HOUSE BILL NO. 260 An Act relating to a State Officers Compensation Commission and establishing how legislators, the governor, the lieutenant governor, and executive department heads shall be compensated; providing for an effective date by repealing the effective dates of certain sections of ch. 124, SLA 1986; and providing for an effective date. REPRESENTATIVE MIKE DOOGAN, SPONSOR, spoke in support of HB 260, based on the only successful salary commission in the State of Alaska. The Commission was active in 1977 & 1979, when citizen members of the Alaska Salary Commission released reports on how much certain public officials should be paid. The original Commission had a broader scope than the one presented in HB 260. Since 1979, there has not been a comprehensive look at compensation of members above a certain level. HB 260 would establish a compensation commission consisting of five members appointed by the Governor. Former legislators would be prevented from serving on the commission until they had been out of office for four years. Members would serve staggered terms and would be assigned to reconsider compensation every two years. Representative Doogan explained that the decisions of the Commission would become law unless specifically disapproved by the legislature within 60-days of receipt. The effective date of the actions would be tied to the legislature appropriating funds. 2:46:14 PM Representative Doogan pointed out that in the House State Affairs (STA) Committee, Representative Coghill voiced confusion if the vehicle for enacting the findings should be a resolution or a bill. He pointed out the memo from Legal Services explaining the decision to place it in bill form. Vice-Chair Stoltze questioned if the task of the Commission would be similar to that of the task force recommendation for passing gambling. Representative Doogan thought if the issue was left to legislators, there would never be consideration for fear of constituent disapproval. In the past, it was determined that a citizen commission could work. Vice-Chair Stoltze informed that the Gaming Commission had attempted to insulate members from the political pressures. Representative Doogan responded that legislators are never insulted from political pressures; however, the bill attempts to provide an "even-handed" look at the process. It is political at every stage of the process. Co-Chair Meyer said that the Anchorage Assembly does use a Commission as proposed and that it works well. 2:50:04 PM Representative Hawker addressed the philosophical component of the legislation. Previous testimony indicates that there had been intent, resulting in action to raise the salaries of the Legislature. He wondered if the legislature should be a choice for public service without receiving compensation, acting more like a volunteer service. Representative Doogan stated the bill was not proposing a plan to do anything particular with legislative salaries but rather proposes creating a commission of citizens to look at the question in a more even way. There are a number of ideas the commission could determine such as a system paying for longevity of members. He emphasized his intent in sponsoring the legislation is to create a discussion and reviewing arena. 2:53:06 PM Representative Hawker understood that the intent of the legislation was to increase legislative compensation. He asked if that was true. Representative Doogan explained that in order to have a legislature reflecting the population's age balance, the State would have to offer higher compensation. He pointed out that legislators in their 50's & 60's are overrepresented and that those in their 20's & 30's are not adequately represented. He discussed that if salaries are increased, there would be a change in the age and make-up of the legislature. 2:54:55 PM Representative Hawker commented if that was the intent or if rather more of an exploratory outcome. Representative Doogan believed the discussion is about what might happen through passage of the legislation. Representative Hawker referred to Page 5, regarding a recommendation that the Commission "may not" have the effect of reducing compensation or benefits of someone who is in office; he asked if that would apply to legislative salaries. Representative Doogan advised that he had attempted to keep the Legislature out of the bill as much as possible. Representative Hawker referenced Line 17, Page 5, the "policy of legislature that the commission recommends an equitable rate for legislators." He asked what "equitable" meant. Representative Doogan replied the definition was not attempting to determine compensation. Representative Hawker suggested it should be equal treatment under the law. Representative Doogan said yes. Representative Hawker advised that the language is stating exactly what it is intended. 2:57:40 PM In response to a query by Representative Gara, Representative Doogan expected that if the bill were to pass that there would be compensation determined by longevity of legislators. Co-Chair Meyer clarified if the intent of the Commission was to look at how other States handle the issue. Representative Doogan informed that the handout addresses other state's policies and procedures. 3:00:43 PM Representative Nelson made clear that to offer no compensation for the legislative positions would be a disincentive to people considering whether to run for office or not. She thought that there would be a disproportionate number of wealthy and retired people holding office. She hoped to encourage more variety of candidates to step forward. She thought that the 90 day session makes it more appealing, providing more time for other employment. She mentioned that the legislation to move the capital was also being put forward as an opportunity for better public participation while serving in the Legislature. She stated she did not support that legislation. Representative Nelson reiterated that it is wrong to have more rich and retired people doing the work for the State and that it is better for the legislative body to have more variety in who serves. Representative Doogan wholeheartedly agreed. He added that many people are kept from public office because of their obligations in life versus the compensation offered. 3:03:03 PM Representative Thomas commented on his determination to run for public office and the losses incurred personally because of the number of special sessions, affecting his livelihood. He noted that it actually him approximately $70 to $80 thousand dollars per year. He hoped the process would be better controlled through a public commission. Co-Chair Meyer agreed that it is out of the hands of the legislators. He noted in California, legislators are salaried at $110 thousand dollars per year but that they are not allowed to hold any other job. Vice-Chair Stoltze agreed that the ideas presented have been intriguing. The founders of the Constitution did not establish criteria for legislator's salaries. 3:08:08 PM NICKI NEAL, DIRECTOR, DIVISION OF PERSONNEL, DEPARTMENT OF ADMINISTRATION, offered to answer questions of the Committee. 3:08:41 PM PUBLIC TESTIMONY CLOSED. Representative Kelly believed that there is no easy solution to the issue of a citizen versus professional legislature. He personally leaned toward a citizen's legislature. He remembered a previous salary proposal of $94 thousand dollars per year. He encouraged the natural & healthy tension remains in place. He believed that moving toward a higher salary, determines a decision to have a professional legislature in place. He hoped that whichever decision was made, it would work well & fluid. 3:13:09 PM Co-Chair Meyer agreed that the current system is working. He hoped that when the Commission does looks at other states of a similar size & issues, they would be able to determine that Alaska does not offer or need a full time job. Representative Crawford acknowledged there is no accounting for who the public chooses to represent them. He agreed that the compensation issues should be determined from non legislative persons. He indicated his support for the legislation. Representative Hawker voiced confusion on the issue, which raises philosophical concerns on both sides of the argument. If the desired outcome is to increase legislative salaries, the legislation is the way to accomplish that; however, handing the responsibility off to a public Commission could provide too much legislative authority to that group. He recommended it be discussed through the legislative process. He noted that the recommendations of the Commission could take the effect of law unless a bill is introduced and objection made by the Legislature. Representative Doogen understood that the recommendations would be a bill, which would have to be disapproved by the Legislature within 60- days. Representative Hawker stated that was not clear in the bill. Representative Doogan agreed. He added that the central fact is that if the Commission determines a higher salary, the effective date of that recommendation would be when the appropriation passes. The dollars would not be available until an appropriation passes. Ultimately, it is the Legislature's responsibility to fund it. Representative Hawker stated it is "complex effectiveness" and thought that as a Commission, they should make recommendations so that the elected policy body can make the decision. 3:18:49 PM Representative Doogan said that had been discussed. He believed it puts it back in the hands of the legislature and then they would determine the need to pass or not pass the bill. Representative Nelson commented that the current method used is that of the federal rate of per diem. Whenever that amount is increased, the press broadcasts it; however, when it decreases, it is never publicized. She agreed with Representative Doogan and doubted if the issue would ever be addressed up by the Legislature. She remembered when the per diem actually increased and how that affected the public's perspective. She maintained that the present pay rate for legislators is good and that compared to jobs in most districts, it pays well. 3:22:11 PM Representative Thomas assumed that the bill intended to keep a citizen's legislature. Representative Doogan responded that the idea was not to debate whether it would remain a citizen's legislature. Representative Thomas added that if the public does not think their legislator is doing a good job, they will not re-elect them. 3:24:06 PM Co-Chair Meyer noted the back-up materials indicating how other states determine compensation, pointing out that most do have a commission. He reiterated that he had been involved is a similar system when working on the Anchorage City Council and was comfortable with the approach proposed in the legislation. Co-Chair Meyer referenced the fiscal note. Representative Doogan explained that the request in the amount of $7.5 thousand dollars would cover travel and per diem costs; the salary is zero. 3:26:50 PM Vice-Chair Stoltze MOVED to REPORT CS HB 260 (STA) out of Committee with individual recommendations and with the accompanying fiscal note. There being NO OBJECTION, it was so ordered. CS HB 260 (STA) was reported out of Committee with a "no recommendation" and with fiscal note #1 by the Department of Administration.