Lawmakers use public office to help private interests - State's rules on conflicts of interest fuzzy at best
OLYMPIA, WA-- Last spring, an energy company executive from Chehalis secured a tax exemption for his boss.
And a central Washington pharmacist whose family owned more than $200,000 in drug company stock killed a measure to establish the nation's most ambitious prescription discount program.
Each is a member of an army of special-interest advocates in Olympia with more access to -- and influence over -- the Legislature than any lobbyist.
They are the legislators themselves.
During the 2003 legislative session, despite a historic, $2.7 billion state budget shortfall, dozens of lawmakers found the time and political will to exempt themselves from tax burdens others must shoulder, and relieve themselves of regulations others must meet.
A Seattle Post-Intelligencer analysis of the session, which adjourned in June, found:
From the banal to the brazen, Washington's part-time lawmakers help their friends, families and bosses -- and they help themselves.
And it's all legal. Indeed, it's encouraged in Washington's part-time Legislature, which convenes for the 2004 session on Monday. After all, who better to appreciate the need for agricultural tax breaks than farmers? Who is more qualified to set health policy than nurses?
Sometimes that coziness benefits private industries. Sometimes it grants special legislative favor to state agencies and local governments. And taxpayers rarely know the extent to which politicians' personal financial motivations and public powers overlap.
"People should be aware of it. Lawmakers -- maybe more than anyone -- hold our lives in their hands," said Leah Rush, director of state projects for the Center for Public Integrity, a watchdog group. "I don't think that every legislator is exploiting their public office for private gain.
"But there's definitely the possibility for that to happen in every state."
More than 100 of Washington's 147 legislators spend most of the year in their other jobs, answering to bottom lines and bosses other than their constituents. And as "citizen-legislators," lawmakers enjoy broad exception from the State Ethics Act, which regulates about 100,000 state workers and officials.
So, where is the line?
According to the Legislative Ethics Board, there's barely a line at all.
A conflict of interest doesn't exist unless a lawmaker lobbies, sells his legislative counsel or enjoys exclusive benefits from legislation "to a greater extent than any other member of such business, profession, occupation or group," the board has said.
That means a retired teacher, Vancouver Republican Sen. Don Carlson, was well within the law when he proposed that the state give pensioners like himself a cut of the profits from state retirement fund investments. After all, the senator wasn't the only retired teacher who stood to gain.
As presumptive experts in their fields, lawmakers are also encouraged to sit on legislative committees that regulate their industries. In fact, many legislative committees are chaired by people with relevant personal financial interests. That means those insiders control the agendas of committees that regulate their own industries.
And it's not easy to avoid an awkward vote. Legislative rules require lawmakers to vote on measures before them, unless they're explicitly excused.
For example, Rep. Jeff Morris, D-Anacortes, said he once tried to excuse himself from voting on a bill he felt could benefit the work of his then-wife.
"Everybody on the committee just completely wigged out," he said. Their point was, "once you start excusing people because of their connections, you're not going to have anyone around for a quorum."
Lawmakers and ethicists largely support some private/public overlap -- and they agree that voters prefer that to "professional politicians" who meet year-round.
"We have a great mix of people who collectively have an expertise on all of the doings of the state," said Sen. Pam Roach, R-Auburn.
Still, some Washington lawmakers worry that their colleagues have crossed ethical lines. For example, many balked at a perennial proposal to help a handful of elected officials collect pensions while still in office.
And yet, legislators gauged their own behavior against the state's relatively loose legal thresholds -- even as they acknowledged that the public has a weaker stomach for such overlap.
When legislators last year considered a proposal to restrict electronic junk-mail messages to cell phones and pagers, Microsoft Corp. didn't show up to testify. The company had a stake in getting the measure passed. They hoped it would curtail spam from souring the mobile message market, said Rep. Toby Nixon, R-Kirkland.
But Microsoft didn't bother with the public hearing.
Nixon, the bill's sponsor, works for Microsoft. And his boss had plenty of influence on the measure. "Microsoft was very active in helping to craft that legislation," he said.
This is often how things work in Olympia.
Sometimes, private industries get special access through legislators they employ. Other times, lawmakers push through bills to help their own industries generally. And sometimes, legislators approve bills that benefit their own investment portfolios.
To be sure, this is essentially how things are supposed to work in Olympia, under the citizen legislature principle.
Under that structure, one might expect union-friendly proposals from two Democratic lawmakers (Rep. Steve Conway and Sen. Karen Keiser) who work for labor organizations. And the two delivered them last year.
It's also hardly surprising that about a dozen legislators who are farmers supported proposals opening the door for tax breaks for agricultural equipment.
Nor that a Puyallup nurse, Rep. Dawn Morrell, sponsored a bill to improve working conditions for her fellow nurses, and a Normandy Park physician proposed shields for doctors from malpractice lawsuits.
"All of us have special interests," said the doctor, Rep. Shay Schual-Berke. "It is impossible to be a citizen Legislature -- participating in your community and make your living anywhere -- and not vote on things that affect you in some way."
And most lawmakers brag about their efforts to help the huge engines of the Northwest economy such as Microsoft and The Boeing Co. That includes a number of lawmakers who own shares in the two companies.
Nixon, the Microsoft program manager, insisted that it is acceptable to let his employer guide his public work. "There's 146 legislators that are going to make sure nothing untoward happens."
Legislators often say that what's best for their bosses is best for their districts. Consider Rep. Richard DeBolt, R-Chehalis. The House Republican leader also serves as "external relations" officer for the TransAlta energy company.
Last year, DeBolt co-sponsored a bill that made small changes to an assortment of tax breaks, aiming to clarify previous legislation. The broadly supported package included a tax break for the Centralia Steam Plant, owned by TransAlta.
"It was more technical corrections," to avoid violating interstate commerce laws than it was a new tax exemption, said DeBolt, who said he had helped push through the original tax break. TransAlta employs 835 in his district, DeBolt said, and the bill "ties (TransAlta) down" to buying coal from the local mine.
A TransAlta spokesman recently told the P-I that DeBolt serves as a liaison for the Canadian company in dealings with local governments, business and community groups, and Washington agencies and legislators.
But DeBolt insists he's not a de facto lobbyist. Although he sometimes represents the company before state regulators, DeBolt said he does not lobby fellow legislators on its behalf.
Legislative lawyers signed off when DeBolt took the TransAlta job because it's not a conflict in the eyes of the law, said DeBolt, who sits on the House Energy Committee.
Similarly, lawmakers are given broad latitude for their stock holdings.
The Legislative Ethics Board has repeatedly indicated that a lawmaker must own a "controlling" share or have a substantial management responsibility over a company before it represents a potential conflict.
Federal law is less lax, said Larry Noble, director of the Center for Responsive Politics in Washington, D.C.
"The true question of a conflict isn't that you can control the company," Noble said. "The true question is whether or not you are torn because your financial interests will be affected. ... People recognize that we are human and there are natural instincts in those situations."
Here in Washington, a number of lawmakers influenced bills that benefited their portfolios last year. For example, a House member with stocks in the semiconductor industry, Rep. Phil Rockefeller, D-Bainbridge Island, co-sponsored tax breaks for that industry. A representative with thousands of dollars in cell phone company stock (Rep. Helen Sommers, D-Seattle) supported measures benefiting cell phone companies.
And Republican Sen. Linda Evans Parlette, a Wenatchee pharmacist, helped kill several measures that drug companies bitterly opposed. For example, she blocked bills that would have established a state bulk-buying club, which would have forced the pharmaceutical manufacturers to accept lower prices.
Parlette's 2003 public disclosure filings with the state indicate her family owned at least $200,000 in stocks in drug and biotechnology companies, although she said those figures are outdated and inflated. Parlette said she never considered her own stock in those votes, but it wouldn't have swayed her decision. And her votes appear to easily comply with the state's legislative ethics standards.
Even the sponsor of the drug bills Parlette killed said the senator's financial interest falls short of a conflict.
"(She's) not the only one benefiting -- that's the real test," said Seattle Democratic Rep. Eileen Cody. "It really is the strength of the citizen Legislature that people are real people. Real people are messy, but that's just the way it is."
It can get even messier when Washington lawmakers ally with a second governmental master -- a coziness some states prohibit.
Four years ago, Tulalip Tribes' lobbyist John McCoy began pitching a controversial proposal to enable the Tulalips to collect their own sales taxes at Quil Ceda Village, a busy shopping center off Interstate 5 near Marysville that McCoy manages.
"I keep trying," McCoy said.
But these days, McCoy lobbies lawmakers from the inside. As well as a Tulalip official and government affairs adviser, McCoy is now a Democratic legislator and member of the House Commerce Committee.
Unlike some states, Washington allows legislators to hold second jobs in state or local governments. Many ethicists and political watchdogs say lawmakers can't fairly balance the needs of two sets of constituents.
"They should be serving one governmental body, not two," said Robert Stern, president of the Center for Governmental Studies in Los Angeles, a non-partisan research organization. Stern helped draft California's ethics laws 30 years ago. "You can't have two masters."
But McCoy said Washington legislative ethics lawyers told him it was OK for him to pursue the bill that could also eventually affect other tribes, which are sovereign governments.
Asked if he thought he was violating legislators' prohibition from lobbying, the Democrat said, "Do you know what happens in caucus? We lobby each other. We just lobby the hell out of one another."
McCoy is among a dozen lawmakers who pulled such governmental double duty over the last year. A number of others held second jobs at state schools.
For example, Sen. Luke Esser, Bellevue Republican, works for King County Councilman Rob McKenna. Esser perfectly meshed with the political motivations of his boss when he sponsored proposals to rein in the controversial Sound Transit light rail agency and make some county auditors elected positions.
"I don't think that anything that I've done wouldn't pass the smell test," Esser said. "Any Republican from East King County could sponsor (those bills) and people would think, 'That makes sense.' "
While other states consider it a conflict of interest, some Washington politicians contend that their legislative work makes them uniquely qualified for jobs in local government.
That's one reason Brian Sullivan recently wound up lobbying himself.
Last fall, things were getting hectic at the Snohomish County executive's office. Executive Bob Drewel needed someone who could step in quickly and serve as a liaison with local and federal governments -- and to help plan the county's annual lobbying breakfast with state legislators.
Drewel didn't even bother with interviews -- he knew Sullivan was the man he wanted for the temporary position. Sullivan has nearly two decades of experience in local politics. Plus, he's in the middle of his second term as a state representative.
"It was just the perfect match," Drewel said. At the county's recent breakfast meeting with the legislative delegation, "He was listening, I think, from the county's position. But he had to, as a representative, make sure that what we were talking about balanced well with his other constituents."
Sullivan, a Democrat from Mukilteo, said he took the job after checking with a House lawyer. He said he didn't see a conflict because he did not plan to work for the county while the Legislature was in session.
And until last summer, Sen. Roach's second job was for a King County councilman. "I served as a bridge between the county and the state but was I a lackey? ... I'm a citizen activist, number one, and I represent the citizens of my district."
Still, some lawmakers with second public jobs acknowledge it can be sticky. Rep. Deb Wallace, D-Vancouver, said one reason she left the state Transportation Department was that she wanted to pursue transportation legislation "from an arm's length away. ... There really is an appearance issue."
Legislators must go on unpaid or vacation leave from their second public positions during the legislative session, said state Trooper and Rep. John Lovick, D-Mill Creek.
Lovick and Republican Rep. Jerome Delvin, a Richland police officer, pushed more than a dozen bills last year that were favorable to police, the brass and police unions. Many are unlikely to raise eyebrows with voters, such as proposals to increase penalties for attacking officers or drunken driving.
Others appear to be catered to the insiders, including a failed proposal to make it harder to take guns away from officers slapped with restraining orders. The State Patrol officially testified in support of a number of Lovick's bills.
But Lovick said he's not concerned that voters will object to him sponsoring legislation sought by his bosses in the Patrol, since the entire state would benefit. After nearly 30 years as a trooper, Lovick said, he offers real-life insight to the criminal justice and judiciary committees. Not surprisingly, he said, police organizations turn to him to shepherd through such bills.
"I would be the natural," he said.
The public hasn't always agreed that's acceptable.
Citizens have repeatedly challenged the propriety of legislators answering to second bosses in government.
The Legislative Ethics Board -- four legislators and five citizens -- usually tosses out those complaints.
One such complaint was filed against Spokane Rep. Jeff Gombosky, a Democrat, in 2000. The complainant alleged Gombosky's temporary 1999 position in Washington State University's public relations department was a conflict of interest. The board disagreed and dismissed the complaint.
By last year, Gombosky had moved onto an adjunct faculty position at Eastern Washington University, where he attended college. And he was among at least five legislators on state college payrolls who backed bills their schools wanted.
Gombosky co-sponsored an Eastern-backed bill to allow more schools to offer electrical engineering degrees. Such support for his bosses is acceptable because it also benefited other schools, he said. Besides, "I wouldn't personally benefit from Eastern offering that particular program."
These days, Gombosky can advocate the interests of his alma matter with abandon.
About one month after the Legislature adjourned in June, Eastern named Gombosky its full-time lobbyist.
Unlike some other states and Congress, Washington allows its lawmakers to resign their legislative positions and immediately become lobbyists, instead of requiring them to wait for a specific period of time.
Government watchdogs acknowledge it's difficult to draw firm lines with citizen Legislatures.
But many say the lawmakers do hold themselves to a higher standard to prevent public distrust.
Sometimes, "even if the rules says it's OK, I would hope that the legislator would say, 'I'm going to be better than the rule,' " said Stern of Center for Governmental Studies. "Now that's hard."
Either way, the public will be the ultimate judge.
It was a citizens' initiative that established Washington's then-precedent-setting conflict-of-interest rules.
And, even as it dismissed a citizens' complaint in 2000, the Legislative Ethics Board acknowledged that perception is paramount.
Even when the letter of the law is met, it wrote, "The public ... will nevertheless be the final arbiters of whether the spirit of the law has also been satisfied."
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