Legislature(2021 - 2022)GRUENBERG 120
03/22/2022 03:00 PM House STATE AFFAIRS
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| Audio | Topic |
|---|---|
| Start | |
| HB401 | |
| HB396 | |
| SB95 | |
| HB309 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 401 | TELECONFERENCED | |
| += | HB 396 | TELECONFERENCED | |
| += | HB 142 | TELECONFERENCED | |
| + | SB 95 | TELECONFERENCED | |
| += | HB 309 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
ALASKA STATE LEGISLATURE
HOUSE STATE AFFAIRS STANDING COMMITTEE
March 22, 2022
3:07 p.m.
MEMBERS PRESENT
Representative Jonathan Kreiss-Tomkins, Chair
Representative Matt Claman, Vice Chair
Representative Geran Tarr
Representative Andi Story
Representative Sarah Vance
Representative James Kaufman
Representative David Eastman
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 401
"An Act relating to certain investments of state funds in the
Russian Federation and financial institutions profiteering from
the Russian Federation's invasion of Ukraine; providing
indemnity and immunity for certain investment actions taken in
compliance with law; and providing for an effective date."
- HEARD & HELD
HOUSE BILL NO. 396
"An Act restricting certain investments of state funds in
certain Russian entities; and providing for an effective date."
- HEARD & HELD
CS FOR SENATE BILL NO. 95(STA)
"An Act relating to the right of first refusal of a volunteer
search and rescue group with respect to obsolete or surplus
state property."
- HEARD & HELD
HOUSE BILL NO. 309
"An Act exempting candidates for municipal office and municipal
office holders in municipalities with a population of 15,000 or
less from financial or business interest reporting requirements;
relating to campaign finance reporting by certain groups; and
providing for an effective date."
- HEARD & HELD
HOUSE BILL NO. 142
"An Act relating to eligibility for the permanent fund
dividend."
- SCHEDULED BUT NOT HEARD
PREVIOUS COMMITTEE ACTION
BILL: HB 401
SHORT TITLE: NO STATE INVESTMENT IN RUSSIAN FEDERATION
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR
03/16/22 (H) READ THE FIRST TIME - REFERRALS
03/16/22 (H) STA, FIN
03/22/22 (H) STA AT 3:00 PM GRUENBERG 120
BILL: HB 396
SHORT TITLE: DIVEST INVESTMENTS IN RUSSIAN ENTITIES
SPONSOR(s): STATE AFFAIRS
03/09/22 (H) READ THE FIRST TIME - REFERRALS
03/09/22 (H) STA, FIN
03/10/22 (H) STA AT 3:00 PM GRUENBERG 120
03/10/22 (H) Heard & Held
03/10/22 (H) MINUTE(STA)
03/15/22 (H) STA AT 3:00 PM GRUENBERG 120
03/15/22 (H) Heard & Held
03/15/22 (H) MINUTE(STA)
03/17/22 (H) STA AT 3:00 PM GRUENBERG 120
03/17/22 (H) <Bill Hearing Canceled>
03/22/22 (H) STA AT 3:00 PM GRUENBERG 120
BILL: SB 95
SHORT TITLE: SEARCH AND RESCUE SURPLUS STATE PROPERTY
SPONSOR(s): WILSON
03/03/21 (S) READ THE FIRST TIME - REFERRALS
03/03/21 (S) STA, FIN
03/16/21 (S) STA AT 3:30 PM BUTROVICH 205
03/16/21 (S) Heard & Held
03/16/21 (S) MINUTE(STA)
03/30/21 (S) STA AT 3:30 PM BUTROVICH 205
03/30/21 (S) Moved CSSB 95(STA) Out of Committee
03/30/21 (S) MINUTE(STA)
03/31/21 (S) STA RPT CS (FORTHCOMING) 3DP 2NR
03/31/21 (S) NR: SHOWER, REINBOLD
03/31/21 (S) DP: KAWASAKI, COSTELLO, HOLLAND
04/03/21 (S) STA CS RECEIVED NEW TITLE
04/07/21 (S) FIN AT 9:00 AM SENATE FINANCE 532
04/07/21 (S) Heard & Held
04/07/21 (S) MINUTE(FIN)
04/27/21 (S) FIN AT 9:00 AM SENATE FINANCE 532
04/27/21 (S) Moved CSSB 95(STA) Out of Committee
04/27/21 (S) MINUTE(FIN)
04/28/21 (S) FIN RPT CS(STA) 7DP
04/28/21 (S) DP: STEDMAN, BISHOP, HOFFMAN, WILSON,
WIELECHOWSKI, OLSON, VON IMHOF
05/03/21 (S) TRANSMITTED TO (H)
05/03/21 (S) VERSION: CSSB 95(STA)
05/04/21 (H) READ THE FIRST TIME - REFERRALS
05/04/21 (H) CRA, STA
05/13/21 (H) CRA RPT 4DP 2NR 1AM
05/13/21 (H) DP: DRUMMOND, MCCABE, PATKOTAK, SCHRAGE
05/13/21 (H) NR: MCCARTY, PRAX
05/13/21 (H) AM: HANNAN
05/13/21 (H) CRA AT 8:00 AM BARNES 124
05/13/21 (H) Moved CSSB 95(STA) Out of Committee
05/13/21 (H) MINUTE(CRA)
03/22/22 (H) STA AT 3:00 PM GRUENBERG 120
BILL: HB 309
SHORT TITLE: APOC; CAMPAIGN CONTRIBUTIONS/REPORTING
SPONSOR(s): KREISS-TOMKINS
02/07/22 (H) READ THE FIRST TIME - REFERRALS
02/07/22 (H) CRA, STA
03/03/22 (H) CRA AT 8:00 AM BARNES 124
03/03/22 (H) Heard & Held
03/03/22 (H) MINUTE(CRA)
03/08/22 (H) CRA AT 8:00 AM BARNES 124
03/08/22 (H) Heard & Held
03/08/22 (H) MINUTE(CRA)
03/10/22 (H) CRA AT 8:00 AM BARNES 124
03/10/22 (H) Moved CSHB 309(CRA) Out of Committee
03/10/22 (H) MINUTE(CRA)
03/14/22 (H) CRA RPT CS(CRA) 1DP 1NR 3AM
03/14/22 (H) DP: MCCARTY
03/14/22 (H) NR: SCHRAGE
03/14/22 (H) AM: DRUMMOND, MCCABE, HANNAN
03/15/22 (H) STA AT 3:00 PM GRUENBERG 120
03/15/22 (H) Heard & Held
03/15/22 (H) MINUTE(STA)
03/22/22 (H) STA AT 3:00 PM GRUENBERG 120
WITNESS REGISTER
LUCINDA MAHONEY, Commissioner
Department of Revenue
Juneau, Alaska
POSITION STATEMENT: Introduced HB 401, on behalf of the House
Rules Standing Committee, sponsor by request of the governor.
ADAM HYKES
Homer, Alaska
POSITION STATEMENT: Testified in opposition to HB 396.
SENATOR DAVID WILSON
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Introduced CSSB 95(STA), as the prime
sponsor.
JASMIN MARTIN, Staff
Senator David Wilson
Juneau, Alaska
POSITION STATEMENT: Presented a sectional analysis of CSSB
95(STA), on behalf of Senator Wilson, prime sponsor.
MARK STIGAR, President
Alaska Search and Rescue Association
Palmer, Alaska
POSITION STATEMENT: Provided invited testimony during the
hearing on CSSB 95(STA).
THOR VUE, Chief Procurement Officer
Department of Administration
Juneau, Alaska
POSITION STATEMENT: Answered questions during the hearing on
CSSB 95(STA).
PAUL FUSSEY, Lt.
Alaska State Troopers
Department of Public Safety
Anchorage, Alaska
POSITION STATEMENT: Answered questions during the hearing on
CSSB 95(STA).
JOHN HARSHFIELD, State Property Manager
Shared Services of Alaska
Department of Administration
POSITION STATEMENT: Answered questions during the hearing on
CSSB 95(STA).
CLAIRE GROSS, Staff
Representative Jonathan Kreiss-Tompkins
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Introduced several amendments, on behalf of
Representative Kreiss-Tomkins, prime sponsor of CSHB 309(CRA).
HEATHER HEBDON, Executive Director
Alaska Public Offices Commission
Anchorage, Alaska
POSITION STATEMENT: Answered questions during the hearing on
CSHB 309(CRA).
ALPHEUS BULLARD, Attorney
Legislative Legal Services
Legislative Affairs Agency
Juneau, Alaska
POSITION STATEMENT: Answered questions during the hearing on
CSHB 309(CRA).
ACTION NARRATIVE
3:07:45 PM
CHAIR JONATHAN KREISS-TOMKINS called the House State Affairs
Standing Committee meeting to order at 3:07 p.m.
Representatives Tarr, Story, Eastman, Vance, Kaufman, Eastman,
and Kreiss-Tomkins were present at the call to order.
Representative Claman (via teleconference) arrived as the
meeting was in progress.
HB 401-NO STATE INVESTMENT IN RUSSIAN FEDERATION
3:08:40 PM
CHAIR KREISS-TOMKINS announced that the first order of business
would be HOUSE BILL NO. 401, "An Act relating to certain
investments of state funds in the Russian Federation and
financial institutions profiteering from the Russian
Federation's invasion of Ukraine; providing indemnity and
immunity for certain investment actions taken in compliance with
law; and providing for an effective date."
3:09:24 PM
LUCINDA MAHONEY, Commissioner, Department of Revenue (DOR),
introduced HB 401, on behalf of the House Rules Standing
Committee, sponsor by request of the governor. She provided a
PowerPoint presentation, titled "HB 401 - Divestment regarding
Russian Entities." She began on slide 3, which read as follows
[original punctuation provided]:
HB 401 Bill Summary
Prohibits investment in and requires divestment of
Russian assets in funds subject to AS 37.10.
Assets include all sovereign debt of the Russian
Federation and publicly traded securities of a company
identified by the United States Department of
Treasury, Office of Foreign Assets (OFAC).
Provides for a 180-day exit from the assets once
identified.
Divestment is not required for comingled funds, but
the fiduciary is required to request that fund
managers consider divestment annually on January 31.
Precludes the Commissioner of Revenue or other
fiduciary from conducting business with banks who are
"profiteering" from the Russian invasion of Ukraine.
COMMISSIONER MAHONEY provided an explanation of the Office of
Foreign Assets (OFAC), U.S. Department of Treasury. She said
OFAC was tasked with identifying Russian institutions close to
President Vladimir Putin that were likely involved in funding
the invasion of Ukraine. She reported that 13 Russian entities
were identified and consequently included in the U.S. sanctions.
She said the goal of the sanctions was to cripple the core
infrastructure of the Russian financial system such that it
would diminish funding for the war.
3:16:58 PM
COMMISSIONER MAHONEY continued to slide 4, which read as follows
[original punctuation provided]:
HB 401 Bill Summary (continued)
May allow investments if not doing so would be
inconsistent with applicable fiduciary
responsibilities but requires at least three
alternative investment opportunities to be considered.
Excludes Alaska Permanent Fund Corporation (APFC) and
the Alaska Retirement Management Board (ARMB),
allowing divestment decisions by these entities'
boards.
Exempts those taking divestment actions or inactions,
in good faith, from liability for doing so.
Provides reporting mechanisms to the Legislature as
to the divestment activity undertaken.
Expires on July 1, 2023.
3:19:58 PM
COMMISSIONER MAHONEY turned to slide 8, which read as follows
[original punctuation provided]:
Treasury Russian Equity Investments 1/31/22
Treasury Russian equity investments 0.23% of $50.6
billion in assets:
State Investments 0.10% of $7.7 billion in assets
0.10% of state assetshad Russian equity exposure on
1/31/22 ($7.4 million).
1 passive/index investment manager.
Defined Benefit Retirement Systems 0.28% of $33.9
billion in assets
0.28% of the retirement funds had Russian equity
exposure on 1/31/22 ($93.5 million).
7 investment managers 4 active, 3 passive/index.
Participant Directed 0.15% of $9.0 billion in assets
0.15% of participant directed assetshad Russian
equity exposure on 1/31/22 ($13.4 million).
4 investment managers 2 managers active, 2
passive/index funds.
All ofthe Russian exposure is through commingled
funds where the ARMB is not the direct fiduciary for
the funds.
Treasury has directed a halt to the purchase of
Russian securities at this time due to illiquidity and
risk uncertainty.
3:21:07 PM
COMMISSIONER MAHONEY concluded on slide 9, which read as follows
[original punctuation provided]:
What are others doing?
States
Research and surveys administered by The Pennsylvania
Treasurershow that as of 3/12/22, there were a total
of 37 states currently looking into or currently
freezing state money or pension funds going to Russian
companies, investments or oligarchs.
Other actions taken by other states include the
following:
Looking into or currently banning state agencies from
doing business with Russian state-owned firms and
subcontractors.
Blocking Russian businesses and nonprofits from
acquiring property in their state for 1 year.
Looking into or ending sister state relationship with
Russia.
Officially condemned Russia's invasion.
Welcoming refugees.
Calling on businesses to ban Russian made goods.
Norway Sovereign Wealth Funds
Norway announced that they are divesting from Russia.
Russian assets at the end of 2021 made up 0.2% of
Norway fund ($3 billion in total).
Recognize that divestment takes time because they
want to ensure sales are not made to sanctioned
individuals/entities.
3:22:15 PM
REPRESENTATIVE EASTMAN asked how profiteering would be defined.
COMMISSIONER MAHONEY shared her understanding that profiteering
would be defined "based on the day that we would be evaluating
this." She expected that the circumstances, evaluations, and
volatility would change constantly. She provided an example.
REPRESENTATIVE EASTMAN asked whether the [Alaska Permanent Fund
Corporation (APFC)] board had a policy against unfair or
excessive profits.
COMMISSIONER MAHONEY answered no.
3:24:38 PM
REPRESENTATIVE STORY inquired about the differences between HB
401 and HB 396.
COMMISSIONER MAHONEY explained that HB 401 excluded APFC and the
Alaska Retirement Management Board (ARMB) and included
provisions for profiteering; additionally, the repeal dates were
different, as well as the divestment timelines. Furthermore, HB
401 would create a new statute, which would need to be repealed
when the issue was resolved, whereas HB 396 was identified as
"uncodified statute in law."
3:27:03 PM
REPRESENTATIVE VANCE asked why the legislation was needed if the
state followed the prudent investor rule and it would be
imprudent to invest in Russian assets for the foreseeable
future.
COMMISSIONER MAHONEY acknowledged that external managers had
been directed not to purchase any new Russian investments;
however, HB 401 pertained to the management of existing
investments. She pointed out that trustees from APFC and ARMB
could have different ideas on what constituted a prudent
investment strategy.
REPRESENTATIVE VANCE sought to confirm that HB 401 was
essentially asking the legislature to decide what was socially
acceptable for state funds.
COMMISSIONER MAHONEY clarified that HB 401 would enable the
Treasury Division, DOR, to make a divestment decision and take
the potentially social component off the table.
REPRESENTATIVE VANCE asked how much the state could stand to
lose by divesting.
COMMISSIONER MAHONEY said there was always the potential that
nothing would be recovered, and the state would lose all of it,
which would be the worst-case scenario. She highlighted the
enormous amount of uncertainty in the current environment.
3:31:15 PM
REPRESENTATIVE TARR asked whether divestment actions were
trending in other states.
COMMISSIONER MAHONEY suspected that the answer was yes, as
Americans tended to be very supportive of Ukraine.
3:33:15 PM
HAIR KREISS-TOMKINS announced that HB 401 was held over.
HB 396-DIVEST INVESTMENTS IN RUSSIAN ENTITIES
3:34:52 PM
CHAIR KREISS-TOMKINS announced that the next order of business
would be HOUSE BILL NO. 396, "An Act restricting certain
investments of state funds in certain Russian entities; and
providing for an effective date."
CHAIR KREISS-TOMKINS opened public testimony.
3:35:23 PM
ADAM HYKES, said, as an investor in the Alaska Permanent Fund,
he had a huge problem with forcing a divestment policy that he
would not otherwise support. He opined that Ukraine was a "hot
button issue," further speculating that the bill was hastily
thrown together. He expressed his opposition to the practice of
placing economic sanctions on another nation. He reiterated his
opposition to HB 396.
3:38:24 PM
CHAIR KREISS-TOMKINS closed public testimony on HB 396 and
announced that the bill was held over.
SB 95-SEARCH AND RESCUE SURPLUS STATE PROPERTY
3:39:21 PM
CHAIR KREISS-TOMKINS announced that the next order of business
would be CS FOR SENATE BILL NO. 95(STA), "An Act relating to the
right of first refusal of a volunteer search and rescue group
with respect to obsolete or surplus state property."
3:39:42 PM
SENATOR DAVID WILSON, Alaska State Legislature, prime sponsor,
introduced CSSB 95(STA). He paraphrased the sponsor statement,
which read as follows [original punctuation provided]:
Search and rescue operations across the State of
Alaska are largely done by volunteer organizations
dispatched by the Alaska State Troopers. These groups
provide lifesaving services to our state at minimal
cost. SB 95 provides assistance to the groups at no
cost to the state. While search and rescue groups can
be reimbursed for costs incurred during specific
operations, the state does not generally provide them
with equipment.
This legislation allows a volunteer search and rescue
organization to exercise the right of first refusal on
items related to search and rescue before the property
is sold, leased, licenses, or disposed of. Right of
first refusal means the organization can buy the
equipment at a fair market value set by the department
of administration. This bill enables these volunteer
search and rescue groups to more easily obtain the
equipment they need to fulfill their lifesaving
mission.
Thank you for your consideration of this important
legislation.
3:42:22 PM
JASMIN MARTIN, Staff, Senator David Wilson, on behalf of Senator
Wilson, prime sponsor, summarized the intent of the bill and
presented a sectional analysis of CSSB 95(STA) [included in the
committee packet], which read as follows [original punctuation
provided]:
Section 1: Names this act the Ellie Mae Act.
Section 2: Amends AS 44.68.110 to allow an organized
volunteer search and rescue group to exercise right of
first refusal for surplus state items related to
search and rescue before they are disposed of by the
state.
3:44:11 PM
MARK STIGAR, President, Alaska Search and Rescue Association,
explained that the goal of the legislation was to allow the
volunteer search and rescue groups to fulfill their purpose as
easily as possible by making equipment available to them. He
explained that the groups were made up of volunteers and relied
entirely on fundraising, as they didn't receive any money from
state entities.
REPRESENTATIVE VANCE asked how these groups were defined in
statute and whether they were required to meet certain criteria
so that they weren't receiving an unfair advantage over other
groups.
MR. STIGAR shared his understanding that the search and rescue
operations groups were identified by a resource list maintained
by the Alaska State Troopers (AST).
SENATOR WILSON directed attention to page 1, lines 8-10, which
defined the groups as "A group of volunteers that is organized
to provide search and rescue services in the state, including
participation in a search and rescue party under AS 18.60.120".
3:49:08 PM
REPRESENTATIVE KAUFMAN wondered whether procurement items could
be influenced by those receiving the first option to refuse.
MS. MARTIN assured Representative Kaufman that state property
was disposed of by the Department of Administration (DOA) in the
best interest of the state; further that the responsibility was
taken very seriously.
3:50:16 PM
CHAIR KREISS-TOMKINS asked how common it was for personal
property to be used to execute the missions carried out by the
search and rescue organizations.
MS. MARTIN deferred to Mr. Stigar.
MR. STIGAR estimated that at least 90 percent of the property
was personal property. For example, he said all of the 25
search and rescue canines were "personal property" of their
handlers. He said the exception was a small number of radios
provided by the state.
CHAIR KREISS-TOMKINS asked how DOA would interpret the language
on page 1, line 8.
3:53:11 PM
THOR VUE, Chief Procurement Officer, DOA, attempted to clarify
the question.
CHAIR KREISS-TOMKINS asked how to determine which entities were
eligible and which individuals in said entities were eligible.
MR. VUE explained that DOA worked closely with the Department of
Public Safety (DPS) to ensure that the organizations were
recognized. In regard to individual eligibility, he imagined
that officers within the eligible entities would be selected as
the organizations' representatives.
CHAIR KREISS-TOMKINS asked how DPS would assess which entities
were eligible, should the legislation pass.
3:55:12 PM
PAUL FUSSEY, Lt., Alaska State Troopers, DPS, stated that he
would work closely with Mr. Vue to establish the appropriate
qualifications.
3:55:54 PM
REPRESENTATIVE EASTMAN asked whether loans should be added to
the list on page 1, line 12, of the bill.
MS. MARTIN pointed out that "leased" was included in the list,
which could capture the intent described by Representative
Eastman. She recalled a discussion that took place in the
Senate Finance Committee about making this a leasing program;
however, the property in question would be past its valuable
life, so keeping it as inventory would no longer benefit the
state.
REPRESENTATIVE EASTMAN asked whether it was the bill sponsor's
intent for a volunteer group to have priority over a borough
search and rescue team.
MS. MARTIN answered yes, the bill would apply to volunteer
organizations. She reasoned that organizations with a payroll
have more resources and wouldn't necessarily need to purchase
state equipment at a reduced cost.
3:58:51 PM
REPRESENTATIVE STORY asked how big the surplus [of equipment]
was and whether other groups should be included in the scope of
the bill.
SENATOR WILSON opined that the bill would be a "nominal" way for
the state to assist search and rescue groups at zero cost. He
said his intent was to help search and rescue groups across
Alaska that were in need of goods and services, which the state
would typically donate.
REPRESENTATIVE STORY requested a response from DOA.
4:01:05 PM
JOHN HARSHFIELD, State Property Manager, Shared Services of
Alaska, DOA, reported that between 30-50 items were posted per
day. The auction averaged 300 items at any given point, he
said.
4:02:34 PM
REPRESENTATIVE EASTMAN directed attention to the language "state
property that may assist in carrying out search and rescue
services". He asked who was being granted the authority to make
that determination.
MS. MARTIN said DOA would be empowered to make that
determination. She reiterated that the department was required,
by statute, to dispose of equipment in the best interest of the
state.
REPRESENTATIVE EASTMAN posed a scenario in which multiple search
and rescue groups were interested in the same item. He asked
how that would be handled.
MS. MARTIN shared her understanding that it would be resolved
with a bidding procedure.
CHAIR KREISS-TOMKINS expressed his interested in hearing a
response from DOA; additionally, he inquired about the process
by which property was currently disposed of.
4:04:39 PM
MR. HARSHFIELD said currently, the state used www.govdeals.com
to source out its auction items. He explained that the website
had the capability to create multiple tiers of bidders, which
included a public tier and a tier for state employees. He said
if the bill were to pass, an additional tier would be created
for search and rescue groups.
CHAIR KREISS-TOMKINS sought to confirm that state employees had
the right to first refusal and could effectively flag interest
in an item, which in turn, would remove it from the public
bidding process.
MR. HARSHFIELD clarified that the item would be moved to the
state employee tier, wherein the item could be pulled for state
use only.
CHAIR KREISS-TOMKINS asked how the right of first refusal
functioned with the multi-tier system described by Mr.
Harshfield. He considered a scenario in which a surplus DPS
airplane was up for auction and asked whether any bid
constituted the right of first refusal.
MR. HARSHFIELD answered yes, the winning bidder on the tier
would obtain the property. He explained that any item in the
search and rescue tier would not be available to the public.
CHAIR KREISS-TOMKINS sought to confirm that any single bid would
effectively block an item from advancing to the public tier.
MR. HARSHFIELD confirmed.
4:08:10 PM
MS. MARTIN added that DOA had mentioned a "buy it now" price or
a minimum bid for a scenario in which multiple search and rescue
groups were not bidding on the same item.
CHAIR KREISS-TOMKINS asked how a minimum bid or a "buy it now"
price would work.
MR. HARSHFIELD explained that DPS would set an estimate on the
price of an item before it was sent to the surplus program. The
surplus program would then list the item for search and rescue
groups to purchase at that set price.
4:09:18 PM
MR. HARSHFIELD, in response to a question from Representative
Eastman, stated that set prices would be a rarity and something
that would require further discussion.
CHAIR KREISS-TOMKINS asked how common it was for a minimum bid
to be exceeded in an auction scenario.
MR. HARSHFIELD said most items with a set price sold well above
the set price. He noted that typically, set prices were
reserved for higher value items to accrue more money for the
state.
CHAIR KREISS-TOMKINS asked how much revenue DOA grossed in a
fiscal year through the surplus property program.
MR. HARSHFIELD said DOA grossed zero, as all the income from the
program went straight to the general fund (GF).
CHAIR KREISS-TOMKINS asked for the gross figure from sales.
MR. HARSHFIELD answered slightly over $260,000 in 2021. He
noted that the figure excluded vehicles and heavy equipment,
which were sold through DOT&PF.
CHAIR KREISS-TOMKINS asked Mr. Harshfiled to follow up with the
total sales for vehicles and heavy equipment.
4:12:01 PM
REPRESENTATIVE VANCE asked why the act was referred to as the
Ellie Mae Act.
SENATOR WILSON said he wanted to honor a service [indisc.] that
passed away.
4:12:23 PM
REPRESENTATIVE TARR asked whether in general, the surplus
property program secured an appropriate price for the items'
real value.
MR. HARTFIELD estimated that most auction items brought in 5-15
percent of their original value.
SENATOR WILSON pointed out that the items were originally
purchased for state use. He said the intent was for the items
to remain in state service for the remainder of their useful
life.
CHAIR KREISS-TOMKINS remarked, "How do you assess the
potentially expanding the class of volunteers in communities
who might benefit from state surplus equipment?"
4:16:38 PM
SENATOR WILSON clarified that the equipment in question would go
to organizations - not individuals.
CHAIR KREISS-TOMKINS asked how the program would work for an
informally organized group, such as [the search and rescue
group] in Cake, Alaska, which lacked a tax status and bank
account.
MS. MARTIN said the groups must be organized to access the DOA
portal. She believed that the term "organized" would best
capture the search and rescue groups in Alaska without being
overly prescriptive.
CHAIR KREISS-TOMKINS announced that CSSB 95(STA) was held over.
HB 309-APOC; CAMPAIGN CONTRIBUTIONS/REPORTING
4:19:07 PM
CHAIR KREISS-TOMKINS announced that the final order of business
would be HOUSE BILL NO. 309, "An Act exempting candidates for
municipal office and municipal office holders in municipalities
with a population of 15,000 or less from financial or business
interest reporting requirements; relating to campaign finance
reporting by certain groups; and providing for an effective
date." [[Before the committee was CSHB 309(CRA).]
CHAIR KREISS-TOMKINS moved to adopt Amendment 1, [labeled 32-
LS0540\W.2, Bullard, 3/19/22], which read:
Page 6, line 20:
Delete "January 1, 2023"
Insert "July 1, 2022"
REPRESENTATIVE EASTMAN objected for the purpose of discussion.
4:20:26 PM
CLAIRE GROSS, Staff, Representative Jonathan Kreiss-Tompkins,
Alaska State Legislature, explained that Amendment 1 would
change the effective date from January 1, 2023, to July 1, 2022.
REPRESENTATIVE EASTMAN asked why this change was needed.
MS. GROSS said after speaking with the Alaska Public Offices
Commission (APOC), moving the effective date to July 1 would
alleviate unnecessary candidate POFD statements for the 2022
October elections for the 25 municipalities below 25,000.
4:21:26 PM
REPRESENTATIVE VANCE asked APOC to comment on the effective date
change.
4:21:49 PM
HEATHER HEBDON, Executive Director, APOC, shared her
understanding that Amendment 1 would still allow sufficient time
for APOC to coordinate with the clerks in the 25 municipalities
that would be impacted.
REPRESENTATIVE EASTMAN withdrew his objection. There being no
further objection, Amendment 1 was adopted.
4:22:30 PM
CHAIR KREISS-TOMKINS moved to adopt Amendment 2, [labeled 32-
LS0540\W.3, Bullard, 3/21/22], which read:
Page 1, line 3, following "groups;":
Insert "relating to the filing of public official
financial disclosure reports by municipalities;"
Page 6, following line 12:
Insert a new bill section to read:
"* Sec. 9. AS 39.50.145 is amended by adding a new
subsection to read:
(b) Notwithstanding an exemption elected under
(a) of this section, a municipality may file with the
commission public official financial disclosure
reports for its municipal officers and candidates for
elective municipal office. The commission shall
maintain a report filed under this subsection as a
public record while kept on file, but a person for
whom a report is filed under this subsection is not
subject to the requirements of AS 39.50.060,
39.50.070, or 39.50.135. In this subsection,
"municipal officer" includes a borough or city mayor,
borough assemblyman, city councilman, school board
member, elected utility board member, city or borough
manager, or member of a city or borough planning or
zoning commission within a home rule or general law
city or borough or a unified municipality."
Renumber the following bill sections accordingly.
REPRESENTATIVE EASTMAN objected for the purpose of discussion.
4:22:39 PM
MS. GROSS said Amendment 2 would provide an affirmative
statement that nothing would stop the municipalities from using
APOC's existing system for filing disclosures.
REPRESENTATIVE EASTMAN sought to confirm that the language
pertained to a municipality filing a disclosure on behalf of an
individual, as opposed to an individual filing his/her own
disclosure.
MS. GROSS clarified that the intent was for the language to
pertain to candidates and public officials from municipalities.
REPRESENTATIVE EASTMAN suggested that the language be amended
for clarity.
CHAIR KREISS-TOMKINS asked to hear from Mr. Bullard first. He
asked how the language "a municipality" on lines 8-9 of
Amendment 2 related to individual candidates filing a POFD with
APOC.
4:24:49 PM
ALPHEUS BULLARD, Attorney, Legislative Legal Services,
Legislative Affairs Agency, clarified that Amendment 2 did not
pertain to individual candidates and municipal officials.
Instead, he said, the proposed amendment was addressed to
municipalities. He was unsure whether individual candidates or
municipal officials could submit a POFD under this provision, as
it was directed at municipalities.
CHAIR KREISS-TOMKINS welcomed a conceptual amendment from
Representative Eastman.
4:25:31 PM
REPRESENTATIVE EASTMAN proposed Conceptual Amendment 1 to
Amendment 2, such that "a municipality" on line 9 was deleted
and replaced with "an individual".
CHAIR KREISS-TOMKINS asked for Ms. Hebdon to comment on
Conceptual Amendment 1.
4:25:59 PM
MS. HEBDON opined that the intent would be clearer if "a
municipality" was replaced with "a municipal officer" or "a
municipal candidate".
REPRESENTATIVE VANCE sought to clarify whether the sponsor's
intent was for the amendment to allow municipalities "to make
that judgment to require candidates and officers to file with
the commission" versus giving direction to an individual. She
sought to confirm that the amendment would effectively allow
municipalities to continue to participate in the existing APOC
requirement.
CHAIR KREISS-TOMKINS answered yes and withdrew Amendment 2. He
moved to adopt Amendment 3, labeled [32-LS0540\W.5, Bullard,
3/21/22], which read:
Page 1, line 3, following "groups;":
Insert "requiring online disclosure of public
officials' financial and business interest reports;"
Page 6, following line 1:
Insert a new bill section to read:
"* Sec. 8. AS 39.50.050 is amended by adding a new
subsection to read:
(e) The commission shall post each record filed
under this chapter so that the record may be viewed on
the commission's Internet website for as long as the
commission keeps the record on file."
Renumber the following bill sections accordingly.
REPRESENTATIVE EASTMAN objected.
4:27:28 PM
MS. GROSS explained that Amendment 5 would require all submitted
POFDs to be viewable online.
REPRESENTATIVE EASTMAN agreed with that sentiment.
CHAIR KREISS-TOMKINS questioned the purpose of POFDs and
wondered whether their statutory intent was fulfilled if POFDs
were being dutifully submitted and never accessed thereafter.
He opined that Amendment 3 encapsulated the intent of POFDs,
characterizing its potential impact as "more of a splash of cold
water to a lot of people who currently file POFDs every year."
4:28:56 PM
REPRESENTATIVE EASTMAN expressed his concern that the language
"on file" on line 10 of Amendment 3 was ambiguous. He suggested
deleting that verbiage to add clarity. Additionally, he
expressed concern about the impact of the provision should it be
retroactive and suggested that old POFD filers be allowed to opt
out for a period of time if they so choose.
CHAIR KREISS-TOMKINS clarified that his intent was not for the
amendment to have a retroactive effect.
4:30:42 PM
REPRESENTATIVE VANCE questioned how the amendment would change
things moving forward.
MS. HEBDON conveyed that typically, statements published through
APOC's website were not purged at any time. She noted that the
commission was statutorily required to maintain [the records]
for at least six years. She explained that part of the tension
revolved around the municipal clerks being the official record
holders for municipal filing.
CHAIR KREISS-TOMKINS asked where the six-year requirement
originated.
MS. HEBDON cited AS 39.50.050(b).
CHAIR KREISS-TOMKINS sought to confirm that APOC was required to
keep these records on file for at least six years; however, the
current practice was to keep POFDs published on APOCs website
forever.
MS. HEBDON answered yes.
4:33:22 PM
REPRESENTATIVE TARR attempted to clarify which category of POFDs
were not available online and whether Amendment 3 would change
that. Additionally, she questioned whether there should be a
timeframe for removing POFDs from APOC's website.
MS. HEBDON reported that the only POFDs published on APOC's
website were candidates for state and municipal offices; the
governor and lieutenant governor; and legislative financial
statements for seated and past legislators. She reiterated that
the remainder of POFDs were available to the public but not
published on APOC's website.
CHAIR KREISS-TOMKINS listed municipal elected officials; heads
of departments and their deputies; division heads; deputy
directors of divisions; special assistants to the heads of state
agencies; judicial officers; and members of boards and
commissions as the remaining individuals who submit the POFDs
that were not published on APOC's website.
MS. HEBDON clarified that the POFDs submitted by the individuals
in that list were not necessarily paper files. She explained
that many were required to file their POFDs electronically,
which allowed APOC to file them in its system without publishing
them on the website. She indicated that only municipal officers
and candidates in communities of 15,000 or less were filing
paper statements.
4:37:02 PM
REPRESENTATIVE KAUFMAN asked for the bill sponsor's thoughts on
Amendment 1, which accelerated the effective date, given the
magnitude of Amendment 3.
CHAIR KREISS-TOMKINS said he felt good about it in consultation
with APOC. Nonetheless, he suggested that POFDs should
potentially expire from public view after a certain amount of
time. He pointed out that if Amendment 3 were to pass, every
person who filed a POFD electronically would have their
mortgage, stocks, and income viewable online. He urged the
committee to consider that factor.
4:38:42 PM
REPRESENTATIVE EASTMAN expressed concern that posting POFDs
online was excessive. He suggested limiting the viewership to
IP addresses from Alaska.
CHAIR KREISS-TOMKINS said Representative Eastman had highlighted
the tension between public disclosure and reasonable privacy.
He added that he was sensitive to that tension and reiterated
his interest in being intentional about the scope of the POFD
requirement. He opined that the idea involving Alaskan IP
addresses was compelling and asked Ms. Hebdon to comment.
MS. HEBDN declined to comment on the logistics of accomplishing
that proposal.
4:41:14 PM
REPRESENTATIVE EASTMAN suggested that access could be limited to
anyone with a myAlaska account and asked whether that kind of
restriction was possible.
MS. HEBDON was unsure of the answer. She said it was not
something that APOC had considered.
4:42:27 PM
REPRESENTATIVE KAUFMAN remarked:
If the intent is to show that there might be a
conflict of interest with holdings in the POFD
reports, what is the benefit of reporting that if the
holding is a very small percentage.
MS. HEBDON said the legislature had decided that a holding of
$1,000 or more might pose a significant conflict of interest.
She reiterated that the threshold was a legislative directive
and therefore a policy call.
4:43:31 PM
REPRESENTATIVE EASTMAN said the requirement to disclose
customers was a repeated concern raised by [constituents]. He
shared several personal anecdotes.
REPRESENTATIVE VANCE, regarding Amendment 3, said she liked the
idea of transparency; however, she questioned whether there were
any legal concerns about the constitutional right to privacy,
adding that she wouldn't want a disclosure requirement to
discourage volunteers.
CHAIR KREISS-TOMKINS speculated that any legal concerns would
have been raised when the POFD statutes were initially passed.
He believed that Representative Vance's question was more to who
should be filing POFDs.
REPRESENTATIVE VANCE asked who aside from the public would
utilize this information.
CHAIR KREISS-TOMKINS pointed out that the POFD process only
occurred once an individual was selected to a board or
commission. He opined that it wouldn't make sense for all the
members of boards and commissions in Alaska to file POFDs if
they were to be published online; alternatively, he argued that
the legislature should save them the hassle of filing if their
POFDs were to remain offline tucked away in an electric file.
He opined that the POFD filer requirements should be scaled back
pending further conversations.
REPRESENTATIVE EASTMAN agreed.
4:49:06 PM
REPRESENTATIVE CLAMAN responded to the suggestion to limit
online POFD access to those with an Alaska IP address or
myAlaska account. He opined that unintentionally excluding
members of the press could be a dangerous implication.
CHAIR KREISS-TOMKINS asked whether Ms. Hebdon had any concern
about the words "on file" on line 10 of Amendment 3.
MS. HEBDON said if the amendment were to pass, APOC would have
to take a more detailed look at how files were maintained.
CHAIR KREISS-TOMKINS opined that the expiration of viewability
was an important question for the committee to address. He
withdrew Amendment 3, noting that the idea could be better
incorporated in a potential forthcoming committee substitute
(CS).
4:51:57 PM
REPRESENTATIVE TARR expressed her desire to prioritize public
disclosure for elected officials specifically.
CHAIR KREISS-TOMKINS agreed.
4:52:39 PM
REPRESENTATIVE VANCE moved to adopt Amendment 4, [labeled 32-
LS0540\W.7, Bullard, 3/21/22], which read:
Page 1, line 3, following "certain":
Insert "candidates and"
Page 2, line 11, following "year":
Insert ";
(3) candidate or group, if the candidate or
group
(A) indicates, on a form prescribed by the
commission, an intent not to raise and not to expend
more than $3,000 in a calendar year in a municipal
election in a municipality with a population of 15,000
or less;
(B) accepts contributions totaling not more
than $3,000 in a calendar year for the purposes of
influencing the outcome of a municipal election in a
municipality with a population of 15,000 or less; and
(C) makes expenditures totaling not more
than $3,000 in a calendar year for the purposes of
influencing the outcome of a municipal election in a
municipality with a population of 15,000 or less"
Page 2, line 30, following "(C)":
Insert "is"
Page 3, line 5:
Delete "(g)(2)"
Insert "(g)(2) or (3)"
REPRESENTATIVE EASTMAN objected for the purpose of discussion.
4:52:46 PM
REPRESENTATIVE VANCE explained that Amendment 4 would exempt
groups that expended under $3,000 annually from filing with the
commission.
REPRESENTATIVE EASTMAN suggested making it a unanimous $5,000
for candidates and groups alike.
REPRESENTATIVE VANCE explained that her intent was to make
candidates and groups accountable to the same amount; however,
she believed that $3,000 fair, as it was a compromise between
the $2,500 reporting requirement for individuals and the $5,000
reporting requirement for groups.
CHAIR KREISS-TOMKINS suggested incorporating the idea into a CS.
He asked if that would be amenable.
REPRESENTATIVE VANCE agreed.
4:58:17 PM
REPRESENTATIVE VANCE withdrew Amendment 4.
5:01:13 PM
CHAIR KREISS-TOMKINS announced that HB 309(CRA) was held over.
5:01:43 PM
ADJOURNMENT
There being no further business before the committee, the House
State Affairs Standing Committee meeting was adjourned at 5:01
p.m.