Legislature(1999 - 2000)
05/14/1999 02:48 PM JUD
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HB 225-CAMPAIGN FINANCE AND LEGISLATIVE ETHICS PETER TORKELSON, legislative aide to Representative John Cowdery, prime sponsor of HB 225, made the following comments. The House Judiciary Committee version, CSHB 225(JUD), addresses two issues. First, it resolves a technical error made in SB 105 last year. The Legislature foresaw legal challenges to the original ethics law and wisely enacted Session Law 1996, Section 12, Chapter 48, to self- execute upon such time as the court may strike down portions of the original ethics law. Recently the court did strike down a portion of the ethics law. Chapter 46 is set to become law when the court decision becomes final. Last year the Legislature passed SB 105 but inadvertently neglected to amend Chapter 46, so when it becomes law in the next few weeks, it will repeal the actions made in SB 105. HB 225 amends Chapter 46 to allow the actions in SB 105 to take effect. Second, HB 225 clarifies and codifies portions of the ethics law that currently exist in ethics rulings, for example, use of photographs and greeting cards. Number 394 SENATOR DONLEY moved to adopt version M, dated 5/14/99, as the proposed Senate Judiciary Committee substitute. SENATOR ELLIS objected and noted he would voice his specific objections as version M is discussed. The motion to adopt version M as the proposed Senate Judiciary Committee substitute carried with Senators Halford, Donley, and Taylor voting "yea," and Senator Ellis voting "nay." CHRIS NELSON, legislative aide to Senator Tim Kelly, stated two years ago the Legislature passed a comprehensive ethics act that was substantially similar to the initiative passed by the people. That law has been challenged in court; parts of it have been upheld, parts of it have not. The Legislature wants to encourage people to run for office and to be involved in political activities, but that process must avoid the appearance of corruption. The contents of the proposed committee substitute are not an attempt to overturn the current law, nor are they a major revision of the law; the contents are a series of items that respond to specific problem areas identified after having gone through a complete campaign cycle. These adjustments can be made to improve the law to encourage more individuals to participate in the political process and to provide a system that encourages public confidence. MR. NELSON gave the following sectional analysis of version M. New language was added to Section 4 that reads, "More than one group may be registered by a candidate to support that candidate; however, multiple groups controlled by a single candidate shall be treated as a single group for the purposes of the contribution limit in AS 15.13.070(b)(1)." This language allows an individual the freedom to choose how many and which groups become active in his or her campaign, but not for the purpose of collecting contributions over the limit amount that was enacted and upheld by the court. Section 5 increases the campaign contribution limit of $1000 per year to $2000 per year. One problem that has surfaced is that while limits have been placed on contributions to campaigns, corresponding limits were not placed on campaign costs. Candidates and political activities are affected by the marketplace; campaign costs are fixed by market factors and cannot be limited. Providing the opportunity to spend more is a response to market conditions, particularly when one considers the change to Section 5, which allows campaign funds to be used for publicizing and reporting the activities of an organized group as defined in the statute cited. Essentially, this provision pertains to groups formed within the Legislature, such as the Anchorage Caucus. Those groups do not receive appropriations but travel and hold meetings to seek constituent input and to report to constituents. When the Anchorage Caucus last held a public meeting, funds to advertise came from members' campaign funds. CHAIRMAN TAYLOR questioned whether he could use his campaign funds to purchase an airline ticket to attend a function sponsored by a political party or a subordinate unit of a political party. He also questioned how this provision would apply to the Governor's use of the State Troopers' aircraft to travel to Kodiak to attend a statewide gubernatorial debate and to hold two fundraisers. He asked if the Governor and Lt. Governor will be limited to $2000 each, rather than the $80,000 of state funds they spent on their campaign. MR. NELSON claimed no expertise in that area. Number 497 SENATOR DONLEY thought Chairman Taylor's concern was legitimate but not within the scope of HB 225. MR. NELSON said legislation that deals specifically with the Governor and Lt. Governor who have access to those resources would be unique; candidates for other offices do not have that kind of access. CHAIRMAN TAYLOR stated Section 5 only restricts people who are not multimillionaires or incumbent governors. MR. NELSON maintained Section 5 actually broadens a candidate's ability to use campaign funds. The statute, however, does not address other modes of transportation. CHAIRMAN TAYLOR said he does not believe he could accept an invitation to fly in a corporate aircraft to attend a function because the flight would be considered a corporate contribution for the value of the transportation. He asked if HB 225 applies to gubernatorial candidates as well as House and Senate candidates. MR. NELSON stated it does apply to gubernatorial candidates but indicated that the example Chairman Taylor cited, of Governor Knowles using state transportation to attend a political function, would be covered under other ethics areas. HB 225 assumes that candidates will be using commercial carriers and paying for their travel. HB 225 enables them to do so in a more realistic way. CHAIRMAN TAYLOR questioned whether any sections of HB 225 address the Governor's use of state transportation as he was sure a complete revision of the ethics law would not be drafted that allowed such a gross abuse of state assets to continue. MR. NELSON said perhaps an amendment could be offered that would prohibit officeholders from using state funds to travel to political party activities. CHAIRMAN TAYLOR said that prohibition is in law but it is not enforced. Number 534 SENATOR ELLIS asked if the bill would allow members of the Anchorage Caucus to purchase display advertising and promote a meeting in Anchorage with campaign funds. He questioned why we would want to allow that when government funds are an appropriate expenditure for that sort of official government function. He expressed concern about mixing political and government functions too closely. MR. NELSON asked Senator Ellis why he believes using campaign funds would be inappropriate. SENATOR ELLIS said it might appear that members of the Anchorage Caucus were using campaign funds to publicize a meeting for the name identification in the state's largest newspaper and for other political benefits that accrue from holding those meetings. He believes using campaign funds to advertise such meetings mixes partisan campaign considerations with a government function. SENATOR DONLEY maintained that would be similar to the Governor's and Lt. Governor's use of state funds to pay for advertisements inviting the public to talk to them during open door sessions, which he did not find particularly offensive. He noted that legislators do not have that sort of slush fund available, so the provision in HB 225 provides groups of legislators with an alternative method of financing meetings. SENATOR ELLIS argued that legislators are given a $6,000 office account and the Legislature has a multi-million dollar budget, so they do have access to funds to use for Anchorage Caucus meetings. To pool campaign funds together to pay for advertising for Anchorage Caucus meetings mixes the political and governmental arenas together and could increase cynicism on the part of the public. SENATOR DONLEY thought the public would appreciate that legislators are not using public dollars. MR. NELSON continued with the sectional analysis. Section 6 increases the time limit for collecting campaign contributions to run for statewide office to accommodate the increasing costs of campaigning in such a large state. Section 7 adds language that allows corporations, companies, partnerships, firms, associations, organizations, business trusts or sureties, labor unions, or publicly funded entities to sponsor a political party event within Alaska by paying for advertising, food, hall rentals, and other expenses associated with the events. The costs of political party events have traditionally been offset by groups or organizations that support the goals of a particular party, but not to influence a specific election. TAPE 99-34, SIDE B MR. NELSON explained the new language in Section 7 does not open the door for corporate contributions to specific candidates. It does support healthy and active political parties because they make a positive contribution to the political process. By offsetting the costs of party events, more individuals can afford to attend. He noted the cost of attending a state convention has increased dramatically as of result of the new ethics law, an unforeseen and unintended consequence. Number 574 CHAIRMAN TAYLOR asked whether he would be violating the law if he made the maximum contribution allowable to the Democratic Party and then attended a Democratic Party banquet which cost $50 per plate. MR. NELSON said his understanding is he would not because Chairman Taylor's limit to the party is separate from the contribution to the campaign. CHAIRMAN TAYLOR clarified he was referring to attending the party's convention. He explained that every time a women's organization held a monthly meeting in which lunch was available as a fundraiser for $10, the women had to fill out a contribution form if they had contributed the maximum amount. He noted people who want to be politically active cannot contribute the maximum amount otherwise they will be guilty of making additional contributions when buying a hot dog at a convention and subject to criminal penalties. MR. NELSON said he believes the criminal penalties were removed. CHAIRMAN TAYLOR said the bill contains steep civil penalties. MR. NELSON said, as a practical matter, there are not many individuals in Alaska who contribute the maximum to a political party. He suggested the parties give maximum donors a free ticket to any party function. CHAIRMAN TAYLOR expressed concern that these provisions spin out to a point where they affect every political activity, such as putting a poster in a store window. MR. NELSON agreed, and said the store window scenario was a far fetched interpretation that had a chilling effect on free speech and free association in political activities. He said Section 7 differs, however, in that it is designed to look at party activities and to allow groups who are prohibited from a direct advocacy role in a campaign to support the building of vital, active and productive political parties. He said his personal opinion is that current law goes way too far in trying to restrict free association and free speech, but without trying to change the entire thrust of that law, major portions of which have been upheld by the court, HB 225 is a vehicle to solve individual problems within the existing law. MR. NELSON explained Section 10 increases to $2,000 the amount candidates can use from campaign contributions to pay for various kinds of activities. Section 10 also pertains to meetings or activities of organized groups of legislators as defined by statute, such as the Bush or Anchorage Caucus. It allows legislators to use campaign funds to defer the costs of participating in those meetings. MR. NELSON stated a new provision added to Section 11 allows candidates to use unused campaign contributions to pay for thank you advertisements. Section 11 also contains a provision that repeals portions of the restrictions on transferring unused campaign contributions into future election campaigns. CHAIRMAN TAYLOR asked what amount a candidate can transfer. MR. NELSON explained Section 13 establishes future election accounts. Number 484 SENATOR DONLEY noted Section 13 changes the structure of the current carryovers from the particular seat a person ran for to what seat they plan to run for. Under existing law, a gubernatorial candidate can carryover $50,000 for any future campaign, while a candidate for a House seat can only carryover $5,000, even though they both may run for the same seat next time. He thought those differing limits violate equal protection rights. To level the playing field, the new section places a limit on the amount of carryover allowed based on the seat the candidate plans to run for. MR. NELSON said Section 12 increases the limits on carry-over property, such as computers used during a campaign, based on costs and market factors. Subsection 1 is self-explanatory. Subsections 2, 3, and 4, address specific concerns raised and allow a candidate to retain campaign photographs, seasonal greeting cards purchased with campaign funds, and campaign signs prepared for a prior election that have no monetary value. MR. NELSON explained Section 13 addresses public office expense accounts. SENATOR ELLIS questioned what the term, "public office expense term account reserve" refers to on page 10, line 12. SENATOR DONLEY said that term is in existing law and refers to the account from which legislators make deposits to their public office expense accounts. SENATOR ELLIS asked if this proposal changes the amount. SENATOR DONLEY clarified this proposal parallels existing procedure in current law; it increases the amount for Senate district candidates to $10,000, and for House district candidates to $8,000. MR. NELSON explained that voluntary accounting and legal services were removed from the definition of "contribution" in Section 15. Under existing law, services provided by an accountant or another person to prepare reports and statements are not considered contributions. Section 15 (iv) exempts services provided by legal professionals to ensure that candidates, parties, and campaigns are able to fully comply with the law by availing themselves of the best legal counsel. A person who voluntarily serves as legal counsel to the Republican Party can only offer services worth $5,000 under existing law. MR. NELSON maintained that allowing candidates and parties to have continuous legal advice serves a good public purpose. Subsection (iv) also allows the accountant or attorney to volunteer time on his/her own behalf, despite the entity under which that individual conducts business. CHAIRMAN TAYLOR asked if that provision applies to parties only. MR. NELSON clarified it applies to a candidate, group, or political party. CHAIRMAN TAYLOR said a law school classmate of his now practices for Boeing in Seattle. He also passed the Alaska Bar Exam. He asked whether his friend could only contribute $5000 in services toward Chairman Taylor's defense under current law if John Lindauer filed a lawsuit against him. MR. NELSON said serious questions have been raised about how much time an individual can volunteer. CHAIRMAN TAYLOR questioned whether that same logic was applied to the last gubernatorial campaign when there was significant involvement by a Chicago attorney who assisted a candidate. He asked if those legal services were listed as a campaign contribution or a cost. CHAIRMAN TAYLOR also questioned whether the current law is applied to all candidates. MR. NELSON said the enforcement of statutes is the job of the Attorney General. CHAIRMAN TAYLOR said he was asking whether the current law was applied to those circumstances that Mr. Nelson indicated were a problem and are the reason for amending the law. CHAIRMAN TAYLOR stated," Obviously it's not a problem if it's okay to make that kind of a monetary contribution to your own campaign if you're wealthy, to hire whatever attorney you want in-state, out-of-state, have two or three of them. That's not a problem. It's only a problem if some attorney in-state wants to volunteer his time to the Republican Party. MR. NELSON said that is why Section 15 is being amended. He explained the last thing added to Section 15, in response to a question raised, is the removal from the definition of "contributions" of the value to each candidate of mass mailings by a political party, describing the party's slate of candidates, which may include photographs and biographies of the party's candidates. CHAIRMAN TAYLOR asked if the mailing must include everyone on the slate before it so qualifies. MR. NELSON thought party rules would determine that. He noted one prominent Alaska political figure refused to sign a letter on a slate because it included a certain candidate. The decision was made to remove the candidate from that particular mailing. SENATOR DONLEY suggested removing the words "each of" on line 11, page 12, to address Chairman Taylor's concern. CHAIRMAN TAYLOR thought the removal of those words would have the same effect. He noted a party might want to target a mailing at a particular region and not contain all candidates. SENATOR DONLEY said he thought a basic party function is to let people know who its candidates are. MR. NELSON stated Section 16 addresses questions raised about what an office holder or staff member can do. SENATOR DONLEY interjected that Section 16 is identical to the bill that came from the House and that the committee has had this language before it for about three weeks and has reviewed it. SENATOR DONLEY also noted Section 17 clarifies, at the request of APOC, that a particular caucus, such as the Children's Caucus, could not be related to the individual's election campaign. CHAIRMAN TAYLOR asked if an individual could receive a gift from the Children's Caucus. SENATOR DONLEY said the Children's Caucus could receive a gift to cover the cost of meetings and other activities within the State of Alaska. CHAIRMAN TAYLOR asked if that could benefit legislators in some way. Number 290 SENATOR DONLEY said it would help them hold public meetings in locations and it would allow the public to participate in the public policy decision making process. CHAIRMAN TAYLOR asked if this provision could apply to the NCSL, or a situation in which legislators want to get together and a corporate sponsor may want to make gifts so that the event could occur. SENATOR DONLEY said an organized group of legislators for caucuses is defined in existing statute as, "other than the majority caucus, minority caucus,...". MR. NELSON concluded by saying the discussions about how legislators stimulate political participation and activities in the state are necessary. The initiative process, existing law, and court decisions have provided the framework for the campaign finance reform laws that people want. He said he personally finds it troublesome and too restrictive but the framework has been put in place. He thought this legislation is a good package for the committee's consideration. CHAIRMAN TAYLOR proposed an amendment (Amendment 1) to page 4, lines 21 - 25 to read as follows. Page 4, lines 21-25: Delete all material and insert: "(e) A campaign expenditure for goods or services made by the candidate from personal funds or by cash, personal check, or personal credit card and reimbursed to the candidate by the campaign before the end of the reporting period for the report due February 15 under AS 15.13. 110(a) is not a loan or contribution for purposes of this section and shall be reported to the commission as a campaign expenditure." CHAIRMAN TAYLOR explained the amendment clarifies what has been a confusing section within the law, Section 8, which said that if one was to make an expenditure toward his/her own campaign out of personal cash, check, credit card, or personal funds, that amount would have to be reimbursed back to the donor within the reporting period in which the expenditure was made. He said a candidate would not be making that kind of expenditure in the last few days of a campaign if he/she had the money from another source, so to have to pay him/herself back in a few days is silly. He said this will not affect the rules governing personal contributions. CHAIRMAN TAYLOR moved to adopt Amendment 1. There being no objection, Amendment 1 was adopted. CHAIRMAN TAYLOR announced that Senator Hoffman proposed an amendment (Amendment 2). He explained that Senator Hoffman employs a Representative's son during the legislative session. Because of the existing nepotism law, he cannot hire this same employee during the interim. Amendment 2 amends the nepotism provision so that a relative of a member from the other house could be employed during the interim. Amendment 2 reads as follows. Page 5, following line 20: Insert a new bill section to read: "*Sec. 4. AS 24.60.090 is repealed and reenacted to read: Sec. 24.60.090. Nepotism. (a) An individual who is related to a member of the legislature may not be employed for compensation (1) during the legislative session of the house in which the legislator is a member; (2) by an agency of the legislature established under AS 24.20; or (3) in either house during the interim between sessions. (b) An individual who is related to a member of the legislature may not be employed by the committee, whether for compensation or not. (c) An individual who is related to a legislative employee may not be employed in a position over which the employee has supervisory authority. (d) Notwithstanding (a)(3) of this section, an individual who is related to a member of the legislature may be employed in the other house of the legislature during the interim between sessions if, while the individual was disqualified from employment in either house of the legislature during the interim under this section, the individual worked for at least 100 days in each of four regular legislative sessions. (e) In this section, (1) "an individual who is related to" means a member of the legislator's or legislative employee's immediate family or a person who is a legislator's or legislative employee's spousal equivalent living together in a conjugal relationship not a legal marriage with the legislator or legislative employee; and (2) "interim between sessions" means the period beginning on the eighth day after the legislature adjourns from a regular or special session and ending eight days before the date that the legislature next convenes in regular session under AS 24.05.090 or in special session under AS 24.05.100; (3) "other house of the legislature" means the house in which the individual's relation is not a member. Renumber the following bill sections accordingly. Page 5, line 21: Delete "sec. 5" Insert "sec.6" SENATOR DONLEY questioned the logic of the existing restriction. SENATOR HALFORD explained the reason for the limit is that family members of legislators are often stuck in Juneau so they were allowed to work for the other body while in session, despite the general prohibition against hiring relatives. CHAIRMAN TAYLOR moved the adoption of Amendment 2. There being no objection, the motion carried. CHAIRMAN TAYLOR offered Amendment 3 (M.1) which reads as follows. Page 5, line 12, following "may": Insert "(1) donate money, goods, or services to a political party for the purpose of party administration, overhead, party-building, and other uses that are not for the purpose of influencing the nomination or election of a candidate and, under AS 15.13.010(b), that are not for the purpose of influencing a ballot proposition or question; and (2)" Page 5, line 14: Delete "(1)" Insert "(A)" Page 5, line 17: Delete "(2)" Insert "(B) [(2)]" Page 5, line 20: Delete "(3)" Insert "(C) [(3)]" Page 5, line 22: Delete "(4)" Insert "(D)" Number 172 SENATOR ELLIS objected because he believes Amendment 3 conflicts with the spirit of the citizens' initiative. Allowing donations to political parties for overhead will free up money parties can then use for candidate contributions. SENATOR DONLEY stated different versions of HB 225 have been before the committee for three weeks, and those versions have been consistent with the law that passed. Amendment 3 is a major expansion of what can be directly donated to political parties, and he is reluctant to make that change. SENATOR HALFORD noted if the committee is looking at getting this bill passed at this late date, it is less likely to happen with controversial provisions. A roll call vote was taken. The motion to adopt Amendment 3 failed with Senators Halford and Taylor voting "yea," and Senators Donley and Ellis voting "nay." CHAIRMAN TAYLOR offered Amendment 4 which reads as follows. Page 11, line 26, following "behalf of a": Insert "political party." Number 117 CHIP WAGONER, Republican National Committee Chairman, stated he is the promoter of the packet of amendments before the committee. He noted the adoption of the amendments would make APOC's and the parties' lives a lot simpler. He explained that parties right now, under the campaign finance law, are defined as groups, but they are also separately defined as political parties. The Republican Party does not have a problem with what the voters did in terms of wanting to regulate attempts to influence an election. What the sponsors of the initiative did not understand is that, unlike a group, whose sole purpose may be to influence an election by defeating a candidate or a bond issue, parties have other purposes. The purpose of the series of amendments is to maintain the existing prohibitions and limitations on parties with regard to their attempts to influence anything, but to give the parties a little bit of leeway in terms of those things that have nothing to do with trying to influence an election, i.e. a state convention. CHAIRMAN TAYLOR noted he thought Amendment 4 was taken care of in the committee substitute in the provision that deals with volunteer attorneys and others. MR. WAGONER suggested inserting the words "political party" on lines 1 and 2 in that section of the bill because although APOC includes political parties in that provision, it would prefer to have it specifically spelled out in statute. SENATOR DONLEY asked for an opinion on Amendment 4 from an APOC representative. BROOKE MILES, APOC, stated APOC has no problem with including the term "political party" on line 26. CHAIRMAN TAYLOR clarified the second part of Amendment 4 is included in the proposed committee substitute, therefore Amendment 4 would only add the term "political party" to page 11, line 26. There being no objection, Amendment 4 was adopted. MR. WAGONER informed committee members he was working off of a different version of the proposed committee substitute. He noted Amendment 5 is similar to Amendment 3 which previously failed. He explained the purpose of the amendment is to allow an individual to donate money, goods or services to a political party for the purpose of party administration overhead, party building, and other uses not associated with the nomination or election of a candidate. Amendment 5 would directly take care of the problem raised by Chairman Taylor earlier in which a person who made the maximum contribution to a political party could not pay to attend a convention. Mr. Wagoner said he does not believe APOC is opposed to Amendment 5. TAPE 99-35, SIDE A BROOKE MILES said that APOC has been sensitive to its interaction with the political parties since the campaign finance reform law was enacted. For example, when issues with the most recent Republican Party convention arose in which it could not use its customary business support for that function, APOC wished that the law could be interpreted to allow that. Amendment 5 would set up a different system for the parties; they would have both an administrative and political branch. In essence, that system would free up a lot of money that could be used for candidate campaigns. The Republican National Party uses this system and has segregated funds. CHAIRMAN TAYLOR verified the Republican National Party keeps two sets of books; one for the administrative arm, and one for the political arm. SENATOR ELLIS maintained that would not be a good model for Alaska given the large number of problems that have occurred on the national level. MR. WAGONER thought it would make the parties' efforts to comply with the campaign finance laws much easier and it would make the efforts of APOC staff to enforce those laws much easier as well. SENATOR ELLIS noted his objection to adopting Amendment 5 was based on the same reason he opposed Amendment 3. The motion to adopt Amendment 5 failed with Senators Donley, Halford, and Ellis voting "nay," and Chairman Taylor voting "yea." Number 060 MR. WAGONER explained Amendment 6 eliminates part of the definition of the word "expenditure" that relates to anything of value incurred or made for the purpose of use by a political party. The existing law makes every single dime spent by a political party subject to APOC regulations. If a party spends money trying to influence an election, or the outcome of a ballot proposition, that should be regulated and the public should know about it. However, if a party pays a bookkeeper to pay electric bills, that expenditure should not have to be reported to APOC. Amendment 6 eliminates such expenditures from the definition. Amendment 6 reads as follows. Page 12, following line 11: Insert a new bill section to read: "Sec.16 AS 15.13.400(4) is amended to read: (4) "expenditure" (A) means a purchase or a transfer of money or anything of value, or promise or agreement to purchase or transfer money or anything of value, incurred or made for the purpose of (i) influencing the nomination or election of a candidate or of any individual who files for nomination at a later date and becomes a candidate; (ii) [USE BY A POLITICAL PARTY; (iii)] the payment by a person other than a candidate or political party of compensation for the personal services of another person that are rendered to a candidate or political party; or (iii) [(iv)] influencing the outcome of a ballot proposition or question; (B) does not include a candidate's filing fee or the cost of preparing reports and statements required by this chapter;" Renumber the following bill sections accordingly. Page 15, line 29: Delete "sec. 21" Insert "sec. 22" Page 15, line 31: Delete "sec. 20" Insert "sec. 21" CHAIRMAN TAYLOR moved the adoption of Amendment 6. SENATOR ELLIS objected and stated he is aware that it is difficult for all political parties to adjust to the realities of the new law, however, he sees no reason to limit the amount of public information available because all expenditures are interconnected. The motion to adopt Amendment 6 failed with Senators Halford and Taylor voting "yea," and Senators Donley and Ellis voting "nay." Number 100 CHAIRMAN TAYLOR offered Amendment 7 which reads as follows. Page 12, following line 10: Insert a new bill section to read: "*Sec.16 AS 15.13.400 is amended by adding a new paragraph to read: (12) "influence" or "influencing" means the use of explicit words of advocacy for (A) the nomination, election, or defeat of a clearly identified candidate; or (B) the adoption or defeat of a clearly identified ballot proposition or question." Renumber the following bill sections accordingly. Page 15, line 29: Delete "sec.21" Insert "sec. 22" Page 15, line 31: Delete "sec. 20" Insert "sec. 21" MR. WAGONER explained the key word of the entire campaign finance law is the word "influence." That word is not currently defined in Alaska Statute, it is however defined in U.S. Supreme Court case law, i.e., Buckley v. Vallejo. The definition in Amendment 7 meets the express advocacy test in Buckley v. Vallejo and provides more of a bright line test between issue advocacy versus trying to influence or defeat a candidate. MS. MILES agreed with Mr. Wagoner in that this definition is the term of art in the United States Supreme Court Case, Buckley v. Vallejo. When APOC deliberates a case involving activities conducted to influence, it uses the definition provided in that case. SENATOR ELLIS objected to the adoption of Amendment 7 and stated it appears the amendment is intended to open a door that would allow a party to spend money in an election to endorse a candidate without using words of advocacy. MS. MILES noted if political parties are required to continue disclosing expenditures to APOC, it does not make much sense to open this area. The motion to adopt Amendment 7 failed with Senators Donley, Ellis, and Halford voting "nay," and Chairman Taylor voting "yea." Number 188 CHAIRMAN TAYLOR moved to delete the words "of each" from page 12, line 11 (Amendment 8), which relates to mass mailings by political parties and would not require all party candidates to be included. SENATOR ELLIS asked if one candidate is omitted from the slate, would the fact that the others are included be considered a party contribution. CHAIRMAN TAYLOR clarified his intent is to prevent political parties from having to include all candidates in mass mailings targeted at specific zip codes. SENATOR ELLIS said he understands Chairman Taylor's point and does not object to it, however he does not understand why the valuable exposure provided to certain candidates is not counted against the party contribution limit. SENATOR DONLEY pointed out political parties should be able to tell people who their candidates are. SENATOR ELLIS agreed but thought that service should count as a contribution. SENATOR DONLEY indicated it might be very difficult to proportion out the percentage of each candidate's benefit from each mailing when the pamphlet may contain a combination of candidates from different districts. He maintained it is unnecessary and that by putting a financial limit on it, mass mailings will become complex and difficult to administer. CHAIRMAN TAYLOR added it would come down to measuring the size of the print on the page, the value of the placement on the page, the number of people on each page, etcetera. MR. NELSON informed committee members he has worked on several campaigns, and this issue is a can of worms. The typical slate contains both state and federal candidates, in which case the federal law applies. Three years ago, he divided the slate mailer with all state candidates on it three mailers, because of the number of pictures that fit on a page. He agreed with Senator Donley that this activity should be considered a basic party function, and that constraining that activity will have a chilling effect on party activities. He did not believe the constraint would serve any good public purpose. The motion to adopt Amendment 8 carried with Senators Halford, Donley and Taylor voting "yea," and Senator Ellis voting "nay." CHAIRMAN TAYLOR offered Amendment 9 as a conceptual amendment. Amendment 9 would add language to Amendment 2, which was adopted, to read: On page 1, line 10, insert (4) as a registered lobbyist or by a registered lobbyist. SENATOR DONLEY cautioned that language is outside of the title of the bill because nepotism falls under legislative ethics and lobbying is a separate issue. CHAIRMAN TAYLOR thought it would fall under the legislative ethics portion of the title because the legislator would need to resign if related to, or married to, a lobbyist. SENATOR ELLIS said Chairman Taylor might want to make sure his conceptual amendment covers subcontracts and other financial arrangements that differ from direct employment. SUSIE BARNETT, Select Committee on Legislative Ethics, noted Section 24.60.070 relates to close economic associations and would also need to be amended. She recounted that last year when the bill was amended, legislators decided not to ban lobbyists, but required disclosure under close economic association. CHAIRMAN TAYLOR said he would include in Amendment 9 modification of the disclosure and close economic association requirements to make those sections consistent with the intent. SENATOR DONLEY objected to the adoption of Amendment 9. The motion to adopt Amendment 9 carried with Senators Ellis, Halford, and Taylor voting "yea," and Senator Donley voting "nay." CHAIRMAN TAYLOR stated he would have a new committee substitute that incorporates today's amendments prepared for the meeting tomorrow. There being no further business to come before the committee, CHAIRMAN TAYLOR adjourned the meeting at 4:45 p.m.