03/19/2025 01:00 PM House JUDICIARY
| Audio | Topic |
|---|---|
| Start | |
| HB6 | |
| HB118 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 118 | TELECONFERENCED | |
| *+ | HB 6 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE JUDICIARY STANDING COMMITTEE
March 19, 2025
1:02 p.m.
MEMBERS PRESENT
Representative Chuck Kopp, Vice Chair
Representative Ted Eischeid
Representative Genevieve Mina
Representative Sarah Vance
Representative Jubilee Underwood
Representative Mia Costello
MEMBERS ABSENT
Representative Andrew Gray, Chair
COMMITTEE CALENDAR
HOUSE BILL NO. 6
"An Act restricting fiduciary actions by a fiduciary of a state
fund, the Alaska Retirement Management Board, and the Alaska
Permanent Fund Corporation Board that have the purpose of
furthering social, political, or ideological interests."
- HEARD & HELD
HOUSE BILL NO. 118
"An Act establishing the Council on Human and Sex Trafficking;
and providing for an effective date."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 6
SHORT TITLE: STATE FUND FIDUC DUTY:SOCIAL/POL INTEREST
SPONSOR(s): REPRESENTATIVE(s) MCCABE
01/22/25 (H) PREFILE RELEASED 1/10/25
01/22/25 (H) READ THE FIRST TIME - REFERRALS
01/22/25 (H) JUD, FIN
03/19/25 (H) JUD AT 1:00 PM GRUENBERG 120
BILL: HB 118
SHORT TITLE: COUNCIL ON HUMAN AND SEX TRAFFICKING
SPONSOR(s): REPRESENTATIVE(s) VANCE
02/26/25 (H) READ THE FIRST TIME - REFERRALS
02/26/25 (H) JUD, FIN
03/19/25 (H) JUD AT 1:00 PM GRUENBERG 120
WITNESS REGISTER
REPRESENTATIVE KEVIN MCCABE
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As prime sponsor, presented HB 6.
JULIE MORRIS, Staff
Representative Kevin McCabe
POSITION STATEMENT: On behalf of Representative McCabe, prime
sponsor, offered the sectional analysis for HB 6.
KEVIN MITCHELL, Executive Director
Alaska Permanent Fund Corporation
Juneau, Alaska
POSITION STATEMENT: Answered questions during the hearing on HB
6.
BOB BELLANGER, Staff
Representative Sarah Vance
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented the sectional analysis for HB 118
on behalf of Representative Vance, prime sponsor.
KATIE TEPAS, Program Coordinator
Department of Public Safety
Anchorage, Alaska
POSITION STATEMENT: Answered questions during the hearing on HB
118.
ACTION NARRATIVE
1:02:56 PM
VICE CHAIR CHUCK KOPP called the House Judiciary Standing
Committee meeting to order at 1:02 p.m. Representatives Mina,
Vance, Eischeid, Underwood, and Kopp were present at the call to
order. Representative Costello arrived as the meeting was in
progress.
HB 6-STATE FUND FIDUC DUTY:SOCIAL/POL INTEREST
1:03:48 PM
VICE CHAIR KOPP announced that the first order of business would
be HOUSE BILL NO. 6, "An Act restricting fiduciary actions by a
fiduciary of a state fund, the Alaska Retirement Management
Board, and the Alaska Permanent Fund Corporation Board that have
the purpose of furthering social, political, or ideological
interests."
1:04:04 PM
REPRESENTATIVE KEVIN MCCABE, Alaska State Legislature, as prime
sponsor, presented HB 6. He read from the following prepared
remarks [original punctuation provided]:
Again, thank you for hearing HB6. This bill keeps our
Alaska Permanent Fund and State Retirement Fund doing
what they're built formaking money for Alaskans, not
bowing to trendy mandates from across the pond or
anywhere else. Here's why we need it."
1. Pecuniary Duty Is Our North Star
o The Permanent Fund and State Retirement Fund
have one job: grow the pot to fund state government
and the PFD$1,702 per Alaskan last year. That's real
money for real needsroads, schools, heat. HB6 locks
fiduciaries into pecuniary interestmaxing returns, no
detours. Chairman, this is about keeping our funds'
eyes on the prize, not chasing feel-good fluff like
Europe's forcing on their companies.
2. Fossil Fuels PayAnd They're a Lifeline
o "Take Alex Epstein's Moral Case for Fossil Fuels
he nails it: coal, oil, gas keep Alaska and the world
running. Our funds' roots are oil royalties, and
coal's still raking it in8.7 billion tons globally in
2023. HB6 says we don't dump winners, even if they
don't fit the latest social or environmental justice
fad, just for Net Zero hype. It's not just profitit's
what powers our homes and jobs.
3. Europe's DEI Mandate Is a WarningHB6 Is Our Shield
o Over in Europe, they're rolling out ruleslike
that Corporate Sustainability pushforcing companies
to sink cash into DEI and ESG, whether it pays or not.
Worse, they're pressuring those companies to ditch
business with American or Alaskan firms that don't
play along. It's a top-down order to chase alarmist
fads over shareholder value. HB6 says Alaska's not in
that game. We don't let Brussels dictate our funds
divesting coal or propping up diversity quotasto
appease bureaucrats. We stay free, focused on pure
pecuniary returns.
4. ESG and DEI Flops Prove the Point
o Check the track record: ESG and DEI don't
guarantee wins. In 2022, the APF beat benchmarks with
energy bets, while some ESG funds bled 20% chasing
green dreams. Bed Bath & Beyond went big on ESGbust
by '23. DEI's no silver bullet eithercompanies pour
time and money into it, and where's the profit? HB6
keeps us clear of that mess.
5. Virtue Signaling's a Trap for Failing Firms
o Here's a red flag: companies in a holelike
retailers on the ropespivot to ESG or DEI for
headlines and goodwill. It's a Hail Mary that usually
flops. Think of chains slapping 'sustainability' or
'green' on everything, still shutting stores. Our
funds aren't lifelines for losersHB6 ensures we back
winners, not PR stunts
6. Alaska's Not Europe's Guinea Pig
o Norway's fund toys with Net Zero on $1.6
trillionno dividends, no pressure, they can afford
it. Our $80 billion's differentit's for Alaskans now,
funding government and PFDs, not some global
experiment. Europe's mandating DEI spendingfine for
them. HB6 says we don't risk your money on unproven
green tech or social checklists. Coal, firearmsif
they pay, they stay.
7. Today's Cash Beats Tomorrow's Guesses
o Some say coal's doomedclimate rules, market
shifts. Maybe someday. Right now, it's kingenergy
stocks carried us in 2022. Epstein's right in The
Moral Case: fossil fuels fix more than Net Zero
prevents. We need to look unemotionally at the data,
at the profits, and invest for that. HB6 keeps us
grounded: don't ditch winners for 'what-ifs.' If the
tide turns, we'll adjustwithout Europe's forced DEI
playbook.
o Chairman Gray, committeeHB6's our stand: funds
that deliver for Alaska, not dancing to Europe's tune
or betting on trendy flops. You know a dollar earned
beats a dollar flashed for clout. This bill's that
promise. I'd appreciate your support.
1:10:12 PM
JULIE MORRIS, Staff, on behalf of Representative McCabe, prime
sponsor, offered the sectional analysis for HB 6, which read as
follows [original punctuation provided]:
Section 1 amends AS §37.10.071 to require fiduciaries
of state funds to prioritize the financial interests
of beneficiaries when investing public funds. This
prohibits consideration of social, political, or
ideological factors in investment decisions.
Section 2 amends AS §37.10.220 to require the Alaska
Retirement Management board to prioritize the
financial interests of beneficiaries when investing
public funds. This prohibits consideration of social,
political, or ideological factors in investment
decisions.
Section 3 amends AS §37.10.220 to require the Alaska
Permanent Fund Corporation board to prioritize the
financial interests of beneficiaries when investing
public funds. This prohibits consideration of social,
political, or ideological factors in investment
decisions.
1:11:50 PM
VICE CHAIR KOPP asked for an example of Alaska's fiduciaries
prioritizing an ideological goal over financial returns.
1:12:23 PM
REPRESENTATIVE MCCABE shared his belief that neither the Alaska
Permanent Fund Corporation (APFC) or the Alaska Retirement
Management (ARM) Board had prioritized an ideological goal over
financial returns. Nonetheless, he said he wanted to tighten up
the statutory language to clarify the bill's intent in law.
1:13:18 PM
REPRESENTATIVE MINA asked about the prudent investor rule for
managers of the Alaska Permanent Fund ("the fund") and whether
their decisions are ever governed by the legislature.
1:14:01 PM
KEVIN MITCHELL, Executive Director, Alaska Permanent Fund
Corporation (APFC), defined the prudent investor rule as
investing in a fashion that would maximize the risk adjusted
rate of return for the beneficiaries without personal
considerations taken into account. Deviations from that have
typically been divestiture efforts. He shared for example, that
Russia's invasion of Ukraine resulted in many divestiture
efforts around the world that Alaska did not partake in, as APFC
was able to benefit from the fire sale of securities. He
assured the committee that the fund has not made decisions based
on anything other than maximizing the risk adjusted rate of
return for the fund.
REPRESENTATIVE MINA questioned the ways in which the legislature
dictates the managers' investment decisions.
MR. MITCHELL indicated that the legislature's involvement is
related to asset classes. He said there's been a gradual
evolution of allowed investments as the markets evolved over the
past 50 years.
1:19:02 PM
VICE CHAIR KOPP inquired about the unintended consequences of a
fiduciary decision that's perceived to be ideological but is
financially motivated. He considered an example involving
climate change.
MR. MITCHELL said the fiscal note is indeterminate because APFC
shares that concern. He considered, for example, that a company
in the fund's portfolio might misalign with the intent of the
legislation. He said the bill sponsor's testimony assured him
that the bill wouldn't prohibit the Board of Trustees ("the
board") from making certain investments that would maximize
return as long as it's not motivated by a desire to change
something from a policy perspective.
REPRESENTATIVE MCCABE emphasized that the sole focus of the bill
is "fiscal." He shared an example and reiterated that the goal
is to invest in companies that are making money regardless of
the social implication.
1:23:16 PM
VICE CHAIR KOPP recalled that Alaska has strict procurement laws
and asked for confirmation.
MR. MITCHELL shared his understanding that there is a list of
countries that reflect concerns about the potential of US based
investors deploying money to a hostile regime. However, he said
he was not aware of an annual diligence requirement, but the
general concept is circulated and has impacted the fund in the
past.
VICE CHAIR KOPP shared his belief that there is a federal list
that the state is precluded from contracting with.
REPRESENTATIVE MCCABE reiterated that he wants to make sure that
the state is investing for financial gain.
1:28:47 PM
REPRESENTATIVE VANCE asked whether these policies have led to
missed opportunities.
MR. MITCHELL stated that it hasn't been an issue for the fund
and if anything, it has benefitted from its independent stance,
historically.
REPRESENTATIVE VANCE asked how much the fund would have lost if
it divested during fire sale that ensued from the invasion of
Ukraine.
MR. MITCHELL said he did not know exact number, but many
securities lost all their value for a period of time. He
acknowledged interest payments were still being made on bonds,
but there was no secondary market due to a lack of buyers. If
anything, he suggested that it presented an opportunity to lean
in if the belief was that Russia was going to pay on those
securities, and if it fit the risk tolerance. He explained that
Alaska was able to hit the "sweet spot" because it was able to
hold on to its securities and exit in a rational fashion. He
offered to follow up with the numbers.
REPRESENTATIVE VANCE asserted that the fund had "disrespected
the traditional will of the legislature" to maintain its focus
on finances. She asked whether that is a safe assumption.
MR. MITCHELL said there's two prongs to consider: the
constitutional framework around the fund, which states that the
money would be invested in income producing securities, and the
statutory framework that provide the concepts of the prudent
investor rule, fiduciary duties, and maximizing the risk
adjusted rate of return.
1:39:33 PM
REPRESENTATIVE MINA referred to AS 37.13.120 and asked whether
investors ever consider social or political factors in their
investment decisions.
MR. MITCHELL answered, "certainly," and shared a hypothetical
example of investing in wind turbines.
REPRESENTATIVE MINA asked whether there would ever be a scenario
where investors are prioritizing social and political factors
over their statutory responsibility to maximize the expected
return.
MR. MITCHELL answered no.
REPRESENTATIVE MINA asked what issue would be solved by the
bill.
1:41:59 PM
REPRESENTATIVE MCCABE gave the example of a fund that decided to
invest for environment, social, and corporate governance (ESG)
purposes, which could result in financial loss. This is the
impetus of the bill, he said. Although it doesn't solve a
current problem, it could solve a future one, he added, and
shared several examples.
REPRESENTATIVE MINA asked if one of the fund's managers decided
to focus solely on diversity, equity, and inclusion (DEI)
investments, whether they would be violating the prudent
investor rule outlined in AS 37.13.120 under current law.
REPRESENTATIVE MCCABE answered yes. He reiterated that the bill
would have almost zero effect on the fund's current practices,
and that it would emphasize the focus on pecuniary benefit only.
1:45:46 PM
VICE CHAIR KOPP announced that HB 6 was held over.
HB 118-COUNCIL ON HUMAN AND SEX TRAFFICKING
1:46:10 PM
CHAIR KOPP announced that the final order of business would be
HOUSE BILL NO. 118, "An Act establishing the Council on Human
and Sex Trafficking; and providing for an effective date."
1:46:41 PM
REPRESENTATIVE VANCE, as prime sponsor, presented HB 118 by
offering a PowerPoint presentation [hard copy included in the
committee packet]. She began on slide 1, which read as follows
[original punctuation provided]:
House Bill 118 establishes Alaska Council on Human&
Sex Trafficking
• Coordination
• Resources
• Response
REPRESENTATIVE VANCE moved to slide 2, "Trafficking in Alaska,"
which read as follows [original punctuation provided]:
45% of trafficked youth identified are Alaska Native.
One in four homeless women at the Anchorage Covenant
House have been trafficked for sex.
Alaska Institute for Justice worked with more than 79
survivors in 2024 that includes both labor and sex
trafficking.
Alaska's rate of rape and sexual assault is 3 times
the national average.
100% of trafficked clients at Priceless report a
history of sexual abuse as a child.
REPRESENTATIVE VANCE continued to slide 3, "Recommended Action
Steps," which read as follows [original punctuation provided]:
Recommended Action Steps:
1) Enact state statutes that places the CHST in the
Department of Public Safety and establishes: the
council as the monitoring body; the term for the
council; appointments; and duties.
2) Establish membership of the council in the current
Administrative Order and future statutes that includes
the Department of Labor Commissioner or designee and
the Commissioner of the Department of Family and
Community Services (DFCS) or designee.
3) Amend the key responsibilities in the Governor's
Administrative order and future statutes to include
demand reduction and accountability programs.
REPRESENTATIVE VANCE moved to slide 4, which read as follows
[original punctuation provided]:
PURPOSE
Provide planning and coordination of programs specific
to victim services, education, public awareness, data
collection and dissemination, and reducing demand for
human and sex trafficking.
DUTIES
• Develop standardized data and annual reports
• Award grants and provide audits
• Increase education and public awareness
REPRESENTATIVE concluded on slide 5, which read as follows
[original punctuation provided]:
Alaska Council on Human & Sex Trafficking
15-member council mirrors administrative order 328
• 7 members appointed by the governor
• 6 commissioners & attorney general
• Public members
1:57:50 PM
BOB BELLANGER, Staff, Representative Sarah Vance, Alaska State
Legislature, on behalf of Representative Vance, prime sponsor,
Presented the sectional analysis for HB 118, which read as
follows [original punctuation provided]:
Section 1: Amends AS 39.25.110 to exempt the executive
director of the Council on Human and Sex Trafficking
from "Classified Service."
Section 2: Amends AS 39.50.200(b) to add the Council
on Human and Sex Trafficking to the list of "state
commission or board."
Section 3: Inserts the following new sections:
Sec. 44.41.150 establishes the Council on Human
and Sex Trafficking as a permanent board in the
Department of Public Safety and sets forth the purpose
of the council.
Sec. 44.41.155 lays out the duties of the
council.
Sec. 44.41.160 establishes the Membership of the
council consisting of a total of 15 members seven of
which will be appointed by the governor, and the other
members will consist of the chief executive officer,
commissioner, or designee from various organizations
or commissions. It also sets the terms for the public
members.
Sec. 44.41.165 sets forth how and how often
meetings are scheduled and what constitutes a quorum.
Sec. 44.41.170 prohibits members from receiving a
salary but provides for transportation expenses and
per diem.
Sec. 44.41.175 establishes the definitions under
AS 44.41.150 - 44.41.175 for "council" and "human and
sex trafficking."
Sec. 4: Amends a section to include the council's
sunset on June 30, 2029.
Sec. 5: Sets an effective date of July 1, 2026.
2:02:27 PM
REPRESENTATIVE UNDERWOOD talked about Alaska ranking number one
in the country [for rates of sex trafficking] and the
effectiveness of awareness classes.
2:05:15 PM
REPRESENTATIVE COSTELLO sought to better understand the work
done previously on this issue.
2:06:11 PM
KATIE TEPAS, Program Coordinator, Department of Public Safety
(DPS), said the foundation was laid by former Governor Sean
Parnell's taskforce in 2013, which "timed out" after submitting
a report to the legislative body. In 2021, Governor Mike
Dunleavy issued the first of two administrative orders, which
designated the Council on Human and Sex Trafficking ("the
council") under DPS. The first report offered significant
recommendations under key priority areas. The second report
finetuned those recommendations to actions items not requiring
designated funds. The priority areas included: expanding
services providers; demand reduction programs; addressing
housing issues; developing resource guides; training for law
enforcement and medical providers; public awareness campaign
materials; e-learning modules and curriculum review; and
establishing the council in statute.
2:08:37 PM
REPRESENTATIVE COSTELLO asked for confirmation that the bill
would make no changes to the designated funds by putting the
council in statute.
MS. TEPAS replied that by simply putting the council in statute,
the mission would not be drastically furthered. She said grant
funds or state dollars would be needed to affect change and hire
additional staff, like a grant administrator, program
coordinator, and an administrative assistant. She recommended
that a deep dive is needed to compile all of the services that
are available to victims and survivors of trafficking across the
state and better understand what's needed on a regional level.
2:12:16 PM
REPRESENTATIVE COSTELLO pointed out that the majority of council
members are with organizations that work on sex trafficking.
She asked whether these entities would bear some of the
financial responsibility for the council's goals and objectives.
REPRESENTATIVE VANCE acknowledged that many of the members are
already doing the work, but the council is needed to pool
resources and data, which would help illuminate big picture
trends from information that is currently being siloed. She
explained that putting the council in statute would grant the
authority to administer grants, which the Governor's Council on
Human and Sex Trafficking currently lacks. She expressed her
hope that the council's mission would mature over time and
spread awareness.
2:16:54 PM
VICE CHAIR KOPP commented on prior legislation that attempted to
combine the Council on Human and Sex Trafficking with the
Council on Domestic Violence and Sexual Assault (CDVSA). He
asked whether this idea had garnered further consideration due
to the cost of standing up a new council.
REPRESENTATIVE VANCE confirmed that there had been two
renditions of this idea in recent years and offered further
context on the legislative history. She explained that the
current version would avoid frontloading the council's
responsibilities with statutory mandates and continue the work
of the governor' council as resources come available.
2:20:30 PM
REPRESENTATIVE EISCHEID how many meetings the council had in
2024.
MS. TEPAS offered to follow up with the requested information.
She noted that there were numerous different working groups that
met monthly in addition to full council meetings. She shared
her understanding that the council would meet quarterly under HB
118.
2:22:13 PM
REPRESENTATIVE MINA how the council's membership structure was
decided.
MS. TEPAS said membership was determined through the governor's
office.
REPRESENTATIVE MINA asked about gaps in the council's membership
as it relates to immigrants and refugees, and whether the bill
sponsor had considered updating current membership to be more
representative of the different facets of human trafficking in
Alaska.
2:25:12 PM
REPRESENTATIVE VANCE recalled that a request was made to expand
the governor's council to be more inclusive of labor
trafficking. In response, the governor amended the executive
order (EO) to include the Department of Labor & Workforce
Development (DLWD) and the Department on Family and Community
Services (DFCS).
2:27:34 PM
VICE CHAIR KOPP announced that HB 118 was held over.
2:28:07 PM
ADJOURNMENT
There being no further business before the committee, the House
Judiciary Standing Committee meeting was adjourned at 2:28 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 6 A.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 6 |
| HB 6 Ver A SectionalAnalysis.3.12.25.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 6 |
| HB 6 Ver A SponsorStatement.3.12.25.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 6 |
| HB 6 Ver A SupportingDoc.K&LGates.3 512.25.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 6 |
| HB 6 Ver A SupportingDoc.Ballotpedia.ESG.3.12.25.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 6 |
| HB 6 FN Revenue.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 6 |
| HB 118 - Sponsor Statement - Alaska Council on Human and Sex Traffickings.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 118 |
| HB0118A.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 118 |
| HB 118, 34-LS0316-I - Sectional Analysis.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 118 |
| HB 118 - GCHST-Final-Report-Sept2022.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 118 |
| HB 118 - Alaska Governor's Council on Human and Sex Trafficking Data Summary Document January 2024.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 118 |
| HB 6 FN Retirement Management Board.pdf |
HJUD 3/19/2025 1:00:00 PM |
HB 6 |
| HB 118 ACHT.pptx |
HJUD 3/19/2025 1:00:00 PM |
HB 118 |