There are no conflicts of interest in Pawlenty’s Minnesota

BY Jon Collins
Published: Dec. 22, 2009
Source: The Minnesota Independent

conflict-of-interest-copy-580x356Since Gov. Tim Pawlenty took office in 2003, not one public official has filed a conflict-of-interest disclosure with the state ethics board, an unprecedented streak for a disclosure system that had routinely been used for the previous three decades.

Critics blame the precedent set for public officials by the Pawlenty administration’s own ethical lapses, as well as the outdated disclosure requirements that are rife with loopholes.

Minnesota was one of the first states to create an agency to oversee the ethics of public officials in the wake of the Watergate scandal. A major component of ethics reform was a requirement that elected and appointed officials who faced potential conflicts of interest file a written statement with the ethics agency, now called the Campaign Finance and Public Disclosure Board. These disclosure filings were designed to keep the public aware of situations where officials might benefit from decisions they made as part of their routine duties.

Dozens of disclosures were filed in Minnesota between 1975 and 2002, according to the board’s annual reports. Prior to 2003, there were only a handful of years that no disclosures were filed. But since Pawlenty took office — and appointed many of the state’s officials, including the six governing members of the disclosure board — not one form disclosing a potential conflict of interest has been filed.

Pawlenty and some of his high-profile appointees have faced criticism over repeated ethical stumbles, including a hefty2002 fine against Pawlenty for illegally coordinating his campaign ads with the Republican party.

Last year, Lt. Gov. Carol Molnau, who formerly served as a legislator, also faced allegations of conflict of interest when a Star Tribune investigation revealed she’d sold her farm in 2000 for many times its assessed value only eight days after pushing through legislation funding a nearby highway.

Pawlenty also riled critics with his 2002 appointment of former 3M employee Sheryl Corriganas commissioner of the Minnesota Pollution Control Agency at a time when the state was dealing with contamination of water supplies by Corrigan’s company. Corrigan only recused herself from 3M-related business in a letter to the governor a year and a half after her appointment.

Neither alleged conflict of interest was investigated by the Campaign Finance and Public Disclosure Board, which relies mainly on citizen complaints to spur investigations. But in interviews with the Minnesota Independent, multiple lawmakers expressed concern about the lack of prompt disclosure or enforcement in Corrigan’s alleged conflict and the precedent set by the then-young administration.

Hamline University professor David Schultz, a specialist in professional ethics and the legislative process, said Pawlenty institutionalized a “lower standard of ethics” as a result of these incidents and his overall approach to governmental ethics.

“Part of the issue here is that this is an administration that doesn’t take seriously the administrations before it in terms of ethical practices and conflicts of interest,” Schultz said. “That translates down into the unwillingness of people across the board in government to file these kind of forms.”

Pawlenty spokesman Brian McClung said the statute clearly places responsibility for the disclosure filings with individual officials, not the governing administration.

“It is up to each public official to either abstain from voting or taking action that presents a conflict or file the form as required by statute,” McClung said. “To claim that the governor or any other person is responsible for someone else’s failure to file the form, if necessary, is ludicrous.”

But Sen. John Marty, DFL-Roseville, who spearheaded earlier ethics reforms and is running for governor, said it’s expected that some conflicts might arise for public officials, but that the precedent needs to be set at the top of the administration.

“If the commissioners don’t disclose, then their employees aren’t going to feel the need to disclose,” Marty told MnIndy. “[Pawlenty] and his departments have a responsibility to disclose, and if they don’t think the laws are tight enough, to tighten them up.”

McClung said the Pawlenty administration is open to ethics reforms.

Ethics requirements loopholes

The decline in conflict-of-interest disclosures is partly due to the broad wording of the 1974 statute that requires such a disclosure only when an official “would be required to take an action or make a decision that would substantially affect the official’s financial interests or those of an associated business.”

The broad language allows public officials to slip through informal loopholes well before they’re required to file a public disclosure with the state board, Schultz said.

“The laws so loosely define conflict of interest for public officials and require them to disclose so little,” he said, “that you can probably engage in a lot of practices without ever violating the law.”

In the legislature, for instance, both the House and Senate excuse members from voting if they declare a conflict of interest, although the reason for the legislator’s abstention isn’t recorded. The statute also allows that there won’t always be time to write out the disclosure forms, and in that case permits the official to notify their superiors, who are required to reassign or excuse the official.

Citing the details of the statute, Campaign Finance and Public Disclosure Executive Director Gary Goldsmith said the board “only gets the notice [of disclosure] if the person has a conflict and is unable to resolve it under the other provisions of the statute.”

“I’m not sure there would be a situation where a public official or a local official with a metropolitan government unit would not be able to either abstain from voting or [pursue] some of the other possibilities, [like] the superior finding somebody else to participate in that action,” Goldsmith said.

These statutes for declaring a potential conflict are so weak, Schultz said, that they are currently only “symbolic.”

The situation is further complicated by the limited statements of economic interest required of public officials. Although officials are required to submit the forms listing their jobs, investments and some property, it’s up to the individual officials to fill the forms out completely, said Goldsmith.

“Because the board has no idea what the holdings are of any public official, we don’t look at them to see if there’s something because we have no way of knowing if something is missing.” Goldsmith said.  “The only things we would see are cases of over-disclosure, not under-disclosure.”

The outdated language of the economic disclosure has failed to keep pace with modern business practices, said Marty.

“The biggest loophole is, if I do independent contracting, it doesn’t show up anywhere,” Marty said. “Any group that wants to buy influence with me, they can’t give me a gift, but they can hire me as a consultant, pay me thousands of bucks a year and frankly ask me to do nothing.”

In addition to the loopholes provided by the broad language of the statutes, the ethics agency, the Campaign Finance and Public Disclosure Board, is “exceedingly weak” in investigatory and enforcement powers, Schultz said.

“Disclosure actually requires somebody that’s in the position of enforcing the law and monitoring the conflicts of interests,” Schultz said. “Our public officials practically break their arms patting themselves on the back, saying that we’ve got all these fine laws, but in fact the laws really are quite weak compared to contemporary standards.”

The potential for reform

Despite the fact that Minnesota has fallen to 40th in the nation in terms of rigorous disclosure laws, according to a recent ranking by the Center for Public Integrity, there’s been little appetite from state lawmakers to engage in ethics reform.

As early as 1975 and 1979, the disclosure board asked in its annual reports that the legislature clarify and strengthen the conflict of interest statute and outline the potential sanctions of failing to file a disclosure, although the conflict of interest portion of the statute has only been broadened.

Ethics reform often evokes anger from legislators who think any reforms allude to their corruption, Marty said.

“Conflicts of interest corrupt the process,” Marty said. “It doesn’t require corrupt people; it’s a corrupt process.”

Efforts to reform disclosure laws also face the wrath of powerful private interests that are the laws’ targets, as well as some lawmakers.

“[Reforms are opposed] by people who get things like that and don’t want to stop getting them; and people who give things, because they get influence, don’t want to lose their influence,” Marty said. “Our laws could be a lot stronger and unfortunately people who either don’t get it it or are taking advantage of the weak laws don’t want to change them.”

The danger of weak conflicts-of-interest laws, especially in a citizen legislature where legislators are often dependent on outside employment, is that the public’s interest won’t be represented, Marty said.

“The whole point of these laws is not that people have to go through a bunch of paperwork,” Marty said. ”If I’m taking money from somebody, I think the public has the right to know whether I’m serving the public or serving some other interest.”