Legislature(2007 - 2008)CAPITOL 106

01/23/2007 08:00 AM House STATE AFFAIRS


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
= HB 10 LEGISLATIVE DISCLOSURES/OUTSIDE INCOME
Heard & Held
*+ HB 20 CAMPAIGN FINANCE/LOBBYING/CONSULTING TELECONFERENCED
Heard & Held
HB  10-LEGISLATIVE DISCLOSURES/OUTSIDE INCOME                                                                                 
                                                                                                                                
8:27:20 AM                                                                                                                    
                                                                                                                                
CHAIR LYNN announced  that the first order of  business was HOUSE                                                               
BILL NO. 10,  "An Act prohibiting legislators  and certain former                                                               
legislators  from accepting  or agreeing  to accept  compensation                                                               
for certain  work; relating to disclosures  under the Legislative                                                               
Ethics Act; and providing for an effective date."                                                                               
                                                                                                                                
8:29:00 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   BERTA   GARDNER,   Alaska   State   Legislature,                                                               
introduced HB  10 as  sponsor.   She thanked  Chair Lynn  for his                                                               
leadership on the  issue of ethics, his efforts to  craft a solid                                                               
bill  that will  garner bi-partisan  support, and  the expediency                                                               
with which he scheduled the bill  to be heard.  She stated, "It's                                                               
unfortunate that  scandal and  allegation of  impropriety against                                                               
just a few do taint the entire body."   She relayed that HB 10 is                                                               
not  aimed  at  any  particular individual;  it  applies  to  all                                                               
legislators and  is designed to  promote disclosure  and, through                                                               
that, increase  public confidence.   She said  she and  her staff                                                               
have  worked closely  with the  Alaska Public  Offices Commission                                                               
(APOC),  legislative  legal  teams,  and Joyce  Anderson  on  the                                                               
issue,  listening  to  the  concerns   expressed  and  trying  to                                                               
incorporate them  into the bill.   Representative  Gardner stated                                                               
that  while she  believes HB  10  is a  good bill  and there  are                                                               
provisions  in  it to  which  she  is absolutely  committed,  she                                                               
acknowledges  that there  is still  room for  improvement through                                                               
suggestions.                                                                                                                    
                                                                                                                                
8:31:51 AM                                                                                                                    
                                                                                                                                
JOYCE ANDERSON, Ethics  Committee Administrator, Select Committee                                                               
on  Legislative Ethics,  Alaska  State  Legislature, stated  that                                                               
although  she  has  worked  closely  with  the  offices  of  both                                                               
Representative Gardner and  Chair Lynn in attempting  to make the                                                               
language of  HB 10  clear, she  does not speak  on behalf  of the                                                               
committee that has not yet had a  chance to review the bill.  One                                                               
exception  to that  is Section  2,  she stated,  the language  of                                                               
which she said the committee welcomed  to the bill.  She reviewed                                                               
that Section 2 cements the  advisory opinion issued by the Select                                                               
Committee  on Legislative  Ethics  that legislators,  legislative                                                               
employees,  and  public  members   of  the  Select  Committee  on                                                               
Legislative Ethics should be required  to file ethics disclosures                                                               
for  anything that  occurred  while in  office,  even though  the                                                               
disclosure date may be after they have left office.                                                                             
                                                                                                                                
MS. ANDERSON  expressed a  favorable opinion of  Section 1  of HB
10, because of  the change in the language [in  paragraph 1, page                                                               
1, lines 9-11], which read as follows:                                                                                          
                                                                                                                                
               (1) a former member of the legislature or to                                                                     
     a person  formerly employed  by the  legislative branch                                                                    
     of government unless a [THE]  provision of this chapter                                                            
     specifically states that it applies;                                                                                       
                                                                                                                                
MS. ANDERSON  explained, "So, what  it does is  it opens it  up a                                                               
little bit  and makes it  not just  a particular section  but ...                                                               
for  the  whole chapter."    She  said  Section  4 of  the  bill,                                                               
although in  the ethics  section of  statute, is  administered by                                                               
APOC, thus  she said  she would refrain  from testifying  on that                                                               
particular  section.    She  offered   to  answer  any  questions                                                               
regarding [subsection (c) of] Section 2, which read as follows:                                                                 
                                                                                                                                
          (c) During the term for which elected or                                                                              
     appointed and for one year  thereafter a legislator may                                                                    
     not, directly or  by authorizing another to  act on the                                                                    
     legislator's   behalf,  accept   or  agree   to  accept                                                                    
     compensation,  except from  the  State  of Alaska,  for                                                                    
     work  associated with  legislative, administrative,  or                                                                    
     political action.                                                                                                          
                                                                                                                                
8:34:15 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GRUENBERG asked  if  there are  any other  Select                                                               
Committee  on   Legislative  Ethics'  opinions  that   should  be                                                               
considered for codification.                                                                                                    
                                                                                                                                
MS. ANDERSON  answered yes.  She  stated her intent to  provide a                                                               
list of such to the committee.                                                                                                  
                                                                                                                                
REPRESENTATIVE GRUENBERG  expressed his appreciation of  the work                                                               
of the Select  Committee on Legislative Ethics and  said he looks                                                               
forward to receiving those suggested changes.                                                                                   
                                                                                                                                
8:36:31 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE COGHILL,  regarding Section 2,  questioned whether                                                               
it may  be difficult to determine  whether a person is  acting on                                                               
his/her own behalf or being directed by someone else.                                                                           
                                                                                                                                
MS. ANDERSON responded  that that language is  in another portion                                                               
of  statute  where  the  word  "another",  used  in  "authorizing                                                               
another to act", was meant to mean a staff person.                                                                              
                                                                                                                                
REPRESENTATIVE COGHILL  suggested there  could be  an interesting                                                               
discussion on the topic.                                                                                                        
                                                                                                                                
8:39:25 AM                                                                                                                    
                                                                                                                                
MS. ANDERSON,  in response  to a question  from Chair  Lynn, said                                                               
the  phrase "one  year thereafter"  is "not  specifically in  the                                                               
code   anywhere."     She  stated,   "The  only   prohibition  on                                                               
legislators at this  point is that they cannot  become a lobbyist                                                               
for one year  after they leave office."  She  recalled that there                                                               
is  another  prohibition  that  has   to  do  with  not  allowing                                                               
legislators to take  a job with the state "if  they have actually                                                               
voted on that  particular position."  In response  to a follow-up                                                               
question   from  Chair   Lynn,   she  stated   her  belief   that                                                               
administering  the  rule about  "one  year  thereafter" would  be                                                               
difficult from the point of view of the committee.                                                                              
                                                                                                                                
8:40:31 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRUENBERG  commented that the Select  Committee on                                                               
Legislative  Ethics'  jurisdiction   ends  after  the  legislator                                                               
leaves office.   He asked Ms.  Anderson if she thinks  the Select                                                               
Committee on Legislative Ethics should  be allowed to take action                                                               
on  "something appropriate"  after the  legislator leaves  office                                                               
or,  if  not,   "how  would  they  enforce  this   for  one  year                                                               
thereafter?"                                                                                                                    
                                                                                                                                
8:41:35 AM                                                                                                                    
                                                                                                                                
MS. ANDERSON responded that the  "legislators are covered for one                                                               
year after  they leave office,  for the purpose of  filing ethics                                                               
complaints."   She  said  once a  legislative  employee has  left                                                               
employment,  the Select  Committee on  Legislative Ethics  has no                                                               
jurisdiction over  them.  Furthermore,  in the ethics  code there                                                               
is a sanction section.  She continued:                                                                                          
                                                                                                                                
     So, if  a legislator were  to leave office  and violate                                                                    
     this new section of the  code that we're ... looking at                                                                    
     today, if a complaint  was filed, the [Select Committee                                                                    
     on Legislative Ethics] would  have jurisdiction to look                                                                    
     at that particular complaint if  they found that person                                                                    
     in violation.   The sanction section of  the code would                                                                    
     allow the committee to issue a  fine of up to $5,000 if                                                                    
     they felt [that  to be] appropriate.  That  is the only                                                                    
     penalty  that I  see in  here at  this point.   So,  in                                                                    
     looking at the new language,  there would really not be                                                                    
     a penalty involved  with a violation if it  was for one                                                                    
     year thereafter,  unless a complaint was  filed against                                                                    
     a particular legislator.                                                                                                   
                                                                                                                                
8:42:51 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   GRUENBERG    drew   attention   to    the   word                                                               
"compensation" on  page 3,  line 2.   He said  that in  the legal                                                               
sense, the word usually denotes income,  and he said he could see                                                               
somebody  arguing that  he/she was  not getting  compensation but                                                               
was  being given  a gift.   He  suggested that  a phrase  such as                                                               
"anything of value" be used instead.                                                                                            
                                                                                                                                
8:43:26 AM                                                                                                                    
                                                                                                                                
IRIS  MATTHEWS, Staff  to  Representative  Berta Gardner,  Alaska                                                               
State  Legislature,   testifying  on  behalf   of  Representative                                                               
Gardner,  sponsor, noted  that "compensation"  is  defined in  AS                                                               
24.60.990 [paragraph (4)], which read as follows:                                                                               
                                                                                                                                
          (4)   "compensation"    means   remuneration   for                                                                    
     personal  services  rendered, including  salary,  fees,                                                                    
     commissions,  bonuses, and  similar payments,  but does                                                                    
     not include reimbursement  for actual expenses incurred                                                                    
     by a person;                                                                                                               
                                                                                                                                
REPRESENTATIVE GRUENBERG  said Ms. Matthews just  defined what is                                                               
income, but someone could maintain  that what they were given was                                                               
a gift.                                                                                                                         
                                                                                                                                
8:44:13 AM                                                                                                                    
                                                                                                                                
MS. MATTHEWS responded  that "anything of value"  is also defined                                                               
in [part of AS 24.60.990(a)(2)], which read as follows:                                                                         
                                                                                                                                
          (2) "anything of value," "benefit," or "thing of                                                                      
     value"  includes  all   matters,  whether  tangible  or                                                                    
     intangible, that  could reasonably be considered  to be                                                                    
     a  material  advantage,  of  material  worth,  use,  or                                                                    
     service  to the  person to  whom it  is conferred;  the                                                                    
     terms  are  intended  to  be  interpreted  broadly  and                                                                    
     encompass  all matters  that the  recipient might  find                                                                    
     sufficiently  desirable  to  do something  in  exchange                                                                    
     for;                                                                                                                       
                                                                                                                                
MS.  MATTHEWS  noted  that  the  statute goes  on  to  list  some                                                               
exceptions.   She  noted that  that statute  is available  in the                                                               
committee packet.                                                                                                               
                                                                                                                                
8:45:02 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  COGHILL remarked,  "The exception  is some  value                                                               
for  state  work  associated  with  legislative,  administrative,                                                               
political  action."    He  asked Ms.  Anderson,  "What  was  your                                                               
thinking ... on  the political action part, as far  as being paid                                                               
by the state?  That would be a policy action?"                                                                                  
                                                                                                                                
                                                                                                                                
8:45:33 AM                                                                                                                    
                                                                                                                                
MS. ANDERSON replied:                                                                                                           
                                                                                                                                
     When   I  met   with  both   Representative  Lynn   and                                                                    
     Representative  Gardner's office,  I expressed  to them                                                                    
     that all three  of those terms have really  not had any                                                                    
     particular  discussion  by  the ethics  committee,  and                                                                    
     there are  really not any  advisory opinions  that have                                                                    
     dealt with those particular definitions  in any part of                                                                    
     the code.   So, I  guess I would  have to look  at your                                                                    
     question and ... do a  little bit more research and get                                                                    
     back to you.                                                                                                               
                                                                                                                                
REPRESENTATIVE  COGHILL  stressed  the importance  of  clarifying                                                               
which  actions are  okay.   If  the state  is  going to  prohibit                                                               
someone from political action that  comes with some reward to it,                                                               
for a whole year after he/she is  out of office, "we want to take                                                               
a good, hard look  at that."  He added, "If it's  paid for by the                                                               
state, that might  be just as big  a problem as if  it's paid for                                                               
by anybody else."                                                                                                               
                                                                                                                                
8:46:55 AM                                                                                                                    
                                                                                                                                
MS. MATTHEWS began her review of HB  10.  She said the bill would                                                               
do three things:  prohibit  legislators from taking certain types                                                               
of  paid  work outside  of  their  legislative position;  require                                                               
greater  disclosure  of   some  of  the  outside   work  done  by                                                               
legislators;  and require  a disclosure  requirement.   She  said                                                               
there is also some "clean-up language"  in the bill, and the meat                                                               
of  bill is  in Sections  2,  3, and  4.   Ms. Matthews  reviewed                                                               
Section 2 of  the bill [text provided previously].   She said the                                                               
intent is to  ensure that legislators are only paid  by the State                                                               
of  Alaska   for  "legislative-type   work."    Section   3,  she                                                               
explained, would  require a legislator, legislative  employee, or                                                               
public member  of the  committee leaving office  to file  a final                                                               
disclosure.   She noted that  the language in Section  3 supports                                                               
an advisory opinion filed by  the Select Committee on Legislative                                                               
Ethics in  December 2006.   Section 4 would ask  that legislators                                                               
filling  out forms  provide more  specific information  regarding                                                               
the nature  of the work they've  done.  Most people  know what an                                                               
accountant or lawyer does, Ms.  Matthews said, but there are some                                                               
jobs  that are  less  known.   Section 4  would  give the  public                                                               
additional tools with which to  look at disclosures and determine                                                               
whether or not people are being compensated fairly.                                                                             
                                                                                                                                
8:50:49 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GRUENBERG disclosed  that he  is a  nonpracticing                                                               
member  of  the Alaska  Bar.    He  drew  attention to  the  word                                                               
"administrative" on page 2, line 4, and asked:                                                                                  
                                                                                                                                
     If I were to go back  to practicing family law and took                                                                    
     child support cases - either  people seeking to collect                                                                    
     child  support or  change child  support, or  defending                                                                    
     those  case   before  the  Child   Support  Enforcement                                                                    
     Division - would that now be prohibited?                                                                                   
                                                                                                                                
MS. MATTHEWS answered yes.  She continued:                                                                                      
                                                                                                                                
     Any sort of appearance  under an administrative hearing                                                                    
     would have to be prohibited  under this statute.  And I                                                                    
     think there's  been a lot  of discussion about  that as                                                                    
     we've  talked  about  it.   [The  Select  Committee  on                                                                    
     Legislative  Ethics] issued  an  opinion  ... a  little                                                                    
     over a year ago about  legislators working on behalf of                                                                    
     their   constituents   before  administrative   hearing                                                                    
     officers,   and  there   was  the   feeling  that   ...                                                                    
     legislators  should  not  be talking  to  the  decision                                                                    
     makers in  those cases  on these  constituents' issues.                                                                    
     We  think   it's  reasonable  to  expect   that  ...  a                                                                    
     legislator appearing  before a  hearing officer  may be                                                                    
     treated differently  than another attorney  who doesn't                                                                    
     have that title.                                                                                                           
                                                                                                                                
REPRESENTATIVE  GRUENBERG questioned  what evidence  Ms. Matthews                                                               
has to support her statement.  He clarified:                                                                                    
                                                                                                                                
     I'm talking about a situation  such as the hypothetical                                                                    
     that I  gave, where most  family lawyers do  take child                                                                    
     support cases, and many times  they go before the Child                                                                    
     Support Enforcement  Division.   That's a  very serious                                                                    
     allegation  that  ...  you're making  against  a  large                                                                    
     number of  attorneys, ... frankly, and  other attorneys                                                                    
     who  practiced maybe  before  the Commercial  Fisheries                                                                    
     Entry  Commission,  and  all  kind  of  agencies  maybe                                                                    
     taking  procurement cases  under the  procurement code,                                                                    
     or anything  ....  Very  many lawyers in this  state do                                                                    
     that.   And are  you aware  of any  circumstances where                                                                    
     that sort of thing --  because you're going to prohibit                                                                    
     a whole profession from practicing with your limits."                                                                      
                                                                                                                                
8:53:17 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GARDNER  provided the  response, stating  that she                                                               
has no  intention of maligning  anybody's intention  or behavior.                                                               
She  explained that  the bill  is attempting  to clarify  what is                                                               
acceptable, honorable,  and worthy of  respect.  She said  she is                                                               
not fully  committed to this  particular provision;  however, she                                                               
said  she wants  to ensure  people don't  have the  perception of                                                               
"taking advantage  of their office  in employment,  while they're                                                               
legislators  or shortly  thereafter -  that they  don't trade  on                                                               
that title."   She suggested that the period of  one year may not                                                               
be the best timing.                                                                                                             
                                                                                                                                
REPRESENTATIVE GRUENBERG  replied that he is  not concerned about                                                               
the  time.    He  said  he is  more  concerned  with  the  quasi-                                                               
adjudicative function than  the rulemaking function.   He said he                                                               
thinks  attorneys, for  example, should  be able  to appear  in a                                                               
foreign agency in a quasi-adjudicative function.                                                                                
                                                                                                                                
REPRESENTATIVE GARDNER  proffered that  the point to  consider is                                                               
whether a  member of  the public  with a  child support  case who                                                               
wants  to hire  an attorney  will  think he/she  stands a  better                                                               
chance in  hiring an attorney  who is also a  representative over                                                               
"Mr. Average attorney."                                                                                                         
                                                                                                                                
8:55:41 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRUENBERG  responded, "That  would be  like saying                                                               
you can't  go before a judge  because you're going to  get better                                                               
treatment as an attorney before a  superior court judge ...."  He                                                               
noted  that  hearing  officers   are  held  to  a  quasi-judicial                                                               
standard of conduct.                                                                                                            
                                                                                                                                
8:56:21 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE    GARDNER    stated    that    she    understands                                                               
Representative Gruenberg's concern; however,  she said the intent                                                               
is  to convey  that  the legislators  will be  held  to a  higher                                                               
standard.  As public citizens  become public officials, she said,                                                               
they give  up some opportunities,  give up privacy,  and disclose                                                               
details  that  as  private  citizens   they  never  would.    She                                                               
reiterated her willingness to consider amendments to the bill.                                                                  
                                                                                                                                
8:57:06 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE    ROSES   expressed    concern   regarding    the                                                               
retroactivity aspect of  bill.  He clarified that if  the bill is                                                               
adopted, not only  will legislators and employees  not be allowed                                                               
to perform  certain work for  one year after leaving  office, but                                                               
"we  have  another clause  in  here  where  we  want to  go  back                                                               
retroactively  and require  a change  in behavior  of those  that                                                               
have already  left office."   He asked,  "If we're going  to hold                                                               
ourselves to  a certain standard,  why would  we then want  to go                                                               
back  and change  the conditions  under which  other people  have                                                               
already served?"                                                                                                                
                                                                                                                                
8:58:38 AM                                                                                                                    
                                                                                                                                
MS. MATTHEWS indicated that the  proposed legislation mirrors the                                                               
advisory opinion  of the Select Committee  on Legislative Ethics,                                                               
which requires those leaving office to file disclosures.                                                                        
                                                                                                                                
REPRESENTATIVE  GRUENBERG said  he  would like  the committee  to                                                               
take  a legal  look at  the issue,  because he  said he  does not                                                               
think retroactive measures would be required.                                                                                   
                                                                                                                                
9:00:07 AM                                                                                                                    
                                                                                                                                
MS. MATTHEWS  said there are  examples of reporting  deadlines in                                                               
The Legislative  Advisor, a publication  generated by  the Select                                                             
Committee  on   Legislative  Ethics.    Those   examples  include                                                               
legislators leaving office  on January 16 and  specify that those                                                               
legislators  would   be  subject   to  the  March   15  recording                                                               
requirements.                                                                                                                   
                                                                                                                                
REPRESENTATIVE GRUENBERG  reiterated that  he would like  a legal                                                               
opinion.                                                                                                                        
                                                                                                                                
9:00:54 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE ROSES stated that he  does not have a problem with                                                               
the  proposed legislation,  although it  may need  some tweaking.                                                               
He stated that when the prior  set of legislators were sworn into                                                               
office, they  had a  set of  regulations, guidelines,  and ethics                                                               
that they were supposed to follow,  and to go back now to clarify                                                               
situations under  which they  were sworn  in and  hold them  to a                                                               
different standard from what they  were expected to uphold in the                                                               
beginning gives him concern.                                                                                                    
                                                                                                                                
9:02:01 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GARDNER  reiterated Ms. Matthews'  previous remark                                                               
that the  bill is clarifying  the advisory opinion and  making it                                                               
less ambiguous.                                                                                                                 
                                                                                                                                
REPRESENTATIVE  ROSES  said  he appreciates  what  Representative                                                               
Gardner is  saying; however,  he anticipates  offering amendments                                                               
on this issue.                                                                                                                  
                                                                                                                                
REPRESENTATIVE GARDNER suggested Ms.  Anderson be included in the                                                               
discussion the next time the bill is heard.                                                                                     
                                                                                                                                
9:03:01 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRUENBERG  stated for the record  his concern with                                                               
[subparagraph (B),  on lines  1-2], page  3, which  would require                                                               
the disclosure  of the total  number of hours spent  on services.                                                               
He opined that there needs to  be some language included to allow                                                               
APOC  or some  other  entity  to use  a  different standard  when                                                               
hourly wages are not applicable.   Taxi drivers, for example, are                                                               
paid by the mile, not by the hour, he said.                                                                                     
                                                                                                                                
9:04:50 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE COGHILL spoke  of trading.  He  suggested using an                                                               
industry  standard rather  than figuring  service by  hours.   He                                                               
stated his agreement with the  concept that a person shouldn't be                                                               
receiving an inordinate amount of  money just because he/she is a                                                               
legislator.                                                                                                                     
                                                                                                                                
9:06:53 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GARDNER said this issue  is the heart of the bill.                                                               
Notwithstanding that,  she said she  is willing to speak  to APOC                                                               
to find some other language  to satisfy the concerns expressed by                                                               
the committee, while keeping the bill strong.                                                                                   
                                                                                                                                
9:08:23 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRUENBERG said he just wants what is fair.                                                                       
                                                                                                                                
9:08:34 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GARDNER  noted that  a representative of  APOC was                                                               
available to testify.                                                                                                           
                                                                                                                                
9:08:58 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHNSON  brought  up   another  issue,  which  is                                                               
working  for commissions.   He  said many  people generate  their                                                               
living in this manner and,  looked at from an hourly perspective,                                                               
one  hour  may garner  a  disproportionately  large income  while                                                               
another will earn almost none.  He mentioned real estate work.                                                                  
                                                                                                                                
9:09:43 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   GARDNER  noted   that   realtors  are   licensed                                                               
professionals, thus they  would not have to disclose  in the same                                                               
detail.  She said a realtor who  sold one house and made a lot of                                                               
money also  spent time designing  and running  the advertisement.                                                               
Because  of  the  nature  of  the work,  the  time  spent  is  an                                                               
estimate.                                                                                                                       
                                                                                                                                
9:10:12 AM                                                                                                                    
                                                                                                                                
CHAIR LYNN disclosed that he holds a real estate license.                                                                       
                                                                                                                                
9:10:18 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHNSON  suggested that  real estate may  not have                                                               
been  the best  example.   He  stated  that there  are  a lot  of                                                               
workers who earn commission but whose  income is not "cut and dry                                                               
on a contract."                                                                                                                 
                                                                                                                                
9:10:40 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GARDNER noted  that under  current law,  a person                                                               
can report $100,000  in services with no other  information.  She                                                               
added, "And  while this  proposal may be  imperfect, it  still, I                                                               
think, is better  to say, '$100,000 for 10  hours [than] $100,000                                                               
- none of your business.'"                                                                                                      
                                                                                                                                
9:11:32 AM                                                                                                                    
                                                                                                                                
BROOKE   MILES,  Executive   Director,   Alaska  Public   Offices                                                               
Commission (APOC), stated that that HB  10, for the first time in                                                               
Alaska  law, codifies  the  fact that  dividends  from a  limited                                                               
liability company are income and must  be disclosed as such.  She                                                               
said  APOC appreciates  the clarification,  which she  noted will                                                               
provide  a useful  tool in  enforcing financial  disclosure laws.                                                               
Additionally,  HB  10 provides  that  when  a person  subject  to                                                               
legislative ethics  law, particularly a legislator,  is providing                                                               
professional services  for remuneration,  those services  must be                                                               
described  in sufficient  detail for  the public  knows what  the                                                               
legislator actually did for his/her employer or client.                                                                         
                                                                                                                                
MS. MILES opined:                                                                                                               
                                                                                                                                
     In  that ...  legislative ethics  code ...,  we have  a                                                                    
     measure that prohibits legislators  from being paid for                                                                    
     work that  is not commensurate with  the amount they're                                                                    
     paid.   And  so, should  an allegation  be made  to the                                                                    
     committee that  a legislator has violated  this section                                                                    
     of  law, having  a standard  that's disclosed  on their                                                                    
     public  disclosure statement  would  be  a very  useful                                                                    
     tool to the committee.                                                                                                     
                                                                                                                                
MS. MILES expressed  appreciation for the clarity in  the bill on                                                               
page 3,  subparagraph (C), which instructs  a legislator, already                                                               
required to disclose a source of  income, to report the amount of                                                               
that income.   She said the  language is without the  caveat that                                                               
that income  have an interest in  legislative, administrative, or                                                               
political action.   She explained that that  caveat is subjective                                                               
and has  caused confusion  and a  lack of  full reporting  in the                                                               
past, "in an  accidental way."  The measure, she  added, will not                                                               
have fiscal impact on the work of the commission.                                                                               
                                                                                                                                
9:15:10 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GRUENBERG told  Ms.  Miles that  he supports  the                                                               
elimination of language  on page 3, lines 4-6;  however, he noted                                                               
that  the same  language is  not  being eliminated  from page  3,                                                               
lines 9-10.  He asked if she thought it should be.                                                                              
                                                                                                                                
9:16:55 AM                                                                                                                    
                                                                                                                                
MS. MILES  agreed it  would be  easier to  administer the  law if                                                               
that language was removed from lines 9-10.                                                                                      
                                                                                                                                
REPRESENTATIVE GRUENBERG  directed attention to page  2, line 24,                                                               
regarding dividends  received from  a limited  liability company,                                                               
and he suggested that something  like "anything else of value" be                                                               
added.   He explained  that it  is easy  to call  something other                                                               
than a  dividend.   Furthermore, he  suggested that  the language                                                               
say  "any kind  of  an entity"  to  include sole  proprietorship,                                                               
limited liability  partnership, or a  corporation.  He  said that                                                               
would get rid of wiggle room in the language.                                                                                   
                                                                                                                                
MS.  MILES  answered  that  APOC  would  find  any  clarification                                                               
language to  be acceptable and  welcome.  She noted  that limited                                                               
liability  companies  did not  exist  at  the time  the  original                                                               
language in statute  was created.  She stated, "We  would like to                                                               
make sure that we encompass all."                                                                                               
                                                                                                                                
The committee took an at-ease from 9:19:37 to 9:20:10 AM.                                                                   
                                                                                                                                
9:20:33 AM                                                                                                                    
                                                                                                                                
STEVE CLARY, Executive Director,  Alaska Public Interest Research                                                               
Group (AkPIRG),  testified in favor of  HB 10.  He  mentioned his                                                               
and  many others'  participation  in forums  [related to  ethics]                                                               
held  in  Anchorage  and  Juneau.   He  said  he  is  excited  in                                                               
anticipating the  result of the  forums, the  legislature's focus                                                               
on ethics, and  the administration's input.  He said  the bill is                                                               
simple  in  its intent  to  ensure  legislators don't  use  their                                                               
office incorrectly and that they  disclose the work that they are                                                               
doing.   He posited that  critical to having  citizen legislature                                                               
is letting the  public know what the members are  doing for money                                                               
earned  outside  of   the  legislature.    He   said  the  bill's                                                               
bipartisan sponsorship  is a great  effort, and he  looks forward                                                               
to the  legislature's putting together  the best of the  bills to                                                               
bring about what's best for Alaskans.                                                                                           
                                                                                                                                
9:23:58 AM                                                                                                                    
                                                                                                                                
CHAIR LYNN announced that HB 10 was heard and held.                                                                             
                                                                                                                                
HB  20-CAMPAIGN FINANCE/LOBBYING/CONSULTING                                                                                   
                                                                                                                                
[Contains brief mention of HB 10]                                                                                               
                                                                                                                                
9:24:14 AM                                                                                                                    
                                                                                                                                
CHAIR LYNN  announced that the  last order of business  was HOUSE                                                               
BILL  NO.  20,  "An  Act   relating  to  disclosure  of  campaign                                                               
contributions;  prohibiting  spouses  and  domestic  partners  of                                                               
legislators    and   legislative    employees   from    receiving                                                               
compensation  for  lobbying;   and  prohibiting  legislators  and                                                               
legislative  employees from  entering into  contracts to  provide                                                               
consulting services."                                                                                                           
                                                                                                                                
9:24:22 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHN HARRIS,  Alaska State Legislature, testifying                                                               
as sponsor  of HB 20, noted  that over the years,  government has                                                               
been made more  and more complicated, and he  stated his position                                                               
that  the   legislature  should   make  serving   government  "as                                                               
convenient  and as  easy  for as  many people  in  this state  to                                                               
qualify  to be  a  legislator."   He  said former  Representative                                                               
Ethan Berkowitz commented that one  of the biggest ethical issues                                                               
in the  legislature is the  Constitutional Budget  Reserve (CBR).                                                               
Representative Harris said  probably 95 percent of  the people in                                                               
Alaska don't understand that it  requires a three-quarter vote of                                                               
the  legislature to  take  money  from the  CBR.    He said  vote                                                               
trading  occurs frequently  [relating to  control of  CBR votes].                                                               
Representative  Harris said  he thinks  that is  what the  public                                                               
does  not want,  but nevertheless  it  happens.   He asked,  "So,                                                               
should  we do  away with  the CBR?   The  public put  it in,  the                                                               
public  has  to  take  it  away."    He  stated  that  everything                                                               
previously   discussed  related   to  HB   10  would   "create  a                                                               
difficulty."  He suggested that  the way to simplify things would                                                               
be to take  away the ability of a legislature  to work outside of                                                               
the legislature  entirely.  The only  way that could be  done, he                                                               
related, is  to pay legislators  enough money so they  can afford                                                               
to serve.   Representative Harris said he is  not suggesting that                                                               
manner of  simplification, but  reiterated that  that is  what it                                                               
would take.   He said he doesn't disagree  with reporting income.                                                               
The focus,  he suggested, must  be, "How do  we make it  the very                                                               
best  to  get the  most  amount  of people  to  qualify  to be  a                                                               
legislator?"   He said he  thinks that's the question  the public                                                               
wants  asked.   Many people  don't want  their business  dealings                                                               
disclosed and, thus, won't run for office.                                                                                      
                                                                                                                                
REPRESENTATIVE HARRIS said  there are other options  of which the                                                               
public should be  aware.  For example, many  states have switched                                                               
to holding  shorter legislative  sessions, holding  session every                                                               
two years, or having a biannual budget.                                                                                         
                                                                                                                                
REPRESENTATIVE  HARRIS,  in response  to  a  question from  Chair                                                               
Lynn,  agreed  that  morality  cannot be  legislated.    He  said                                                               
guidelines can  be set so that  there is a penalty  for unethical                                                               
behavior.    He   explained  that  what  he   was  talking  about                                                               
previously is  the issue of compensation.   He said he  works for                                                               
salary  and he  did  not  work at  all  last  summer because  the                                                               
legislature is  on call  at the  behest of  the governor  and the                                                               
governor  had the  legislature "under  the threat  of a  call all                                                               
summer and all  fall."  He said he is  not complaining, but wants                                                               
to point  out that  not many  people in  the public  would endure                                                               
that.                                                                                                                           
                                                                                                                                
9:33:50 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE HARRIS  said he  asked the  governor if  she would                                                               
sponsor an ethics  bill, and he told the committee  that he would                                                               
be working closely to help move along such a bill.                                                                              
                                                                                                                                
9:34:48 AM                                                                                                                    
                                                                                                                                
CHAIR LYNN  said it  may be  better to  work with  the governor's                                                               
bill because "she certainly has  more horsepower than the rest of                                                               
us."  Notwithstanding that, he  recommended hearing all the other                                                               
ethics bills  that are  put across  the House  Floor in  order to                                                               
incorporate them into the governor's  bill.  He stated that there                                                               
are  laws  against   burglary  and  theft,  thus,   he  said  the                                                               
government legislates morality all the time with civil law.                                                                     
                                                                                                                                
REPRESENTATIVE HARRIS said he is  not arguing that guidelines are                                                               
bad;  he is  just pointing  out that  having laws  does not  make                                                               
people better and will not  prevent people from choosing to break                                                               
the law.                                                                                                                        
                                                                                                                                
REPRESENTATIVE HARRIS  spoke of the effect  one person's breaking                                                               
the law  has on the  rest of the  group to which  he/she belongs.                                                               
He  said it  is a  very  uncomfortable feeling  to be  associated                                                               
through  the  public  eye  with   a  member  or  members  of  the                                                               
legislature  who  may  not  be  ethical.    He  stated  that  the                                                               
legislature sets the guidelines for ethical behavior.                                                                           
                                                                                                                                
9:39:07 AM                                                                                                                    
                                                                                                                                
CHAIR LYNN talked  about the complexity of the issue  and said he                                                               
thinks most everyone is an  honest, hard-working, ethical person,                                                               
doing the  best he/she can.   He said the legislature  deals with                                                               
controversial issues and "nothing is simple."                                                                                   
                                                                                                                                
9:40:05 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   HARRIS,   in   response  to   a   comment   from                                                               
Representative  Gruenberg, said  as of  yesterday the  governor's                                                               
bill will not be limited to administrative ethics.                                                                              
                                                                                                                                
REPRESENTATIVE GRUENBERG responded  by emphasizing the importance                                                               
of including  the minority  party in  discussions related  to all                                                               
ethics bills.   He stated  that to  have real credibility,  HB 20                                                               
should have  the support of  the Democrats, the  Republicans, the                                                               
governor,  and the  press.   If  an  ethics bill  is  seen to  be                                                               
partisan  or  advancing  a  hidden agenda  not  in  the  public's                                                               
interest,  then  "the  entire   public  servant  profession  will                                                               
receive the black eye ...."                                                                                                     
                                                                                                                                
REPRESENTATIVE  HARRIS  concurred with  Representative  Gruenberg                                                               
and said he thinks the  governor, although a Republican, wants to                                                               
be  inclusive of  all parties.   He  said he  would ask  that the                                                               
governor make certain she include everyone in the discussion.                                                                   
                                                                                                                                
CHAIR LYNN  said, "Really,  the bill should  be sponsored  by our                                                               
constituents; it's what it's all about."                                                                                        
                                                                                                                                
REPRESENTATIVE  HARRIS said  the consultant  hired to  present an                                                               
ethics seminar last  week to the legislators  and staff mentioned                                                               
the  fact that  it is  always the  group in  power that  will get                                                               
nailed with the ethics complaints,  because that group makes more                                                               
of the  decisions.   Trying to  impose [blame]  is a  mistake, he                                                               
indicated.  He gave Representative  Gruenberg his word that "this                                                               
will not be a partisan issue ...."                                                                                              
                                                                                                                                
9:45:27 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  HARRIS stated  that  HB 20  is  important to  the                                                               
social and ethical  climate of the legislature,  and he expressed                                                               
his appreciation  for the committee's  hearing the bill  early in                                                               
the session.                                                                                                                    
                                                                                                                                
TOM  WRIGHT, House  Majority  Office,  Alaska State  Legislature,                                                               
testifying on behalf of the  House Majority Office, noted that HB
20 was  written with  broad language  intentionally to  allow for                                                               
the anticipated discussion of the issues addressed in the bill.                                                                 
                                                                                                                                
[HB 20 was heard and held.]                                                                                                     

Document Name Date/Time Subjects