Legislature(1995 - 1996)
05/01/1996 11:13 AM FIN
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SENATE BILL NO. 191 An Act relating to election campaigns, election campaign financing, the oversight and regulation of election campaigns by the Alaska Public Offices Commission, the activities of lobbyists that relate to election campaigns, and the definitions of offenses of campaign misconduct; and providing for an effective date. Co-chairman Halford directed that SB 191 be brought on for discussion. SENATOR TIM KELLY came before committee in support of the bill. He explained that utilizing CSSB 191 (Jud) as the base, work draft CSSB 191 (9-LS1260\H, Chenoweth, 4/30/96) attempts to strike an agreement on key provisions and clean up and conform initiative provisions to statutory language. Senator Kelly directed attention to correspondence from the chairman of Campaign Finance Reform--Now! The group collected over 33,000 signatures for placement of a campaign finance reform initiative on the November ballot. The correspondence indicates that version "H" is an acceptable approach which addresses the goals of the initiative. Senator Kelly highlighted the following areas: 1. Initiative provisions prohibit non-resident campaign contributions. The work draft CSSB 191 allows limited non-resident campaign contributions. 2. The initiative prohibits personal use, office use, and most other uses of campaign funds. The draft permits some transfer of campaign funds to office use. 3. The initiative prohibits all carryforwards of campaign funds. The draft allows some carryforward. The Senator referenced need for the legislation to meet a standard deeming it "substantially the same" as the initiative and noted strict adherence to the following important provisions that represent the spirit of the initiative: 1. Lobbyists are prohibited from making campaign contributions outside their districts. (Senator Kelly acknowledged that this issue is likely to end up in court.) 2. Candidate-groups-to-candidate-groups transfer of campaign funds are prohibited. 3. Corporations, companies, partnerships, unions and the like are prohibited from making contributions. The proposed draft is an attempt to maintain the essence of campaign finance reform and is substantially similar to the initiative. Senator Kelly acknowledged that it does not resolve all the constitutional questions that have been raised. Provisions of either the initiative or the proposed bill are likely to be taken to court, regardless of which passes. It will take several years for campaign reform to settle out in the court system. Co-chairman Halford asked if the chairman of Campaign Finance Reform--Now! would encourage the governor to sign the proposed draft should it pass the legislature. MIKE FRANK, Chairman, Campaign Reform--Now!, responded affirmatively via teleconference from Anchorage. The Co- chairman then asked if the proposed bill is substantially similar to the goals of the initiative. He further asked if belief that it is would be communicated to the Lt. Governor. Mr. Frank said he could not speak for all petitioners. He voiced his belief that lawyers could make reasonable arguments on "both sides of the bill" because the state of the law is undeveloped. The few pertinent court decisions are 20 years old, and the main decision was 3 to 2. Of greater importance is the time and effort that has gone into the draft. That has significant advantages. Mr. Frank said he was "very supportive" of version "H" and advised that if it is signed into law, he would not become involved in "any revolution to keep the initiative on the ballot." He acknowledged that he could not guarantee there would not be objections. Mr. Frank remarked that while certain provisions of the bill diminish those in the initiative, he understands why the changes were made and that they were made in good faith. They do not do such violence to the initiative that it would serve the long-term interest of the campaign reform group to raise a challenge, if passed. In response to a further question from Co-chairman Halford, Mr. Frank advised that reasonable arguments could be made that it is substantially similar. The political advantages of passage of law are important to a long-term solution accepted by the legislature. REPRESENTATIVE FINKELSTEIN next came before committee. Co- chairman Halford asked if the Representative would encourage both the Governor and Lt. Governor to act on the bill if it was passed. Representative Finkelstein said he would vote for the bill and encourage signature by the Governor. He said he could not determine whether the bill would meet the legal requirement of being "substantially the same" as initiative provisions. Representative Finkelstein voiced his belief that the bill would be good for the state, good public policy, and that it reflects the general goals of the initiative. Co-chairman Halford expressed unwillingness to replace the initiative with the proposed legislation unless the leadership of the 30,000 petitioners is in accord with legislative action. Representative Finkelstein reiterated support for the current draft. Senator Rieger referenced language at Page 20, line 8, and inquired concerning the effect of use of "shall" rather than "may" in discretion relating to penalties associated with a complaint. JACK CHENOWETH, Legislative Counsel, Legal Services, Legislative Affairs Agency, noted the requirement that the commission "shall" assess civil penalties. In subsection (e), commencing at line 17, the commission is given the opportunity to suspend or set aside penalties if it finds the violation was inadvertent, quickly corrected, had no adverse impact, and was not repeated or part of a series or pattern of violations. There is thus a presumption the penalty will be levied, with the exception of conditions cited in subsection (e). Further discussion followed concerning the consequences of changing "shall" to "may." Mr. Chenoweth explained that subsection (b) would become discretionary, and there would be no need for subsection (e). He noted that, as presently drafted, provisions are consistent with the initiative and a bit more structured in directions to the commission regarding how matters will be handled. Representative Finkelstein noted a different standard in the initiative. It contains both a minimum and a maximum. Use of "shall" makes a difference in the initiative. In the bill it makes no difference because all penalties are maximums. There are no minimums. Removal of minimums gives the commission and the court discretion to "go to zero" even when the conditions of (e) are not met. Senator Rieger next questioned language at Page 9, line 24. Representative Finkelstein noted that the initiative contains a $25 cap for cash donations. Senate State Affairs Committee returned the total to existing law ($100) with the concurrence of the sponsors. Senator Randy Phillips inquired concerning the rationale behind the $25 cap. Representative Finkelstein said that testimony from the commission and members of the legislature indicated that current law does not pose a significant problem. Campaigns in rural areas would be negatively impacted by the $25 maximum. The initiative committee concurred in the return to $100 as the maximum. The original intent was to avoid contributions that cannot be tracked. Senator Rieger questioned language within Section 14, Pages 13 and 14. Representative Finkelstein explained that it stems from a request from the Alaska Public Offices Commission. It recognizes a court decision that allows individuals to "do essentially anonymous, no disclaimer, kinds of things for relatively small expenditures in expressing their view through signs and handouts." Without the language, existing "paid for by" standards in Alaska could be challenged and struck down. Senator Rieger voiced his understanding that provisions relate more to the disclaimer than the amount of money spent. Representative Finkelstein concurred. Senator Kelly advised that in developing the bill, several APOC recommendations were adopted. BROOKE MILES, Juneau Branch Administrator, Alaska Public Offices Commission, came before committee and voiced support for version "H." She then explained that the $98.7 fiscal note provides for "some additional provisions." The new investigator would handle complex civil penalties, inquiries from the public, and the complaint caseload. The position would also produce a training program concerning new rules. The administrative clerk would assist in paper processing and provide support functions for the investigator. A regulation specialist would work for two years, only, to write regulations to implement the new rules. In additional to the positions, the fiscal note contains funding for travel for training so that new and incumbent candidates are knowledgeable of rule changes. Co-chairman Halford referenced a proposed amendment. Mr. Chenoweth explained that it would fit within Section 2 language which amends existing law prohibiting use of charitable gaming proceeds to support candidates for public office, a political party, or an organization affiliated with a political party. In drafting the present version, Mr. Chenoweth said he neglected to make reference to AS 15.60 which defines "political group." The amendment extends the definition to bar campaign contributions to "political groups" as defined in the election code. These are small associations and entities that did not qualify at the 3 percent threshold level in the last gubernatorial election. Senator Kelly said the language was brought to light by Senate President Pearce. Mr. Frank advised, via teleconference, that the initiative did not contain provisions relating to the use of charitable gaming proceeds. He voiced his belief that those supporting the initiative would have no problems with the more restrictive language in the proposed amendment. It does not appear to impact initiative provisions relating to group contributions. Representative Finkelstein voiced support for the technical amendment. Senator Randy Phillips MOVED for adoption of CSSB 191 (Fin) (version "H") as the mark-up document. No objection having been raised, CSSB 191 (Fin) was ADOPTED. Senator Phillips then MOVED for adoption of Amendment No. 1. No objection having been raised, Amendment No. 1 was ADOPTED. Senator Phillips next MOVED for passage of CSSB 191 (Fin) with individual recommendations. No objection having been raised, CSSB 191 (Fin) was REPORTED OUT of committee with a $98.7 fiscal note from the Dept. of Administration (APOC), a $47.5 note from the Dept. of Law, and zero notes from the Dept. of Community and Regional Affairs, Governor's Office (Elections), and Legislative Affairs Agency. Co-chairman Frank and Senators Donley, Phillips, Rieger, and Sharp signed the committee report with a "do pass" recommendation. Co-chairman Halford signed "do pass unless amended." Senator Zharoff signed "no recommendation."