SENATOR KELLY opened the meeting with SB 76 (CHARITABLE GAMING RESTRICTIONS) and invited the sponsor, SENATOR DRUE PEARCE, to testify on her bill. SENATOR PEARCE explained SB 76 would achieve two things. First, it would return gaming profits to worthwhile charitable organizations. She attested to substantial amounts of gaming proceeds, which are currently being contributed directly to Alaskan political campaigns, to the extent of $600 thousand reported for 1990 and 1991. She thought this diversion of funds should be returned to a list of worthwhile organizations. SENATOR PEARCE said the second affect of the bill would reduce the criminal elements from establishing a foothold in Alaska's gaming industry, since it would prohibit felons from gaming in any supervisory or managerial capacity. She listed six definitions for this prohibition beginning with being responsible for gaming receipts on through to being a fund raiser or consultant. SENATOR PEARCE praised Nevada for recognizing that any hint of impropriety is unacceptable, and she described how they excluded parking-lot attendants from employment if they had a criminal record. She suggested it was time Alaska cleaned up its gaming industry. Number 071 SENATOR RIEGER asked about the phrase, theft and dishonest, and asked for a legal definition of dishonesty. SENATOR PEARCE passed the question to GARY AMENDOLA, Assistant Attorney General, for a legal definition. MR AMENDOLA said there is a legal definition for dishonesty. He explained it isn't a term of art in the law, but has an easily understood meaning, and he gave the example of robbing a bank as dishonesty. Perjury would be a crime of dishonesty. He said the Department of Law has not yet adopted regulations to define dishonesty, and in the present legislation, he didn't see a problem in figuring out which ones involve theft and dishonesty. SENATOR KELLY asked COMMISSIONER PAUL FUHS if he wished to testify. COMMISSIONER FUHS testified in favor of SB 76, and he referred to a state-by-state comparison guide, compiled by the Gaming Section, to show what other states allow pertaining to licensing. He reviewed the statistics that show the states with the highest levels of gambling activity do have denial-for-life for convicted felons. COMMISSIONER FUHS said Alaska was the only state surveyed that allowed gaming for political campaigns, but he thought it was clear that political campaigns were not a charity. He outlined a possible conflict-of-interest between legislators and regulating the gaming industry. He said a report would be out in March showing which candidates received money - at present a legal contribution. Number 138 SENATOR KELLY expressed concern that people, who are sent to prison, are not allowed to work at anything but crime when they return. He asked for a list of occupations, licenses, and professions in which felons may not be employed. JOHN HANSON, Gaming Manager for the Department of Commerce and Economic Development, said he was only aware of two, with gaming being one where there is a background check. He said the other was collection agencies, which also requires a background check, and felons can also be bared for life. SENATOR KELLY asked if a person could get a law license if they were convicted of a felony. MR. HANSON explained it was a board not under occupational licensing. SENATOR KELLY asked if a person could go to work for the state if they had been convicted of a felony. MR. HANSON thought they might, but his department doesn't control that either. He also explained there was a question on the state application for classified employment relating to whether a person has been convicted of a felony. They discussed several aspects of this question in relation to being a real estate agent. Number 194 SENATOR KELLY and MR. HANSON returned to the subject of gaming, theft, felony convictions, and being bared for life. SENATOR KELLY was concerned there were people bared from employment, who had committed crimes many years ago. SENATOR PEARCE suggested that drug trafficking should join the list of those prohibited from managing a gaming establishment. MR. HANSON said the people mentioned by SENATOR KELLY could still work in lesser categories of responsibility in gaming. SENATOR KELLY asked if these persons could own the gaming establishment, and MR. HANSON explained the games were conducted by permitees, who can hire persons or contract to use an operator. Since an operator could not have a felony conviction, his answer to SENATOR KELLY'S question was no. Number 232 SENATOR KELLY asked for a list of what can not be done by a convicted felon in Alaska. MR. HANSON said he would try to provide such a list. SENATOR KELLY thought there should be more opportunities for a person to redeem their mistake. MR. HANSON, in discussion with SENATOR KELLY, recalled that a felon could not get other types of licenses such as a beverage dispensary license to sell beer or wine. SENATOR KELLY was sure there were more, even for minor offenses. SENATOR LINCOLN asked SENATOR PEARCE why the prohibition was moved from 5 years to for-ever. SENATOR PEARCE began by stating she didn't think there should be gaming in Alaska, charitable or otherwise, and she explained her thinking as a product of where she was raised. She was raised on a farm that also raised race horses, and she drew on her experience with race tracks, which had to be operated without any criminal elements. SENATOR PEARCE said gaming in Alaska was a $200 million business, and she reviewed the number of problems generated by the industry. She claimed Alaska is lacking in the infrastructure to manage the gaming industry, and reiterated that convicted felons should be prohibited (forever) from working in a management position in the gaming industry. SENATOR PEARCE reviewed her previous bill on the same subject that would have prohibited family members of convicted felons from operating gaming businesses. She said public radio and TV have been allowed to expand the gaming industry in the state, and she discussed the ramifications. SENATOR PEARCE said she was fearful that organized crime would try to take over the state. Number 309 SENATOR LINCOLN thought SENATOR PEARCE'S fears were for the urban setting, but she was concerned about the small communities in her district, where bingo would fall under a charitable game activity. She said few people could volunteer their time, and she didn't know who in the small communities might be a felon. SENATOR LINCOLN asked what would happen in a small community where a volunteer runs a small bingo game if that individual is found to be a felon. She explained the bingo receipts are used for charitable uses such as providing transportation for patients who cannot pay to go to the hospital. She asked who is responsible for checking the person running the bingo game. SENATOR LINCOLN'S second question concerned a person who was paid a small amount to run the bingo game, and again, who is responsible for checking that person's record. Number 334 MR. HANSON said, under current law, his department or the organization designates the person responsible for the game, usually by a board resolution appointing a member-in-charge. This member-in-charge is the one given a background check. In the case of paid employees, a list of the persons, with their social security numbers, is sent to Occupational Licensing for a background check. A felony conviction under five years old, or a crime of theft or dishonesty, would disqualify a potential person from running a bingo game. MR. HANSON, in reference to a question by SENATOR KELLY on investigations, said there was a common element - a criminal record. He explained there were people, who have murdered or attempted to murder, who are not prohibited from running a gaming business. SENATOR KELLY asked if there was a convicted murderer in gaming today, and MR. HANSON said that was correct. He said these were the persons causing the most problems. Number 358 SENATOR LINCOLN asked MR. HANSON if he had a list of those individuals by region that have been denied a permit application or an operator's license. She indicated an interest in knowing how many were in the small communities that have been denied, in comparison with the larger regions. SENATOR LINCOLN was concerned there would be a blanket prohibition to close the door to those who are trying to run an honest operation. MR. HANSON said he could provide SENATOR LINCOLN with a list of those with prohibitive criminal records - about ten people. He said some of the employees actually conduct the gambling activity, thus they didn't fall into the managerial category. He explained several important aspects, including posting security, and the statutory language. He referred to a variety of crimes that would fit into the category of "theft and dishonesty." SENATOR KELLY discussed the list of those denied managerial jobs with MR. HANSON, and SENATOR KELLY asked for a specific list of crimes - not the names. MR. HANSON described other crimes he would like to see on the restricted list. Number 411 MR. HANSON explained to SENATOR LINCOLN how the denial process worked in relation to managerial people and in some cases operator applications were denied because of criminal records. SENATOR LINCOLN asked if they were included in the 10 names on the denial list, and MR. HANSON said they were. SENATOR LINCOLN suggested the sponsor wanted to prohibit those individuals who have a record, but MR. HANSON can't prohibit today. MR. HANSON admitted this was true, and expanded on his reasons. In answer to questions by SENATOR KELLY, MR. HANSON described how he would like to see the process work with investigations and assistance from the law enforcement agency on white collar crime. There are only two people in Alaska who work on white collar crimes, and this is not a high priority with law enforcement, because of the press of more serious crimes. SENATOR KELLY asked how many people would be denied gaming jobs if SB 76 were passed now, but MR. HANSON was unable to give a firm number. He explained, as the licensing took place every year, more people would be denied licenses. Number 439 SENATOR KELLY invited CHIP TOMA to testify. MR. TOMA testified that technically he is a felon, and technically not a felon, and he explained how this came about in what he also explained was a sting operation aimed at apprehending politicians. MR. TOMA accused the governor of illegally obtaining his record, publicizing it, and classifying him as a felon all over again. After disclosing the case against him, MR. TOMA said he resented being prohibited from many forms of employment. He also claimed he opposed all forms of gambling, but he also opposed prohibiting any type of organization, based on the politics, to engage in something which is now legal. Number 460 After talking to many of the people involved in gaming in Alaska, MR. TOMA concluded the operators of the pull-tab operations were thieves, only returning 4% of the gross product - sometimes. He explained it was only the political parties that conducted the games in a proper manner, where the members of the group selflessly sold the tickets and were accountable. MR. TOMA thought that was the only way the games should be conducted throughout the state. He praised the political parties for doing this and admonished those groups that hired the thieving operators. MR. TOMA returned to his first choice, which was to eliminate gambling, because it took money from poor people. He talked about the difficulty the political parties have in raising money for political candidates, who then resort to $1000 lobbyists. SENATOR PEARCE said her legislation did not prohibit political parties from having a permit, but would prohibit the direct contribution to a specific candidate's campaign. Number 493 MR. TOMA explained he had been involved with the Democratic party since 1970, and he claimed that every cent that was raised went to the candidates, but was not used for the promotion of the party. SENATOR KELLY asked MR. TOMA how many job classifications he was prohibited from taking in Alaska, because of his felony background. MR. TOMA said he was aware of two: school teaching and school bus driving. Managing a gaming operation would be the third. There was a discussion of a number of former felons who lobby the legislature. He said he couldn't be a police officer, or have any type of public safety job, although he was once a fireman on the North Slope. MR. FUHS quoted MR. HANSON that with MR. TOMA'S suspended sentence, he would be able to manage a gambling operation in Alaska, and the political parties would be able to raise money under SB 76 for charitable purposes, but not for specific candidates. SENATOR KELLY said he wanted more information on what jobs are prohibited to felons, and he reiterated his concerns about employment for those who have paid their debt to society. Number 529 SENATOR RIEGER thought SENATOR KELLY had raised some good points, but he didn't think charitable gaming was an option he would want to consider. SENATOR LINCOLN said she would like to hear the response and see a report from MR. HANSEN on SENATOR KELLY'S questions, as well as the list she previously requested. She said she needed more information to be able to act in good faith on the bill. SENATOR KELLY said he would hold the bill for another meeting and adjourned the committee at 2:17 p.m.