Legislature(1999 - 2000)

05/06/1999 08:11 AM House STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 179-APOC REPEAL: CAMPAIGN/DISCLOSURE/LOBBYIST                                                                                
CHAIR JAMES announced that the only order of business before the                                                                
committee is SSHB 179 "An Act eliminating the Alaska Public Offices                                                             
Commission and all campaign contribution and expenditure limits;                                                                
transferring the administration of lobbying, conflict of interest,                                                              
and financial disclosure statutes from the Alaska Public Offices                                                                
Commission to the division of elections; relating to reporting of                                                               
campaign contributions and expenditures; defining 'full                                                                         
disclosure,' 'purposely,' 'recklessly,' and 'resident'; amending                                                                
the definition of 'contribution,' 'group,' and 'political party';                                                               
changing the residency requirements for candidates for public                                                                   
offices; and providing for criminal penalties for violation of                                                                  
these provisions."  She mentioned that the committee has two                                                                    
versions of SSHB 179 before them.                                                                                               
Number 018                                                                                                                      
REPRESENTATIVE COGHILL pointed out that the difference between the                                                              
version before the committee yesterday and today's version is that                                                              
the language was not kept consistent with the change from                                                                       
"division" to "center."                                                                                                         
Number 033                                                                                                                      
REPRESENTATIVE OGAN moved to adopt proposed CSSSHB 179, version                                                                 
LS0401\I, as the working document before the committee.  There                                                                  
being no objection, it was so ordered.                                                                                          
REPRESENTATIVE COGHILL explained that there are several changes                                                                 
which resulted from testimony, suggestions from committee members,                                                              
and additional language making SSHB 179 clearer.  He referred to                                                                
the title on page 1 and noted that it is still an Act eliminating                                                               
the Alaska Public Offices Commission.  However, the same acronym,                                                               
APOC, is utilized for the establishment of the Alaska Public                                                                    
Offices Center which remains within the Division of Administration.                                                             
Representative Coghill mentioned that the three major principles he                                                             
chose to guide the movement of this particular bill are maintained.                                                             
The bill maintains the separation of powers between the judiciary                                                               
and the administrative aspects, while allowing for open disclosure                                                              
and no limits, although there are some regulations as to how those                                                              
funds can be spent and reported.  He noted that the public offices                                                              
center will be adjacent to the Division of Elections affording a                                                                
possible candidate the ability to apply for candidacy near where                                                                
the reporting takes place.                                                                                                      
REPRESENTATIVE COGHILL referred to Section 1, paragraph (1), "the                                                               
purpose of campaign disclosure is to make available to Alaskan                                                                  
voters all information concerning contributions and expenses of                                                                 
political candidates" which he identified as the intent behind this                                                             
legislation.  The legislation also hopes to, as paragraph (2)                                                                   
states, "...to make campaign laws less ambiguous and burdensome to                                                              
both the candidates and to their supporters" which provides a                                                                   
clearer environment.  He continued with the purpose discussed in                                                                
paragraph (3), "the purpose of this Act is to produce a simplified                                                              
reporting system that is less intrusive and gives optimal freedom                                                               
with fair accountability.  The aim is to arrive at full disclosure                                                              
Number 117                                                                                                                      
REPRESENTATIVE COGHILL explained that Section 3 is existing                                                                     
statute.  He noted that Section 3 repeals AS 15.13.020, which                                                                   
established the [Alaska] Public Offices Commission.  Section 3                                                                  
would de-politicize those working within the [Alaska] Public                                                                    
Offices Center.  Section 4 outlines the duties of the center, such                                                              
as  preparing the forms and displaying the reports.                                                                             
CHAIR JAMES commended Representative Coghill for his work and noted                                                             
this is a drastic change that will require a lot of work to bring                                                               
people along on this issue.  She agreed with the "Findings and                                                                  
Purpose" of the legislation which she believed had much merit.  She                                                             
commented that the public has indicated the need for less rules and                                                             
regulations leaving the public to decide whether a candidate is                                                                 
honest or not from the disclosure.  Chair James announced that she                                                              
would like to move SSHB 179 onto the House Judiciary Committee.                                                                 
REPRESENTATIVE COGHILL referred to page 23, Section 24.45 which                                                                 
relates to lobby regulations, noting that the word "Center" is                                                                  
added which would also be the case on page 33, AS 39.50 which deals                                                             
with conflict of interest.  Those are really changes in address                                                                 
versus substantive changes.                                                                                                     
Number 208                                                                                                                      
CHAIR JAMES clarified that the additions in those cases are the                                                                 
same as they are currently, except for the change in title.                                                                     
REPRESENTATIVE COGHILL agreed.  He referred to page 6, Section 5                                                                
which was taken, for the most part, from the current APOC                                                                       
regulation with regard to contributions.  Section 5 also outlines                                                               
what one would have to report on the form provided by the center.                                                               
He pointed out that there is a provision that allows for the form                                                               
to be provided electronically or by hard-copy.  He referred to page                                                             
4, line 21, noting that language requiring a report of the                                                                      
aggregate of those contributions under $100.  He noted that the                                                                 
same criteria utilized for contributions is utilized for loans as                                                               
Number 252                                                                                                                      
REPRESENTATIVE COGHILL explained that page 4, subparagraph (E)                                                                  
deals with detailing records.  He noted that the bookkeeping system                                                             
was taken from the APOC as it is currently in order to allow for                                                                
inspection.  He moved to Section 6, page 6, and stated, "Those who                                                              
are going to oppose or support a candidate before they can make an                                                              
expenditure in support of or opposition, they need to come to the                                                               
APOC, the center, and register that they are in fact doing that."                                                               
CHAIR JAMES inquired as to who "each person" refers in Section                                                                  
6,"(a) Before making an expenditure in support of or in opposition                                                              
to a candidate or before making an expenditure in support of or in                                                              
opposition to a ballot proposition or question, each person other                                                               
than an individual shall register."                                                                                             
Number 287                                                                                                                      
RYNNIEVA MOSS, Legislative Assistant to Representative Coghill,                                                                 
explained that the definition of "person" includes groups,                                                                      
political parties, and those that would have to register.                                                                       
REPRESENTATIVE COGHILL pointed out that the definition section                                                                  
begins on page 20.                                                                                                              
REPRESENTATIVE COGHILL continued with Section 7 which deals with                                                                
campaign treasurers.  The candidate is assumed to be the treasurer                                                              
if no treasurer is appointed.  Section 7 also specifies that those                                                              
running a campaign for a ballot issue, or some other issue, also                                                                
have to have a treasurer.  He moved on to Section 8 regarding                                                                   
audits.  He said, "...starting in (c) on line 18, if there is a                                                                 
'failure, refusal or neglect to cooperate with the Center by a                                                                  
candidate, group, political party, municipality, or individual                                                                  
could result a person being fined and/or convicted.'  And what we                                                               
wanted to do was we wanted to take it out of the center's hands by                                                              
saying, if you find in an audit then under [AS 15] 13.125 and [AS                                                               
15] 13.170, a civil or criminal action could ensue.  It goes out of                                                             
the hands of the department at that point, or the center, and goes                                                              
over for court action."                                                                                                         
CHAIR JAMES said that would assume that it's not automatically                                                                  
going to court action or would somebody have to file an action.                                                                 
Number 334                                                                                                                      
REPRESENTATIVE COGHILL confirmed that an action would have to be                                                                
filed, either by the center or by an individual.  The center would                                                              
only show that there was probable cause, but would not begin the                                                                
action.  He added that there could be civil penalties which are                                                                 
outlined in SSHB 179 regarding late filing.  If there is an                                                                     
accusation, this provides the center the opportunity to say, "Bring                                                             
your books and let's take a look at them."                                                                                      
CHAIR JAMES commented that Representative Coghill seems to desire                                                               
full disclosure.  She asked if the center found irregularities,                                                                 
would such be recorded on the Internet so that the general public                                                               
has access to that information.                                                                                                 
REPRESENTATIVE COGHILL replied yes.  If there is a violation, that                                                              
is on the record for open disclosure.                                                                                           
CHAIR JAMES asked if a violation would appear on the Internet                                                                   
before the candidate had an opportunity to defend himself or                                                                    
herself.  Would the center contact that candidate with regards to                                                               
a violation?                                                                                                                    
REPRESENTATIVE COGHILL explained that the legislation includes a                                                                
provision requiring the center to notify the candidate within five                                                              
days of a challenge or failure to disclose.  Before any action                                                                  
begins, notification must occur.  There is also a civil penalty                                                                 
that will ensue and can be appealed, if the records are shown to be                                                             
in order.                                                                                                                       
Number 400                                                                                                                      
CHAIR JAMES expressed concern with the notion of "innocent until                                                                
proven guilty."  She did not have a problem with drawing attention                                                              
to something, but she did not want there to be an assumption that                                                               
there is a violation until such a determination has been made.                                                                  
REPRESENTATIVE COGHILL noted that determining when to "put a flag                                                               
up on the screen or the file" was a struggle.  The five-day                                                                     
notification process provides a week for response.  He commented                                                                
that in a political race weeks are very important.                                                                              
CHAIR JAMES asked if under this full disclosure, would the exchange                                                             
between the center and the candidate be on the candidate's file. If                                                             
a candidate missed a filing deadline for health reasons or a death                                                              
in the family, would the five day notice go in the candidate's file                                                             
for the public to review.  If the candidate responds to the center                                                              
with one of the aforementioned excuses, would that be filed for the                                                             
public to review as well.                                                                                                       
REPRESENTATIVE COGHILL replied that there is not a provision for                                                                
such a communication to be on the Internet.  He said that he was                                                                
primarily interested in ensuring that the transactions for                                                                      
expenditures, contributions, and failure to disclose were                                                                       
CHAIR JAMES pointed out that there are as many complaints about                                                                 
APOC as there are about the candidates or the contributors.  She                                                                
believed that if there is going to be full disclosure, the                                                                      
communication between APOC and the candidate should be on the                                                                   
candidate's report for public review.                                                                                           
Number 470                                                                                                                      
REPRESENTATIVE OGAN expressed concern with Section 26, which reads,                                                             
"A qualified Alaska resident may bring civil action and/or file a                                                               
complaint for criminal action with the district attorney to enforce                                                             
any of the sections of this chapter."   He foresaw someone filing                                                               
a criminal action for the sake of discrediting the name of the                                                                  
candidate which would result in legal fees and other complications.                                                             
CHAIR JAMES asked if that was currently allowed.                                                                                
REPRESENTATIVE OGAN pointed out that it is a new section.                                                                       
REPRESENTATIVE COGHILL clarified that cause would have to be shown                                                              
and then the proof is on failure to disclose.  There are criteria                                                               
for civil and criminal action in this as well as civil penalties.                                                               
He believed an individual would have to have a clear case based on                                                              
this law to bring a civil action for failure to disclose.                                                                       
Number 502                                                                                                                      
CHAIR JAMES asked if SSHB 179 makes it easier or more difficult for                                                             
a candidate to do that than in existing law.                                                                                    
REPRESENTATIVE COGHILL said he could not answer that.                                                                           
REPRESENTATIVE OGAN said that he believed the commission has the                                                                
authority to recommend whether or not there is a criminal violation                                                             
under the current language.  He further stated, "You take a look at                                                             
the ethics charges that go on in a campaign, you get into a really                                                              
close race - and I can think of one ... and suddenly these ethics                                                               
charges brought against different candidates and a lot of times                                                                 
people do that as a political strategy rather than any substantive                                                              
charges."  He predicted that this would be used as a political tool                                                             
against candidates.                                                                                                             
CHAIR JAMES asked if SSHB 179 included a restriction regarding when                                                             
such things can be filed during an election.                                                                                    
REPRESENTATIVE COGHILL replied yes.                                                                                             
CHAIR JAMES asked if everything in a campaign is listed on the                                                                  
candidate's report and is available for public review,  wouldn't                                                                
that place the onus on the person making the charge as opposed to                                                               
giving protection to the person who is not.                                                                                     
Number 542                                                                                                                      
REPRESENTATIVE KERTTULA stated that this would actually allow a                                                                 
person to file a formal complaint for even criminal action.  She                                                                
further stated, "I've never seen it happen and ... I'm sure it                                                                  
wasn't in the APOC statute - before you'd have to go through the                                                                
district attorney's office to screen to be able to file a criminal                                                              
(indisc.--simultaneous speech)."  Representative Kerttula agreed                                                                
with Chair James regarding the reporting, but noted that this                                                                   
allows the case to be brought forth.                                                                                            
REPRESENTATIVE COGHILL commented that the legislation may be                                                                    
off-base on that point.  Bringing a civil action is well within                                                                 
your limits, but bringing a criminal action still has to go through                                                             
the district attorney.                                                                                                          
CHAIR JAMES inquired as to how things that have been published in                                                               
the newspaper over the years would have been different if full                                                                  
disclosure had been in place.                                                                                                   
Number 573                                                                                                                      
REPRESENTATIVE COGHILL stated, in his view, that full disclosure                                                                
comes with a higher degree of responsibility.  Therefore if this is                                                             
open to the public and a problem is found, there should be                                                                      
recourse.  He did not believe that to be frivolous because one                                                                  
would still have to go before a judge.  Representative Coghill                                                                  
agreed with Representative Ogan's point that somebody could just                                                                
make a charge which would be damaging, just as is the case in                                                                   
accusations of child abuse sometimes the entire story is never                                                                  
REPRESENTATIVE OGAN commented that full disclosure already exists.                                                              
CHAIR JAMES agreed there is full disclosure, however, that                                                                      
information is not current.  Much time passes between the reporting                                                             
deadlines.  She also indicated the need to report who pays for a                                                                
candidate's television time.                                                                                                    
REPRESENTATIVE KERTTULA noted that is reported.                                                                                 
CHAIR JAMES reiterated there is a long period of time during the                                                                
campaign before the 30-day report is required and nobody knows what                                                             
is happening during that time.  She expressed concern with that                                                                 
time period.                                                                                                                    
Number 628                                                                                                                      
REPRESENTATIVE COGHILL commented that, from his understanding, the                                                              
contributors and voters do not know the contribution limits or the                                                              
laws which apply to contributions.  This legislation eliminates the                                                             
limits and makes it open immediately so that the public has the                                                                 
ability to make that judgement call which he believed provided a                                                                
higher degree of accountability.                                                                                                
CHAIR JAMES informed the committee that she likes full disclosure                                                               
and does not have a problem with reporting every half a month, but                                                              
in order to achieve such something must be offered.  If the limits                                                              
and specific things are lifted, then full disclosure is not so                                                                  
burdensome and a give-and-take situation would exist.                                                                           
REPRESENTATIVE COGHILL referred to page 15, line 23, Section 26,                                                                
and asked Representative Kerttula if it would be better on line 23,                                                             
after "and or," to insert "formal" so that it would read, "file a                                                               
formal complaint for criminal actions with the district attorney to                                                             
enforce any of the sections in this chapter."                                                                                   
Number 659                                                                                                                      
REPRESENTATIVE KERTTULA pointed out that the representative from                                                                
the court system might be able to comment on that.  However, she                                                                
noted that an individual can always file with the district                                                                      
attorney, which means the individual could phone the district                                                                   
attorney.  Therefore, Representative Kerttula believed that                                                                     
inserting "formal" might create another process making it more                                                                  
REPRESENTATIVE COGHILL said he is open for discussion, however, the                                                             
next committee of referral is the House Judiciary Committee which                                                               
may be better able to address that issue.                                                                                       
REPRESENTATIVE SMALLEY referred to Section 4, page 3, lines 12-16                                                               
and read the following: "and shall charge an at cost fee for                                                                    
reports not electronically filed to cover the cost of keying in the                                                             
report."  Although candidate's should be encouraged to use                                                                      
electronic filing, there will be situations in which electronic                                                                 
filing will not be available to a candidate.  This would actually                                                               
penalize a candidate who is already operating "off a shoestring"                                                                
budget or does not have the ability to file electronically which                                                                
creates an unfair burden.                                                                                                       
REPRESENTATIVE COGHILL said he did not necessarily disagree with                                                                
Representative Smalley.  He said he was trying to create incentives                                                             
for computerized filing and discourage paper flow.                                                                              
Number 699                                                                                                                      
REPRESENTATIVE SMALLEY suggested that if the report is not filed                                                                
electronically, it could be filed the day prior to electronic                                                                   
CHAIR JAMES agreed candidates should be treated equally.  She                                                                   
indicated that a small charge of $10 for someone to electronically                                                              
enter a candidate's report would be appropriate.                                                                                
REPRESENTATIVE COGHILL mentioned that the Division of Elections                                                                 
charges for lists and the copying of disks.  He did not want to                                                                 
make this a burden to the center, but wanted to provide an                                                                      
incentive for electronic filing and cover the cost of a lot of                                                                  
REPRESENTATIVE SMALLEY commented that even a charge of five cents                                                               
is an unfair penalty to a candidate that does not have the ability                                                              
or lacks the necessary equipment.                                                                                               
CHAIR JAMES stated that everyone could be charged a fee and those                                                               
that filed electronically could be excused from the fee.                                                                        
REPRESENTATIVE COGHILL said he would make note of Representative                                                                
Smalley's point.                                                                                                                
Number 765                                                                                                                      
REPRESENTATIVE COGHILL referred to page 9, Section 12 and                                                                       
reiterated that corporate giving is a problem.  After reviewing                                                                 
what the supreme court said, "That corporations were not primarily                                                              
formed for political action," it was determined best to incorporate                                                             
language which prohibited corporations, companies, partnerships,                                                                
and anything that was not defined as a group or political action                                                                
committee.  He pointed out that the definition of group is defined                                                              
on page 20, line 13 and "political action committee" is defined on                                                              
page 21, line 13.                                                                                                               
REPRESENTATIVE COGHILL further explained if corporations wanted to                                                              
have a PAC, as they can now, that...                                                                                            
Number 795                                                                                                                      
CHAIR JAMES pointed out that corporations cannot have a PAC                                                                     
currently and all corporation funds are disallowed.                                                                             
REPRESENTATIVE COGHILL agreed.  He clarified that if somebody                                                                   
within a corporation wanted to have a PAC, he/she would still have                                                              
to have that individual input.  Although the PAC could still be                                                                 
called the "xyz" company PAC, only individuals could contribute to                                                              
it and the reporting would be under the group's name.                                                                           
CHAIR JAMES said that she did not believe this language reflected                                                               
that intent.                                                                                                                    
REPRESENTATIVE SMALLEY inquired as to the location of the                                                                       
requirement that a PAC be registered.                                                                                           
Number 815                                                                                                                      
REPRESENTATIVE COGHILL referred to page 6, line 16, Section 6 (a)                                                               
which reads, "Before making an expenditure in support of or in                                                                  
opposition to a candidate or before making an expenditure in                                                                    
support of or in opposition to a ballot proposition or question,                                                                
each person other than an individual shall register, on forms                                                                   
provided by the Center, with the Center."  He also noted that                                                                   
Section 7 outlines the requirements for the campaign treasurer                                                                  
which follows the reporting procedure.                                                                                          
CHAIR JAMES referred to the definition of "immediate family," on                                                                
page 20, line 17 and inquired as to the meaning of "spousal                                                                     
REPRESENTATIVE COGHILL said he did not know if "spousal equivalent"                                                             
would fall under "spouse" technically and legally, or if "spousal                                                               
equivalent" is required.                                                                                                        
Number 838                                                                                                                      
CHAIR JAMES deferred to Martin Shultz, Department of Law.                                                                       
TAPE 99-34, SIDE B                                                                                                              
[Tape flipped early - no testimony was lost; approximately four                                                                 
minutes of blank tape.]                                                                                                         
Number 001                                                                                                                      
CHAIR JAMES asked, "If we wanted to be sure we treated spousal                                                                  
equivalent the same way, do we have to specifically say spousal                                                                 
equivalent, or would they be included in that listing."                                                                         
Number 022                                                                                                                      
MARTIN SCHULTZ, Assistant Attorney General, Civil Division,                                                                     
Governmental Affairs Division, Department of Law, testified via                                                                 
teleconference from Anchorage.  He believed spousal equivalents are                                                             
currently set out in some statutes, and those would have to be                                                                  
specifically included if the desire is to include that group.                                                                   
REPRESENTATIVE COGHILL confirmed that spousal equivalents would be                                                              
added on line 17.                                                                                                               
CHAIR JAMES agreed.                                                                                                             
CHAIR JAMES asked Mr. Shultz if grandchildren would be considered                                                               
"immediate family," if those grandchildren are living in the same                                                               
MR. SHULTZ stated that anyone that the committee wishes to include                                                              
should be specifically listed.  For example, if the committee                                                                   
wanted to include the spousal equivalent's children that should be                                                              
listed as well.                                                                                                                 
CHAIR JAMES said she believed the definition of "political action                                                               
committee" would, for all practical purposes, include corporation                                                               
money which she did not think was the intent on page 21, line 14.                                                               
She stated, "I think it just means a combination of two or more                                                                 
individuals.  If we're making it only individuals can donate to                                                                 
PACs and only individuals can donate to groups, then I think you                                                                
don't want to say, 'or a person other than an individual,' and then                                                             
include them in the PACs.  You're allowing a contribution from                                                                  
someone other than an individual and that would be like corporation                                                             
money, association money ... it's always an employee's PAC."                                                                    
Number 110                                                                                                                      
REPRESENTATIVE COGHILL suggested then after "individuals" delete                                                                
lines 13 and 14, through "which."                                                                                               
CHAIR JAMES agreed.  She informed the committee that she did not                                                                
see the possibility of moving SSHB 179 out of committee.  She                                                                   
suggested the committee work on the legislation during the interim.                                                             
REPRESENTATIVE COGHILL noted another change was made on page 21,                                                                
Section 31 regarding the declaration of filing procedure which was                                                              
placed within the Division of Elections.  The Division of Elections                                                             
already has a filing declaration and the affidavit within that was                                                              
included in order to simplify the application and reporting                                                                     
CHAIR JAMES inquired as to the rationale behind allowing a                                                                      
candidate to file to run and then allowing 15 days to file the                                                                  
conflict of interest statement.  Is it to make filing easier or is                                                              
it for last-minute filers?  She wondered if filing the conflict of                                                              
interest at the same time as the declaration of office is                                                                       
Number 194                                                                                                                      
BROOK MILES, Regulation of Lobbying, Alaska Public Offices                                                                      
Commission, Department of Administration, explained that the filing                                                             
of the financial disclosure statement has been required to be                                                                   
simultaneous with the declaration for office since it was first                                                                 
voted into law in 1974.  Ms. Miles further explained a candidate                                                                
files his/her declaration simultaneously with his/her financial                                                                 
disclosure statement.  Fifteen days after that the candidate is                                                                 
required to file a registration as a candidate providing his/her                                                                
campaign address, treasurer and chairman.                                                                                       
CHAIR JAMES asked what was she was rushing to get done in the 15                                                                
days after she filed.                                                                                                           
MS. MILES replied it would have been the registration statement                                                                 
which asks for the name of the candidate's campaign, the mailing                                                                
address for the campaign, the name of the treasurer or deputy                                                                   
treasurer which can be amended throughout the campaign.  The                                                                    
registration statement also includes the depository if the                                                                      
candidate intends to spend more than $5,000 during the course of                                                                
the campaign.  She noted that information is required within 15                                                                 
days after filing a state declaration or 7 days after a municipal                                                               
candidate files for office.  She mentioned that many incumbents                                                                 
already have their statement on file therefore, this would be of no                                                             
concern when the candidate files his/her declaration.  Frequently,                                                              
an incumbent legislator does not file for office until near the end                                                             
of session or after the end of session.  If an annual filer wishes                                                              
to file a declaration before filing his/her annual financial                                                                    
disclosure then those have to be filed at the same time which                                                                   
could occur any time after January 1 before the financial due date                                                              
of March 15.                                                                                                                    
Number 269                                                                                                                      
REPRESENTATIVE COGHILL mentioned when he filed as a new candidate                                                               
he was not aware of all the deadlines and the different reports                                                                 
that were required.  He said he may have failed to submit a report                                                              
which he thought he had already submitted.  Representative Coghill                                                              
explained that he is trying to make sure that when a person                                                                     
considers filing for office all that information is available.                                                                  
Representative Coghill further stated, "And it may be that, that                                                                
particular day you go down to get the application, you may not file                                                             
and I understand it could be burdensome if you wait until the last                                                              
minute.  But I don't know if we want to accommodate that, I would                                                               
rather have the simplicity of having all the filing in one place                                                                
and one starting place so that once you do start, it's very clear                                                               
to not only to the division, but it's also very clear to the                                                                    
public. ...there is probably a little more burden borne by the                                                                  
candidate, but I think in the interest of a clear start and a clear                                                             
declaration, I think that the voters would be served by it."                                                                    
CHAIR JAMES mentioned that an earlier draft did not include a                                                                   
provision for the intent to file.  That previous draft did not                                                                  
allow any kind of a "war chest" or taking of any contributions from                                                             
anyone until the declaration of a candidacy and the conflict of                                                                 
interest statement had been filed.  Does the new version maintain                                                               
those provisions?                                                                                                               
REPRESENTATIVE COGHILL replied yes.                                                                                             
Number 307                                                                                                                      
CHAIR JAMES inquired as to why there is an intent to file.  If an                                                               
individual has an intent to file, that individual can collect                                                                   
money.  What would happen to the money, if the individual decided                                                               
not to file?  Can anybody file an intent to file?                                                                               
MS. MILES  informed Chair James that anyone can file and can raise                                                              
and expend money.                                                                                                               
CHAIR JAMES asked Ms. Miles what the general benefit of that is                                                                 
because SSHB 179 does not include such.                                                                                         
MS. MILES explained that it is just a convenience for filers                                                                    
because an intent to file temporarily takes the place of a                                                                      
declaration.  She understood with state campaigns, it is not such                                                               
an issue because a person can file a declaration for office                                                                     
whenever they are ready to file that for the next election.  She                                                                
commented that the representative from the Division of Elections                                                                
may have further explanation.  She further explained, "But in the                                                               
municipal races, which is where we first started using the letter                                                               
of intent, the time period where the filing is open with the city                                                               
clerk is often very close to the election day, 60 days away or                                                                  
something.  And in some of the larger communities where the races                                                               
are very competitive that was viewed as an insufficient, even if                                                                
you filed on that first day, it was an insufficient time for                                                                    
running a competitive campaign.  And so we had a letter of intent                                                               
for municipal only, that would permit them to begin their fund                                                                  
raising earlier.  Of course the letter of intent originally was all                                                             
in place before the campaign finance reform was enacted by the                                                                  
legislature, but established more clearly and now it's more clearly                                                             
still, with the supreme court decision - the 18-month prior to the                                                              
election day period."                                                                                                           
Number 359                                                                                                                      
MS. MILES responded to Chair James' question regarding what a                                                                   
candidate should do with the money should the candidate decide not                                                              
to file.  Under current law, any money that a candidate has not                                                                 
spent is disbursed just as any other candidate's campaign is                                                                    
disbursed.  She said, "So, it cannot be taken as personal or used                                                               
as personal."                                                                                                                   
CHAIR JAMES surmised then that SSHB 179, as written, does not                                                                   
provide for an intent to file and suggested Representative Coghill                                                              
may want to review the pros and cons of that.                                                                                   
REPRESENTATIVE COGHILL noted that within the declaration of                                                                     
candidacy there is the application, registration, and conflict of                                                               
interest statement.  He explained the reasoning behind that was to                                                              
provide the general population with a clear idea of whose filed, a                                                              
definite start date, and an affidavit which clarifies that the                                                                  
candidate is qualified.  Representative Coghill acknowledged that                                                               
he had not given much thought to the municipality side of this                                                                  
issue and therefore, would be open to discussion in that area.                                                                  
Number 403                                                                                                                      
CHAIR JAMES indicated that she did not feel comfortable enough with                                                             
current law to sign a statement indicating that she, as the                                                                     
language on page 21 paragraph (4) says, "is familiar with the                                                                   
provisions of this chapter and the penalties for violating a                                                                    
provision of this chapter."  She further indicated the need for                                                                 
candidates to check the list.                                                                                                   
REPRESENTATIVE COGHILL commented that is one of the reasons to have                                                             
a definite starting place, a clear open system of open disclosure                                                               
with less limits.  He clarified that the specified limits relate to                                                             
what a candidate can do with the money as far as personal use in                                                                
order to ensure that there is a clear understanding with regard to                                                              
the candidate's responsibility because the candidate will be held                                                               
to a high degree of accountability.  This is definitely a change                                                                
from the current process.  He reiterated that this change is really                                                             
to provide a better understanding to the general population.  He                                                                
did not know that this process is any more difficult for the                                                                    
candidate, it is merely different.  He added that this is also                                                                  
different for the Division of Elections and APOC.  He explained                                                                 
that taking the limits off giving would eliminate some of the                                                                   
clouds surrounding what is and is not possible.  Once the general                                                               
populace understands that, the public will hold the candidates                                                                  
accountable for that and watch the process.  Currently, even the                                                                
supreme court has difficulties regarding determinations of what can                                                             
and cannot be done due to some of the laws that the legislature has                                                             
CHAIR JAMES commented that campaign finance law has been supported                                                              
so the public does not have to worry about it; the rules are                                                                    
established.  However, Chair James believed that the responsibility                                                             
has been taken away from the public to be responsible about                                                                     
noticing what candidates are doing instead of just believing what                                                               
the newspaper reports.                                                                                                          
Number 469                                                                                                                      
REPRESENTATIVE COGHILL referred to  page 13, Section 21 regarding                                                               
the use of campaign contributions.  He acknowledged the concern                                                                 
that open disclosure and the lifting of some of the limits would                                                                
create "rich people."  That concern resulted in the language in                                                                 
Section 21 which says that campaign contributions cannot be                                                                     
converted for personal income, cannot be loaned, and purchases must                                                             
be at a fair market value (a car cannot be purchased for $10).  He                                                              
said that the candidate needs to be held accountable for that.                                                                  
Representative Coghill pointed out that although this legislation                                                               
includes some major changes, there are many similarities between                                                                
this legislation and the current regulations.  He reiterated the                                                                
need for a clearer process.                                                                                                     
CHAIR JAMES asked if the list of campaign contribution uses in this                                                             
legislation is similar to those in existing law.                                                                                
REPRESENTATIVE COGHILL informed Chair James that the list of                                                                    
campaign contribution uses was taken out of the regulation.  He                                                                 
noted that the legislation attempts to make it as clear as                                                                      
CHAIR JAMES pointed out that this legislation allows candidates to                                                              
spend up to $1,000 to attend political functions; is that                                                                       
REPRESENTATIVE COGHILL replied no.                                                                                              
CHAIR JAMES asked, is that currently allowed?                                                                                   
UNIDENTIFIED SPEAKER replied yes.                                                                                               
Number 513                                                                                                                      
REPRESENTATIVE OGAN indicated that the structure of the limits                                                                  
regarding who can contribute basically eliminates the ability for                                                               
corporations and various groups to contribute.  The language in the                                                             
current legislation would allow the contribution of any amount.                                                                 
Representative Ogan said that the legislation would seem to narrow                                                              
the contributors to a few that control large sums of money that go                                                              
into campaigns versus a broad sphere of influence under which many                                                              
can give money which is of concern.  He also expressed concern with                                                             
the elimination of the limits when people potentially stand to make                                                             
millions on legislation moving through the process.  He said that                                                               
$100,000 is a small price to pay to gain influence over                                                                         
legislation; that is of serious concern and will make corruption                                                                
worse.  Representative Ogan said that he would rather return to                                                                 
opening up who can give while placing a limit on that amount which                                                              
would allow many to give a little.  Such an approach would not seem                                                             
to allow any one person more influence than another person.                                                                     
Representative Ogan believed this legislation would provide a                                                                   
select group of wealthy individuals more influence than desired.                                                                
CHAIR JAMES posed the scenario in which an individual gave a                                                                    
candidate $100,000.  Under the current system, the candidate would                                                              
not have to report the receipt of the money, but the individual                                                                 
would have to report that they gave a gift of $100,000.  The report                                                             
of that $100,000 contribution would probably end up on the front                                                                
page of the newspaper.  She inquired as to what Representative Ogan                                                             
thought the general public's opinion of that candidate would be.                                                                
REPRESENTATIVE OGAN stated that the public seems to be tired of                                                                 
what goes on in politics; the public does not care.                                                                             
CHAIR JAMES inquired then as to why this is being done, if people                                                               
do not care.                                                                                                                    
REPRESENTATIVE OGAN commented that people are jaded and tired of                                                                
the issue.                                                                                                                      
CHAIR JAMES asked if Representative Ogan believed people acted                                                                  
differently under the current law that does not allow an individual                                                             
to give more than $500 versus an individual being allowed to                                                                    
contribute $50,000.  She commented that she would set her own                                                                   
limit, probably a $1,000 to $2,000 contribution from any one                                                                    
REPRESENTATIVE OGAN indicated that there are ways to get around                                                                 
this such as consulting contracts.                                                                                              
CHAIR JAMES asked how a lobbyist would be addressed in this                                                                     
legislation because she did not believe a lobbyist could be denied                                                              
the ability to contribute to a candidate in that lobbyist's own                                                                 
district.  However, she supported not allowing lobbyists to make                                                                
contributions to candidates.                                                                                                    
REPRESENTATIVE COGHILL interjected that prohibition was kept.                                                                   
Number 622                                                                                                                      
CHAIR JAMES commented that the $500 limit is fairly low.  She                                                                   
believed that honorable people would not take large contributions                                                               
which is why she supported not having limits.                                                                                   
REPRESENTATIVE COGHILL recognized that there will always be                                                                     
dishonorable people which is the reasoning behind laws and                                                                      
regulations.  It is also true that the United States is based on                                                                
self-government.  Representative Coghill said that regulating                                                                   
government on the assumption that everyone is a criminal is not                                                                 
appropriate, although there should be provisions for those who act                                                              
criminally.  Placing responsibility on the general populous with                                                                
regard to the no limits giving is important in involving people.                                                                
That resulted in the reporting requirement every 15 days.                                                                       
REPRESENTATIVE COGHILL expressed concern with the Alaska Public                                                                 
Office Commission having regulation-making power, police and                                                                    
judicial-making power simultaneously.  There needs to be a                                                                      
separation of powers as well as an easy linkage to move through the                                                             
reporting process to the judicial process.  Representative Coghill                                                              
commented that he would rather put the public in a position of                                                                  
trust and accountability than the government.  In other arenas,                                                                 
people are not assumed to be criminals first, but rather a law is                                                               
established that if violated would result in going to court.                                                                    
Candidates should have the privilege of an open playing field.                                                                  
Number 0717                                                                                                                     
CHAIR JAMES noted that the notion that someone is innocent until                                                                
proven guilty has been dispelled in many cases.  In other issues,                                                               
Chair James expressed concern with civil penalties for a suspected                                                              
criminal act such as with child abuse.  There have been court                                                                   
decisions that say that it is permissible to have a civil and a                                                                 
criminal penalty on a case and that there is authority for civil                                                                
penalties.  Therefore, Chair James did not know if that issue could                                                             
be won.                                                                                                                         
CHAIR JAMES announced that she would not be appointing a                                                                        
subcommittee on this bill yet, however that may occur next year.                                                                
She offered to meet on these issues during the interim.  Chair                                                                  
James commented that it should be understood that this is a big                                                                 
change and change does not occur in big pieces, but rather small                                                                
REPRESENTATIVE OGAN agreed with Chair James comments.                                                                           
[SSHB 179 WAS HELD OVER.]                                                                                                       

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