Legislature(2017 - 2018)BUTROVICH 205

02/22/2018 03:30 PM STATE AFFAIRS

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-- Public Testimony --
Heard & Held
Moved CSSB 130(STA) Out of Committee
          HB 44-LEGISLATIVE ETHICS: VOTING & CONFLICTS                                                                      
3:32:05 PM                                                                                                                    
CHAIR  MEYER announced  the consideration  of House  Bill 44  (HB
44). He said the committee will continue with public testimony.                                                                 
3:32:25 PM                                                                                                                    
SENATOR EGAN joined the committee meeting.                                                                                      
3:32:46 PM                                                                                                                    
BARBARA  BELKNAP, Advocate,  League  of  Women's Voters,  Juneau,                                                               
Alaska, testified in  support of HB 44. She  said transparency in                                                               
government  is  important  to  the  league  at  all  levels.  She                                                               
asserted  that a  voting  official with  a  conflict of  interest                                                               
should  not  be  voting  on legislation  that  will  benefit  the                                                               
official  more   than  the  public.   She  stated  that   one  of                                                               
democracy's  greatest  challenges  comes  from  citizens  who  no                                                               
longer think  government represents  or cares  about them  and in                                                               
response fails to  participate in democracy. She  opined that the                                                               
erosion of  confidence is evident  from the declining  numbers of                                                               
citizens participating  in elections.  She asserted that  part of                                                               
restoring confidence is  making it clear that  legislators do not                                                               
use their position for personal gain.                                                                                           
3:34:26 PM                                                                                                                    
CHAIR MEYER closed public testimony.                                                                                            
He explained that in the  previous hearing the committee wrestled                                                               
with different conflicts  of interest, how to  define conflict of                                                               
interest,  and why  is it  good for  one and  maybe not  good for                                                               
another body.  He noted that  Senator Giessel brought up  a point                                                               
in the  previous meeting that  HB 44  does not change  things too                                                               
much. It  defines what a  conflict of  interest is with  a dollar                                                               
amount of anything  greater than $10,000. He asked  if the member                                                               
still votes after declaring a conflict.                                                                                         
3:35:46 PM                                                                                                                    
REPRESENTATIVE  JASON GRENN,  Alaska  State Legislature,  Juneau,                                                               
Alaska,  sponsor of  HB 44,  replied that  the $10,000  helps the                                                               
definition of an employer. He continued as follows:                                                                             
     It's not  in regard  to what the  benefit might  be but                                                                    
     actually   just  putting   it  in   statute  what   the                                                                    
     definition of  that relationship between  an individual                                                                    
     and an employer, what  constitutes that relationship. I                                                                    
     think  where   the  conflict  comes  into   play  is  a                                                                    
     significant benefit, that  is the term that  is kind of                                                                    
     the key in terms of  what might constitute the conflict                                                                    
     for an individual, their spouse  or their employer, but                                                                    
     I think  that is  the main  term regarding  a potential                                                                    
     conflict, a  significant benefit.  The bill is  what we                                                                    
     are  focusing   on  is  obviously  the   definition  of                                                                    
     conflict of interest and when  that might arise and why                                                                    
     would someone ask to recuse themselves from voting.                                                                        
CHAIR MEYER  asked if a  legislator would still vote  if somebody                                                               
REPRESENTATIVE GRENN answered yes.                                                                                              
CHAIR  MEYER remarked  that  Representative  Grenn's proposal  is                                                               
similar to what the Legislature currently does.                                                                                 
SENATOR  WILSON  asked  if Legislative  Research  said  that  the                                                               
Ethics  Committee  identifies  the "significant  benefit"  dollar                                                               
amount as $250.                                                                                                                 
3:37:16 PM                                                                                                                    
RYAN   JOHNSTON,  Staff,   Representative  Grenn,   Alaska  State                                                               
Legislature,  Juneau,  Alaska,   recalled  that  Jerry  Anderson,                                                               
[Committee  Administrator for  the  Ethics  Committee], said  the                                                               
$250  amount was  for a  close  economic association,  not for  a                                                               
significant benefit on a legislative matter.                                                                                    
SENATOR  WILSON asked  if there  is  a number  for a  significant                                                               
MR. JOHNSTON  answered no and Representative  Grenn's office took                                                               
the $10,000 amount to mirror what was already in statute.                                                                       
SENATOR   GIESSEL  referenced   the   definition  of    financial                                                               
interest  in  section 4 on  page 3,  line 9, paragraph  (17). She                                                               
noted it  talks about "professional or  private relationship" and                                                               
asked if that is where the $250 comes in.                                                                                       
MR. JOHNSTON  answered that  a close  economic association  for a                                                               
professional  or  private  relationship  would  fall  under  that                                                               
definition.  In that  situation,  $250 would  be  the amount.  He                                                               
added that he would clarify that with Jerry Anderson.                                                                           
CHAIR MEYER  asked Representative Grenn  if he was  involved with                                                               
or part  sponsor of the  initiative that deals with  the conflict                                                               
of interest and other things.                                                                                                   
3:39:49 PM                                                                                                                    
REPRESENTATIVE GRENN answered yes. He  explained that there is an                                                               
initiative that will hopefully be  before the voters in November.                                                               
He detailed  that it deals with  five points that are  focused on                                                               
legislative  reform,  one  of  them   is  regarding  conflict  of                                                               
CHAIR MEYER  asked if  the initiative would  be removed  from the                                                               
ballot if  HB 44  was passed.  He inquired  if the  initiative is                                                               
asking  for  different things  than  HB  44.  He noted  that  the                                                               
initiative  states that  a  legislator cannot  vote  while HB  44                                                               
states that  a legislator can vote  if a conflict of  interest is                                                               
REPRESENTATIVE  GRENN  explained  that  the  bill  addresses  the                                                               
Legislature's uniform  rules regarding  the conflict  of interest                                                               
definition whereas an initiative  cannot change uniform rules. He                                                               
pointed  out  that  the initiative  closely  mirrors  the  bill's                                                               
He  addressed  the  question  whether  the  initiative  would  be                                                               
removed from the  November ballot if HB 44 passed.  He noted that                                                               
in previous rulings  an initiative is ruled to be  removed if the                                                               
legislation  that becomes  law is  deemed  to be  similar to  the                                                               
initiative.  He pointed  out that  the initiative  has many  more                                                               
parts than conflict of interest.                                                                                                
3:41:53 PM                                                                                                                    
CHAIR MEYER  asked if he has  spoken to Legal Services  to see if                                                               
the initiative would be offset if HB 44 passes.                                                                                 
MR. JOHNSTON replied Representative  Grenn's office has asked for                                                               
a memo from Legal Services.                                                                                                     
SENATOR  GIESSEL disclosed  that  the  Senate Secretary's  Office                                                               
verified that  for similar conflict-of-interest  legislation that                                                               
there is a public document  recording when a legislator stands up                                                               
and  states a  perceived or  possible conflict  of interest.  She                                                               
reiterated  that  she questioned  what  HB  44 changes  that  the                                                               
Legislature already  does. She noted  that section 1 of  the bill                                                               
addresses  a  legislator's  employer  and  referenced  a  related                                                               
situation in the  House that occurred where  an individual served                                                               
a jail sentence for a violation.  She said she questioned what HB
44 is helping or changing about the Legislature's transparency.                                                                 
3:44:03 PM                                                                                                                    
REPRESENTATIVE GRENN replied as follows:                                                                                        
     I  believe  that that  section  is  in current  statute                                                                    
     regarding  negotiating  for  employment,  that  is  our                                                                    
     current  definition  of  where  conflict  of  interests                                                                    
     might rise when there is an actual quid pro quo.                                                                           
     What we  are saying is we  believe that the bar  can be                                                                    
     raised,  and an  actual  conflict is  there  or even  a                                                                    
     perceived  conflict,  we  are  trying  to  remove  that                                                                    
     ambiguity of  when people can  rise. You  see sometimes                                                                    
     where people rise to declare  conflicts which given our                                                                    
     current definition  are not conflicts,  but they  do so                                                                    
     because they want to be transparent and be open.                                                                           
     What this legislation is hopefully  doing is now giving                                                                    
     an actual  definition that  we can  all follow,  and we                                                                    
     can point to  when we do talk to  constituents about us                                                                    
     following the  actual statute  when conflicts  arise or                                                                    
     potentially arise. Our  belief is that this  puts us in                                                                    
     line  with the  majority of  other states,  states that                                                                    
     have   dealt  with   actual   corruption  and   they've                                                                    
     addressed those through conflict  of interest in ethics                                                                    
     acts.  Fortunately for  Alaska I  believe that  we have                                                                    
     very few acts  like that and we have  a great integrity                                                                    
     within our body, but the  main goal of this, increasing                                                                    
     transparency,   increasing  trust   with  the   general                                                                    
     public; this  would help put  into law a  standard that                                                                    
     is  higher than  what we  have now  and really  creates                                                                    
     actually less  ambiguity of what conflicts  of interest                                                                    
CHAIR MEYER opined that Representative Grenn's statement is                                                                     
subject to interpretation.                                                                                                      
REPRESENTATATIVE GRENN concurred.                                                                                               
CHAIR MEYER said ethics rules and laws have changed over time                                                                   
and there is nothing that says they cannot be changed some more.                                                                
SENATOR GIESSEL point out that  Senator Coghill and Senator Meyer                                                               
have  seen  ethics  rules  both  change  and  work  during  their                                                               
legislative tenure. She  asserted that people on  the Senate side                                                               
have been diligent  in declaring conflicts of  interest and noted                                                               
that she  has stood  up when  voting on the  budget to  declare a                                                               
conflict  of  interest   because  cuts  were  being   made  to  a                                                               
department that  her husband worked  in. She reiterated  that the                                                               
Legislature  currently  follows its  ethics  rules  and is  quite                                                               
3:47:17 PM                                                                                                                    
SENATOR  COGHILL  pointed  out that  legislators  currently  make                                                               
financial disclosures on the record  that include their families.                                                               
He asserted  that the bill  will now include family  members that                                                               
may or may not be of real  value. He addressed his history in the                                                               
Legislature and  noted that he  has, "Seen more  shenanigans with                                                               
those  kinds  of  things  that real  ethical  issues  brought  to                                                               
light." He continued as follows:                                                                                                
     Those  are  always  a  concern   when  we  bring  these                                                                    
     transparency things  out is its  how will they  be used                                                                    
     in  a   political  forum,  and  with   you  putting  an                                                                    
     initiative  forward you  are pretty  well aware  of the                                                                    
     politics of that and how you  can use both the real law                                                                    
     for  real   transparency  and  perceived   problems  as                                                                    
     political footballs  and that  has happened a  lot down                                                                    
He  said  citizen legislators  with  families  are encouraged  to                                                               
report  their   financial  status   with  their   various  family                                                               
entanglements. He added as follows:                                                                                             
     The fact  is, if people  elect the legislators,  and it                                                                    
     is  true  that  people  could game  that  and  probably                                                                    
     aggrandize  their family,  but  that's  less likely  to                                                                    
     happen  because   of  the   transparency  we   have  on                                                                    
     financial reporting issues. I  think what you are doing                                                                    
     is you are  creating a place for "got  you" rather than                                                                    
     real clarity  of transparencies;  those are  the things                                                                    
     that I  get concerned  about and  I've watched  how the                                                                    
     media has  used that to  pick on their  favorite people                                                                    
     to pick  on and that is  an unethical thing in  my view                                                                    
     and  you haven't  been the  beneficiary of  it, I  have                                                                    
     been.  So,  if you  are  accused  of something  in  the                                                                    
     newspaper,  it's  a  headline,  you might  as  well  be                                                                    
     guilty  of   a  felony  in  many   cases  because  your                                                                    
     reputation is  just taken  to the  task that  much. So,                                                                    
     there's  a balance  here between  the transparency  for                                                                    
     clarity or a tool to use people unwisely.                                                                                  
     When  I read  these things,  I  try to  watch for  that                                                                    
     balance  all of  the time  and I  just don't  know that                                                                    
     this hits that balance yet,  but I've been quiet a long                                                                    
     time  because   I've  had  to   think  about   how  the                                                                    
     implementation  of this  works, it's  just not  what it                                                                    
     says, it's the implementation.  I've been on the Ethics                                                                    
     Committee  for a  lot of  years  and I've  been in  the                                                                    
     Rules  Committee,  I've  been part  of  the  leadership                                                                    
     team, and  I've watched  how people's whole  lives have                                                                    
     been taken  to task inappropriately under  the guise of                                                                    
     ethics or  transparency. I've  also seen  people misuse                                                                    
     the rules  and go to  jail. I  was here when  my party-                                                                    
     guys  were going  to jail  because they  put their  own                                                                    
     self interest above  the others, but the  rules that we                                                                    
     had back then were sufficient to put them in jail.                                                                         
     I  was part  of the  group that  put a  huge change  in                                                                    
     because the year after everybody  was going to jail, we                                                                    
     probably had  40 bills introduced  that year on  how we                                                                    
     were   going   to   make  it   more   transparent   and                                                                    
     accountable. Max Gruenberg and  I got together and said                                                                    
     we   can't  have   40   bills   floating  through   the                                                                    
     Legislature, so we  as a bipartisan effort  went to the                                                                    
     leadership and said that; I  was the Judiciary chairman                                                                    
     at the time,  let us work on them so  that we can coral                                                                    
     them into  a unit of a  code problem, and even  at that                                                                    
     we got into  a bidding war on the floor,  who was going                                                                    
     to   be  the   most  transparent,   we  couldn't   help                                                                    
     ourselves, but we  put in a code that had  a few places                                                                    
     that is  tough, but it's  a better code than  even when                                                                    
     people were  going to  jail, but the  code that  we put                                                                    
     into place was  a higher bar, but the code  that we had                                                                    
     in place was sufficient for  those that were gaming the                                                                    
     What we did do was  we put into place some transparency                                                                    
     rules, but we also had  to put confidentiality in there                                                                    
     because  it became  really apparent  that  it became  a                                                                    
     whipping tool  rather than  an accountability  tool. We                                                                    
     had  to endure  two or  three  years of  misuse of  the                                                                    
     press of  people who were  sterling characters  but had                                                                    
     been  charged   just  because  of  a   technical  or  a                                                                    
     grammatical or  some other error  and they  got charged                                                                    
     with  being unethical  when in  reality it  was not  an                                                                    
     unethical thing,  it was just a  methodology thing. So,                                                                    
     those kinds  of things  do happen  here, and  they went                                                                    
     through a whole new cycle.                                                                                                 
     So, those are  the kinds of things I watch  what we are                                                                    
     doing here, now we are  asking we are going involve our                                                                    
     immediate family, then what you  are going to do is you                                                                    
     are going  to create the  questions upon if  you forgot                                                                    
     something, and  it was  your third  cousin; but,  I can                                                                    
     tell you  then they  just go the  next step  beyond and                                                                    
     say  well  it   was  your  third  cousin,   it  was  an                                                                    
     immediate. The  trouble is  in Alaska,  we are  a small                                                                    
     community and  we have  business dealings  very broadly                                                                    
     and quite  deeply quite often in  communities. Now that                                                                    
     you are including  the family in it it's  a new wrinkle                                                                    
     and  I've been  thinking how  that works,  I can't  say                                                                    
     that  I've arrived  at a  good conclusion  yet, but  in                                                                    
     looking   through   this   I've  tried   to   take   it                                                                    
     thoughtfully, but  you just needed the  benefit of some                                                                    
     of the history of how  these things have both been well                                                                    
     used and poorly used.                                                                                                      
3:53:45 PM                                                                                                                    
REPRESENTATIVE  GRENN  commented  that  he takes  no  offense  by                                                               
benefitting from Senator Coghill's  and the committee's knowledge                                                               
related to  the bill.  He said  he brings  a new  prospective. He                                                               
asserted  that his  constituents  want  something different  than                                                               
what  is currently  in statute  and that  is the  reason for  his                                                               
passion for different reforms in the Legislature.                                                                               
He referenced  the family aspect  and financial  disclosures that                                                               
Senator Coghill noted and explained that  the bill puts more in a                                                               
public forum  that is  not hidden  on a website  that is  hard to                                                               
navigate. He  asserted that the  bill allows legislators  to find                                                               
ways to  add transparency and trust,  especially when legislators                                                               
are away from their constituency during the session.                                                                            
He  disclosed   that  the  definition   used  for   "family"  and                                                               
"employer" is used in 29 other  states. He noted that some states                                                               
bar  legislators from  voting without  a vote  or objection  when                                                               
there is a conflict of interest.                                                                                                
He said  different states  do it different  ways, but  his intent                                                               
was to  define ways  to keep  the conversation  going, especially                                                               
with the  public when legislators are  talking about transparency                                                               
and trust.                                                                                                                      
3:56:21 PM                                                                                                                    
SENATOR  COGHILL   remarked  that   Representative  Grenn   is  a                                                               
legislator who has  chosen to go into a "public  manner" and that                                                               
becomes  a   political  campaign   over  against   a  substantive                                                               
campaign. He said he would have  been more open to the discussion                                                               
if  someone  had not  said,  "The  Legislature isn't  transparent                                                               
therefore we  need to do  this." He asserted  that Representative                                                               
Grenn cannot  have it both  ways and said the  representative was                                                               
going to have a struggle with him on the bill.                                                                                  
SENATOR WILSON asked  if there is a timeline  when conflicts must                                                               
be known. He noted scenarios where  a legislator may not be aware                                                               
of  transactions  from  close economic  associations,  especially                                                               
when voting.                                                                                                                    
REPRESENTATIVE  GRENN  replied   that  he  is  not   aware  of  a                                                               
retroactive rule when a legislator  votes when not being aware of                                                               
a conflict. He noted that there  is an ethics committee to confer                                                               
with if something comes up afterwards.                                                                                          
3:59:17 PM                                                                                                                    
SENATOR   WILSON   pointed  out   that   the   bill  would   make                                                               
nondisclosure a  statute violation  versus an  ethical disclosure                                                               
act violation which  may have a higher level of  consequence as a                                                               
legislator versus an unknown error.                                                                                             
MR. JOHNSTON replied as follows:                                                                                                
     Since this statute is under  AS 24.60.030, which is the                                                                    
     legislative  ethics,  the  same kinds  of  rulings  the                                                                    
     ethics committee  can do  now also  are the  same under                                                                    
     this  bill.   So,  it  would   be  the  same   kind  of                                                                    
     consequences that the ethics committee could decide.                                                                       
CHAIR MEYER asked if the bill does the following:                                                                               
   • Does not bar a legislator from voting.                                                                                     
   • Legislator must declare a conflict of interest and ask to                                                                  
     be excused.                                                                                                                
   • Legislator must vote if another legislator objects.                                                                        
REPRESENTATIVE GRENN answered correct.                                                                                          
CHAIR MEYER said in  that case he does not know  that the bill is                                                               
too much different  from what the Legislature  currently does. He                                                               
noted  that  the  next  committee   of  referral  is  the  Senate                                                               
Judiciary Committee. He said before  the bill leaves committee he                                                               
would  like to  see  the legal  analysis if  there  is enough  to                                                               
offset it  from being  on the ballot.  He concurred  with Senator                                                               
Coghill that, "Once you do an  initiative then it becomes part of                                                               
the political campaign."                                                                                                        
SENATOR GIESSEL inquired  if offering a bill at the  same time as                                                               
offering a ballot  initiative is an ethical  violation. She added                                                               
as follows:                                                                                                                     
     It's  an  interesting  question  because  it  could  be                                                                    
     viewed that  way, depending kind  of like beauty  is in                                                                    
     the eye of  the beholder, ethics conflicts  could be in                                                                    
     the eye of the interpreter as well.                                                                                        
CHAIR  MEYER said  Senator Giessel  brought up  a good  point and                                                               
that is why the topic is  difficult to bring up. He summarized as                                                               
     The bottom line is it is  up to the voters to decide if                                                                    
     we are ethical or not  ethical and whether they want us                                                                    
     to  represent  them  or  not   represent  them,  but  I                                                                    
     appreciate you  bringing this forward and  we will look                                                                    
     forward to the legal analysis.                                                                                             
4:02:30 PM                                                                                                                    
CHAIR MEYER held HB 44 in committee.                                                                                            

Document Name Date/Time Subjects
CSSB 130 Version J.pdf SSTA 2/22/2018 3:30:00 PM
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SB 130 Ltr from Div of Elections.pdf SSTA 2/22/2018 3:30:00 PM
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