56% Of the Alaska Redistricting Board Expenditures Were Legal Fees

Overview

This is a budget post.  Not for the faint of heart. One has to look at numbers and then answer these questions: Did the Board spend its money wisely? Did anything stand out as you looked at the budget?  What does it mean? In this and a second budget post I'm going to: Post the copy of the budget I got as of July 22, 2022  for those with more budget savvy and  as a precedent, so that future Redistricting Board budgets get published and reviewed publicly The Board's biggest single expense category was Legal Fees.  In this post I look a bit more closely at the section on Legal expenses and raise some issues to consider in the future  Raise some questions about the payments made to Board Members (in a later post).  The only conclusion I can make at this point is that saying the Board Members were volunteers, as many people did, is more than slightly misleading.

I feel a bit like a sculptor who has a slab of marble and is trying to release the statue that is hidden inside the stone.  I have a slab of data in the form of budget expenditures and I’m trying to figure out how to release the meaning of that data in a way that makes sense to the reader. And I’m also not completely sure what the meaning of all the data is myself.   

I’ve had a copy of the Alaska Redistricting Board’s budget as of July 22, 2022 since that date and I’ve been walking around it trying to figure out where to start chipping away.  I went through it and sent a bunch of questions to the Executive Director which he answered in detail.  

Budgets, on the surface, are lists of categories and numbers.  While they (should) list all the expenditures, one needs some experience and skill to tease out what's hidden between the lines.  I don't claim to be a fluent interpreter of budgets.  

The point of reviewing the budget is to keep the Board accountable in terms of the public monies it spent.  The underlying question one needs to answer is:

Did they use their money efficiently and effectively?

To make that determination, a budget analyst might ask: 

1. Did the Board stay within its budget?  
2. Are there any unusual expenditures?

1.  Did the Board stay within its budget?  

$3.5 million were allocated to the Board (Board Executive Director Peter Torkelson said this was based on what the 2010 Board spent), but the 2020 Board only spent $1.97 million by July 22, 2022 when the Board staff sent me the budget. 

Of course, staying within your budget assumes that the original budget was reasonable.  Comparing it to the 2010 Board is one benchmark.  A big savings this round, according to Board Executive Director Torkelson, was that in 2010 the trial was in Fairbanks so there were lots of travel expenses. But there was also more significant litigation AFTER the second Proclamation was approved in 2010.  That Board did NOT broadcast its regular Anchorage meetings across the state.  But I don't know that there is a better comparison organization.  And this Board spent considerably less, so far.  

Of that $1.97 million total,  $1,111,513.46 went to SCHWABE WILLIAMSON & WYATT, the company that won the contract to give legal advice and to represent the Board in court. (Link shows proposals for all firms that submitted them including Schwabe).   

That's the main thing that stood out for me.  I also have questions about how much money was spent on retirement funds and other things that suggested Board members were possibly treated as state employees rather than volunteer Board members.  But I'm awaiting more information and that will be another budget post.

Did The Board Spend The Money Wisely?

I would note that I believe that the Board staff was dedicated to serving the public interest. My belief is based on numerous conversations - in person, by phone, by email - that I had with staff, particularly the Executive Director Peter Torkelson.  He was always forthcoming with information and documents - including sending me this copy of the budget.  I also closely observed the Board in action from December 2020 through the last meeting held in May 2022. Torkelson put an unprecedented amount of information on the Board's website.  Well, "unprecedented" is not a high bar, considering what little past Boards did. The previous Board also did much more than past boards had.  Technology has moved quickly and Torkelson had the skills and public interest values to take advantage of it. 

 I hope future Boards can match the level of transparency of this Board.  Not only was there an enormous amount of documentation (maps, transcripts and video and audio of meetings, transcripts of public input, etc.) but it was also put up with minimum delay - sometimes immediately, often within a day, usually within a few days, rarely more than a week.   

I suspect this budget reflects a Board and staff that was pretty much playing by the rules when it comes to how money was spent.  Some Board members may have spent more on travel and hotels than others, but not enough to matter that much.  The Board probably could have saved a bit of money here or there, but this organization reincarnates once a decade with new players and it's reasonable to expect them to learn along the way.  And in many cases, there were extra expenses due to the Board being transparent in ways past Boards haven't been.  

The only large expenses that immediately stand out as avoidable are the legal costs for defending the second Proclamation Plan that continued the attempt to give Eagle River two Senate seats.  We don't know what the attorney advised in Executive Session, but we do know the three Republican majority members of the Board were more than eager to make that decision.

The Whole Budget:   

Alaska Redistricting Board Fy22 Spending as of July 22, 2022 by Steve on Scribd

Just Because the Grass Is Green, Doesn't Mean Someone Painted It Green

Just because 85-90% of the legal fees came after the original Proclamation Plan was approved, doesn't mean the attorneys advice caused that.  A key reason for the delay in posting this has been my concern that by raising the idea that an attorney might increase his income by insuring post Proclamation litigation, readers would conclude that happened.  Voters these days believe some of the most implausible accusations against candidates and parties.  In those cases it's mostly pure fiction, while in this case there are facts that show most of the legal fees were post Proclamation.   Can I even raise the issue without having some readers conclude this was intentional?  Probably not.  But while I can't rule it out 100%, I have NO evidence to suggest the timing was anything but the natural flow of the redistricting process and I will outline below why I think it's highly unlikely there was any intentional action by the Board's attorneys.  I raise this possibility only because I thought it could happen in the future and so legislators and Board members in 2030 and beyond should just be aware of it.  After writing this all out, I don't think this is an issue. Some may say I protest too much here, but 1) the budget begs for this issue to be raised and 2) once raised it should be quickly dismissed without reflecting poorly on the attorneys who represented the Board.

On the other hand, there were unnecessary legal expenses to defend the second Proclamation Plan, but that was due to the Board's Republican Majority's decision.  I'll mention briefly that below. 

The Legal Expenses - 85-90% were paid after the First Proclamation Plan was approved

The chart below shows the payments made to the attorneys' firm Schwabe, Williamson & Wyatt over time.  The first column shows key events in the timeline in relationship to the payments.  

9/01/2021 - 10/25/2021 ($55,904) The first payments were made while the attorneys attended Board meetings and gave advice to the Board to help the Board understand the parameters for their mapping decisions set by the Alaska and US Constitutions and past Supreme Court decisions as well as other Federal and State legislation.

11/22/21- 1/25/22 ($229,626) -  Proclamation Plan was approved 11/10/21.  After this date the plan was complete.  The attorneys' bill goes up sharply in response to the five lawsuits challenging the Board.  It was also after there was a sharp public rupture between the majority of three Republican Board members and the two members not identified by party.  That dispute only related to one of the five lawsuits - the two Eagle River Senate seats.  The other four would have been filed anyway and would have required a lot of attorney time.  

3/15/22 - 3/16/22 ($370,015) - Judge Matthews ruled on 2/15/22.  These bills clearly represent work done earlier, during the trial and then work appealing parts of his decision and responding to plaintiffs' appeals. 

3/29/22 ($175,797) - The Alaska Supreme Court ruled on 3/25/22.  

4/25/22 ($122,141) - The Board picks Option B for second Proclamation Plan (which still gave Eagle River two Senate seats) on 4/13/22.  

5/31/22 - 7/1/22 ($158,029) - The Superior Court and the Supreme Court ruled on May 17 and May 24 respectively.  Both essentially told the Board to join the Eagle River house districts into one Senate seat.  The Board quickly complied.  At this point, we await the longer Supreme Court decision which will explain its ruling in detail (setting precedents for future Boards) and decide whether the 2022 map will become the permanent map or have the Board make the final map.  I've written about the factors that likely will affect that determination here.

Events	Date of expenditure	Recipient		Category of Expense	Amount
	09/01/2021	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	16,098.71
	09/01/2021	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	3,403.53
	09/21/2021	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	10,414.08
	10/25/2021	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	25,988.16
11/10/21 Proclamation Plan approved	11/22/2021	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	18,830.00
	12/27/2021	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	33,887.50
	01/25/2022	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	176,908.45
2/16/22   Judge Matthews ruling	03/15/2022	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	14,895.55
	03/15/2022	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	32,623.90
	03/16/2022	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	322,495.83
3/25  Supreme Court Rules	03/29/2022	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	175,797.40
4/13  Board picks Option 3B	04/25/2022	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	122,141.21
5/17/22 - Judge Matthews 2nd Ruling 5/24/22- Supreme Court Ruling	05/31/2022	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	65,870.38
	07/12/2022	SCHWABE WILLIAMSON & WYATT PC		ATTORNEY FEES	92,158.76
					1,111,513.46

[This table combined information from the budget as provided to me by the Board's Executive Director plus dates I retrieved from blog posts on this site.]

What do the charts tell us about the legal representation?

1. We have to take these figures and the juxtapositioning with dates of payments and events with a grain of salt.  The timing of the bills and the State's actual expenditures doesn't necessarily neatly match when the work was done.  Rather, it reflects when the firm was able to calculate and submit the bills and the State issued payment. 
2. That said, the bulk of the attorney costs come after the initial Proclamation Plan was completed.  The bills are for litigation, only a tiny fraction for advice.  Peter Tolkerson told me via email that "Non attorney time and costs make up less than 10% of total legal spend. . . Non-attorney staff [para-legals] costs have run about 4% of total legal spend."
3. Did the Board get hit with excessive legal fees?  I'm guessing not.  There have always been challenges to Redistricting Board proclamations.  This time the Board's attorney had to fend off five challenges at once in a very short period.  Four of the challenges were for decisions the whole Board agreed on.  One (Eagle River Senate seat(s)) was for a decision the Board was  bitterly split on.  Did the attorney give advice that the majority's decision was defensible or did he advise against it?  We don't know.  It happened in Executive Session.  We do know that the two minority Board members argued publicly, loudly, and ultimately correctly, that the Eagle River decisions in both the first and second Proclamation plans were unconstitutional and they would lose in court.                                                  We also know that the original "legal subcommittee" was made up of the two attorneys on the Board - Budd Simpson and Nicole Borromeo.  But sometime later a new subcommittee formed that had only Simpson and John Binkley. Borromeo was cut out of the process.   So it's possible we will eventually hear about some of what happened behind closed doors at Executive Sessions, it's unlikely we'll hear anything about what happened after Borromeo was replaced on the legal subcommittee..  
4. More experienced and astute budget analysts might well be able to distill more information from the budget as presented to me.  I hope publishing it here will pique their interest and if I missed something important, someone else will raise it.
5. Below are some additional emailed comments about the legal portion of the budget in response to questions I had about how the Board was actually billed.  I'd noted in my question that the Schawbe bid for the contract had included a slightly discounted half day and full day rate instead of the hourly rate.  Again, from Peter Torkelson:

"The RFP response offered some discounts and then we negotiated further for additional savings.  The more meaningful savings have been the bulk discount we hammered out with the original contract.*  At the time we weren't sure we would need it, but in retrospect, that was naive. We were likely to rack up significant bills for any number of our unanimous decisions, as you noted (Valdez, Matsu, Skagway etc). *The negotiated bulk discount is 5%  Of Counsel and Paralegal fees (not partner attorney fees) from total firm billings of $100k - $500k and 7.5% from 500k to $1M and 10% over $1M per calendar year.  So far we have saved about $20k."      [I had to get clarification on "5% Of Counsel." Torkelson wrote back "'Of Counsel' is a common title for attorneys in a law firm who are not yet partners.]

Torkelson also noted that because the trials were in Anchorage this time (2010 trial was in Fairbanks), the Board saved money on travel and lodging compared to the previous Board.   

Is there credible evidence that the Board's attorney intentionally gave the Board advice that would increase the likelihood of Post Proclamation litigation?  [Spoiler Alert:  No!]

The only 'evidence' that there might have been bad advice with the intent to increase post Proclamation litigation is purely theoretical.  It's this: 

1.  Law firms are for profit businesses.  Their goal is to make as much money as they can.  If 90% of the income from representing the Alaska Redistricting Board comes from defending the Board from post-proclamation legal challenges, there’s an incentive there to make sure there are legal challenges.  

That's it. It's theoretical. No facts.

What then is my evidence that would suggest that just as grass grows green naturally, extensive litigation flows naturally from Redistricting Proclamation plans?

1.  There are other incentives for attorneys besides money.

I emailed the Board's attorney, Matt Singer, to find out what his motivations for bidding on the contract were.  

"I'm doing a post on the Redistricting Board Budget and the fact that about 56% of the budget went to legal fees and of the legal fees, about 90% were paid after the original Proclamation Plan was approved.  I'm trying to come up with a list of reasons why a law firm would seek such a contract in addition to money.  Could you send me the list of reasons you and your firm bid on this contract? 

His response was longer and a lot more thoughtful than I expected.  

"Regarding your question below, in outdoor pursuits, we use the phrase "Type II fun" to describe a task that is difficult at the time, but feels rewarding afterward, often because it challenges the practitioner to test their limits and grow. I'd call Redistricting a Type II kind of fun for a lawyer. The subject matter is fascinating and nuanced, the issues are important, the work is very demanding, and it is all done under immense time pressure and scrutiny (including by friendly bloggers like yourself). 

In addition, our "Hickel process" in Alaska redistricting is a deep dive into culture, history, geography, transportation, and a myriad of other interesting tidbits about how Alaskans live, work and play. Many of us who chose to make our professions here in Alaska did so out of a deep interest and admiration for this great state. Redistricting, at its core, is about understanding Alaska and its people. We were blessed with a board that collectively has covered just about every inch of this state, and so being a fly on the wall for their discussions and deliberations was a great privilege.

I suspect it is no coincidence that many of the lawyers who competed with us in response to the Board's RFP ended up being lawyers representing challengers in the redistricting process. For those of us interested in the subject matter, it would be hard not to get involved if given the opportunity. 

Lawyers are interested in working on redistricting for many of the same reasons that you have taken the time to follow and write about the subject. Are you doing it for the money, or are there other factors at play?"

I got to watch Singer extensively at Board meetings and Court hearings.  We even interacted a few times.  My gut says that this is a sincere response to my question and not carefully crafted argument to sway a friendly blogger.  There are more incentives than money involved.   

Another key incentives that come to mind is upholding one's reputation, and giving bad advice doesn't help that at all.  

2.  Litigation naturally flows from redistricting Proclamation Plans - The Statutes and Constitution even anticipate that

In a follow up email Singer wrote: 

". . .it sounded like you are musing about why the attorney’s fees are mostly incurred after the proclamation plan is adopted.  This is a bit like musing about why most of a book’s pages come after the prologue.  In Alaska redistricting, litigation has been a part of the process in every cycle since statehood, and the litigation follows the adoption of the proclamation.  In other words, the time consuming legal work comes after the proclamation.  As you saw this round, even parties with longshot claims will file lawsuits in a bid to influence the outcome.

Litigation in redistricting is such a certainty that our legislature defined the role of the Board’s lawyer as this: “defend the plan and board in all matters concerning redistricting until a final plan for redistricting and a proclamation of redistricting have been adopted and all challenges to them brought under art. VI, sec. 11, Constitution of the State of Alaska, have been resolved after final remand or affirmation.”  Alaska Statute 15.10.220." 

Let's also look at art. VI, sec 11 of the Alaska Constitution that he cites :

"Any qualified voter may apply to the superior court to compel the Redistricting Board, by mandamus or otherwise, to perform its duties under this article or to correct any error in redistricting. Application to compel the board to perform must be filed not later than thirty days following the expiration of the ninety-day period specified in this article. Application to compel correction of any error in redistricting must be filed within thirty days following the adoption of the final redistricting plan and proclamation by the board. Original jurisdiction in these matters is vested in the superior court. On appeal from the superior court, the cause shall be reviewed by the supreme court on the law and the facts. Notwithstanding section 15 of article IV, all dispositions by the superior court and the supreme court under this section shall be expedited and shall have priority over all other matters pending before the respective court. Upon a final judicial decision that a plan is invalid, the matter shall be returned to the board for correction and development of a new plan. If that new plan is declared invalid, the matter may be referred again to the board. [Amended 1998]" [emphasis added]

3.  Four of the six challenges to the board were on decisions the board had agreed to unanimously.  I say six challenges, though two were related to the same issue - the Eagle River Senate pairings.  One brought by one set of plaintiffs after the first Plan and another brought by different plaintiffs after the second plan.

4.  Redistricting law is complicated and ambiguous.  It is made up of the Federal and State Constitutions, (including the minutes of the Alaska State Constitutional Convention), Federal and State statutes, and what judges have interpreted in prior Redistricting court cases.  One has to sift through all that to guess what will be ruled legal or illegal.  For example, the Board unanimously agreed to pull Cantwell out of the Mat-su Borough and put it into a huge Interior district so that it was with other Ahtna villages.  This was despite clear past court rulings that Boroughs should not be broken if at all possible and it violated the Constitutional requirement for compactness.  The Board knew the law was against this decision.  But it was also a strong request by the Calista and Ahtna Native Corporations arguing the Cantwell was Socio-Economically Integrated with the other Ahtna villages.  It didn’t involve a lot of people - maybe 200, and fewer actual voters.  It was challenged by the Valdez plaintiffs and by Mat-Su.  The Superior Court judge let it be in his ruling.  But the Supreme Court said they couldn’t do it.  Putting Cantwell back into a Mat-Su district didn’t get either Valdez or Mat-Su the bigger changes they wanted.  The point here is that there are lots of ways an attorney can justify a decision and lots of ways one can challenge a decision.  And it’s also unclear whether the advice would result in a lawsuit or not, or which way the Court will rule.  I’d note that had Valdez been originally put in a district that went up the highway to Fairbanks, they probably wouldn’t have challenged the decision even if Cantwell had been part of that district.  Maybe Mat-Su wouldn’t have sued either.

5.  Redistricting happens every ten years and only a few attorneys get involved in Alaska.  So there are relatively few opportunities to practice redistricting law and to become an expert in this area.  Understanding it well comes from reading everything about it - nationally and locally - and being involved in the process.  Both paths together help bring a better understanding.  And both take a lot of time, more than most lawyers who aren’t involved have time for.  And because redistricting only happens once a decade, there may well not be a chance to use one's expertise in court again.

 6.  Redistricting is highly political and somebody will always believe they were the loser and the map should be changed to accommodate their grievance.  This is implied in my second point - there's always litigation.  Someone or several someones will be aggrieved enough to pay an attorney to challenge some part of the Board's final map.  It's happened in every round of Alaska redistricting.

Conclusion

My conclusion is that it makes no sense to misadvise the Board in hopes of increasing litigation.  An attorney can give the Board the best possible advice and there will still be litigation.  

I'm leaving out two other areas of exploration that might fit in this post.  

• An examination of the kinds of advice Singer did give the Board.  
• There were key areas where at times the advice seemed either overly broad and/or it changed.  This was particularly true in terms of the early mantra - everything within a Borough is Socio-Economically Integrated (SEI).  At one point this stretched to: Mat-Su and Anchorage have had overlapping districts so everything in Anchorage and Mat-Su is Socio-economically integrated.  And then at another point - since Mat-Su and Valdez have shared a district, they are SEI.  And since Mat-Su and Anchorage are SEI, all three are SEI. Ultimately the Eagle River Senate seats were overturned, at least in part, by a similar concept - communities of interest - which judges said were not the same in all Anchorage neighborhoods.
• Other concepts like contiguity and the role of public participation in redistricting offered challenges in this round of redistricting, but these are matters for the court to decide
• A look at the nature of the attorney-client relationship
• Alaska Legal Rules of Professional Conduct outlines what is expected of attorneys.  Eagle River plaintiffs' attorney Holly Wells raised the issue of different ways to think about this relationship when it comes to attorneys of public entities.  Is their duty to the whole Board, the Board majority, the public, and how do you balance these?  Matt Singer would rightly point back to the role of the attorney to the Board he cited above from the statutes.
• Directly related is what role public testimony should play in redistricting.  Superior Court Judge Matthews ruled that the Board didn't give it enough weight in both the Eagle River suit or the Skagway suit.  The Supreme Court disagreed in the Skagway case, and we haven't yet heard their thinking on this in the Eagle River case which they seemed to rule against the Board based on other issues.  
• Conflicts of interest also have to be explored - This came to light when Valdez attorney pointed out that the Board's attorney also represented Ahtna Corporation in two upcoming Supreme Court cases and claimed that he should have told the Board that when they were considering Ahtna's role in getting the Cantwell moved out of the Mat-Su district.  
• The attorney's role is to explain the law as best he can and predict the likelihood of winning in court.  The Board then weighs that advice and decides how much risk they are willing to take.  But in this case, the client (the Board) does not bear the financial cost of a bad decision, the public does.

This post, many would argue, is already too long.  The first additional point - how redistricting criteria were explained and used and clarification the Supreme Court ought to make - I've already discussed in detail in various previous posts.  Here's one that succinctly identifies key issues/terns I'd like the Court to clarify.

The second point - on the attorney-client relationship - I'd like to explore in a future post.  

To reiterate - I'm personally convinced there was no wrong-doing on the part the Board's attorney to increase the post Proclamation litigation.  There was no need since it happens anyway even with the very best advice.  

  

 (Yes, I've been toying with this way too long.  But this is more for the 2030 Board than for today.  The only deadline I've given myself is to post this before the Supreme Court publishes its full opinion to supplement its brief ruling back in May.  And I figure that won't happen at least until after the November 8 election.  So I'm closing in on that deadline.  People are probably focused on other things right now, but I need to get this up finally.)