Legislature(2005 - 2006)BUTROVICH 205
05/01/2005 04:00 PM JUDICIARY
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SB 186-EXECUTIVE BRANCH ETHICS For the purpose of research, it is important to review minutes st and recordings of SB 127 one May 1, 2005 where the two bills were distinctly compared. CHAIR RALPH SEEKINS announced his intent to merge SB 127 into SB 186. He asked Ms. Barbara Richey whether she had concerns with SB 186. MS. BARBARA RICHEY, chief assistant attorney general, Department of Law (DOL), said SB 186 does a good job of indicating what constitutes a significant personal or financial interest in a matter. The changes in confidentiality work well. CHAIR SEEKINS moved Version \I as the working document. Hearing no objections, the motion carried. 7:13:29 PM MS. RICHEY continued SB 186 does not dramatically change current law on confidentiality of executive branch ethics matters. It sets up a mechanism for the steps in the event of an allegation of ethics violation in regards to the governor, the lieutenant governor, and the attorney general. She said it was an improvement to the current ethics law. 7:15:02 PM CHAIR SEEKINS asked Ms. Richey how long she has worked with the current law. MS. RICHEY informed she has headed up her section for two years and has worked in ethics matters prior to that. CHAIR SEEKINS asked Ms. Richey to explain her concern with the effective date. MS. RICHEY said she would like to have an opportunity to do some training on the changes because they are significant. She would like people to have a chance to review their financial holdings. There may also need to be some regulatory changes as well. 7:16:37 PM MS. RICHEY added the law from 1986 until 1998 identified violation of the confidentiality provisions of the Ethics Act as a class A misdemeanor. Legislators in 1998 felt it was too harsh a penalty and so they took it out. CHAIR SEEKINS advised he was going to advance a conceptual amendment. On Page 1, line 8; reduce the penalty for disclosure of ethics violation to a $5,000 fine. He would leave it to the drafters to determine whether that would be a new section of the bill. He asked Ms. Richey to read the statute regarding the penalty that the personnel board may impose on current or former public officers. 7:18:41 PM MS. RICHEY said the Ethics Act itself is not a criminal statute. The civil penalty that may be imposed is not to exceed $5,000. CHAIR SEEKINS stated that would include confidentiality sections. MS. RICHEY looked at Oregon law and said they have a civil penalty for violation of confidentiality provisions. It reads, "any person aggrieved as a result of violation of this paragraph by a member of the ethics commission or it's staff may file a petition in court in the judicial district where the petitioner resides in order to enforce a civil penalty provided in this section." 7:20:53 PM CHAIR SEEKINS speculated the intent was the aggrieved person could now bring into the process a person who was not a member of the personnel board or the attorney general's office. SENATOR FRENCH said his analysis is that in Oregon a person could sue a member of our equivalent of the personnel board if one of those members leaks to the press. MS. RICHEY agreed. 7:22:55 PM SENATOR THERRIAULT asked the process previous to 1998. MS. RICHEY advised the Ethics Act was enacted in 1986 and the misdemeanor provision was in the bill since the beginning. 7:24:06 PM CHAIR SEEKINS reiterated his intent was to allow the appropriate public entity to impose up to $5,000 penalty. 7:25:58 PM SENATOR FRENCH assumed the enforcement mechanism would lie in the attorney general's office. CHAIR SEEKINS said yes. MS. RICHEY agreed. Under current law the personnel board could impose a penalty for violation of the chapter and the chapter is the entire Ethics Act. It may be possible to give the personnel board jurisdiction if the complainant is not a public officer. CHAIR SEEKINS conceptually proposed to ask the drafters to add a new section to AS 39.52.440 that allows the board the authority to impose a fine on any person who violates the confidentiality requirements of the statute. So a person could be fined $5,000 on other violations and also $5,000 fine for violating the confidentiality portions. 7:29:30 PM SENATOR FRENCH disagreed. The personnel board would not have jurisdiction over a citizen who files a complaint. CHAIR SEEKINS said in the case of someone who is not a public officer then authority would be given to the DOL. SENATOR FRENCH disagreed with the fundamental approach of the amendment. There has only been one flagrant violation of confidentiality in recent history. 7:31:12 PM MS. RICHEY said currently when a complaint is filed the complainant and the subject of the complaint are always advised the complaint is confidential under law. CHAIR SEEKINS stated a complaint must be in writing and under oath. MS. RICHEY agreed. CHAIR SEEKINS asked whether there was an actual form that is filed. MS. RICHEY said it was under oath. CHAIR SEEKINS asked whether there was anything in statute that bars the complainant from disclosing they are filing an ethics report before they actually file the complaint. MS. RICHEY said no. What is confidential right now is the complaint and the investigation. SENATOR FRENCH noted current law says the attorney general and all persons contacted during the course of an investigation shall maintain confidentiality regarding the existence of the investigation. He said the law is clear the investigations are confidential. 7:35:11 PM CHAIR SEEKINS reiterated his earlier conceptual amendment. Hearing no objections, Amendment 1 was adopted. SENATOR HUGGINS asked Senator French his reservations in the blind trust area. SENATOR FRENCH said the concern is when a person puts an asset into a blind trust and then later makes a decision that affects the stock in the account. As it is now, a person has too much access to their investments and could make decisions based on those assets. 7:38:22 PM CHAIR SEEKINS said he would be more nervous putting money into an account where he had no control. At least a blind trust has more fiduciary responsibilities on the part of the trustee. 7:43:59 PM CHAIR SEEKINS asked for further amendments. SENATOR FRENCH offered a conceptual amendment having to do with the length of time the assets are in a blind trust and a set of restrictions an officer sends along with his/her investments. The assets would have to be in a blind trust for six months or greater and the management control would be something similar to what Attorney General Marquez did to put his assets out of his control. CHAIR SEEKINS asked if he wanted to apply that standard to all twenty thousand state employees. SENATOR FRENCH clarified he was trying to avoid a public officer making decisions based on their investments and not on the public good. CHAIR SEEKINS said he would consider Amendment 3, which would read, "...after consulting with the public officers designated ethics supervisor the financial interest in a matter is held in a blind trust where the public officer does not have management control over the financial interest." 7:48:03 PM MS. RICHEY advised the committee they were considering proposed amendments to AS 39.52.110 and that is a section that provides overall guidance to the code of ethics. She assured the committee that section is followed properly. Chair Seekins announced a brief recess at 7:50:48 PM. Chair Seekins reconvened the meeting at 7:57:12 PM. CHAIR SEEKINS advised he wants to work with Senator French to craft a good bill. His experience with broker managers is a person could place restrictions on what the broker can buy. 7:58:18 PM SENATOR FRENCH said it might be easier to do by developing a set of forms for each state department. CHAIR SEEKINS agreed that could be done. 7:59:46 PM MS. RICHEY noted Section 8, sub-paragraph (A), and asked the reason for the changes. CHAIR SEEKINS answered they directly relate to financial investments. MS. RICHEY argued that is true for sub-paragraph (B) but not (A). She recommended the committee leave "personal or" in sub- paragraph (A). There can be a situation where people are on a board and if they resign from that board it is a personal type interest. 8:02:06 PM SENATOR FRENCH withdrew Amendment 2. CHAIR SEEKINS proposed Amendment 3. Insert "personal, or" on Page 4, beginning of line 3. SENATOR THERRIAULT asked Chair Seekins to restate his proposed amendment. MS. RICHEY commented it would allow a designated ethics supervisor to require someone to remove interests. Amendment 3 was adopted unanimously. 8:04:04 PM CHAIR SEEKINS commented Sections 9-13 all deal with the process for the attorney general, the lieutenant governor and the governor. SENATOR FRENCH expressed concern regarding Section 10 and review of the report of the independent counsel. CHAIR SEEKINS interrupted to clarify Section 10 relates to the allegation of complaint. Section 10 lays out the process prior and is used to determine if a complaint should be filed. SENATOR FRENCH speculated a series of newspaper articles could make allegations of ethics violations against the governor, which comes to the attention of the attorney general. The attorney general would ask the personnel board to appoint an independent counsel who would conduct an investigation. A report would be submitted to the attorney general who would review it to decide whether the findings indicate a violation. That stated, he asked why insert the judgment of a political ally of the subject instead of simply handing the completed report over to the personnel board. 8:06:56 PM CHAIR SEEKINS answered he would have as much confidence in the attorney general as he would the politically appointed board. SENATOR HUGGINS aired the fail safe mechanism is nothing precludes a person from filing a complaint concerning the same matter. CHAIR SEEKINS asserted trust must be placed at the attorney general level. 8:09:15 PM SENATOR GUESS commented since the investigation and the conclusion is confidential there would appear no public response or no comment to Senator French's speculated newspaper scenario. CHAIR SEEKINS said more than likely if an independent investigator's report came back to show no violation, someone would make that fact public. In order to stop a public inquiry somebody would have to disclose the result of the investigation. If there was found to be probable cause the matter then becomes public because the attorney general would have to file the complaint. SENATOR GUESS asked at what time does a report of an allegation become an allegation versus just someone's opinion. 8:12:26 PM SENATOR FRENCH answered currently a person has to file a complaint and swear to it. SB 186 doesn't detail how to get the mechanism going. He suggested adding a probable cause standard in the bill for a legal reference. 8:14:43 PM CHAIR SEEKINS asked Ms. Richey her interpretation of the trigger point for the investigation. MS. RICHEY assessed the report part is clear and easy, where a person reports to a supervisor under oath and in writing of a potential violation. She said she would have to think more about allegations and newspaper opinions because it seems to leave it to the discretion of the attorney general or the governor who is each other's designated ethics supervisors under the current law. For the benefit of their own piece of mind and the people of Alaska, they should go to the personnel board and get an independent counsel appointed. 8:17:16 PM CHAIR SEEKINS said his intent was to allow them that discretion. MS. RICHEY said it happened (in former Attorney General Renkes case) and the governor immediately investigated it. SENATOR GUESS referred to Page 6, line 15 and noted there are two campaign periods, one when filing for office and another when filing APOC (Alaska Public Office Commission) papers. She asked which campaign period was referenced. CHAIR SEEKINS responded it would be when a person actually files for office. MS. RICHEY advised "campaign period" is defined in the Ethics Act. 8:20:00 PM SENATOR FRENCH detailed currently an interested party could petition the superior court and the superior court could make the matter public. He asked the reason for taking that power away from the superior court in Section 13. CHAIR SEEKINS said the intent is not to strike the authority of the superior court; it's just not included in the section. SENATOR THERRIAULT commented the drafter dropped it out but it is still included somewhere else. MS. RICHEY explained the superior court process. She added it has never been used. The entire section AS 39.52.335 was added in the 1998 amendments to the law. The concept was to have more oversight of what the attorney general is doing because the attorney general has a lot of power under the Ethics Act to dismiss complaints or proceed with complaints. This is the one that triggered the quarterly reports and the reports to the personnel board that we do every month on what's going on with complaints etc. When the bill shows deleting "the superior court makes the matter public under (h) of this section", before the superior court could ever get involved, you'd have to have a situation where number one, it's a dismissal that is confidential and number two, the personnel board, in their review, decides for whatever reasons that the publication is in the public interest. Then they put in their report a recommendation that the matter be made public. That was in AS 39.52.335(f), which is proposed to be deleted in Section 14 of SB 186. If all those things happened, so that the disposition was not made public and the personnel board report contained recommendation that it be made public, that is when an interested person could go to superior court. They can't just go to superior court because they feel like it. The personnel board first has to decide that this matter should be made public. Then they go to court and the court could order that all of it or parts of it be made public if they determine that the several things that have to be established were. One of those things is "the release of information will not infringe on protected rights", "the matter concerns public interest", and "the resolution was clearly contrary to the requirements of this chapter", those kinds of things. As a matter of practice, when we resolve a complaint through a stipulation, we require that the stipulation be made public so that Alaskans know the law is being enforced and it gives guidance to state employees and to designated ethics supervisors as to what sort of conduct will result in an ethics complaint and enforcement of the law. We try to make all our resolutions of these public. 8:25:42 PM MS. RICHEY summarized the only change that SB 186 would make to AS 39.52.335 is to end the process when there is a dismissal that is not public then that would end it. The personnel board could not recommend that it be made public and the trigger for the superior court to make something public would be removed. SENATOR FRENCH asked Ms. Richey how the personnel board could come to a wrong conclusion about the need to publish a dismissal. MS. RICHEY reiterated there is no history of anybody using AS 39.52.335. 8:27:22 PM MS. RICHEY stated confidence in the handling of the cases. Ones that have substance are made public. 8:29:02 PM SENATOR FRENCH relayed his belief the superior court is a safety valve for if a cover up is happening. He moved Amendment 4. Page 6, line 25 reinsert "superior court makes the matter public under (h) of this section." CHAIR SEEKINS objected. He advised Senator French his motion would also have to repeal the repealer. SENATOR FRENCH added to repeal the repealer and any further adjustments for statute conformity. The idea behind Amendment 4 is to maintain the safety valve of the superior court. Roll call proved Amendment 4 failed with Senators Huggins, Therriault and Chair Seekins dissenting. SENATOR FRENCH noted a section deleted on Pages 6 and 7. He asked Ms. Richey whether that section applied to personnel board issues. MS. RICHEY said it all related to AS 39.52.355 and disposition of complaints by the attorney general's office. 8:33:37 PM SENATOR FRENCH stated for the record he was positive that a citizen of the State of Alaska could not be bound to confidentiality as Section 15 states. CHAIR SEEKINS responded what triggers the violation is somewhat retrospective in that a person has filed the complaint. What he is trying to avoid is someone using ethics violation to harm someone else. SB 186 is an attempt to give somebody the opportunity for a deliberative body to review a complaint before that person is tried by the press. 8:38:00 PM SENATOR FRENCH said he believed the press wasn't generally that interested. The bill is covering a range of violations that are already covered by liable and slander laws. He moved Amendment 5. Page 7, line 18 strike the material "complainant" and remove the rest of the material on lines 20-27 that is bold and underlined. SENATOR THERRIAULT objected. 8:40:54 PM Roll call proved Amendment 5 failed with Senators Huggins, Therriault and Chair Seekins dissenting. MS. RICHEY commented lines 24-27 are about public records cases. SENATOR FRENCH asked the reason for the word changes in Section 19 sub-paragraph (B) (conjugal vs. sexual). CHAIR SEEKINS stated he was trying to reflect a marriage relationship better. MS. RICHEY agreed. She said the words "conjugal" and "cohabit" indicate living in a marital relationship. 8:42:42 PM SENATOR FRENCH proposed Amendment 6. Add a definition for "official action", which would read, "Official action means performance of any duties in the course and scope of a public official's employment including review, advice, participation, assistance, or other kind of involvement regarding a matter such as a recommendation, decision, approval, disapproval, vote, or other similar action including inaction by a public officer." CHAIR SEEKINS objected. 8:44:23 PM Roll call proved Amendment 6 failed with Senators Huggins, Therriault, and Chair Seekins dissenting. 8:46:12 PM MR. MERLE THOMPSON testified in opposition of SB 186. He stated public trust is the reason ethics laws are written. SB 186 seems more concerned with groundless complaints, ruined reputations and financial restriction. It suggests need for more secrecy and punishes the complainant more so than the actual violator. People in public office are supposed to be held to higher standards. 8:48:35 PM MR. THOMPSON continued the class A misdemeanor was applied to members of the committee, not to the general public. He claimed SB 186 was taking away from the system of government and in violation of the First Amendment of the U.S. Constitution. 8:52:47 PM CHAIR SEEKINS alleged there was nothing in SB 186 that would fine a whistleblower. MR. THOMPSON asked whether he would be penalized in the case of if he intended to file a complaint against the attorney general and advised the press of his intentions. CHAIR SEEKINS said it depends on whether he filed that complaint. 8:55:24 PM CHAIR SEEKINS closed public testimony. SENATOR FRENCH suggested there would have been more citizens who would have testified had the hearing been better advertised. He said the public is unaware that the Senate Judiciary Standing Committee is hearing SB 186 today. 8:57:01 PM CHAIR SEEKINS stated SB 186 has been on the daily schedule since last Friday. People will have opportunity to testify at the House hearings. SENATOR THERRIAULT moved CSSB 186(JUD) from committee with individual recommendations and attached fiscal note(s). SENATOR FRENCH objected. Roll call proved Senator French's objection failed. CSSB 186(JUD) passed out of committee with Senator French dissenting.