Committees hear proposals to tighten ethics laws

Critic: Limiting stock ownership hinders state's recruiting of good employees

Posted: Wednesday, April 27, 2005

Proposed changes to Alaska's ethics laws were heard Tuesday in House and Senate committees, as lawmakers work to close holes in the statutes revealed by an investigation into former attorney general Gregg Renkes.

Companion bills by Sen. Hollis French, D-Anchorage, and Rep. Les Gara, D-Anchorage, would establish a "bright line" limit of $5,000 or 1 percent stock ownership in a company that a public employee can own and still work on a state matter involving that company. Gara's bill was bumped up to a $10,000 limit in committee.

Two other bills by Sen. Ralph Seekins, R-Fairbanks, draws the line at $10,000 or 1 percent, but makes several other changes to both the executive and legislative ethics laws. Among those changes, Seekins proposes charging anybody who talks about an ethics complaint that has been filed or will be filed with a misdemeanor.

Renkes owned between $71,880 and $124,680 in KFx Inc. stock when he was working on a coal deal between Taiwan and Alaska that included using a coal-drying process patented by KFx.

Former U.S. Attorney Robert Bundy, hired by Gov. Frank Murkowski's office to investigate the conflict of interest allegations against Renkes, found that Alaska law did not say how much was too much stock ownership to be considered a conflict. Bundy, using an old attorney general's opinion, concluded Renkes' holdings did not cross the line.

Renkes resigned in February amid continuing allegations of wrongdoing.

All the bills heard Tuesday are meant to define what Bundy found lacking in the law. Seekins' and French's bills were heard together in the Senate State Affairs Committee, Gara's in the House State Affairs Committee.

Seekins said everybody agrees that high ethical standards are essential to good government, but "nobody agrees on how to do that. Nobody agrees on where that clear bright line exists."

In the House committee, finding that line proved to be problematic. After the original proposal of a $5,000 limit, subsequent proposals of $50,000, $40,000 and $35,000 were rejected before the committee settled on raising it to $10,000.

"Remember, we're not just picking a number out of the air," Gara said. "The whole point of the ethics law is we don't want you to self-deal. We don't want you to make money or benefit yourself off of your state employment."

Rep. Jay Ramras, R-Fairbanks, proposed raising the limit. He said Gara has good intentions, but the bill creates a litmus test that could harm the state's ability to attract high-quality public employees.

"I just think this is a bad bill," Ramras said. "It's got good intent, but it's a bad bill, so I'm just objecting because I just think this thing stinks and I want to be on the record for saying so."

In the Senate, questions were directed toward Seekins' confidentiality restrictions. Seekins and State Affairs Chairman Gene Therriault, R-North Pole, compared the changes to a grand jury hearing.

If probable cause is found, the matter is released to the public. If not, it remains confidential, protecting state and legislative workers from frivolous accusations, they said.

"A stiff penalty must be imposed on people who knowingly and wantonly" break confidentiality, Seekins said.

State Sen. Kim Elton, D-Juneau, said he interpreted the bill to mean that he would not be able to tell his wife about a complaint he filed, or consult an attorney before he filed a complaint. Also, he said, he may never know if a complaint was filed against a staff aide of his.

Seekins said that was not his intent, and changes to the bill were being drafted to clear some of those questions. But there must be containment for the confidentiality clause to work, he said.

"Where do you stop the gossip chain to protect the innocent?" he said.

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