Legislature(2003 - 2004)

04/04/2003 01:38 PM Senate JUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
               SB 89-LOBBYING/ LEGISLATIVE ETHICS                                                                           
CHAIR SEEKINS announced SB 89 to be up for consideration.                                                                       
SENATOR OGAN  motioned to adopt  CSSB 89(JUD), 23LS0855\H  as the                                                               
working document.                                                                                                               
SENATOR ELLIS objected for purposes of discussion.                                                                              
CHAIR  SEEKINS  explained  it  was  an  attempt  to  shorten  the                                                               
definitions to  make them clearer  and differentiate  between two                                                               
different types of lobbyists, A and B.                                                                                          
SENATOR OGAN asked who suggested 40 hours.                                                                                      
CHAIR  SEEKINS  said   it  was  his  suggestion  and   it  was  a                                                               
SENATOR  OGAN   asked  if  there   were  any  meetings   on  this                                                               
legislation outside of the committee  with other folks interested                                                               
in the bill.                                                                                                                    
CHAIR  SEEKINS  replied   yes,  he  met  with   the  entire  APOC                                                               
commission and other people expressed their opinions to him.                                                                    
SENATOR ELLIS  pointed out that  you could conduct  your business                                                               
in  the Baranof  Hotel and  that wouldn't  be considered  "in the                                                               
SENATOR OGAN asserted  that he spent less than four  hours at the                                                               
Baranof this year exclusive of attending some receptions.                                                                       
SENATOR ELLIS  said he  wanted their comments  on the  record and                                                               
withdrew  his objection.  Committee substitute  CSSB 89(JUD)  was                                                               
adopted as the working document.                                                                                                
3:25 p.m.                                                                                                                     
MS.  TAMMY KEMPTON,  Juneau Branch  Administrator, Alaska  Public                                                               
Offices Commission, said she is  also the regulator of lobbyists.                                                               
She said she  would cover a brief history of  the lobbying law in                                                               
Alaska, focusing  on the issue  of employees who lobby  for their                                                               
employers and  how that's been  defined over the years.  She also                                                               
wanted  to  share  research  on  how  other  states  address  the                                                               
definition. She told members:                                                                                                   
     The first  lobbying law  was passed  in 1913  and there                                                                    
     are two types of lobbyist,  but neither type was called                                                                    
     a   lobbyist.  There   were   legislative  counsel   or                                                                    
     legislative  agents  and  both  the  lobbyist  and  the                                                                    
     employer  were required  to register.  That requirement                                                                    
     was expressed  as 'whoever employs  a person to  act as                                                                    
     counsel  or agent  to promote,  advocate or  oppose the                                                                    
     passage  or  defeat by  the  legislature  of any  bill,                                                                    
     resolution  or  legislative  measure or  the  executive                                                                    
     approval or  veto thereof  or to act  in any  manner as                                                                    
     legislative  counsel or  agent in  connection with  any                                                                    
     So it was a  fairly cumbersome explanation. legislation                                                                    
     lobbyists appeared before  committees to make arguments                                                                    
     and  examine witnesses  and they  acted and  advised on                                                                    
     specific  legislation.  Agent lobbyists  were  employed                                                                    
     for  any purpose  in connection  with any  legislation.                                                                    
     The  registration fee  in those  days was  $5 and  that                                                                    
     money went to the District Historical Library Fund.                                                                        
     Public  and  municipal  officials  and  employees  were                                                                    
     exempt in 1913 as were  people invited to appear before                                                                    
     the Legislature or its  committees and those exemptions                                                                    
     are still in effect in the current law.                                                                                    
     Also,  in  1913  was  a   provision  stating  that  the                                                                    
     lobbying law  was not  to be  construed to  prevent any                                                                    
     legislator from discussing  with their constituents the                                                                    
     advisability  of any  legislation.  At  that time,  the                                                                    
     provision was unique  in the United States.  As late as                                                                    
     1960,  it still  didn't  appear in  federal  or in  any                                                                    
     other state's lobbying law.  This provision is retained                                                                    
     in our current law.                                                                                                        
     There  were no  definitions in  1913. Those  didn't get                                                                    
     added until 1976. In 1949,  they amended to qualify the                                                                    
     requirement of  who had to  register as a  lobbyist and                                                                    
     what  they added  was whoever  being a  person being  a                                                                    
     corporation  'engages or  assigned  any person  already                                                                    
     regularly  employed  by  said person,  either  with  or                                                                    
     without additional compensation' and  then they went on                                                                    
     and  talked  about  retaining   somebody  that  was  an                                                                    
     outside person.  That requirement  - that  any employee                                                                    
     who was assigned to lobby  must register as a lobbyist,                                                                    
     continued until the Act was rewritten in 1976.                                                                             
     Also, in '49  they added provisions that  no person can                                                                    
     lobby before  registering and that  compensation cannot                                                                    
     be  dependent  on  passage or  defeat  of  legislation.                                                                    
     Those last two provisions are also still in the law.                                                                       
     In 1976, the entire law  was repealed and rewritten and                                                                    
     it  was   the  1976  law  that   added  the  qualifier,                                                                    
     substantial or  regular, which [is] the  subject of the                                                                    
     bill before us.                                                                                                            
MS. KEMPTON said other states  have a variety of requirements for                                                               
an  employee  whose  job  duties   do  not  specifically  include                                                               
lobbying to  register as  a lobbyist.  In Hawaii,  employees must                                                               
register if  they lobby  in excess  of five hours  in a  month or                                                               
spend more than  $750 lobbying in that month.  In Connecticut, an                                                               
employee doesn't  have to register  if lobbying is limited  to no                                                               
more  than  five hours.  Wisconsin  requires  registration if  an                                                               
employee lobbies for  more than four days in  a six-month period.                                                               
Washington  State  defines  nine different  types  of  lobbyists.                                                               
Employees  are exempt  if they  limit their  lobbying to  no more                                                               
than four  days or  parts thereof  during any  three-month period                                                               
and their expenditures do not exceed $25.                                                                                       
In Oregon,  lobbying activity is defined  to specifically include                                                               
attempting  to obtain  the good  will  of legislative  officials.                                                               
Employees are exempt  if they lobby less than 24  hours and spend                                                               
less  than  $100 during  any  calendar  quarter. In  Arizona  and                                                               
Idaho,  employees have  to  register if  they  receive income  or                                                               
reimbursement  of $250  or  more attributable  to  lobbying in  a                                                               
calendar  quarter.  Idaho,  Vermont   and  Virginia  all  require                                                               
employees  to  register  if  they  receive  or  expend  a  yearly                                                               
aggregate of  $500 in compensation or  expenditures for lobbying.                                                               
Montana  exempts employees  whose  reimbursable  expenses do  not                                                               
exceed $1,000 per year, although  there is current legislation to                                                               
raise that limit to $2,500.                                                                                                     
In  West  Virginia, the  exemption  is  a little  different.  The                                                               
exemption  is  for  employees  who   limit  their  activities  to                                                               
attending  group social  functions  and make  no expenditures  in                                                               
connection with lobbying.                                                                                                       
Kentucky's laws  are very different.  Employees have  to register                                                               
if  they  lobby on  a  substantial  basis. Substantial  basis  is                                                               
defined as  contacts which are  intended to influence  a decision                                                               
that  involve one  or more  disbursements  of state  funds in  an                                                               
amount of at least $5,000 a year.                                                                                               
MS.  KEMPTON related  that prior  to introduction  of SB  89, the                                                               
commission was looking  at increasing the number of  hours in the                                                               
regulatory definition  of substantial  or regular.  They consider                                                               
16 hours  in a 30-day period  to be a reasonable  definition. The                                                               
commission's other  concern is  with the  definition of  (B) that                                                               
says,  "A person  who represents  one's self  as engaging  in the                                                               
influencing  of   legislative  or  administrative  action   as  a                                                               
business  occupation or  profession."   The concern  is with  the                                                               
definition  of  a lobbyist  as  "a  person who  represents  one's                                                               
self." No professional lobbyist  represents himself or herself as                                                               
a lobbyist.                                                                                                                     
CHAIR   SEEKINS   interrupted  to   say   he   thought  she   was                                                               
misinterpreting   that  definition.   Anyone   engaged  in   that                                                               
profession  is  advertising that  he  or  she is  a  professional                                                               
MS. KEMPTON replied that she  understood that, but she was trying                                                               
to  explain   that  most  professional  lobbyists   do  not  call                                                               
themselves lobbyists;  they call themselves consultants  and they                                                               
call their  business consulting. They  do more for  their clients                                                               
than just lobby.                                                                                                                
CHAIR SEEKINS  interrupted to  ask if there  was a  definition in                                                               
regulation for  influencing legislative or  administrative action                                                               
that would clarify that.                                                                                                        
MS. KEMPTON  replied there  is a  definition that  could possibly                                                               
clarify   that.  Because   consultants  do   other  things   like                                                               
monitoring  legislation,  strategizing,  etc.,  they  would  fall                                                               
under "A" unless "B" is also rewritten.                                                                                         
TAPE 03-16, SIDE B                                                                                                            
MR.  JOE MATHIS,  Senior  Operations  Officer, NANA  Corporation,                                                               
supported  SB 89.  He said  he communicates  with legislators  to                                                               
ensure that his  interests and the interests  of Northwest Alaska                                                               
citizens  and businesses  are  protected. He  said  he finds  the                                                               
current APOC requirement  to register as a lobbyist  if you spend                                                               
four  hours  in a  30  day  period  communicating with  a  public                                                               
official to be unusually stringent  and incorrect. In addition to                                                               
the  time  limit,  APOC  chose   to  broadly  interpret  lobbying                                                               
activities  to  include  attending  a  reception  attended  by  a                                                               
He  said that  AS  24.25.171 says  a person  must  register as  a                                                               
lobbyist if  a substantial or  regular portion of  activities for                                                               
which  the person  receives compensation  is for  the purpose  of                                                               
influencing legislative or administrative  actions. He said there                                                               
is  no way  four  hours in  a  30 day  period  could represent  a                                                               
substantial or regular portion of  the activities for which he is                                                               
paid and  he's not  a lobbyist. Many  businesses in  Alaska can't                                                               
afford  to hire  a full-time  lobbyist, and  even if  his company                                                               
could, he said he is often the  best person to tell how an action                                                               
might affect NANA Development Corporation.                                                                                      
MR.  MATHIS said  he  doesn't believe  it  is appropriate  public                                                               
policy to create onerous requirements  that do nothing to protect                                                               
the public's  interest, but  he firmly  believes that  people who                                                               
derive  their  livelihood  from  lobbying  activities  should  be                                                               
registered as lobbyists.  He isn't sure the 80 hours  in SB 89 is                                                               
the right amount  of time and noted that he  also supports HB 106                                                               
on the same issue.                                                                                                              
MR. MATHIS  stated he was going  to testify next as  the owner of                                                               
the Montana  Creek Campground and  a volunteer on the  United Way                                                               
Board, the American Red Cross,  Alaska Support Industry Alliance,                                                               
Arctic  Power   Board,  Ocean  View  Community   Council,  Alaska                                                               
Campground  Owners Association  and  a volunteer  for the  Prince                                                               
William Sound  response team. All  of those activities,  with the                                                               
exception  of   the  Montana  Creek  Campground,   are  volunteer                                                               
activities and take him to Juneau many times a year.                                                                            
CHAIR SEEKINS  called an at-ease  from 2:35  - 2:37 p.m.  He came                                                               
back on  the record and  announced that  APOC said four  hours is                                                               
too restrictive. He  said this kind of  volunteer activity, where                                                               
his company  is paying him as  part of the community  service and                                                               
gets some  benefit, is in  a gray area. Strict  interpretation of                                                               
the  regulations could  count that  time toward  the four  hours,                                                               
which is why they are trying to expand the definition.                                                                          
MR.  DICK  CATTANACH,   Executive  Director,  Associated  General                                                               
Contractors  of Alaska  (AGC), said  one of  the cornerstones  of                                                               
democracy  is  citizen  participation  and each  year  AGC  flies                                                               
members  to Juneau  to meet  with  legislators. It  is a  two-day                                                               
event with a  reception in the evening and  there is face-to-face                                                               
contact with legislators  for 10 - 12 hours. That  would make all                                                               
the people that traveled to Juneau  this year in violation of the                                                               
law. He is certain it is  not the intent to make Alaskan citizens                                                               
into criminals.                                                                                                                 
CHAIR SEEKINS  said they are  currently considering  a definition                                                               
of 40 hours  in any calendar month. He asked  if Mr. Cattanach if                                                               
he thought that was a reasonable number.                                                                                        
MR.  CATTANACH replied  it is  acceptable  90% of  the time,  but                                                               
there might be someone who comes  down from AGC in early February                                                               
and then comes  down again with the Chamber  in mid-February and,                                                               
all  of a  sudden,  they're  bumping up  against  that limit.  He                                                               
thought the  original bill is  aimed at someone who  is promoting                                                               
certain  legislation. He  opined  there may  be  problems with  a                                                               
strict interpretation of 40 hours.                                                                                              
CHAIR   SEEKINS  asked   if  language   that  says   face-to-face                                                               
representation would make it clearer.                                                                                           
MR.  CATTANACH said  that  would  be much  better.  He noted,  "I                                                               
wouldn't have any trouble with the 20 hours at that point."                                                                     
MS.  BROOKE MILES,  Director, Alaska  Public Offices  Commission,                                                               
said she was available to answer questions.                                                                                     
SENATOR ELLIS noted that a  company named Agrium wanted the state                                                               
to contribute $11 million to  its coffers to support its business                                                               
this  year.  He asked  whether  Agrium  executives registered  as                                                               
lobbyists   when  they   sought   support   for  legislation   by                                                               
Representative  Chenault   or  did  they  come   with  charitable                                                               
organizations to talk about charities and their business.                                                                       
MS.  MILES  deferred   to  Ms.  Kempton  who   was  handling  the                                                               
registrations and had the most up-to-date information.                                                                          
SENATOR OGAN  advised that Agrium's registered  lobbyist, a hired                                                               
consulting firm, visited him and he  spent a few minutes with one                                                               
of the executives.                                                                                                              
SENATOR  ELLIS  asked  if  he knew  whether  the  executives  had                                                               
MS. KEMPTON  responded that Lisa  Parker, Executive  Director for                                                               
Agrium,  registers  every  year  and  is  usually  Agrium's  sole                                                               
lobbyist, but this year the company also hired Patten Boggs.                                                                    
CHAIR SEEKINS asked  what kind of a report a  lobbyist would have                                                               
to provide if one spoke to him.                                                                                                 
MS. KEMPTON  replied lobbyists don't  have to do that.  His staff                                                               
might  keep  records,  but  they   are  not  required  to  report                                                               
CHAIR SEEKINS  asked if it is  true that there is  no requirement                                                               
for him as a legislator or a  lobbyist to report to anyone who he                                                               
talks to about anything.                                                                                                        
MS. KEMPTON  replied there  is no requirement  for him  to report                                                               
his meetings to APOC.                                                                                                           
CHAIR SEEKINS asked how the law  serves notice to the public that                                                               
Agrium is trying to get an $11 million contract.                                                                                
MS. KEMPTON  explained that the  employer reports  any additional                                                               
monies spent on  lobbying activities on the  employer report that                                                               
is not reported on the  registered lobbyist report on schedule B.                                                               
If the  employer sent  other executives  to the  Legislature, the                                                               
employer would have to report when  they came, who came, who they                                                               
met with and what it cost.                                                                                                      
CHAIR  SEEKINS asked  if  it is  true that  the  lobbyist is  not                                                               
required to report that.                                                                                                        
MS.  KEMPTON replied  that  is true  and it's  also  true on  the                                                               
federal level.                                                                                                                  
CHAIR SEEKINS said the best  way to notify people who legislators                                                               
talked to is to put it on their websites.                                                                                       
MS. KEMPTON agreed.                                                                                                             
CHAIR SEEKINS  asked if that  would be  better than what  is done                                                               
MS.  KEMPTON replied  it depends  on  what you  think the  public                                                               
wants to  know. In 1976,  the Legislature felt the  public wanted                                                               
to know  how much  is spent  on lobbying  and on  which subjects,                                                               
including bill numbers.                                                                                                         
CHAIR SEEKINS  asked what if a  lobbyist is trying to  get a bill                                                               
MS. KEMPTON  explained that  would fall  under the  broad subject                                                               
category. Federal law  does not require a lobbyist  to report who                                                               
he met with either.                                                                                                             
SENATOR THERRIAULT commented that the  $100 fee and the paperwork                                                               
are pretty  minimal, but  he questioned the  real purpose  of the                                                               
other restrictions on the person's  activities. If the public has                                                               
full  disclosure  of  the  money   a  person  gave  to  someone's                                                               
campaign,   it's  already   capped  at   between  $100-$500   and                                                               
disclosed.  For  instance, a  volunteer  from  United Way  has  a                                                               
limited  ability to  participate  in the  political process  just                                                               
like  every other  Alaskan does.  That is  more onerous  than the                                                               
$100 to him.                                                                                                                    
SENATOR ELLIS said that the  $100-$500 contribution isn't the big                                                               
fish; it's that lobbyists can't hold fundraisers for candidates.                                                                
SENATOR THERRIAULT added  that they can't give  a contribution of                                                               
any size.                                                                                                                       
CHAIR SEEKINS noted that the  rest of the lobbyist's family could                                                               
give a fundraiser or contribute.                                                                                                
MS. KEMPTON  commented that the  prohibition on  lobbyists giving                                                               
to  candidates  outside  of  their   district  was  part  of  the                                                               
citizen's   initiative  in   1974  that   rewrote  the   campaign                                                               
disclosure. It was not part of the lobbying law.                                                                                
MS.  PAM LABOLLE,  President, Alaska  State Chamber  of Commerce,                                                               
said  she  supports  CSSB  89(JUD)  because  it  creates  a  more                                                               
reasonable  threshold  for  establishing who  is  a  professional                                                               
lobbyist  and   it  clarifies  the  definition   of  "communicate                                                               
2:55 p.m.                                                                                                                     
CHAIR SEEKINS said there are  some suggestions to further clarify                                                               
"communicate     directly,"    "influencing     legislative    or                                                               
administrative action" and what a lobbyist means.                                                                               
SENATOR THERRIAULT  asked for APOC's  position on a  person being                                                               
able to participate in campaigns.                                                                                               
MS.  MILES  responded  that was  discussed  at  the  commission's                                                               
meeting  in  Juneau  last  week.   All  five  commission  members                                                               
approved removing from  the campaign disclosure law  in AS 15.13,                                                               
the prohibition  of a  lobbyist giving  a lawful  contribution to                                                               
any candidate of her or his choice                                                                                              
SENATOR THERRIAULT asked  if they would be changing  the law from                                                               
a Cadillac to a Chevrolet if they adopted that change.                                                                          
MS. MILES said the Commissioner doesn't believe so.                                                                             
CHAIR  SEEKINS  asked  Ms.  Miles  to  forward  the  Commission's                                                               
recommendations  to the  committee  and put  the  bill aside  for                                                               
future action.                                                                                                                  

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