Legislature(2001 - 2002)
05/04/2002 01:35 PM STA
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
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Offices Commission (APOC) suggested that the 15-5 reporting burden on contributors might be unnecessary so Sec. 9 repealed that requirement.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.