Legislature(2017 - 2018)GRUENBERG 120

02/21/2017 03:00 PM STATE AFFAIRS

Note: the audio and video recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.

Download Mp3. <- Right click and save file as
Download Video part 1. <- Right click and save file as

* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 91 APOC REGISTRATION FEES; LOBBYIST TAX TELECONFERENCED
Heard & Held
+= HB 44 LEGISLATIVE ETHICS: VOTING & CONFLICTS TELECONFERENCED
Heard & Held
+ HCR 1 AMEND UNIFORM RULES: ABSTAIN FROM VOTING TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
             HOUSE STATE AFFAIRS STANDING COMMITTEE                                                                           
                       February 21, 2017                                                                                        
                           3:05 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Jonathan Kreiss-Tomkins, Chair                                                                                   
Representative Gabrielle LeDoux, Vice Chair                                                                                     
Representative Chris Tuck                                                                                                       
Representative Adam Wool                                                                                                        
Representative Chris Birch                                                                                                      
Representative DeLena Johnson                                                                                                   
Representative Gary Knopp                                                                                                       
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Andy Josephson (alternate)                                                                                       
Representative Chuck Kopp (alternate)                                                                                           
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 91                                                                                                               
"An Act  relating to fees  for certain persons  filing disclosure                                                               
statements  or  other  reports with  the  Alaska  Public  Offices                                                               
Commission;  relating  to a  tax  on  legislative lobbyists;  and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 44                                                                                        
"An  Act  requiring  a  legislator  to  abstain  from  taking  or                                                               
withholding official  action or exerting official  influence that                                                               
could  benefit or  harm  an immediate  family  member or  certain                                                               
employers; requiring a  legislator to request to  be excused from                                                               
voting in an  instance where the legislator may  have a financial                                                               
conflict of interest; and providing for an effective date."                                                                     
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE CONCURRENT RESOLUTION NO. 1                                                                                               
Proposing an amendment  to the Uniform Rules of  the Alaska State                                                               
Legislature relating to voting and abstention from voting.                                                                      
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 91                                                                                                                   
SHORT TITLE: APOC REGISTRATION FEES; LOBBYIST TAX                                                                               
SPONSOR(s): REPRESENTATIVE(s) KITO                                                                                              
                                                                                                                                
01/30/17       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/30/17       (H)       STA, FIN                                                                                               
02/09/17       (H)       STA AT 3:00 PM GRUENBERG 120                                                                           
02/09/17       (H)       Heard & Held                                                                                           
02/09/17       (H)       MINUTE(STA)                                                                                            
02/14/17       (H)       STA AT 3:00 PM GRUENBERG 120                                                                           
02/14/17       (H)       Heard & Held                                                                                           
02/14/17       (H)       MINUTE(STA)                                                                                            
02/21/17       (H)       STA AT 3:00 PM GRUENBERG 120                                                                           
                                                                                                                                
BILL: HB 44                                                                                                                   
SHORT TITLE: LEGISLATIVE ETHICS: VOTING & CONFLICTS                                                                             
SPONSOR(s): REPRESENTATIVE(s) GRENN                                                                                             
                                                                                                                                
01/18/17       (H)       PREFILE RELEASED 1/13/17                                                                               
01/18/17       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/18/17       (H)       JUD, FIN                                                                                               
01/23/17       (H)       SPONSOR SUBSTITUTE INTRODUCED-REFERRALS                                                                
01/23/17       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/23/17       (H)       JUD, FIN                                                                                               
01/25/17       (H)       STA REPLACES FIN REFERRAL                                                                              
01/25/17       (H)       BILL REPRINTED 1/25/17                                                                                 
01/25/17       (H)       JUD WAIVED PUBLIC HEARING NOTICE, RULE                                                                 
                         23 FOR SSHB 44                                                                                         
01/25/17       (H)       JUD AT 1:00 PM GRUENBERG 120                                                                           
01/25/17       (H)       -- Meeting Postponed to 1/27/17 --                                                                     
01/27/17       (H)       JUD AT 1:00 PM GRUENBERG 120                                                                           
01/27/17       (H)       -- Meeting Rescheduled from 1/25/17 --                                                                 
01/30/17       (H)       JUD AT 1:30 PM GRUENBERG 120                                                                           
01/30/17       (H)       Heard & Held                                                                                           
01/30/17       (H)       MINUTE(JUD)                                                                                            
02/03/17       (H)       JUD AT 1:30 PM GRUENBERG 120                                                                           
02/03/17       (H)       Moved CSSSHB 44(JUD) Out of Committee                                                                  
02/03/17       (H)       MINUTE(JUD)                                                                                            
02/08/17       (H)       JUD RPT CS(JUD) 1DP 3DNP 3AM                                                                           
02/08/17       (H)       DP: LEDOUX                                                                                             
02/08/17       (H)       DNP: KOPP, EASTMAN, REINBOLD                                                                           
02/08/17       (H)       AM: KREISS-TOMKINS, FANSLER, CLAMAN                                                                    
02/18/17       (H)       STA AT 11:00 AM GRUENBERG 120                                                                          
02/18/17       (H)       Heard & Held                                                                                           
02/18/17       (H)       MINUTE(STA)                                                                                            
02/21/17       (H)       STA AT 3:00 PM GRUENBERG 120                                                                           
                                                                                                                                
BILL: HCR 1                                                                                                                   
SHORT TITLE: AMEND UNIFORM RULES: ABSTAIN FROM VOTING                                                                           
SPONSOR(s): REPRESENTATIVE(s) GRENN                                                                                             
                                                                                                                                
01/20/17       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/20/17       (H)       STA, JUD                                                                                               
01/20/17       (H)       JUD REFERRAL REMOVED                                                                                   
01/20/17       (H)       JUD REFERRAL ADDED BEFORE STA                                                                          
01/25/17       (H)       JUD AT 1:00 PM GRUENBERG 120                                                                           
01/25/17       (H)       -- Meeting Postponed to 1/27/17 --                                                                     
01/27/17       (H)       JUD AT 1:00 PM GRUENBERG 120                                                                           
01/27/17       (H)       -- Meeting Rescheduled from 1/25/17 --                                                                 
01/30/17       (H)       JUD AT 1:30 PM GRUENBERG 120                                                                           
01/30/17       (H)       Heard & Held                                                                                           
01/30/17       (H)       MINUTE(JUD)                                                                                            
02/03/17       (H)       JUD AT 1:30 PM GRUENBERG 120                                                                           
02/03/17       (H)       Moved HCR 1 Out of Committee                                                                           
02/03/17       (H)       MINUTE(JUD)                                                                                            
02/08/17       (H)       JUD AT 1:30 PM GRUENBERG 120                                                                           
02/08/17       (H)       Moved HCR 1 Out of Committee                                                                           
02/08/17       (H)       MINUTE(JUD)                                                                                            
02/10/17       (H)       JUD RPT 1DP 3DNP 2AM                                                                                   
02/10/17       (H)       DP: CLAMAN                                                                                             
02/10/17       (H)       DNP: EASTMAN, KOPP, REINBOLD                                                                           
02/10/17       (H)       AM: KREISS-TOMKINS, FANSLER                                                                            
02/21/17       (H)       STA AT 3:00 PM GRUENBERG 120                                                                           
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
REPRESENTATIVE SAM KITO                                                                                                         
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Answered questions on HB 91, as prime                                                                    
sponsor.                                                                                                                        
                                                                                                                                
CRYSTAL KOENEMAN, Staff                                                                                                         
Representative Sam Kito                                                                                                         
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Answered questions on HB 91 on behalf of                                                                 
Representative Kito, prime sponsor.                                                                                             
                                                                                                                                
HEATHER HEBDON, Executive Director                                                                                              
Alaska Public Offices Commission (APOC)                                                                                         
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Answered questions  during the hearing on HB                                                             
91.                                                                                                                             
                                                                                                                                
RYAN JOHNSTON, Staff                                                                                                            
Representative Jason Grenn                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   Provided a sectional analysis of  HCR 1 and                                                             
explained CSSSHB 44(JUD)  and HCR 1 with the use  of a PowerPoint                                                               
presentation, on  behalf of  Representative Grenn,  prime sponsor                                                               
of CSSSHB 44(JUD) and HCR 1.                                                                                                    
                                                                                                                                
REPRESENTATIVE JASON GRENN                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:   Answered questions  during the  hearing on                                                             
CSSSHB 44(JUD) and HCR 1, as prime sponsor.                                                                                     
                                                                                                                                
JERRY ANDERSON, Administrator                                                                                                   
Select Committee on Legislative Ethics                                                                                          
Legislative Agencies and Offices                                                                                                
Anchorage, Alaska                                                                                                               
POSITION  STATEMENT:   Answered questions  during the  hearing on                                                             
HCR 1 and CSSSHB 44(JUD).                                                                                                       
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
3:05:52 PM                                                                                                                    
                                                                                                                                
CHAIR  JONATHAN KREISS-TOMKINS  called  the  House State  Affairs                                                             
Standing   Committee    meeting   to    order   at    3:05   p.m.                                                               
Representatives LeDoux,  Tuck, Wool,  Birch, Johnson,  Knopp, and                                                               
Kreiss-Tomkins were present at the call to order.                                                                               
                                                                                                                                
           HB 91-APOC REGISTRATION FEES; LOBBYIST TAX                                                                       
                                                                                                                                
3:07:00 PM                                                                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS  announced that the first  order of business                                                               
would be HOUSE BILL NO. 91,  "An Act relating to fees for certain                                                               
persons filing  disclosure statements  or other reports  with the                                                               
Alaska  Public   Offices  Commission;   relating  to  a   tax  on                                                               
legislative lobbyists; and providing for an effective date."                                                                    
                                                                                                                                
3:08:01 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SAM  KITO,  Alaska State  Legislature,  as  prime                                                               
sponsor  of  HB 91,  stated  that  staff is  exploring  alternate                                                               
methods  for collecting  program receipts  for the  Alaska Public                                                               
Offices  Commission  (APOC).   He  suggested  that replacing  the                                                               
"income tax"  in HB 91 with  a "fee" would provide  a more direct                                                               
path  to generating  program receipts.   He  emphasized that  the                                                               
goal is to generate money for  APOC to support its operations, to                                                               
satisfy  the program  receipt authority,  and to  provide savings                                                               
for the State of Alaska.                                                                                                        
                                                                                                                                
3:09:33 PM                                                                                                                    
                                                                                                                                
CRYSTAL KOENEMAN,  Staff, Representative  Sam Kito,  Alaska State                                                               
Legislature, on  behalf of Representative Kito,  prime sponsor of                                                               
HG 91, relayed that staff  is considering a "stair-step" approach                                                               
for generating revenue for APOC:   the lower the contract amount,                                                               
the  fewer the  filings  with  APOC and  the  less  work; as  the                                                               
contract  amount increases,  more  work is  associated with  APOC                                                               
filings.   She stated  that the  new proposal  under HB  91 would                                                               
consist of:   a $350 fee for contracts under  $30,000; a $650 fee                                                               
for contracts between $30,000 and  [$60,000]; and an $850 fee for                                                               
contracts [$60,000]  and over.   She asserted that  the resulting                                                               
revenue under  this proposal is  estimated to be  $259,150, based                                                               
on 2015 and 2016 data provided by  APOC.  She went on to say that                                                               
after  adding  in the  estimated  $106,600  in revenue  generated                                                               
through  the proposed  registration fees  for candidate,  groups,                                                               
and  non-group entities  and  the  proposed financial  disclosure                                                               
fees for  legislators and public  officials, the  total estimated                                                               
revenue is  $365,750.   She maintained that  this amount  is much                                                               
closer  to the  estimated  amount [of  $329,750]  in the  sponsor                                                               
statement.  She  asserted that collection of these  fees into the                                                               
designated  general fund  (DGF) would  reduce the  2018 operating                                                               
budget request by approximately $120,000.                                                                                       
                                                                                                                                
3:11:54 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  LEDOUX  asked why  a  smaller  contract would  be                                                               
necessarily  less complicated  than a  larger contract,  and what                                                               
would be required  of APOC pertaining to a contract  of less than                                                               
$30,000 compared with a contract of greater than $60,000.                                                                       
                                                                                                                                
REPRESENTATIVE  KITO responded  that one  difference is  the work                                                               
that  the lobbyist  is providing  the client.   He  conceded that                                                               
sometimes contracts  overstate or understate the  amount of work.                                                               
He  explained,  however,  that  under  a  $10,000  contract,  the                                                               
likelihood of extensive billings  for lobbyist activities needing                                                               
reconciliation by APOC, such as  taking clients out to dinner, is                                                               
less than for a $60,000 contract.                                                                                               
                                                                                                                                
REPRESENTATIVE LEDOUX stated  that what she has  observed is that                                                               
the client,  not the lobbyist,  is paying  for the dinners.   She                                                               
added that some lobbyists entertain  clients in their homes.  She                                                               
pointed out that  in neither of these cases do  the expenses show                                                               
up in APOC reports.   Representative LeDoux asked what APOC would                                                               
be looking for with a higher priced client.                                                                                     
                                                                                                                                
3:16:23 PM                                                                                                                    
                                                                                                                                
HEATHER  HEBDON,   Executive  Director,  Alaska   Public  Offices                                                               
Commission (APOC),  responded that her understanding  is that the                                                               
stair-step approach  for fees, which  is being considered  for HB                                                               
91, is  based on the volume  of reports that come  into APOC, and                                                               
that volume  relates to  the amount  of a  contract.   She stated                                                               
that  the  assumption  is  that  larger  contracts  require  more                                                               
reporting.  She explained that  fees are not based necessarily on                                                               
a single registration  fee for a single lobbyist,  since a single                                                               
lobbyist may  have a dozen  different clients.  She  offered that                                                               
the  lobbyists making  more money  would have  more clients  and,                                                               
therefore, would require more reporting.                                                                                        
                                                                                                                                
REPRESENTATIVE LEDOUX asked if a  lobbyist with one client paying                                                               
$61,000 is likely  to have less reports than a  lobbyist with one                                                               
client paying $10,000.                                                                                                          
                                                                                                                                
MS. HEBDON replied  no, that is not her understanding.   She said                                                               
that the  amounts referenced  by the  three contract  ranges, are                                                               
not based  on the individual  lobbyist, but rather on  the amount                                                               
that  the  lobbyist is  making  from  lobbying activities.    She                                                               
conceded  that a  single lobbyist  could have  one client  paying                                                               
$60,000, but  the expectation is  that the single  lobbyist makes                                                               
$60,000  with ten  clients, and  there are  separate reports  for                                                               
each of the ten clients.                                                                                                        
                                                                                                                                
REPRESENTATIVE  LEDOUX   suggested  that   Representative  Kito's                                                               
intention  is  that  under  HB  91 every  lobbyist  would  pay  a                                                               
registration  fee,  and if  the  contract  amount for  any  given                                                               
client is more than $60,000,  the registration fee would be $850.                                                               
She  added  that  if  the  contract were  $10,000  or  less,  the                                                               
registration fee  would be $350.   She expressed her  belief that                                                               
the  fee was  not intended  to be  based on  "the entire  book of                                                               
clients" for a lobbyist.                                                                                                        
                                                                                                                                
3:20:22 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KITO responded  that the  fees for  lobbyists are                                                               
currently assessed  at $250 per client.   He explained that  if a                                                               
lobbyist has multiple clients, then  he/she pays that fee on each                                                               
client.   He  added  that  if a  client  contracts with  multiple                                                               
lobbyists, each  lobbyist is  paying a  fee on  that client.   He                                                               
stated that the  goal for restructuring APOC fees  is to generate                                                               
enough revenue for APOC to be able to fulfill its duties.                                                                       
                                                                                                                                
REPRESENTATIVE LEDOUX  conceded that a client  paying $60,000 for                                                               
lobbying  services can  more afford  the $850  fee than  a client                                                               
paying $10,000  for lobbying  services.  She  stated that  she is                                                               
not sure that  the $60,000 client necessarily  engenders more for                                                               
any lobbyist than does the $10,000 client.                                                                                      
                                                                                                                                
CHAIR KREISS-TOMKINS  suggested that  assigning fees in  this way                                                               
is comparable  to the  Alaska Court  System assessing  court fees                                                               
based on  the size of a  tort claim, even though  a smaller claim                                                               
may  require more  in court  services than  a larger  claim.   He                                                               
offered that the size  of a claim or contract is  used as a blunt                                                               
metric for assessing a fee.                                                                                                     
                                                                                                                                
3:22:37 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  BIRCH referred  to the  sponsor statement,  which                                                               
estimates   revenue  of   $60,000  through   the  $50   financial                                                               
disclosure filing fees.  He  asked if besides the 60 legislators,                                                               
there  were  1,100  other   people  submitting  annual  financial                                                               
disclosure forms.                                                                                                               
                                                                                                                                
MS. HEBDON said  that AS 24.60.200 requires  a significant number                                                               
of  people   to  file  financial  disclosure   statements.    She                                                               
mentioned  that   the  five-year   average  of   public  official                                                               
financial disclosures (POFDs) received  by APOC was approximately                                                               
1,300  per year.   She  said that  number includes  those in  the                                                               
executive  branch and  governor's office,  members of  boards and                                                               
commissions, and  legislators.   She added that  municipal filers                                                               
in  communities with  populations  greater than  15,000, who  are                                                               
subject  to APOC's  electronic reporting  requirements, are  also                                                               
included  in the  five-year annual  average.   She expressed  her                                                               
desire for more  clarification in Section 4, on page  3 of HB 91,                                                               
to better  define the  group of  filers from  whom APOC  would be                                                               
collecting fees.                                                                                                                
                                                                                                                                
REPRESENTATIVE BIRCH asked  how much effort is  required for APOC                                                               
to manage the financial disclosure filings.                                                                                     
                                                                                                                                
MS.  HEBDON replied  that the  majority of  APOC's budget  is for                                                               
personnel.   She said the  online filing system alone  requires a                                                               
fulltime analyst programmer.  She  mentioned that direct services                                                               
to the public  consume most of APOC personnel's  time - answering                                                               
phone calls,  answering emails, assisting filers  with the online                                                               
filing system,  and auditing reports.   She added  that currently                                                               
APOC is  statutorily required to  audit every report  coming into                                                               
the office, but it doesn't have the staff to do so.                                                                             
                                                                                                                                
3:26:09 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE WOOL  asked for confirmation  that instead  of the                                                               
income tax  specified in  the original  bill or  the flat  fee of                                                               
$250 currently in statute, the new  version of HB 91 will include                                                               
a fee  on a sliding  scale that is  progressive - the  higher the                                                               
value of the contract, the higher the fee.                                                                                      
                                                                                                                                
MS. KOENEMAN confirmed  that the fee would be on  a sliding scale                                                               
based on [lobbyist] income [from] the client.                                                                                   
                                                                                                                                
REPRESENTATIVE WOOL offered  that the [new proposed]  fee was per                                                               
contract, whereas  the previous 2.5  percent tax would  have been                                                               
on the lobbyist's gross amount derived from all the contracts.                                                                  
                                                                                                                                
REPRESENTATIVE  KITO responded  that the  mechanism for  applying                                                               
the tax  versus the fee  would be the same.   He stated  that the                                                               
2.5  percent tax  for each  lobbyist would  have applied  to each                                                               
lobbyist  contract.   He went  on  to say  that this  would be  a                                                               
change from  a tax to a  fee.  He said  that the fee is  set at a                                                               
sliding scale, not  a percentage; for all of  those below $30,000                                                               
is  one fee,  between $30,000  and  $60,000 is  another fee,  and                                                               
above $60,000 is another fee.                                                                                                   
                                                                                                                                
3:27:44 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KNOPP noted  APOC's  reduction  in revenue,  from                                                               
$1,300,000  in  2015  to  $866,000  in  2016,  and  reduction  in                                                               
fulltime staff, from 12 positions  authorized in fiscal year 2017                                                               
(FY 17) to  8 positions shown in the  current organization chart.                                                               
He  asked if  APOC is  currently operating  with eight  full-time                                                               
employees.                                                                                                                      
                                                                                                                                
MS.  HEBDON  responded that  APOC  currently  has eight  position                                                               
control numbers  (PCNs), and the analyst  programmer position and                                                               
one other position are currently vacant.                                                                                        
                                                                                                                                
REPRESENTATIVE  KNOPP  asked if  those  two  positions have  been                                                               
vacant for some time.                                                                                                           
                                                                                                                                
MS. HEBDON replied yes.  She  said that when the former executive                                                               
director left, she became the  executive director and has not yet                                                               
recruited for her former position.                                                                                              
                                                                                                                                
REPRESENTATIVE  KITO  confirmed  in  response  to  Representative                                                               
Knopp  that the  legislature authorized  receipt authority  up to                                                               
$240,000, but  by statute  the only fee  that could  be collected                                                               
was $250 per client per lobbyist, which raised about $106,000.                                                                  
                                                                                                                                
3:30:20 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KNOPP referred  to the  document, titled  "Multi-                                                               
year Allocation Totals with Funding  - Operating Budget - FY 2017                                                               
Conf Committee Structure," included  in the committee packet, and                                                               
asked if the amounts shown  in the budget were amounts authorized                                                               
but not necessarily received by APOC for operations.                                                                            
                                                                                                                                
MS. KOENEMAN  referred to the  column, titled "FY 16  Actual," to                                                               
point  out  that the  legislature  had  appropriated $758,500  in                                                               
unrestricted  general funds  (UGF),  but APOC  was  only able  to                                                               
utilize  $107,500, because  that  was the  limit  of its  receipt                                                               
authority.   She then  referred to the  amounts listed  under the                                                               
column, titled "FY  16 Final," and pointed out  that $240,000 was                                                               
appropriated  by  the  legislature,  but  it  turned  out  to  be                                                               
"hollow"  authority  because  APOC  did not  have  the  statutory                                                               
authority to collect fees up to  that amount.  She added that the                                                               
legislature  thought   it  was  giving  APOC   additional  funds;                                                               
however,  the revenue  generated by  APOC fees  was substantially                                                               
lower than the amount authorized.                                                                                               
                                                                                                                                
REPRESENTATIVE  KNOPP asked  if the  legislature was  giving APOC                                                               
authority to spend an amount that it was not able to collect.                                                                   
                                                                                                                                
MS. KOENEMAN replied, "Basically, yes."                                                                                         
                                                                                                                                
REPRESENTATIVE KNOPP  referred to  the $242,600 listed  under the                                                               
column, titled "FY  17 Auth," and asked if APOC  would be able to                                                               
collect this amount only if HB 91 passed.                                                                                       
                                                                                                                                
MS. KOENEMAN  confirmed that APOC  would not be able  to generate                                                               
$242,600  in   funds,  but   only  the   approximately  $107,000,                                                               
depending  on the  number of  filers.   She  reiterated that  the                                                               
intent of HB 91 is to  raise the statutory fee authority allowing                                                               
APOC to collect more revenue.                                                                                                   
                                                                                                                                
3:33:15 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KNOPP  commented  that with  the  possibility  of                                                               
filing  fees, he  believes that  people appointed  to boards  and                                                               
commissions should be  exempt from APOC filing.   He relayed that                                                               
there are  about 360 people  who fall into these  categories, and                                                               
they  are not  necessarily  compensated.   He  asserted that  the                                                               
exemption would alleviate APOC of some of its workload.                                                                         
                                                                                                                                
CHAIR   KREISS-TOMKINS    offered   that   the    Department   of                                                               
Administration Finance Subcommittee  was considering reducing the                                                               
number of public officials who are required to file POFDs.                                                                      
                                                                                                                                
[HB 91 was held over.]                                                                                                          
                                                                                                                                
3:35:06 PM                                                                                                                    
                                                                                                                                
The committee took an at-ease from 3:35 p.m. to 3:38 p.m.                                                                       
                                                                                                                                
          HB 44-LEGISLATIVE ETHICS: VOTING & CONFLICTS                                                                      
         HCR 1-AMEND UNIFORM RULES: ABSTAIN FROM VOTING                                                                     
                                                                                                                                
3:37:31 PM                                                                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS  announced that the final  order of business                                                               
would  be SPONSOR  SUBSTITUTE  FOR  HOUSE BILL  NO.  44, "An  Act                                                               
requiring  a legislator  to abstain  from  taking or  withholding                                                               
official  action  or  exerting   official  influence  that  could                                                               
benefit or harm an immediate  family member or certain employers;                                                               
requiring a  legislator to request  to be excused from  voting in                                                               
an instance  where the legislator  may have a  financial conflict                                                               
of  interest; and  providing for  an effective  date." and  HOUSE                                                               
CONCURRENT  RESOLUTION  NO.  1,  Proposing an  amendment  to  the                                                               
Uniform Rules of the Alaska  State Legislature relating to voting                                                               
and abstention  from voting.   [Before  the committee  was CSSSHB                                                               
44(JUD) and HCR 1.]                                                                                                             
                                                                                                                                
3:38:14 PM                                                                                                                    
                                                                                                                                
RYAN JOHNSTON,  Staff, Representative  Jason Grenn,  Alaska State                                                               
Legislature, on behalf of Representative  Grenn, prime sponsor of                                                               
CSSSHB 44(JUD) and HCR 1, provided  a sectional analysis of HCR 1                                                               
and  explained  CSSSHB 44(JUD)  and  HCR  1  with  the use  of  a                                                               
PowerPoint  presentation.   He relayed  that Section  1 of  HCR 1                                                               
would amend  Uniform Rule  34(b) to state  that a  legislator may                                                               
abstain from a  vote with a majority consent.   He explained that                                                               
currently  Uniform  Rule  34(b)  states  that  a  legislator  may                                                               
abstain from a  vote by unanimous consent.  He  stated that HCR 1                                                               
would amend  Uniform Rule 34(b)  to include two instances  when a                                                               
member of  the legislature may  not vote:   a legislator  may not                                                               
vote on his/her own abstention, and  a legislator may not vote on                                                               
an issue  if the body  of the  legislature casts a  majority vote                                                               
ruling that the legislator must abstain.                                                                                        
                                                                                                                                
3:39:30 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  WOOL asked  for  clarification of  the phrase  "a                                                               
legislator may not vote on his/her own abstention."                                                                             
                                                                                                                                
MR. JOHNSTON replied  that the phrase was  included because staff                                                               
thought  it improper  for a  legislator  to vote  on his/her  own                                                               
abstention, after making a motion to abstain.                                                                                   
                                                                                                                                
3:42:00 PM                                                                                                                    
                                                                                                                                
MR. JOHNSTON referred  to slide 2 of  the PowerPoint presentation                                                               
on  CSSSHB  44(JUD)  and  HCR 1,  titled  "Current  Uniform  Rule                                                               
34(b),"  which  highlights  that  a  legislator  currently  needs                                                               
unanimous consent to  abstain from voting.  He  referred to slide                                                               
3, titled "HCR  1 Proposed Changes to Uniform  Rule 34(b)," which                                                               
states that  the change in  the rule would  be the change  from a                                                               
unanimous consent to  a majority consent by  the legislative body                                                               
to allow a legislator to abstain from a vote.                                                                                   
                                                                                                                                
MR. JOHNSTON referred to slide  4, titled "Source of Language for                                                               
Majority Vote:" and  relayed that the source of  the language for                                                               
a majority  vote comes from  AS 29.20.010(a), in which  the state                                                               
dictated  that municipalities  must have  a conflict  of interest                                                               
ordinance.   He cited AS  29.20.010(a)(3), which states  that the                                                               
ruling of the  presiding officer can be overridden  by a majority                                                               
vote of  the legislative body.   He  added that since  a majority                                                               
vote is  used on the  municipal level to overturn  an abstention,                                                               
staff  considered  it a  preexisting  benchmark  for allowing  an                                                               
abstention in the legislature.  He  concluded that HCR 1 seeks to                                                               
bring  about consistency  between what  the state  requires of  a                                                               
municipality and what is required of the legislature.                                                                           
                                                                                                                                
MR. JOHNSTON  referred to slide 5,  titled "Legislative Breakdown                                                               
for  Voting Recusal,"  to discuss  the voting  recusal rules  for                                                               
legislative bodies  across the  country.   He explained  that the                                                               
breakdown  is done  by  individual state  houses,  not the  state                                                               
itself.  He added that every  state has a House and Senate except                                                               
for Nebraska,  which has  a unicameral  legislature.   He relayed                                                               
that  in some  states, the  two legislative  bodies share  rules,                                                               
while in other states, one rule  is used for one body and another                                                               
rule used for  the other body.   He related that 30  bodies use a                                                               
method of  voting that  allows a  legislator to  abstain:   24 of                                                               
those use  a majority  consent; 4 use  a two-thirds  consent; and                                                               
Alaska is the lone state  requiring unanimous consent.  He stated                                                               
that  58 bodies  use a  method  whereby a  legislator declares  a                                                               
conflict and is required to abstain  without a vote; 5 bodies use                                                               
the  method  of  declaring  a  conflict  and  the  legislator  is                                                               
required to vote  or may choose to abstain; and  6 bodies use the                                                               
method  of  allowing  for  a presiding  officer  to  use  his/her                                                               
discretion.   He added  that in this  last method,  the presiding                                                               
officer determines  if the  conflict is substantial  or not.   If                                                               
the conflict  is substantial, then  the presiding  officer grants                                                               
the  legislator  the   abstention.    If  the   conflict  is  not                                                               
substantial,  then the  legislator is  required by  the presiding                                                               
officer to vote.                                                                                                                
                                                                                                                                
3:43:33 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHNSON referred  to slide  4 and  asked when  AS                                                               
29.20.010 was enacted.                                                                                                          
                                                                                                                                
MR.  JOHNSTON responded  that the  original  statute was  enacted                                                               
June 30, 1986.                                                                                                                  
                                                                                                                                
REPRESENTATIVE  JOHNSON  asked  when  the  conflict  of  interest                                                               
statutes for the legislature were enacted.                                                                                      
                                                                                                                                
MR. JOHNSTON  answered that  he did  not have  an exact  date but                                                               
would provide her with that information.                                                                                        
                                                                                                                                
3:45:24 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  LEDOUX asked  for  confirmation  that state  laws                                                               
require  municipalities  to  abide  by  a  conflict  of  interest                                                               
statute, whereas the legislature does not require it of itself.                                                                 
                                                                                                                                
3:46:07 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JASON  GRENN, Alaska  State Legislature,  as prime                                                               
sponsor  of  CSSSHB  44(JUD)  and  HCR  1,  responded,  "That  is                                                               
correct."                                                                                                                       
                                                                                                                                
REPRESENTATIVE JOHNSON  commented that there is  an open meetings                                                               
act on the municipal level,  which the legislature does not have,                                                               
and maybe the legislature will want to "take that one on next."                                                                 
                                                                                                                                
3:46:49 PM                                                                                                                    
                                                                                                                                
MR. JOHNSTON  continued with his  presentation to  discuss CSSSHB                                                               
44(JUD).  He  referred to slide 7, titled  "Employer Conflicts of                                                               
Interest  in  Current Statutes,"  and  said  that CSSSHB  44(JUD)                                                               
focuses on  changes to subsections  (e) and (g) in  AS 24.60.030.                                                               
He stated that currently AS  24.60.030(e) addresses the potential                                                               
conflict of interest  for a legislator who  takes official action                                                               
that could substantially  benefit or harm a person  with whom the                                                               
legislator is negotiating for employment.                                                                                       
                                                                                                                                
MR. JOHNSTON referred to slide  8, titled "HB 44 Proposed Changes                                                               
to AS  24.60.030(e)," and said  that CSSSHB 44(JUD)  would retain                                                               
the language  "negotiating for employment" but  broaden the scope                                                               
of AS  24.60.030(e)(3) to  include a  member of  the legislator's                                                               
immediate  family,  the  employer  of  a  legislator  or  his/her                                                               
immediate  family   member,  and  a  previous   employer  that  a                                                               
legislator worked for in the preceding 12-month period.                                                                         
                                                                                                                                
MR.  JOHNSTON referred  to  slide 9,  titled  "Other States  with                                                               
Employer  Conflict   Language,"  and   relayed  that   there  are                                                               
currently  29 states  that have  statutes  dealing directly  with                                                               
possible  conflicts   of  interest   that  could  arise   from  a                                                               
legislator being employed outside of the legislature.                                                                           
                                                                                                                                
3:48:01 PM                                                                                                                    
                                                                                                                                
MR.  JOHNSTON  referred to  slide  10,  titled "Current  Monetary                                                               
Threshold in Statute  Regarding Members of the  Public," and said                                                               
that the  $10,000 threshold  is found  in AS  24.60.990(b), which                                                               
sets the  standard for  a substantial  interest in  a legislative                                                               
action by  a member of the  public who seeks contracts  more than                                                               
$10,000 annually  for goods or  services with the  legislature or                                                               
agency  of the  state.   He  maintained  that incorporating  this                                                               
threshold into the statute would  bring the legislature up to the                                                               
same standard  to which the state  holds a person of  the public,                                                               
when   determining   a   substantial  interest,   thus   creating                                                               
consistency between what is required  of the legislature and what                                                               
is  required of  the  public.   He mentioned  that  the State  of                                                               
Virginia also uses the $10,000  threshold for income, which is in                                                               
VS 30-101.                                                                                                                      
                                                                                                                                
MR.  JOHNSTON then  referred to  slide  11, titled  "'Substantial                                                               
Class'  in  Current  Statutes,"  to  point  out  the  mention  of                                                               
"substantial  class"  found in  AS  24.60.030(g),  and slide  12,                                                               
titled  "'Substantial Class'  in  Current  Statutes (cont.),"  to                                                               
cite the  mention of  "substantial class"  found in  AS 24.60.990                                                               
(b).   He  maintained that  the "substantial  class" language  in                                                               
these  two subsections  of statute  are consistent  with previous                                                               
and  other states'  statutes.   He referred  to slide  13, titled                                                               
"Substantial  Class  in Other  State's  Statute,"  to recite  the                                                               
breakdown  by  states:   19  states  have the  substantial  class                                                               
language; 8 states use similar language  but refer to it in terms                                                               
of  the effect  on the  interests of  the general  public of  the                                                               
state,  instead of  on the  substantial class;  and 2  states use                                                               
both forms  of statutory language  in their conflict  of interest                                                               
determinations.                                                                                                                 
                                                                                                                                
3:50:14 PM                                                                                                                    
                                                                                                                                
MR. JOHNSTON  confirmed in response  to Representative  Tuck that                                                               
current statutory language is shown in  blue on the slides and is                                                               
the language  that is being  compared with other  state statutory                                                               
language.                                                                                                                       
                                                                                                                                
REPRESENTATIVE  WOOL  referred  to  slide 11  and  asked  if  the                                                               
language in AS  24.60.030(g) could apply to a  chicken farm owner                                                               
voting on laws about importing chickens.                                                                                        
                                                                                                                                
MR.   JOHNSTON  answered   that  if   proposed  legislation   was                                                               
introduced that  gave a tax  incentive only for  500-acre chicken                                                               
farms,  and the  legislator had  a 500-acre  chicken farm,  there                                                               
would be  a conflict of interest.   He added that  if legislation                                                               
was introduced that  gave tax incentives to  every chicken farmer                                                               
in Alaska,  then there would  be no substantial benefit  or harm,                                                               
because the industry is being affected as a whole.                                                                              
                                                                                                                                
REPRESENTATIVE  WOOL  mentioned  the  difficulty  in  delineating                                                               
between  a class  and subclass  of an  industry and  offered that                                                               
such  technical  issues may  not  be  easily discernable  at  the                                                               
moment of a House floor vote.   He added that taking the question                                                               
to  the Select  Committee  on Legislative  Ethics  may delay  the                                                               
decision months.   He offered  that if he  was an employee  of an                                                               
industry, then  he would  not be  affected because  he is  not an                                                               
owner.  He asked  if an employee of an oil  company voting on oil                                                               
taxes would  be considered differently  from the owner of  an oil                                                               
company voting on oil taxes.                                                                                                    
                                                                                                                                
MR. JOHNSTON responded that under  current statute, that would be                                                               
the correct interpretation.                                                                                                     
                                                                                                                                
REPRESENTATIVE WOOL  asked if an  owner of an oil  company voting                                                               
on  oil taxes  affecting all  oil companies  would be  allowed to                                                               
vote.                                                                                                                           
                                                                                                                                
MR. JOHNSON responded that is correct.                                                                                          
                                                                                                                                
CHAIR  KREISS-TOMKINS commented  that many  disclosures occurring                                                               
on the House  floor currently are not required by  the "letter of                                                               
the law," and the law defines conflicts much more narrowly.                                                                     
                                                                                                                                
3:54:39 PM                                                                                                                    
                                                                                                                                
JERRY  ANDERSON, Administrator,  Select Committee  on Legislative                                                               
Ethics,   Legislative   Agencies   and   Offices,   stated   that                                                               
Representative Wool's question  has been the subject  of a number                                                               
of advisory  opinions, and it  is a complex question  that cannot                                                               
be answered without a specific set of facts.                                                                                    
                                                                                                                                
3:55:28 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK  requested  Mr.   Anderson  to  provide  the                                                               
committee  with  the  last  three  cases in  which  there  was  a                                                               
conflict of interest  on the floor.  He maintained  that "this is                                                               
really  a  gray area,"  and  it  is  always  safer to  declare  a                                                               
conflict than not to declare one.   He offered that reviewing the                                                               
facts  of  cases  with  the  names blanked  out  would  help  the                                                               
committee understand what constitutes conflicts of interest.                                                                    
                                                                                                                                
MR.  ANDERSON confirmed  that he  could provide  examples to  the                                                               
committee.   He  clarified  that his  agency  has both  complaint                                                               
decisions and advisory opinions and could provide both.                                                                         
                                                                                                                                
REPRESENTATIVE  TUCK  expressed that  he  is  more interested  in                                                               
reviewing the  complaints, but the  advisory opinions  would also                                                               
be good to review.                                                                                                              
                                                                                                                                
REPRESENTATIVE KNOPP offered a scenario:   passage of the omnibus                                                               
reform bill  would result in  a benefit to  collective bargaining                                                               
units.   He  asked  if  a legislator  would  have  a conflict  of                                                               
interest  voting  on  that  particular  proposed  legislation  if                                                               
he/she were a member of a collective bargaining unit.                                                                           
                                                                                                                                
MR. ANDERSON  replied that Representative  Knopp is  describing a                                                               
very large  class of people  and, under the current  statute, one                                                               
individual of that class would  not benefit substantially greater                                                               
than the class as a whole.                                                                                                      
                                                                                                                                
REPRESENTATIVE WOOL  offered a hypothetical situation:   There is                                                               
a vote  on the  floor, and  a legislator  declares a  conflict of                                                               
interest.   Then there  is a  vote on  the conflict  of interest,                                                               
which is disputed by the  legislator with the potential conflict.                                                               
The case goes to the Select  Committee on Legislative Ethics.  He                                                               
asked if the question would be  resolved in a timely manner or if                                                               
it  would  involve a  long  investigation.    He asked  what  the                                                               
procedure would be at that point.                                                                                               
                                                                                                                                
MR. ANDERSON said  he is only able to provide  information on the                                                               
current  statutes but  could  offer an  opinion  on the  proposed                                                               
legislation.   He said under the  current rules if a  conflict of                                                               
interest is  declared and there  is an objection,  the legislator                                                               
making the declaration is required to vote.                                                                                     
                                                                                                                                
3:59:30 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE LEDOUX  speculated that even if  the Uniform Rules                                                               
were amended requiring  a legislator to vote,  there are probably                                                               
very few cases in which that  legislator would have to vote under                                                               
the  current  version  of  the  statute.   She  opined  that  the                                                               
conflict of  interest statute  "has a hole  big enough  you could                                                               
drive a tank through."                                                                                                          
                                                                                                                                
CHAIR   KREISS-TOMKINS  asked   Mr.   Anderson   to  describe   a                                                               
hypothetical  situation  that  would  constitute  a  conflict  of                                                               
interest under current law.                                                                                                     
                                                                                                                                
MR. ANDERSON  answered that a  case in  which a legislator  had a                                                               
financial  stake in  the outcome  of the  vote could  potentially                                                               
constitute  a conflict  of  interest.   He  gave  as an  example:                                                               
regarding the  collective bargaining vote mentioned  earlier, the                                                               
legislator's compensation  was tied to  the outcome of  that vote                                                               
and  involved bonuses  or  other incentives  that  had a  greater                                                               
impact  on the  legislator  than the  large  class of  collective                                                               
bargaining people.                                                                                                              
                                                                                                                                
REPRESENTATIVE LEDOUX  responded that she did  not understand Mr.                                                               
Anderson's  example  because  collective  bargaining  involves  a                                                               
large class of  people.  She said that under  statute, a conflict                                                               
would  have to  involve a  legislator  who was  different from  a                                                               
large class of people.                                                                                                          
                                                                                                                                
MR. ANDERSON  responded that  in the  scenario he  described, the                                                               
financial impact  was greater  for the  legislator voting  on the                                                               
proposed  legislation  than for  the  collective  class to  which                                                               
he/she belonged - the collective bargaining unit.                                                                               
                                                                                                                                
REPRESENTATIVE LEDOUX asked if that  could happen, since the vote                                                               
would affect everyone in the collective bargaining unit.                                                                        
                                                                                                                                
4:02:35 PM                                                                                                                    
                                                                                                                                
CHAIR KREISS-TOMKINS asked for  clarification that the legislator                                                               
in  the  hypothetical  scenario  has   a  unique  status  in  the                                                               
collective  bargaining  unit,  such as  a  negotiator,  therefore                                                               
would be subject to a bonus or incentive.                                                                                       
                                                                                                                                
MR.  ANDERSON said  yes.    The legislator  may  be  part of  the                                                               
collective bargaining  unit, but because  of his/her status  as a                                                               
negotiator,  he/she  would  have   a  greater  financial  benefit                                                               
because of the legislation.                                                                                                     
                                                                                                                                
REPRESENTATIVE LEDOUX  asked if  a negotiator  might get  a bonus                                                               
for negotiating  a good contract.   She opined that  the scenario                                                               
seems relatively far-fetched.                                                                                                   
                                                                                                                                
MR.   ANDERSON  replied,   "That  is   the  situation   that  I'm                                                               
describing."   He conceded that  the scenario may  be far-fetched                                                               
but expressed that the legislator  being different from the large                                                               
class of  people is  what would  be required  for the  benefit to                                                               
him/her to  be greater  than the  benefit to  the large  class of                                                               
people.                                                                                                                         
                                                                                                                                
CHAIR  KREISS-TOMKINS  referred  to  the  hypothetical  situation                                                               
involving a  legislator who is  a chicken farmer with  500 acres.                                                               
He  asked  for  confirmation   that  proposed  legislation  about                                                               
chicken farms  would not  constitute a  conflict of  interest for                                                               
the legislator, but chicken farm  legislation relating to chicken                                                               
farms  of 500  acres or  greater would  constitute a  conflict of                                                               
interest.                                                                                                                       
                                                                                                                                
MR. ANDERSON replied that if  the legislator was the only chicken                                                               
farmer with  500 acres  or more,  he/she would  obviously benefit                                                               
more than the  class of chicken farmers, if  there are provisions                                                               
in the legislation requiring the chicken  farm to be 500 acres or                                                               
more to get the benefits of the legislation.                                                                                    
                                                                                                                                
4:05:29 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE WOOL  asked about a  scenario in which there  is a                                                               
class  of 1,000  chicken farmers  and  a subclass  of 50  chicken                                                               
farmers with 500 acres  or more.  He asked at  what point a group                                                               
constitutes a class and at what point  is a group too small to be                                                               
a class, such  as 5 chicken farmers.  He  suggested that some oil                                                               
companies produce 30,000 barrels of  oil per day and some produce                                                               
100,000 barrels per day.                                                                                                        
                                                                                                                                
MR.  ANDERSON attested  that  the  questions Representative  Wool                                                               
raised  are  the type  of  grappling  questions that  the  Select                                                               
Committee on Legislative Ethics struggles  with when asked for an                                                               
advisory opinion.                                                                                                               
                                                                                                                                
4:07:04 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   KNOPP  offered   that  in   all  the   scenarios                                                               
presented, Mr.  Anderson's response  falls back to  the financial                                                               
benefit.  He  asserted that there are many  conflicts of interest                                                               
that legislators  would uphold on  the floor  that do not  have a                                                               
financial  basis.    He asked  if  all  determinations  regarding                                                               
conflicts  of  interest would  be  made  based on  the  financial                                                               
implications of the legislation.                                                                                                
                                                                                                                                
MR. ANDERSON  answered that the  current law  addresses conflicts                                                               
of  interest  in  terms  of  substantial  benefit  or  harm,  and                                                               
typically they  are in financial  terms.  He conceded  that there                                                               
could be non-quantifiable benefits and  harms that could still be                                                               
basis for conflict of interest.                                                                                                 
                                                                                                                                
4:08:33 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  LEDOUX  presented  a  scenario  as  follows:    a                                                               
legislator has  a family member who  is a lobbyist and  is voting                                                               
on proposed legislation  significant to that family  member.  She                                                               
asked if that would constitute a conflict of interest.                                                                          
                                                                                                                                
MR. ANDERSON replied that more facts  would be needed just as the                                                               
Select Committee on  Legislative Ethics would need  more facts to                                                               
make a determination.  He said  that the question would be, "What                                                               
is the  class of  lobbyist ... being  affected by  that potential                                                               
legislation,  and  is that  harm  any  greater with  that  family                                                               
member?"                                                                                                                        
                                                                                                                                
REPRESENTATIVE LEDOUX  opined that  most people would  agree that                                                               
if there is such a thing  as a conflict of interest, the scenario                                                               
she just suggested would constitute  a conflict of interest.  She                                                               
offered  that if  the proposed  legislation  does not  definitely                                                               
consider that  hypothetical situation as a  conflict of interest,                                                               
then "it's got some big problems."                                                                                              
                                                                                                                                
4:10:20 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK suggested  that  the committee's  discussion                                                               
has  been  on "when  to  declare"  and the  proposed  legislation                                                               
addresses  "after  you  declare."    He  said  that  currently  a                                                               
conflict of  interest does not  have to be declared  in committee                                                               
but must be  declared on the floor  at the time of  a final vote.                                                               
He  maintained  that  the   proposed  legislation  would  require                                                               
declaring a conflict of interest in  committee, as well as on the                                                               
floor, and it is on the  floor that the body of legislators would                                                               
decide  whether the  legislator declaring  the conflict  shall or                                                               
shall  not  vote.    He  asserted that  the  "real"  examples  he                                                               
requested  may provide  clarification.   He mentioned  that under                                                               
the  proposed   legislation  there   are  language   changes  for                                                               
substantial benefit or harm; there  would be exceptions regarding                                                               
the  operating budget;  and "financial  interest" is  defined and                                                               
replaces  "equity ownership."   He  reiterated that  most of  the                                                               
proposed legislation  involves the process of  what happens after                                                               
declaration of a conflict of interest.                                                                                          
                                                                                                                                
MR.  JOHNSTON  referred  to  slide 14,  titled  "HB  44  Proposed                                                               
Changes  to  AS 24.60.030(g),"  and  stated  that CSSSHB  44(JUD)                                                               
would  add  to  AS  24.60.030(g) the  following  statement:    "a                                                               
legislator shall declare a conflict  of interest before voting on                                                               
a question before a committee of  the legislature."  Moving on to                                                               
slide 15, titled "HB 44  Proposed Changes to AS 24.60.030(g)," he                                                               
said that CSSSHB  44(JUD) would add "an  immediate family member"                                                               
as  a  beneficiary  of  a potential  conflict  of  interest,  and                                                               
immediate family is defined in AS 24.60.990(a)(6).                                                                              
                                                                                                                                
MR.  JOHNSTON referred  to slide  16, titled  "Other States  with                                                               
Reference  to  Family,"  and  said   there  are  28  states  with                                                               
statutory  language  covering  the possible  conflicts  involving                                                               
family  members,  such as  the  inclusion  of a  family  member's                                                               
employer  to the  list of  recipients of  a potential  benefit or                                                               
harm from the passage of legislation.                                                                                           
                                                                                                                                
MR.  JOHNSTON  referred  to  slide 17,  titled  "HB  44  Proposed                                                               
Changes  to AS  24.60.030(g),"  and relayed  that CSSSHB  44(JUD)                                                               
would add language  ensuring that every legislator  would be able                                                               
to  vote  on  the  final  operating  budget  as  required  by  AS                                                               
37.07.020(a) and  AS 37.07.100  of the  Executive Budget  Act [AS                                                               
37.07].                                                                                                                         
                                                                                                                                
4:13:44 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  BIRCH referred  to  the  visibility and  exposure                                                               
already  in  place:    every   legislator  completes  a  detailed                                                               
financial disclosure statement, which  is available online to the                                                               
public;  proposed  legislation  is   available  online;  and  the                                                               
legislative process  is public.   He opined that  the legislation                                                               
would result  in a "huge tangle"  of trying to determine  what is                                                               
substantial  and whose  judgement  to follow,  rather than  "just                                                               
putting all  the information  out on  the table."   He  asked Mr.                                                               
Anderson  to identify  for  the committee  a  "real" conflict  of                                                               
interest that occurred  in the past several years  for which this                                                               
legislation would have provided a constructive remedy.                                                                          
                                                                                                                                
REPRESENTATIVE  GRENN  offered  that  currently  one  person  can                                                               
object and force a member of  the legislature to vote without the                                                               
objection  being  on the  public  record.    The details  of  the                                                               
conflict  of  interest  and  of the  request  to  abstain  remain                                                               
unknown.    He maintained  that  the  proposed legislation  would                                                               
allow the legislator to speak  to his/her conflict of interest to                                                               
the benefit of the  rest of the body; the body  would vote on the                                                               
conflict of  interest; and the  vote would become  public record.                                                               
He asserted that if a member  of the public was concerned about a                                                               
legislator's  conflict of  interest, it  would be  in the  public                                                               
record  that he/she  spoke to  the conflict  and the  legislative                                                               
body rejected  the conflict.   He maintained that  CSSSHB 44(JUD)                                                               
would  add  transparency;  would  allow  the  legislature  to  be                                                               
consistent  with  its  own requirement  for  municipalities;  and                                                               
would conform to the practices of 49 other states.                                                                              
                                                                                                                                
REPRESENTATIVE BIRCH  stated that given the  amount of disclosure                                                               
already required of legislators  and the obligation of completing                                                               
legislative work  in a timely fashion,  he does not see  that the                                                               
proposed  legislation  will  speed  up that  process  or  improve                                                               
public perception of legislative work.                                                                                          
                                                                                                                                
REPRESENTATIVE  GRENN  referred  to  slides  18  and  19,  titled                                                               
"Citizen  Legislatures,"  and pointed  out  that  in the  Wyoming                                                               
legislature,  whose legislators  have  low  salaries and  outside                                                               
employment,  there  were  only  10  instances  where  a  declared                                                               
conflict  of  interest needed  a  resolution  in the  past  three                                                               
years.   He  added that  more bills  are introduced  in Wyoming's                                                               
legislature  than are  introduced  in Alaska's  legislature.   He                                                               
reiterated  that  the goal  of  CSSSHB  44(JUD) is  transparency,                                                               
building trust,  and adding legislators' interests  to the public                                                               
record, which would be good for governance.                                                                                     
                                                                                                                                
4:19:18 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHNSON  stated that she  has had a great  deal of                                                               
experience  with this  issue in  her  involvement with  municipal                                                               
government.    She  referred  to   slide  15  and  asked  if  the                                                               
definition for domestic partner is included in statute.                                                                         
                                                                                                                                
MR. JOHNSTON  answered that the  definition for  domestic partner                                                               
is currently in AS 24.60.990(a)(5).                                                                                             
                                                                                                                                
REPRESENTATIVE JOHNSON asked  how the $10,000 per  year limit was                                                               
chosen  and noted  that it  is very  low -  less than  $1,000 per                                                               
month.                                                                                                                          
                                                                                                                                
MR.  JOHNSTON stated  that the  $10,000  per year  limit is  high                                                               
relative to other states.  He  cited other state limits as low as                                                               
$500 per  year.   He explained  that the  limit was  derived from                                                               
Alaska Statutes pertaining  to the limit required of  a member of                                                               
the public in  defining substantial interest.  He  added that the                                                               
proposed legislation specifies that  amount as an amount received                                                               
in the preceding 12-month period.   He maintained that with these                                                               
parameters,  staff tried  to set  a benchmark  that would  ensure                                                               
identification of an employer with which a conflict could arise.                                                                
                                                                                                                                
REPRESENTATIVE   JOHNSON  offered   her  concern   that  minority                                                               
members' votes  would be blocked,  and she asked if  Mr. Johnston                                                               
had done research on that aspect.                                                                                               
                                                                                                                                
MR.  JOHNSON replied  that in  talking with  representatives from                                                               
other  states using  majority consent  from the  body to  address                                                               
declared conflicts of  interest, he did not hear of  any cases of                                                               
that occurring.   He  offered that  because this  involves public                                                               
record, "it's  a double-edged sword  for a majority" to  use this                                                               
politically.    He  noted  that   the  Wyoming  legislature  uses                                                               
majority  consent  of  the  Rules  [&  Procedures]  Committee  to                                                               
require abstention, but he said  that staff considered that to be                                                               
more partisan  than a floor vote.   He reiterated that  [the idea                                                               
of] majority vote  comes from Alaska's statutes,  and most states                                                               
that use a vote to abstain or not abstain uses majority vote.                                                                   
                                                                                                                                
4:23:20 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK  pointed  out   that  CSSSHB  44(JUD)  would                                                               
prevent people from  having to make a declaration  of conflict of                                                               
interest when  voting on the operating  budget, when declarations                                                               
of conflict  of interest are most  common.  He offered  that this                                                               
would  streamline  the  process  because  there  would  be  fewer                                                               
declarations of a  conflict of interest.  He opined  that it is a                                                               
disservice to the  public when before a  legislator even finishes                                                               
declaring a conflict, someone objects.                                                                                          
                                                                                                                                
REPRESENTATIVE KNOPP  stated that in municipal  government when a                                                               
conflict is declared, the chair  decides on the conflict, and the                                                               
body has  the right to  object to  the decision and  overrule the                                                               
chair.   He  opined that  is a  method that  works well  in local                                                               
government,  and he  would  support that  method  applied to  the                                                               
legislature.   He  suggested that  the declarations  of conflicts                                                               
are numerous; legislators don't  necessarily function well on the                                                               
floor; and  he hates  to make  the process  more cumbersome.   He                                                               
expressed that  there is a  tendency to "over-declare"  to "cover                                                               
our bases."   He expressed  that he  supports the changes  to the                                                               
statutes  but struggles  with the  concepts of  "immediate family                                                               
members" and "potential conflicts."                                                                                             
                                                                                                                                
REPRESENTATIVE  GRENN  pointed  the examples  from  other  states                                                               
described on  slides 18  and 19  of the  PowerPoint presentation.                                                               
He concluded  that the proposed  legislation would  offer another                                                               
way to build trust with the  public and avoid any perception that                                                               
there are hidden conflicts.                                                                                                     
                                                                                                                                
[CSSSHB 44(JUD) and HCR 1 were held over.]                                                                                      
                                                                                                                                
4:26:29 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
State Affairs  Standing Committee  meeting was adjourned  at 4:26                                                               
p.m.                                                                                                                            
                                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects