Legislature(1995 - 1996)
03/20/1996 05:05 PM FSH
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HB 542 - BOARD OF FISH VOTING ETHICS Number 0044 CHAIRMAN AUSTERMAN explained that he had introduced HB 542 through the House Community and Regional Affairs Committee. Basically, the bill changed the handling of conflicts of interest by the Board of Fisheries. Currently, when a board member had a conflict of interest, the conflict was stated by the member and the board ruled on it. "Part of the problem that we're having with that system right now is that, also, the Attorney General's Office has the ability to offer a letter of opinion on whether there is really a conflict and whether that member ... should or should not vote on an issue in front of the board," he said. As a result of those opinions, members with a conflict could neither participate in discussions nor vote on issues relating to that conflict. For example, a salmon fisherman who had one permit out of 800 had been ruled to have a conflict and thus was unable to testify on salmon issues. CHAIRMAN AUSTERMAN said, "The essence of what I've done with this bill is to make it mandatory for a member of the board to participate in all activities of the board, that he has to declare a conflict of interest but he does have to vote, very similar to what we, as legislators, have to do. It also removes the ability of the Attorney General to say, one way or the other, whether a person can vote or cannot vote." Number 0247 REPRESENTATIVE KIM ELTON stated his understanding that the bill allowed a person to declare a conflict and then have the board vote on whether or not that person was allowed to opt out. CHAIRMAN AUSTERMAN replied, "No, if my bill is enacted in law, it will not allow them to opt out at all." REPRESENTATIVE ELTON pointed out that in the legislature, the body decided whether or not to allow a person to opt out of voting. He wondered if there might be, at times, conflicts serious enough to allow the Board of Fisheries to decide whether a person should be allowed to opt out of voting. That would at least protect perceptions, and, in some cases, would provide a cloak of protection to a member who would then have to decide whether to do what they thought was right, or to vote in a manner that would minimize accusations of self-interest. Representative Elton asked if there had been any consideration of that middle ground. Number 0362 CHAIRMAN AUSTERMAN replied, "At this point in time, no." He explained that the Board of Fisheries, as well as the Board of Game, was a lay board for which people were expected and required to have expertise in certain areas. "We ask them to have that expertise, but then, when we get them there ... we don't let them vote," he said. Chairman Austerman believed that when someone was asked to sit on the board as a salmon fisherman, for example, there should be an understanding that there was an inherent conflict in salmon issues or fishing issues. Number 0428 REPRESENTATIVE ELTON outlined a scenario where the board would be asked to endorse the fish initiative. If a board member had helped to draft that initiative, there would be a conflict. Representative Elton suggested, under such a scenario, it may be to a member's advantage and may protect the integrity of the board if the board was allowed the option of saying, "we accept your declaration [of conflict] and we accept your request not to vote on the issue." Number 0508 CHAIRMAN AUSTERMAN responded that he considered it part of the job of being a board member. "As long as it's declared and everything is up-front, and everybody knows what your conflict of interest is when you vote, I see nothing wrong with it," he said, indicating it would give the board the power to discuss and react to the different issues before it. With the present forum, both discussion and input were often disallowed from the member who had the expertise. Number 0568 REPRESENTATIVE GARY DAVIS stated his understanding that there were seven board members. He asked if a majority of members present was required to take action. He suggested that with all their issues related to fish, and all members belonging to fisheries entities of one kind or another, there would always be someone abstaining. He asked how often abstention was requested. Number 0629 CHAIRMAN AUSTERMAN replied he had no answer. CHAIRMAN AUSTERMAN emphasized his opinion that the Board of Fisheries was a lay board and that members placed themselves in that position when they volunteered to serve on the Board of Fisheries. That was the reason he had drafted the legislation, he said. Number 0676 REPRESENTATIVE ELTON expressed that he thought Chairman Austerman was making an important point. "My understanding of the situation is, the way the Department of Law is now interpreting the interest ethics provisions, is that it is ... removing from people the ability to vote, whether the board wants that removal to occur or not," he said. He questioned whether the answer was a blanket provision requiring a member to vote. He suggested that, instead, a person could declare a conflict, ask to be excused from voting, and allow the board to decide. Then, in those few, extraordinary circumstances, the board could prohibit voting where necessary. "That way, it's a voluntary decision made by the board, rather than a mandatory decision, as it's now applied," he said. CHAIRMAN AUSTERMAN noted that Nick Szabo, a past Board of Fisheries chairman, was on teleconference to testify and answer questions. Number 0797 NICK SZABO testified via teleconference from Kodiak in support of HB 542. A member of the Board of Fisheries from 1975 to 1982, he had recently attended a meeting of past and present board chairmen, called by Chairman Austerman, where all present had fully agreed that the change proposed in HB 542 was most needed. MR. SZABO said, "Fisheries management and allocation decisions are very important to Alaska's economy. We need the full participation of members who are highly knowledgeable and widely experienced in a variety of different fishery uses. The issues are too complex and too important to risk their outcome on a board that doesn't fully understand all the implications of their decisions." MR. SZABO continued: "People with a lot of knowledge and experience are likely to have both a financial and a personal interest in an issue. However, the executive branch Ethics Act prohibits participation by a member with a financial or personal interest in the matter. With only a seven-member board that requires four votes, regardless of how many are in attendance, to pass an action, the Ethics Act frustrates the intent to have a board that is composed of members with knowledge and experience." Number 0904 MR. SZABO said, "At one time, the board had four members who held Bristol Bay salmon permits. Under the present legal opinions, that board couldn't function on any action that dealt with Bristol Bay. There have been other situations where only four or five members have been ruled eligible to participate in the board meeting. An action to change the status quo had failed by a 3-2 vote, yet a motion to approve findings to document the board's reasons for not changing the status quo also failed because only a small number were allowed to vote." MR. SZABO concluded: "To those who say this is an outrageous proposal and violates the public trust, I believe there are other ways to protect the public's interest while still allowing participation by members who are involved with the issues. The board could be required to document the reasons for an action by findings of fact. These findings would give the public a written basis for a controversial board decision. Possibly, each board member could additionally be required to produce personal findings explaining to the public their reasons for a particular vote. These additional obligations would require increased staff support, but if the board is to retain some autonomy from the Administration and the legislature, then they are very much needed and long overdue." Number 1142 REPRESENTATIVE ELTON asked Mr. Szabo whether, instead of a blanket mandate that lay members must participate, a system could be instituted in which a member declared a conflict, with the board then deciding whether the conflict was serious enough to excuse the member from the vote. This was similar to the legislature's system, he said, adding that he could not recall a situation where a legislator had actually been asked not to vote. Number 1086 MR. SZABO agreed there may be some extreme circumstances where a board member may have an exclusive interest from which only he or she may benefit. "I guess that it wouldn't hurt to put some exceptional provision in there, but I can't think of too many times when it would actually need to be exercised," he said. Number 1154 BRUCE SCHACTLER testified via teleconference from Kodiak in support of HB 542. He expressed agreement with Mr. Szabo's testimony, which he thought had pretty well covered the issue. "It's the biggest problem that we had with the board," he said, "the loss of the expertise that we've made such a big deal about putting on there." He emphasized that currently, members with conflicts could not be involved in conversations or the learning process a board went through about an issue. "Something has to be done about this conflict of interest, because we're just not getting the job done with the right people, even though the right people are available for the job," he concluded. Number 1240 JEFF STEPHANS, United Fishermen's Marketing Association, testified via teleconference from Kodiak in support of HB 542. He believed that the board had been ham-strung by the current Ethics Act and wanted to see the board operate where individual members were all allowed to vote after stating their conflicts. "The issue really is in the exercise of the conflict, not whether someone has a conflict," he said. "We believe that you want people on there who have the experience and investment in whatever facet of the industry - the fishing business - that they're in, whether it be recreational or sport or subsistence." He stated, "We'd like to see the legislature, somewhere along the line, require that the findings be required any time the board adopts a regulation and that they prove that a reasonable and rational consideration was given to the alternatives, and that any time they change the status quo or adopt a regulation, that there be a little bit more justification for their action." Number 1381 NEAL SLOTNICK, Assistant Attorney General, Civil Division (Juneau), Department of Law, pointed out what he saw as a potential technical problem in Section 3, which currently read: "Notwithstanding the prohibition against taking or withholding official action in (b)(4) of this section, a public officer who is a member of the Board of Fisheries must participate in matters before the board even if the member has a personal or financial interest in the matter." Mr. Slotnick explained, "My problem is with the language `notwithstanding the prohibition against taking or withholding official action in (b)(4) of this section'." He referred to AS39.52.120(a) and said it also included a prohibition against using or attempting to use an official position for personal gain. He said, "Now, the Department of Law has always interpreted the listing of specific prohibitions contained in (b) of .120 as being subsets of part (a), which is much broader, using or attempting to use your official position for personal gain. This language here seems to distinguish between the two. It might imply that (b)(4) is not a subset of .120(a). And I see potential interpretation or implementation problems here if we're trying to distinguish between using or attempting to use your official position for personal gain from taking or withholding official action in a matter in which you have a personal or financial interest." He suggested that the current committee, or a subsequent committee, consider language exempting the board member from the reach of .120(a), as well as .120(b)(4). Number 1493 CHAIRMAN AUSTERMAN asked for clarification. MR. SLOTNICK expressed concern over what .120(a) might apply to that was different from .120(b)(4). "For me, as the attorney who must implement the executive branch Ethics Act, it creates a dilemma of sorts," he said, explaining that .120(b) had several different listings of things that were prohibited. The Department of Law had always read that as a subset of the broad prohibition in .120(a), which was against using an official position for personal gain. "By making this distinction, it implies to me that maybe our interpretation might not be right," he said. "It certainly raises that potential argument if you're singling out only (b)(4) as ... the exemption here." He emphasized that it was a technical problem with the drafting. Number 1558 REPRESENTATIVE DAVIS agreed, saying that the wording in AS 52.120(a) was still in there. "And that says a public officer may not use or attempt to use an official position for personal gain and may not intentionally secure or grant unwarranted benefits or treatment for any person," he said. "If we're making a person vote on something that he's going to have a financial interest in, it's contrary to that." MR. SLOTNICK responded, "I could see a potential conflict in implementing this." CHAIRMAN AUSTERMAN asked Mr. Slotnick for his recommendation. Number 1624 MR. SLOTNICK suggested that wording such as "notwithstanding any other prohibition contained in this act" might be used. He clarified that he was not taking a position on HB 542 but was trying to help the committee implement its objective. He noted that Amy Daugherty, Legislative Aide to Representative Austerman, might have had language drafted to that effect; Ms. Daugherty subsequently handed out a new draft version of the bill, work draftG, dated 3/20/96. CHAIRMAN AUSTERMAN explained to Representative Ogan, who had recently joined the meeting, that the committee was looking at Section 3, page 2 and considering a possible amendment. Before the committee was the redraft of that section. REPRESENTATIVE DAVIS asked if a committee substitute had been adopted. CHAIRMAN AUSTERMAN replied no. He then noted that on page 2, Section 3, where it said, "Notwithstanding the prohibition against taking or withholding official action in (b)(4) of this section", the new language would read: "Notwithstanding any other provision of this chapter". Chairman Austerman asked if there was discussion or any problem with that language. He then substituted version G of the bill for version F, which had been before the committee but had not been formally accepted as a work draft. Number 1820 REPRESENTATIVE DAVIS moved that the committee accept work draft G, dated 3/20/96, as a committee substitute for HB 542. CHAIRMAN AUSTERMAN, hearing no objection to the motion, noted that the committee was officially using work draft G. REPRESENTATIVE ELTON said although he saw a need for the bill, he was bothered by what he sensed was a different application of the rules among boards. MR. SLOTNICK emphasized that he was not speaking for the Administration or the Department of Law. However, he had heard the view that if a variant of the legislative ethics model was going to be adopted, they should consider adopting it for all quasi- legislative bodies. He did not believe there had been deliberate differential application of the Ethics Act among the various boards and commissions. "The question is whether an individual member actually has a significant financial interest in the specific matter," he said. "And, if so, that's when that specific member must recuse him[self] or herself." He suggested there had been many situations, on many boards, where people had been required to recuse themselves. Number 1961 CHAIRMAN AUSTERMAN agreed there had been suggestions that this approach should, perhaps, be applied to all boards in the same manner. "In our experience, and the information we've been able to find out, there's only one of them that's not working right now, and not working very well, and that is the Board of Fish[eries," he said. The Board of Game, for example, did not have the same kind of problems. "I've never been in favor of just going and changing things or trying to fix a wheel that's not broke," he said, indicating that although other boards did not have the problem, the Board of Fisheries needed this change in order to function properly. Number 2011 REPRESENTATIVE SCOTT OGAN pointed out that the Board of Game did not have members who were commercial users, with the possible exception of a guide. He wanted to know whether the Board of Fisheries was required to have specified types of members in order to create balance. He suggested it might behoove the legislature to consider redefining the numbers of commercial fishermen, sports fishermen, public members, and so forth. "Because that's how the Big Game Commercial Services Board was set up," Representative Ogan said, "because there [were] conflicting interests. Then, there wasn't a problem with a conflict of interest because there was a balance in the structure of the board." Number 2080 CHAIRMAN AUSTERMAN stated he would be happy to look at some other structuring of how the Board of Fisheries members were appointed. However, he did not envision that happening currently. In lieu of that, he thought this was the correct step under the current system. "It's either that or we go to a professional board," he said. He indicated that there may not be support to put professional board legislation through this year. He expressed concern over having the Board of Fisheries be ineffective over the next year. REPRESENTATIVE DAVIS asked about the current make-up of the board. REPRESENTATIVE ELTON replied there were no designated seats. CHAIRMAN AUSTERMAN explained the Governor attempted to balance the board as well as he could when making appointments. To Chairman Austerman's understanding, there was nothing in statute that specified who those appointees would be. REPRESENTATIVE ELTON said that each governor had a different view of what that balance actually was. CHAIRMAN AUSTERMAN reiterated that if a lay board was going to make determinations on the resource, members should not be excluded from a determination just because they happened to be involved in the industry. Industry people were wanted on the board in the first place, to make the proper and knowledgeable decisions, he said. Number 2175 REPRESENTATIVE ELTON made a motion that CSHB 542 move from committee with individual recommendations. There being no objection, it was so ordered.