SENATE BILL 358 "An Act relating to the disclosure of certain personnel records that include information about the use of public resources." Senator Pearce explained that SB 358 was the result of findings from a legislative audit made on the Division of Vocational Rehabilitation in the Department of Education (DOE). She added that the audit had recently been released at a Legislative Budget and Audit Committee meeting. PAT DAVIDSON, LEGISLATIVE AUDITOR, DIVISION OF LEGISLATIVE AUDIT, informed the committee that during course of the DOE Division of Vocational Rehabilitation audit, the legislative auditors were asked to review various allegations. The conclusions of the audit were contained in the recently released report. However, certain information was found that could not be disclosed because it was considered private under the Personnel Act. The items that could not be discussed in public had to do with state financial transactions. Legislative Audit believed that there should not be prohibitions on how state money was spent; SB 358 would amend the personnel actions and would allow public disclosure of the use and the amount of state funds, for whatever purpose. MIKE MCMULLEN, PERSONNEL MANAGER, DIVISION OF PERSONNEL, DEPARTMENT OF ADMINISTRATION, testified that the position of the Department of Administration (DOA) was that the bill would not fix the perceived problem in the right way. He stated that trying to fix the personnel record section in statute to deal with the issue would be misplaced since the financial documents were not personnel records. He did not know the solution but was willing to work with the Division of Finance to find one. He referred to the first and third sentences of the bill. The second sentence would reverse a long-standing practice of what the department considered public information under AS 39.25.080 (authorized employee compensation). The department believed that compensation was authorized before it got paid, so that all compensation was reportable in a gross amount; on that basis, the Division of Finance had been able to periodically release lists of employees who made more than $50,000, more than the governor, or other numbers to the legislature and the press. The information was considered public; the second sentence would reverse that and force the department to release only something like the authorized range and step and bargaining unit. He believed the department would not be able to respond to inquiries. Senator Adams echoed concerns stated earlier related to page 1, lines 7 and 8. He believed information was being hidden from the public. He queried suggestions for fixing the problem. Mr. McMullen suggested leaving the second sentence out and moving the rest of the language someplace else in statute related to public finances; the issue was not personnel records but financial records. In response to a question by Senator Pearce, Ms. Davidson addressed concerns brought up by DOA, beginning with the question of why the language was not in statute under the Personnel Act. She explained that the instance the auditors had come across related to certain financial transactions that were wrapped around a personnel disciplinary action, based on rules about what a disciplinary or a personnel action was. The Division of Legislative Audit had recommended the measure be placed where it was so that confidentiality did not include limiting public access to information about the use of public funds. Ms. Davidson reported that the second sentence was put in by Legislative Legal Services when the bill was drafted. She believed the concerns related to using the words "actual amount paid" because while information about gross pay was public, certain deductions, withholdings, and so on were confidential and therefore should not be available to the public. Legislative Legal had used the language for clarification. Senator Pearce (unclear and faint recording) referred to the public nature of pay received by legislators. She questioned why the information could not be made public. Mr. McMullen responded that DOA was willing to do whatever it could within broad constitutional protections of rights to privacy. He claimed there were several ways to address an employee who did something wrong. For example, criminal activity could be prosecuted under criminal law, while violation of the Alaska Executive Branch Ethics Act could be dealt with another way. Employee discipline could also be used. The only option that seemed to fall under AS 39.25.080 was the employee discipline option. The department believed that the financial transactions that were the basis for finding the employee guilty were public documents. The Division of Finance had considered the issue and determined that the financial parts were already public records. He understood that the two issues (the action taken on the employee and the actions that were the basis for taking the action) were intertwined. He was willing to work on sorting the issues, including working with the auditors. Co-chair Sharp opined that the statement sounded "like garbage" and suggesting moving the bill. Senator Pearce thought more work could be done. She stated concerns about accountability regarding the process because of other issues. The public could not find out what the disciplinary actions were in at least one case involving alleged misuse of access to a private individual's police records. She referred to an employee who got a promotion, and "special prosecution" by the Department of Law. She did not feel comfortable with the level of public access. She agreed that the bill should be moved from committee. She stated that she wanted the auditor and not Legislative Legal to work with the department on streamlining language, but she did not want to hold the bill in committee. Co-chair Sharp agreed. He thought any attempt to bring in three or four departments to work on something in the last ten days of the session in the house of origin was a stonewall tactic. He did not want to hold a bill when there were no solid suggestions regarding what to do about the problems. Senator Torgerson MOVED to REPORT SB 358 out of committee with individual recommendations and the attached fiscal note. Senator Adams commented that he had problems with line 7 but would not be opposing the motion. There being no OJBECTION, it was so ordered. SB 358 was REPORTED out of committee with no recommendation and attached zero impact fiscal note by the Office of the Governor.