SB 284-CAMPAIGN EXPENDITURES  9:26:38 AM CHAIR MENARD announced the next order of business to come before the committee would be SB 284. SENATOR FRENCH, sponsor of SB 284, read the following sponsor statement: In the wake of the recent U.S. Supreme Court ruling, Citizens United v. Federal Election Commission, the Senate Judiciary Committee has worked to determine the changes to Alaska's elections laws that will be needed. Corporations have been banned from participating in Alaska's elections prior to this ruling. This means many of Alaska's laws regarding disclosure and disclaimers simply do not apply to corporations making independent expenditures to support or oppose specific candidates in elections. Testimony from Legislative Legal Services attorneys and from the Alaska Department of Law indicated that changes would be needed to Alaska's campaign laws, and this bill was subsequently drafted to address the concerns raised by the attorneys and by committee members. Senate Bill 284 amends state election laws to clarify that corporations are covered by all applicable reporting requirements. It expands communication identification requirements to ensure accurate reporting of top contributors, to require the approval of the content by the principal officer of the corporation, and to require statements in each communication that its content has not authorized or approved by the candidate. It also speeds reporting requirements for communications expenditures in the last nine days of the election so that expenditures over $250 must be reported within 24 hours. Recent opinion surveys show broad disapproval by Americans across party lines for the decision reached by the U.S. Supreme Court. In order to retain Alaskan's trust in our system it is vital that legislation be passed this year to ensure that corporations spending money to influence elections are at least required to disclose it in a timely fashion. I urge you to support Senate Bill 284. SENATOR MEYER said the U.S. Supreme Court ruling pertained to corporations and unions. He asked why Senator French only addressed corporations in his sponsor statement. SENATOR FRENCH replied that was inadvertent. SB 284 defaults to a definition of 'person' which under Alaska law encompasses individuals, candidates, groups, non-group entities, corporations and unions. The intent is to bring all players under the same set of laws and rules. 9:30:03 AM CHAIR MENARD asked how other states are reacting to the U.S. Supreme Court ruling. SENATOR FRENCH replied that states are hurrying to adopt new disclosure and disclaimer laws prior to upcoming elections. Alaska's Attorney General (AG) has issued an opinion that largely endorses many requirements that SB 284 puts into place. SB 284 has two main points: disclosure and disclaimer. Disclosure means reporting to the Alaska Public Offices Commission (APOC) what one is taking in and spending. Disclaimer means putting a message on the communication itself saying who paid for it. Under SB 284, the top five contributors to a group that paid for a communication would have to list their contributions. 9:32:17 AM SENATOR MEYER asked if SB 284 would affect all corporations, regardless of size. SENATOR FRENCH replied yes. SENATOR MEYER asked what the disclosure requirements are for the corporations. SENATOR FRENCH replied that on page 3, lines 7-12 require disclosure of the candidate or the title of the ballot proposition being supported or opposed and the name and address of each officer or director, when applicable. On page 3, paragraph 5, beginning on line 14, requires the name, address and principal occupation and employer of an individual contributor. If it is a group, non-group entity or corporation, the name and address of the contributor and the name and address of each officer and director of the contributor is required. 9:34:38 AM SENATOR MEYER asked about the requirement for each officer and director on Page 3, line 11. He provided an example of Carrs Safeway contributing to a campaign to pass school bonds and asked if Carrs Safeway would have to list all directors and officers nationwide or just in Alaska. SENATOR FRENCH replied that Carrs Safeway would have to list the officers and directors of whatever subdivision gave the money. He provided another example using BP. Whichever entity of BP "writes the check", such as BP Alaska, BP National or BP International, must list its directors and officers. SENATOR MEYER asked how SB 284 would apply to unions. SENATOR FRENCH replied that the U.S. Supreme Court decision and SB 284 do not effect contributions to candidates. The Supreme Court decision opened up independent expenditures for and against candidates by corporations and unions. Corporations still cannot give any candidate money but can support or oppose candidates independently on TV, in print or radio. SENATOR MEYER asked if there is a dollar amount. SENATOR FRENCH responded no. SENATOR MEYER asked what the Teamsters, for example, need to disclose if they want to support a candidate. SENATOR FRENCH replied that the Teamsters would have to disclose the name and address of each officer and director of the entity that wrote the check; for example, Teamsters Alaska Local 959. 9:37:46 AM SENATOR MEYER asked Senator French to explain page 3, lines 13- 17, about the aggregate amount not exceeding $100. He asked why all contributions, regardless of amount, aren't required to be disclosed. SENATOR FRENCH replied that the report of contributions must contain the aggregate amount of all contributions made to the person. For all contributions that exceed $100, the report must include the date of the contribution and the amount contributed by each contributor. An individual contributor's name, address, principal occupation and employer must be listed. If a corporation is contributing, the name and address of each officer and director is required. SENATOR MEYER said currently candidates can disclose all contributions. SENATOR FRENCH said candidates have to disclose all the contributions and the name. Some candidates voluntarily add the occupation and employer for all contributions and others wait until the threshold is hit. SENATOR MEYER asked if Senator French thinks SB 284 tracks the current process. SENATOR FRENCH replied yes. SENATOR PASKVAN referred to page 3, paragraph 5, lines 13-17 and asked for confirmation that a legal entity, such as a corporation, would be required to divulge whether the employees of that corporation are contributing or if the president alone is utilizing its general funds. 9:40:56 AM SENATOR FRENCH replied that Senator Paskvan's analysis was correct. SENATOR MEYER referred to Section 11 of SB 284 on page 5, line 23 which says "include a statement from the principal officer approving the communication". He asked what Senator French envisions as far as a statement from the principal officer. SENATOR FRENCH responded that people are familiar with a statement following a TV ad, such as, "I am Senator So-and-so, and I approve this ad." He said the intention of SB 284 is to make certain that voters hear from the principal officer or the person bringing the advertisement forth. SENATOR MEYER asked if a corporation's local presiding officer in Alaska would be at the end of a TV ad or, for example, the president of Conoco Phillips in Houston. SENATOR FRENCH replied with an example: If Exxon Alaska made the ad, Marty Massey would make the statement; if it's Exxon USA or Exxon Global, whoever rules that particular domain would make the statement. The same applies for unions. It helps establish accountability. SENATOR MEYER said he does not disagree but more than likely the money came from Houston, London or Ohio. Corporations are so big that you can get lost in the maze. 9:43:54 AM SENATOR FRENCH said Senator Meyer is anticipating some of the difficulties of the new landscape and SB 284 will not stay its present form for long before more changes will be needed. However, something needs to get on the books. SENATOR MEYER said he feels full disclosure is always best. CHAIR MENARD said she is concerned about the requirement that a board of directors must report all names and asked if officers and secretaries must be named. SENATOR FRENCH replied yes. CHAIR MENARD said doing so could be cumbersome. She asked if the recording criteria for corporations is identical to the statutory requirements for other non-corporate groups. SENATOR FRENCH said the intention is to make them all equal. 9:45:51 AM MARILYN RUSSELL, President, League of Women Voters - Alaska (LWV) said LWV supports SB 284. The goals of a campaign system should be: to ensure the public's right to know, to combat corruption and undue influence, to enable candidates to compete more equitably and to promote citizen participation in the political process. The LWV was disappointed in the recent U.S. Supreme Court decision and polls show that eight in ten Americans oppose the decision to allow corporate political spending. Alaska's campaign laws must be amended, before the upcoming primary and general elections, to require full disclosure of campaign contributions by corporations and labor unions which are currently not covered under existing laws regarding disclosure and disclaimer. Citizens should know who is spending money supporting or opposing candidates and ballot issues. The information should be available with the campaign communication itself. 9:48:06 AM MATT WALLACE, Executive Director, Alaska Public Interest Research Group (AKPIRG) said getting something on the books to mitigate undue spending in upcoming campaigns and elections is critical. AKPIRG is encouraged to see that SB 284 would require the same type of disclosure for independent corporate and union spending that is currently required for campaign contributions to candidates. AKPIRG wants citizens to know who is paying for attack ads. AKPRIG supports decreasing the influence of big money in politics, leveling the playing field, and giving citizens a voice in the political process. AKPIRG is in strong support of SB 284. 9:50:47 AM JOHN PTACIN, Attorney, Department of Law, said his main client is the Alaska Public Offices Commission (APOC). He said Alaska may not prohibit independent expenditures attenuated to political speech outright. That changes the landscape of the law. Currently some disclosure and disclaimer laws do apply to corporations, labor unions and companies attempting to make an independent expenditure in a candidate election. Other laws do not apply because when legislation was passed, the legislature did not contemplate corporations and labor unions making independent expenditures in candidate elections. An AG memorandum, issued about 10 days ago, determined that the true source of funds is an issue for corporations, labor unions and companies making independent expenditures in candidate elections. 9:53:26 AM SENATOR FRENCH asked Mr. Ptacin if anything in SB 284 is inconsistent with the opinion put out by the AG's office. MR. PTACIN replied that he does not find any inconsistencies between SB 284 and the AG's memo. CHAIR MENARD closed public testimony. SENATOR PASKVAN said Senator French should be commended because the change in the legal landscape following the January 2010 U.S. Supreme Court decision leaves potential for inequities in the upcoming election. A legal entity such as a corporation or union should stay out of the political debate if they don't want to disclose or disclaim. Citizens have a right to know and SB 284 should be passed. SENATOR MEYER said he agrees with Senator Paskvan. His only concern is that SB 284 needs some cleanup so that unions or corporations know the rules if they want to participate in the passage of school bonds, for example. 9:56:11 AM SENATOR MEYER moved to report SB 284 from committee with individual recommendations and attached fiscal note(s). There being no objection, the motion carried.