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On December 6, 2006, Anderson was indicted by a federal grand jury on seven felony counts of extortion, bribery, conspiracy, and money laundering involving allegations that he took bribes of nearly ,000 in return for using his official position as a legislator to advocate for the certificate of need (CON) issuance for a residential psychiatric treatment center (RPTC) associated with the Gov.Frank Murkowski "Bring the Kids Home" initiative, and for contract changes relating to a community confinement center (halfway house) in Anchorage . Beginning in 1991, while still a student at UAA, he served as chief of staff for Representative Terry Martin, an East Anchorage Republican who was first elected to the House in 1978.In 2002, Anderson, acting as CHARR's executive director, received ,800 from the association.In 2002 Anderson, then serving as executive director of the Anchorage Cabaret, Hotel, Restaurant and Retailers Association (CHARR), a trade association of Anchorage-area bars and restaurants, ran as a Republican against Democrat Owen Carey for Alaska House District 19, covering the Muldoon area of Anchorage.(The Senate sponsor of the bill, John Cowdery, had received a 0 campaign contribution from one of the owners of the business).Anderson played a significant role over two years from 2002 to 2004 in changing the composition of Anchorage's Northeast Community Council to reflect more conservative political and economic views.By July 2004 he had received at least ,500 in VECO-related contributions for his 2004 reelection bid.Members of the community council later recalled Anderson attending all their meetings during 2003, and assumed he was attending as their representative in the state legislature.
The bill applied the DNA sample requirement retroactively to people currently imprisoned or on parole for those crimes, as well as anyone required to register as a sex offender.
Anderson stated that he intended to serve out the remainder of his term and not run for re-election.
Alaska law specifies that legislative candidates must have lived in their district for at least one year immediately before filing for office, but nothing is said in the statute about legislators being required to maintain residence in their district for the entire course of their term.
Anderson told the Anchorage Daily News the contract was to advise the association on member relations and to research telecommunications policies in other states.
As chair of the House Labor and Commerce Committee, Anderson dealt in an official capacity with telecommunications issues, but Anderson said he was careful to avoid conflicts of interest and did not push his employers' interests.