Legislature(2007 - 2008)BELTZ 211

01/22/2007 01:30 PM Senate JUDICIARY


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ SB 19 EXEC. BRANCH ETHICS:INTERESTS & ACTIONS TELECONFERENCED
Heard & Held
*+ SB 20 LEGISLATIVE DISCLOSURES TELECONFERENCED
Heard & Held
*+ SB 13 BAN CONSULTING CONTRACTS WITH LEGISLATORS TELECONFERENCED
Heard & Held
                 SB  20-LEGISLATIVE DISCLOSURES                                                                             
                                                                                                                                
2:02:40 PM                                                                                                                    
CHAIR HOLLIS  FRENCH announced SB  20 to be up  for consideration                                                               
and read the following sponsor statement into the record:                                                                       
                                                                                                                                
     SB  20 is  a  simple bill  designed  to clarify  Alaska                                                                    
     Public    Offices     Commission    (APOC)    reporting                                                                    
     requirements   for   legislators   and   other   public                                                                    
     officials.                                                                                                                 
                                                                                                                                
     Under  the current  legislative  ethics  code a  public                                                                    
     official  must   disclose  the   nature  of   any  work                                                                    
     performed as  personal services for  which compensation                                                                    
     greater  than $1,000  is received.  SB  20 simply  adds                                                                    
     language to  the existing statute to  require the filer                                                                    
     to provide  a substantive description of  what was done                                                                    
     for the contract, as well  as the approximate number of                                                                    
     hours spent.                                                                                                               
                                                                                                                                
     The   public   has   repeatedly   appealed   for   more                                                                    
     substantive  disclosures,   and  SB  20   provides  the                                                                    
     increased  degree of  openness  they  are calling  for.                                                                    
     This  will  assure  the public  that  the  compensation                                                                    
     public  officials receive  for  outside  work does  not                                                                    
     conflict in  any way with their  public duties, without                                                                    
     unduly  burdening   citizen  legislators   who  perform                                                                    
     legitimate duties outside of the public realm.                                                                             
                                                                                                                                
     The  clarification the  bill  provides  will also  help                                                                    
     APOC fulfill  its mission  of encouraging  the public's                                                                    
     confidence in their elected and appointed officials.                                                                       
                                                                                                                                
CHAIR FRENCH related  that on page 2, lines 3  and 4 add dividend                                                               
income received from a limited  liability company to the types of                                                               
income that must be reported. Also  page 2, lines 6 through 9 add                                                               
the  requirement that  the services  performed must  be described                                                               
such that  a person  of ordinary understanding  is able  to grasp                                                               
what  was done,  outside  the Legislature,  in  exchange for  the                                                               
money  that  was  received.  Page  2, lines  10  and  11  require                                                               
reporting the number of hours  spent performing the service. That                                                               
way  the public  is able  to cross-reference  and thereby  decide                                                               
whether the remuneration  is market based. Finally,  page 2, line                                                               
12 outlines  that the amount  of income received from  the source                                                               
must  be  disclosed  if  the  recipient  is  a  legislator  or  a                                                               
legislative director.                                                                                                           
                                                                                                                                
Section 2  adds a definition  for "professional license"  to mean                                                               
one that  is required for  a profession  regulated by a  state or                                                               
the federal  government. Lists of such  professions are published                                                               
and readily available.                                                                                                          
                                                                                                                                
Basically, the disclosure  is increased so that  anyone who reads                                                               
the statement is  able to determine what the  legislator is doing                                                               
in exchange  for the money  that he  or she is  receiving outside                                                               
the Legislature.                                                                                                                
                                                                                                                                
CHAIR  FRENCH recognized  Brooke  Miles and  noted  that she  was                                                               
available to answer questions.                                                                                                  
                                                                                                                                
2:05:20 PM                                                                                                                    
BROOKE   MILES,  Executive   Director,   Alaska  Public   Offices                                                               
Commission (APOC), said  she did not have anything to  add to the                                                               
bill  overview   and  reminded  members   that  it  is   not  the                                                               
commission's  policy to  support or  oppose legislative  changes.                                                               
However, everyone appreciates  when there is an  effort to codify                                                               
clarification  to existing  language that  has been  difficult to                                                               
interpret. This measure does just that, she said.                                                                               
                                                                                                                                
Section  1 makes  it clear  that dividend  income from  a limited                                                               
liability company  must be reported on  the legislative financial                                                               
disclosure statement.  It also clarifies  that when  a legislator                                                               
or  a legislative  director receives  income from  a professional                                                               
service,  a   detailed  description  of  the   services  must  be                                                               
provided. She  noted the  zero fiscal note  and said  the measure                                                               
would make it easier for APOC administer.                                                                                       
                                                                                                                                
2:07:01 PM                                                                                                                    
CHAIR  FRENCH said  he had  two questions.  First, he  questioned                                                               
whether it  might be useful to  set a threshold, such  as $1,000,                                                               
for disclosing dividend income from a limited liability company.                                                                
                                                                                                                                
MS. MILES said  she presumed the threshold would  be $1,000 since                                                               
Alaska voters  established the  $1,000 threshold  for legislative                                                               
disclosure in the 2006 primary.                                                                                                 
                                                                                                                                
CHAIR FRENCH said  he would prepare an amendment  to address that                                                               
point.                                                                                                                          
                                                                                                                                
He asked  Ms. Miles  to explain  the "unless  clause" on  page 2,                                                               
lines 8 and 9 that provides  an exception if the services require                                                               
issuance of a state or federal professional license.                                                                            
                                                                                                                                
MS.  MILES  related  that  some  services,  such  as  analyst  or                                                               
consultant,  are broadly  defined and  the idea  is to  make more                                                               
information available  to the  public in  those broader  areas of                                                               
self  employment.  The intent  is  not  to add  requirements  for                                                               
professions that already report payments in excess of $1,000.                                                                   
                                                                                                                                
CHAIR  FRENCH  summarized  that  if  the work  that  is  done  is                                                               
pursuant to a  state license, then no further  description of the                                                               
services provided is necessary. However,  if the services fall in                                                               
the broader realm of consultant,  advisor, or analyst, then there                                                               
is need for  a more complete description of what  is done for the                                                               
money.                                                                                                                          
                                                                                                                                
MS. MILES agreed.                                                                                                               
                                                                                                                                
2:10:44 PM                                                                                                                    
SENATOR GENE  THERRIAULT asked Ms.  Miles to comment on  the fact                                                               
that  on page  2,  paragraphs (2)(A),(B),  and  (C) disclose  the                                                               
basic information, but  do nothing to address whether  or not the                                                               
compensation is outrageous.                                                                                                     
                                                                                                                                
MS. MILES  agreed that the  bill does  not place control  on that                                                               
issue, but  a section  of the legislative  ethics laws  speaks to                                                               
employment being  commensurate to the  amount paid. APOC  has the                                                               
disclosure and  provides the  information for  the public  so the                                                               
hours  that are  reported  would  provide a  useful  tool to  the                                                               
Legislative Ethics  Committee in  the event  that a  complaint is                                                               
filed. She advised that Joyce  Anderson could better address that                                                               
question.                                                                                                                       
                                                                                                                                
SENATOR  THERRIAULT said  understanding  how  this section  works                                                               
with the other  section may satisfy that concern,  but the public                                                               
might still find the disclosed information upsetting.                                                                           
                                                                                                                                
CHAIR FRENCH closed public testimony  and announced he would hold                                                               
SB  20  until  Wednesday.  He  noted that  he  would  prepare  an                                                               
amendment to page  2, lines 3 and 4 and  Senator Therriault might                                                               
offer one as well.                                                                                                              

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