Legislature(2023 - 2024)BUTROVICH 205
03/22/2024 01:30 PM Senate JUDICIARY
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| Audio | Topic |
|---|---|
| Start | |
| SB165 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 165 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 165-DEFENSE OF PUB. OFFICER: ETHICS COMPLAINT
1:31:31 PM
CHAIR CLAMAN announced the consideration of SENATE BILL NO. 165
"An Act relating to legal representation of public officers in
ethics complaints."
CHAIR CLAMAN said this is the second hearing of this bill in the
Senate Judiciary Committee. The intention is to hear invited
testimony from former Attorney General Jahna Lindemuth.
1:32:20 PM
JAHNA LINDEMUTH, representing self, Anchorage, Alaska, testified
by invitation as a former attorney general in support of SB 165.
She stated that she served as attorney general (AG) under former
Governor Bill Walker from August 2016 to December 2018. She
offered her testimony, which is paraphrased below:
I fully support the passage of SB 165. The Department
of Law (DOL) regulations that took effect in November
2023 are inconsistent with the Executive Ethics Act
and the Alaska Constitution. Rather than resolving
this issue in the courts, the legislature should
clarify that the Attorney General's Office may not
defend either the attorney or the governor, and that
they should be treated as any other state employee who
may ask for reimbursement of fees if exonerated from
an Ethics Act complaint by adopting this bill. This is
consistent with the attorney generals opinion issued
by then Attorney General Dan Sullivan, now a U.S.
Senator, on August 5, 2009.
In a nutshell, the Executive Ethics Act prohibits
using one's position for personal gain, per
AS 39.52.120(a); using state resources for personal
interest, per AS 39.52.120(a)(3); or taking action in
a matter where the officer has a personal interest,
per AS 39.52.120(a)(4).
1:33:32 PM
MS. LINDEMUTH continued testifying:
The attorney general is the state officer charged with
ensuring compliance with the Executive Ethics Act.
• The attorney general issues advisory opinions to
state employees under AS 39.52.240.
• The designated ethics supervisors throughout the
state submit quarterly reports to the attorney
general under section AS 39.52.260.
• The attorney general is the primary prosecutor for
any ethics violations:
• The attorney general can initiate a complaint
based on information in the quarterly report or
otherwise known to the attorney general under
subsection AS 39.52.310(a).
• Citizens may file complaints directly with the
attorney general under subsection AS
39.52.310(b).
• If a hearing is required, the attorney general is
a party and presents charges and has the burden
of proving the charges by a preponderance of the
evidence under AS 39.52.360(c).
• The only instance where the attorney general (AG) is
not the prosecutor is where the allegation is
against the AG himself or against the Governor, the
AG's boss who can remove the AG without cause. In
that instance, the Personnel Board will hire
independent counsel to serve in the AG's usual role
because the law recognizes that the attorney general
has a conflict of interest.
1:34:47 PM
MS. LINDEMUTH continued testifying:
This conflict of interest precluding the AG from
prosecuting the attorney general or the governor does
not mean and should not mean that the Attorney
General's Office is then free to defend the attorney
general or the governor, for reasons such as:
1. There is inherent conflict with the attorney
general's primary role as the main enforcer of the
Executive Ethics Act.
• As noted by the 2009 Sullivan Opinion, footnote
46, such a situation could result in the
Department of Law arguing a provision of the Act
is unconstitutional or should be more narrowly
construed than the AG had previously asserted in
other proceedings.
• It could even happen that a complaint is filed
against the attorney general or the governor and
one or more subordinates. Thus, the AG could be
prosecuting someone in the Governor's Office, for
example, while the Department of Law is defending
the governor on the same allegation.
1:35:39 PM
MS. LINDEMUTH continued testifying:
2. More importantly, the regulations authorizing the
Department to defend the attorney general and the
governor are inconsistent with the overall role of
the AG. The AG is the attorney for the whole state,
not any one officer, even the governor himself, and
the AG acts through all the assistant attorney
generals working under him or her. Stated another
way, neither the AG nor any other attorney at the
Department of Law can serve as the personal attorney
for any state employee.
In response, the AG may point out that the Attorney
General's Office regularly defends state employees in
court cases. But when defending a tort claim, say,
against a commissioner or corrections officer, the
Department is defending the actions of that state
employee taken within the scope of his or her state
employment. That is not usually at issue.
Ethics Act cases are different because the nature of
the claim is that the state employee, the governor, or
the attorney general used his or her position for
personal gain or used state resources for a personal
interest.
The irony here is that the regulations passed by the
Attorney General's Office sanctions further additional
state assets being used for the attorney general or
governor's personal interest if the allegations are
indeed true.
1:37:00 PM
MS. LINDEMUTH continued testifying:
3. Which brings me to the final and third point. The
November regulations are inconsistent with only
using public monies for a public purpose, as
required by our constitution.
I want to point out that most ethics complaints do not
make it out of the gate and are summarily dismissed.
Alaska Statute 39.52.310(d) allows the AG to dismiss
claims before an investigation if the allegations are
not facially sufficient to make out a complaint.
Even when not summarily dismissed, most complaints
never advance to a formal complaint stage. Only those
complaints where there is probable cause may proceed,
per AS 39.52.320, which states: If, after
investigation, it appears there is no probable cause
to believe a violation of this chapter has occurred,
the attorney general shall dismiss the complaint.
If there is a probable cause to find that either the
governor or the attorney general violated the
Executive Ethics Act by using state resources for
personal benefit, there is simply no public purpose to
then use state resources to defend that claim. Just
like every other state employee, the attorney general
and the governor should have to personally defend, and
seek reimbursement if exonerated.
1:38:11 PM
MS. LINDEMUTH continued testifying:
Stated another way, if they are indeed guilty, by
definition the fees are not for a public purpose as
required by art. IX, sec. 6, Constitution of the State
of Alaska.
The regulations purport to require the AG to certify
that defending the governor is in the public interest
and require the governor to certify that defending the
AG is in the public interest, but in making such
certifications both have a conflict of interest, and
not simply because they are both the direct
beneficiaries of these regulations.
Given that the AG serves at the pleasure of the
governor and is his subordinate, the AG does not have
the neutrality to make this determination and is
conflicted. There are also no side boards in the
regulations as to what constitutes a public purpose. I
expect the AG would take the position that defense of
any allegation against the AG or governor satisfies
this test, regardless of the merits of the allegation.
I also point the committee's attention to corporate
law as an analogy to when payment of a defense should
be allowed. AS 10.06.490 allows a corporation to
indemnify, in other words, pay back, the attorney's
fees a corporate officer incurs in defending claims if
that officer acted in good faith and in the best
interests of the corporation. However, by law, a
corporation cannot reimburse if a person has been
adjudged liable for negligence or misconduct in the
performance of corporate duties, unless a court finds
that indemnification is fair and reasonable to the
corporation itself, per section .490.
1:39:50 PM
MS. LINDEMUTH continued testifying:
This corporate standard for reimbursement is
consistent with Attorney General Sullivan's 2009
opinion, which remains good law if SB 165 is enacted
and the regulations are negated. That opinion outlines
a four-part test required for indemnification:
(1) The public officer is exonerated.
(2) The public officer acted within the scope of state
employment.
(3) The fees are reasonable.
(4) There is a source of public funds available, in
other words, an appropriation.
Here, because the regulations authorize the Department
to defend the AG and the governor regardless of the
merit or outcome of the complaint, and in the face of
a probable cause finding, the current regulations
allow the state to illegally spend state resources on
the defense even if the governor or AG actually
violated the Executive Ethics Act. SB 165 is needed to
cure this, and I urge that it be passed.
1:40:58 PM
CHAIR CLAMAN invited committee members to ask questions.
CHAIR CLAMAN thanked Ms. Lindemuth for her testimony. He asked
her to email her testimony if it was already in a written
format.
MS. LINDEMUTH responded that she would do that.
1:41:21 PM
CHAIR CLAMAN revisited a question raised at a prior hearing
regarding whether legislators can be reimbursed for legal
expenses. He stated that he had inquired with the Select
Committee on Legislative Ethics, which informed him that there
is no specific provision in law allowing for the reimbursement
of a legislator for proceedings before the committee.
CHAIR CLAMAN noted that this silence suggests there may be some
opportunity for a legislator to apply to Legislative Council to
reimburse those fees. He expressed his belief that during his
time on Legislative Council, requests for the reimbursement of
legal fees or other expenses were denied. He does not believe
there are any legal provisions to reimburse legislators or their
legal fees. He does not think that it is exclusively prohibited,
but the odds of getting reimbursed are fairly low.
1:42:43 PM
SENATOR GIESSEL expressed her understanding that the Ethics Act
was previously unclear, and consequently, a regulation was
written which permitted DOL to defend or advise the governor,
lieutenant governor, and other public officers. She sought
confirmation that SB 165 clarifies that the Department of Law
may not represent those public officials.
1:43:25 PM
CHAIR CLAMAN replied that is correct. He believes Ms. Lindemuth
would agree that existing law aligns with the Sullivan
memorandum, which does not support the regulations adopted in
the fall by the current AG. There is an argument that the
regulations themselves are illegal. He stated that the passage
of SB 165 would resolve any doubt.
1:43:55 PM
SENATOR KAUFMAN joined the meeting.
1:44:04 PM
CHAIR CLAMAN deferred to Ms. Lindemuth.
MS. LINDEMUTH replied that is consistent with her testimony. She
stated her belief that the regulations adopted in the fall are
inconsistent with statute and are not authorized by it. While
the AG expressed his belief that the regulations are consistent
with statute, she disagrees. She said that SB 165 would clarify
the law and clarify that DOL may not defend the attorney general
or the governor.
1:44:39 PM
SENATOR GIESSEL asked about the statutory language that served
as the basis for writing the regulation.
1:44:53 PM
CHAIR CLAMAN deferred to Ms. Lindemuth to comment on what the
current statute provides.
CHAIR CLAMAN said this version of SB 165 originated from related
legislation that was introduced in the House during his tenure
in that body. After committee debate, discussion, and research,
it was concluded that no more needed to be said. The tendency is
to add multiple layers, but it is unnecessary. SB 165 just needs
to state that it is not permitted.
1:45:37 PM
MS. LINDEMUTH expressed her belief that there is no language in
current statute that allows these regulations to have been
passed.
1:45:53 PM
SENATOR GIESSEL sought confirmation that no statute assigns the
Department of Law, or by extension, the attorney general, a role
in defending ethics complaints.
CHAIR CLAMAN replied, correct.
SENATOR GIESSEL sought confirmation that SB 165 fills a void.
CHAIR CLAMAN replied, yes and sought agreement from counsel.
1:46:42 PM
MS. LINDEMUTH concurred. She stated that, as outlined in her
testimony, the statute designates the attorney general as the
primary prosecutor under the Executive Ethics Act and does not
authorize the attorney general to provide a defense of any
Ethics Act complaint.
1:47:14 PM
SENATOR GIESSEL asked why former Attorney General Sullivan wrote
the analysis issued on August 5, 2009.
CHAIR CLAMAN expressed his understanding that there were similar
discussions during the former AG's tenure, specifically
questioning whether the Department of Law could represent the
governor in ethics complaints. He stated his belief that, prior
to that time, there were no provisions for reimbursing legal
fees related to Ethics Act complaints.
CHAIR CLAMAN expressed his belief that the same questions asked
today were raised then, and the conclusion reflected in the
August 5, 2009 memo was that the attorney general cannot
represent the governor. However, the state could reimburse those
fees if the governor hired counsel and prevailed.
CHAIR CLAMAN expressed his belief that the former AG issued the
memo in response to a wave of ethics complaints filed against
then-Governor Sarah Palin, which raised concerns over mounting
legal expenses. He believes the memorandum was the former AG's
resolution to those issues.
1:48:47 PM
SENATOR GIESSEL sought confirmation that the issue was never
fully clarified and now, approximately 15 years later, the
legislature is attempting to resolve it through statute.
1:49:04 PM
CHAIR CLAMAN offered historical context, recounting the current
administration's efforts to allow the AG to represent the
governor on ethics matters. He stated objections were raised,
legislation was introduced, and while that legislation was
pending, the AG withdrew the regulations. As a result, the
legislature did not proceed with its legislation. The state
continued to operate under the framework established by the 2009
Sullivan memorandum. In the fall, the current AG introduced a
different version of the same concept.
1:50:02 PM
SENATOR GIESSEL remarked, that was super helpful.
1:50:15 PM
At ease.
1:50:52 PM
CHAIR CLAMAN reconvened the meeting.
CHAIR CLAMAN held SB 165 in committee.
1:51:19 PM
There being no further business to come before the committee,
Chair Claman adjourned the Senate Judiciary Standing Committee
meeting at 1:51 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 165 Letter of Support - Alaska Public Interest Research Group 2.28.2024.pdf |
SJUD 3/22/2024 1:30:00 PM |
SB 165 |
| SB 165 Supporting Testimony - Jahna Lindemuth 3.22.2024.pdf |
SJUD 3/22/2024 1:30:00 PM |
SB 165 |