Legislature(1997 - 1998)
03/25/1997 08:07 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 181 - SEPARATE SEGREGATED FUNDS: POLIT. CONTRIB The next order of business to come before the House State Affairs Standing Committee was HB 181, "An Act relating to separate segregated funds for certain political contributions from corporations and labor organizations." Number 1356 REPRESENTATIVE VEZEY, sponsor, explained that it was just ruled in the Sixth Circuit Court of Appeals in Michigan AFL-CIO v. Miller that it was a constitutional right of a legislature to impose this type of bill. The subject of the bill was financing political activities without the consent of the person contributing the money. The bill addressed Title 15.13 and set it up so that political contributions had to be made out of segregated funds that were voluntarily contributed. He reiterated that the wording had been presented before the court and had been upheld. REPRESENTATIVE BERKOWITZ asked Chair James whether there would be more testimony. CHAIR JAMES indicated there would be if somebody wanted to testify. Number 1454 BROOK MILES, Regulation of Lobbying, Alaska Public Offices Commission (APOC), Department of Administration, was the first person to testify in Juneau. The APOC did not object to the concept of the bill, but it did have some concerns over the current legislative measure. MS. MILES explained that the APOC was concerned that the reader would misinterpret the prohibitions in Section 1 to Section 4, and she suggested deleting the sections entirely. MS. MILES explained that the APOC recommended the following language in AS 15.13.160: "Separate segregated funds cannot contribute to candidates or groups that are not parties or ballot measure groups." Number 1595 CHAIR JAMES asked Representative Vezey whether the separate segregated fund was made by voluntary donations and gave the authority for the money to go into a segregated fund, or whether it was the segregated fund that made the donations. Number 1651 REPRESENTATIVE VEZEY said he'd have to go back and check the court definition that the bill was following. The funds were not from groups. They were not voluntary donations. They were used for political purposes. CHAIR JAMES asked Representative Vezey to define the funds a little bit more. REPRESENTATIVE VEZEY said he'd have to do more research to determine what the courts were defining as a segregated fund. The bill required a separation of funds, and if the funds were going to be used for political contributions, then they would have to be voluntary contributions. Number 1741 REPRESENTATIVE BERKOWITZ asked Representative Vezey whether the term was defined in the Michigan court case. REPRESENTATIVE VEZEY replied, "Yes." Number 1753 CHAIR JAMES stated that she understood the intent of the piece of legislation. She wondered, however, whether the money that went into the segregated fund was voluntary and whether the money that wasn't voluntarily contributed went someplace else. Number 1885 REPRESENTATIVE VEZEY replied that Section 6 defined a separate segregated fund as monies collected that were not voluntarily contributed - corporate or union proceeds, for example. The funds could be contributed to activities related to politics, but they could not be contributed to a candidate or to a ballot proposition. Number 1946 CHAIR JAMES replied that campaign finance reform last year allowed for only individuals to contribute to groups. She wondered, therefore, whether a mandatory deduction could go to a group and then the group could contribute. In addition, the money that went to the group had to be voluntarily, and not mandatorily, contributed. Number 1977 MS. MILES replied that the bill required that the funds be voluntary contributions. MS. MILES said the APOC was also concerned that there was not a specific definition of a separate segregated fund. The APOC recommended the following language in AS 15.13.400: "The separate segregated fund means two or more individuals who affirmatively and voluntarily consent to make campaign contributions jointly through a payroll deduction plan, administered and controlled by a union, profit, or non-profit corporation of which the individuals are members, officer, stock holders, or employees". Number 2026 CHAIR JAMES said the suggested language by the APOC indicated that an individual could not contribute to candidates or groups that were not parties or ballot measure groups, but they could contribute to parties or ballot measure groups. MS. MILES replied, "Right." CHAIR JAMES said she thought they could not contribute at all if they were segregated funds. She thought the segregated funds were for those that did not voluntarily contribute funds. The suggested language indicated that a voluntary contribution could go towards parties or ballot measure groups. The segregated fund contained the "voluntary" and not the "involuntary" funds. MS. MILES replied, "Correct." CHAIR JAMES asked Representative Vezey what happened to the involuntary funds. Number 2080 REPRESENTATIVE VEZEY replied that under AS 15.13, we recused those from political activities last year. Number 2092 MS. MILES replied that those would still be considered contributions from individuals to a group. In other words, they would be political action committee (PAC) accounts. Number 2134 CHAIR JAMES said that was the problem. "I don't think we've solved the problem here," she added. MS. MILES said those were still individuals contributing to a group. CHAIR JAMES announced the bill needed to be worked on. "I don't think it does what you think it does," she said. REPRESENTATIVE VEZEY replied, "I believe it does do what I think it does." He said he'd bring more information to the committee members because he did not know the definition of separate segregated funds. The definition was from the Sixth Circuit Court of Appeals. It was well defined; the APOC simply did not agree with the legal drafter. CHAIR JAMES replied that they did not agree because it was not perfectly clear. She needed to study the bill further. She agreed with the concept that money which would go to a group that contributed to a candidate or party should not be taken involuntarily from individuals. The contributors needed to know where their money went, and if they weren't in favor of where it went, then it shouldn't be mandated. It was hard to believe that anybody would disagree with that premise. CHAIR JAMES announced the bill would be held in the committee today.
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