Legislature(1997 - 1998)
04/29/1998 01:00 PM House JUD
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE JUDICIARY STANDING COMMITTEE April 29, 1998 1:00 p.m. MEMBERS PRESENT Representative Joe Green, Chairman Representative Con Bunde, Vice Chairman Representative Brian Porter Representative Norman Rokeberg Representative Jeannette James Representative Eric Croft Representative Ethan Berkowitz MEMBERS ABSENT All members present COMMITTEE CALENDAR CS FOR SENATE JOINT RESOLUTION NO. 42(FIN) Proposing an amendment to the Constitution of the State of Alaska relating to marriage. - MOVED CSSJR 42(FIN) OUT OF COMMITTEE CS FOR SENATE BILL NO. 323(FIN) am "An Act relating to sexual offenses, to those who commit sexual offenses, and to registration of sex offenders; amending Rule 6(r)(2), Alaska Rules of Criminal Procedure; and providing for an effective date." - MOVED CSSB 323(FIN) am OUT OF COMMITTEE HOUSE BILL NO. 319 "An Act relating to an employee's expectation of privacy in employer premises." - MOVED CSHB 319(JUD) OUT OF COMMITTEE HOUSE BILL NO. 452 "An Act relating to registration, disclosures, and reports by certain nonprofit corporations." - MOVED CSHB 452(JUD) OUT OF COMMITTEE CS FOR SENATE BILL NO. 284(STA) "An Act relating to cruelty to animals." - MOVED CSSB 284(STA) OUT OF COMMITTEE SENATE BILL NO. 309 "An Act relating to the use of force by peace officers and correctional officers." - SCHEDULED BUT NOT HEARD HOUSE BILL NO. 434 "An Act requiring drug testing for applicants for and recipients of assistance under the Alaska temporary assistance program; and providing for an effective date." - REMOVED FROM AGENDA (* First public hearing) PREVIOUS ACTION BILL: SJR 42 SHORT TITLE: CONSTITUTIONAL AMENDMENT RE MARRIAGE SPONSOR(S): HEALTH, EDUCATION & SOCIAL SERVICES Jrn-Date Jrn-Page Action 3/02/98 2701 (S) READ THE FIRST TIME - REFERRAL(S) 3/02/98 2701 (S) JUDICIARY, FINANCE 3/09/98 (S) JUD AT 1:30 PM BELTZ ROOM 211 3/09/98 (S) MINUTE(JUD) 3/10/98 2807 (S) JUD RPT CS 4DP 1DNP SAME TITLE 3/10/98 2807 (S) DP: TAYLOR, PARNELL, MILLER, PEARCE 3/10/98 2807 (S) DNP: ELLIS 3/10/98 2807 (S) FISCAL NOTE TO SJR & CS (GOV) 3/24/98 (S) FIN AT 9:00 AM SENATE FINANCE 532 3/31/98 (S) FIN AT 1:00 PM SENATE FINANCE 532 3/31/98 (S) FIN AT 7:00 PM SENATE FINANCE 532 4/01/98 (S) FIN AT 7:00 AM SENATE FINANCE 532 4/02/98 (S) FIN AT 9:00 AM SENATE FINANCE 532 4/06/98 3158 (S) FIN RPT CS 5DP 1DNP 1NR SAME TITLE 4/06/98 3158 (S) DP: SHARP, PHILLIPS, PARNELL, DONLEY, 4/06/98 3158 (S) TORGERSON; DNP: ADAMS; NR: PEARCE 4/06/98 3158 (S) PREVIOUS FN APPLIES (GOV) 4/08/98 (S) RLS AT 11:20 AM FAHRENKAMP RM 203 4/08/98 (S) MINUTE(RLS) 4/16/98 3294 (S) RULES TO CALENDAR 1NR 4/16/98 4/16/98 3297 (S) READ THE SECOND TIME 4/16/98 3298 (S) FIN CS ADOPTED UNAN CONSENT 4/16/98 3298 (S) AM NO 1 FAILED Y4 N16 4/16/98 3299 (S) ADVANCED TO THIRD READING Y15 N5 4/16/98 3300 (S) READ THE THIRD TIME CSSJR 42(FIN) 4/16/98 3300 (S) PASSED Y14 N6 4/16/98 3300 (S) ADAMS NOTICE OF RECONSIDERATION 4/17/98 3334 (S) RECON TAKEN UP - IN THIRD READING 4/17/98 3334 (S) PASSED ON RECONSIDERATION Y14 N6 4/17/98 3346 (S) TRANSMITTED TO (H) 4/18/98 3071 (H) READ THE FIRST TIME - REFERRAL(S) 4/18/98 3071 (H) JUDICIARY, FINANCE 4/27/98 (H) JUD AT 1:00 PM CAPITOL 120 4/27/98 (H) MINUTE(JUD) BILL: SB 323 SHORT TITLE: SEX OFFENSES & OFFENDER REGISTRATION SPONSOR(S): SENATOR(S) PEARCE, Taylor, Lincoln, Kelly, Donley, Miller, Green Jrn-Date Jrn-Page Action 2/16/98 2529 (S) READ THE FIRST TIME - REFERRAL(S) 2/16/98 2529 (S) JUD, FIN 3/11/98 (S) JUD AT 1:45 PM BELTZ ROOM 211 3/11/98 (S) MINUTE(JUD) 3/12/98 2842 (S) JUD RPT CS 3DP 2NR SAME TITLE 3/12/98 2842 (S) DP: TAYLOR, MILLER, PEARCE 3/12/98 2842 (S) NR: ELLIS, PARNELL 3/12/98 2842 (S) FISCAL NOTE TO SB (COR) 3/12/98 2842 (S) INDETERMINATE FN TO SB (ADM) 3/12/98 2848 (S) COSPONSOR: TAYLOR 3/24/98 (S) FIN AT 9:00 AM SENATE FINANCE 532 3/25/98 (S) RLS AT 12:55 PM FAHRENKAMP RM 203 3/25/98 (S) MINUTE(RLS) 3/25/98 2988 (S) FIN RPT CS 4DP 2NR SAME TITLE 3/25/98 2988 (S) DP: PEARCE, SHARP, PHILLIPS, TORGERSON; 3/25/98 2988 (S) NR: DONLEY, ADAMS 3/25/98 2988 (S) PREVIOUS FN (CORR) 3/25/98 2988 (S) PREVIOUS INDETERMINATE FN (ADM) 3/26/98 3008 (S) RULES TO CALENDAR 3/26/98 3/26/98 3010 (S) READ THE SECOND TIME 3/26/98 3010 (S) FIN CS ADOPTED UNAN CONSENT 3/26/98 3010 (S) ADVANCED TO THIRD READING UNAN CONSENT 3/26/98 3010 (S) READ THE THIRD TIME CSSB 323(FIN) 3/26/98 3010 (S) COSPONSOR(S): LINCOLN, KELLY, DONLEY, 3/26/98 3010 (S) MILLER, GREEN 3/26/98 3011 (S) PASSED Y16 N- E4 3/26/98 3011 (S) COURT RULE(S) SAME AS PASSAGE 3/26/98 3011 (S) EFFECTIVE DATE(S) SAME AS PASSAGE 3/26/98 3011 (S) KELLY NOTICE OF RECONSIDERATION 3/26/98 3011 (S) RECON TAKEN UP SAME DAY UNAN CONSENT 3/26/98 3011 (S) HELD ON RECONSIDERATION TO 3/30 CALENDAR 3/30/98 3050 (S) RECON TAKEN UP - IN THIRD READING 3/30/98 3050 (S) RETURN TO SECOND FOR AM 1 UNAN CONSENT 3/30/98 3050 (S) AM NO 1 ADOPTED UNAN CONSENT 3/30/98 3051 (S) AUTOMATICALLY IN THIRD READING 3/30/98 3051 (S) RETURN TO SECOND FOR AM 2 UNAN CONSENT 3/30/98 3051 (S) AM NO 2 ADOPTED UNAN CONSENT 3/30/98 3052 (S) AUTOMATICALLY IN THIRD READING 3/30/98 3053 (S) PASSED ON RECONSIDERATION Y20 N- 3/30/98 3053 (S) EFFECTIVE DATE(S) SAME AS PASSAGE 3/30/98 3053 (S) COURT RULE(S) SAME AS PASSAGE 3/30/98 3055 (S) TRANSMITTED TO (H) 3/31/98 2807 (H) READ THE FIRST TIME - REFERRAL(S) 3/31/98 2807 (H) JUDICIARY, FINANCE 4/28/98 (H) JUD AT 1:00 PM CAPITOL 120 4/28/98 (H) MINUTE(JUD) BILL: HB 319 SHORT TITLE: EMPLOYEES: NO EXPECTATION OF PRIVACY SPONSOR(S): REPRESENTATIVES(S) ROKEBERG Jrn-Date Jrn-Page Action 1/14/98 2040 (H) READ THE FIRST TIME - REFERRAL(S) 1/14/98 2040 (H) LABOR & COMMERCE 1/14/98 2045 (H) ADDITIONAL REFERRAL TO JUD 3/25/98 (H) L&C AT 3:15 PM CAPITOL 17 3/25/98 (H) MINUTE(JUD) 3/27/98 2767 (H) L&C RPT CS(L&C) 1DP 5NR 3/27/98 2767 (H) DP: ROKEBERG; NR: COWDERY, SANDERS, 3/27/98 2767 (H) KUBINA, HUDSON, RYAN 3/27/98 2767 (H) ZERO FISCAL NOTE (LAW) 4/20/98 (H) JUD AT 1:00 PM CAPITOL 120 4/20/98 (H) MINUTE(JUD) 4/23/98 (H) JUD AT 1:00 PM CAPITOL 120 4/23/98 (H) MINUTE(JUD) BILL: HB 452 SHORT TITLE: NONPROFIT CORPORATIONS DISCLOSURES SPONSOR(S): REPRESENTATIVES(S) GREEN Jrn-Date Jrn-Page Action 2/18/98 2362 (H) READ THE FIRST TIME - REFERRAL(S) 2/18/98 2362 (H) JUDICIARY 3/04/98 (H) JUD AT 1:00 PM CAPITOL 120 3/04/98 (H) MINUTE(JUD) 3/06/98 (H) JUD AT 1:00 PM CAPITOL 120 3/06/98 (H) MINUTE(JUD) 4/15/98 (H) JUD AT 1:00 PM CAPITOL 120 4/15/98 (H) MINUTE(JUD) 4/28/98 (H) JUD AT 1:00 PM CAPITOL 120 4/28/98 (H) MINUTE(JUD) BILL: SB 284 SHORT TITLE: CRUELTY TO ANIMALS SPONSOR(S): SENATOR(S) DONLEY, Phillips, Ellis; REPRESENTATIVE(S) Croft Jrn-Date Jrn-Page Action 2/09/98 2450 (S) READ THE FIRST TIME - REFERRAL(S) 2/09/98 2450 (S) STA, JUD 2/11/98 2487 (S) COSPONSOR: PHILLIPS 2/12/98 2505 (S) COSPONSOR: ELLIS 3/03/98 (S) STA AT 3:30 PM BELTZ ROOM 211 3/03/98 (S) MINUTE(STA) 3/04/98 2734 (S) STA RPT CS 4DP SAME TITLE 3/04/98 2734 (S) DP: GREEN, DUNCAN, MACKIE, WARD 3/04/98 2734 (S) ZERO FISCAL NOTE TO SB & CS (LAW, S.STA) 3/20/98 (S) JUD AT 1:30 PM BELTZ ROOM 211 3/20/98 (S) MINUTE(JUD) 3/23/98 2944 (S) JUD RPT 2DP 1NR (STA)CS 3/23/98 2944 (S) DP: TAYLOR, PEARCE; NR: PARNELL 3/24/98 (S) RLS AT 11:45 AM FAHRENKAMP RM 203 3/24/98 (S) MINUTE(RLS) 3/26/98 3008 (S) INDETERMINATE FN (LAW) 3/26/98 3008 (S) RULES TO CALENDAR 3/26/98 3/26/98 3009 (S) READ THE SECOND TIME 3/26/98 3009 (S) STA CS ADOPTED UNAN CONSENT 3/26/98 3009 (S) ADVANCED TO THIRD READING UNAN CONSENT 3/26/98 3009 (S) READ THE THIRD TIME CSSB 284(STA) 3/26/98 3010 (S) PASSED Y16 N- E4 3/26/98 3013 (S) TRANSMITTED TO (H) 3/27/98 2767 (H) READ THE FIRST TIME - REFERRAL(S) 3/27/98 2767 (H) JUDICIARY 4/29/98 (H) JUD AT 1:00 PM CAPITOL 120 WITNESS REGISTER KRISTY TIBBLES, Researcher to Senator Drue Pearce Alaska State Legislature Capitol Building, Room 518 Juneau, Alaska 99801 Telephone: (907) 465-4747 POSITION STATEMENT: Presented KEVIN JARDELL, Legislative Administrative Assistant to Representative Joe Green Alaska State Legislature Capitol Building, Room 118 Juneau, Alaska 99801 Telephone: (907) 465-4990 POSITION STATEMENT: Answered questions on CSSB 323(FIN) am. JANET SEITZ, Legislative Assistant to Representative Norman Rokeberg Alaska State Legislature Capitol Building, Room 24 Juneau, Alaska 99801 Telephone: (907) 465-4968 POSITION STATEMENT: Answered questions on CSSB 323(FIN) am. JEFFREY LOGAN, Legislative Assistant to Representative Joe Green Alaska State Legislature Capitol Building, Room 118 Juneau, Alaska 99801 Telephone: (907) 465-6841 POSITION STATEMENT: Discussed changes in Version F and answered questions about HB 452 on behalf of sponsor. ACTION NARRATIVE TAPE 98-76, SIDE A Number 0001 CHAIRMAN JOE GREEN called the House Judiciary Standing Committee meeting to order at 1:00 p.m. Members present at the call to order were Representatives Green, Porter, Rokeberg, James and Croft. Representatives Berkowitz and Bunde arrived at 1:05 p.m. and 1:10 p.m., respectively. CSSJR 42(FIN) - CONSTITUTIONAL AMENDMENT RE MARRIAGE CHAIRMAN GREEN announced the first item of business would be CSSJR 42(FIN), proposing an amendment to the Constitution of the State of Alaska relating to marriage. He noted that the committee had heard the resolution at length two days before. Number 0061 REPRESENTATIVE JEANNETTE JAMES made a motion to move CSSJR 42(FIN) from committee with individual recommendations and attached fiscal note(s). REPRESENTATIVE ERIC CROFT objected. CHAIRMAN GREEN requested a roll call vote. Voting to move the resolution were Representatives James, Porter, Rokeberg and Green. Voting against it was Representative Croft. Representatives Berkowitz and Bunde had not yet arrived. Therefore, CSSJR 42(FIN) moved from the House Judiciary Standing Committee by a vote of 4-1. CSSB 323(FIN) am - SEX OFFENSES & OFFENDER REGISTRATION Number 0104 CHAIRMAN GREEN indicated the next order of business would be CSSB 323(FIN), "An Act relating to sexual offenses, to those who commit sexual offenses, and to registration of sex offenders; amending Rule 6(r)(2), Alaska Rules of Criminal Procedure; and providing for an effective date," sponsored by the Senate Finance Committee. KRISTY TIBBLES, Researcher to Senator Drue Pearce, Alaska State Legislature, came before the committee. She indicated that at the meeting the previous day there was concerns regarding the bill. REPRESENTATIVE CROFT said he reviewed the bill with Mr. Guenali and it is as difficult as people thought to define this area of the law much further. He said they could not find federal guidelines. There were some federal statutes, federal cases and some old state cases that gave some more illumination to it. Representative Croft said there may be a way to do this better, but there probably isn't a way to do it better in the next day or even two weeks. He said he appreciates the chairman giving him a day to try and figure out if there is someway to define it better. Number 0243 REPRESENTATIVE ETHAN BERKOWITZ indicated he had a proposed amendment and moved to adopt it. CHAIRMAN GREEN objected for the purpose of discussion. REPRESENTATIVE BERKOWITZ explained what he is trying to do with the amendment is to ensure that if the state brings a criminal charge against the sexual perpetrator, the victim similarly situated can also seek redress at that time as the statute of limitations would have otherwise expired. Number 0321 REPRESENTATIVE BRIAN PORTER questioned what the current statute of limitations is. REPRESENTATIVE BERKOWITZ responded that it is three years after discovery and it is located in Section 1 of the bill. He referred to Section 9 and said, "Even if the general time limit of limitations expires the prosecution for sexual offenses - for an offense committed against a person under the age of 18 may be commenced at any time." REPRESENTATIVE JAMES said she doesn't know why the amendment is needed. REPRESENTATIVE BERKOWITZ explained the criminal charge can be brought at any time but the civil case can't be. A person could be in a situation where the state would be bringing a criminal charge, but an individual might not be permitted to bring a civil case. Number 0430 REPRESENTATIVE CROFT said it seems to be particularly appropriate in dealing with sexual offenses involving children. There are various reasons why a child or guardian may not bring that action within three years. REPRESENTATIVE PORTER said if he understands the meaning of the amendment, there will be no statute of limitations for a civil case brought by an alleged sexual assault victim against the alleged offender. REPRESENTATIVE BERKOWITZ responded, "If the victim was under 18 at the time of the offense." REPRESENTATIVE PORTER said, "All of the reasons that we discussed about adding reasonable statutes of limitations, the statutes of repose come into play. As much as child sexual abuse is a despicable thing, bringing one of these cases 25 years later creates problems that I don't think they're outweighed by the benefit." He stated he can't support the amendment. REPRESENTATIVE BERKOWITZ stated that is true, but we've made exception in the criminal law. If there is a discovery 25 years later, we're allowing the state to pursue an action. For all the reasons talked about earlier, for eliminating actions would logically apply to the state for a criminal action. He said he believes a limitation should be put on the state's ability to bring a criminal action or loosen the ability of an individual to bring civil action. Number 0590 CHAIRMAN GREEN suggested, as a friendly amendment, that on line 8 if instead of "at any time," change it to say "within three years after the victim reaches the age of majority." He said, "In other words, this 5-year-old has been put upon. Now he reaches 21 and so that then gives him nearly 20 years find, plus the fact that whatever suppressed his ability to bring the cause of action earlier - now he's an adult and would not be subject perhaps parental or at least family-type abuse." REPRESENTATIVE BERKOWITZ said he believes that is a step in the right direction. He pointed out that the limitation operates under the assumption that people leave home when they're 18. He noted that are a lot of people who don't for various reasons. CHAIRMAN GREEN referred to a person who was to bring a civil action for abuse that happened many years ago and asked if that same person would stay in that household after they were an adult. REPRESENTATIVE BERKOWITZ stated there could be circumstances where an individual would such as to protect a younger sibling. CHAIRMAN GREEN said that open-endedness is probably more than he can handle. REPRESENTATIVE JAMES stated criminal law is punishable by fines or imprisonment or both. Civil law seems to be only punishable by money. She said sees this as opening the door for family distress. Representative James said when people go to court on a civil case two things have to be measured, "What is the result going to be? And how much money you want to get?" Representative James said she understands the argument by Representative Berkowitz that if the criminal act is okay, that the civil act should be okay. She stated she doesn't see any connection between the two. There might be a case when a child had been sexual assaulted when they under six and by the time the child gets into the hands of the state, they are a teenager. There may be some costs incurred by the state because of something that happened to a child a long time ago. She said she doesn't have any real discomfort in allowing the criminal action to be carried forward because it has a different motive. A civil case only has the issue of money. If there isn't money, a lawsuit probably wouldn't be filed and if there is, there would be a lawsuit filed. Representative James stated she isn't comfortable with the amendment. REPRESENTATIVE BERKOWITZ said, "Maybe I can offer an amendment that combines the friendly amendment you had which would be something, 'Within three years of majority or within three years after the onset of criminal prosecution.'" Number 0852 REPRESENTATIVE PORTER asked if that doesn't just extend what the current law provides by one year. KEVIN JARDELL, Legislative Administrative Assistant to Representative Joe Green, Alaska State Legislature, came before the committee. He explained that in AS 09.10.140 it states you would have two years after you become the age of majority. If the causing event happens while under the age of majority, it is towed until you reach the age of majority in which time you have two years to bring the action. There are also two special provisions for sexual abuse. He stated that it seems that if you have an injury or illness, being psychological he would imagine, that you discover and you relate it back to an event, you have three years from the time you make that connection that your psychological problems are related to the sexual abuse. Mr. Jardell stated that there are provisions. REPRESENTATIVE BERKOWITZ said, "The loophole is there might be a situation, and I've seen them in other states, where a victim makes a decision not to pursue a case, fully cognizance of the effect it's had him. Yet, after a period of time, the state pursues a criminal case, maybe not against this individual victim but a case that would involve this victim, in which case the victim has, in a sense, been forced to confront ... their past in a way they might not have otherwise chosen to do, in a time they otherwise (indisc.) chosen to. And at that point, their own personal statute of limitations has lapsed, but they've been brought back into all the abuse that occurred before." Number 0994 REPRESENTATIVE PORTER said, "I guess you could come up with a 'what if' and just about an exception to every rule that we have. But that individual what if - is not going to happened enough to change my mind on this being appropriate position that is in without this amendment." REPRESENTATIVE CROFT said Representative James discussed that we can fine or imprison with criminal or solely fine with civil. He said it seems that if you're going to throw someone in jail based on evidence getting stale, you're going to do the greater thing, but you're not going to allow the victim recover. It seems backwards in that if you want to close off something at some point, you close off the one with the more egregious consequences and not the one with the less egregious consequences. He said he isn't sure why there is an unlimited statute of limitations on this. Representative Croft stated, "I think there are good reasons. This is a thing that children often don't understand, sometimes can't fully understand, or that it takes them a long time because they're so embarrassed to tell. And so it is an area that is particularly ill suited to restrictive statute of limitations - put the other way, it's particularly well-suited to giving them a lot of ... time." Number 1090 CHAIRMAN GREEN said if this was such a crime that it would cause monetarily correctable damage, the current statute allows for two years past the majority. If it were going to be something where they would come back when they're 55 years old, it makes you wonder if the damage that was caused is correctable by some sort of monetary disposition as opposed to incarceration. REPRESENTATIVE BERKOWITZ explained that another reason why a lot of these cases proceed to civil court and that is so the victims feel like they get their day in court and have the opportunity to make their accusation and to have a jury validate their injuries which is above and beyond the money on many occasions. REPRESENTATIVE JAMES said the other one is the O. J. revisited as the evidence is more severely reviewed in a criminal case than it is in a civil case. The burden of proof is different. They could lose in a criminal case and then file a civil case. REPRESENTATIVE PORTER said he thinks that is one of the reasons that a distinction between an unlimited amount of time to go back on a criminal case and trying to do the came thing for a civil case. It significantly different as there is a very high burden of proof in criminal cases. Representative Porter said he would venture to say that you could count on one hand the amount of successful prosecutions in this kind of situation that goes back 30 or 40 years. At the time that was put into statute, he would guess the repressed memory syndrome was popular. Over the last few years, it is becoming more and more evident that is a unlikely occurrence. He stated he would not support the amendment. CHAIRMAN GREEN stated there is an amendment before the committee and an objection is maintained. He requested a roll call vote on Amendment 1. Representatives Rokeberg, Porter, James, Bunde and Green voted against the adoption of the amendment. Representatives Berkowitz and Croft voted in favor the amendment. Amendment 1 failed to be adopted by a vote of 5-2. Number 1271 REPRESENTATIVE CROFT made a motion to move CSSB 323(FIN) am out of committee with individual recommendations and with the attached fiscal notes. There being no objection CSSB 323(FIN) am moved out of the House Judiciary Standing Committee. HB 319 - EMPLOYEES: NO EXPECTATION OF PRIVACY Number 1343 CHAIRMAN GREEN announced the committee would address HB 319, "An Act relating to an employee's expectation of privacy in employer premises." REPRESENTATIVE NORMAN ROKEBERG, prime sponsor of HB 319, explained the committee has been provided with Version B, Cramer, 4/27/98. He said he presents the committee substitute for the consideration of the committee. REPRESENTATIVE CROFT indicated he had missed some of the prior discussion regarding the bill. He referred to the prior version and said, "There was an exception in the prior one exempting us. Is that out?" REPRESENTATIVE ROKEBERG indicated it is still in the bill on page 2, line 16. He noted it is there so that the presiding officer can't snooping in your files. Number 1460 REPRESENTATIVE CON BUNDE moved that the proposed committee substitute be adopted. CHAIRMAN GREEN asked if there was an objection to the adopted of CSHB 319, Version B. REPRESENTATIVE CROFT objected for the purpose of knowing what it does. REPRESENTATIVE ROKEBERG said on page 1, lines 5 and 6, the words "between an employer and a employee of an employer" was added. He referred to line 11 and said he believes the committee adopted the wording "not hinder or obstruct". The word "from" was included on line 12. It would then read, "The employee may not hinder or obstruct the employer from access..." Representative Rokeberg explained the major changes begin on page 1, line 15. It would read, "This section does not waive and employee's expectation of privacy with respect to (1) a personal telephone call; (2) premises or equipment, including a computer and computer information, owned by the employee but used in the employee's employment for the employer even if the equipment is connected to the employer's equipment or service for the equipment is supplied by the employer." He said you could bring your own computer in and plug it in to the data line and they still can't eavesdrop on you. Representative Rokeberg stated he believes this wording meets the concerns the committee had voiced. Representative Rokeberg said, "Also, a personal telephone call - this one is a little bit problematic for myself, but this is what the committee wished. I'm not sure what a personal telephone call is, it's a personal telephone call." REPRESENTATIVE ROKEBERG pointed out that he believes the testimony received by committee staff regarding the level of law, in terms of privacy in this state, was correct. Staff provided him with the Neighbors v. Ludkey (ph.) case and said it indicates that is the case, in terms of the private sector of the state, there should be no expectation or right of privacy other than what's provided by case law. REPRESENTATIVE ROKEBERG referred to page 2, (c)(1), line 8, "'elected official' means the governor, the lieutenant governor, a member of the legislature, a justice or judge, or a person elected to municipal office;", which includes school board members as seen in the memorandum of April 27. He said "employee" is defined to mean, "a person employed by an employer and includes (i) a permanent, seasonal, probationary, or temporary employee whether employed full-time or part-time; (ii) an independent contractor and an employee of an independent contractor retained by the employer; (B) does not include an elected official;". He stated those are the additions made in the committee substitute. Representative Rokeberg said at this time he would not object to a personal telephone call. Number 1657 REPRESENTATIVE PORTER said he would not interpret the wording to mean that an employee, anywhere, is entitled to make personal phone calls. If an employer has a policy against personal phone calls, that would supersede. If the person, short of that, has personal phone calls or even makes one against the policy, it should be private. It doesn't mean you can't get fired for having personal phone calls. REPRESENTATIVE BERKOWITZ said, "Representative Porter makes the point that I tried to make with an amendment that said, 'absent a specific written agreement should be contrary, an employee has an expectation of privacy.' That expressly drawn up policy precluded personal phone calls -- is the type of agreement that an employee enters into when they sign on. What this whole bill does is turn that notion upside down saying that you can't make a personal phone call ever unless the employer says it's okay." CHAIRMAN GREEN asked if the objection is maintained to adopt Version B. Number 1748 REPRESENTATIVE CROFT withdrew his objection. REPRESENTATIVE BERKOWITZ said if the condition had been that the employer had to specifically say, "You have no expectation of privacy for whatever reasons and whatever instances," the default position is the expectation of privacy. The bill flips the default around saying, "You have no expectation of privacy," meaning that the only time you can expect privacy on the premises is when the employer grants it to you. REPRESENTATIVE PORTER said he thinks it is exactly the opposite. The bill says, "This section does not waive an employee's expectation of privacy with respect to a person phone call." It doesn't say anything else about personal phone calls. He said this should not be used to indicate that personal phone calls are allowed or not allowed by employer policy. REPRESENTATIVE BERKOWITZ said, "And I agree with that, but it's the exception that we carved out with this line. Now if, for example, you're having a personal conversation with somebody, you have no expectation of privacy in that personal conversation because this bill says you have no expectation of privacy on the premises, and we haven't carved out an exception for that conversation." Representative Berkowitz said if he and Chairman Green were having a conversation, and are working for somebody, there is no expectation of privacy in that conversation because there isn't an exception in the bill that covers the conversation. Number 1873 REPRESENTATIVE BUNDE said because the bill specifically says that you have an expectation of privacy in phone calls, and because it doesn't specifically mention any other situation, the expectation of privacy doesn't go anywhere else because it is only delineated in one area. He asked if that is correct. REPRESENTATIVE JAMES said that is correct. CHAIRMAN GREEN said that the committee is talking about phone calls and with a phone call you have that right of privacy. He said he doesn't quite follow the fact that you don't have it. The section doesn't waive that expectation of privacy. REPRESENTATIVE PORTER explained there is case law on what a legitimate expectation of privacy is and isn't and the environment, et cetera, comes into play. He said you couldn't write a statute to take all that in. Number 2055 MR. JARDELL said he believes there should be an understanding of the distinction between the constitutional right and the policy right that our courts have interpreted in the right to privacy. The courts have found there is no constitutional right to privacy in a private matter, citizen on citizen.. Only when there is government action is there a constitutional right to privacy. They look to a policy reasoning behind rights to privacy. He noted the case law dealt mostly with drug testing in nongovernmental businesses and how far they can go to drug test an individual that is working with them. The court went through a long process of setting out that this is a policy call and not a constitutional call, which places a great deal of emphasis on what the committee decides and what eventually passes the legislature. Mr. Jardell explained he believes the point of the legislation was to set out a basic policy statement that when you're within an employer's premises you do not have an expectation of privacy. He noted that is the employer's premises and it is the premises where you do the work. If you're there doing work, you have no expectation of privacy in an office or anything else that's being provided to you at work station. CHAIRMAN GREEN said, "What about closed doors?" MR. JARDELL said, "Again, without this legislation, the courts would go through a, 'Would a reasonable person have an expectation of privacy?' Depending on the specific facts around that, the court may go one way or another. For instance, if you had an employer who told people, 'Look I'm listening, I'm going to be coming around and I'm going to be listening in on doors to make sure you're working,' you may not have an expectation of privacy there whereas if you were in a private sector, you're a legislator, and you conduct a lot meetings closed door, you may have a little more of an expectation of privacy than some other situation. But it is a case-by-case specific. Where are facts of the circumstances?" Number 2182 REPRESENTATIVE PORTER said he agrees with what Mr. Jardell said right up to the point where he said that you shouldn't have any expectation of privacy on somebody else's business premise. He stated that he disagrees. Representative Porter suggested under "the expectation of privacy" he would suggest that the committee add "a personal oral conversation where a rational expectation of privacy exists." He stated he doesn't think anybody would expect, unless they were specifically put on notice, that the entire business premise in which you work is bugged and somebody is listening to everything, but it certainly is totally technologically feasible and probably happens. To the extent that we have a right to privacy in our constitution, he believes it is only appropriate that should be recognized statutorily. REPRESENTATIVE CROFT pointed out that they are trying to recognize various different areas where employees have reasonable expectations of privacy in the workplace. He said he believes there are areas in a workplace where is there is a reasonable expectation of privacy. Representative Croft said, "A telephone call makes sense to me, your own computer makes sense to me, a purse that you stick in the file cabinet of the employer makes sense to me and the conversation makes sense to me. That's why the bill doesn't makes sense to me. I mean I think we should say, instead, the opposite. An employee has a reasonable expectation in the workplace under certain situations and we can't identify them all, but rather than saying they don't we keep coming up with specific defensible where they do." REPRESENTATIVE CROFT referred to constitutional provisions and said they normally only act to limit the government's power. He explained that our constitutional privacy provision says, "The legislature shall implement this provision." He said we have a reasonable expectation of privacy and it's the legislature's job to protect it, not violate it even with exceptions. Representative Croft said he doesn't see that all the different amendments will solve the problem. Number 2363 REPRESENTATIVE PORTER said the idea is to balance legitimate requirements of an employer to operate a business. He referred to the individual rights of employees and said they are in a subordinate position as an employee. If they don't like that, they should go start their own business. REPRESENTATIVE JAMES stated she agrees with Representative Porter. She said, "Having worked in a large corporation for ten years and knowing what can happen when employees have the right to privacy of everything they do and say or not is certainly critical for employers also having been done for small employers for 30 years, I understand that need. When you are on the employer's premise and you're being paid for you services, we need to be sure that what you're doing is worth paying. And I don't necessarily mean to bring this amendment in because it's not a part of our discussion, but an area or compartment used to store an employee's personal belongings -- we live in an age now where people's personal belongings can be disruptive to the business. There are all different kinds of things that people can do like talking to one another, or whatever, should not necessarily be presumed to be private. If they're having a private personal conversation with a family member or somebody on the telephone..." TAPE 98-76, SIDE B Number 0001 REPRESENTATIVE JAMES continued, "...there are obligations that (indisc.) to them and to say that they can do things under the guise of privacy while they're on the paycheck, I disagree with. And I like this bill, and I think it should be that they shouldn't have the presumption of privacy when they're on the employer's premises doing the employer's work. If they want privacy, they could go off of the premises and have it there." REPRESENTATIVE BERKOWITZ explained that the university grounds would be university premises, so there would be no expectation of privacy anywhere in the university. He said you could argue that state lands are state premises, so state employees on state lands have no expectation of privacy. Representative Berkowitz explained that if you can't have an expectation of privacy in academic setting, that's is disruptive to the sort of academic freedom of people. He referred to having closed caucuses and said they are closed so that we can be free with what we're doing. We want to ensure our privacy isn't infringed. Representative Berkowitz referred to he proposed amendment and said Section 22 of the constitution says, "The right of people to privacy is recognized and shall not be infringed." He stated that there are residual personal privacy rights that everyone has. He said he doesn't think the employer should the ability to reach into the employee's privacy. Representative Berkowitz said all he is suggesting is that the employee's right to privacy should only be infringed when the employer tells them, "Don't send personal mail, don't make personal phone calls except during lunch hour, you can have your door closed but I might be listening in." Number 0169 REPRESENTATIVE PORTER stated he would offer Amendment 1. On page 2, add a new "(2)", and then renumber. The section would say, "a personal oral conversation or where a reasonable expectation of privacy exists." REPRESENTATIVE CROFT referred to the wording, "personal oral conversation" and "personal telephone call," and indicated he isn't sure how that would be implemented. He said, "They get to bug my phone, but when they hear me talking personally they have ring off? I mean they get to record my calls but then they have a duty to erase the ones they listened to deemed to be kind of personal as opposed to business." He stated he would removal "personal." Number 0301 REPRESENTATIVE BERKOWITZ said he has an objection to the word "oral" in the proposed amendment as he has done a little bit of work with the deaf and hard of hearing community. CHAIRMAN GREEN said, "I suppose we should cover that since this is more than just those of us who have hearing." He asked Representative Berkowitz if he is offering that as a friendly amendment. Number 0327 MR. JARDELL explained that if "oral" is taken out, it could be interpreted to include e-mail as conversation - electronic conversations. Mr. Jardell noted his previous comments were strictly based on his understanding of the bill and he wasn't advocating one policy or another. REPRESENTATIVE JAMES referred to Representative Berkowitz bringing up the university campus and asked about dormitories. She said she believes employers have a right to expect their people, who are working today, to not be doing a lot of private things that could disrupt the employer. Employees shouldn't have the expectation that anybody overhearing them say something that has a negative effect is okay and they wouldn't be able to use the right to privacy as a defense. However, it seems that there are times and places where mostly what you're doing are personal things in which you should be able to expect privacy such as in a university dormitory. CHAIRMAN GREEN pointed out it says, "reasonable expectations." Number 0430 JANET SEITZ, Legislative Assistant to Representative Norman Rokeberg, Alaska State Legislature, came before the committee. She referred to Representative James' concern and said the bill deals with employees and not students. She stated the bill was amended in the House Labor and Commerce Committee so that residential housing units would not be covered. REPRESENTATIVE BUNDE asked why the bill didn't just say, "an expectation or reasonable expectation of privacy exists except where written agreements are entered into by the employer and the employee." MS. SEITZ explained the drafter of the bill was approached with the concept that they wanted the employer and employee to sign an agreement and this was how the drafter felt it could best be put into language. She said she thinks that Representative Rokeberg wants the employees to know that they don't have a reasonable expectation of privacy except in certain circumstances. She said they are approaching more from an employer's aspect, but are still giving the employees some protection because they can have a written agreement that delineates parameters. Number 0512 REPRESENTATIVE PORTER referred to Representative Bunde's concern and said, "In addition ... to the who is the boss and who is the employee consideration, in a state that has an individual right to privacy undefined in its constitution, if you get into these areas and approach it from that perspective, you would be surprised what you could end up with in terms of individual rights." REPRESENTATIVE PORTER referred to removing the word "oral" and said he would not see it as a friendly amendment. REPRESENTATIVE JAMES asked Representative Porter to read his amendment again. REPRESENTATIVE PORTER said under the wording "(1) a personal telephone call;", add a new "(2)" and renumber. He said the new "(2)" would read "a personal oral conversation where a reasonable expectation of privacy exists." REPRESENTATIVE BERKOWITZ suggested the wording read, "oral or sign language conversation...." CHAIRMAN GREEN said it's conversation whether it's oral or sign. REPRESENTATIVE PORTER said, "By the very nature of sign language, unless you're in a room by yourself, you do not have an expectation of privacy when you think that there may be someone who can read it. It isn't an audible transmission." REPRESENTATIVE CROFT pointed out you could have sign language conversations where you're doing it in the palm of the hand or whatever. So you can whisper in sign language, but it's not easy to do. There can be a conversation in sign language where reasonable expectation of privacy would exist. REPRESENTATIVE PORTER said he wouldn't consider adding the wording, "or sign language" as a friendly amendment to his amendment. Number 0633 MR. JARDELL suggested saying, "a personal conversation" and then put an exclusionary clause in that says, "not to include electronic conversations." CHAIRMAN GREEN stated a telephone is an electronic conversation. He asked Representative Porter if he wishes to pursue Mr. Jardell's wording. REPRESENTATIVE PORTER responded in the negative. CHAIRMAN GREEN asked if there is objection to Amendment 1, item "(2)". REPRESENTATIVE CROFT objected. CHAIRMAN GREEN requested a roll call vote. Representatives Bunde, James, Porter and Green voted in favor of adopting the amendment. Representatives Berkowitz, Croft and Rokeberg voted against the amendment. Amendment 1 was adopted by a vote of 4 to 3. REPRESENTATIVE BERKOWITZ moved Amendment 2 which would include the wording, "or sign language" after the word "oral" in Amendment 1. REPRESENTATIVE JAMES objected. Number 0722 REPRESENTATIVE PORTER said that what was done by adding (1) and the new (2) is codify an area of the law that is very clear. Where the law may be on sign language, as a language, or demonstrative gestures, is an area of the law he doesn't think we want to jump into. REPRESENTATIVE BUNDE stated that he does know that the American sign language (ASL) is a recognized language. He noted there is another, but he can't remember the name. If the committee includes ASL then those who advocate the other language will want it included. Representative Bunde said he thinks it would cover most people if the wording, "ASL sign language" were to be included, which is taught in schools. He stated that you can get a degree in ASL at the University of Alaska - Anchorage. CHAIRMAN GREEN asked Representative Bunde if that is a friendly amendment to Amendment 2. REPRESENTATIVE BERKOWITZ said, "We've said oral conversation that would include English, Spanish, Yupik, Yupiit, Yup'ik. There are different types of sign language, there's French, there is English, there is American. Sign language is just a means of communication for people who are not communicating orally." Representative Berkowitz said another point is he would think the Americans with Disabilities Act (ADA) and the equal protection clause would compel the committee to make some kind of accommodation. CHAIRMAN GREEN asked Representative Berkowitz if he considers the suggestion by Representative Bunde a friendly amendment. Number 0836 REPRESENTATIVE BERKOWITZ said he considers it an extended hand, it come part of the way but not fully. REPRESENTATIVE BUNDE explained that somebody who uses ASL can also converse in French. He pointed out that ASL is a style as much as a vocabulary. CHAIRMAN GREEN asked if the concept of sign language would cover the issue even though it may not be a specific kind. Somebody must be able to understand it otherwise you don't have communication. REPRESENTATIVE PORTER indicated he would think about "ASL," but the term "sign language" gets back to an example of himself and Representative Croft talking in a corner and one of them decides to put up three fingers to indicate something. That is communication with sign. He asked where it begins and stops. Number 0899 REPRESENTATIVE ROKEBERG said, "I would like to know if this includes disallowing or making it legal of steeling of baseball signs. That's what it would do." He said he objects to the amendment. REPRESENTATIVE BERKOWITZ said if you were playing ball in a company yard, you don't have any expectation of privacy in those signs. REPRESENTATIVE BUNDE made a motion to amend Amendment 2 to add the term "ASL." REPRESENTATIVE ROKEBERG objected. REPRESENTATIVE BUNDE said that "ASL" would be a substitute for "sign language." CHAIRMAN GREEN asked if it would say "or ASL." REPRESENTATIVE BUNDE said where it says "or sign language," say "or American sign language." CHAIRMAN GREEN clarified that the amendment to the amendment would include the word "American" in front of "sign language." He stated the objection is maintained. CHAIRMAN GREEN asked for a roll call vote on the amendment to Amendment 2. Representatives Berkowitz, Rokeberg, Porter, Green and James voted against the amendment to the amendment. Representatives Bunde and Croft voted in favor the amendment to the amendment. So the amendment to Amendment 2 failed to be adopted by a vote of 5 to 2. CHAIRMAN GREEN indicated there was an objection to the adoption of Amendment 2. He requested a roll call vote. Representatives Bunde, James, Porter, Rokeberg and Green voted against the adoption of Amendment 2. Representatives Berkowitz and Croft, voted in favor of Amendment. Amendment 2 failed to be adopted by a vote of 5 to 2. Number 1078 REPRESENTATIVE CROFT offered Amendment 3 which read: Page 2, line 6, following "employer": Insert "; or (3) an area or compartment used to store and employee's personal belongings" REPRESENTATIVE ROKEBERG objected. REPRESENTATIVE CROFT said you either agree that I have the right to go back and look through Roxanne's's purse or you don't. He named the amendment the "purse amendment." REPRESENTATIVE ROKEBERG pointed out that the amendment doesn't say "purse." It says in a compartment or area and that's why the provisional contracts are in the bill. REPRESENTATIVE BERKOWITZ said it the area used to store personal belongings such as the locker you give them or the purse they have in the file cabinet. REPRESENTATIVE ROKEBERG said a purse is not business (indisc.). You have an expectation of privacy. Number 1137 CHAIRMAN GREEN informed the committee members the problem he has with the amendment is it would preclude any random searching for drugs. He indicated he believes that has been upheld. REPRESENTATIVE CROFT said he thinks that random searching for drugs could not be allowed under the amendment unless there is some reason. REPRESENTATIVE BUNDE stated that it probably would be in an employer's best interest to say that, as a policy, we will do random drug inspections in personal lockers. He referred to Representative Croft's amendment and said there is a question as to whether the employer would be able to do that or not. REPRESENTATIVE CROFT said he doesn't think they could do a random search under the amendment. He said, "They could do a individualized reason to..." REPRESENTATIVE PORTER said it has been established that they have an expectation of privacy in this area. It doesn't say, "except" unless it's taken away by (indisc.) the employer. REPRESENTATIVE CROFT said, "Even recognize reasonable expectations of privacy, once you get there it ain't 100 percent even then. I mean you can then -- that's the first part of it. Is there a reason then to infringe upon it? So you can have justifiable reasons too. If you don't have any reasonable expectation of privacy, there is no protections at all. It's just public. Even with a reasonable expectation of privacy, there's no protections at all, it's just public. Even with a reasonable expectation of privacy, ... there are then legitimate reasons to infringe it." Number 1259 CHAIRMAN GREEN asked Representative Rokeberg if he still maintains his objection to Amendment 3. REPRESENTATIVE ROKEBERG responded in the affirmative. CHAIRMAN GREEN requested a roll call vote. Representatives Rokeberg, Porter, James, Bunde and Green voted against the amendment. Representatives Berkowitz and Croft voted in favor of the amendment. Amendment 3 failed to be adopted by a vote of 5 to 3. Number 1296 REPRESENTATIVE CROFT stated the sponsor's representative has stated that it is not supposed to be residential. He said he has seen some business premises, off-site locations, where you're sleeping in bunk beds. He suggested including a conceptual amendment that says, "non-residential" wherever it is appropriate. It addresses Representative James' dormitory concern and a number of other situations. REPRESENTATIVE BUNDE referred to the construction of the pipeline and said he thinks the company has a right to search rooms for contraband. He said he thinks the amendment would preclude that. REPRESENTATIVE ROKEBERG said, "As part of the record I'm (indisc.) memorandum from Terry Cramer, legislative counsel, on March 24th, indicating (indisc.--mumbling) privacy even to housing supplied to an employee by an employer. As I discussed with Jan on the telephone this unintended extension of the bill to a person's living quarters (indisc.--mumbling) against a constitutional challenge based on an individuals right of privacy. Amendment A.3 clarifies that the bill applies only to business premises in this amendment (indisc.) the bill is so limited in scope. We talked about this in the original draft of the bill. This is only on business premises (indisc.) of this bill does not apply to those areas used for residential use or domicile (indisc.)." REPRESENTATIVE CROFT said there should be no objection to the amendment. He said he is trying to clarify that it is in the record. Not everybody goes back to the words said in the committee meetings. CHAIRMAN GREEN indicated that on the North Slope, they do random searches and have the right. He noted that it may be by contract or an agreement. The amendment, he believes, would preclude that. Number 1472 REPRESENTATIVE ROKEBERG stated that he doesn't want to hinder any of the existing policies, contracts or agreements that are in place. That is why the bill specifically provides for contractual agreements. The purpose of the legislation is to make sure companies have policies in place. There are certain circumstances where they will want to be able to have access to those (indisc.). REPRESENTATIVE BERKOWITZ how it will work at sea on a ship. REPRESENTATIVE ROKEBERG said he thinks the same answer would apply to a vessel. CHAIRMAN GREEN asked about a vessel being licensed with the state of Alaska. He said if it is at high-sea, is it considered within the state. CHAIRMAN GREEN asked for a roll call vote on Amendment 4. Representatives Bunde, James, Rokeberg and Green voted against the amendment. Representatives Berkowitz and Croft voted in favor of the amendment. So Amendment 4 was failed to be adopted by a vote of 4 to 2. Number 1693 REPRESENTATIVE CROFT indicated he had another amendment. He said, "In a specific written agreement they have no privacy. I just -- a conceptual amendment that there will be some notice to the employee of what things they can or intend to bug ... we're going to randomly search your locker, we monitor phone calls or we don't. Whatever it is that they're doing in this area they tell them. One page, if they're doing a lot of it more. I wouldn't think it would be a big burden on small employers. But to say if we're going to be infringing on some of these areas, we search your hard disk once every month for stuff. Don't have to tell them what it is, you may not even have to tell them once every month but tell them..." CHAIRMAN GREEN said, "...you're subject to it." REPRESENTATIVE ROKEBERG said he strongly objects as he believes in paperwork reduction. He doesn't believe in adding more burdens or giving notice for doing something you have a common law right to do now. Number 1765 REPRESENTATIVE BERKOWITZ said if there is a common law right, it seems that the common law expectation of privacy would be taken away. If something is being taken away from people, they should at least be told about it. REPRESENTATIVE ROKEBERG said you could develop any number of scenarios and make that argument one way or another. If you start requiring notification for activities which are currently being done and upset the course of commerce by adding additional hurdles, it just becomes an additional expense. Representative Rokeberg stated the bill is intended to protect the privacy rights of employees in a large part. He said he doesn't believe there needs to be anymore hurdles. REPRESENTATIVE BERKOWITZ stated it is a very (indisc.) way to protect employee privacy rights - to take away their expectation of privacy. REPRESENTATIVE ROKEBERG said he objects to Representative Berkowitz's statement. That is not what the intent of the bill is. CHAIRMAN GREEN requested a roll call vote on the adoption of Representative Croft's conceptual amendment. Representatives Bunde, James and Rokeberg voted against the adoption of the amendment. Representatives Berkowitz, Croft and Green voted in support of the amendment. The amendment failed to be adopted by a vote of 3 to 3. Number 1899 REPRESENTATIVE JAMES made a motion to move HB 319, as amended, out of committee with individual recommendations and with the attached fiscal notes. REPRESENTATIVE BERKOWITZ objected. He said he thinks this is a very peculiar way for the legislature to implement the people's right to privacy. He stated he understands that businesses need to have ability to monitor their employees -- the preferable way for them to articulate exactly what it is they're going to do and specify where the employee's expectation of privacy is diminished. Representative Berkowitz explained the bill turns his notion of privacy on its head. It says that he doesn't have privacy unless someone gives it to him. REPRESENTATIVE JAMES explained she believes the legislation is an excellent way to give employers the control over the people who are in their employ, while still allowing them to maintain the expectation of privacy on the issues that really matter. The legislation is a good way to address that. CHAIRMAN GREEN asked for a roll call vote. Representative Rokeberg, James, Bunde and Green voted in favor of moving the bill. Representatives Berkowitz and Croft voted against moving the bill. So CSHB 319(JUD) moved out of the House Judiciary Standing Committee. HB 452 - NONPROFIT CORPORATIONS DISCLOSURES Number 2070 CHAIRMAN GREEN announced the next item of business would be HB 452, "An Act relating to registration, disclosures, and reports by certain nonprofit corporations." As sponsor, he called upon Jeff Logan to explain changes in the new proposed committee substitute. Number 2085 JEFFREY LOGAN, Legislative Assistant to Representative Joe Green, Alaska State Legislature, reminded members that at the previous hearing he had illustrated how money from organizations outside of Alaska is directed to in-state organizations for the purpose of affecting or steering public policy debates one way or another. The proposal was to require disclosure by the outside or foreign corporations when they donated large sums of money. Mr. Logan noted that testimony from the Division of Banking, Securities and Corporations had been that such an arrangement would be virtually unenforceable. He stated, "However, we heard support from the committee for the end result, for the policy goal that would be achieved by such a law." As a result, he said, they had worked with the division and the drafter, and had come up with Version F, 0-LS1324\F, Bannister, 4/27/98. MR. LOGAN went through the bill section by section. He told members Section 1 simply amends AS 10.20.325 to include failing to file the disclosure report required by the new Section 5 of this bill, as a reason for involuntary dissolution by the commissioner. It lists that offense with several others. Mr. Logan said this is substantially conforming language. Number 2245 MR. LOGAN advised members that Section 2 says the commissioner's power to dissolve ceases if the report is filed in a timely manner. Section 3 addresses not the corporations themselves but the organizations doing business in the state under a certificate of authority; it allows the commissioner to revoke the certificate if the report required by Section 5 of the bill is not filed. Section 4 limits the commissioner's power to do so if the report is filed. Number 2300 MR. LOGAN reported that Section 5 is the substance of the bill. It states that a public benefit corporation that is a domestic or foreign corporation transacting business in the state, that has received an aggregate of $5,000 or more during the calendar year, shall file with the department, by July 1 of each year, on forms provided by the department, a report that lists the payments received. He noted that the $5,000 is the same threshold used in the previous bill version. The list must include the name and address of the corporation, the amounts of the payments, and their purpose. On page 3, line 27, it also adds definitions of "foreign nonprofit corporation," "nonprofit corporation," and "public benefit corporation." Section 6 contains conforming language. Number 2401 REPRESENTATIVE ROKEBERG mentioned the $7.5 million general fund fiscal note. CHAIRMAN GREEN said that was an error and should read 7.5 thousand dollars, for notification. He had talked with people in the Department of Commerce and Economic Development, and he said less notifications have been absorbed by the departments, using the words "essentially no additional impact." TAPE 98-77, SIDE A Number 0006 REPRESENTATIVE JAMES asked what "foreign" means for a corporation. CHAIRMAN GREEN said it means anything outside of the state. Number 0057 REPRESENTATIVE ROKEBERG referred to page 4, Section 6, and asked whether failure to file applies to all of these, with only a $5 penalty. MR. LOGAN said this question came to the sponsor's attention as well. People at the division had informed them that this penalty is in addition to the filing fee. Usually the filing fee is $15, and if a corporation files late, it would be a total of $20. Number 0128 REPRESENTATIVE ROKEBERG suggested there is no hammer here. CHAIRMAN GREEN indicated the hammer would be the threat of losing their license, unless the committee wanted to create a significant fine. He noted that unfortunately a corporation could refile with a new name. Number 0299 REPRESENTATIVE CROFT agreed that the ultimate hammer is the involuntary dissolution. He made a motion to adopt a conceptual amendment, on page 3, lines 17, 19, 20 and 22, to remove "nonprofit," so that it would say "foreign corporation." He added that they would not need lines 27 through 30, page 3, anymore, because they already know what "foreign corporation" means. Number 0293 REPRESENTATIVE ROKEBERG and CHAIRMAN GREEN objected. REPRESENTATIVE CROFT explained that what is good for the goose is good for the gander. To the extent they want to know who is contributing to and influencing decision making of public benefit corporations, they also need to know about profit-making foreign entities that contribute. They need to know, regardless of whether it is the Rockefeller Foundation or Exxon or any other major business entity. Representative Croft noted that people outside of the state have interests in the state on both sides of issues. Whatever burden it adds, he said it is important to do for both nonprofit and for-profit corporations that intend to influence issues. Number 0401 REPRESENTATIVE ROKEBERG said he would assume the amendment would gut the bill. He asked whether they were deleting "nonprofit" or adding "profit." REPRESENTATIVE JAMES pointed out that it would only be for the contributor. Number 0446 REPRESENTATIVE CROFT specified that it was to delete "nonprofit," so that any public benefit corporation that receives money would reveal the foreign corporation sources, whether nonprofit or for- profit. CHAIRMAN GREEN said he had misunderstood, and he apologized. He suggested people know why for-profit corporations contribute, however. Number 0523 MR. LOGAN added that throughout the law, for-profit and nonprofit corporations are treated entirely differently. Nonprofit corporations are essentially tax-free corporations, and society has made a deal with these groups, which are supposed to do essentially benevolent and beneficial things with this money, not use it for political purposes. Mr. Logan said these entities are not the same and shouldn't be treated the same way. Number 0602 REPRESENTATIVE BUNDE suggested they basically want to follow the money for nonprofits. If some major corporation wants to influence a nonprofit in Alaska, for good or ill, but Alaskans don't know who is pulling the strings, nothing prevents them from creating a nonprofit and then "laundering" the money through that. This would shorten the laundry list a little bit by taking out the nonprofit end. If some major corporation was putting money into a nonprofit, this would give a better idea of who they were. He said he didn't know that it is absolutely needed, but he doesn't see that it causes any harm. CHAIRMAN GREEN said the concern is that under a benign name, the message might be different from the name. Number 0696 REPRESENTATIVE JAMES stated that Representative Croft's amendment certainly has merit, because this legislation requires nonprofits or public benefit corporations operating within Alaska to report where they got their money, if it is $5,000 or more. To only include money received from foreign nonprofit corporations doesn't tell the whole story. She pointed out that it would not be a burden for the for-profit corporations, because it would be the public benefit corporation within the state doing the reporting. Number 0820 REPRESENTATIVE ROKEBERG proposed that they shouldn't delete "nonprofit" but should add "for-profit." REPRESENTATIVE JAMES suggested they could do it either way. Number 0857 REPRESENTATIVE CROFT concurred. He said he thinks they both do the same thing, but if there is some legal, technical or other reason, they could use "foreign nonprofit and for-profit corporations." Number 0876 REPRESENTATIVE BERKOWITZ asked why they are excluding individuals. He said in a way this is a lot like the campaign disclosure requirements. He suggested the best antidote is to disclose, which allows people to review information and make their own determinations. Number 0936 MR. LOGAN said initially the problem defined involved large foreign corporations called foundations that provide large sums of money. He said if they had seen a problem with individuals, he supposed they would have been incorporated into the draft. Number 1052 REPRESENTATIVE ROKEBERG agreed with Representative Berkowitz regarding the follow-the-money theory, mentioning a possible limitation like the $250 used by the Alaska Public Offices Commission (APOC). He also expressed concern about the language, "derives more than 10 percent of its annual income from donations", noting that some foundations are entirely self-funded. MR. LOGAN suggested a representative from the division could clarify that. He said that language is from the American Bar Association model nonprofit corporations code, and it is the definition of a public benefit corporation. He added, "And, again, I'm not sure that an organization that is organized under this chapter, and that meets ... (B), 'derives more than 10 percent of its annual income from donations,' is the problem." Number 1140 REPRESENTATIVE JAMES said her concern is that whenever they pass legislation, it ought not to be just for a specific purpose. There are public benefit corporations that are not necessarily controversial. She suggested there could be a benefit to some larger for-profit corporations from the reporting because it would be picked up by the news media. Representative James said she likes the idea of having everything that is in aggregate over $5,000 be reported annually for these public benefit corporations, whether it comes from nonprofit or for-profit corporations. However, she questioned the value of having individuals in there, and the benefit of just knowing a person's name. She said they shouldn't lose track of the reason for doing this, which is knowledge of where the money comes from that tries to affect policy or public attitudes. Number 1276 REPRESENTATIVE ROKEBERG referred to individual foundations and suggested use of the word "person" would catch all. He said he can think of many individual foundations that don't receive contributions, at least not 10 percent of their annual income. He cited examples. REPRESENTATIVE CROFT pointed out that it says "or." REPRESENTATIVE BERKOWITZ specified that it is on page 4. Number 1342 CHAIRMAN GREEN called a brief at-ease, then called the meeting back to order. He offered a friendly amendment, "that throughout where we have 'from a foreign nonprofit corporation,' that we just drop 'foreign nonprofit' and say ... whether it's contributions from corporations." REPRESENTATIVE CROFT agreed to that. REPRESENTATIVE JAMES noted that it would cover in-state and out-of- state corporations both. CHAIRMAN GREEN said in-state, out-of-state, for-profit and nonprofit. Number 1386 REPRESENTATIVE BERKOWITZ suggested it would require a title change. CHAIRMAN GREEN concurred. REPRESENTATIVE ROKEBERG noted that subsection (1) on the bottom of page 3, the definition of "foreign nonprofit corporation," would be deleted. CHAIRMAN GREEN agreed, specifying that they would delete lines 27 and 28 of page 3. Number 1402 REPRESENTATIVE BERKOWITZ pointed out that they are picking up all kinds of groups, including churches. MR. LOGAN said under the definition listed on page 3, line 31, a public benefit corporation does not include a religious organization. REPRESENTATIVE ROKEBERG asked why it wouldn't include a church. MR. LOGAN replied that a religious organization is not organized for a public or charitable purpose. REPRESENTATIVE CROFT said it is an "or." Number 1441 REPRESENTATIVE BERKOWITZ suggested it would also sweep up things like boys' and girls' clubs, Special Olympics, and so forth. MR. LOGAN asked someone from the department to correct him if he was wrong, then said he believes those organizations would be defined as mutual benefit corporations. REPRESENTATIVE BERKOWITZ expressed concern that they might be putting a burden on apolitical organizations. Number 1501 REPRESENTATIVE ROKEBERG inquired about putting in mutual benefit corporations and defining them, so that there is clear statutory grounds for those reading the law. He asked whether it is already in statute. Number 1530 MR. LOGAN replied that he doesn't believe it is in statute, and he isn't sure the drafters would add it if it isn't referred to in the bill. He suggested saying a public benefit corporation does not mean a mutual benefit corporation. CHAIRMAN GREEN said that would be a good idea. He suggested including that as part of subsection (3), in the same conceptual amendment. Number 1559 REPRESENTATIVE CROFT replied that he would prefer to keep it clean. He proposed doing that as a second amendment. Number 1565 CHAIRMAN GREEN agreed to that. Noting that conceptual Amendment 1 was dropping "foreign nonprofit", he asked whether there was an objection. There being none, Amendment 1 was adopted. Number 1588 REPRESENTATIVE ROKEBERG made a motion to add, in the vicinity of lines 6 and 7 on page 4, the exclusion of mutual benefit corporations, and to add a definition, as appropriate, for mutual benefit corporations, with the understanding that these are usually religious, youth and other activities. He asked Mr. Logan where that is defined. MR. LOGAN replied that it is an organization organized for the mutual benefit of its members, such as a country club or a booster club at the high school. It is defined in the American Bar Association model nonprofit corporations code. Number 1635 CHAIRMAN GREEN agreed to use that definition. He asked whether there was any objection to Amendment 2; there was none. REPRESENTATIVE BUNDE questioned whether the $15 registration fee would cover paperwork costs. He said he didn't want to make an amendment, then suggested the House Finance Committee get testimony about the actual cost and have the application fee reflect that. CHAIRMAN GREEN said that seems reasonable. MR. LOGAN noted that the bill has no House Finance Committee referral because there is not a fiscal note. CHAIRMAN GREEN added that there is a zero fiscal note to offset the $7.5 million error. Number 1677 REPRESENTATIVE BUNDE recommended that some note go along with the bill, in case it gets to the House Finance Committee. CHAIRMAN GREEN responded, "If it ends up there, we certainly shall." Number 1714 REPRESENTATIVE BUNDE made a motion to move HB 452 [Version F, as amended] from committee with individual recommendations and attached fiscal note. CHAIRMAN GREEN asked whether there was any objection. There being none, CSHB 452(JUD) moved from the House Judiciary Standing Committee. CSSB 284(STA) - CRUELTY TO ANIMALS Number 1759 CHAIRMAN GREEN announced the final item of business would be CSSB 284(STA), "An Act relating to cruelty to animals." Number 1774 REPRESENTATIVE BUNDE made a motion to move CSSB 284(STA) from committee. REPRESENTATIVE JAMES noted that it would be with individual recommendations and any attached fiscal notes. CHAIRMAN GREEN asked whether there was any objection. There being none, CSSB 284(STA) moved from the House Judiciary Standing Committee. ADJOURNMENT Number 1822 CHAIRMAN GREEN adjourned the House Judiciary Standing Committee meeting at 3:08 p.m.