Legislature(1999 - 2000)
05/06/1999 08:11 AM House STA
| Audio | Topic |
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE STATE AFFAIRS STANDING COMMITTEE
May 6, 1999
8:11 a.m.
MEMBERS PRESENT
Representative Jeannette James, Chair
Representative John Coghill
Representative Scott Ogan
Representative Beth Kerttula
Representative Harold Smalley
MEMBERS ABSENT
Representative Jim Whitaker
Representative Bill Hudson
COMMITTEE CALENDAR
SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 179
"An Act eliminating the Alaska Public Offices Commission and all
campaign contribution and expenditure limits; transferring the
administration of lobbying, conflict of interest, and financial
disclosure statutes from the Alaska Public Offices Commission to
the division of elections; relating to reporting of campaign
contributions and expenditures; defining 'full disclosure,'
'purposely,' 'recklessly,' and 'resident'; amending the definition
of 'contribution,' 'group,' and 'political party'; changing the
residency requirements for candidates for public offices; and
providing for criminal penalties for violation of these
provisions."
- HEARD AND HELD
(* First public hearing)
PREVIOUS ACTION
BILL: HB 179
SHORT TITLE: APOC REPEAL: CAMPAIGN/DISCLOSURE/LOBBYIST
SPONSOR(S): REPRESENTATIVES(S) COGHILL, Sanders
Jrn-Date Jrn-Page Action
4/07/99 671 (H) READ THE FIRST TIME - REFERRAL(S)
4/07/99 671 (H) STA, JUD, FIN
4/15/99 (H) STA AT 8:00 AM CAPITOL 102
4/15/99 (H) <BILL CANCELED>
4/19/99 866 (H) SPONSOR SUBSTITUTE INTRODUCED
4/19/99 866 (H) READ THE FIRST TIME - REFERRAL(S)
4/19/99 866 (H) STA, JUD, FIN
4/22/99 (H) STA AT 8:00 AM CAPITOL 102
4/22/99 (H) HEARD AND HELD
4/27/99 (H) STA AT 8:00 AM CAPITOL 102
4/27/99 (H) BILL CANCELED
4/29/99 (H) STA AT 8:00 AM CAPITOL 102
4/29/99 (H) HEARD AND HELD
4/29/99 (H) MINUTE(STA)
5/06/99 (H) STA AT 8:00 AM CAPITOL 102
5/06/99 (H) HEARD AND HELD
WITNESS REGISTER
RYNNIEVA MOSS, Legislative Assistant
to Representative Coghill
Alaska State Legislature
Capitol Building, Room 416
Juneau, Alaska 99801
Telephone: (907) 465-4530
POSITION STATEMENT: Provided information on HB 179.
MARTIN SCHULTZ, Assistant Attorney General
Civil Division
Governmental Affairs Division
Department of Law
1031 West Fourth Avenue
Anchorage, Alaska 99501
Telephone: (907) 269-5156
POSITION STATEMENT: Provided information on HB 179.
BROOK MILES, Regulation of Lobbying
Alaska Public Offices Commission
Department of Administration
P.O. Box 110222
Juneau, Alaska 99811-0222
Telephone: (907) 465-4864
POSITION STATEMENT: Provided information on HB 179.
ACTION NARRATIVE
TAPE 99-34, SIDE A
Number 0001
CHAIR JEANNETTE JAMES called the House State Affairs Standing
Committee meeting to order at 8:11 a.m.. Members present at the
call to order were Representatives James, Coghill, Ogan, Kerttula
and Smalley.
HB 179-APOC REPEAL: CAMPAIGN/DISCLOSURE/LOBBYIST
CHAIR JAMES announced that the only order of business before the
committee is SSHB 179 "An Act eliminating the Alaska Public Offices
Commission and all campaign contribution and expenditure limits;
transferring the administration of lobbying, conflict of interest,
and financial disclosure statutes from the Alaska Public Offices
Commission to the division of elections; relating to reporting of
campaign contributions and expenditures; defining 'full
disclosure,' 'purposely,' 'recklessly,' and 'resident'; amending
the definition of 'contribution,' 'group,' and 'political party';
changing the residency requirements for candidates for public
offices; and providing for criminal penalties for violation of
these provisions." She mentioned that the committee has two
versions of SSHB 179 before them.
Number 018
REPRESENTATIVE COGHILL pointed out that the difference between the
version before the committee yesterday and today's version is that
the language was not kept consistent with the change from
"division" to "center."
Number 033
REPRESENTATIVE OGAN moved to adopt proposed CSSSHB 179, version
LS0401\I, as the working document before the committee. There
being no objection, it was so ordered.
REPRESENTATIVE COGHILL explained that there are several changes
which resulted from testimony, suggestions from committee members,
and additional language making SSHB 179 clearer. He referred to
the title on page 1 and noted that it is still an Act eliminating
the Alaska Public Offices Commission. However, the same acronym,
APOC, is utilized for the establishment of the Alaska Public
Offices Center which remains within the Division of Administration.
Representative Coghill mentioned that the three major principles he
chose to guide the movement of this particular bill are maintained.
The bill maintains the separation of powers between the judiciary
and the administrative aspects, while allowing for open disclosure
and no limits, although there are some regulations as to how those
funds can be spent and reported. He noted that the public offices
center will be adjacent to the Division of Elections affording a
possible candidate the ability to apply for candidacy near where
the reporting takes place.
REPRESENTATIVE COGHILL referred to Section 1, paragraph (1), "the
purpose of campaign disclosure is to make available to Alaskan
voters all information concerning contributions and expenses of
political candidates" which he identified as the intent behind this
legislation. The legislation also hopes to, as paragraph (2)
states, "...to make campaign laws less ambiguous and burdensome to
both the candidates and to their supporters" which provides a
clearer environment. He continued with the purpose discussed in
paragraph (3), "the purpose of this Act is to produce a simplified
reporting system that is less intrusive and gives optimal freedom
with fair accountability. The aim is to arrive at full disclosure
...."
Number 117
REPRESENTATIVE COGHILL explained that Section 3 is existing
statute. He noted that Section 3 repeals AS 15.13.020, which
established the [Alaska] Public Offices Commission. Section 3
would de-politicize those working within the [Alaska] Public
Offices Center. Section 4 outlines the duties of the center, such
as preparing the forms and displaying the reports.
CHAIR JAMES commended Representative Coghill for his work and noted
this is a drastic change that will require a lot of work to bring
people along on this issue. She agreed with the "Findings and
Purpose" of the legislation which she believed had much merit. She
commented that the public has indicated the need for less rules and
regulations leaving the public to decide whether a candidate is
honest or not from the disclosure. Chair James announced that she
would like to move SSHB 179 onto the House Judiciary Committee.
REPRESENTATIVE COGHILL referred to page 23, Section 24.45 which
relates to lobby regulations, noting that the word "Center" is
added which would also be the case on page 33, AS 39.50 which deals
with conflict of interest. Those are really changes in address
versus substantive changes.
Number 208
CHAIR JAMES clarified that the additions in those cases are the
same as they are currently, except for the change in title.
REPRESENTATIVE COGHILL agreed. He referred to page 6, Section 5
which was taken, for the most part, from the current APOC
regulation with regard to contributions. Section 5 also outlines
what one would have to report on the form provided by the center.
He pointed out that there is a provision that allows for the form
to be provided electronically or by hard-copy. He referred to page
4, line 21, noting that language requiring a report of the
aggregate of those contributions under $100. He noted that the
same criteria utilized for contributions is utilized for loans as
well.
Number 252
REPRESENTATIVE COGHILL explained that page 4, subparagraph (E)
deals with detailing records. He noted that the bookkeeping system
was taken from the APOC as it is currently in order to allow for
inspection. He moved to Section 6, page 6, and stated, "Those who
are going to oppose or support a candidate before they can make an
expenditure in support of or opposition, they need to come to the
APOC, the center, and register that they are in fact doing that."
CHAIR JAMES inquired as to who "each person" refers in Section
6,"(a) Before making an expenditure in support of or in opposition
to a candidate or before making an expenditure in support of or in
opposition to a ballot proposition or question, each person other
than an individual shall register."
Number 287
RYNNIEVA MOSS, Legislative Assistant to Representative Coghill,
explained that the definition of "person" includes groups,
political parties, and those that would have to register.
REPRESENTATIVE COGHILL pointed out that the definition section
begins on page 20.
REPRESENTATIVE COGHILL continued with Section 7 which deals with
campaign treasurers. The candidate is assumed to be the treasurer
if no treasurer is appointed. Section 7 also specifies that those
running a campaign for a ballot issue, or some other issue, also
have to have a treasurer. He moved on to Section 8 regarding
audits. He said, "...starting in (c) on line 18, if there is a
'failure, refusal or neglect to cooperate with the Center by a
candidate, group, political party, municipality, or individual
could result a person being fined and/or convicted.' And what we
wanted to do was we wanted to take it out of the center's hands by
saying, if you find in an audit then under [AS 15] 13.125 and [AS
15] 13.170, a civil or criminal action could ensue. It goes out of
the hands of the department at that point, or the center, and goes
over for court action."
CHAIR JAMES said that would assume that it's not automatically
going to court action or would somebody have to file an action.
Number 334
REPRESENTATIVE COGHILL confirmed that an action would have to be
filed, either by the center or by an individual. The center would
only show that there was probable cause, but would not begin the
action. He added that there could be civil penalties which are
outlined in SSHB 179 regarding late filing. If there is an
accusation, this provides the center the opportunity to say, "Bring
your books and let's take a look at them."
CHAIR JAMES commented that Representative Coghill seems to desire
full disclosure. She asked if the center found irregularities,
would such be recorded on the Internet so that the general public
has access to that information.
REPRESENTATIVE COGHILL replied yes. If there is a violation, that
is on the record for open disclosure.
CHAIR JAMES asked if a violation would appear on the Internet
before the candidate had an opportunity to defend himself or
herself. Would the center contact that candidate with regards to
a violation?
REPRESENTATIVE COGHILL explained that the legislation includes a
provision requiring the center to notify the candidate within five
days of a challenge or failure to disclose. Before any action
begins, notification must occur. There is also a civil penalty
that will ensue and can be appealed, if the records are shown to be
in order.
Number 400
CHAIR JAMES expressed concern with the notion of "innocent until
proven guilty." She did not have a problem with drawing attention
to something, but she did not want there to be an assumption that
there is a violation until such a determination has been made.
REPRESENTATIVE COGHILL noted that determining when to "put a flag
up on the screen or the file" was a struggle. The five-day
notification process provides a week for response. He commented
that in a political race weeks are very important.
CHAIR JAMES asked if under this full disclosure, would the exchange
between the center and the candidate be on the candidate's file. If
a candidate missed a filing deadline for health reasons or a death
in the family, would the five day notice go in the candidate's file
for the public to review. If the candidate responds to the center
with one of the aforementioned excuses, would that be filed for the
public to review as well.
REPRESENTATIVE COGHILL replied that there is not a provision for
such a communication to be on the Internet. He said that he was
primarily interested in ensuring that the transactions for
expenditures, contributions, and failure to disclose were
addressed.
CHAIR JAMES pointed out that there are as many complaints about
APOC as there are about the candidates or the contributors. She
believed that if there is going to be full disclosure, the
communication between APOC and the candidate should be on the
candidate's report for public review.
Number 470
REPRESENTATIVE OGAN expressed concern with Section 26, which reads,
"A qualified Alaska resident may bring civil action and/or file a
complaint for criminal action with the district attorney to enforce
any of the sections of this chapter." He foresaw someone filing
a criminal action for the sake of discrediting the name of the
candidate which would result in legal fees and other complications.
CHAIR JAMES asked if that was currently allowed.
REPRESENTATIVE OGAN pointed out that it is a new section.
REPRESENTATIVE COGHILL clarified that cause would have to be shown
and then the proof is on failure to disclose. There are criteria
for civil and criminal action in this as well as civil penalties.
He believed an individual would have to have a clear case based on
this law to bring a civil action for failure to disclose.
Number 502
CHAIR JAMES asked if SSHB 179 makes it easier or more difficult for
a candidate to do that than in existing law.
REPRESENTATIVE COGHILL said he could not answer that.
REPRESENTATIVE OGAN said that he believed the commission has the
authority to recommend whether or not there is a criminal violation
under the current language. He further stated, "You take a look at
the ethics charges that go on in a campaign, you get into a really
close race - and I can think of one ... and suddenly these ethics
charges brought against different candidates and a lot of times
people do that as a political strategy rather than any substantive
charges." He predicted that this would be used as a political tool
against candidates.
CHAIR JAMES asked if SSHB 179 included a restriction regarding when
such things can be filed during an election.
REPRESENTATIVE COGHILL replied yes.
CHAIR JAMES asked if everything in a campaign is listed on the
candidate's report and is available for public review, wouldn't
that place the onus on the person making the charge as opposed to
giving protection to the person who is not.
Number 542
REPRESENTATIVE KERTTULA stated that this would actually allow a
person to file a formal complaint for even criminal action. She
further stated, "I've never seen it happen and ... I'm sure it
wasn't in the APOC statute - before you'd have to go through the
district attorney's office to screen to be able to file a criminal
(indisc.--simultaneous speech)." Representative Kerttula agreed
with Chair James regarding the reporting, but noted that this
allows the case to be brought forth.
REPRESENTATIVE COGHILL commented that the legislation may be
off-base on that point. Bringing a civil action is well within
your limits, but bringing a criminal action still has to go through
the district attorney.
CHAIR JAMES inquired as to how things that have been published in
the newspaper over the years would have been different if full
disclosure had been in place.
Number 573
REPRESENTATIVE COGHILL stated, in his view, that full disclosure
comes with a higher degree of responsibility. Therefore if this is
open to the public and a problem is found, there should be
recourse. He did not believe that to be frivolous because one
would still have to go before a judge. Representative Coghill
agreed with Representative Ogan's point that somebody could just
make a charge which would be damaging, just as is the case in
accusations of child abuse sometimes the entire story is never
heard.
REPRESENTATIVE OGAN commented that full disclosure already exists.
CHAIR JAMES agreed there is full disclosure, however, that
information is not current. Much time passes between the reporting
deadlines. She also indicated the need to report who pays for a
candidate's television time.
REPRESENTATIVE KERTTULA noted that is reported.
CHAIR JAMES reiterated there is a long period of time during the
campaign before the 30-day report is required and nobody knows what
is happening during that time. She expressed concern with that
time period.
Number 628
REPRESENTATIVE COGHILL commented that, from his understanding, the
contributors and voters do not know the contribution limits or the
laws which apply to contributions. This legislation eliminates the
limits and makes it open immediately so that the public has the
ability to make that judgement call which he believed provided a
higher degree of accountability.
CHAIR JAMES informed the committee that she likes full disclosure
and does not have a problem with reporting every half a month, but
in order to achieve such something must be offered. If the limits
and specific things are lifted, then full disclosure is not so
burdensome and a give-and-take situation would exist.
REPRESENTATIVE COGHILL referred to page 15, line 23, Section 26,
and asked Representative Kerttula if it would be better on line 23,
after "and or," to insert "formal" so that it would read, "file a
formal complaint for criminal actions with the district attorney to
enforce any of the sections in this chapter."
Number 659
REPRESENTATIVE KERTTULA pointed out that the representative from
the court system might be able to comment on that. However, she
noted that an individual can always file with the district
attorney, which means the individual could phone the district
attorney. Therefore, Representative Kerttula believed that
inserting "formal" might create another process making it more
difficult.
REPRESENTATIVE COGHILL said he is open for discussion, however, the
next committee of referral is the House Judiciary Committee which
may be better able to address that issue.
REPRESENTATIVE SMALLEY referred to Section 4, page 3, lines 12-16
and read the following: "and shall charge an at cost fee for
reports not electronically filed to cover the cost of keying in the
report." Although candidate's should be encouraged to use
electronic filing, there will be situations in which electronic
filing will not be available to a candidate. This would actually
penalize a candidate who is already operating "off a shoestring"
budget or does not have the ability to file electronically which
creates an unfair burden.
REPRESENTATIVE COGHILL said he did not necessarily disagree with
Representative Smalley. He said he was trying to create incentives
for computerized filing and discourage paper flow.
Number 699
REPRESENTATIVE SMALLEY suggested that if the report is not filed
electronically, it could be filed the day prior to electronic
filing.
CHAIR JAMES agreed candidates should be treated equally. She
indicated that a small charge of $10 for someone to electronically
enter a candidate's report would be appropriate.
REPRESENTATIVE COGHILL mentioned that the Division of Elections
charges for lists and the copying of disks. He did not want to
make this a burden to the center, but wanted to provide an
incentive for electronic filing and cover the cost of a lot of
paperwork.
REPRESENTATIVE SMALLEY commented that even a charge of five cents
is an unfair penalty to a candidate that does not have the ability
or lacks the necessary equipment.
CHAIR JAMES stated that everyone could be charged a fee and those
that filed electronically could be excused from the fee.
REPRESENTATIVE COGHILL said he would make note of Representative
Smalley's point.
Number 765
REPRESENTATIVE COGHILL referred to page 9, Section 12 and
reiterated that corporate giving is a problem. After reviewing
what the supreme court said, "That corporations were not primarily
formed for political action," it was determined best to incorporate
language which prohibited corporations, companies, partnerships,
and anything that was not defined as a group or political action
committee. He pointed out that the definition of group is defined
on page 20, line 13 and "political action committee" is defined on
page 21, line 13.
REPRESENTATIVE COGHILL further explained if corporations wanted to
have a PAC, as they can now, that...
Number 795
CHAIR JAMES pointed out that corporations cannot have a PAC
currently and all corporation funds are disallowed.
REPRESENTATIVE COGHILL agreed. He clarified that if somebody
within a corporation wanted to have a PAC, he/she would still have
to have that individual input. Although the PAC could still be
called the "xyz" company PAC, only individuals could contribute to
it and the reporting would be under the group's name.
CHAIR JAMES said that she did not believe this language reflected
that intent.
REPRESENTATIVE SMALLEY inquired as to the location of the
requirement that a PAC be registered.
Number 815
REPRESENTATIVE COGHILL referred to page 6, line 16, Section 6 (a)
which reads, "Before making an expenditure in support of or in
opposition to a candidate or before making an expenditure in
support of or in opposition to a ballot proposition or question,
each person other than an individual shall register, on forms
provided by the Center, with the Center." He also noted that
Section 7 outlines the requirements for the campaign treasurer
which follows the reporting procedure.
CHAIR JAMES referred to the definition of "immediate family," on
page 20, line 17 and inquired as to the meaning of "spousal
equivalent."
REPRESENTATIVE COGHILL said he did not know if "spousal equivalent"
would fall under "spouse" technically and legally, or if "spousal
equivalent" is required.
Number 838
CHAIR JAMES deferred to Martin Shultz, Department of Law.
TAPE 99-34, SIDE B
[Tape flipped early - no testimony was lost; approximately four
minutes of blank tape.]
Number 001
CHAIR JAMES asked, "If we wanted to be sure we treated spousal
equivalent the same way, do we have to specifically say spousal
equivalent, or would they be included in that listing."
Number 022
MARTIN SCHULTZ, Assistant Attorney General, Civil Division,
Governmental Affairs Division, Department of Law, testified via
teleconference from Anchorage. He believed spousal equivalents are
currently set out in some statutes, and those would have to be
specifically included if the desire is to include that group.
REPRESENTATIVE COGHILL confirmed that spousal equivalents would be
added on line 17.
CHAIR JAMES agreed.
CHAIR JAMES asked Mr. Shultz if grandchildren would be considered
"immediate family," if those grandchildren are living in the same
household.
MR. SHULTZ stated that anyone that the committee wishes to include
should be specifically listed. For example, if the committee
wanted to include the spousal equivalent's children that should be
listed as well.
CHAIR JAMES said she believed the definition of "political action
committee" would, for all practical purposes, include corporation
money which she did not think was the intent on page 21, line 14.
She stated, "I think it just means a combination of two or more
individuals. If we're making it only individuals can donate to
PACs and only individuals can donate to groups, then I think you
don't want to say, 'or a person other than an individual,' and then
include them in the PACs. You're allowing a contribution from
someone other than an individual and that would be like corporation
money, association money ... it's always an employee's PAC."
Number 110
REPRESENTATIVE COGHILL suggested then after "individuals" delete
lines 13 and 14, through "which."
CHAIR JAMES agreed. She informed the committee that she did not
see the possibility of moving SSHB 179 out of committee. She
suggested the committee work on the legislation during the interim.
REPRESENTATIVE COGHILL noted another change was made on page 21,
Section 31 regarding the declaration of filing procedure which was
placed within the Division of Elections. The Division of Elections
already has a filing declaration and the affidavit within that was
included in order to simplify the application and reporting
process.
CHAIR JAMES inquired as to the rationale behind allowing a
candidate to file to run and then allowing 15 days to file the
conflict of interest statement. Is it to make filing easier or is
it for last-minute filers? She wondered if filing the conflict of
interest at the same time as the declaration of office is
burdensome.
Number 194
BROOK MILES, Regulation of Lobbying, Alaska Public Offices
Commission, Department of Administration, explained that the filing
of the financial disclosure statement has been required to be
simultaneous with the declaration for office since it was first
voted into law in 1974. Ms. Miles further explained a candidate
files his/her declaration simultaneously with his/her financial
disclosure statement. Fifteen days after that the candidate is
required to file a registration as a candidate providing his/her
campaign address, treasurer and chairman.
CHAIR JAMES asked what was she was rushing to get done in the 15
days after she filed.
MS. MILES replied it would have been the registration statement
which asks for the name of the candidate's campaign, the mailing
address for the campaign, the name of the treasurer or deputy
treasurer which can be amended throughout the campaign. The
registration statement also includes the depository if the
candidate intends to spend more than $5,000 during the course of
the campaign. She noted that information is required within 15
days after filing a state declaration or 7 days after a municipal
candidate files for office. She mentioned that many incumbents
already have their statement on file therefore, this would be of no
concern when the candidate files his/her declaration. Frequently,
an incumbent legislator does not file for office until near the end
of session or after the end of session. If an annual filer wishes
to file a declaration before filing his/her annual financial
disclosure then those have to be filed at the same time which
could occur any time after January 1 before the financial due date
of March 15.
Number 269
REPRESENTATIVE COGHILL mentioned when he filed as a new candidate
he was not aware of all the deadlines and the different reports
that were required. He said he may have failed to submit a report
which he thought he had already submitted. Representative Coghill
explained that he is trying to make sure that when a person
considers filing for office all that information is available.
Representative Coghill further stated, "And it may be that, that
particular day you go down to get the application, you may not file
and I understand it could be burdensome if you wait until the last
minute. But I don't know if we want to accommodate that, I would
rather have the simplicity of having all the filing in one place
and one starting place so that once you do start, it's very clear
to not only to the division, but it's also very clear to the
public. ...there is probably a little more burden borne by the
candidate, but I think in the interest of a clear start and a clear
declaration, I think that the voters would be served by it."
CHAIR JAMES mentioned that an earlier draft did not include a
provision for the intent to file. That previous draft did not
allow any kind of a "war chest" or taking of any contributions from
anyone until the declaration of a candidacy and the conflict of
interest statement had been filed. Does the new version maintain
those provisions?
REPRESENTATIVE COGHILL replied yes.
Number 307
CHAIR JAMES inquired as to why there is an intent to file. If an
individual has an intent to file, that individual can collect
money. What would happen to the money, if the individual decided
not to file? Can anybody file an intent to file?
MS. MILES informed Chair James that anyone can file and can raise
and expend money.
CHAIR JAMES asked Ms. Miles what the general benefit of that is
because SSHB 179 does not include such.
MS. MILES explained that it is just a convenience for filers
because an intent to file temporarily takes the place of a
declaration. She understood with state campaigns, it is not such
an issue because a person can file a declaration for office
whenever they are ready to file that for the next election. She
commented that the representative from the Division of Elections
may have further explanation. She further explained, "But in the
municipal races, which is where we first started using the letter
of intent, the time period where the filing is open with the city
clerk is often very close to the election day, 60 days away or
something. And in some of the larger communities where the races
are very competitive that was viewed as an insufficient, even if
you filed on that first day, it was an insufficient time for
running a competitive campaign. And so we had a letter of intent
for municipal only, that would permit them to begin their fund
raising earlier. Of course the letter of intent originally was all
in place before the campaign finance reform was enacted by the
legislature, but established more clearly and now it's more clearly
still, with the supreme court decision - the 18-month prior to the
election day period."
Number 359
MS. MILES responded to Chair James' question regarding what a
candidate should do with the money should the candidate decide not
to file. Under current law, any money that a candidate has not
spent is disbursed just as any other candidate's campaign is
disbursed. She said, "So, it cannot be taken as personal or used
as personal."
CHAIR JAMES surmised then that SSHB 179, as written, does not
provide for an intent to file and suggested Representative Coghill
may want to review the pros and cons of that.
REPRESENTATIVE COGHILL noted that within the declaration of
candidacy there is the application, registration, and conflict of
interest statement. He explained the reasoning behind that was to
provide the general population with a clear idea of whose filed, a
definite start date, and an affidavit which clarifies that the
candidate is qualified. Representative Coghill acknowledged that
he had not given much thought to the municipality side of this
issue and therefore, would be open to discussion in that area.
Number 403
CHAIR JAMES indicated that she did not feel comfortable enough with
current law to sign a statement indicating that she, as the
language on page 21 paragraph (4) says, "is familiar with the
provisions of this chapter and the penalties for violating a
provision of this chapter." She further indicated the need for
candidates to check the list.
REPRESENTATIVE COGHILL commented that is one of the reasons to have
a definite starting place, a clear open system of open disclosure
with less limits. He clarified that the specified limits relate to
what a candidate can do with the money as far as personal use in
order to ensure that there is a clear understanding with regard to
the candidate's responsibility because the candidate will be held
to a high degree of accountability. This is definitely a change
from the current process. He reiterated that this change is really
to provide a better understanding to the general population. He
did not know that this process is any more difficult for the
candidate, it is merely different. He added that this is also
different for the Division of Elections and APOC. He explained
that taking the limits off giving would eliminate some of the
clouds surrounding what is and is not possible. Once the general
populace understands that, the public will hold the candidates
accountable for that and watch the process. Currently, even the
supreme court has difficulties regarding determinations of what can
and cannot be done due to some of the laws that the legislature has
made.
CHAIR JAMES commented that campaign finance law has been supported
so the public does not have to worry about it; the rules are
established. However, Chair James believed that the responsibility
has been taken away from the public to be responsible about
noticing what candidates are doing instead of just believing what
the newspaper reports.
Number 469
REPRESENTATIVE COGHILL referred to page 13, Section 21 regarding
the use of campaign contributions. He acknowledged the concern
that open disclosure and the lifting of some of the limits would
create "rich people." That concern resulted in the language in
Section 21 which says that campaign contributions cannot be
converted for personal income, cannot be loaned, and purchases must
be at a fair market value (a car cannot be purchased for $10). He
said that the candidate needs to be held accountable for that.
Representative Coghill pointed out that although this legislation
includes some major changes, there are many similarities between
this legislation and the current regulations. He reiterated the
need for a clearer process.
CHAIR JAMES asked if the list of campaign contribution uses in this
legislation is similar to those in existing law.
REPRESENTATIVE COGHILL informed Chair James that the list of
campaign contribution uses was taken out of the regulation. He
noted that the legislation attempts to make it as clear as
possible.
CHAIR JAMES pointed out that this legislation allows candidates to
spend up to $1,000 to attend political functions; is that
different?
REPRESENTATIVE COGHILL replied no.
CHAIR JAMES asked, is that currently allowed?
UNIDENTIFIED SPEAKER replied yes.
Number 513
REPRESENTATIVE OGAN indicated that the structure of the limits
regarding who can contribute basically eliminates the ability for
corporations and various groups to contribute. The language in the
current legislation would allow the contribution of any amount.
Representative Ogan said that the legislation would seem to narrow
the contributors to a few that control large sums of money that go
into campaigns versus a broad sphere of influence under which many
can give money which is of concern. He also expressed concern with
the elimination of the limits when people potentially stand to make
millions on legislation moving through the process. He said that
$100,000 is a small price to pay to gain influence over
legislation; that is of serious concern and will make corruption
worse. Representative Ogan said that he would rather return to
opening up who can give while placing a limit on that amount which
would allow many to give a little. Such an approach would not seem
to allow any one person more influence than another person.
Representative Ogan believed this legislation would provide a
select group of wealthy individuals more influence than desired.
CHAIR JAMES posed the scenario in which an individual gave a
candidate $100,000. Under the current system, the candidate would
not have to report the receipt of the money, but the individual
would have to report that they gave a gift of $100,000. The report
of that $100,000 contribution would probably end up on the front
page of the newspaper. She inquired as to what Representative Ogan
thought the general public's opinion of that candidate would be.
REPRESENTATIVE OGAN stated that the public seems to be tired of
what goes on in politics; the public does not care.
CHAIR JAMES inquired then as to why this is being done, if people
do not care.
REPRESENTATIVE OGAN commented that people are jaded and tired of
the issue.
CHAIR JAMES asked if Representative Ogan believed people acted
differently under the current law that does not allow an individual
to give more than $500 versus an individual being allowed to
contribute $50,000. She commented that she would set her own
limit, probably a $1,000 to $2,000 contribution from any one
individual.
REPRESENTATIVE OGAN indicated that there are ways to get around
this such as consulting contracts.
CHAIR JAMES asked how a lobbyist would be addressed in this
legislation because she did not believe a lobbyist could be denied
the ability to contribute to a candidate in that lobbyist's own
district. However, she supported not allowing lobbyists to make
contributions to candidates.
REPRESENTATIVE COGHILL interjected that prohibition was kept.
Number 622
CHAIR JAMES commented that the $500 limit is fairly low. She
believed that honorable people would not take large contributions
which is why she supported not having limits.
REPRESENTATIVE COGHILL recognized that there will always be
dishonorable people which is the reasoning behind laws and
regulations. It is also true that the United States is based on
self-government. Representative Coghill said that regulating
government on the assumption that everyone is a criminal is not
appropriate, although there should be provisions for those who act
criminally. Placing responsibility on the general populous with
regard to the no limits giving is important in involving people.
That resulted in the reporting requirement every 15 days.
REPRESENTATIVE COGHILL expressed concern with the Alaska Public
Office Commission having regulation-making power, police and
judicial-making power simultaneously. There needs to be a
separation of powers as well as an easy linkage to move through the
reporting process to the judicial process. Representative Coghill
commented that he would rather put the public in a position of
trust and accountability than the government. In other arenas,
people are not assumed to be criminals first, but rather a law is
established that if violated would result in going to court.
Candidates should have the privilege of an open playing field.
Number 0717
CHAIR JAMES noted that the notion that someone is innocent until
proven guilty has been dispelled in many cases. In other issues,
Chair James expressed concern with civil penalties for a suspected
criminal act such as with child abuse. There have been court
decisions that say that it is permissible to have a civil and a
criminal penalty on a case and that there is authority for civil
penalties. Therefore, Chair James did not know if that issue could
be won.
CHAIR JAMES announced that she would not be appointing a
subcommittee on this bill yet, however that may occur next year.
She offered to meet on these issues during the interim. Chair
James commented that it should be understood that this is a big
change and change does not occur in big pieces, but rather small
pieces.
REPRESENTATIVE OGAN agreed with Chair James comments.
[SSHB 179 WAS HELD OVER.]
ADJOURNMENT
There being no further business before the committee, the House
State Affairs Standing Committee meeting was adjourned at 9:38 a.m.
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