Legislature(2009 - 2010)CAPITOL 120
04/07/2010 01:00 PM House JUDICIARY
| Audio | Topic |
|---|---|
| Start | |
| SB110 | |
| SB284 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 284 | TELECONFERENCED | |
| + | SB 110 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 284 - CAMPAIGN EXPENDITURES
2:10:41 PM
CHAIR RAMRAS announced that the final order of business would be
CS FOR SENATE BILL NO. 284(FIN), "An Act relating to state
election campaigns, the duties of the Alaska Public Offices
Commission, the reporting and disclosure of expenditures and
independent expenditures, the filing of reports, and the
identification of certain communications in state election
campaigns; prohibiting expenditures and contributions by foreign
nationals in state elections; and providing for an effective
date."
CHAIR RAMRAS expressed an interest in getting the bill right the
first time to ensure that he does not leave behind legislation
that is ambiguous.
2:14:53 PM
SENATOR HOLLIS FRENCH, Alaska State Legislature, speaking as the
chair of the Senate Judiciary Standing Committee, sponsor of SB
284, and noting that members' packets include a sectional
analysis, explained that Section 1 of SB 284 amends language to
clarify that the chapter applies to all contributions,
expenditures, and communications made for the purpose of
influencing the outcome of an election; that Section 2 adds
language to clarify that the commission will assist all persons
to comply with the requirements of AS 15.13; and that Section 3
amends AS 15.13.040(d), to clarify that every person making an
independent expenditure must make a full report of those
expenditures, unless the person is exempt from report. He
reminded the committee that "persons" includes corporations and
labor unions.
2:16:10 PM
CHAIR RAMRAS asked what the term "exempt from reporting"
entails.
SENATOR FRENCH directed attention to language on page 6, lines
14-25, which read as follows:
Sec. 15.13.084. Prohibited expenditures. A
person may not make an expenditure
(1) anonymously, unless the expenditure
is
(A) paid for by an individual
acting independently of any person [GROUP OR NONGROUP
ENTITY AND INDEPENDENTLY OF ANY OTHER INDIVIDUAL];
(B) made to influence the outcome
of a ballot proposition as that term is defined by AS
15.13.065(c); and
(C) made for
(i) a billboard or sign; or
(ii) printed material, other
than an advertisement made in a newspaper or other
periodical;
SENATOR FRENCH offered his understanding that this is the only
category of expenditure still unreported and allowed to be
anonymous under state laws, and it is a "remnant" the sponsor
chose not to address in SB 284.
SENATOR FRENCH, in response to Chair Ramras, said the bill does
not affect current laws regarding candidates; however, if a
person donates $50 to an independent expenditure for or against
a candidate, the person's name and the amount donated will be
reported to the Alaska Public Offices Commission (APOC).
CHAIR RAMRAS said he would be offering an amendment so that the
same rules that apply to candidates would apply to the proposed
bill. He indicated that language on page 3, lines 16-20,
addresses this issue.
2:19:14 PM
SENATOR FRENCH noted that that is Section 4, and he emphasized
that Section 5 does not pertain to candidates; there is a
separate reporting section in AS 15.13.040 that covers the
reports made by candidates. Section 4 pertains to groups, non-
group entities, labor unions, and corporations, he said.
CHAIR RAMRAS cited paragraph (5), on page 3, lines 16-20, which
read as follows:
(5) the aggregate amount of all
contributions made to the person, if any, for the
purpose of influencing the outcome of an election; for
all contributions to the person that exceed $100 in
the aggregate in a year, the date of the contribution
and amount contributed by each contributor; and for a
contributor
CHAIR RAMRAS concluded that that means there would be no APOC
record for anyone who gives under $100. He expressed concern
that that could lead to the aggregation of many small donations,
resulting in "an amorphous entity that is spending money." He
said that seems to defeat some of the "more sledgehammer-like"
provisions of SB 284.
2:21:38 PM
SENATOR FRENCH explained that Section 5 amends language in AS
15.13.040(h), to clarify that the reporting requirements of AS
15.13.040(d) do not apply to an expenditure made by certain
individuals acting independently of every other person; that
[Section 6] amends AS 15.13.040(p) to clarify that a person who
is required to disclose contributions received by that person in
an expenditure report must report the true source of the
contributions as the contributor; and that [Section 7] defines
director and officer for the purposes of AS 15.13.040(e), as
that subsection is amended [by the bill].
2:23:04 PM
SENATOR FRENCH, in response to questions from Chair Ramras
pertaining to Section 5, concurred that the language refers to a
single individual with a single issue, and explained that the
$500 limit in a calendar year applies to billboards, signs, or
printed material concerning a ballot proposition.
2:25:03 PM
SENATOR FRENCH explained that Section 8 is a provision that
requires entities to establish a political activities account.
Currently, he said, candidates set up these accounts without
being required to do so, and the bill sponsor chose to make it a
requirement now that new entities will be taking part in Alaska
elections, so that their expenditures can be better monitored.
Senator French explained that Section 9 amends AS 15.13.067 to
clarify who may make an expenditure that is not an independent
expenditure in a state election for public office.
CHAIR RAMRAS directed attention to language in Section 8, on
page 4, lines 29-31, which read as follows:
(c) Each person who has established a
political activities account under this section shall
preserve all records necessary to substantiate the
person's compliance with the requirements of this
section for each of the six preceding years.
CHAIR RAMRAS asked how long the records would be held.
SENATOR FRENCH answered six years.
CHAIR RAMRAS asked the intent behind such a long period of time.
He said he does not mind the provision being applied to unions,
corporations, or environmental groups, but questioned holding to
the same standard persons who have a more narrow focus. He
explained, for example, that he doesn't want a group that has
raised $50,000 in order to positively influence a government
obligation (GO) bond, and then is shut down in perpetuity, to
have to hold that information for 6 years.
SENATOR FRENCH recommended that Mr. Ptasin address this issue.
2:29:27 PM
REPRESENTATIVE GATTO noted that the language on page 4, line 22,
read, "nongroup entity with an annual operating budget of $250
or less", and he asked if that should read "or more".
SENATOR FRENCH said he questioned that language as well, but he
deferred to Mr. Bullard or Mr. Ptasin for clarification.
2:30:05 PM
REPRESENTATIVE HERRON asked for confirmation that the State of
Alaska and a municipality cannot advocate for the passage of a
GO bond because both are considered to be a person, according to
statute.
SENATOR FRENCH responded that he thinks either one could
advocate for a GO bond, but questioned whether they can spend
public monies to do so. In response to a follow-up question, he
said he thinks it is accurate to say this is because both are
considered to be a person under statute.
2:31:02 PM
SENATOR FRENCH returned to the sectional analysis. He
acknowledged there has been a lot of concern about the new U.S.
Supreme Court ruling allowing not only corporations, but also
foreign corporations and foreign nationals to participate in
elections in Alaska. He explained that Section 10 addresses the
issue of foreign nationals and is drawn directly from federal
law. He maintained that it is important to mirror federal law
so the state APOC can use the same blocking provisions that the
FEC would use should a foreign national begin to spend money in
the state's elections.
CHAIR RAMRAS asked how this provision would affect those foreign
companies with American subsidiaries.
2:32:26 PM
SENATOR FRENCH replied that that issue is best exemplified in
[paragraph (5)] of Section 10. He explained that Section 10
lists those entities considered to be foreign nationals. The
language of paragraph (5) is on page 5, line 29, through page 6,
line 2, and read as follows:
(5) a domestic subsidiary of an
entity described in (2) - (4) of this subsection or a
domestic corporation controlled by an entity described
in (2) - (4) of this subsection, if that entity
finances, participates in, or selects a person who
participates in the making of a contribution or an
expenditure of the domestic subsidiary or domestic
corporation.
SENATOR FRENCH said the issue is the degree to which the foreign
company is controlling the subsidiary.
2:34:05 PM
CHAIR RAMRAS said although he does not know who pays for the
advertising for the Pebble Mine partnership, it is apparent
through discussions with the three producers that the decisions
are made by a higher authority - "the mother ship." He asked
how the standard would be set.
2:35:58 PM
SENATOR FRENCH surmised that it will always be difficult for
APOC or any other entity to prove that instruction for the
placement of the expenditure that came from a local subsidiary
was or was not ordered by a higher corporate force.
CHAIR RAMRAS expressed concern about ambiguity and that
paragraph (5) of Section 10 may dampen discourse rather than
expand it.
2:38:03 PM
SENATOR FRENCH said SB 284 engenders philosophical debates
regarding who participates.
2:38:19 PM
SENATOR FRENCH explained that Section 11 provides that no
person, other than an individual exempt from reporting, may make
an expenditure, unless the source of the expenditure has been
disclosed; Section 12 amends language in AS 15.13.084 to clarify
that a person may not make an expenditure anonymously unless it
is made for certain communications, as discussed previously; and
Section 13 expands the communication identification requirements
of AS 15.13.090 to apply to communications made by all persons,
and additionally requires a person other than a candidate,
individual, or political party to: one, identify the person's
principle officer; two, include a statement from that officer
approving the communication; three, provide the address of the
person's principle place of business; and four, identify the
person's five largest contributors. He offered his belief that
Sections 13 and 14 would be the topic of debate and amendment as
the bill goes forward.
REPRESENTATIVE HERRON opined that print advertising should be
distinguished from electronic, visual, and audio. He
recommended that in advertisement there be a five-second
profound statement for or against an issue, which clearly puts
forth who is making the statement.
2:40:56 PM
CHAIR RAMRAS noted that when an Alaska Gasline Inducement Act
(AGIA) hearing took place in Fairbanks a couple years ago, he
assembled 17 businesses that each put in $1,000 related to a
rally 900 constituents attended in support of getting natural
gas to Fairbanks. He expressed his desire to preserve the
opportunity for the public to participate and to be protected.
2:44:04 PM
SENATOR FRENCH explained that Section 14 provides how
communication identification requirements must be met in print,
video, and audio advertising. He noted that the identification
requirement for radio and other audio media [as shown on page 8,
lines 7-11], is more succinct, in order to fit within the time
allotted in radio advertising. In response to Chair Ramras, he
said he timed a radio advertisement; however, the timing was not
the same as it would be under SB 284, because the person doing
the voice-over included the city, state, and place of business.
He opined that the listener would be well-served to know if an
entity advertising is actually backed by three top oil
companies. In response to Chair Ramras, he indicated that the
identification portion of the radio advertisement was 10-12 out
of 30 seconds, which he said he finds acceptable.
CHAIR RAMRAS said that is not acceptable to him.
SENATOR FRENCH explained that Section 15 requires expenditure
reports to be filed within 10 days of the expenditure being
made. He offered his understanding that a related House bill
"took a stricter view of that." He explained that Section 16
amends the language of AS 15.13.111(a) to require all persons
who are required to report to preserve certain records for a
period of six years; Section 17 removes language from AS
15.13.135 that permitted only individuals, groups, or nongroup
entities to make independent expenditures [supporting or
opposing a candidate] and adds unions and corporations.
2:47:53 PM
CHAIR RAMRAS reiterated his concern about entities that form for
one purpose and then disband.
SENATOR FRENCH offered his understanding that those types of
entities would be a group entity focused on doing a good work in
the community without making a profit or existing past that
effort.
CHAIR RAMRAS surmised that the type of group he is trying to
preserve and protect is included in the language that is deleted
by Section 17.
SENATOR FRENCH noted that the terms "group" and "nongroup
entity" are also being deleted from Section 16, on page 8, line
19, because "person" is all-encompassing now so that everyone is
treated equally.
CHAIR RAMRAS expressed concern with a one-size-fits-all plan and
what it might do to smaller entities that are not planning to
exist beyond a certain project, such as the aforementioned 17
contributors to the rally.
2:49:31 PM
SENATOR FRENCH pointed out that in this regard, the bill does
not change existing law; it just includes the new players - the
corporations and unions - into the same provisions of law that
existed before the U.S. Supreme Court decision.
SENATOR FRENCH continued with the sectional analysis. He
explained that Section [18] addresses what will happen if an
entity breaks the law, and replaces "candidate, group, or
individual" with "person". He noted that campaign misconduct in
the second degree is a Class B misdemeanor. He explained that
Section 19 repeals AS 15.13.140(a), which is a provision that
provided that the chapter should not be interpreted to prohibit
a person from making independent expenditure in support of or in
opposition to a ballot propositional question. He said Section
19 removes ambiguity. Finally, Senator French explained that
Section 20 gives the Act an immediate effective date.
2:50:56 PM
SENATOR FRENCH, in response to Representative Lynn, offered his
understanding that implicit in every bill passed is a
severability clause.
2:52:10 PM
SCOTT SMITH, Legislative Liaison, Alaska Broadcasting
Association; Co-owner, KBOK/KRXX Radio, testifying on behalf of
ABA and himself, stated that all broadcasters fully respect the
need for transparency. He expressed his chief concern that
under SB 284, radio stations would become crippled in the
process of a long disclosure, and clients would decide against
advertising via radio. He related an instance when that
happened in the past.
MR. SMITH said radio stations tend to sell commercials in 30-
and 60-second units. He said he created a simulation of an
advertisement using the form of disclosure that would be
required under SB 284, and his professional disc jockey (DJ) was
able to read the disclosure in 13.5 seconds, which would mean
nearly 50 percent of a 30-second commercial going toward this
purpose. He said that is a major portion of advertisers'
budgets going to disclose who they are, which could really
discourage the smaller group, as mentioned by Chair Ramras, from
advertising on air.
MR. SMITH, in response to Representative Gatto, said the speed
at which he asked his DJ to read when testing the timing of the
disclosure was "hard speed." He said hard speed is clear and
audible, but not as fast as a "lightening read." In response to
a follow-up question, he said regulations require a DJ to read
in a reasonable manner in order to be understood.
2:56:12 PM
MR. SMITH, in response to Representative K. Holmes, estimated
that the aforementioned test run could have been trimmed to 9
seconds. In response to Representative Lynn, he said it is
impossible to guess how much revenue may be lost as a result of
people not advertising through radio because of the proposed
disclosure requirement, but he said the concern is great enough
for him to have flown to Juneau to testify. He said he thinks
smaller groups would be more greatly affected.
2:57:49 PM
REPRESENTATIVE GRUENBERG noted that there are 3 provisions in
the bill that address that question. First, language on page 6,
line 29, requires that all communications be clearly identified.
Second, language on page 7, line 28, requires the communication
to be easily discernable. Finally, language on page 8, line 6,
requires the audio communication to be read in a manner that is
easily heard. He questioned the use of the word "heard" and
suggested instead that the bill sponsor consider use
"understood".
REPRESENTATIVE LYNN suggested "easily discernable".
REPRESENTATIVE GRUENBERG concurred. He explained that he is
hard of hearing and sometimes hears words without out completely
understanding them.
2:59:33 PM
REPRESENTATIVE GATTO asked whether the public cares about who -
other than candidates, organizations, or campaigns - pays for
advertising.
MR. SMITH said he has no data in that regard. He noted that
there are a series of Federal Communications Commission (FCC)
regulations that would also apply, in terms of disclosure; there
are requirements beyond any surveys that could be done.
CHAIR RAMRAS again relayed that his concern is whether the bill
would dampen discourse.
MR. SMITH, in response to Chair Ramras, said that during a
municipal election there are anywhere from 5-9 different
entities working on different issues and an equal number of
private groups. In a major statewide election, he related,
there tends to be more people involved within organized groups
both inside and outside the state. He surmised the reason for
this is because statewide elections bring forth more voters,
which requires more outreach to communicate messages beyond the
big cities. In response to comments and a question, he
indicated that as the fifth largest city in the state, Kodiak
would have statewide groups involved with its elections.
3:05:01 PM
CHAIR RAMRAS asked how the requirement for three top people
would be grouped from various organizations.
MR. SMITH relayed that he had been asked to come before the
legislature to ask - should there be a requirement to name more
than the top contributor - that another method for people to see
that be provided, either through APOC or by means of a directive
to go to another source. His interpretation, he added, is that
the company name would be sufficient, because that would
identify who the interested party is and the message. He said
it would be obvious who was behind an advertisement if, for
example, it was an advertisement to promote drilling for oil and
BP's name was listed.
CHAIR RAMRAS questioned if naming BP three times would satisfy
the requirement to list the top three contributors. He offered
an example of a union listed, and he questioned how three
members of that union would be chosen to list.
MR. SMITH offered his hope that merely listing the name of the
union would be enough, because that would disclose the
organization involved. He added that seeing the names listed of
three people inside of that union would not mean much to him as
a voter.
3:08:36 PM
REPRESENTATIVE GRUENBERG noted that up until recently his office
was tracking cases in which Citizens United was discussed, to
gather any information that may help in determining how any
federal or state court was interpreting or utilizing opinions in
that case. He asked if any related information has come out in
the last three weeks.
3:09:31 PM
JOHN PTACIN, Assistant Attorney General, Labor and State Affairs
Section, Civil Division (Anchorage), Department of Law (DOL),
explained that there were two cases in the last three weeks -
one in the District Court of Appeals in Washington, D.C. He
reviewed that there is a provision in federal law that did not
allow "a bunch of people to ... group assemble." Furthermore,
the provision limited the amount of money that groups could
bring in from individual contributions. As a district court
case, he noted, it does not really impact any of the analysis in
SB 284. He related that there was another case that upheld
certain limits on "soft money," which is also a provision that
is not addressed in SB 284. He noted that there is a case
coming to the U.S. Supreme Court at the end of the term, in
which the court will discuss extending anonymous speech into new
areas, and that discussion may have an impact depending on how
far the court goes.
3:10:40 PM
MR. PTACIN, in response to a follow-up question, said there was
a Washington state ballot initiative that was held about two
years ago. The question raised was whether the signatures can
be withheld from public disclosure; whether a person signing,
who could be harassed because of signing, could petition to keep
that signature from public view. This distinction may or may
not expand the court's position on what can and cannot be
anonymous action in political speech, and whether that is, in
fact, political speech. He said that is scheduled for argument
at the end of the month, and he surmised there would be a
decision by late June.
3:11:46 PM
REPRESENTATIVE HERRON questioned whether there would be some way
to clarify that the person advocating and spending money for any
issue is for or against an issue - a direct statement made in
audio advertising. He clarified that as a television viewer, he
is more interested in being given a clear message as to whether
the person involved in the advertisement is for or against a
particular issue.
3:12:57 PM
MR. PTACIN said whether a person is for or against an issue must
be implicit in the advertisement. Adding a secondary disclaimer
is an issue he said he would like to review further.
REPRESENTATIVE HERRON clarified that he is only concerned about
the issue as it pertains to audio and visual advertisement; he
said he is not concerned about print.
CHAIR RAMRAS summarized that this issue seems to be about
disclosure and discourse - whether or not seeking to expand upon
the former will risk dampening the latter. He expressed concern
about ambiguities and how they are handled by APOC.
3:16:21 PM
MR. PTACIN noted that the case APOC v. Stephens taught that
ambiguity cannot be held against somebody who violates the
statutes - at least in a monetary sense. He clarified, "If
there's ambiguity in any of these statutes, the enforceability
of it is diminished." With respect to dampening discourse, he
said that is the debate after Citizens United. That case, he
said, allowed a number of entities that could not speak before
do so now. The question going forward is going to be whether a
disclosure or disclaimer law will overly burden that newly found
right.
CHAIR RAMRAS again questioned whether the regulation of rights
that have been restored to persons will result in impairing
disclosure for smaller groups.
MR. PTACIN said the real question is whether there is an
election pending with a bond initiative, ballot initiative, or
candidate election looming, because "that's when the
jurisdiction comes to fore."
CHAIR RAMRAS asked, "If BP runs an ad, who are their largest
contributors?"
MR. PTACIN said BP Alaska would be permitted to run an
advertisement with domestic profits. The money would come from
its own corporate treasury; there would not be any contributors.
In response to a follow-up question, he said whether or not BP
would have to follow the "top three contributors" rule under SB
284 would depend on whether there are other entities that are
contributing to BP in order to fund that messaging. He offered
his understanding that the top contributors would not have to be
listed if they did not exist.
CHAIR RAMRAS said as a lay person that is not how he reads the
requirement; however, he acknowledged that he sees others in the
room nodding. He then asked who would be the top three
contributors to a union with 10,000 members.
MR. PATACIN reiterated his understanding that if the entity is
using general treasury funds to advertise, then there would not
be any contributors to that political messaging. However, if
the union pooled money from some other entity, then that would
be another matter.
CHAIR RAMRAS again expressed concern over ambiguity and
expressed a wish to discuss the issue further.
[CSSB 284(FIN) was held over.]
| Document Name | Date/Time | Subjects |
|---|---|---|
| 01 SB110 Sponsor Statement.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 110 |
| 02 SB110 Sectional Analysis.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 110 |
| 03 CSSB 110(FIN) Version C.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 110 |
| 04 SB0110-4-1-031510-FIN-N.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 110 |
| 05 SB0110-5-1-031510-DPS-N.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 110 |
| 06 SB0110-6-2-031510-LAW-Y.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 110 |
| 07 SB110 Bill v. A.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 110 |
| 08 SB110 Articles.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 110 |
| 01 SB284 Sponsor Statement.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 284 |
| 02 SB284 Sectional 4.2.10.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 284 |
| 03 SB 284 Bill version P.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 284 |
| 04 SB284 DOA Fiscal Note.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 284 |
| 05 SB284 OOG Fiscal Note.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 284 |
| 06 SB284 AG analysis 2.19.10.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 284 |
| 07 SB284 Bullard memo 3.17.10.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 284 |
| 08 SB284 Relevant Statutes.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 284 |
| 09 SB284 Support.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 284 |
| 10 SB284 Articles.pdf |
HJUD 4/7/2010 1:00:00 PM |
SB 284 |
| Proposed HJUD CS version M.pdf |
HJUD 4/7/2010 1:00:00 PM |