HB 35-CONFLICT OF INTEREST: BD FISHERIES/GAME  1:56:20 PM CO-CHAIR LINCOLN announced the next order of business would be HOUSE BILL NO. 35, "An Act relating to participation in matters before the Board of Fisheries and the Board of Game by the members of the respective boards; and providing for an effective date." [Before the committee was the committee substitute (CS) for HB 35(FSH), reported out of the House Special Committee on Fisheries on 3/13/19.] 1:56:49 PM MATT GRUENING, Staff, Representative Louise Stutes, Alaska State Legislature, on behalf of Representative Stutes, sponsor, introduced HB 35. He read from the following written sponsor statement [original punctuation provided]: This legislation changes the manner in which the Board of Fisheries and Board of Game function by allowing members to deliberate on subjects for which they have a declared personal or financial interest according to AS 39.52, the Executive Branch Ethics Act. Members are selected based on their "knowledge and ability in the field of action of the board, and with a view to providing diversity of interest and points of view in membership"; however, Title 39 prohibits a member from "taking or withholding official action in order to affect a matter in which the member has a personal or financial interest." (AS 39.52.120(b)(4)). "Official action" is defined as "advice, participation, or assistance, including for example, a recommendation, decision, approval, disapproval, vote, or other similar action, including inaction by a public officer." (AS 39.52.960(14)). Currently, board members are required to divulge a conflict of interest if they, or their immediate family members, are involved in the subject being deliberated on. The conflicted member can then no longer offer their input on the process and cannot vote on the matter at hand. Often in the fishing world, a financial or personal interest corresponds with someone's knowledge of that particular fishery. This bill allows the conflicted member to offer remarks and input, but still precludes them from voting on the issue at hand or on whether they have a conflict of interest. Allowing members with expertise in particular fields to deliberate will help the boards make more informed decisions, lead to stronger resource management statewide, and align process with intent as far as the boards benefiting from members' knowledge and diversity of viewpoints. Thank you for your support of this legislation. 1:58:44 PM MR. GRUENING advised sound resource management should be based on all available information. However, in the fishing industry, financial or personal interests may be tied to the knowledge of a fishery; for example, a board member with a close relative who owns a certain permit may be the only board member with an understanding of a proposal. Similarly, guides or lodge owners may be the only board member with an understanding of a hunt. Especially in rural Alaska, an entire family may be engaged in one manner of work such as commercial fishing, guiding, or hunting, thus the current policy discourages qualified applicants because a board member would be unable to speak on many proposals. Mr. Gruening described how members are excluded from board discussions and provided examples. He explained another concern with the current conflict of interest policy is one of transparency and trust in the public process; board members who disclose a conflict sometimes share their opinions off the record and outside of the public view, which is discouraged by the aforementioned ethics act. He pointed out the bill would allow a board member who has disclosed a conflict "to impart their knowledge before they recuse themselves from the vote." Mr. Gruening restated the importance for Board of Game (BOG) and Board of Fisheries (BOF) members to have all available information on hand, and on the record, prior to making a decision. He cautioned the selection process for BOG and BOF members is contentious in order to populate boards that are balanced and acceptable to the public, the legislature and the governor; therefore, silencing voices during deliberations erodes the integrity of the public process. Mr. Gruening closed, pointing out 11 letters and 19 emailed messages of support included in the committee packet, and noting no letters of opposition were received. He urged for the committee to review a document entitled, "Background Information on the Alaska Boards of Game and Fisheries Ethics Act Process," also included in the committee packet. 2:03:49 PM REPRESENTATIVE RAUSCHER asked whether there are differences between the bill and a similar bill that was proposed last year. MR. GRUENING explained the only difference with the bill proposed last year is that the redefinition of an immediate family member - that affected voting and thereby the ethics disclosure process - was removed. 2:05:30 PM FRANCES LEACH, Executive Director, United Fishermen of Alaska (UFA), informed the committee UFA represents 35 commercial fishing organizations and hundreds of commercial fisherman and crewmembers, throughout the state, fishing in state and federal waters. Ms. Leach said UFA has supported this important legislation for some time because BOG and BOF members are chosen for their expertise, within their region or fishery, or for their local hunting and game knowledge; however, at this time, board members who have expertise in a certain subject are not allowed to participate in deliberations. She gave her personal experience with BOF under these circumstances and advised allowing knowledgeable board members to fully participate in deliberations will result in a better record to assist board members, and all of the information will be established on the record. Although members with expertise are encouraged to serve on the boards, the current policy discourages some. Ms. Leach urged the committee to pass the bill. 2:08:07 PM JERRY MCCUNE, President, Board of Directors, Cordova District Fishermen United (CDFU), informed the committee CDFU represents about 1,000 fishermen. He provided examples of board members who were unable to deliberate under various circumstances. Mr. McCune opined the statute is unfair and creates frustration. Further, a familial relationship does not always equate to financial gain, and board members rely on each other for advice. 2:10:34 PM CO-CHAIR LINCOLN opened public testimony on HB 35. 2:11:13 PM BENJAMIN MOHR, Executive Director, Kenai River Sportfishing Association (KRSA), expressed KRSA's opposition to HB 35. Mr. Mohr informed the committee there is no need to modify the ethical guidelines that now apply to BOF. Current conflict of interest procedure provides four opportunities for "conflicted" board members to participate in the public process to a greater degree than the general public: public comment, committee of the whole, board deliberations, and voting. During committee of the whole procedures board members, including conflicted members, interact with the public, the Department of Law (DOL), and the Alaska Department of Fish & Game (ADFG), and board members can interact with state agencies, proponents and opponents of proposals, and others, which is an advantage the public does not have. Following its committee work, conflicted board members are recused, and BOF begins formal deliberations. Mr. Mohr opined HB 35 expands the influence of board members who have a direct financial interest in a matter under consideration, even though conflicted board members already have an opportunity in formal and informal settings to ensure their opinion and expertise is known. He advised current "conflict procedures" are not unknown, or untested, and have been reasonably effective; KRSA believes loosening the ethical guidelines for BOF and BOG is not in the public interest. REPRESENTATIVE SPOHNHOLZ asked for clarification on the opportunities conflicted board members have to participate in addition to the committee of the whole discussion. MR. MOHR said conflicted board members participate as members of the public during public comment. In further response to Representative Spohnholz, he said there are currently sportfishing interests serving on BOF. 2:14:38 PM REPRESENTATIVE HANNAN asked whether a board member who holds a sportfishing license would be "conflicted out" of making allocative decisions about sportfishing. MR. MOHR expressed his understanding the chairman of BOF or BOG is the ethics officer who would make a final decision about a conflict; however, there must be a direct financial interest, and holding a sportfishing license would not establish a direct financial interest in the management of the sportfishing fishery. REPRESENTATIVE HANNAN observed the BOF ethics disclosure statement does not define a threshold for a direct financial interest. She asked for the point at which one has a financial interest in the sportfishing fishery. MR. MOHR restated the decision on an unethical conflict is up to the chairman of BOF and BOG, and DOL. 2:16:55 PM GLEN HAIGHT, Executive Director, BOF, ADFG, explained matters of subsistence, personal use, and sportfish affect everyone equally thus there is no effort to assess personal financial benefit to those matters; a board member who holds a sportfish license or who engages in a subsistence fishery is not conflicted out. However, a guide operator may be affected; according to DOL, the threshold is $5,000, and a conflict may arise at that point. REPRESENTATIVE HANNAN questioned whether the guide's threshold of economic return is based on the value of the sportfishing day trip or on the value of the fish [caught]. MR. HAIGHT said, "It's to the operator, the commercial operator, it doesn't apply to their client." REPRESENTATIVE HANNAN asked whether sportfishing lodge operators would be conflicted out of all sportfishing decisions. MR. HAIGHT gave the example of a lodge owner whose lodge operates in an affected area and who would benefit from a board action; this would be a specific instance. 2:19:54 PM CO-CHAIR LINCOLN, after ascertaining no one further wished to testify, closed public testimony on HB 35. REPRESENTATIVE HANNAN returned attention to the BOF ethics disclosure and observed the definition of family differs from that of the legislature's ethics law. MR. GRUENING explained in the executive branch ethics act immediate family member is defined in AS 39.52.960 (11) as follows [original punctuation provided]: (11) "immediate family member" means (A) the spouse of the person; (B) another person cohabiting with the person in a conjugal relationship that is not a legal marriage; (C) a child, including a stepchild and an adoptive child, of the person; (D) a parent, sibling, grandparent, aunt, or uncle of the person; and (E) a parent or sibling of the person's spouse; MR. GRUENING pointed out the aforementioned differs from the legislative branch definition found in AS 24.60.990 (6) [original punctuation provided]: 6) "immediate family" means (A) the spouse or domestic partner of the person; or (B) a parent, child, including a stepchild and an adoptive child, and sibling of a person if the parent, child, or sibling resides with the person, is financially dependent on the person, or shares a substantial financial interest with the person; MR. GRUENING said, "That was pretty close to the definition that was in the bill before it was removed ...." REPRESENTATIVE HANNAN surmised the BOF ethics disclosure states not just the immediate family, but a member of the family, and the bills narrows the definition to immediate family. 2:23:41 PM MR. GRUENING clarified the bill makes no change to the definition of immediate family; for BOF and BOG, the statutes are AS 39.52.960 (9) and (18) [original punctuation provided]: (9) "financial interest" means (A) an interest held by a public officer or an immediate family member, which includes an involvement or ownership of an interest in a business, including a property ownership, or a professional or private relationship, that is a source of income, or from which, or as a result of which, a person has received or expects to receive a financial benefit; (18) "personal interest" means an interest held or involvement by a public officer, or the officer's immediate family member or parent, including membership, in any organization, whether fraternal, nonprofit, for profit, charitable, or political, from which, or as a result of which, a person or organization receives a benefit; [HB 35 was held over.]