Legislature(1995 - 1996)
02/01/1996 09:10 AM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SPONSOR SUBSTITUTE FOR SENATE JOINT RESOLUTION NO. 14 Proposing amendments to the Constitution of the State of Alaska relating to confirmation of appointments of public members who serve on a board or commission involved with managing the assets of the Alaska permanent fund. [Tape malfunction. The following portion of the meeting was not recorded. Minutes reflect transcription of shorthand notes.] Co-chairman Halford directed that SSSJR 14 be brought on for discussion and explained that while the original resolution applied to a number of public corporations, the sponsor substitute deals only with the permanent fund board. He noted the inherent irony in the fact that the legislature confirms appointments to the board of barbers and hairdressers but does not confirm appointment of those who oversee management of the state's $15 billion savings account. Senator Donley voiced his belief that the broader reach of the original resolution was worth consideration. He expressed need for a legal opinion covering all corporations that manage state assets. He also noted need for a definition of "state asset" and recommended first defining the term and then passing the resolution. He suggested that a state assets consists of tangible property or a block of money under a particular agency's control. Senator Rieger advised he was comfortable with the original version of the resolution but concurred in need for statutory definition of "state asset." JIM BALDWIN, Assistant Attorney General, Governmental Relations Section, Dept. of Law, again came before committee. He confirmed that the sponsor substitute narrows the scope of the original resolution and stressed that some public corporations have corporate rather than state assets. The power of appointment is an executive branch function. The resolution goes beyond the constitutional division of powers between the branches. Co-chairman Halford explained that he simplified SSSJR 14 because of difficulties and questions raised by the original. A super majority is needed to achieve consensus for a constitutional amendment. He then queried members regarding whether the resolution should address only the permanent fund board or other major corporations that handle "billions of dollars in state assets" and operate totally outside the appointment and confirmation process. Co- chairman Frank voiced support for the original. Senator Donley reiterated need for a legal opinion defining what constitutes a state asset versus a corporate asset. Co- chairman Frank suggested that it would be difficult to infer that a state-owned corporation does not consist of state- owned assets. Senator Donley concurred but noted that there may be instances where provisions within the articles of incorporation insulate the state from lawsuits or liability for actions of the public corporation. Senator Zharoff inquired concerning the current definition of "cause." Mr. Baldwin informed members that removal for cause generally involves the offense of moral turpitude unless removal for incompetence or inattention to duty is expressly stated. Application differs from board to board. The permanent fund statute states that the governor may remove a trustee by merely stating his reasons in writing. That is, in essence, an at-pleasure appointment. In the course of further discussion of for-cause removal, Mr. Baldwin referenced a past conflict between 39.05.080 (a general right to remove at pleasure) and appointments to the board of fisheries. The legislature subsequently removed the ambiguity. Mr. Baldwin concurred that if the statute for a particular board is silent, everyone serves at the pleasure of the governor. When again queried by the Co-chairman regarding whether the resolution should be restricted to the permanent fund or cover a number of public corporations, Senator Randy Phillips voiced support for broad application. Both Senator Zharoff and Senator Donley reiterated need for definition of "state asset." Co-chairman Halford acknowledged that the definition is inherent in expanded coverage of the resolution. He then directed that SSSJR 14 be further reviewed by himself, Senator Donley, and Senator Rieger. SSSJR 14 was thus held in subcommittee.
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