03/20/2014 09:00 AM Senate STATE AFFAIRS

             HB 262-PROCUREMENT EXEMPTION: PDA, OPA                                                                         
                                                                                                                                
9:09:55 AM                                                                                                                    
CHAIR DYSON announced the consideration of HB 262.                                                                              
                                                                                                                                
9:10:15 AM                                                                                                                    
REPRESENTATIVE LINDSEY HOLMES,  Alaska State Legislature, Juneau,                                                               
Alaska, HB  262 sponsor, said HB  262 was drafted in  response to                                                               
an audit  by the Alaska  Division of Legislative Audit  (ADLA) in                                                               
2012.  She   explained  that  ADLA  audited   the  Department  of                                                               
Administration  (ADA) and  the Office  of Public  Advocacy (OPA).                                                               
She said  OPA was found  not to be  in total compliance  with the                                                               
Alaska Procurement  Code (APC). She set  forth that HB 262  is an                                                               
attempt to make sure OPA is in compliance with APC.                                                                             
                                                                                                                                
REPRESENTATIVE HOLMES  detailed that OPA and  the Public Defender                                                               
Agency (PDA)  are entities  housed within ADA.  She said  OPA and                                                               
PDA  are in  charge of  defending indigent  and poor  Alaskans in                                                               
criminal  cases. She  noted that  OPA and  PDA are  almost always                                                               
opposing  counsel  to  the  Alaska  Department  of  Law's  (ADOL)                                                               
prosecutors.                                                                                                                    
                                                                                                                                
CHAIR DYSON asked what the difference is between OPA and PDA.                                                                   
                                                                                                                                
REPRESENTATIVE HOLMES explained that  PDA acts principally as the                                                               
primary group  and OPA takes  on criminal cases where  the public                                                               
defenders have conflicts.  She added that OPA also  serves in the                                                               
capacity of guardian ad litem.                                                                                                  
                                                                                                                                
9:11:56 AM                                                                                                                    
CHAIR DYSON asked  what the situations are where PDA  has real or                                                               
perceived conflicts of interest.                                                                                                
                                                                                                                                
REPRESENTATIVE  HOLMES  replied  that  the  legal  codes  dictate                                                               
conflict of interest situations.                                                                                                
                                                                                                                                
She explained  that a level playing  field does not exist  in the                                                               
APC for  the PDA  and OPA  versus ADOL.  She said  an inadvertent                                                               
omission was made when the  APC was written where state attorneys                                                               
were not taken into consideration  outside of ADOL. She specified                                                               
that  state  attorneys  exist  in  the ADA  and  noted  that  her                                                               
oversight as  Chair for  ADA's budget  sub-committee precipitated                                                               
her involvement  with HB 262.  She cited an example  were outside                                                               
counsel, conflict  counsel, or expert  witnesses are  hired where                                                               
prosecutors  are   given  APC   spending  exemptions   to  retain                                                               
qualified  experts that  the attorney  general signs-off  on. She                                                               
said  PDA  and  OPA  are  not afforded  the  same  APC  budgetary                                                               
spending exemptions as ADOL.                                                                                                    
                                                                                                                                
She  summarized that  HB 262  creates  a level  playing field  by                                                               
providing  the same  ADOL exemptions  to PDA  and OPA.  She added                                                               
that  PDA  and OPA  directors  will  be  allowed to  sign-off  on                                                               
exemptions   rather  than   requiring   the  attorney   general's                                                               
authorization.  She  pointed out  that  the  attorney general  is                                                               
technically the opposing counsel's boss.                                                                                        
                                                                                                                                
9:14:18 AM                                                                                                                    
SENATOR  COGHILL asked  how long  the inequity  has been  present                                                               
based upon the auditors' findings.                                                                                              
                                                                                                                                
REPRESENTATIVE HOLMES replied that  the audit discovered that the                                                               
PDA  and OPA  did  not  actually realize  that  the inequity  was                                                               
covered by APC. She said the  noncompliance has been going on for                                                               
a while.                                                                                                                        
                                                                                                                                
CHAIR DYSON  remarked that PDA and  OPA were fortunate not  to be                                                               
busted for their actions.                                                                                                       
                                                                                                                                
REPRESENTATIVE HOLMES answered that  the auditors slapped PDA and                                                               
OPA "on the wrists" for their noncompliance.                                                                                    
                                                                                                                                
CHAIR DYSON called attention to the value of good auditors.                                                                     
                                                                                                                                
REPRESENTATIVE  HOLMES  agreed  that  audits  were  an  important                                                               
function.                                                                                                                       
                                                                                                                                
SENATOR COGHILL asked  if the current statute on  contracts up to                                                               
$100,000 were limited to $1,000 exemptions on both sides.                                                                       
                                                                                                                                
9:16:16 AM                                                                                                                    
MIKE   BARNHILL,  Deputy   Commissioner,  Alaska   Department  of                                                               
Administration, Juneau,  Alaska, answered that  Senator Coghill's                                                               
inquiry  pertains to  section  2  of HB  262  which amends  APC's                                                               
limited competition,  AS 36.33.05. He detailed  that the $100,000                                                               
limitation only  applies to construction contracts.  He specified                                                               
that the use of the  limited competition statute for professional                                                               
services has no limitation.                                                                                                     
                                                                                                                                
SENATOR  COGHILL  asked  Mr. Barnhill  to  address  the  question                                                               
previously  posed when  a perceived  conflict occurs  between PDA                                                               
and OPA.                                                                                                                        
                                                                                                                                
MR.  BARNHILL   replied  that  when   the  public   defender  has                                                               
represented a  witness who then  turns out  to be a  defendant or                                                               
vice versa,  conflicts arise due  to the knowledge that  a public                                                               
defender  has with  respect  to the  witness  or the  defendant's                                                               
prior history.                                                                                                                  
                                                                                                                                
9:17:47 AM                                                                                                                    
RICK  ALLEN, Director,  Office of  Public Advocacy  (OPA), Alaska                                                               
Department  of  Administration,  Anchorage,  Alaska,  added  that                                                               
conflict  also arises  when there  are  co-defendants where  each                                                               
individual  requires independent  and conflict  free counsel.  He                                                               
noted  that OPA's  cases are  about  50 percent  criminal and  50                                                               
percent civil.  He explained that  OPA's conflict cases  from PDA                                                               
tend to be big cases where  added witnesses are involved. He said                                                               
civil cases encompass guardian ad  litem for abused and neglected                                                               
kids, public  guardianship for disabled  adults who are  wards of                                                               
the  states, elder-fraud,  and an  appellate unit.  He set  forth                                                               
that HB  262 would assist  OPA in retaining  professionals needed                                                               
to appropriately represent its clients.                                                                                         
                                                                                                                                
CHAIR DYSON asked  if other individuals would like  to address HB
.                                                                                                                            
                                                                                                                                
9:19:45 AM                                                                                                                    
SENATOR  GIESSEL moved  to report  HB  262, labeled  28-LS1222\A,                                                               
from committee with individual  recommendations and attached zero                                                               
fiscal note.                                                                                                                    
                                                                                                                                
9:20:09 AM                                                                                                                    
CHAIR DYSON announced  that without objection, HB  262 passes out                                                               
of the Senate State Affairs Standing Committee.