SB 5-POLITICAL CONTRIBUTION LIMITS/PROHIBITION  3:31:09 PM CHAIR DUNLEAVY announced the consideration of SB 5 and asked for a motion to adopt the proposed committee substitute (CS). 3:31:22 PM SENATOR GIESSEL moved to adopt the work draft CS for SB 5, 30- LS0112\O, as the working document. 3:31:41 PM CHAIR DUNLEAVY objected for discussion purposes. 3:31:54 PM SENATOR KEVIN MEYER, Alaska State Legislature, sponsor of SB 5, explained that the bill's intent is to eliminate the appearance of corruption in the campaign-finance system in order to maintain and keep the public's trust. In 1996 the Alaska Legislature passed sweeping campaign finance reforms in response to actual and apparent corruption. One purpose was to limit soft-money contributions from lobbyists and special interest groups. The 1996 Act included the following statement: "It is the purpose of this Act to substantially revise Alaska's campaign finance laws in order to restore the public's trust in the electoral process and to foster good government." SENATOR MEYER explained that lobbyists' contributions to candidates were limited to only those candidates from the district from which the lobbyist is allowed to vote; this was to allow individuals to exercise their first amendment right to support a political candidate within their voting district, but not to influence other elections throughout the state. What was not considered in 1996 were contributions by lobbyists to political action groups (PACs) controlled by a legislator or candidate; SB 5 aims to address that loophole. He provided examples of how a lobbyist could potentially influence decisions by sitting legislators on which bills will be heard in a committee, scheduled for a floor vote, or even how a legislator votes on a particular bill. He concluded that SB 5 will close the loophole that allows lobbyists to contribute to PACs controlled by a legislator or candidate and places a restriction on when these groups can engage in political fundraising. He summarized that the bill aims to make raising money for PACs similar to what it is for candidates running for office. Legislators cannot accept money during the session, nor accept money from lobbyists that live outside the legislator's district. CHAIR DUNLEAVY requested that Ms. Morledge explain the changes in the bill. 3:36:37 PM EDRA MORLEDGE, Staff, Senator Meyer, Alaska State Legislature, Juneau, Alaska, explained that SB 5 prohibits soliciting or accepting contributions and prohibits making expenditures or contributions during the legislative session by groups that are controlled by a legislator or a candidate for the state legislature. The bill also limits the ability of lobbyists to contribute to those groups. She detailed that Section 1 places a restriction on the solicitation or acceptance of contributions. The original draft also had the restriction on making contributions and was placed in the wrong section of statute. Section 2 discusses the prohibited contributions. Section 3 adds a new section to the prohibited contributions and places back into the statute the exceptions for lobbyists to make contributions to candidates from their own voting district. Section 4 places the limitation on expenditures during the legislative session. Section 5 is the definition section. The CS changes a sentence to "unless the context clearly requires otherwise, these definitions apply." 3:39:22 PM CHAIR DUNLEAVY removed his objection. 3:39:35 PM CHAIR DUNLEAVY found no further objection and announced that the CS for SB 5, version O, was adopted. CHAIR DUNLEAVY asked if the bill prohibits lobbyists from donating to a PAC. SENATOR MEYER answered yes. CHAIR DUNLEAVY pointed out that lobbyists cannot donate to an individual now. SENATOR MEYER replied yes. CHAIR DUNLEAVY detailed that lobbyists currently can donate to a PAC controlled by an individual and the bill would prohibit that. He added that the bill would also prohibit the PAC from raising funds during the session, but a PAC controlled by a legislator can raise funds after the session. SENATOR MEYER answered yes, but noted that a lobbyist cannot contribute to a PAC even after session is over. SENATOR GIESSEL noted in Section 3 that an individual lobbyist cannot contribution unless they live in the district in which the individual is eligible to vote. She requested clarification. MS. MORLEDGE answered that Section 3 in the CS is the same language as in current law that allows a lobbyist to contribute to a legislator. She added that Section 2 prohibits a contribution to a group controlled by a legislator or candidate. SENATOR WILSON asked for clarification on the registered address of a PAC. SENATOR MEYER deferred to Ms. Morledge to answer. He said he has concerns about that because it would prohibit a spouse to have a PAC and receive donations from lobbyists. He suggested that an open-ended full disclosure might work better due to all the possible loopholes. 3:43:11 PM SENATOR COGHILL joined the committee meeting. MS. MORLEDGE referred to page 5 of the CS beginning on line 24, the definition of "group" is provided and it also states when a group is considered controlled by a candidate. CHAIR DUNLEAVY asked if the bill impacts the situation where a legislator has a PAC whose purpose is informational only. SENATOR MEYER replied that it is treated the same as any PAC; the legislator would not be able to accept funds during the session. CHAIR DUNLEAVY said the purpose of the PAC has nothing to do with whether they can raise money or not. MS. MORLEDGE answered correct. CHAIR DUNLEAVY asked if the prohibitions would be in place for a legislator who is a member of a PAC. MS. MORLEDGE referred back to the definition of the "group." She said unless the legislator is in control of the group it would not prohibit their activity within a PAC. 3:46:53 PM CHAIR DUNLEAVY announced he would hold SB 5 in committee for further consideration.