Campaign Expenditure Reform - Disclaimer Audio Ads or Not?

When HB 409 got tabled in House Judiciary on St. Patrick's Day people gave me different explanations.  This is one of the most important bills this year - it's the reaction to the Supreme Court's Citizens United decision which ended limits on corporate and union 'independent expenditures' in elections.  Alaska's laws ban such expenditures and so those laws are no longer valid.  But since they were banned, there are no disclosure laws either.

So that's what this bill is about.  There were a couple of bills in the House on this and one in the Senate.  Judiciary was the last stop in the House.  If it got passed on the House floor before the Senate bill got passed, then the House Bill would be the one to be selected.


But the House/Senate rivalry wasn't enough for Committee Chair Ramras.  He held the House Bill.  So, the explanation that makes most sense to me is this one:

If he holds onto the House bill, the last stop for the Senate bill will be the House Judiciary where he can make the changes he wants or kill the bill.  And that's where we are now.  SB arrived in the House this week.  And Chairman Ramras has clearly expressed his concerns, or at least the ones he wants us to know about.  They are:

1.  Will the requirement that people who pay for the bill must be identified in ads that have audio (radio and tv) mean that advertisers will have to spend a third of their paid for time for the disclaimer?
2.  If so, will this cause such advertisers to advertise in other media?

3.  Another concern he expressed was whether disclaimer might dampen discourse.
4.  He also framed this as protecting the little guy.  He's concerned about people like those who, in his words, killed his science building at UAF by lobbying for the UAA sports center.


What I heard everyone at State Affairs concerned about was that last minute ads would come out labeled as "Friends of Good" and nobody would know who paid for them.  Rep. Johnson was concerned about the audio announcements requirements.

So today a lot of time was spent on questions like:

1.  If BP pays for an ad, and the top three contributors would have to be announced, would the ad have to say "Paid for by BP, BP, and BP?" [@102 on the tape]
2.  If the Teamsters pays for an ad, would they have to list all of their members?

Are these serious questions or are these attempts to distract this to silly examples?  Department of Law attorney John Ptacin, if BP is paying for the ad, then it can say "Paid for by BP" plain and simple and it takes about one second to say.  The same thing for the Teamsters.

The real problem is when shell groups are set up like "Alaskans for Jobs" a group nobody knows.  It's groups like this that will be required to list their top three contributors.  And I don't have any problem with them doing it fast - but intelligibly.

Rep. Gruenberg argued today, as he did at State Affairs, that on radio you have to have an audio ad.  On television you need it as well, because sight-impaired people as well as people who listen to tv while doing other things are much more likely to catch the audio disclaimer than a written one.

It's clear that nobody is going to say, "Yeah, my corporate supporters can now spend all they want."  Instead they are saying, "We all believe that there must be disclosure and disclaimer"  [As I'm writing this I'm hearing a drug ad on tv that spent a looooong time listing the possible side effects of the drug.  This doesn't seem to stop the drug companies from advertising on television.] but a disclaimer of ten seconds in a thirty second ad
 is not reasonable. 

Ramras also said he was for the little guy.  The permanent corporations and unions, he said, can deal with requirement to keep records for six years.  But spontaneous short term organizations formed to fight one bond issue don't have the infrastructure to keep records for six years.


Below the audio are my rough notes and you can listen to the audio to get  exact words.



SB 284 starts at 45:43.


2:15  - I was having computer hiccups.  Sen. French is explaining bill SB 284.  The only unreported category left is individuals (actual people) making billboard or newspaper ads or other print ads are exempt. 
If you donate $50 to an independent expenditure against a candidate, your name will be reported to APOC, but not your occupation.
Ramras:  We would like the same rule applying to candidates will apply to this.  Page. 3 lines 16 to 20.

[Photo:  Sen French testifying. Reps Gatto and Holmes in background.]
Anyone giving under $100 there wouldn’t be an APOC record.  Something we’d want to flag for purposes the way environmental groups, unions etc. aggregate small contributions.  I want to be sure the tiny pin hammer has nails as does the sledge hammer. 

French:  Section 5:  Remnant of old bill we didn’t address. 
Sec. 6 - True source is a term of art in world of election reporting
Sec. 7 - defines officers.

Ramras:  Sec. 5 page 4 line 2.  Do not apply - for someone handing out flyers. 
French:  To be exempt from reporting - this is already in law - if total expenditures less than $500 total on billboards, signs, flyers. 
Ramras:  Can I spend $2000?
French:  $500 and no cents on billboards, signs, ??
Subsection 7:  defines officer better.
Subsection 8:  requires entities to establish campaign accounts.  We decided that they need to set up such an account to better monitor expenditures.
Subsection 9:  Defines who can make an expenditure.
Ramras:  SS 8:  how long do we hold these records
French: 6 years
Ramras:  Why so long?  I understand for corporation.  What if advocates for a sports complex… I don’t mind for unions, corps, environmental groups?  Are we giving the same for Sports events.  They have a narrow focus.  They scuttled my Life Sciences building in Fairbanks.
French:  Defer to Ptacin. 
Ramras:  You see my point - a surviving unit, not a group that is set up for a short time.  I don’t want people who become activists for a short time and not to be permanent.  We want people to participate and don’t want to dampen their enthusiasm because of record keeping requirements. 
Gatto:  $250 or less.  Does that mean or more?
French:  I had the same questions
Herron:  More overall question - State of Alaska or public entityt is considred a person as well, so State or Municipality cannot advocate for a GO bond. 
French:  They can advocate, but whether they can spend public money is another question. 
Concern about foreign corporations.  This provision drawn from federal law.  We don’t have to wait for federal elections commission to jump in, APOC could do it more quickly should a foreign national spend money n our elections 
Ramras:  What about mining companies that have American subsidiaries that pay taxes here. 
French:  Subsection 5, page 5.  List of people who cannot participate:
Foreign national, etc. 
Five:  Domestic Subsidiary.  Royal Dutch Shell and Shel Alaska.  Domestic Subsidiary.  If subsidiary is acting independently, considered an American comapny, no problem.
Ramras:  I haven’t a clue who is paying for the ads for the Pebble Partnership.  But our discussions with them make it clear the mothership is in the picture.  John Shively, what standard is conferring v. taking instruction?  Would you be prohibiting Pebble Prtnership if Shively’s organization takes instruction from the mothership.  Would this prevent …?
French:  Your question raises a series of proof problems that will always be difficult for APOC.
Ramras:  There we are again with the fear of ambiguity.  And ambiguity is construed against one party.  Where I find ambiguity in this bill, it seems to be construed against the damping of discourse.  I’m not interested in dampening discourse.  I’ m the 90 day session guy.  I like the public in discussion.  #5 of Sec. 10, there are ambiguities and if they dampen opportunities for discourse.  I’m trying to send signals of what I think are the right and wrong directions to go.

[Photo:  from front counterclockwise: Reps. Lynn, Gruenberg, Herron, and Ramras.]

French:  This bill is one of the great philosophical debates.
Sec. 11:
Sec.12 amends to clarify that a person may not expend anonymously except for already discussed sections.
Sec. 13.  [all the info that has to be provided]
Secs 13 and 14 will be the subject for much debate.
Herron:  I think that is where there will be some conversation.  Need to carve out difference between print and electronic, and audio.  If we can figure out how to say on tv and radio ad, somewhat to have five second profound statement, if I was listening or seeing, I would clearly know, rather some vague name and address.  I look forward to that discussion. 
Ramras:  Ptacin and others what others around this table pay about $10 for natural gas, Rep. Herron pays a lot and we pay $23/ in Fairbanks.  When we had hearings in FBKs, I had several businesses who put in several 1000 each and made impassioned speech to hear our plea.  That will be a test for me, to see whether that survives this legislation.  I’m less interested in the clash of titans - Pebble Mine and Anti - or Union and Non-Union, but interested in preserving the right of the public to genuinely and spontaneously participate in public square. 
Our standard was to protect the smallest amongst us.  In our effort to protect against the titans, we don’t hurt the little folks. 

French:  Disclaimers.  We were careful in 14 o split out requirements lines 25-31 to print and visual aspects of tv.  For radio we shortened it to alleviate the problem.  I’ve done it with a stop watch - his disclaimer wasn’t entirely consistent with the bill, and we dropped that to make it more succinct.  My concern is now enormous expenditures through an org called Alaskans for Jobs that was funded by Exxon, etc.  It took about ten or 12 seconds out of 30.
Ramras:  not acceptable to me.
French:  SEc. 15 - timing of the reports - ten days after report with APOC.  Your bill had stricter view of that.
SEc. 16 amends to require all persons required to report to save for 6 years.
Ramras:  Can we concentrate on deleted language in Sec. 17.  Large groups that send up funds for a little while. 
French:  In The past that would have been a non-group entity or group. 
Ramras:  Mr. Ptacin can we incorporate, or do you think it’s covered.
French:  Same on line 19, since we’ve expansively defined person and included everyone.
Ramras: I think we are fitting 9s and 10s into 14 size shoes. 
French:  This bill doesn’t change anything, it’s just trying to put the new players into what already exists.

18 - what happens if you break the law.  Class B misdemeanor.  Now no ambiguity ???
20 is the act.  Overview of the bill.

Lynn:  Is there separability?
French:  My understanding is every bill we have has separability.
Ramras:  Can we bring up Scott Smith and then Mr. Ptacisn.  Did you plan to stay for the week?
Ptacin.  It may be a good idea to stick around. 

Scott Smith:  Alaska Broadcasting Association and myself.  33% owner of K??? on Kodiak Island. 
1.  Audio disclosure in bill.  All broadcasters fully respect the need for full disclosures.  There was  a problem with auto leasing disclosure - because of the disclosure requirements, there was zero spent on radio, it went to tv because they could put it visually.  We are so crippled because of the disclosure that we just lose ads.  They’ll go to newspapers, tv, or websites.

2.  Brevity.  Sell in 30 to 60 secs.  I did produce a simulation.  My professional DJ could do it just less than 13 secs.  for little guy, that’s a big chunk spent on who they are. 

3. It’s possible if you force that much of their discourse is in disclaiming you will dampen discourse.

Gatto:  When you measured this was it in speed up or regular? 
Smith:  Hard read - not lightening.
Gatto:  Is there an FCC requirement for speed.
Smith:  ‘reasonable’
Holmes:  If you took that into speed like Cal Worthington commercial, do you know how long?
Smith:  Trim to maybe 9 before it was unreasonable?
Lynn:  Any studies on how much they might lose?
Smith:  Impossible to say.  Concern is great enough to fly me down here.  If you were going to talk about enormous companies, it would be a different strata of tolerance than with small.  Some are big enough and will spend no matter what.
Gruenberg:  Answering Gatto’s concern:  three places p. 6 line 29 for visual - communications should be clearly id’s.  P. 7 deals with line 26-28 - easily discernible.  P. 8 line 6 audio:  must be read in a manner that is easily heard.  I’m not sure it shouldn’t be understood. 
Ramras:  Rocking and smiling.  Thinking about what you said. 
Gatto:  Have you ever surveyed, not candidates, campaigns, whether the public gives a rat about this?
Smith:  No.  But there are FCC requirements.
Ramras:  Scott, as the president of the ABA, I’d like to take the bills and put a circle around them about whet they are about.  One of the discussions is about disclosure but the other large issue for me is discourse.  Are we opening or dampening.  Managing amounts to unions, pro industry groups, pro environment, large players.
But as someone in business, when groups come to you = we’ve talked about Shell and Pebble, that’s the large people, but I’ talking about the boiler people or UAA sports people.  How often approached by these groups for ads.

Smith:  volume of groups that approach?  We can see in Muni election, have 5 to 9 entities working different items, whether school bonds, and - number of private groups.  In major statewide elections, bring out larger groups both in and outside the state. 

Ramras:  Take me to Kodiak.  This August, we’ll have Parental Consent
Lynn:  Parental notification.
Ramras:  parental notification, etc. general obligation bond.  Will you hae local groups in Kodiak and statewide groups from Anchorage?
Smith:  Yes, it is a reasonable amount of revenue that keeps people employed. 
Ramras:  Any questions?  I have plenty.
If Royal Dutch Shell wanted to… if the section requiring three people, then who would be the three people from Shell.  If the producers, three corps, who would it be.  If the Unions who would it be.  How would we group the three top people fro diffierent organizations
Smith:  Great question.  Asked to come ask if we had to name more than the top contributor.  I would say you could just say the company name. 
Ramras:  What if law says top three.  Do you say: BP, BP, BP?  If a union and not a consortium.  Teamsters 959 or pick the members?
Smith:  I hope union name enough.  The names of the people wouldn’t mean much. 
Ramras:  3:10.  Members:  your call.  Do you want to bring up Ptacin now?

Ptacin:  Dept. of Law. 
Gruenberg:  For a while my office was trying to track cases where CU was discussed to see how fed and state courts were utilizing that case.  We stopped three weeks ago.  Anything in last three weeks.
Ptacin:  two. 
1.  Provision didn’t allow people to group assemble and limit money they could bring in.  A district court case, doesn’t impact analysis for this bill
2.  Different limits on soft money, we don’t address that.
3.  Case coming to SC which would extend anonymous speech to new areas, that could hae an impact.
Gruenbertg:  in ideas what the areas would be?
Ptacain:  Signatures in ballot measure could be withheld from the public.  A distinction that may or may not stand.  Argument at end of month, probably decision in late June.
Herron:  So you can advertise in all sorts of print.  You have space, but in TV and radio, when it comes to declaring who, is there some way we can do it where Joe Schmuckateli is against this”  rather than some vague name and their address?  I’m not talking about print or anything written.
Ptacin:  Distinction between disclaimer and disclosure.  Telling the messenger they have to deliver the message a certain way. 
Herron:  Say, 30 secs.  Not how, but if it takes 12 seconds, 13 seconds to explain why you bought the ad. 
Ptacin:  I’ll testify on Friday.  I think it requires more time. 
a.  I’m for this or against.
b.  this organization
Not the same neutral stuff as paid for by. 
Ramras:  for me it seems to be about disclosure and, in the interest of fuller disclosure are we dampening discourse.  I understand the reaction to Cu as it relates to disclosure but I don’t want it to impair discourse. 
Ptacin:  APOC v. Stevens - case 4-5 years ago.  If ambiguity in statues, enforcibilty is harder.  Dampening discourse.  This is the debate after CU.  which allowed entities that couldn’t speak before and now they can.  Does a disclaimer law overly burden that newly found right. 
Ramras:  If we are trying to regulate a right that has been restored to persons, like introducing pike into the lake, those pike will eventually consume the other fish.  Will our regulations consume all the other fish?.
If BP has an ad, who are there three highest contributors.
Ptacin:  If BP Alaska, from their own corporate treasury. 
Ramras:  They wouldn’t have to disclose their three top contributors?
Ptacin:  If there are no top five contributors you don’t have to list the top five.
Ramras:  I’m a lay person, that’s not how I read it.  But people are nodding.  What about teamsters?  They have lots of members how would they do it?
Ptacin:  They could just say teamsters, unless there are lots of other groups joining them. 
Adjourned 3:20pm.