SB 105 - ETHICS/LOBBYING/CAMPAIGN FINANCE Number 0070 CHAIR JAMES announced the next order of business is CSSB 105(FIN) AM, "An Act relating to legislative and executive branch ethics; relating to campaign finances for candidates for state office; relating to the conduct and regulation of lobbyists with respect to public officials; relating to the filing of disclosures by certain state employees and officials; making a conforming amendment to the definition of 'public official' for employment security statutes; and providing for an effective date." CHAIR JAMES noted Suzie Barnett and Mike McMullen were available to testify. She stated there are other amendments and that she doesn't plan to move SB 105 out until Saturday. She indicated the Alaska Railroad hearing, regarding land between Fairbanks and Eielson, will also be addressed. Number 0078 REPRESENTATIVE HODGINS reminded the committee they were embroiled in an amendment which he presented for Representative Ryan at the last meeting. CHAIR JAMES acknowledged they adjourned with Amendment L.8 on the table and called a brief at-ease. Number 0087 BEN BROWN, Legislative Administrative Assistant to Senator Kelly, Alaska State Legislature, came before the committee. He explained it adds a new section [Section 62]. CHAIR JAMES suggested first dealing with Amendment L.8, which has already been amended, and then taking up the CS. Number 0115 REPRESENTATIVE ELTON objected. He said we're expecting anybody that makes a complaint to first make a determination of whether it's frivolous or not. He stated there were considerable questions raised about what the Ethics Act does now, let alone what it would do as amended. Representative Elton said he believes we're creating a threshold, that a lot of people considering filing complaints may not want to step over. The other effect of this amendment is, it's going to make the Legislative Ethics Committee make an initial determination of whether or not a complaint is frivolous, and they're going to have the courts looking over their backs. REPRESENTATIVE ELTON submitted it doesn't matter whether this is in here or not. He said there are civil actions that can be taken outside the Ethics Act - in the case of something that is liable or slanderous. He believes it's something we don't need and we're complicating the Ethics Act. It's also a dash of cold water in the face of a lot of people who may not understand what frivolous means. Number 0130 MR. BROWN said the one concern he has is in Section 46, page 28, line 11, AS 24.60.170(3). He noted this is adding to the complaint receipt and processing process. We specifically enable the committee to return things for frivolity: that the complaint is frivolous on its face, that there is insufficient credible information that can be uncovered to warrant further investigation by the committee, MR. BROWN indicated that's the same intent of the amendment before us. He said he didn't know that both approaches are necessary because there is a concern that we might almost undo what we're doing in Section 42 because it will make Ms. Barnett uncomfortable determining frivolity if she knows that there is a potential for a $5,000 penalty attached. Every time frivolity is determined, it's going to have to be done by the full committee. Mr. Brown mentioned the other thing is, is we're not doing this for the executive branch. Number 0145 REPRESENTATIVE ELTON said it's not $5,000 that we're talking about, it's $5,000 or the greater of actual damages so it could be considerable. The subject of the complaint may recover the greater of actual damages or $5,000 from the person who filed the complaint. CHAIR JAMES stated actual damages in any case should be recognized. She indicated it would bother her if it said there aren't any damages at all, (indisc.) still get $5,000. REPRESENTATIVE BERKOWITZ said if it's frivolous, nothing's going to happen, it's going to get screened out, and if there's no jurisdiction, it's going to get screened out. So there aren't going to be any actual damages on account of it, we're creating a disincentive for people to make applications. He said he thinks the protection for the legislators, against frivolous or nonjuridical complaints, is already in this bill. Number 0156 CHAIR JAMES agrees with Representative Elton's assumption that this will cause people not to want to file complaints, and believes that's the true intent of it. She said there is that argument that every single person should be able to file every complaint that they want to make. She also doesn't think this is necessarily workable and believes the goal is to stop people from filing frivolous complaints. Chair James indicated she doesn't believe anyone would ever collect $5,000 because people would be more serious about filing complaints if they knew, that if it was determined to be frivolous, they wouldn't. CHAIR JAMES said when it comes to affecting a person's life negatively, or if there's a cost involved, there certainly ought to be a way to address that. Going to court is always an option, but when people plead ignorance, it's very remote to getting anything out of it, so you're damaged and they got off-the-hook, scot-free. When it comes to ethics, we all know what our intent is as to whether or not it's ethical but nobody is measured on intent regarding ethics. The whole problem she has with this issue is that ethics is one of those areas you can't win on because it doesn't measure your intent, it measures what you've done and somebody else's idea of what your intent was. She said it's contrary to common law, which common law bases our decisions of our wrong doing on our intent. Ethics is a whole new ball game of its own. She indicated she doesn't like it and wished the legislature did not have an ethics committee. It's ridiculous to her that the public would demand such a committee. However, she will try to give them everything she can and the tools to do their job which they have been assigned to do. CHAIR JAMES asked Representative Ryan if he wanted to speak to this. REPRESENTATIVE RYAN replied no. Number 0187 REPRESENTATIVE BERKOWITZ pointed out that it is a crime under AS 11.56.805. It's a class A misdemeanor to make a false accusation with the Select Committee on Legislative Ethics. He said, so that's in position, it's a class A misdemeanor but it's a class B felony - interference with official proceedings if a person threatens anyone with intent to affect the outcome of an official proceeding. The criminal statutes make provision for people who abuse this process. CHAIR JAMES said that's absolutely true. Her own observation of someone filing a case in court, is that you can't really take it to small claims because in small claims that person has to agree that they owe it. She said there's no real benefit of taking it to court unless there's a large sum of money, and so these things go unattended. On top of that, to determine that somebody made a false statement, you first of all have to know that they knew that they were making a false statement. You have to prove that they intended to do it that way. Chair James concluded that the whole issue is cloudy and thinks they talked about this enough and should vote on the amendment. Number 0201 REPRESENTATIVE ELTON stated he doesn't disagree with a lot of what Chair James is saying, but indicated he is uncomfortable with the definition of frivolous because it's going to be a different definition as we go to each person at the table. He remarked we can define false, but he's not sure we can define frivolous. CHAIR JAMES said she would like to try. What she understands frivolous to mean is out and about on it's own with no basis of facts and of no need, it's extra, it's on top of everything else, it has no purpose. Number 0208 SUZIE BARNETT, Professional Assistant to the Legislative Ethics Committee, testified via teleconference and asked to speak to two things in the amendment that concern her. She said they are the words, "or the committee lacks jurisdiction," which is a whole different issue altogether. Those who have served on the ethics committee can tell you that it can be a very close call as whether an allegation falls within the ethics code or not. Ms. Barnett said she doesn't believe the legislature truly expects the public to have an attorney's in depth understanding of the ethics code. For example, if a legislator embezzled funds from a company that he or she worked for, somebody out in the public may read that and may think that's clearly unethical behavior. However, the ethics code doesn't address embezzlement unless state resources were used in some way. So, should that person be potentially fined because the committee would have to find that it lacks jurisdiction. She mentioned that it probably wasn't a politically motivated complaint, it was just someone in the public outraged. SUZIE BARNETT said the second part is, just to kind of repeat what Mr. Brown was saying, she said she believes Representative Ryan and the committee have the same goal, and that is to be able to not deal with frivolous complaints so that there aren't damages as talked about. The committee put that in. She stressed that she is very concerned that, with this amendment, there's a danger that the committee may incorrectly create a situation that punishes the person who felt they were filing a valid complaint. In that case, the committee might choose to deal with all complaints in the manner they do now, having to deal with them, the whole committee looking at them, so that there isn't this fear of potentially damaging someone and having the court look at it. Number 0226 CHAIR JAMES asked if the objection is still maintained on Amendment L.8. REPRESENTATIVE ELTON replied yes. CHAIR JAMES asked for a roll call vote. Representatives Hodgins and Ryan voted in favor of the amendment. Representatives Ivan, Berkowitz, Elton and James voted against it. Therefore Amendment L.8 failed by a vote of 2-4. Number 0233 REPRESENTATIVE HODGINS made a motion to move proposed committee substitute LS0074\P, Cramer, 4/9/98, as the working document. REPRESENTATIVE BERKOWITZ, for clarification, asked if Version P is solely the incorporation of amendments previously accepted by this committee. CHAIR JAMES replied that's correct, there being no objections, that version is before the committee. She again announced the committee will only walk through the amendments because there will be more amendments offered since the bill is currently being reviewed by the leadership in the House. Number 0257 MR. BROWN explained Version P.1 very much mirrors what we put in the bill last week which put a moratorium on the receipt of new complaints by the Legislative Ethics Committee in a campaign period, the period immediately preceding an election. He said that's the period when it's likeliest to be politicized, that a complaint is going to be filed for the wrong reasons, that it's not going to be possible for the committee to investigate adequately and come up with a resolution in a fair manner to the subject. Therefore, the subject is going to be at a political disadvantage because of misuse of the legislative ethics system. Page 27, line 28, following ".": Insert: The committee shall treat a complaint concerning the conduct of a candidate for election to state office that is pending at the beginning of a campaign period in accordance with (p) of this section. Page 31. line 6: Delete: "a new subsection" Insert: "new subsections" Page 31, line 21, following "." Insert: (p) When the committee has a complaint concerning the conduct of a candidate for state office pending before it at the beginning of a campaign period that has not resulted in the issuance of formal charges under (h) of this section, the committee may proceed with its consideration of the complaint only to the extent that the committee's actions are confidential under this section. The committee may not, during a campaign period, issue a dismissal order or decision under (f) of this section, issue an opinion under (g) of this section, or formally charge a person under (h) of this section. If the committee has formally charged a person under (h) of this section and the charge is still pending when a campaign period begins, the committee shall suspend any public hearings on the matter until after the campaign period ends. The parties to the hearing may continue with discovery during the campaign period. If a hearing has been completed before the beginning of a campaign period but the committee has not yet issued its decision, the committee may not issue the decision until after the end of the campaign period. Notwithstanding the suspension of public proceeding provided for in this subsection, a candidate who is the subject of a complaint may notify the committee in writing that the candidate chooses to have the committee proceed with the complaint under this section. (q) Page 31, line 22: Delete: "subsection" Insert: "section" Number 0262 MR. BROWN stated the concern is that there are times when it's not a matter of receiving a new complaint that the committee may find itself being forced to act in a political way. And the case being, release the public information concerning a complaint that had been received before the moratorium began. He said he believes what this will do is prevent the committee's release of public information in a time-period similar to the moratorium dealing with the receipt of new complaints. So, the committee would still be able to dismiss a complaint that's confidential communication that goes to the complainant and to the subject during this moratorium. The committee can also adopt a resolution outlining the frivolous investigation which is not a dismissal that's still technically a confidential communication. He indicated all the communications after that point are public information. MS. BARNETT stated she hasn't received a copy of the Amendment P.1. Number 0278 REPRESENTATIVE BERKOWITZ said, "Assuming there's an adverse ruling, it would seem to me that the public has a right to know, it's important information prior to an election." MR. BROWN replied they certainly have more of a right to know that probably than when (indisc.) the complaint has not even been initiated. It's certainly easier to justify banning the receipt of new complaints in the initiation of new investigations then it is to stop the clock on ones that are already going on. But at the same time it's a tradeoff, at the same time it's still possible to politicize the process. Number 0282 REPRESENTATIVE BERKOWITZ stressed that he is very sensitive to the concern that what we're doing might be construed as any kind of coverup. He believes if someone is found culpable by legislative ethics, that's really important information. Representative Berkowitz said, "There's a different argument, if there's a charge made, and there's questions of confidentiality - which always sounds a little intriguing that we're quicker to extend confidentiality proceedings around ourselves than for juveniles. But that's something else. We need to make sure that if there's a ruling that it gets out there if it's adverse. If it's not adverse, it seems to me that should be up to the discretion of the subject." MR. BROWN said the way it's written the subject, just like the moratorium on the receipt of a new complaint, has the right to waive this. If the committee would release good things and hold on to bad things, it would be obvious on what they've decided. He indicated there is no answer to Representative Berkowitz's question. You would have to be opposed to this amendment if you wanted to ensure that information was released as decisions were reached by the committee. Mr. Brown stated it's a trade off on whether delaying the release of that information serves the public policy goal of not allowing things to become political footballs. Number 0295 REPRESENTATIVE BERKOWITZ stated, assuming there's a complaint made during this period, the ethics committee acts quickly on it, and the subject is exculpated, there's no reason for any of that information to become public. But assuming the complaint is made that's confidential, then the ethics committee finds the legislator or whoever's the subject of the investigation culpable, that, if it's a legislator in particular, it's just bad luck that it came out during a campaign season. MR. BROWN explained the way it's written right now, when the committee released its resolution outlining the scope of the investigation that would be the last public communication. He said that's a "maybe," that's definitely not a, "no there's no problem here." That's the committee saying there is something that merits further investigation. The way it's written, the last piece of confidentially information, which has a way of not remaining confidential very often is going to be something that is a question mark. So the way this amendment is structured, although we are stopping the release of the technically public information, the last piece of technically confidential information that would be released would not necessarily be to the subject's benefit. MR. BROWN said if the committee's going to adopt a resolution outlining the scope of its investigation that means enough of a flag went off that they want to keep looking at it. In laymen's terms it is probably enough for the complainant or whoever's going to run to the press with the information, even though it's technically confidential, to say, "The committee investigates blank." Mr. Brown said corruption must exist, or something, so the point with this stop thing is not necessarily to the subject's advantage. The idea here is to prevent the committee's release of public information from being an accessibly political act. Number 0311 REPRESENTATIVE ELTON summarized that if the committee dismissed the complaint, the subject of the complaint, even with this language, would be able to waive the confidentiality provisions. MR. BROWN replied the subject can always do that, you can't waive somebody else's confidentiality. He said of course it would be to your advantage to waive it if you were being exculpated. REPRESENTATIVE ELTON stated, "Under (f) of that section, when I first read this I was most concerned about what happens if the complaint is dismissed, and I just wanted to make sure that the subject can waive the confidentiality..." MR. BROWN interjected, he said, "And then even if it's not a dismissal, even if the subject decides that they want to have anything released, they can waive." The subject is always able to say, "Shine the light of public scrutiny in on this process." The protections that the moratorium, in subsection (o) that was adopted in Version P, that's an option that -- it's built-in so it's assumed that you don't want the (indisc.) receive so you don't make yourself look any guiltier by saying, "Oh, I need the moratorium." He noted the moratorium is automatic unless you affirmatively ask to waive your right to it. Number 0321 REPRESENTATIVE BERKOWITZ said he is still unclear of the process. He said there's nothing that prohibits the complainant from going public with the complaint. MR. BROWN asked Ms. Barnett if she wanted to answer that one. REPRESENTATIVE ELTON believes Ms. Barnett isn't available because she's probably at the Legislative Information Office picking up a copy of Version P. Number 0323 MR. BROWN continued. He said the proceeding is described as confidential in the statute, and Suzie [Ms. Barnett] will say it's confidential. You're not supposed to go around saying, "I filed a complaint and here's a copy of it," however, that's a very thin line. He said you can walk around saying, "I know Representative so and so did this, this is unethical, someone ought to file a complaint. If a complaint were filed, I'm sure he would be found guilty." He assumed you probably haven't technically violated the confidentiality provision of the statute. Number 0327 REPRESENTATIVE ELTON noted somebody that may be a complainant can walk around saying, "I'm going to file a complaint, that this person did this, as soon as I legally can." He stressed, but isn't it strange that the legislature has protected itself and can't accept the complaint until after the election and there's nothing that stops that from happening. Representative Elton indicated the protection is pretty thin. CHAIR JAMES asked are we going to condemn the reaction of public for that, are they going to contend the entire legislature of which that person is a part, or are they going to say, "Well that person didn't support that idea." She indicated she doesn't see that that's a problem when you're being general. Chair James explained that we're trying to eliminate these kinds of things as a political reason and it's very difficult to separate between ethical and political because ethical becomes political and vice versa. So what we're trying to do is make ethical as unpolitical as possible by not having these things be a part of the 45 days before an election. Number 0341 REPRESENTATIVE ELTON specified the point he is trying to make is that this gives an opportunity to somebody who wants to make a damaging political statement. This gives them the opportunity to do that without the subject being able to really respond by saying, "The committee has dismissed the complaint." CHAIR JAMES asked Representative Elton to repeat his statement. REPRESENTATIVE ELTON repeated his statement. Number 0348 REPRESENTATIVE BERKOWITZ made a motion to move Amendment P.1. CHAIR JAMES called an at-ease for approximately 12 minutes to find the missing members to establish a quorum. CHAIR JAMES asked Ms. Barnett if she could weigh in on this amendment. Number 0356 MS. BARNETT replied the amendment is just in her hand for the first time. Since she had to pick it up, she didn't get to hear the discussion. Ms. Barnett said she couldn't jump in at this point. REPRESENTATIVE ELTON asked Ms. Barnett about her comfort level with the concept of Amendment P.1. MS. BARNETT conveyed, the committee did talk about the concept and she believes individual members of the committee would feel uncomfortable with this, that it would be a concern. She said they meet so often in closed meetings, now they have all these closed periods of time when they can't accept complaints and can't issue information. Ms. Barnett stated that they haven't had a meeting to look through these amendments, but she does believe there will be a level of discomfort on several members. Number 0371 CHAIR JAMES asked for a roll call vote on conceptual Amendment P.1. Representatives Hodgins, Ivan and James voted for the amendment. Representatives Elton and Berkowitz voted against it. Therefore, Amendment P.1 passed by a vote of 3-2. Number 0376 MR. BROWN explained Amendment P.2 deals with the ban of fund- raising by elected officials who have traveled somewhere at state expense for that fund-raiser. The problem with the way it was written is that the ban precluded a... TAPE 98-52, SIDE B Number 0004 MR. BROWN continued. That same place, within the 48 hours, and still be able to have a fund-raising event. Especially those on the road system near Anchorage would be penalized by that. He indicated that wasn't the intention that was a drafting error. Sec. 17. AS 24.60.031 is amended by adding a new subsection to read: (c) A legislator may not travel at state expense to a place in which the legislator plans to hold a campaign fund raising event if the travel occurs less than 48 hours before the event is scheduled to begin. This subsection does not prohibit a legislator from holding a fund raising event in a place to which the legislator traveled at state expense if the (1) travel to the place is completed at least 48 hours before the event was scheduled to begin; (2) legislator made a trip at state expense to a place, returned from that place, and then, within 48 hours, made a second trip to the place and the cost of the second trip was not paid for at state expense; or (3) travel was to the capital city immediately before the beginning of a legislative session or from the capital city to the legislator's home immediately after the final adjournment of a regular or special legislative session. Renumber the following bill sections accordingly. Page 47, line 28: Delete: "a new subsection" Insert: "new subsections" Page 47, following line 28: Insert a new subsection to read: (d) Except for travel to the capital city, the governor or the lieutenant governor may not travel at state expense to a place in which the official plans to hold a campaign fund raising event if the travel occurs less than 48 hours before the event is scheduled to begin. This subsection does not prohibit the governor or the lieutenant governor from holding a campaign fund raising event in a place to which the official traveled at state expense if the (1) travel to the place is completed at least 48 hours before the event was scheduled to begin; (2) official made a trip at state expense to a place, returned from that place, and then, within 48 hours, made a second trip to the place and the cost of the second trip was not paid for at state expense. MR. BROWN said the prohibition doesn't exist right now. It's come up more as an issue in terms of the executive branch and concern about travel at state expense by the chief executive and then fund- raisers being held. He implied the same standard has been put in place for the governor, and the governor's home is considered to be Juneau for the purposes of the governor's term of office. Other than that, there is the same 48-hour ban and the go, come back, and go back again at personal expense or campaign expense exemption. Number 0022 REPRESENTATIVE BERKOWITZ asked what's a campaign event. If someone slips him a check, is that a campaign event. MR. BROWN responded no. REPRESENTATIVE BERKOWITZ asked if he goes around collecting checks from people that's fine. CHAIR JAMES replied, "No that's a campaign event. If somebody accidentally gives you one, or sends you one, gives you one when you're there - people do that all the time, but if you are making an effort to collect them (indisc. - interrupted) depends on who initiates it." MR. BROWN added that we would hold that standard if an invitation went out, or a public announcement was made, or there was a guest list, or someone was coordinating the event. Number 0029 REPRESENTATIVE BERKOWITZ said if he starts calling people and asking for money that doesn't seem to rise to the level of being an event. MR. BROWN said he doesn't foresee that being a problem, of course for legislators, running for legislative office, this isn't going to happen during session anyway, this is an interim concern. For the governor, as SB 275 is now on its way through the system, it's a concern year-round. He implied that it's a heightened level of concern for the governor. Number 0037 REPRESENTATIVE ELTON expressed that his heightened concern is for the governor and the lieutenant governor. He asked does this mean that if they're in Anchorage on business that they cannot have dinner with their campaign manager. MR. BROWN replied he didn't think dinner with the campaign manager is a fund-raising event. If the campaign manager invited ten employees from the timber industry to sit down with the governor, and they were told ahead of time to please bring a check, that would be an event. He expressed the public policy goal is not to have the governor fly to Anchorage at state expense and attend that dinner. REPRESENTATIVE ELTON indicated they may be discussing a fund- raising event that they will be setting up a month later. MR. BROWN responded saying that's a strategy, that's not a fund- raising event. He said they didn't want to (indisc.) in that too wide here. It was just to ban a very specific organized type of fund-raising activity. It's a public perception thing, people will say, "Gosh I saw this public official on TV this morning cutting a ribbon, and I know tonight this public official is having a fund- raiser at so and so's house, and I know that this public official traveled to and from Anchorage - is paid by the state." MR. BROWN implied Ms. Barnett recommended that if it were possible to apportion the cost of your trip, say it was 50 percent business and 50 percent campaign. He said that would be the squeaky clean way to do it, but in terms of enforcement and advising people, it just didn't seem that that was going to be a very workable statute. It seemed easier to say, if it's for state expense you travel at state expense, and if it's for campaign purposes you travel at campaign expense. Number 0056 REPRESENTATIVE IVAN IVAN indicated he can respect the intent of the legislation to correct deficiencies that occurred several years ago, but it's getting to a borderline of controlling our thinking. He said, "The governor sitting down with his campaign manager, or me sitting down with someone that will help me ... and now his thoughts are going to be controlled." CHAIR JAMES stated that she doesn't think that was the intent of the conversation. She said she thinks the intent was to try to define a fund-raising event and if it's still questionable, as to what a fund-raising event is, we might want to describe what it is and what it isn't. It's not questionable and would be easy to define. That the questions that Representative Berkowitz had - if somebody hands you an occasional check, when you're out on state business, or whatever, during a period of time, when it's okay to accept a check, that certainly is not a fund-raising event. Chair James interpreted a fund-raising event as a place where people come, they either pay to come, or they're invited to attend and to bring their checkbook to an event. This could be any kind of event where more than a certain number of people come together for that purpose. Number 0073 CHAIR JAMES said, "If any one of us has traveled ... and we talk to somebody who is a campaign chairman or something, it wouldn't necessarily happen with the legislator because the legislator is going to be traveling within their own district. ... It's 250 miles from one end of my district to the other and I live in one end, and if I go down the other end - sometimes I go down there for business and sometimes I go down there because I'm campaigning - and it's not like buying an airplane ticket because I don't fly to get there I get in my car and I drive. And then if it's legislative business I turn in the mileage and any expense I had as a legislative trip. If I'm going down there, and going to be campaigning, or having a fund-raiser or something, then I don't do that. I don't turn that in. And so there is a decision as to whether or not you're going on state business or not." CHAIR JAMES said, "But generally when you're talking about traveling some place on state business, having a fund-raiser happens a lot when we have fund-raisers in Anchorage and I'm in Fairbanks. And so if I'm going to travel down there, even if I'm traveling on fund-raising money, my campaign account is an example, and I'm going to be there for several days, I'm going to do legislative business too, which could be in an election year considered to be almost campaigning too - if I'm going to be talking to the people that I want to talk about, about future issues (indisc.) help as to how things should be addressed. We have many times caucuses in Anchorage, and then we also have a fund-raiser when we have a caucus. To me the caucus is happening because we have the fund-raiser. I'll pay my way with my campaign account to get there. In fact, we don't usually get any reimbursement for going to a caucus anyway because it's a political issue. So, the only time that I would be down there on state business is if I'm going to be there for some kind of a hearing, some kind of a committee meeting, or something to that effect. And if it happens to be that there's a fund-raiser scheduled at that same time, then I either should pay for my way to get down there, under this law, or with my campaign funds, or I should go back home and come back again, one way or the other, or I shouldn't go to the fund-raiser. Now that may affect some of the ways we've been doing things in the legislature because it is true, if we happen to have committee meetings or something and there is a fund-raiser, that there probably are some cases in the past where I was paid to go to Anchorage and back because of the committee. I don't know of any specifics, but there could have been, and I don't know that that ever happened. But it's a possibility, probably not under the current campaign finance law where you can't do any fund-raising in the off-year, then that might not be the case. And so I didn't go to any -- but they had some fund-raisers in this last campaign year for the party, I didn't go to any of them. So I know I haven't done that. But this would make it perfectly clear, that if you're going anywhere to attend a fund-raiser - and the only ones I could think of would be going to Anchorage because that is where a lot of fund-raisers are happening. You don't use state funds to get there, and I'm perfectly comfortable with that, I think it's a good thing to put into law." CHAIR JAMES said, as far as the governor is concerned she believes that is also the case. That during an election year, it can't happen in the other three years before that, and it can't happen under this current law because there can't be any fund-raising in those three years. It's only in the year of the campaign that the advantage of the governor and the lieutenant governor is (indisc.) in their being able to travel the state on governmental business, and have a fund-raiser everywhere they go. Chair James indicated that is wrong in her estimation. It doesn't make it fair if the governor can travel all over the state, having fund-raisers and campaigning, and the challengers can't. What we're trying to do is to make a level playing field. She believes this is a rational way of doing it. Number 0117 REPRESENTATIVE ELTON asked Ms. Barnett how comfortable she is now that the Legislative Ethics Committee is going to have this kind of oversight of the chief administrative officers of the State of Alaska which is under AS 24.60. MS. BARNETT replied she still doesn't have the P version of the bill but is assuming that other section, page 47, must go under 39.50 or must appear in a different part. MR. BROWN directed the members to page 1, line 21 of the amendment. He said it refers you to page 47 of Version P of the bill under the Executive Branch Ethics Act. Number 0126 REPRESENTATIVE ELTON asked how does this effect, for example, the Democratic Party. Every year it has a fund-raiser that's a golf tournament in Anchorage, how would this affect participation. If a person were in Anchorage on business, would they have to return, and then go back assuming that part of those receipts go to the Democratic Party and then to candidates? MR. BROWN replied, "Right now, all this party building fund-raising - governor's funds, House and Senate Majority fund, those are not fund-raising events for individual candidates. This ban wouldn't apply to those, this is not a very wide net, this net is cast specifically for fund-raisers for individual campaigns. And the biggest one I'd like is, it doesn't apply to campaigning it applies to fund-raising. You can still go kiss every baby you want to, and shake every hand you want to, and hand out a million little plastic flags, you just can't raise money. ... So I don't think it's an onerous intrusion upon the rights of the incumbents to continue behaving politically, it's just targeting a very specific form of their activity which is raising money for themselves. If they were raising money in the off-year for themselves, they'd be violating the Campaign Finance Act. So those have to be party fund-raisers." CHAIR JAMES reiterated that when you are raising money for your campaign, it doesn't seem right to have the expense of that fund- raiser be paid for by the state, that's the issue. She emphasized, if you get there at state expense, you better pay it back with your campaign expense. It's that simple. MS. BARNETT referred to Representative Elton's question. She said she's not quite sure that it is clear in this language that it is a fund-raising event solely for that legislator. Maybe there's a way to clean that up a little bit more. She said she's not arguing at all with the notion, or concept. Ms. Barnett said it could be confusing if there was a party fund-raiser where moneys ended up in that legislator's hand at a later point. REPRESENTATIVE BERKOWITZ said, "When the legislator plans, I think that's the determining phrase, if the party plans, it is something else." CHAIR JAMES mentioned she is also having a problem with that. She said she is thinking of some of the fund-raisers that occurred in the campaign year. In particular, a majority fund-raiser where individual checks were made out to candidates. She indicated she doesn't feel comfortable with saying that because it's a party event. MR. BROWN explained, under the Campaign Finance Act, those are reportable either as contributions to the party or to your campaign. The clarity exists in the Campaign Finance Act. He said, "You would be planning to hold an event - if there was a basket with your name on it at the event. If there was only a basket that said 'House Majority Fund' at the event - you know under the law you have no guarantee of receipt of those funds in your personal campaign even though you might be shaking people (indisc.). So I don't know how to go beyond the clarity of an APOC [Alaska Public Offices Commission] has to go on, when very likely some of those funds will end up in your campaign coffer. But they're going through the party first, and they're reportable to the party, and then the party has to report its donation to you, and someone has to make that decision." Number 0160 CHAIR JAMES reiterated that she understands the intent and that she is not comfortable with the language as well because it's not specific enough. MS. BARNETT referred to 24.60.031. She said in the existing law there is something that says a legislator or a legislative employee may not accept money from an event held during a legislative session. She said this language may help: if a substantial purpose of the event is to raise money on behalf of the member for campaign purposes MS. BARNETT stated she is a little more comfortable with that where it targets that person. CHAIR JAMES said she is willing to put Amendment P.2 aside since we will be working on it between now and Saturday to come up with something that's more definitive. MR. BROWN said, "I asked the drafter, 'Do we know what a fund- raising event is,' and she said 'yes, it's a fund-raising event,' just like you [Chair James] said. So there are times when you want to define, and there are times when you think the language is going to do the job itself. But I think it's -- if there's some gray area, that's the point of concern here is what's a fund-raising event - if it's party building, if it's a majority event. So I'm happy to work with the drafter and actually put a definition in for the purposes of the subsection of the Legislative Ethics Code and the Executive Branch Ethics Act." REPRESENTATIVE BERKOWITZ said, another thing, when you're looking at the executive branch, not all governors call Juneau home. MR. BROWN responded, "It's like a tax home. You have to take a home and not have it, you can't have two. Juneau has to be your home, it is, the governor's house is here - some governor's have chosen not to reside in it - in a very regular basis and they might take exception to that." He said he didn't know if it is possible to craft a statute to enable the governor to say, "I don't want to live in Juneau..." CHAIR JAMES said she would venture to say that wherever the governor lives that when he goes back and forth between Juneau and that place, he's paid for at state expense, so the same applies. MR. BROWN remarked that only one of them can be - he can only come home in one direction, you can't be going home both ways. He said, "If you have a suggestion about giving the Chief Executive the option of declaring some other place in the capital city his or her home for the purposes of their term office, I think it would be to that governor's disadvantage to pick some place besides Juneau, unless the governor's really not going to spend very much time here. But if the governor's really going to spend (indisc.) time here..." REPRESENTATIVE BERKOWITZ said he spends four months of the year here and this doesn't make Juneau his home. If he is living in Clark for example that would be his home. MR. BROWN said, "That's fine, but I'm going to say it's probably to your advantage, as the governor who wants to raise money. By the way he was the last governor who ran as an incumbent, right. So that's the last time we dealt with this issue really since the last two governors (indisc.) haven't run for reelection - or three. But the issue here is, do you want to be able to come back to Lake Clark and have unlimited fund-raisers within 48 hours, or do you want to be able to come back to Juneau and do that. So you can give the person the option, but they still have to pick one place." REPRESENTATIVE BERKOWITZ said he doesn't want, by law that we declare that Juneau is the governor's home. REPRESENTATIVE ELTON stated that he is not totally bothered by that. MR. BROWN said, "For the purposes of the subsection." REPRESENTATIVE BERKOWITZ reported that he's raised the point, he's thrown it out there, we've chewed on it, and now he's letting it go. Number 0196 REPRESENTATIVE HODGINS said, "While we were pondering about the definition of frivolous, I wonder if we should ponder about the definition of high-centered. I think there's some important stuff in this amendment as I pointed out earlier. My discomfort with the language was discriminatory about my situation. If I traveled to Anchorage from Kenai which I do quite a bit on state business the day before a fund-raiser, I can't really, the way the existing law is, is I cannot really accept - I have to travel on my own nickel even it's going to be for state business if it's 48 hours. This amendment allows me to make a round-trip the day of the thing at my expense and then to attend a fund-raiser which I think is very appropriate. And I would hope that we would go ahead and move this amendment, or some portion of this amendment. I don't have any problem on waiting until Saturday even though I detest Saturday meetings. As long as we don't get high-centered, I'll be here. But if we continue to get high-centered I won't be here." MR. BROWN suggested the committee adopt the amendment now. He said he can bring forward a definition of a fund-raising event, or we can take this away and come back with one remembering everything that's been discussed. Number 0209 CHAIR JAMES announced if there's no objection, we'll just set P.2 aside and deal with it again on Saturday. She said this bill is not leaving this committee without this provision in it. REPRESENTATIVE BERKOWITZ said he thinks we just got off-center. Number 0214 MR. BROWN explained Amendment P.3 deals with several small questions that have come up. He said this is a fairly substantial provision, but most of it deletes unnecessary language in the bill. The first question that was raised is whether or not it was necessary to have a reference to legislators in the disclosure requirement for lobbyists, AS 24.45, page 9 of Version P, line 24. (7) the identification of a legislator, legislative employee, or public official to whom the lobbyist is married or who is the spousal equivalent of the lobbyist; in this paragraph, "spousal equivalent" has the meaning given in AS 39.50.030(g). MR. BROWN said, "And there's something that you would probably expect to see in Amendment P.3 that's not there. You had asked me why the identification of a legislator - the reason that's in there is because we are requiring legislators to disclose because we're not banning them so that does need to be in there. I was a little scatterbrained when the question was asked of me yesterday but we have to have the identification of the legislator, legislative employee or public official because we're requiring disclosure, we're not banning them, that's why that's in there. Because we want, I would assume, to require the disclosure of..." CHAIR JAMES interjected saying they had taken the ban out. MR. BROWN replied right, the ban's gone. CHAIR JAMES indicated that she thought that the ban was still there. MR. BROWN reiterated the ban is gone, spousal lobbying is permitted - disclosure of the lobbying relationship has to be made to APOC. So that's why that's still in there. He indicated he still has an amendment to the last version of the bill that puts the ban back in with contingency language and takes the disclosure requirement out. He indicated he wasn't sure the committee wanted to revisit that issue. UNIDENTIFIED SPEAKER remarked that it's going to Finance. MR. BROWN agreed that it would be redrafted for the Finance Committee's consideration. He said, "I don't know if anyone will want to move it there but." Number 0230 MR. BROWN referred to page 10, line 23, page 11, line 5 and line 31, and then page 12, line 8 [Version P, 4/9/98]. He explained that we're changing the reference from "nongovernmental" to "nonlegislative." He said it was done up in the initial prohibition on legislative or legislative employee behavior of 24.60.03(a)(2), line 13 of Version P which has already been changed from "nongovernmental" to "nonlegislative," this goes through the rest of the section of the ethics code and changes it similarly. He indicated the drafter had asked him if he wanted to change it initially, but he never got back to her. CHAIR JAMES reiterated that this just makes it consistent throughout. Number 0237 REPRESENTATIVE BERKOWITZ referred to page 10, line 24, Version P. He said he thought that they had discussed inserting E-mail. (C) telephone or facsimile use that does not carry a special charge; MR. BROWN replied we did discuss that. He said, and then at the end of the subcommittee process we determined E-mail use never carries a special charge. It's probably subsumed under telephone or facsimile. Mr. Brown stated, "By putting it in this specific reference it would expand the committee's already probably fairly significant right to investigate the context of people's E-mails. So it doesn't afford you any more protection, if anything it would erode your protection." REPRESENTATIVE BERKOWITZ said he just wanted to make sure he can reply to his mother without getting in trouble. MR. BROWN added there's no charge for it so that should solve the problem. Number 0245 MR. BROWN explained Section 14, page 1 of Version P.3. He said the committee had recommended going in and repealing and reenacting AS 24.60.030(g). Delete all material and insert a new bill section to read: (g) Unless required by the Uniform Rules of the Alaska State Legislature, a legislator [OR LEGISLATIVE EMPLOYEE] may not vote on a question [PARTICIPATE IN LEGISLATIVE, ADMINISTRATIVE, OR POLITICAL ACTION] if the legislator [OR LEGISLATIVE EMPLOYEE] has an equity or ownership interest in a business, investment, real property, lease, or other enterprise if the interest is substantial and the effect of the action on that interest is greater than the effect on a substantial class of persons to which the legislator [OR LEGISLATIVE EMPLOYEE] belongs as a member of a profession, occupation, industry, or region. MR. BROWN mentioned that this is to prevent people from voting for bills solely to feather their own nest, of course it's a very common practice that you asked to be allowed not to vote either in a committee or on the floor. CHAIR JAMES added that you disclose your conflict. MR. BROWN agreed. He said, "The proposed language from the committee would have required a similar disclosure in writing within seven days when other actions were taken such as requesting the bill be drafted, an amendment be drafted, (indisc.) that research was done, that a memorandum was prepared on a point of a legal dispute, that you want a legal opinion on any of these actions. I suppose even a memo requesting a bill be scheduled could (indisc.) have been subsumed under this disclosure requirement for actions that are not voting. And the reason that P.3 substantially changes that is because that was thought just to be too onerous. You're not really taking action unless your voting, and to have you write a letter to the ethics committee that's going to go to the Journal every time you have an amendment drafted, it's just too much, and that the public process is definitely served by having you disclosed when votes are taken." MR. BROWN said section 14 would be amended by P.3 by shortening the existing language as opposed to putting in this much longer language. There would be no disclosure requirement when you have a bill drafted because you're not taking action in the sense that voting does. Mr. Brown reread Section 14 and concluded, "We delete the reference to legislative employee because we don't vote. There are numerous provisions in the statute that prevent a legislative employee, or a legislator from taking improper action to benefit his or her own financial interests. This is a specific provision on voting that was put into the code, and really what I think what the language in Amendment P.3 does is clean that up to make sure that you know you can't vote unless the Uniform Rules mandate that you do. And then everything up to that point is not considered taking action to the same extent." Number 0272 CHAIR JAMES called on Ms. Barnett. She said, "In the discussion that we had with the Speaker, and I agree that, although the language in the existing statute did indicate administrative or political action, it was my assumption, and also the Speaker's, that the only real action that we have that is effective is a vote and that all of these other little things that we do are not necessarily conclusive actions, they're just participation." MS. BARNETT said she thinks that in the previous language, and what the committee had recommended, was removing the prohibition and putting in some disclosure requirements, so it's a policy call. What this does, is it takes you back to a prohibition and drops the disclosure requirements. She said she believes that the committee felt, in reviewing this section, that it was fairly phony to say, "You're prohibited but that everyone always has to vote," so they preferred a more open -- at disclosure. But the bottom line is you either prohibit or loosen it up and disclose. CHAIR JAMES remarked you don't have to vote in a committee. MS. BARNETT replied correct. CHAIR JAMES said you can leave the room - which happened at the previous committee meeting. But when you're on the Floor, if there is a call on the House, unless you're excused, you must be there and you must vote. She stated that's the only place where we're forced to vote. Chair James said, "So that means still, if we're doing any voting in committees, subcommittees, wherever, if we're doing any voting, we may not vote unless - if we have a conflict. So we've actually tightened it up, because now you can vote in committee on these things, you just have to disclose." Number 0288 REPRESENTATIVE IVAN said his situation is that he probably has a conflict of interest everywhere he goes. He noted he belongs to Board of Directors of the Regional Alaska Corporation [CALISTA], he asked does that mean he can't introduce legislation as far as resource development efforts are concerned. CHAIR JAMES explained, if you're voting on the floor and you say that you are going to have a conflict because it might affect you personally, in other words you might benefit personally from your vote on the floor, and you make that disclosure on the floor you have to vote anyway. She said, "This one says that you can't vote, and I don't know exactly - in your committee I know you can leave and you can't be called back by the call of the House, you can only come back on your own will, and so that's a little different. But you could say you have a conflict and not vote in committee by this piece of legislation. I think we all have a vested interest in what we're doing. How deep does it go is that you have to have a personal financial interest the decision on that decision - a personal financial decision." Number 0297 REPRESENTATIVE IVAN asked what was in the previous law or statute before we messed with it here. CHAIR JAMES read Section 14 (g). She said, "So in other words, if you have more of an interest than other people do in this issue, financially, because of your own financial situation, then you can't participate. We're talking about participating, we're talking about having an amendment in a committee, we're talking about drafting a piece of legislation, we're talking about all sorts of participation that we do that we would not be able to do in this case without making a note to the ethics committee and telling them we did that. And we thought that was just too far reaching and not reasonable to expect us to do that and have it in statute that indicated if we don't do that it's a violation. It's just unwieldy to go that far." Chair James asked Representative Ivan if that answered his question. REPRESENTATIVE IVAN replied yes. Number 0310 REPRESENTATIVE ELTON stated he is comfortable with the amendment. He said he is putting it in terms, if we have for example an attorney whose primary caseload might be criminal law this would mean that that attorney, every time they had a change to the criminal statutes that might be before the body or before a committee, he would have to file a disclosure statement every time they asked for an amendment to be drafted. Another example would be an attorney who might have a primary practice insurance, during the tort reform debate, anytime they would have had to have an amendment drafted to the tort reform measure he would have to file a disclosure. He explained that this takes us back to the point where the only time that attorney would have to declare a conflict is when a vote was taken - and that would be a verbal declaration. CHAIR JAMES said right - which goes on the record incidently because this (indisc.) didn't get to be put in the Journal. It had to go on the record. MR. BROWN said, "The problem with the way the bill had been drafted, with all this disclosure - not only is it a flurry of paper work to Suzie - and then back down to the Chief Clerk and the Senate Secretary, but the whole anonymity of the legal drafting process - that our director of Legal Services has worked very hard to put it in place with the random letters for CSs and everything. Throw it out the window. I mean you're disclosing every amendment, your strategy as a legislator is revealed for the world to see as soon as you disclose it. And you're not taking an action - you're not really taking very much of an action, you're taking incremental steps in the process toward an action of a vote in committee or a vote on the floor. I understand what the committee wanted to accomplish but I think there's a much cleaner way to do it." Number 0323 MS. BARNETT added that it's a policy call and a prohibition versus a disclosure. She said her only concern is that a lot of action can be taken at a kind of administrative level and on influencing the administration. Ms. Barnett indicated she was a little uncomfortable pointing that out, but when you vote on a question you don't vote over an administrative action so she guesses, once that line goes in, it's only applicable to legislative action. MR. BROWN said, "Suzie [Barnett] as I said, I think you know - talking to Terry [Cramer], and tell me if I'm wrong, there are numerous other places in the code where calling and leaning on a director to do something for your behalf - that's threatening to withhold action, or to take action. You know it's already banned under the code." MS. BARNETT replied it is in this part. She indicated she is frantically looking through it because taking out legislative employees really bothers her. The section Mr. Brown was referring to only talks about legislators, so she is concerned. Ms. Barnett stated, "I'm trying to find the level of protection, you're looking at '030(e)' in existing code, and it only talks about legislators and threatening and implying. And you know we've got some highfalutin staff every once in a while that tends to lean on people. I'm trying to make sure that they aren't allowed to do that either. And I don't know if you and Terry had that discussion." MR. BROWN humorously said she [Terry] wanted to, but he leaned on her. MR. BROWN replied, "No, we didn't actually. If there's something we need to address -- that we're taking out legislative employee here, but obviously this reference Uniform Rules - it's not very well drafted. The Uniform Rules don't govern our behavior the way they govern legislative behavior. So if there's another place we need to put some prohibition in on legislative employees..." Number 0337 CHAIR JAMES interjected, she said she understands exactly what Ms. Barnett is talking about. Especially after people have been here for ten to twenty years, they do know a lot more than legislators when they first arrive and they will tell you, is true. She said, "And I remember when I was first elected and being a naive freshman, of not really up on what was happening. And someone told me that I should hire staff that's been here before, and I didn't. And quite frankly I'm really pleased that I didn't. Not that I have anything against all of the other staff - we use them too. We'll ask them things ... and they'll help us. But I think that my staff and I have learned together, and so we have a different relationship than you do if you have a staff who thinks they know more than you. And a lot of mine do know a lot more than me, but they have different knowledge than I do and we share... So I share your concern Suzie, I don't know that this is the place to fix it." MS. BARNETT replied it may, in existing law, it may be possible if we added, "a legislator or legislative employee may not directly or," and then it goes into three subsections. The parts that apply to legislative employees - then we'd have the hook to say, "Look you can't go in and strong-arm people." The parts that don't apply, voting, drafting bills, those things, providing constituent services, things that may not directly apply to employees, well then they won't apply. She said, "I guess I would prefer if we amended '030(e),' the beginning line and say, a legislator or a legislative employee may not directly, or by authorizing another to ask on their behalf to do such and such. And of course the Uniform Rules don't apply to them, so then we'd know that section didn't apply at all." Number 0353 CHAIR JAMES said we're going to be having more discussion on this piece of legislation between now and Saturday. She said she would be willing to revisit that issue for legislative staff. MR. BROWN interjected, he said he made a note of that. CHAIR JAMES continued. She stated, "Because it is a concern, ... I just want to say this because I think it is appropriate because when we're talking about term limits for legislators, and we had that discussion at length - what if anything, those ten or fifteen years of staff work have to do, and the influence that they may have had or not, or whatever, and their positions and knowledge that they have. Why is it that the public wants term limits, what is it about a legislator having been here for some number of years that they want term limits? Is it only because they want other people to have an opportunity to run, or does it have anything to do with how effective they are, so they've been here for a while, or how ingrained they are, or how much power they have, or whatever? In which case, if they have been a staff member before, which many of them have, they come ... with much more experience than the rest of us, and much more ability to do things, and pull the wool over the eyes... So the whole issue of staff is a valid one, so I think - address it in a separate way as to just exactly what they can and can't do as far as influencing the whole process because I agree that they do have an awful lot to do with it. And second of all, I also agree we couldn't be doing this work down here without them. So it's a kind of a mixed-bag. So we'll take that into further consideration. And we've got the note down here Suzie, and when we come back Saturday maybe we'll have some ideas to how to fix that." Number 0371 CHAIR JAMES said we can move on to page 14, line 31. Delete: In this section, when determining whether an employee is considered to be performing a task on government time, the committee shall consider the employee's work schedule as set by the employee's immediate supervisor. MR. BROWN said this revisits the committee's suggestion that employers set work schedules so that there's some objective standard if a complaint arises. He said this language caused a lot of concern, it's just not reflective of the reality of the way the legislature works and the people are not going to have nine to five work schedules and time clocks on the door to the office. He explained the amendment deletes the first sentence of proposed new subsection AS 24.60.030(h). It would also delete a reference to as described in this subsection. The new subsection [page 15, lines 2-7] would read: An employee who engages in political campaign activities other than incidental campaign activities [as described in this subsection] during the employee's work day shall take leave for the period of campaigning. Political campaign activities while on government time are permissible if the activities are part of the normal legislative duties of the employee, including answering telephone calls and handling incoming correspondence. MR. BROWN said there's no reference to work schedules and there's no reference to a description in this subsection, above and beyond what those words mean on their face. CHAIR JAMES indicated Ms. Barnett wanted this in here to provide backup for some of the decisions they might have to make. She said, "But sorry Suzie we just can't get this through." MS. BARNETT joking said she hasn't been a staff person long enough, she's just not powerful enough. Number 0386 MR. BROWN referred to page 21 of the CS. He said, "This is a banner day for dead people in the House State Affairs Committee. This deletes the reference to reporting requirements for inheritances. Right now there's some question as to whether or not an inheritance is a gift. No one has really alleged that it necessarily is successfully, but this would have made them confidentially disclosable. But really the question is, is how much influence can the dead buy... This just deletes inheritances all together, and reletter the following subsections accordingly." Number 0393 MR. BROWN referred to page 22, [lines 2-3]. He said this deletes the reference at the end of the subsection that allows you to have a JTPA (Job Training Partnership Act) or a university intern without violating your gift requirements. Delete: This subsection does not permit a legislator or legislative employee to accept a gift of services for nonlegislative purposes. MR. BROWN stated the concern was that language might interfere with volunteers helping in your campaign. He said, "So if we strike it, it certainly is not going to allow BP [British Petroleum] to pay for a maid at your house - which is prohibited under other areas of the code. The language was in there to make sure that no one tries to use the allowance for volunteer services - to let them have BP (indisc.) a maid at their house I suppose, or whatever the sensible possible violation was. It does not weaken the gift part of the statute at all, it just makes sure that no one reads it and gets concerned about it I think." CHAIR JAMES agreed that it raised a lot of concern. She said they just didn't understand why it had to be there. Number 0402 MR. BROWN referred to page 23, line 26. He explained we are getting rid of a secondary reference to the inheritance because we are no longer going to disclose those. (5) receipt of an inheritance under AS 24.60.080(i); Number 0404 CHAIR JAMES announced this completes the explanation of Amendment P.3. She asked if there were any objections. There being none, Amendment P.3 was adopted. TAPE 98-53, SIDE A Number 0004 [There's discussion as to where Amendment P.4 would fit into Version P.] CHAIR JAMES indicated she doesn't like the new amendment. MR. BROWN said this will probably go on page 37, where Section 60 is and we would renumber the following sections accordingly. CHAIR JAMES asked Representative Berkowitz to move his amendment. Number 0015 REPRESENTATIVE BERKOWITZ made a motion to adopt conceptual Amendment P.4 which relates to open meeting requirements. He said, "It's a very simple concept, we've been trying it in the Minority for a while and its been very successful. People come, and may come again to our meetings, and we've been able to actually have strategy sessions with the press there, with members of the public, and it hasn't hurt anything. I think the whole argument about open meetings is that it fosters public confidence in the process. And I know, as a member of the Minority, who's never been a member of the Majority, how distressing it is to find that the Majority disappears behind closed doors and things get rearranged. And it certainly doesn't do much for my confidence in the way the process works." CHAIR JAMES stated she could probably tell him [Representative Berkowitz], with a good conscience that if suddenly he was to come back next year and be in the Majority that he might have a different attitude toward that, unless he wants to have a no Majority-Minority system, a no caucus system. She indicated she understands his position on this issue and much of it distresses her as well. But having been part of the Majority certainly see the benefits of it. REPRESENTATIVE BERKOWITZ further explained to make it clearer you can close caucuses if strategy is being discussed. CHAIR JAMES said she understands, that's why we do that. REPRESENTATIVE BERKOWITZ remarked, so am I to understand that the majority has never discussed anything but strategy in a caucus. CHAIR JAMES replied that's true. UNIDENTIFIED SPEAKER said "wow." REPRESENTATIVE ELTON said, the reason he favors this amendment is we're applying to ourselves, the same that this legislature has applied to every other public body in the state, and he thinks that's only fair and just. CHAIR JAMES asked if there were any objections to proposed Amendment P.4. Number 0035 REPRESENTATIVE HODGINS objected. REPRESENTATIVE BERKOWITZ said to Representative Hodgins, "I thought you were going to support it." REPRESENTATIVE HODGINS asked, "What's that on page 21." REPRESENTATIVE BERKOWITZ replied he will shift it to page 21 if that's what it will take. Number 0038 CHAIR JAMES asked for a roll call vote. Representatives Berkowitz and Elton voted in support of the amendment. Representatives Hodgins, Ivan and James voted against it. Therefore, Amendment P.4 failed by a vote of 3-2. CHAIR JAMES mentioned she would keep the amendment since she didn't have the time to fully read it. She indicated she didn't like the "dark" print. REPRESENTATIVE BERKOWITZ jokingly implied it's the light. CHAIR JAMES mentioned she will read it because she wants to see what the benefits are. Number 0044 REPRESENTATIVE HODGINS referred to page 21, lines 3, 4, and part of 5 of Amendment P. He noted they discussed immediate family as a grandparent, aunt or uncle, and finds that difficult unless they reside in the same household. A distant aunt would then be considered immediate family. Representative Hodgins stated he would like to have a little discussion on whether we need sections (4) and (5). (4) a parent, sibling, grandparent, aunt, or uncle of the person; and (5) a parent, sibling, grandparent, aunt, or uncle of the person's spouse or the person's spousal equivalent CHAIR JAMES said she understood what he was saying and asked would we need a qualifier. MR. BROWN explained the current definition of immediate family. He said this definition applies to the gifts section of the legislative ethics statute. The current definition is immediate family as the meaning given in AS 24.69.990.85 which are definitions for the legislative ethics statue and includes the grandparents, aunts and uncles of the person, and also includes the person described in this subsection who's related to the person by marriage. Mr. Brown asked Ms. Barnett to speak to the desirability of requiring people to consider these somewhat distant, perhaps geographically or residentially distant relatives of family members. Number 0063 MS. BARNETT said she understands Representative Hodgins concern in this section. She said she believes he wants it broader. He wants the largest definition of family possible because the broader the definition the more gifts you can accept that obviously are from family. And they aren't trying to influence you, and you don't have to disclose them, you don't have to think about them. MS. BARNETT stated again that she doesn't have Version P or Amendment P.4 in front of her. But whichever of the two, the existing one or the one that he is trying to get to, she recommended whichever is broader. MR. BROWN said, "If I recall correctly, the broader one is the one that lists everyone out here, that's why we don't see any language. So this is a permissive (indisc.) definition. These are people that can give you gifts that are immediate family that don't (indisc.) requirements under the gift limits of the code." REPRESENTATIVE HODGINS stated his curiosity was, if you have a definition in one section, does that carry over as definitions to other sections if not explicitly stated. CHAIR JAMES replied she doesn't believe it does. It says, in this section immediate family means - only in this section. Number 0077 MS. BARNETT said, to help clarify, in the other sections, for example, in some places you want broad - acceptance of gifts, she thinks it makes absolute sense and the public would agree. They don't care who in your family gives you something. Ms. Barnett said, "But when we get to contracts, for example we talk about family members and what family members can accept, you want narrow. You want those people with whom you actually have a contact. That's, Representative Hodgins, I think exactly where you want to get narrow, and where you say people that you would know what was going on." CHAIR JAMES asked how narrow are we there. The other thing is when you're disclosing a conflict of yourself or your family member. MR. BROWN pointed out that that's under proposed Section 18 of Version P. He said, there the definition is family member, not immediate family member, and the definition that we referred to, Suzie, is the one that's going to go into the entire code, right. UNIDENTIFIED SPEAKER replied Section 60. Number 0089 REPRESENTATIVE BERKOWITZ asked why this doesn't include step family. CHAIR JAMES said this one doesn't say what the immediate family is. UNIDENTIFIED SPEAKER referred to page 37, Section 60, lines 11-16. (5) "immediate family" means (A) the spouse or spousal equivalent of the person; or (B) a parent, child [, PARENTS, CHILDREN], including a stepchild and an adoptive child, and sibling [SIBLINGS] of a person if the parent, child, or sibling resides with the person, if financially dependent on the person, or shares a substantial financial interest with the person; MR. BROWN explained that's the definition applying to the entire code, and there, there has to be financial dependence. It's much, much, much narrower. MS. BARNETT recommends this approach overall. She said, so that you have broad in the gift section, narrow in the others. So that you are aware of your family member's activities and you only have to really deal with the ones where you would know, or you would have knowledge. REPRESENTATIVE HODGINS said that answers his question. Number 0099 REPRESENTATIVE IVAN asked to have the gift section to the family members summarized. MR. BROWN said basically it will enable you to receive gifts from immediate family and not violate the gift restrictions. He said, "You can get a more than $250 gift. I guess - if a lobbyist is your family member does that exempt you as well. Suzie, has that come up." MS. BARNETT replied if you are married to a lobbyist, you are allowed to accept anything from the lobbyist. MR. BROWN stated and you wouldn't be otherwise, but if... CHAIR JAMES added, but if it was your brother or sister, or somebody. MS. BARNETT replied the family member overrides the lobbyist prohibition. MR. BROWN stated that everyone on this list can give you stuff that otherwise would be a violation of the gifts code. He indicated it's the good part of the bill. Number 0107 REPRESENTATIVE BERKOWITZ asked if it could be expanded to include step families. MR. BROWN replied he thought it did for gifts. CHAIR JAMES noted it does for gifts, but it doesn't... REPRESENTATIVE BERKOWITZ pointed out that it refers to step child but it doesn't refer to step parents or step grand parents. CHAIR JAMES asked what page was that on. MR. BROWN replied page 21 of Version P. He asked Ms. Barnett what would the committee's feelings be on allowing other step family members. Number 0014 MS. BARNETT said she thinks that's a logical, common sense approach to say step family. CHAIR JAMES asked where would we add it. MR. BROWN replied under (4) we would say, "a parent, sibling, grandparent, aunt, or uncle of the person or a step parent, step sibling, step grandparent, step aunt, or step uncle." REPRESENTATIVE BERKOWITZ noted it also doesn't include in-laws. MR. BROWN said it does under (5) "a parent, sibling, grandparent, aunt, or uncle of the person's spouse or the person's spousal equivalent." He asked, do we include step in-laws. You can either add the step reference to (4) and (5), or only to (4). Mr. Brown said, "And since Suzie doesn't think the committee doesn't have a problem with it - so I'm happy to bring back whatever sort of amendment the committee would like to see on Saturday." CHAIR JAMES asked him to please do that. MR. BROWN asked with just (4), or (4) and (5). REPRESENTATIVE BERKOWITZ replied both. MR. BROWN asked Chair James if we could allow Mr. Slotnick to briefly address his concern about the constitutionality of the way we've tweaked the Personnel Board stuff because it's going to be in an amendment on Saturday. He thought this would be helpful. REPRESENTATIVE HODGINS humorously asked if we were to allow cousins, would that give Representative Ivan an unfair advantage. Number 0134 NEIL SLOTNICK, Assistant Attorney General, Commercial Section, Department of Law, came before the committee. He said he wants to go over briefly one of the actions this committee took last week in adopting Amendment L.1. Amendment L.1 came out of the subcommittee that was meeting on SB 105 and concerns the Executive Branch Ethics Act. One of the provisions that the subcommittee decided on was that they would like to see a little more oversight of the attorney general's settlement authority of ethics complaints under the existing law. As it works right now, the attorney general can dismiss an ethics complaint if he finds that it's not warranted, or can settle it with the subject of the complaint. Under existing law, all the attorney general has to do is file a summary of the action taken with the Personnel Board. What the subcommittee asked for was that the Personnel Board be granted the power of review. What the amendment adopted last week did was to give the Personnel Board the power to order the subject, order the complainant, and have the attorney general appear before them, undertake a review of the dismissal or plea bargain, if you will, and then issue a report, and that's all noncontroversial. Then, ask me if we can take it one step further and let all of that go public. And I advised him, yes you can do that but you have to give the subject a hearing because the subject has been accused of things and would have to have a chance to clear his or her name. Number 0145 NEIL SLOTNICK said he was a little hasty in his advice. What we did is we drafted the provision that says, "If given a hearing, the Personnel Board can go public," and that's not enough. Just on common sense, that's not enough, when the Personnel Board doesn't have to make any findings that there's substantial evidence, it can just go public after giving a hearing. After doing a little research he determined that's unconstitutional, in fact, our constitution has a special Anti McCarthyism provision in it that people have to be protected from legislative and executive hearings and reports. What Mr. Slotnick suggested, and this is something we can take up on Saturday, is if there's a need to let the Personnel Board let the matter become public, that we let the court decide because the court can make the determination, "Is there substantial evidence to support some of the allegations." The court can make the determination, "Is the subject's constitutional rights protected by letting this report go public." So, he redrafted, for our review, this provision only regarding when the matter is made public. Mr. Slotnick said, "And the truth is, that's really not going to be that much of a problem. Very often, when we resolve matters in the plea bargain arena, we go public anyway, even though we're not required to, we ask the subject to agree if you're - 'You know we'll cut a deal with you if you will agree to make this public.' And so often these matters are public anyway and would only arise in the situation where the Personnel Board was dissatisfied with the dismissal, or the plea bargain that the attorney general entered into. So I suggest..." Number 0164 CHAIR JAMES interjected, "Having been a member of the LB&A [Legislative Budget and Audit Committee], ... did the auditor discuss this at all with the (indisc.) if that is what the auditor was wanting in this case. It doesn't seem to me like that was. We had a situation, and it was in an executive session so I'm limited as to what I can say about that, but the conclusion was that the auditor wasn't even able to tell us in LB&A because of the secrecy over a particular personnel situation. So we didn't even get to know very much about it because of that disclosure. And the comment by the auditor is that the lid ought not be quite so tight when state funds are involved, particularly as we are LB&A Committee. And so that was the issue there, and it seems to me like this issue is different - that we have in this amendment." MR. SLOTNICK replied he believes that's true. He said he thinks this issue grew out of concern about just oversight of the attorney general's action. Which he believes is what prompted the original Senate change to the Executive Branch Ethics Act. He indicated the legislative auditor did contact him about a situation and he sent over a proposed amendment which is included in here to tighten up disclosure. But the auditor did not discuss the concept of when matters can be made public. Mr. Slotnick said he thinks individuals have a constitutional right to privacy, and to protection to avoid having the government so leak their name. Number 0181 CHAIR JAMES indicated her understanding of the situation, it was however, there are two personal cases that are out there that are generally private. They are ones that either were dismissed by the attorney general, or settled. In other words if there's a settlement, there's an admission that there's a problem but it's settled and best thought let that be the end of it as opposed to going onto a hearing. She asked Mr. Slotnick if he was saying that due process is not provided a totally --for the publication of a settlement because that person's due process is short-circuited in some way. MR. SLOTNICK replied, "Yes, that's exactly what I'm saying. That person has entered into a settlement, and if the settlement is confidential, if that's a provision of the settlement, then that's what they've bargained for. It's an understanding that their name and these accusations against them will never be made public. And maybe they gave up the right to defend themselves, just to save money. For example, 'I'll pay $250 if this (indisc.) go away, but I never did any wrong doing.' Well, that's your version and so and so forth, that's plea bargaining is, if that's what they bargained for. And then someone else comes along and says, 'Well, I'm going to make this public anyway and make public these accusations against you,' where you've never had a hearing, and an opportunity to cross-examine witnesses against you, then I would consider that to be a violation of due process." MR. SLOTNICK mentioned he advised Ben [Mr. Brown] we need to give him a hearing. But when you read this, all it says is they get a hearing, it doesn't say they get to cross-examine witnesses... Number 0198 CHAIR JAMES interjected, she said she understands that part of it totally. Chair James stated, "To try to get my finger on what the real problem is, is when there is a misuse of state funds. Which is not necessarily all of the complaints that might be filed, it's just one of the complaints that might be filed. And that's more of a personnel matter than it is an ethics issue. All ethics doesn't necessarily have to have money attached, it might in some indirect way. But if there's been a misuse of state funds, that's more than an ethics complaint." CHAIR JAMES said, for example, the City of North Pole had a clerk who admitted using the city's credit card for personal purchases because she was able to receive a discount. And it was published in the paper. She pointed out that was the original complaint, then the mayor negotiated with the clerk and she reimbursed the city. Supposedly she said, 'okay the problem's gone away.' But the city council said it didn't go away, there was theft. So you don't just pay the money back and go away when there is theft in a government agency and using public funds. Then they did an audit and come to find out that wasn't all she did so now she's in court. Had the city council been happy with just the reimbursement that wouldn't have become more public than that. That's a personnel issue, and now she's going to have a court decision. But in the mean time the paper tells it all, so she's not protected even though she might have had an agreement. Number 0217 CHAIR JAMES continued. She said she's not saying anything like that would happen in state government because this was a small city situation. However, we're only the strength of the weakest link, and so there are those kinds of things that can happen. She stated, "I suppose if it's a lot of funds, that it would be something the Office of the Attorney General would decide going on with to a hearing. If it's an insignificant thing, or maybe there was some misunderstanding of whatever was useable (indisc.). And we had another case like that in Fairbanks where someone was operating on public funds and they left, or something, and they took their vacation and paid themselves. ... And then they said, 'Wait a minute, you don't have a right to do that - so now you thieves.' Well, come to find out the court said no, they didn't thieve. But that had to go through that whole process, so that was the due process part. Would we believe then, we the public, and we the legislators, and whoever is responsible for that state funds, that if there was an obvious intent ... to misuse government funds that we wouldn't be doing any plea bargaining? But if it was misuse of state funds, and it was not intended but just a mistake in understanding or something like that, that then you could have plea bargaining. Would that be a correct assumption? So that we really don't have anything to worry about in this issue because it's not made public. I guess my question is, should we have more protection over the misuse of state funds than we currently have." Number 0233 MR. SLOTNICK said, "To answer your question, to be absolutely certain that there would be no plea bargaining in the situation that you've described, I think that you'd have to be put that into law. I can think of lots of reasons why - even such a case as you've described, might be plea-bargained away. What, at least the version that I am suggesting here does, is it would give an interested party an opportunity to go into court and ask the court to order publication of the matter." CHAIR JAMES asked, and that will fix the whole issue. MR. BROWN said that may be constitutional, but the interested party is probably going to be the Anchorage Daily News, it's what this comes down to. If the Personnel Board issues an anonymous or pseudonymous critical report (indisc.) the attorney general and the dismissal or resolution, unless... CHAIR JAMES remarked we're talking about the public, we're always talking about the media, we're not talking about Johnny on the street, it's the media that is the public. MR. BROWN continued. He stated it's very easy to see the Personnel Board being able to use its bully pulpit, criticizing the attorney general's handling of a matter to provoke a quite substantial media response. He said he doesn't fault Neil's (indisc.). Number 0243 CHAIR JAMES mentioned she is very sensitive to this issue because she believes they want to serve the public in the way the public needs to be served. She said we also know, that when we serve the public, they some times go overboard and then people get hurt when they really shouldn't necessarily be. She indicated it's a balance that we want to achieve. But she doesn't know the answer because it's beyond her scope of knowledge as to what generally happens, that's why she's asking those questions. Chair James suggested they talk about this more to see if this hearing issue is enough, and whether we should do this. MR. SLOTNICK stated the other option, of course would be to not necessarily go this far, to not include the court provision for going public and just keep it as is. He said he agrees with Representative James that it's a good policy that plea bargains are nonpublic plea bargains be avoided when there's substantial misuse of funds. But he can easily imagine circumstances where it's in the best interest of the state, and limited resources, and the bill (indisc.) of enforcement funds to enter into a plea bargain. And some times the only way you can get it is to agree to make it nonpublic. So that will happen, particularly when there's cloudy issues of proof, and witnesses, and you know if you're the attorney general, you're not sure if you're going to prevail at hearing anyway, lots of reasons. Number 0256 CHAIR JAMES said she can also think of lots of reasons, but being on the outside looking in, she can see the demanding public saying, "None of those reasons count." What's in the best interest to them is totally different from ours. She mentioned they have this argument almost on a daily basis on what's in the best interest of all of us and is questionable in each one of our minds. Where is the line, and when do you want to cross it or not? She said she will try to talk to Pat Davidson today and will report to the committee and define what it is that she was concerned about. MR. BROWN informed the committee that he had talked to Pat Davidson and had an amendment drafted to put in a specific provision into the Personnel Act, which was Amendment L.7, which we didn't take up last week because it's probably not within a single subject to this bill. He said, "And to effect the change she wants in the Personnel Act, regarding the confidentiality of information about the use of state funds - which we might have some language problems - Mike [McMullen] thinks anyway. It may require a separate bill that just does that, by request of LB&A or the Rules Committee." He pointed out we've put everything possible into this bill, within the title that we can and there are limits, so the answer may be a separate piece of fast-track legislation. CHAIR JAMES replied we don't need to fast-track, we can come back with it next year. She said she thinks we've fast-tracked enough stuff already. CHAIR JAMES announced the committee will take Mr. Slotnick's changes into consideration on Saturday. She indicated they will bring SB 105 up after the Rail Road Right-of-Way hearing.