-28, SIDE B
CHAIRMAN THERRIAULT asked if there was any objection to
conceptual Amendment #1.
SENATOR PHILLIPS asked Ms. Miles if that was all.
MS. MILES said it was. She said she was happy to see Internet
communications included. She said APOC had been discussing
Internet communications more and more over the last few years and
they considered them to be subject to the law but it would be
helpful to have it codified.
CHAIRMAN THERRIAULT said the Internet was becoming a bigger tool
for good and bad. He wanted to make sure that dropping the 15-5
requirement was not going to create problems. He also wanted to
be sure the 15-5s would be needless paperwork after the changes
in SB 363.
MS. MILES said APOC staff believed there was probably still some
value in the 15-5s for contributions given to political parties
or ballot proposition groups, the two groups to which an
individual can contribute more than $500. She said $5000 could
be contributed to a political party in a calendar year and
contributions to ballot proposition groups were unlimited. She
said the 15-5s provided meaningful information in the time
periods when other information was not available. She said
without the 15-5s the first information on contributions to
ballot proposition groups would not be available until 30 days
before the general election. She said that would also hold true
to some extent with political parties.
CHAIRMAN THERRIAULT asked if Ms. Miles only saw that problem with
regards to contributions to ballot proposition groups.
MS. MILES said yes.
CHAIRMAN THERRIAULT asked if that could be easily retained.
MS. MILES said the 15-5 language could be written to require a
contributor report for contributions of more than $500 made to
ballot proposition groups. She said ballot propositions were
often very controversial and if the 15-5 report was required for
contributions to ballot proposition groups, APOC could have some
information available for the public.
CHAIRMAN THERRIAULT said Senator Phillips told him they could
work on that in the Senate Rules Committee.
SENATOR PHILLIPS said SB 363 was a Senate Rules Committee bill.
CHAIRMAN THERRIAULT said he wanted to deal with the 15-5 reports
and remove the requirements that didn't make sense. But if they
were a source of valuable information, he didn't want to lose
that. He said Ms. Miles had said it was nice to have bright
lines.
MS. MILES said bright lines make it easier to conduct training,
review the courts, and identify advertisements.
CHAIRMAN THERRIAULT said the courts like bright lines as well.
MS. MILES said it would probably go before the courts eventually.
She said the definitions seemed very similar to the new federal
statutes, especially the timelines separating electioneering from
issue advocacy.
CHAIRMAN THERRIAULT said they were from the federal legislation.
SB 363 added some further definition to electioneering
communications by adding that they attributed a position on an
issue to an identified candidate.
MS. MILES said for the most part, the changes would be enacted
before advocacy became a big issue.
CHAIRMAN THERRIAULT said communications that would be defined as
electioneering communications would be allowed at any other time
except for right before an election.
MS. MILES said if they did it right before the election, they
would be required to file a report and the money spent on the
communication would have to be funding authorized by the State.
CHAIRMAN THERRIAULT said that was because at that point the
communication would be trying to influence the outcome of an
election and the State would be able to require disclosure and
limitations on outside sources of money.
MS. MILES said that was correct. She said an outside corporation
would not be allowed to engage in that kind of activity within
close proximity to an election.
CHAIRMAN THERRIAULT asked about the fiscal note.
MS. MILES said it would be revised.
MR. BALASH said he had a fiscal note for $30,000 to distribute to
the committee.
CHAIRMAN THERRIAULT asked if that fiscal note would change with
the new CS.
MS. MILES hoped it would. She said it would still be necessary
to conduct a training program so everybody understood the changes
in the law but the other problems she had discussed earlier would
no longer exist.
CHAIRMAN THERRIAULT read the following from the fiscal note:
This bill creates additional requirements for
candidates and groups when identifying their paid
political communications. It represents significant
administrative difficulties in that it also creates a
new kind of political communication (electioneering)
which is defined and enforced by the Division of
Elections. The funding request is for training, paper
and printing, and enforcement.
MS. MILES said she didn't see the same enforcement concerns.
Initially, she was concerned with the requirement that production
costs be included in the "paid for by" statement. She said most
of the inquiries APOC received were about the "paid for by"
statement and they spent a lot of time working with groups and
candidates to get them corrected. She said a lot of people might
have made mistakes with production costs because they might not
have been sure of them and given an estimate. She said with the
new CS that would no longer be a concern. She still felt it was
necessary to have funds to let everybody know about the changes.
SENATOR DAVIS asked if the CS had been adopted.
CHAIRMAN THERRIAULT said it had not. He noted that they had
discussed conceptual Amendment #1 without the CS before them. He
said they were working on an unofficial document. He asked for a
motion on the L version.
SENATOR PHILLIPS moved the L version of SB 363 with conceptual
Amendment #1 out of committee with attached fiscal note and
individual recommendations.
There being no objection, CSSB 363(STA) moved out of committee
with attached fiscal note and individual recommendations.
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