03/05/2024 03:30 PM Senate STATE AFFAIRS

                 SB 246-LEGISLATORS LEGAL FUND                                                                              
                                                                                                                                
4:41:33 PM                                                                                                                    
CHAIR  KAWASAKI announced  the consideration  of SENATE  BILL NO.                                                               
246 "An  Act relating to  a legal fund  to pay attorney  fees and                                                               
costs  in an  election contest;  and providing  for an  effective                                                               
date."                                                                                                                          
                                                                                                                                
[SB 246, version S, is SB 246, version A.]                                                                                      
                                                                                                                                
4:42:01 PM                                                                                                                    
SENATOR  DAVID  WILSON,  District N,  Alaska  State  Legislature,                                                               
Juneau, Alaska, paraphrased the sponsor statement for SB 246:                                                                   
                                                                                                                                
[Original punctuation provided.]                                                                                                
                                                                                                                                
                       Sponsor Statement                                                                                      
                      Senate Bill 246 v. S                                                                                    
                                                                                                                              
     "An Act relating to a legal fund to pay attorney fees                                                                    
     and costs in an election contest; and providing for an                                                                   
                        effective date."                                                                                      
                                                                                                                              
          Currently,  there   is  no  clear   mechanism  for                                                                    
     legislators  to cover  legal  expenses  incurred by  an                                                                    
     election   contest,  which   can  be   substantial  and                                                                    
     burdensome. SB  246 outlines how legislators  may use a                                                                    
     legal fund to  pay attorney fees and  costs incurred if                                                                    
     their  election   is  challenged.  The  fund   will  be                                                                    
     regulated  by  the  Alaska Public  Offices  Commission.                                                                    
     This  bill provides  a way  for legislators  to receive                                                                    
     donations from  supporters to defend their  election in                                                                    
     court.                                                                                                                     
                                                                                                                                
          SB  246 is  intended to  protect the  integrity of                                                                    
     the electoral  process and  ensure legislators  are not                                                                    
     deterred from  seeking or holding office  by the threat                                                                    
     of  costly  litigation.  To  promote  transparency  and                                                                    
     accountability,  the bill  sets  limits and  disclosure                                                                    
     requirements for the  contributions and expenditures of                                                                    
     the  fund. The  Alaska Public  Offices Commission  will                                                                    
     adopt  regulations covering  how to  establish a  legal                                                                    
     fund,  what expenses  are allowed  from  a legal  fund,                                                                    
     what to  do with surplus  money from a legal  fund, and                                                                    
     how to  disclose contributions and expenditures  from a                                                                    
     legal fund. I urge your support for SB 246.                                                                                
                                                                                                                                
SENATOR WILSON said  he would work with the  Senate State Affairs                                                               
Committee, stakeholders,  and the  Division of Elections  to make                                                               
needed  changes.to  SB 246.  He  stated  that  there is  a  clear                                                               
delineation  that  APOC  would  establish  and  implement  a  fee                                                               
schedule, after elections.                                                                                                      
                                                                                                                                
4:44:38 PM                                                                                                                    
JULIA FONOV, Staff, Senator David Wilson, Alaska State                                                                          
Legislature, Juneau, Alaska, presented the sectional analysis                                                                   
for SB 246.                                                                                                                     
                                                                                                                                
[Original punctuation provided.]                                                                                                
                                                                                                                                
                       Sectional Analysis                                                                                     
                      Senate Bill 246 v. A                                                                                    
                                                                                                                              
     "An Act relating to a legal fund to pay attorney fees                                                                    
     and costs in an election contest; and providing for an                                                                   
                        effective date."                                                                                      
     Section 1  (Page 1,  line 4, through  page 4,  line 1):                                                                  
     Amends   AS   15   (Elections)  .13   (State   Election                                                                  
     Campaigns)                                                                                                               
     .116 (Disbursement of campaign assets after election)                                                                    
     Page  2, line  17,  through line  21:  (a) (6)  Repeals                                                                
     ambiguous language  regarding a fund for  costs related                                                                    
     to an election challenge.  Replaces it with a reference                                                                    
     to a legal fund as  established under section 3 of this                                                                    
     bill.                                                                                                                      
                                                                                                                                
     Section 2: Adds a new  subsection to AS 24 (Legislature                                                                  
     and Lobbying) .60 (Standards of Conduct) .080 (Gifts).                                                                   
     Page  4, line  2  through line  4:  (l) Specifies  that                                                                
     contributions  made  to  a legal  fund  as  established                                                                    
     under section  3 of this  bill do not qualify  as gifts                                                                    
     if the  reporting requirements under section  3 of this                                                                    
     legislation are met.                                                                                                       
                                                                                                                                
     Section 3: Adds a new  section .111 (Legal funds) to AS                                                                  
     24 (Legislature and Lobbying) .60 (Standards of                                                                          
     Conduct).                                                                                                                
     Page  4,  line   5  through  line  17:   (a)  Allows  a                                                                
     legislator to  establish a legal  fund to  pay attorney                                                                    
     fees and costs incurred in an election contest.                                                                            
     (b)  Specifies  that a  legislator  may,  at any  time,                                                                    
     solicit  and  accept  contributions  to  a  legal  fund                                                                    
     established                                                                                                                
     under this section. Requires  the Alaska Public Offices                                                                    
     Commission to adopt regulations on the following:                                                                          
     (1) establishing a legal fund,                                                                                             
     (2)  identifying allowable  uses  of money  in and  the                                                                    
     disposition of surplus money from a legal fund, and                                                                        
     (3)  requiring  disclosure   of  contributions  to  and                                                                    
     expenditures from a legal fund.                                                                                            
     (c) Specifies  a contribution  to a  legal fund  is not                                                                    
     subject  to the  restrictions  on  fund raising  during                                                                    
     session or the disclosure  requirements for gifts under                                                                    
     the Legislative Ethics Act.                                                                                                
                                                                                                                                
     Section  4:  Effective   date.  Provides  an  immediate                                                                  
     effective date                                                                                                             
                                                                                                                                
MS. FONOV  added that as  it is written,  SB 246 only  applies to                                                               
legislators.   Following  conversations   with  legislators   and                                                               
regulators, the bill sponsor is  pursuing changes for legal funds                                                               
to apply to all candidates.                                                                                                     
                                                                                                                                
4:47:35 PM                                                                                                                    
CHAIR KAWASAKI  asked if  SB 246, version  S, that  the committee                                                               
received, is the correct version.                                                                                               
4:47:46 PM                                                                                                                    
CHAIR WILSON acknowledged a typo in the bill.                                                                                   
                                                                                                                                
4:47:55 PM                                                                                                                    
SENATOR CLAMAN acknowledged that  there are currently no campaign                                                               
finance limits  and inquired whether the  intent of SB 246  is to                                                               
ensure that  legal funds would  not be subject to  finance limits                                                               
on how much a person can contribute.                                                                                            
                                                                                                                                
4:48:23 PM                                                                                                                    
SENATOR  WILSON noted  that SB  246 does  not establish  campaign                                                               
finance  limits but  suggested that  it could  be considered.  He                                                               
pointed  out that  legislators  can  currently receive  unlimited                                                               
campaign  contributions  that  can   be  allocated  toward  legal                                                               
defense funds.                                                                                                                  
                                                                                                                                
4:48:48 PM                                                                                                                    
SENATOR  CLAMAN  noted that  while  in  session, legislators  are                                                               
prohibited  from raising  money for  reelection. However,  during                                                               
the session, they are allowed to  raise funds for a legal fund to                                                               
cover legal expenses.                                                                                                           
                                                                                                                                
4:49:06 PM                                                                                                                    
SENATOR WILSON stated that under  the Ethics Act, legislators can                                                               
currently  receive  gifts  under  $250  for  the  purposes  of  a                                                               
campaign fund.  However, there is  no requirement  for disclosure                                                               
information regarding  the expenses  of those  funds that  can be                                                               
received while in session.                                                                                                      
                                                                                                                                
4:49:28 PM                                                                                                                    
SENATOR CLAMAN  asked for confirmation of  his understanding that                                                               
legislators  can receive  legal  contributions to  pay for  legal                                                               
expenses without a disclosure requirement.                                                                                      
                                                                                                                                
4:49:36 PM                                                                                                                    
SENATOR WILSON replied  yes and said the  contribution would need                                                               
to remain under $250 in accordance with the Ethics Act.                                                                         
                                                                                                                                
4:49:55 PM                                                                                                                    
CHAIR KAWASAKI opened  public testimony on SB  246; finding none,                                                               
he closed public testimony.                                                                                                     
                                                                                                                                
4:50:27 PM                                                                                                                    
CHAIR KAWASAKI held SB 246 in committee.