Legislature(1995 - 1996)

03/22/1996 01:12 PM JUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
               HOUSE JUDICIARY STANDING COMMITTEE                              
                         March 22, 1996                                        
                           1:12 p.m.                                           
                                                                               
                                                                               
 MEMBERS PRESENT                                                               
                                                                               
 Representative Brian Porter, Chairman                                         
 Representative Joe Green, Vice Chairman                                       
 Representative Con Bunde                                                      
 Representative Bettye Davis                                                   
 Representative Al Vezey                                                       
 Representative Cynthia Toohey                                                 
 Representative David Finkelstein                                              
                                                                               
 MEMBERS ABSENT                                                                
                                                                               
 All members were present.                                                     
                                                                               
 COMMITTEE CALENDAR                                                            
                                                                               
 HOUSE BILL NO. 368                                                            
 "An Act relating to election campaigns, election campaign                     
 financing, the oversight and regulation of election campaigns by              
 the Alaska Public Offices Commission, the activities of lobbyists             
 that relate to election campaigns, and the definitions of offenses            
 of campaign misconduct; and providing for an effective date."                 
                                                                               
      - HEARD AND HELD                                                         
 HOUSE BILL NO. 443                                                            
 "An Act relating to the tax on transfers or consumption of motor              
 fuel, and repealing the exemption from that tax for motor fuel                
 which is at least 10 percent alcohol by volume; and providing for             
 an effective date."                                                           
                                                                               
      -  SCHEDULED BUT NOT HEARD                                               
 HOUSE BILL NO. 474                                                            
 "An Act relating to violations of municipal ordinances and                    
 regulations; and amending the definition of the jurisdiction of the           
 superior court and the Department of Health and Social Services               
 over delinquent minors to add a further exclusion from that                   
 jurisdiction for a minor's violation of a municipal ordinance or              
 regulation that is punishable as an infraction or violation, and              
 making a related technical amendment to that jurisdictional                   
 definition."                                                                  
                                                                               
      -  SCHEDULED BUT NOT HEARD                                               
 HOUSE BILL NO. 414                                                            
 "An Act requiring conciliation panel review in a civil action                 
 against an architect, engineer, or land surveyor; and providing for           
 an effective date."                                                           
                                                                               
      -  SCHEDULED BUT NOT HEARD                                               
 PREVIOUS ACTION                                                               
                                                                               
 BILL:  HB 368                                                               
 SHORT TITLE: ELECTION CAMPAIGN FINANCE REFORM                                 
 SPONSOR(S): REPRESENTATIVE(S) JAMES                                           
                                                                               
 JRN-DATE     JRN-DATE             ACTION                                      
 12/29/95      2362    (H)   PREFILE RELEASED                                  
 01/08/96      2362    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 01/08/96      2362    (H)   STA, JUDICIARY, FINANCE                           
 01/25/96              (H)   STA AT  8:00 AM CAPITOL 102                       
 01/25/96              (H)   MINUTE(STA)                                       
 01/30/96              (H)   STA AT  8:00 AM CAPITOL 102                       
 01/30/96              (H)   MINUTE(STA)                                       
 02/01/96              (H)   STA AT  8:00 AM CAPITOL 102                       
 02/01/96              (H)   MINUTE(STA)                                       
 02/29/96              (H)   STA AT  8:00 AM CAPITOL 102                       
 02/29/96              (H)   MINUTE(STA)                                       
 03/05/96              (H)   STA AT  8:00 AM CAPITOL 102                       
 03/05/96              (H)   MINUTE(STA)                                       
 03/09/96              (H)   STA AT 10:00 AM CAPITOL 102                       
 03/09/96              (H)   MINUTE(STA)                                       
 03/12/96      3087    (H)   STA RPT  CS(STA) NT 2DP 3NR                       
 03/12/96      3088    (H)   DP: JAMES, PORTER                                 
 03/12/96      3088    (H)   NR: GREEN, IVAN, ROBINSON                         
 03/12/96      3088    (H)   FISCAL NOTE (ADM)                                 
 03/12/96      3088    (H)   REFERRED TO JUDICIARY                             
 03/20/96              (H)   JUD AT  1:00 PM CAPITOL 120                       
 03/20/96              (H)   MINUTE(JUD)                                       
 03/22/96              (H)   JUD AT  1:00 PM CAPITOL 120                       
                                                                               
 WITNESS REGISTER                                                              
                                                                               
 JEANNETTE JAMES, Representative                                               
 Alaska State Legislature                                                      
 State Capitol Building, Room 102                                              
 Juneau, Alaska  99801                                                         
 Telephone:  (907) 465-3743                                                    
 POSITION STATEMENT:  Presented sponsor statement for HB 368.                  
                                                                               
 BROOKE MILES, Juneau Branch Administrator                                     
 Alaska Public Offices Commission (APOC)                                       
 P.O. Box 110222                                                               
 Juneau, Alaska  99811-0222                                                    
 Telephone:  (907) 465-4865                                                    
 POSITION STATEMENT:  Provided commission's position and answered              
                      questions regarding HB 368.                              
                                                                               
 C.S. "CHRIS" CHRISTENSEN III, Staff Counsel                                   
 Alaska Court System                                                           
 303 K Street                                                                  
 Anchorage, Alaska 99501                                                       
 Telephone:  (907) 264-8228 (Anchorage)                                        
             (907) 463-4771 (Juneau)                                           
 POSITION STATEMENT:  Testified on HB 368.                                     
                                                                               
 GLEN SCHRADER                                                                 
 P.O. Box 1264                                                                 
 Kenai, Alaska  99611                                                          
 Telephone:  (907) 283-4359                                                    
 POSITION STATEMENT:  Testified on HB 368.                                     
                                                                               
 KATHY ASHBY                                                                   
 Alaska Public Interest Research Group (AKPIRG)                                
 1835 West 15th                                                                
 Anchorage, Alaska  99501                                                      
 Telephone:  (907) 278-3661                                                    
 POSITION STATEMENT:  Testified on HB 368.                                     
                                                                               
 ANNE CARPENETI, Assistant Attorney General                                    
 Criminal Division                                                             
 Department of Law                                                             
 P.O. Box 110300                                                               
 Juneau, Alaska  99811-0300                                                    
 Telephone:  (907) 465-3428                                                    
 POSITION STATEMENT:  Answered questions on HB 368.                            
                                                                               
 ACTION NARRATIVE                                                              
                                                                               
 TAPE 96-40, SIDE A                                                            
 Number 0001                                                                   
                                                                               
 CHAIRMAN BRIAN PORTER called the House Judiciary Committee meeting            
 to order at 1:12 p.m.  Members present at the call to order were              
 Representatives Porter, Green, Bunde, B. Davis, Toohey and                    
 Finkelstein; Representative Vezey joined the meeting at 1:21 p.m.             
 HB 368 - ELECTION CAMPAIGN FINANCE REFORM                                   
                                                                               
 Number 0060                                                                   
                                                                               
 CHAIRMAN PORTER noted that Representative James, sponsor of HB 368,           
 would present the bill.                                                       
                                                                               
 REPRESENTATIVE JEANNETTE JAMES explained she introduced HB368                 
 because of the related initiative that had been filed.   The                  
 original bill was as close to the initiative as possible.  Despite            
 good intentions, she said, people voting on the initiative would              
 not have had the benefit of a close look at what they were voting             
 on.  Neither would they have known what unintended consequences               
 might have arisen from the initiative.  Therefore, she had felt the           
 public was entitled to have the bill go through a public process.             
                                                                               
 Number 0200                                                                   
                                                                               
 REPRESENTATIVE JAMES said Representative Finkelstein had also had             
 a bill.  After discovering needed changes, he and Representative              
 Jame had begun to work together to get a bill through the                     
 legislature that was substantially similar to the initiative and              
 that addressed concerns that might arise if the initiative went               
 forward.  In addition, they both wanted to provide the opportunity            
 for public input.  Changes to HB 368 had been made in the State               
 Affairs Committee and Representative James expected there would be            
 more.  She thanked Representative Finkelstein for his work and                
 voiced that the bill ought to have bi-partisan support.                       
                                                                               
 Number 0344                                                                   
                                                                               
 CHAIRMAN PORTER stated his intention of taking amendments that                
 would improve the bill in terms of addressing questions, anomalies            
 and gaps in the initiative, but that would maintain a substantially           
 similar posture to the initiative, especially in terms of its                 
 intent.                                                                       
                                                                               
 Number 0404                                                                   
                                                                               
 BROOKE MILES, Juneau Branch Administrator, Alaska Public Offices              
 Commission (APOC), testified that the commission had met via                  
 teleconference and reviewed CSHB 368(STA).  They had a couple of              
 technical and substantive concerns, which were addressed by                   
 amendments drafted by Representative Finkelstein.                             
                                                                               
 MS. MILES referred to page 4, line 16.  She said CSHB 368(STA)                
 changed an existing policy of the commission, which was to exempt             
 municipal candidates who spent $1,000 or less from campaign                   
 disclosure reporting.  Under CSHB 368(STA), that threshold was                
 raised to $2,500, which the commission viewed as too high.  The               
 commission feared that would eliminate virtually all of the                   
 municipal reports in most communities.  Therefore, APOC was                   
 requesting that the amount be reinstated at $1,000.                           
                                                                               
 Number 0526                                                                   
                                                                               
 MS. MILES said the other area of substantive concern was the                  
 complaint process.  She referred to page 16, line 29, which                   
 followed through in Section 21 on page 17, line 15, and said she              
 understood Representative Finkelstein had proposed an amendment               
 that addressed most of the commission's concerns.                             
                                                                               
 MS. MILES indicated two issues remained.  Both were of a question             
 nature.  First, there was reference to `publicly funded entity' in            
 a few sections of the bill.  She stated, "There is a definition in            
 there of what a publicly funded entity is, but because this bill              
 addresses the activities of individuals, of persons - and `person'            
 under the statute includes associations, corporations,                        
 organizations, companies, labor unions, natural persons - and there           
 are also provisions in this statute that include what is required             
 of the state and its political subdivisions, the commission just              
 would like to know what a publicly funded entity is.  If that                 
 language is going to remain in the bill and we'll be responsible              
 for administering it, we would need to know that."                            
                                                                               
 Number 0629                                                                   
                                                                               
 MS. MILES said the other question concerned the section addressing            
 honoraria, page 20, line 29.  Although they had discussed it and              
 understood the idea behind having it in the statute, the commission           
 believed there could be no enforcement.  She noted that the                   
 legislature had a section about honoraria very similar, if not                
 word-for-word, in the ethics code.  "And a way that that can be               
 double-checked for a legislator is that these high-profile earned-            
 income employers would have a dollar figure, so if you were                   
 receiving a salary that was not commensurate with the work that was           
 required, a member of the public could look at that and say, `wait,           
 how does an administrative assistant make a million dollars?' and             
 a complaint could be filed," she said.  On the other hand, in this            
 statute, it would be difficult, and perhaps impossible, to enforce.           
                                                                               
 Number 0759                                                                   
                                                                               
 MS. MILES mentioned the commission's fiscal note, which provided              
 APOC's fair finding of what the law would cost to enforce and                 
 administer.                                                                   
                                                                               
 CHAIRMAN PORTER asked why honoraria would not be on one of the                
 reports that the candidate or a legislator would submit.                      
                                                                               
 Number 0802                                                                   
                                                                               
 MS. MILES said if a candidate was running for office and prohibited           
 from taking this honoraria, because their financial disclosure                
 statement would provide APOC their financial picture from the                 
 previous calendar year, it would not be on the document held by the           
 commission at that point.  Although a person could file a complaint           
 with APOC, resulting in investigation and possible enforcement,               
 there would be no way to look at the prima facia material on                  
 publicly filed reports and cross-reference it.                                
                                                                               
 CHAIRMAN PORTER indicated the information would come in the next              
 year.                                                                         
                                                                               
 MS. MILES replied, "It would come in the next year if the person              
 attained office.  If the person ran for office and did not attain             
 office, the next year they would probably not be required to file             
 a conflict of interest statement unless they were appointed to a              
 board or commission or a position that required the filing."                  
                                                                               
 REPRESENTATIVE CYNTHIA TOOHEY asked if it would be in the year-end            
 report.                                                                       
                                                                               
 MS. MILES replied that usually honoraria would not be shown on a              
 campaign disclosure report.  "It would be shown on a financial                
 disclosure report," she said, "because it wouldn't be considered a            
 contribution to a campaign."  She understood the intent was that              
 that a person could not travel around, taking large honoraria, and            
 then use that as personal contributions to her or his own campaign.           
                                                                               
 Number 0890                                                                   
                                                                               
 CHAIRMAN PORTER said, "I don't think it's necessarily that.  It's             
 the idea of receiving money in any shape or form that influences              
 the legislator, whether it's campaign or whether it's legislation."           
                                                                               
 MS. MILES replied, "Right.  And it already applies to legislators.            
 This is to get it to apply to candidates."                                    
                                                                               
 Number 0925                                                                   
                                                                               
 C.S. "CHRIS" CHRISTENSEN III, Staff Counsel, Alaska Court System,             
 indicated he was general counsel to the judicial branch.  He                  
 referred to Section19, page 16, of CSHB 368(STA), which he said               
 affected the court system.  He said there were two issues.  For               
 one, he would propose a solution; for the other, he would just                
 bring the problem to the committee's attention, as he was not sure            
 a solution was possible.                                                      
                                                                               
 Number 0956                                                                   
                                                                               
 MR. CHRISTENSEN stated, "The original bill, as it was introduced,             
 gave a person the choice of either going to APOC to file a                    
 complaint or going straight to court.  And if you went straight to            
 court, the court was required to impose treble damages and the                
 complainant got to keep half.  So, essentially, the original bill             
 created a bounty hunter system.  And, as you can expect, the small            
 number of complaints that APOC gets right now is going to skyrocket           
 if people out there know that all they have to do is find something           
 wrong and they get half of the treble damages that a court                    
 imposes."  Mr. Christensen suggested most of those people would be            
 pro se litigants and that the cases would take longer than normal.            
                                                                               
 MR. CHRISTENSEN noted that the State Affairs Committee had                    
 attempted to correct the problem.  "And, of course, you're bound by           
 the problem of doing something that's substantially similar," he              
 said.  "They said that you have to go to APOC first and you can go            
 to court only if APOC hasn't issued a preliminary investigation               
 within 60 days of your filing the complaint with APOC."  He thought           
 the problem would remain to some extent, because APOC did not have            
 the resources to deal with most complaints within 60 days.  "So,              
 you're still going to see, I think, a lot more complaints filed, as           
 long as people have the right to go to court and get half of the              
 treble damages that are awarded," Mr. Christensen concluded.                  
                                                                               
 Number 1036                                                                   
                                                                               
 REPRESENTATIVE AL VEZEY referred to the clause about going straight           
 to court, treble damages and half going to the plaintiff.  He asked           
 if that came from the initial referendum.                                     
                                                                               
 MR. CHRISTENSEN replied yes.                                                  
                                                                               
 REPRESENTATIVE VEZEY asked if there was any indication about how a            
 federal or state court would look upon a bounty hunter system.  He            
 was unaware of any retribution, punishment or fine system ever                
 structured like that and thought the whole thing might be thrown              
 out as unconstitutional.                                                      
                                                                               
 MR. CHRISTENSEN said some states actually allowed private                     
 prosecution of criminal matters, although Alaska did not.  "But I             
 don't know that private prosecution is necessarily prohibited by              
 the constitution," he said.  "I think if the legislature passes a             
 statute or the voters enact a statute through the initiative                  
 process that says people can bring something to the attention of              
 the court, I'm not sure what the answer would be.  I'm sure it                
 would be challenged, but I can't tell you, `yes, it would be thrown           
 out.'"                                                                        
                                                                               
 Number 1145                                                                   
                                                                               
 REPRESENTATIVE VEZEY voiced his belief that a bounty system would             
 strike at fundamental judicial issues.                                        
                                                                               
 MS. CHRISTENSEN indicated he could not shed too much light on the             
 subject.  "This is unique," he said.  "I haven't seen this sort of            
 thing elsewhere in our law and I don't know whether other states do           
 it.  It is a can of worms and that's why I wanted to bring it to              
 the committee's attention."  He emphasized the potential for                  
 tremendous cost, as it was more expensive to go through the courts            
 than through an administrative agency.                                        
                                                                               
 Number 1207                                                                   
                                                                               
 REPRESENTATIVE DAVID FINKELSTEIN explained he would later propose             
 an amendment to the relevant sections, Sections 19 and 20.  He                
 indicated there had been "huge debates" on the disposition of the             
 penalties in the court system, relating to how much would go to the           
 plaintiff and how much to the state.                                          
                                                                               
 CHAIRMAN PORTER said he was looking at version F and pointed out              
 that the provision was on page 18, Section 22.                                
                                                                               
 MR. CHRISTENSEN concurred and said it referred back to Section 19,            
 the section he was referring to which provided a complainant had to           
 wait 60 days before going to court.  He specified that the two                
 sections worked with each other.                                              
                                                                               
 Number 1282                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN did not believe there was any evidence,            
 even with the original provisions in the initiative, that there               
 would be a stampede to the courtroom.  Whoever filed the complaint            
 could lose and end up paying court costs.  He referred to page 18,            
 which said that if the superior court found the violation was not             
 a repeat violation or part of a series or pattern of violations, or           
 was inadvertent, that imposition of the penalty may be suspended or           
 set aside.  "You're going to get part of nothing," he said.                   
 "There's every provision in here to allow justice to be served, and           
 you're not going to be much of a bounty hunter when the judge has             
 the ability to bring it down to zero."                                        
                                                                               
 MR. CHRISTENSEN responded that because there would be many pro se             
 litigants, there might be potential for mischief.  He said, "I                
 realize that to an extent, the legislature's hands are tied by the            
 substantial similarity problem.  I just wanted to draw this to your           
 attention."                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN pointed out that an upcoming amendment             
 addressed these concerns.                                                     
                                                                               
 Number 1375                                                                   
                                                                               
 MR. CHRISTENSEN referred to Section 19, which allowed imposition of           
 civil penalties.  He said he had asked two attorneys in the court             
 system and two from the Department of Law whether a person sued in            
 court for civil penalties would have the right to a jury.  "And               
 these four attorneys couldn't really agree," he said.  If a person            
 got a decision from APOC and then appealed it to court, the law was           
 clear there was no right to a civil jury.  If the complainant                 
 merely asked for an injunction, the law was also clear that there             
 was no right to a civil jury, he said.  "But it's not entirely                
 clear that if you're asking for civil penalties you don't have the            
 right to a civil jury."                                                       
                                                                               
 Number 1419                                                                   
                                                                               
 MR. CHRISTENSEN pointed out there was a subsidiary issue.  "We have           
 the whole problem of when does a person get a jury for a criminal             
 charge," he said.  "And typically the courts have held that they              
 will accept the legislature's characterization of something as                
 civil and not criminal, particularly when it's a regulatory matter            
 such as this.  But still, I think it would be better, and certainly           
 less expensive for the state, if it were clear that this did give             
 no right to a jury trial if someone were to sue for civil                     
 penalties."                                                                   
                                                                               
 MR. CHRISTENSEN referred to HB 474 and said the committee                     
 substitute for that bill contained language that would be fairly              
 suitable.  He indicated that the last few lines of page 2 of HB474            
 said, "an action for civil penalty under this section does not give           
 rise to the right to a trial by jury or counsel at public expense".           
 Mr. Christensen stated, "I think if that were simply inserted at              
 the end of Section 19, it would clarify it."                                  
                                                                               
 Number 1482                                                                   
                                                                               
 REPRESENTATIVE CON BUNDE asked what would happen if a candidate was           
 indigent.                                                                     
                                                                               
 MR. CHRISTENSEN replied, "If you're charged with something and the            
 state characterizes it as criminal, and you're facing a fine that             
 is so great as to denote criminality in the eyes of the public,               
 then you'd be entitled to a public defender if you were indigent.             
 Typically, as I indicated, the courts will accept the legislature's           
 characterization of something as a civil penalty rather than a                
 criminal penalty, although not always.  They generally will do it             
 if you're dealing with a regulatory area like this."  He indicated            
 that was true even if there was a huge fine.                                  
                                                                               
 Number 1565                                                                   
                                                                               
 GLEN SCHRADER testified via teleconference from Kenai.  Because of            
 the numerous amendments, he had not had adequate time to research             
 them.  He expressed concern about the time and effort put into the            
 bill, suggesting the initiative should simply go to the voters in             
 the fall.  If they passed it, fine; if they did not, the next                 
 legislature could work on it, he said.  He believed it was                    
 unconstitutional but felt there should be some limit on the amount            
 a candidate could spend on any particular office, whether it be               
 from contributions or his or her own money.                                   
                                                                               
 CHAIRMAN PORTER responded, "During the discussions on the bill and            
 the initiative, I think it's pretty well been concluded in this               
 body that you're correct, that trying to limit the amount of money            
 that an individual can him[self] or herself put into his own or her           
 own campaign is unconstitutional."  He explained there was some               
 inability of the legislature to respond to an initiative for two              
 years after it passed.  "So, the problems with the wording of the             
 initiative that are now known and admitted by even the drafters of            
 the initiative would be in effect for another election, at least,             
 and create, probably, more problems than the initiative would                 
 solve," Chairman Porter said, emphasizing they were not trying to             
 create something in any way dissimilar from the initiative.                   
                                                                               
 Number 1738                                                                   
                                                                               
 REPRESENTATIVE BUNDE said the initiative limited the ability of               
 people to raise money.  "What is unconstitutional is limiting the             
 ability of someone to take their own money and put [it] into a                
 campaign," he said.                                                           
                                                                               
 CHAIRMAN PORTER said, as Representative Finkelstein had pointed out           
 in the previous committee, the only step not being taken here was             
 public financing of campaigns.  He suggested that was the only way            
 that someone's personal contributions could be limited.                       
                                                                               
 MR. SCHRADER asked if there was any way to limit contributions from           
 the district or the state.                                                    
                                                                               
 CHAIRMAN PORTER replied he thought there was case law on that.                
 "We're probably passing something that is going to be                         
 constitutionally questionable anyway in limiting outside                      
 contributions," he said, explaining that the initiative totally               
 prohibited contributions from outside the state.  However, HB 368             
 made slight exceptions to that regarding relatives.  "Probably, if            
 it were challenged, we'd lose that, too," he added.                           
                                                                               
 Number 1911                                                                   
                                                                               
 KATHY ASHBY, Alaska Public Interest Research Group (AKPIRG),                  
 testified via teleconference from Anchorage.  She prefaced her                
 remarks by saying the amendments before her were not current                  
 versions.  She shared concerns about campaign financing and the use           
 of funds.  She believed the initiative, signed by 33,000 Alaskan              
 voters, was being diluted.  Even today, APOC was evidently unable             
 to do adequate enforcement because of lack of funds, staff and                
 technology, she said.  "It seems to me that many of these stabs are           
 going to be futile and the electorate is going to be back, worse              
 off than we were with the hope of an initiative. ... I would like             
 very much to see the initiative go to the ballot with all of its              
 blemishes," she concluded.                                                    
                                                                               
 REPRESENTATIVE BUNDE said he shared Ms. Ashby's goal and would much           
 prefer that the initiative, "warts and all," go to the public.                
                                                                               
 Number 2048                                                                   
                                                                               
 ANNE CARPENETI, Assistant Attorney General, Criminal Division,                
 Department of Law, explained she was raising concerns of the                  
 Criminal Division regarding criminal offenses contained in the                
 bill.  She had spoken with Representative Finkelstein and had                 
 prepared rough-draft conceptual amendments.                                   
                                                                               
 MS. CARPENETI referred to page 25, lines 29-31, which defined the             
 terms of intentionally, knowingly, recklessly and with criminal               
 negligence, the mental states for criminal law, as defined in                 
 Title11 criminal law.  "But the problem is, their use in the                  
 criminal statutes in the bill don't work in relation to their                 
 definitions," she stated.  She referred to page 24, line 12,                  
 relating to campaign misconduct in the first degree.  "The way                
 these mental states are defined in Title 11, you act intentionally            
 as to a result, not as to what you do, what you act," she                     
 explained.  "The way they're defined, you really can't                        
 intentionally violate a statute.  You can intentionally do an act             
 and intentionally cause a death, but you don't intentionally                  
 violate the murder statute," she said, emphasizing that                       
 "intentionally" was defined in relation to the result, not what               
 statute they were intending to violate.                                       
                                                                               
 Number 2125                                                                   
                                                                               
 MS. CARPENETI said the three levels of crimes in the bill all                 
 suffered from similar problems in terms of "knowingly and with                
 criminal negligence".  She offered to work with the committee on              
 it.                                                                           
                                                                               
 CHAIRMAN PORTER voiced his preference to have Ms. Carpeneti draft             
 that language and run it by him and Representatives Finkelstein and           
 James.  He asked if there was further testimony.  Hearing none, he            
 closed the public hearing.                                                    
                                                                               
 Number 2211                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN expressed appreciation to Representative           
 James and the House State Affairs Committee for their work on the             
 bill.  He noted that only the last amendment, not yet handed out,             
 was major and substantive.  Most others were relatively minor                 
 conforming provisions.  The stack of amendments he provided, dated            
 March 20, 1996, had a cover page entitled, "R. Finkelstein's                  
 proposed amendments to HB 368 in House Judiciary (13 amendments)."            
                                                                               
 Number 2298                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 1 to CSHB 368(STA),              
 which read:                                                                   
                                                                               
      Page 23, Line 8                                                          
           Delete:  "33 1/3"                                                   
           Insert:  "50"                                                       
                                                                               
      Page 23, Line 16                                                         
           Delete:  "33 1/3"                                                   
           Insert:  "50"                                                       
                                                                               
 REPRESENTATIVE FINKELSTEIN indicated Amendment 1 was a correcting             
 amendment in response to APOC's request for a change in the                   
 percentage as it applied to when the name of a candidate had to be            
 included in the name of a group.  "So, that was changed but we also           
 mistakenly changed it in another place that is unrelated," he said.           
 "This just corrects that."                                                    
                                                                               
 CHAIRMAN PORTER noted there was a motion to move Amendment 1,                 
 addressing page 23, line 8, and page 23, line 16.                             
                                                                               
 REPRESENTATIVE BUNDE asked if the 50 percent was reflected in                 
 existing law.                                                                 
                                                                               
 REPRESENTATIVE FINKELSTEIN replied that was correct.  "This 50                
 percent we're changing back here ... has to do with when a group is           
 controlled by a candidate, which is a different subject that when             
 the name has to be included in the name of the group."                        
                                                                               
 Number 2340                                                                   
                                                                               
 REPRESENTATIVE VEZEY said the definition of "group" was the most              
 complex aspect of public campaign disclosure law.  The section was            
 fraught with things he considered unconstitutional.  He suggested             
 that what was on page 23 should probably be consistent with what              
 was on page 5.  He thought the 33-1/3 was an absurd standard and              
 said, "I think the standard of more than 50 percent is a clearer              
 line."                                                                        
                                                                               
 CHAIRMAN PORTER referred to the section on page 5 and said that in            
 the previous rendition, if a group spent more than 50 percent of              
 its money on the activities of one issue or one candidate, they               
 were required to have that issue or candidate in their name.                  
                                                                               
 REPRESENTATIVE VEZEY clarified that was only for a candidate.                 
                                                                               
 CHAIRMAN PORTER said, "What we're saying is we want to move that to           
 33-1/3 percent, considering ... that somebody could kind of defeat            
 the purpose by spending 40 percent of their money on one issue."              
                                                                               
 Number 2462                                                                   
                                                                               
 MS. MILES explained that the section on page 5 was a naming                   
 convention for a group spending 50 percent, under the existing                
 language, or 33-1/3 percent, under the new language, on one                   
 candidate.                                                                    
                                                                               
 TAPE 96-40, SIDE B                                                            
 Number 0001                                                                   
                                                                               
 MS. MILES expressed that it was not the commission's intention to             
 alter the language found on page 23, which constituted what a                 
 "controlled group" was.  "A controlled group should remain at least           
 ... at 50 percent or more," she said, "because a contribution to a            
 controlled group is just the same as a contribution to the                    
 candidate."  She cited an example in the legislature, saying, "A              
 person who gives a maximum contribution to Republicans to Dave                
 Donley could not also give a contribution to the Citizens for Dave            
 Donley.  So, we wouldn't want that to be any less than 50 percent."           
 She concluded, "If it's too confusing to have a different level for           
 the naming convention and for the controlled group, then it would             
 be the commission's preference that they both remain at 50                    
 percent."                                                                     
                                                                               
 Number 0056                                                                   
                                                                               
 REPRESENTATIVE VEZEY referred to paragraph (B), line 1-19, page 23,           
 and asked whether Ms. Miles was saying that was basically in                  
 existing law.                                                                 
                                                                               
 MS. MILES replied, "Basically, under existing law, a group that               
 spends more than 50 percent of its money on behalf of one candidate           
 is a controlled group.  It's a group that's considered to be                  
 controlled by that candidate and then is joined together, for                 
 purposes of the contribution limit, as one and the same."                     
                                                                               
 REPRESENTATIVE VEZEY responded, "But I'm not aware of any wording             
 like this in statute or regulation."                                          
                                                                               
 MS. MILES said although it was in current statute, she did not have           
 that statute with her.                                                        
                                                                               
 REPRESENTATIVE VEZEY referred to page 21 and suggested this was               
 creating new definitions.                                                     
                                                                               
 MS. MILES responded, "Right.  This is defining `group,' which is              
 currently defined under regulation and statute."                              
                                                                               
 Number 0108                                                                   
                                                                               
 REPRESENTATIVE VEZEY expressed that, according to his                         
 interpretation of current supreme court rulings relating to                   
 campaign expenditures, this definition would not stand up to                  
 supreme court scrutiny as far as what independent expenditure                 
 groups could do.                                                              
                                                                               
 MS. MILES clarified that independent expenditures were a different            
 issue.                                                                        
                                                                               
 REPRESENTATIVE VEZEY said, "But you are trying to take an                     
 independent group and create a statutory definition for a                     
 controlled group."  He clarified that by "you" he did not mean Ms.            
 Miles.  He was not familiar with current statutory wording that               
 defined when a group became a controlled group, he said.  That had            
 been defined through court cases but not clearly in statute.                  
                                                                               
 MS. MILES replied, "Right.  Under current statute, I think, it's              
 any combination of two or more individuals acting jointly to bring            
 money into the group is a group."                                             
                                                                               
 REPRESENTATIVE VEZEY said he was not aware of any statutory                   
 definition of controlled group.                                               
                                                                               
 Number 0163                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN indicated they were discussing a                   
 different subject, on page 5, which might be appropriate for                  
 another amendment.  However,  Amendment 1 corrected something                 
 changed inadvertently and was purely technical, he said.                      
                                                                               
 CHAIRMAN PORTER referred to page 5 and asked:  "Why don't we want             
 to say that if you spend more than a third, then that is the                  
 purpose of your group?"                                                       
                                                                               
 Number 0216                                                                   
                                                                               
 MS. MILES responded, "I believe that it's the commission's position           
 that that's really at too low of a level and again, keeping in mind           
 that this is now changing the contribution limit to $500 from an              
 individual, so a person who gave $500 to a group that spent one-              
 third of its money on one candidate could then not make a                     
 contribution to the candidate."  She suggested it might be better             
 to change both the naming convention and the controlled group                 
 definition back to 50 percent, if that was clearer.                           
                                                                               
 CHAIRMAN PORTER suggested they should do one or the other.                    
                                                                               
 REPRESENTATIVE FINKELSTEIN said, "I don't disagree with you, Mr.              
 Chairman, at all about this.  I was just trying to follow the                 
 commission's recommendation here.  But I don't think there's any              
 real reason that a controlled group shouldn't be at 33-1/3                    
 percent."  He acknowledged that the argument could be made the                
 other way, as well.  He explained that he had tried not to get into           
 controversial areas not covered by the initiative.  "It just says             
 that existing law prevails," he added.                                        
                                                                               
 CHAIRMAN PORTER asked if that was what the amendment did.                     
                                                                               
 REPRESENTATIVE FINKELSTEIN affirmed that.                                     
                                                                               
 Number 0280                                                                   
                                                                               
 CHAIRMAN PORTER pointed out that it was changed to 33-1/3 percent             
 in Section 5.  With this amendment, he thought it would still be              
 inconsistent.                                                                 
                                                                               
 REPRESENTATIVE FINKELSTEIN responded with an example, saying that             
 a group that gave 51 percent to one candidate would be counted as             
 part of that candidate's campaign and the candidate could be                  
 considered controlled by that group.  However, if the group gave 50           
 percent to two different candidates, there would be a question as             
 to whose campaign they would be counted as part of.                           
                                                                               
 CHAIRMAN PORTER said they would have to make up their minds,                  
 because under Section 5, if they spent 33-1/3 percent on one                  
 person, they had to put that name in the title of their group.                
                                                                               
 REPRESENTATIVE FINKELSTEIN indicated there could be a circumstance            
 where two names would be in the title.  He said the issue was                 
 whether they were really independent groups or controlled by                  
 somebody.                                                                     
                                                                               
 Number 0360                                                                   
                                                                               
 CHAIRMAN PORTER commented that he understood, after hearing the               
 debate, the rationale for passing the amendment and having                    
 inconsistency in the numbers.  However, someone could read the bill           
 and be confused by the different standards.  He asked if there was            
 further discussion or an objection to Amendment 1.  There being no            
 objection, Amendment 1 passed.                                                
                                                                               
 Number 0405                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 2 in response to a               
 memo from Jack Chenoweth requesting for the change because of an              
 internal inconsistency in the bill.  The House State Affairs                  
 Committee had decided to allow limited contributions from groups to           
 other groups.  However, separate provisions said campaign money               
 would not be given to groups.  Amendment 2 corrected that and made            
 it internally consistent.  Amendment 2 to CSHB 368(STA) read:                 
                                                                               
      Page 13, Line 23, after "(a)"                                            
           Delete:  "Campaign"                                                 
           Insert:  "Except as otherwise provided, campaign"                   
                                                                               
      Page 14, Line 1, after "fine"                                            
           Insert:  "or"                                                       
                                                                               
      Page 14, Lines 10-11                                                     
           Delete:  ";or"                                                      
           (7) used to make contributions to another candidate or to           
      a group."                                                                
           Insert a new subsection to read:                                    
           "(c) Campaign contributions held by a candidate may not             
      be contributed to another candidate or to a group"                       
                                                                               
 CHAIRMAN PORTER asked if Amendment 2 left it unequivocal that a               
 group could not give money to another group.                                  
                                                                               
 Number 0432                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN replied, "No.  It actually goes with the           
 State Affairs Committee approach which says groups can give to                
 other groups, up to a $1,000 limit in the case of groups and                  
 unlimited within parties."                                                    
                                                                               
 REPRESENTATIVE BUNDE indicated he would have an amendment regarding           
 that section.                                                                 
                                                                               
 CHAIRMAN PORTER pointed out that Representative Bunde's amendment             
 did not deal with campaign money from group to group.                         
                                                                               
 REPRESENTATIVE BUNDE agreed it was from one campaign to another.              
 However, it applied when a person was no longer a candidate, he               
 said.                                                                         
                                                                               
 Number 0538                                                                   
                                                                               
 CHAIRMAN PORTER referred to page 13, line 27, and said, "The lead-            
 in statement is, `Campaign contributions held by a candidate or               
 group may not be' and we're adding `(7) used to make contributions            
 to another candidate or to a group.'"                                         
                                                                               
 REPRESENTATIVE FINKELSTEIN clarified, "That's meant to say delete             
 there.  It says "delete `or [(7)] used to make contributions to               
 another candidate or to a group.' and then insert.  So, it's                  
 deleting (7) with this amendment."                                            
                                                                               
 Number 0583                                                                   
                                                                               
 CHAIRMAN PORTER asked, if the amendment passed, what the monetary             
 limit would be for a group giving money to a group.                           
                                                                               
 REPRESENTATIVE FINKELSTEIN replied "$1,000."  Party to party, the             
 amount was unlimited.                                                         
                                                                               
 CHAIRMAN PORTER asked what the bill now provided for party to                 
 party.                                                                        
                                                                               
 REPRESENTATIVE FINKELSTEIN said, "Zero."  He added that it depended           
 on how it was defined.                                                        
                                                                               
 Number 0614                                                                   
                                                                               
 REPRESENTATIVE BUNDE referred to page 14, line 11, and said he                
 understood that groups could contribute group to group.                       
                                                                               
 CHAIRMAN PORTER added, "Because we've eliminated number (7) above             
 there, which precluded it.  So groups can give to groups to the               
 limit of $1,000."  He asked how it affected what a party could do.            
                                                                               
 REPRESENTATIVE VEZEY responded, "A party, as defined in APOC                  
 statutes, is a group."  He noted there were two contributors in               
 Alaska statutes, individuals and groups.  "You fall into one or the           
 other category," he said.                                                     
                                                                               
 Number 0657                                                                   
                                                                               
 CHAIRMAN PORTER suggested the bill changed that to three                      
 categories.                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN clarified that intra-party activity was            
 allowed.  Amendment 2 was a technical amendment to fix an                     
 inconsistency that could have been interpreted to disallow that               
 kind of group transfer.                                                       
                                                                               
 CHAIRMAN PORTER specified it was group transfers, not party                   
 transfers.                                                                    
                                                                               
 REPRESENTATIVE FINKELSTEIN referred to (7), which said, "used to              
 make contributions to another candidate or to a group".  He                   
 explained, "If that wasn't fixed, it ... might have precluded those           
 group transfers or party transfers."                                          
                                                                               
 REPRESENTATIVE TOOHEY stated, "What he's saying is a party and a              
 group are two different things."                                              
                                                                               
 REPRESENTATIVE FINKELSTEIN indicated Representative Vezey was                 
 right.  Although all parties were groups, not all groups were                 
 parties.                                                                      
                                                                               
 Number 0716                                                                   
                                                                               
 CHAIRMAN PORTER asked, if the bill passed, whether the statute                
 would remain the same, with just groups and parties.                          
                                                                               
 MS. MILES replied, "Essentially, yes.  A party is always a group.             
 But a party is a group with special dispensation for greater                  
 contributions and also greater ... unlimited interaction between a            
 statewide party and its subdivisions."                                        
                                                                               
 REPRESENTATIVE BUNDE asked, if this amendment was accepted, whether           
 a legislator would be prohibited from contributing to another                 
 legislator out of campaign funds.                                             
                                                                               
 REPRESENTATIVE FINKELSTEIN responded that was already precluded by            
 (7).                                                                          
                                                                               
 CHAIRMAN PORTER said, "Basically, without the amendment, that would           
 be precluded.  We're taking out language that precludes both party            
 to party and campaign to campaign, and leaving campaign to campaign           
 or candidate to candidate," he said.                                          
                                                                               
 Number 0778                                                                   
                                                                               
 REPRESENTATIVE BUNDE opposed Amendment 2.                                     
                                                                               
 CHAIRMAN PORTER asked whether Representative Bunde thought groups             
 should not be able to give money to each other.                               
                                                                               
 REPRESENTATIVE FINKELSTEIN referred to a letter dated March 12,               
 1996, from Jack Chenoweth to Chairman Porter, which said Mr.                  
 Chenoweth had made a minor error in two provisions that now                   
 conflicted and needed correction.  Representative Finkelstein                 
 stated, "If the person objecting wants to propose a substantive               
 amendment, that's fine, we can discuss it.  But I'm doing nothing             
 more here than trying to fix a minor drafting matter."                        
                                                                               
 Number 0814                                                                   
                                                                               
 REPRESENTATIVE VEZEY moved to amend Amendment 2 by deleting the               
 last five lines and inserting a new subsection.  "Just delete from            
 `insert a new subsection' down," he said.                                     
                                                                               
 CHAIRMAN PORTER objected for the purpose of discussion.                       
                                                                               
 REPRESENTATIVE VEZEY expressed that he had serious concerns and               
 suggested someone be brought in to consult with the committee on              
 the bill.  He questioned its constitutionality as to campaign                 
 expenditures and believed it had philosophical flaws.                         
                                                                               
 CHAIRMAN PORTER emphasized the goal of crafting legislation that              
 did not vary from the nature of the initiative, as opposed to                 
 crafting legislation that he liked.  He asked if candidate-to-                
 candidate contribution from campaign funds was precluded in the               
 initiative.                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN said that was correct.  He emphasized              
 the technical nature of the amendment and indicated that amending             
 the amendment would create a new conflict.                                    
                                                                               
 Number 0960                                                                   
                                                                               
 REPRESENTATIVE VEZEY withdrew his amendment to Amendment 2.                   
                                                                               
 CHAIRMAN PORTER asked members with substantive concerns to draft              
 amendments with Mr. Chenoweth for presentation at the next meeting.           
                                                                               
 REPRESENTATIVE FINKELSTEIN requested that he and Representative               
 James receive a copy of any proposed amendments.                              
                                                                               
 CHAIRMAN PORTER asked if there was further discussion or an                   
 objection to Amendment2.  There being none, Amendment2 passed.                
                                                                               
 Number 1023                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 3 to CSHB 368(STA),              
 which read:                                                                   
                                                                               
                                                                               
      Page 5, Lines 10-11                                                      
           Delete:  An individual may make a contribution to a group           
      or to a political party."                                                
           Insert:  "Only an individual may make a contribution to             
      a group or political party.  Only individuals, groups or                 
      political parties may make contributions to a candidate."                
                                                                               
      Page 6, Line 20:                                                         
           Delete:  "an individual or group"                                   
           Insert:  "a person"                                                 
                                                                               
 REPRESENTATIVE FINKELSTEIN explained Amendment 3 conformed to the             
 initiative and the Senate bill.  The initiative said individuals              
 made contributions to groups or parties; individuals, groups and              
 parties made the contributions to a candidate.  "What we're trying            
 to do is make something that's easily understood without having to            
 read every provision together," he said.                                      
                                                                               
 CHAIRMAN PORTER noted that as a motion to move Amendment 3.                   
                                                                               
 Number 1064                                                                   
                                                                               
 REPRESENTATIVE VEZEY objected and asked for an explanation.                   
                                                                               
 REPRESENTATIVE FINKELSTEIN responded, "Right now, it says an                  
 individual may make a contribution to a group or to a political               
 party, on page 5, lines ... 10-11.  [At] later points, we limit               
 what can be given to a candidate ... but there's never one place              
 set in clear language what that limit is."  He said the bottom                
 change was technical.  "There are entities other than individuals             
 or groups," he said, indicating there was an amendment coming up              
 that fixed all the "persons" and "individuals"  throughout the                
 bill.                                                                         
                                                                               
 Number 1141                                                                   
                                                                               
 REPRESENTATIVE VEZEY maintained his objection.  Regardless of the             
 wording being directly out of the initiative, the legislature was             
 obliged to write statutes that conformed to established law and               
 would stand up to constitutional scrutiny, he said.  He believed              
 the initiative was so fraught with constitutional problems that               
 Alaska's law would be in flux for 10-20 years if it passed.  "I do            
 think that we have an obligation to go through this and try to                
 bring the statute in conformity to the state of the law as it                 
 exists today," he said.                                                       
                                                                               
 Number 1202                                                                   
                                                                               
 CHAIRMAN PORTER said the amendment made it purely clear that a                
 business could not give money.  Although he did not personally                
 agree with that, it was the provision of the initiative.  "Again,             
 if we wanted to debate that issue, let's get an amendment that                
 specifically does all of that," he suggested.                                 
                                                                               
 REPRESENTATIVE VEZEY viewed the amendment as being broader than               
 that.  "[I]t also says `only an individual' excludes groups," he              
 said.                                                                         
                                                                               
 Number 1290                                                                   
                                                                               
 CHAIRMAN PORTER agreed an individual and a group were distinct                
 entities.                                                                     
                                                                               
 REPRESENTATIVE JAMES asked:  "Didn't we just say that groups could            
 give money to groups, and now we're saying only individuals can               
 give money to groups?"                                                        
                                                                               
 REPRESENTATIVE VEZEY said, "And this does not say that a business             
 cannot give a contribution, because a business can be defined as a            
 group."                                                                       
                                                                               
 REPRESENTATIVE JAMES concurred.                                               
                                                                               
 REPRESENTATIVE VEZEY stated that only individual groups or                    
 political parties may make contributions to a candidate.                      
                                                                               
 CHAIRMAN PORTER agreed.  "We just said that a group could give                
 money to a group and now we're just specifically saying they                  
 can't," he added.                                                             
                                                                               
 Number 1327                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN explained the language came from the               
 Senate bill before another change was made.  He offered to try                
 again on the amendment and said the intention was only to correct             
 the language in that particular place.                                        
                                                                               
 CHAIRMAN PORTER noted they were withdrawing Amendment 3 and would             
 work on it next time.  He suggested also thinking about why a group           
 would want to give money to a group in the first place.                       
                                                                               
 REPRESENTATIVE VEZEY commented that he wanted to bring in an expert           
 to advise the committee.  He suggested the issue had been around              
 ever since Watergate and that there were thousands of court cases             
 defining what was allowed or prohibited in those areas.                       
                                                                               
 Number 1439                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN said at least four opinions had been               
 offered in writing to the legislature.  "If you read them all, the            
 conclusion you come to is that, in general, this initiative has               
 avoided the areas that are explicitly unconstitutional," he said.             
 "But there's also many of them that are not explicitly                        
 constitutional."  He noted that the one being discussed was least             
 likely to have a problem because the federal government, as well as           
 the majority of states, banned contributions except from                      
 individuals.                                                                  
                                                                               
 Number 1514                                                                   
                                                                               
 REPRESENTATIVE VEZEY referred to the 1936 federal election campaign           
 reform which outlawed contributions from corporations, labor unions           
 and other entities.  In so doing, he said, they created the "PAC"             
 or political action committee, a group formed to contribute for               
 other entities.   Businesses and labor unions still contributed,              
 but in the name of a PAC.                                                     
                                                                               
 REPRESENTATIVE FINKELSTEIN thought that was incorrect and said,               
 "Only individual contributions are allowed to those groups."                  
                                                                               
 Number 1575                                                                   
                                                                               
 REPRESENTATIVE VEZEY replied there were limitations on the money              
 that could go into PACs.  But the federal government, when it                 
 created the ban on contributions by labor unions and corporations,            
 created the PACs.                                                             
                                                                               
 CHAIRMAN PORTER pointed out that the source of funds contributed by           
 the PAC was totally different from that contributed by a business.            
 "A business can contribute from business funds," he said.  "There's           
 a total prohibition in this initiative, and in the federal law,               
 from that happening.  The PACs must have their contributions from             
 individuals."                                                                 
                                                                               
 REPRESENTATIVE VEZEY interjected, "All of whom can be employees of            
 the business."                                                                
                                                                               
 Number 1625                                                                   
                                                                               
 CHAIRMAN PORTER agreed.  "And this is, of course, a proof problem,            
 but if it is determined that the business is giving money to                  
 employees with the expectation that that money is to be given to a            
 certain candidate, that is a violation of federal law," he said.              
                                                                               
 REPRESENTATIVE FINKELSTEIN added, "And in existing state law."  He            
 mentioned there had been prosecutions over that provision.                    
                                                                               
 REPRESENTATIVE VEZEY indicated that federal law clearly provided              
 for payroll deductions for PACs.                                              
                                                                               
 CHAIRMAN PORTER replied, "But the PAC cannot be a PAC for a                   
 candidate.  It is just a PAC for the organization.  Then they get             
 together and decide how it is they want to distribute their funds.            
 But that is a total violation of the law if it is determined that             
 all of those funds, 33-1/3 percent or 50 percent or however they've           
 got their statute written, [are] going to one place."                         
                                                                               
 Number 1679                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN commented that while it seemed new,                
 because it had not been seen in Alaska, it was not unusual.                   
 However, there were unusual provisions in the bill, such as the               
 lobbyist provision, which were the ones most likely to be subject             
 to constitutional challenge, he said.                                         
                                                                               
 Number 1736                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN moved Amendment 4 to CSHB 368(STA),                
 which read:                                                                   
                                                                               
      Page 15, Lines 10-12                                                     
           Delete                                                              
                "(6) repay contributions to contributors, but only             
           if repayment of the contribution is made to all                     
           contributors pro rata in approximate proportion to the              
           contributions made;"                                                
                                                                               
           Insert                                                              
                 "(6) repay contributions to contributors, but only            
          if repayment of the contribution is made pro rata in                 
          approximate proportion to the contributions made using one           
          of the following, as the candidate determines:                       
                     (A) to all contributors;                                  
                     (B) to contributors who have made contributions           
          most recently;                                                       
          or                                                                   
                     (C) to contributors who have made larger                  
          contributions;"                                                      
                                                                               
 REPRESENTATIVE FINKELSTEIN explained Amendment 4 expanded what                
 could be done with excess campaign funds.  The previous bill said             
 money could be given to contributors in a pro rata manner.  "There            
 was an expression that would be too hard, because maybe it would              
 make more sense just to give to the most recent contributors or               
 only to people who have given larger contributions.  So, this                 
 allows all those options."  He expressed it was a minor provision             
 because it seldom happened.                                                   
                                                                               
 CHAIRMAN PORTER noted the motion to move Amendment 4 and asked if             
 there was an objection.                                                       
                                                                               
 Number 1789                                                                   
                                                                               
 REPRESENTATIVE VEZEY objected for purposes of discussion and asked            
 for a rationale.                                                              
                                                                               
 REPRESENTATIVE FINKELSTEIN said the concern expressed in previous             
 committees was that it precluded, for example, just giving the                
 money back to the most recent contributors.  Not giving it to the             
 smallest contributors, to avoid accounting and distribution                   
 hassles, might not have been allowed, either.  The amendment                  
 clarified that money could be returned in any of those ways.                  
                                                                               
 CHAIRMAN PORTER indicated there was a whole list of other things              
 that could be done with the money, including giving it to charities           
 or repaying loans.  This expanded methods for giving it back to               
 contributors, however.                                                        
                                                                               
 REPRESENTATIVE VEZEY withdrew his objection.                                  
                                                                               
 CHAIRMAN PORTER asked if there was any further objection to                   
 Amendment 4.  There being none, Amendment 4 passed.                           
                                                                               
 Number 1889                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 5 to CSHB 368(STA),              
 which read:                                                                   
                                                                               
      Page 16, Line 9:                                                         
           Delete:  "The total value of the property retained may              
      not exceed $2,500."                                                      
           Insert:  "The current fair market value of the property             
      retained may not exceed a total of $2,500."                              
                                                                               
 REPRESENTATIVE FINKELSTEIN explained a concern had been expressed             
 that the value was not purchase price.  He said the initiative                
 always had intended that.                                                     
                                                                               
 CHAIRMAN PORTER asked if there was discussion or an objection to              
 Amendment 5.  There being none, Amendment 5 passed.                           
                                                                               
 Number 1935                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 6 to CSHB 368(STA),              
 which read:                                                                   
                                                                               
      Page 25, Line 25:                                                        
           Delete:  "AS 15.56.014(a)"                                          
           Insert:  "AS 15.56.012"                                             
                                                                               
 REPRESENTATIVE FINKELSTEIN noted that Amendment 6 just fixed a                
 mistake in drafting.  In the provisions of the initiative, a person           
 found guilty of the highest level of penalty, the first degree,               
 would lose his or her business license.  As written in the bill, a            
 person would no longer lose a business license for a first-degree             
 offense but would lose it for a second-degree offense.  The                   
 amendment moved it back to the first degree, so that only the                 
 highest level of penalty, for the actual intentional violation,               
 could result in losing a business license for a year.                         
                                                                               
 Number 1980                                                                   
                                                                               
 CHAIRMAN PORTER asked if there was discussion or an objection to              
 Amendment 6.                                                                  
                                                                               
 REPRESENTATIVE VEZEY objected and asked for time to review it.                
                                                                               
 REPRESENTATIVE FINKELSTEIN clarified the question was whether                 
 losing a business license should be for the highest-level                     
 violation, as in the initiative, or for a lower-level violation.              
 He said for the highest level of violation, a person had to                   
 intentionally break the law.                                                  
                                                                               
 CHAIRMAN PORTER asked what AS 15.56.012 was.                                  
                                                                               
 REPRESENTATIVE FINKELSTEIN replied that was the first degree.                 
                                                                               
 Number 2080                                                                   
                                                                               
 CHAIRMAN PORTER said it was in the bill on page 24, line 9.  He               
 asked why, if a campaign prohibition was violated, a person would             
 lose a business license.                                                      
                                                                               
 REPRESENTATIVE BUNDE speculated that if a business was violating              
 it, this would be an attempt to impose an additional penalty.                 
                                                                               
 Number 2128                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN agreed it was an interesting subject but           
 pointed out the amendment was purely technical.  "Even if you                 
 didn't believe in it, you'd certainly want it to apply only to the            
 highest level penalty," he said.                                              
                                                                               
 CHAIRMAN PORTER suggested the committee write that down for future            
 consideration.  He asked if there was further discussion or an                
 objection to Amendment 6.  There being none, Amendment 6 passed.              
                                                                               
 Number 2212                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 7 to CSHB 368(STA),              
 which read:                                                                   
                                                                               
      Page 7, Line 6 after "representative"                                    
           Insert:  ", or municipal or other office"                           
                                                                               
 REPRESENTATIVE FINKELSTEIN said that while in the initiative                  
 prohibited money from out of state, the bill allowed minor amounts.           
 The intention was to allow family members to contribute.  However,            
 there was no provision for municipal or other offices.  The                   
 question was whether someone running for a municipal office should            
 be allowed a minor amount of out-of-state money.                              
                                                                               
 CHAIRMAN PORTER asked if there was discussion or an objection.                
                                                                               
 Number 2267                                                                   
                                                                               
 REPRESENTATIVE VEZEY asked if, as currently written, there was a              
 limit on the contribution to a municipal or other office.                     
                                                                               
 CHAIRMAN PORTER replied there was an absolute prohibition from out            
 of state.                                                                     
                                                                               
 REPRESENTATIVE VEZEY noted Amendment 7 was trying to add "municipal           
 or other office" to the $2,000 contribution from a party, from out            
 of state.                                                                     
                                                                               
 CHAIRMAN PORTER commented that without this, people running for               
 municipal or other office would not be able to receive a limited              
 contribution from out of state, as people running for state office            
 were allowed to do.                                                           
                                                                               
 REPRESENTATIVE VEZEY asked if this was a substantive amendment.               
                                                                               
 REPRESENTATIVE FINKELSTEIN replied, "Absolutely."                             
                                                                               
 REPRESENTATIVE VEZEY asked Chairman Porter if he preferred to                 
 discuss the concept later.                                                    
                                                                               
 CHAIRMAN PORTER said yes and indicated he was writing down topics             
 for consideration.  Recognizing that the committee was voting on              
 the amendment, not the issue, he asked if there was any objection             
 to Amendment 7.  There being none, Amendment 7 passed.                        
                                                                               
 Number 2450                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 8 to CSHB 368(STA),              
 which read:                                                                   
                                                                               
      Page 24, Line 21 after "(2)"                                             
           Insert:  "except as provided in AS 15.13.090(b),"                   
                                                                               
 REPRESENTATIVE FINKELSTEIN referred to a court decision called the            
 McIntyre case, to which Amendment 8 attempted to conform Alaska law         
 by not requiring filing or paid-for-by statements from an                     
 individual who tried to affect a campaign with signs or other                 
 means.                                                                        
                                                                               
 TAPE 96-41, SIDE A                                                            
 Number 0001                                                                   
                                                                               
 CHAIRMAN PORTER asked if there was discussion or any objection to             
 Amendment 8.  There being none, Amendment 8 passed.                           
                                                                               
 Number 0059                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 9 to CSHB 368(STA),              
 which read:                                                                   
                                                                               
      Page 13, line 6:                                                         
           Delete "expenditures from"                                        
           Insert "all amounts expended from"                                
                                                                               
      Page 16, line 1:                                                         
           Delete "the expenditures made"                                      
           Insert "all amounts expended"                                       
                                                                               
 REPRESENTATIVE FINKELSTEIN explained that unlike the initiative,              
 the bill allowed a limited amount of money to go into a legislative           
 office account, with caps.  In doing so, it required that any                 
 expenditures from that account be reported publicly.  In using the            
 word "expenditures", they had discovered that the commission had a            
 specific definition for "expenditures".  The English word was                 
 intended, not that definition.  The amendment was purely technical,           
 he added.                                                                     
                                                                               
 Number 0120                                                                   
                                                                               
 REPRESENTATIVE VEZEY objected, saying, "I'm not sure that we want             
 to address all amounts expended."                                             
                                                                               
 REPRESENTATIVE FINKELSTEIN indicated if that approach was accepted,           
 there would be no reporting because no campaign expenditures                  
 occurred out of the office account.  The concept was that if                  
 campaign funds were converted to an office account, which was                 
 essentially a category of personal funds, a person should disclose            
 what happened to that money, so it could not be interpreted that              
 personal use was made of those funds, he said.                                
                                                                               
 Number 0199                                                                   
                                                                               
 REPRESENTATIVE VEZEY pointed out that expenses from legislative               
 office accounts were public records.                                          
                                                                               
 CHAIRMAN PORTER disagreed and said his were not.                              
                                                                               
 REPRESENTATIVE VEZEY indicated there were two ways of operating and           
 said apparently Chairman Porter had used the method where                     
 Legislative Affairs wrote a single check to him.  "That is a public           
 record," he said.                                                             
                                                                               
 CHAIRMAN PORTER stated that how he spent those funds was not a                
 public record and briefly discussed office accounts.  He referred             
 to page 13, line 6, the language "including, if applicable,                   
 expenditures".  He suggested that meant that if he took money from            
 his campaign and put it into his account, he would have to report             
 how he spent it, not that he put it in there.  "But it still                  
 doesn't change the rules on the rest of the money that I got from             
 the state," he added.                                                         
                                                                               
 Number 0389                                                                   
                                                                               
 REPRESENTATIVE JAMES said, "If you put money into an account and              
 you already had money in there, or you put some other money in                
 there, there's absolutely no way to identify how much of that money           
 you spent in that account.  You're going to have to report the                
 account and where the money came from."                                       
                                                                               
 REPRESENTATIVE VEZEY stated, "We're saying the same thing, except             
 that I submit that the fact that you have taken moneys in your                
 legislative office account as personal income is a reportable item.           
 ... That is a public record.  If we leave the wording as it is, I             
 would interpret that as being, 1) illegal and 2) if it was legal,             
 that you would then be required to report expenditures, as opposed            
 to all funds expended, which is a difference.  However, if a person           
 decides to ... put $10,000 into their legislative office account,             
 they could take out the $6,000 that the state put in there, ...               
 leave $10,000 in there and report the expenses of that.  They could           
 take all $16,000 out as personal income and report it to the IRS,             
 but I think under the statute, they'd be breaking the law to do               
 that.  But if they did, if it was legal under the statute, you                
 would then be required to report the expenditures, as defined under           
 the APOC statutes."  He added that was his interpretation of the              
 existing wording.                                                             
                                                                               
 REPRESENTATIVE VEZEY referred to the proposed wording and said,               
 "You would then be required, if you put any campaign money into               
 your office account and took any amount as personal income, you               
 would then have to ... account for every dollar of both the                   
 personal income and the office account moneys."                               
                                                                               
 Number 0536                                                                   
                                                                               
 CHAIRMAN PORTER indicated Representative James's understanding was            
 not quite right.  "If it's in there, the report that I would have             
 to make would be a report on how I spent that amount of money.                
 Whether it was `the money' or other money wouldn't make any                   
 difference."  He added, "I would have to explain expenditures up to           
 the amount of the money that I drew from campaign."                           
                                                                               
 REPRESENTATIVE FINKELSTEIN concurred.  "And if people felt there              
 was a problem, they always have the option of setting up a separate           
 account," he said.  He emphasized it was a technical amendment and            
 reiterated, "We meant its English version, not its definitional               
 version."                                                                     
 REPRESENTATIVE BUNDE understood that if a person were challenged by           
 someone else or by APOC, an accounting of how checks had been                 
 written would be required.  He asked Ms. Miles if that was correct.           
                                                                               
 Number 0634                                                                   
                                                                               
 MS. MILES clarified, "Under current law, if you took money out of             
 your campaign as income, you report that; that's that.  That's all            
 you have to report to APOC."                                                  
                                                                               
 REPRESENTATIVE VEZEY commented, "This statute clearly says that               
 we're talking about the legislative office account established                
 under current law.  There can only be one of those."                          
                                                                               
 REPRESENTATIVE FINKELSTEIN replied, "This doesn't say that."                  
                                                                               
 REPRESENTATIVE VEZEY asked about AS 15.13.(indisc.).                          
                                                                               
 REPRESENTATIVE FINKELSTEIN said, "That's just the one in the bill.            
 That's the new one that's the opportunity to transfer money.  And             
 this is only the part that's not the other office account.  This is           
 just excess campaign funds."                                                  
                                                                               
 Number 0683                                                                   
                                                                               
 REPRESENTATIVE VEZEY asked if Representative Finkelstein was saying           
 that, under this statute, a person could have more than one                   
 legislative office account.                                                   
                                                                               
 CHAIRMAN PORTER indicated that was right.                                     
                                                                               
 REPRESENTATIVE FINKELSTEIN said, "Well, you could have a hundred if           
 you want."                                                                    
                                                                               
 REPRESENTATIVE VEZEY thought that still strengthened the fact that            
 reporting should be limited to expenditures.  "Only the funds that            
 would reported as an expenditure, as defined by APOC, really are              
 applicable," he said, adding that if the bill became statute, he              
 thought it would be imprudent of a person to mix the accounts.                
                                                                               
 REPRESENTATIVE FINKELSTEIN said, "The expenditures definition is              
 unrelated to what you'd use an office account for.  It's about                
 campaign expenses.  Using that definition for expenditures from an            
 office account would be illogical."  He explained, "It's just a               
 word-play thing that happened.  This is supposed to say money that            
 comes from this account, you're going to report what happens to               
 it."  He added that although policies could be debated, the                   
 amendment was not about those policies but merely fixed a technical           
 error.                                                                        
                                                                               
 Number 0772                                                                   
                                                                               
 MS. MILES agreed it was only a word problem.  "Expenditures is                
 defined in this chapter on page 22 at line 15," she said.  "And               
 under ... these new ideas for campaign finance, expenditures are              
 going to have to ... be reasonably connected to a campaign to be              
 considered.  And that's why that's the wrong word for moneys that             
 are transferred to an office account and then are spent for your              
 official legislative ... activities."                                         
                                                                               
 CHAIRMAN PORTER asked if there was further discussion and whether             
 the objection was maintained.                                                 
                                                                               
 REPRESENTATIVE VEZEY maintained his objection.                                
                                                                               
 Number 0811                                                                   
                                                                               
 CHAIRMAN PORTER asked for a roll call vote on Amendment 9.  Voting            
 against the amendment were Representatives Toohey and Vezey.                  
 Voting for the amendment were Representatives B. Davis,                       
 Finkelstein, Bunde and Porter.  Representative Green was absent.              
 Chairman Porter noted that Amendment 9 passed.                                
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 10 to CSHB 368(STA),             
 which made the following changes:                                             
                                                                               
 Page 6, line 17:  Delete "a person" and insert "an individual"                
 Page 6, line 18:  Delete "the person" and insert "that individual"            
 Page 6, line 28:  Delete "a person" and insert "an individual"                
 Page 6, line 29:  Delete "the person" and insert "that individual"            
 Page 7, line 1:   Delete "person" and insert "individual"                     
 Page 7, line 3:   Delete "person" and insert "individual"                     
 Page 7, line 5:   Delete "person" and insert "individual"                     
 Page 7, line 7:   Delete "a person" and insert "an individual"                
 Page 7, line 8:   Delete "the person" and insert "that individual"            
 Page 7, line 10:  Delete all material and insert:                             
           "(d) An individual, or one acting directly or indirectly            
      on behalf of that individual,"                                           
 Page 7, line 16:  Delete "a person" and insert "an individual"                
 Page 7, line 17:  Delete "the person" and insert "that individual"            
 Page 7, line 19:  Delete "person" and insert "individual"                     
 Page 7, line 22, after "person":  Insert "or group"                           
 Page 7, line 24, after "person":  Insert "or group"                           
 Page 7, line 26, after "person":  Insert "or group"                           
 Page 7, line 27:  Delete "a person" and insert "an individual"                
 Page 7, line 28:  Delete "the person" and insert "that individual"            
 Page 7, line 32:  Delete "person" and insert "individual"                     
 Page 8, line 3:  Delete "person" and insert "individual"                      
 Page 8, line 6:  Delete "a person" and insert "an individual"                 
 Page 8, line 7:  Delete "the person" and insert "that individual"             
 Page 8, line 10:  Delete "person" and insert "individual"                     
 Page 8, line 13:  Delete "person" and insert "individual"                     
 Page 8, line 16:  Delete "a person" and insert "an individual"                
 Page 8, line 17:  Delete "the person" and insert "that individual"            
 Page 8, line 20:  Delete "person" and insert "individual"                     
 Page 8, line 23:  Delete "person" and insert "individual"                     
 Page 8, line 27:  Delete "person" and insert "candidate or                    
      individual"                                                              
                                                                               
 Page 8, line 29:  Delete "person" and insert "candidate"                      
 Page 9, line 1:   Delete "person" and insert "candidate"                      
 Page 9, line 4:   Delete "person" and insert "candidate"                      
 Page 9, line 6, after "person":  Insert "or group"                            
 Page 9, line 8, after "person":  Insert "or group"                            
                                                                               
 Number 0898                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN noted that the commission had alerted              
 him to issues on the use of the word "person".  "When you say                 
 `person' meaning an individual, it fouls things up because                    
 `persons' are a category that includes individuals, groups, other             
 entities," he said.  "`Persons' is everybody."  Amendment 10 made             
 it clear when it was an individual, he added.                                 
                                                                               
 MS. MILES indicated the commission and its staff had spent a lot of           
 time on this issue.  Because the bill established actions allowed             
 for individuals, who were allowed to contribute, and those                    
 prohibited for persons, meaning corporations, labor unions and                
 entities of that nature, APOC had identified places where the                 
 wording was wrong.                                                            
                                                                               
 Number 0964                                                                   
                                                                               
 CHAIRMAN PORTER asked if there was further discussion or any                  
 objection to Amendment 10.                                                    
                                                                               
 REPRESENTATIVE VEZEY said he understood the difference between a              
 person and an individual but asked what the problem was.  He                  
 referred to page 6, line 17, and said only individuals could file             
 with the commission.                                                          
                                                                               
 CHAIRMAN PORTER replied that a group also had to file with the                
 commission.                                                                   
                                                                               
 REPRESENTATIVE VEZEY concurred.                                               
                                                                               
 REPRESENTATIVE FINKELSTEIN clarified they were not discussing                 
 groups there, just candidates.  "We have to use person there                  
 because candidate doesn't cover everyone," he said, adding that               
 there were individuals who filed like candidates.  "By using                  
 person, we pull someone [in] that we don't mean to pull in there,             
 which is groups."                                                             
                                                                               
 Number 1036                                                                   
                                                                               
 REPRESENTATIVE VEZEY withdrew his objection.                                  
                                                                               
 CHAIRMAN PORTER asked if there was any other objection.  There                
 being none, Amendment 10 passed.                                              
                                                                               
 Number 1066                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 11 to CSHB 368(STA),             
 which read:                                                                   
                                                                               
      Page 17, line 18:                                                        
           Delete "AS 15.13.040(f)"                                            
           Insert "AS 15.13.040(d) - (f), 15.13.050, 15.13.060(b) -          
      (d), 15.13.080(c) [AS 15.13.040(f)]"                                   
                                                                               
           Delete "or 15.13.110(f)"                                            
           Insert ", (e), or (f) [OR AS 15.13.110(f)]"                       
                                                                               
      Page 17, line 24, after "court.":                                        
           Insert "A person who violates a provision of this                 
      chapter, except a provision requiring filing of a report               
      within a time required as otherwise specified in this                  
      subsection, is subject to a civil penalty of not more than             
      $500 as determined by the commission, subject to right of              
      appeal to the superior court."                                         
                                                                               
 REPRESENTATIVE FINKELSTEIN explained that the initiative had a high           
 level of standards for determinants of when civil penalties should            
 be provided, plus a set of standards for aggravating and mitigating           
 factors.  "The House State Affairs Committee took all those out               
 [and] instead, just raised the maximum and left in the existing               
 approach," he said.  Whereas the initiative covered per-day items,            
 with a $50-per-day maximum, this allowed civil penalties for items            
 that were not per-day violations, with a $500 maximum.                        
                                                                               
 Number 1158                                                                   
                                                                               
 CHAIRMAN PORTER asked if there was any discussion or objection.               
 There being none, Amendment 11 passed.                                        
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 12 to CSHB 368(STA),             
 which read:                                                                   
                                                                               
      Page 19, line 30:                                                        
           Delete "a state, municipal, municipal runoff, or federal            
      office"                                                                  
           Insert "a state or municipal office"                                
                                                                               
 Number 1166                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN said Amendment 12 was a point made by              
 the commission in a letter.  "We preclude in here use of state and            
 local funds for trying to affect candidates in a state, municipal             
 or federal race," he explained.  Because the commission had thought           
 federal law might preempt it, the amendment removed "federal                  
 office".  "I doubt that under federal law you'd be able to spend              
 state or municipal money to try to affect the outcome at that                 
 election, anyway," he said.                                                   
                                                                               
 CHAIRMAN PORTER asked if municipal runoff was removed because of              
 being redundant with a municipal office race.                                 
                                                                               
 REPRESENTATIVE FINKELSTEIN affirmed that.                                     
                                                                               
 CHAIRMAN PORTER asked if there was any discussion or objection.               
 There being none, Amendment 12 passed.                                        
                                                                               
 Number 1228                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN noted that the next amendment in the               
 packet was identical to Amendment 1.  Therefore, it was not                   
 offered.  He offered Amendment 13 to CSHB 368(STA):                           
                                                                               
      Page 23, Line 28, after "union":  Insert "and political group"           
                                                                               
 Number 1285                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN explained that page 23, line 28,                   
 contained an odd, antiquated definition of "person".  It cross-               
 referenced the definition in 01.10.060, which included everyone.              
 He said the amendment just made it easier to write the bill.                  
                                                                               
 REPRESENTATIVE VEZEY voiced that "labor union" was redundant.                 
 "There's no reason for having a statutory definition of `person' if           
 we're going to have to go through and think of everybody that we              
 might have left off," he said.  He opposed the amendment for that             
 reason.                                                                       
                                                                               
 Number 1348                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN said he would agree with respect to                
 labor union.                                                                  
                                                                               
 CHAIRMAN PORTER asked if it was language from the initiative.                 
                                                                               
 REPRESENTATIVE FINKELSTEIN indicated it was a drafting matter.  He            
 said the commission's executive director had believed that `group'            
 was not included in `person'.                                                 
                                                                               
 CHAIRMAN PORTER asked if there was further discussion or any                  
 further objection.                                                            
                                                                               
 REPRESENTATIVE VEZEY maintained his objection.                                
                                                                               
 CHAIRMAN PORTER stated the desire to include `political group'                
 under `person'.  "And if the director has a concern about whether             
 that's in there or not, I don't feel put out to make it explicit,"            
 he said.  He asked for a roll call vote on Amendment 13.  Voting              
 against the amendment was Representative Vezey.  Voting for the               
 amendment were Representatives B. Davis, Finkelstein, Bunde and               
 Porter.  Absent were Representatives Green and Toohey.  Chairman              
 Porter noted that Amendment 13 passed.                                        
                                                                               
 Number 1510                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 14 to CSHB 368(STA):             
                                                                               
      Page 4, Line 19:  Delete "election;"                                     
                                                                               
      Page 4, Line 19, after "in seeking":  Insert "statewide or               
      legislative office or $1,000 in seeking municipal or other               
      office;"                                                                 
                                                                               
      Page 4, Line 21:  Delete "election;"                                     
                                                                               
      Page 4, Line 20, after "in seeking":  Insert "statewide or               
      legislative office or $1,000 in seeking municipal or other               
      office;"                                                                 
                                                                               
      Page 4, Line 23:  Delete "election."                                     
                                                                               
      Page 4, Line 22, after "in seeking":  Insert "statewide or               
      legislative office or $1,000 in seeking municipal or other               
      office."                                                                 
                                                                               
 REPRESENTATIVE FINKELSTEIN explained that in existing law, only for           
 expenditures under $1,000 for municipal races would a person                  
 receive an exemption from reporting.  The initiative added state              
 races to that.  The House State Affairs Committee increased that              
 amount to $2,500.  The commission responded that for municipal                
 races, that was too high.  Therefore, the amendment left the amount           
 at $2,500 for state races but kept it at the original $1,000 for              
 municipal races.                                                              
                                                                               
 CHAIRMAN PORTER noted that the amendment had been discussed by Ms.            
 Miles.                                                                        
                                                                               
 REPRESENTATIVE FINKELSTEIN said, "It still is going to lead to a              
 lot more people who don't have to file."                                      
                                                                               
 Number 1565                                                                   
                                                                               
 REPRESENTATIVE VEZEY said he could not see that $2,500 in campaign            
 expenditures was excessive, even for municipal elections.  He                 
 reminded members of inflation that had occurred since the APOC                
 statutes were written in 1974.  He felt people who limited expenses           
 to $2,500 should be relieved of as many reporting burdens as                  
 possible.                                                                     
                                                                               
 REPRESENTATIVE FINKELSTEIN indicated he did not disagree.                     
                                                                               
 MS. MILES said the commission's position was that $2,500 was too              
 high for municipal races.  Outside of the larger communities, there           
 would be no reports available in communities, she said, explaining            
 that although reports were filed with APOC, copies of reports were            
 retained at the city clerk's office for public use.                           
                                                                               
 REPRESENTATIVE VEZEY expressed that $2,500 was minuscule by                   
 anybody's standards.  He wanted to see a balance between the public           
 right to know and the value of the information being received.                
                                                                               
 Number 1714                                                                   
                                                                               
 MS. MILES pointed out that municipalities under 1,000 in population           
 were not required to report.  "Communities would have the ability             
 to vote themselves out of this law, and haven't done it, which                
 makes the commission believe that the information's useful to                 
 them," she explained.                                                         
                                                                               
 REPRESENTATIVE B. DAVIS asked what the average amount of money                
 spent was for those kinds of races.                                           
                                                                               
 Number 1795                                                                   
                                                                               
 MS. MILES referred to municipal races and said that excluding                 
 amounts below $1,000, the amounts between $1,000 and $2,500                   
 included most of the assembly and school board races in smaller               
 communities.                                                                  
                                                                               
 REPRESENTATIVE B. DAVIS stated her understanding that many people             
 running for office did not come up even to the $1,000 level.                  
                                                                               
 MS. MILES indicated that was correct.  She estimated that in                  
 smaller communities, an average of 70 percent spent less than                 
 $1,000.  "So, what's left, a lot of times, is between $1,000 and              
 $2,500," she said.                                                            
                                                                               
 Number 1848                                                                   
                                                                               
 CHAIRMAN PORTER noted that the objection was maintained.   He asked           
 for a roll call vote on Amendment 14.  Voting for the amendment               
 were Representatives B. Davis and Finkelstein.  Voting against the            
 amendment were Representatives Bunde, Vezey and Porter.                       
 Representatives Green and Toohey were absent.  So, Amendment 14               
 failed.                                                                       
                                                                               
 Number 1915                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 15 to CSHB 368(STA),             
 which read:                                                                   
                                                                               
 Page 16, Lines 17-28                                                          
 -Delete all material                                                          
 -Insert:  "(d)  A member of the commission, the commission's                  
 executive director, a person or group who believes a violation of             
 this chapter or a regulation adopted under it has occurred or is              
 occurring may file an administrative complaint with the commission            
 within four years of the date of the alleged violation.  If a                 
 member of the commission has filed the complaint, that member may             
 not participate as a commissioner in any proceeding of the                    
 commission with respect to the complaint.  If the commission                  
 accepts the complaint and opens a preliminary investigation, it               
 shall do so within 90 days of the filing date of the complaint and            
 shall investigate the complaint.  After affording the respondent              
 notice and an opportunity to be heard, if the commission finds that           
 the respondent has engaged in or is about to engage in an act or              
 practice that constitutes or will constitute a violation of this              
 chapter or a regulation adopted under it, the commission shall                
 enter an order requiring the violation to be ceased or to be                  
 remedied, and shall assess civil penalties under AS 15.13.125.  A             
 commission order may be appealed to the superior court by either              
 the complainant or respondent within 30 days.  The commission or              
 its executive director shall promptly report to the attorney                  
 general concerning any acts or practices that may constitute                  
 violations of this chapter or regulations adopted under this                  
 chapter, or concerning the violation of any order of the                      
 commission."                                                                  
                                                                               
 Page 16, Line 30 - Page 17, Line 14                                           
 -Delete all material                                                          
 -Insert:  "(e)  If the commission does not open a preliminary                 
 investigation within 90 days of the filing date of the complaint or           
 complete action on the complaint within 120 days of the filing, the           
 complaint is rejected.  A complainant whose complaint is rejected             
 may file a complaint in superior court alleging a violation of this           
 chapter by a person charged in the administrative complaint.  The             
 superior court summons and complaint shall be served on the                   
 commission and the attorney general.  The state shall have the                
 right to intervene in a timely manner.  A complaint may not be                
 filed in superior court under this subsection if more than four               
 years have elapsed from the date of the alleged violation.  Nothing           
 in this subsection creates a private cause of action against the              
 commission."                                                                  
                                                                               
 REPRESENTATIVE FINKELSTEIN explained that the complaint registered            
 in the House State Affairs Committee and elsewhere was that the               
 ability to go to court would be used as a tool to harass candidates           
 in circumstances where no significant violation had occurred.  With           
 the amendment, before a person went to court, he or she had to file           
 a complaint with the commission.  After filing, APOC had 90 days to           
 begin and action and 120 days to complete it; a person could not go           
 to court until after that.  "I've never completely agreed with that           
 argument myself," he said, "because already ... complaints to the             
 commission can be used to harass a candidate."  However, many                 
 commission members had felt otherwise, he said.                               
                                                                               
 Number 1982                                                                   
                                                                               
 MS. MILES affirmed that Amendment 15 addressed the commission's               
 concern over the current language in CSHB 368(STA), which gave the            
 commission 60 days to open the investigation, conduct it and                  
 adjudicate it.  She suggested it was a fair and workable                      
 compromise.  She mentioned that the fiscal note contained a new               
 investigator position.                                                        
                                                                               
 CHAIRMAN PORTER asked if there was an objection to Amendment 15.              
                                                                               
 Number 2029                                                                   
                                                                               
 REPRESENTATIVE VEZEY objected and asked for clarification.  He                
 noted that the new language provided four years from the date of              
 the alleged violation to file a complaint.                                    
                                                                               
 CHAIRMAN PORTER asked why it had been extended from two years to              
 four years.                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN responded that the four-year limit on              
 complaints to the commission was in the initiative.  He referred to           
 the new section (e), the second-to-last sentence in the amendment,            
 which applied to when a person could go to court.  He believed that           
 change to four years had come from the commission's recommendation            
 rather than from the initiative.                                              
                                                                               
 Number 2200                                                                   
                                                                               
 REPRESENTATIVE BUNDE referred to the second-to-last sentence of (e)           
 in Amendment 15.  He moved to amend "four" years to "two" years.              
                                                                               
 CHAIRMAN PORTER noted the motion and asked if there was an                    
 objection.  There being none, the amendment to Amendment 15 passed.           
                                                                               
 REPRESENTATIVE VEZEY moved to amend the first sentence of (d) in              
 Amendment 15 by changing "four" years to "two" years.                         
                                                                               
 MS. MILES commented that current law had a statute of limitations             
 of four years.  "So, if you want to reduce that, that's a policy              
 call of the legislature," she said.                                           
                                                                               
 CHAIRMAN PORTER asked if it would affect the initiative.                      
                                                                               
 MS. MILES said the initiative had a four-year statute of                      
 limitations for the commission.                                               
                                                                               
 Number 2259                                                                   
                                                                               
 CHAIRMAN PORTER suggested including it with issues for the next               
 meeting and noted they were holding the second amendment to                   
 Amendment 15.  He affirmed that Amendment 15, as amended, was the             
 initiative approach.                                                          
                                                                               
 CHAIRMAN PORTER asked if there was an objection to Amendment 15, as           
 amended.  There being none, Amendment 15 passed.                              
                                                                               
 Number 2312                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN offered Amendment 16 to CSHB 368(STA),             
 which read:                                                                   
                                                                               
      Page 10, Line 18, after "(c)"                                            
            Insert:  "On and after the date determined under AS                
       15.13.110 as the last day of the period ending three                    
       days before the due date of the report required to be                   
       filed under AS 15.13.110(a)(1) and until the date of the                
       election for which the report is filed, a candidate may                 
       not give or loan, or both, to the candidate's campaign                  
       the candidate's money or other thing of value of the                    
       candidate in an amount that exceeds $5,000."                            
                                                                               
      Page 10, Line 18                                                         
           Delete:  "(c)"                                                      
           Insert:  "(d)"                                                      
                                                                               
 REPRESENTATIVE FINKELSTEIN explained that Amendment 16 recognized             
 that candidates could give unlimited money to give their own                  
 campaign.  However, they could not give more than $5,000 within 30            
 days of the election.  It was an approach recently adopted by the             
 state of Washington to avoid stealthy campaigns, he indicated.                
 Although it had nothing to do with the initiative, there were                 
 already portions of the bill that were not part of the initiative             
 but which clarified or strengthened it, he said.  He expressed that           
 he thought it reasonable.  "It's fine to use your own money," he              
 said.  "You just have to say you're using your own money."                    
                                                                               
 CHAIRMAN PORTER asked if there was any discussion or objection to             
 Amendment 16.                                                                 
                                                                               
 REPRESENTATIVE VEZEY objected.                                                
                                                                               
 CHAIRMAN PORTER asked for a roll call vote.  Voting for the                   
 amendment were Representatives Finkelstein, B. Davis and Porter.              
 Voting against the amendment were Representatives Bunde and Vezey.            
 Representatives Green and Toohey were absent.  Chairman Porter                
 noted that Amendment 16 passed.                                               
                                                                               
 Number 2387                                                                   
                                                                               
 REPRESENTATIVE FINKELSTEIN indicated that he had a conceptual                 
 amendment and explained he wanted to ask the bill drafter to                  
 prepare an amendment precluding jury trial.                                   
                                                                               
 REPRESENTATIVE VEZEY said, "There are some clauses in here which              
 are borderline criminal penalties."                                           
                                                                               
 REPRESENTATIVE FINKELSTEIN indicated he would withdraw it since               
 there was an objection.                                                       
                                                                               
 REPRESENTATIVE BUNDE said he had an amendment that he would not               
 offer currently but would rework for the next meeting.                        
                                                                               
 Number 2441                                                                   
                                                                               
 CHAIRMAN PORTER said the bill would be heard again the following              
 Monday.  He asked members who had issues to write them down for               
 that meeting.                                                                 
 ADJOURNMENT                                                                   
                                                                               
 There being no further business to conduct, CHAIRMAN PORTER                   
 adjourned the House Judiciary Committee meeting at 3:35 p.m.                  
                                                                               

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