Legislature(2001 - 2002)

05/08/2002 08:08 AM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 531 - ELECTIONEERING COMMUNICATIONS/DISCLOSURES                                                                            
                                                                                                                                
[Contains discussion of SB 363 and HB 177]                                                                                      
                                                                                                                                
Number 2224                                                                                                                     
                                                                                                                                
CHAIR  COGHILL  announced that  the  committee  would resume  the                                                               
hearing   on  HOUSE   BILL   NO.  531,   "An   Act  relating   to                                                               
communications and  elections, to reporting of  contributions and                                                               
expenditures, and  to campaign misconduct  in the  second degree;                                                               
relating  to  disclosure  by   individuals  of  contributions  to                                                               
candidates; and providing for an effective date."                                                                               
                                                                                                                                
Number 2299                                                                                                                     
                                                                                                                                
REPRESENTATIVE  CRAWFORD  made a  motion  to  adopt Amendment  1,                                                               
which read:                                                                                                                     
                                                                                                                                
     Page 2, line 17:                                                                                                           
          Delete "advertising"                                                                                                  
          Insert "communication [ADVERTISING]"                                                                              
                                                                                                                                
There being no objection, Amendment 1 was adopted.                                                                              
                                                                                                                                
Number 2375                                                                                                                     
                                                                                                                                
REPRESENTATIVE  CRAWFORD  made a  motion  to  adopt Amendment  2,                                                               
which read:                                                                                                                     
                                                                                                                                
     Page 4, line 17, following "candidate":                                                                                    
        Insert "or proposition, as that term is defined                                                                         
          in AS 15.13.065(c)"                                                                                                   
                                                                                                                                
CHAIR COGHILL objected.                                                                                                         
                                                                                                                                
Number 2460                                                                                                                     
                                                                                                                                
REPRESENTATIVE FATE  asked what  inserting "proposition"  does to                                                               
the intent of the bill.                                                                                                         
                                                                                                                                
Number 2484                                                                                                                     
                                                                                                                                
MS.  MILES  answered  that current  law  requires  all  political                                                               
communication with  respect to candidates or  ballot propositions                                                               
to   be   reported.     With   the   change  in   language   from                                                               
"advertisement" to  "communication", the specification  of ballot                                                               
proposition  being  included  was  left off.    Amendment  2,  as                                                               
proposed,  would  make  sure   that  communications  intended  to                                                               
influence  the outcome  of  a ballot  question  are included  and                                                               
subject to the law.                                                                                                             
                                                                                                                                
Number 2535                                                                                                                     
                                                                                                                                
MR. BALASH  noted that there may  be a similar amendment  to this                                                               
on the Senate floor [to SB 363, the bill similar to HB 531].                                                                    
                                                                                                                                
Number 2552                                                                                                                     
                                                                                                                                
The objection  was removed.   There  being no  further objection,                                                               
Amendment 2 was adopted.                                                                                                        
                                                                                                                                
Number 2588                                                                                                                     
                                                                                                                                
REPRESENTATIVE  CRAWFORD asked  Mr. Balash  to explain  "nongroup                                                               
entity".                                                                                                                        
                                                                                                                                
Number 2620                                                                                                                     
                                                                                                                                
MR. BALASH  explained that  some of these  statutes appear  as if                                                               
nongroup  entities are  not included,  and that  is because  when                                                               
Legislative  Legal prepares  for the  upcoming session,  it deals                                                               
with  the statutes  as they  read on  the first  day of  session.                                                               
Because HB 177 was vetoed by  the governor and then overridden by                                                               
the legislature  after session  had begun [in  2001], all  of the                                                               
files  and databases  Legislative Legal  was working  from didn't                                                               
include those changes from HB  177.  Instead of Legislative Legal                                                               
trying to keep up on the  statutes in real time, it simply throws                                                               
down  a line  of demarcation  and  works from  there through  the                                                               
course  of the  session.   There are  statutes in  place for  the                                                               
revisor  to deal  with these  issues.   In no  way are  nongroups                                                               
expected  or  anticipated  to  be  excluded  from  any  of  these                                                               
requirements.                                                                                                                   
                                                                                                                                
REPRESENTATIVE CRAWFORD referred to page  4, line 16, and said he                                                               
thought "nongroup  entity" should  be deleted  unless there  is a                                                               
good reason not to.                                                                                                             
                                                                                                                                
MR.  BALASH  explained  that the  reason  nongroup  entities  are                                                               
excluded in that  particular case is due to a  U.S. Supreme Court                                                               
decision  [McIntyre v.  Ohio Elections  Comm'n]  that involved  a                                                             
situation in Ohio where there  was a school bond proposition, and                                                               
a grandmother  wanted to do  her part  to support the  efforts of                                                               
the school district to get the  bonding measure passed.  She made                                                               
a  flyer and  passed it  out,  but she  didn't put  a "paid  for"                                                               
statement on it.  Under Ohio's  election laws, she is required to                                                               
do that.   The ACLU  [American Civil Liberties Union]  helped her                                                               
challenge it all the way through  the Supreme Court.  The Supreme                                                               
Court said in that situation, her  speech did not in any way pose                                                               
a  threat  or have  an  appearance  of  corruption.   She  wasn't                                                               
dealing  with  a  public  official,  and  the  communication  was                                                               
initiated by  her and was also  limited - it wasn't  a $50,000 ad                                                               
campaign.   The court has  said that expenditures that  are minor                                                               
in dollar value and are initiated  by an individual don't have to                                                               
be regulated.   They can fall  under the First Amendment  and get                                                               
some  additional protection.    The  ad has  to  be  placed by  a                                                               
nongroup entity  and cost less than  $500.  He noted  that any ad                                                               
placed in the newspapers around  the state or any direct mailings                                                               
will cost more than $500.                                                                                                       
                                                                                                                                
Number 2800                                                                                                                     
                                                                                                                                
REPRESENTATIVE CRAWFORD  referred to the example  Mr. Balash just                                                               
used and asked if "individual"  wouldn't cover that.  He wondered                                                               
if  a nongroup  entity was  like  Common Sense  [for Alaska]  and                                                               
would it be excluded.                                                                                                           
                                                                                                                                
MR. BALASH  replied whether or  not Common Sense for  Alaska fits                                                               
the definition  of a  nongroup entity is  unclear at  this point.                                                               
In HB  177, a nongroup entity  was defined by a  three-part test:                                                               
it cannot  engage in business,  its assets  do not belong  to any                                                               
shareholders, and it's  not under the influence of  business.  If                                                               
Common  Sense for  Alaska wanted  to make  expenditures during  a                                                               
campaign  season,  it  would  have  to  demonstrate  that  it  is                                                               
insulated from the influence of business.                                                                                       
                                                                                                                                
REPRESENTATIVE  CRAWFORD said  he  wasn't sure  what a  nonentity                                                               
group is  and how it's defined.   He wondered if  the District 22                                                               
Democrats, Common  Sense for Alaska,  or other  issue-type groups                                                               
are nongroup  entities.  It seems  to him if they're  going to be                                                               
included in HB 177, they should be included in HB 531.                                                                          
                                                                                                                                
Number 2903                                                                                                                     
                                                                                                                                
MS. MILES  acknowledged that the  commission staff has  also been                                                               
trying to  figure out  exactly what  a nongroup  entity is.   She                                                               
reported that there  are none registered.   Previously, there was                                                               
a regulation  providing for  qualified nonprofit  corporations to                                                               
participate in elections  in a manner similar  to individuals but                                                               
with  the  giving  power  of  a   group.    There  was  only  one                                                               
association  that  had  qualified   and  participated,  and  that                                                               
resulted in  a significant  amount of controversy.   In  the past                                                               
legislative session,  HB 177  was passed  which changed  that and                                                               
described  a  nongroup  entity  "as  a  'person'  other  than  an                                                               
individual that  takes action  the major purpose  of which  is to                                                               
influence  the outcome  of an  election and  that meets  the same                                                               
three-part  test described  by  the  court in  ACLU  v. State  of                                                             
Alaska following campaign  finance reform.  That  is, they cannot                                                             
participate   in   business   activities,  they   do   not   have                                                               
shareholders who  have a  claim on  corporate earnings,  and that                                                               
they're independent from the influence of business."                                                                            
                                                                                                                                
MS. MILES pointed  out that under the new  guidelines provided in                                                               
HB  177,   these  nongroup  entities  could   register  with  the                                                               
commission and then have the  same giving power as an individual.                                                               
Commission  staff  doubts there  will  be  any nongroup  activity                                                               
because  it makes  more sense  for these  associations to  form a                                                               
standard political action committee.                                                                                            
                                                                                                                                
TAPE 02-54, SIDE B                                                                                                              
Number 2990                                                                                                                     
                                                                                                                                
MS.  MILES  said  the  political   action  committee  may  accept                                                               
contributions and then  give up to $1,000 to a  candidate.  These                                                               
nongroup  entities  are  small associations  informally  combined                                                               
that may wish to combine money  and support a candidate.  Because                                                               
their giving  level is only  half of  that of a  political action                                                               
committee and  their limitations  and restrictions are  the same,                                                               
it really wouldn't  make sense for someone to go  that route, she                                                               
noted.                                                                                                                          
                                                                                                                                
Number 2965                                                                                                                     
                                                                                                                                
CHAIR COGHILL  said that pulling  [nonentity groups] out  in this                                                               
amendment still doesn't change the conundrum.                                                                                   
                                                                                                                                
MS. MILES  agreed that that  issue would  still have to  be dealt                                                               
with.                                                                                                                           
                                                                                                                                
Number 2849                                                                                                                     
                                                                                                                                
MR.  BALASH pointed  out that  in HB  177, the  nongroup entities                                                               
consistently  throughout the  statute  are treated  in a  similar                                                               
fashion to individuals,  and that's why they're  mentioned in the                                                               
same  breath  as  an  individual  in this  case;  that  was  done                                                               
deliberately.                                                                                                                   
                                                                                                                                
[Representative Crawford  did not  offer other amendments  he had                                                               
prepared.]                                                                                                                      
                                                                                                                                
Number 2777                                                                                                                     
                                                                                                                                
REPRESENTATIVE FATE  moved to report  HB 531, as amended,  out of                                                               
committee  with individual  recommendations and  the accompanying                                                               
fiscal  notes.   There being  no objection,  CSHB 531(STA)  moved                                                               
from the House State Affairs Standing Committee.                                                                                

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