Kander releases information on proposed ethics legislation

With the recent arrests and guilty pleas to felonies by Rep. Steve Brown, D-St. Louis; Rep. Talibdin El-Amin- D. St. Louis; and Sen. Jeff Smith, D-St. Louis, as well as major revelations in a series of Kansas City Star articles today about the influence of money on legislation, Rep. Jason Kander, D-Kansas City, released copies of a letter and a memorandum he sent to his fellow House members Sept. 9 outlining proposed ethics legislation for 2010. The letter and memorandum are printed below:

Dear fellow legislators,

Since taking my seat in the House of Representatives earlier this year, I have had numerous conversations with many of you about the need for sweeping ethics reform in our state. Far too often, these conversations end with regretful resignation to the belief that nothing is likely to change despite the glaring problems that exist.

The purpose of this letter is to articulate some of the most basic problems, the remedies I believe are necessary, and the statutory changes I intend to propose next session in the form of multiple bills. I know what an incredibly difficult task it will be to pass major ethics reform. That’s why I’m starting this conversation four months before the session begins. I want the opportunity to incorporate your input before these bills are pre-filed in December.

I also intend to highlight a few legislative proposals from last year that I think deserve a fresh look this year.

Ethics violations occur on both sides of the political aisle. It is my sincere hope that these pieces of legislation will have bipartisan support in 2010.

Please contact my office to indicate your interest in co-sponsoring any of the new pieces of legislation next session. Contact the past sponsor to co-sponsor good bills I’m highlighting from last session.

Most importantly, please let us know what changes you would suggest. I don’t promise that the final bills will include every suggestion, but I will certainly do my best to introduce legislation that includes bipartisan input, so long as that doesn’t require sacrificing the prevailing mission of real reform.

Thanks for your consideration. The attached document lists our greatest problems, my proposed solutions (and previous proposals by others), and the language I’d like to see in our state’s statutes.

I look forward to hearing from you.

Sincerely,
Jason

#1
Problem: Money Laundering
Unfortunately, it has become common practice by many Missouri politicians to shuffle funds from one committee to another in order to “wash” contributions and mask their source. This risks the possibility of legislators engaging in “pay to play” schemes without the risk of detection because funds can enter the system in one committee and then travel through several others over a period of months before finally reaching the legislator in question. Our completely unregulated committee system serves little purpose other than to aid those who engage in the laundering of political money.

Solution: Common sense committee reforms

Because political money is typically “washed” through a variety of committees before finding its way into a candidate or party committee, my initial instinct was to eliminate several of the committee designations that exist now (continuing, legislative district, etc.).

My research indicates that doing so would present a first amendment problem. Therefore, we must settle for regulating the existing system.

I propose that we allow only candidate committees to receive donations from other committees. If non-candidate committees are not allowed to donate to one another, the current methods for laundering political money will be impossible without directly implicating a candidate’s campaign committee.

Statutory language to be added to RSMo 130.031

“No committee shall transfer funds to any other committee with the sole exception that a candidate committee may transfer funds to another candidate committee. Whoever attempts to transfer funds from one committee to another for the overriding purpose of concealing or masking the origin of a political contribution shall be guilty of a class D felony.”

#2
Problem: Donor Anonymity
Currently, the Missouri Ethics Commission (MEC) website only allows users to search for contributors to candidate committees. Therefore, a contributor who has received unlawful favors from a legislator but does not want to be known as a contributor to that legislator or a tangentially related committee can rest assured that only extreme due diligence will reveal their contribution. This severely limits transparency and is partly due, by design I suspect, to the lack of a requirement for electronic filing by noncandidate committees.

Solution: Bring continuing committees into the light of day

If candidate committees can be expected to file online disclosures, it is not overly burdensome to expect the same of other committees. The law must be amended to require all committees to file electronically. Additionally, the MEC should be instructed to make all itemized contributions – regardless of committee type – searchable on the MEC
website.

Statutory language to be added to RSMo 130.057

“8. All committees required to file disclosure reports with the Missouri Ethics Commission must do so in electronic format as prescribed by the Commission. The Commission shall make all contributions to any committee registered with the
Commission available in an easily accessible electronic format to the general public in accordance with the requirements for public officials in section 5 above.”

#3
Problem: Pay to Play

Current law does prohibit the exchange of value for official acts. However, a more clearly articulated, broader statute would allow more frequent prosecutions of “pay to play” activities by legislators and deter legislative extortion. It is questionable whether the current law would specifically encompass the giving of campaign contributions, for instance.

Solution: End legislative extortion

We need a new provision specifically aimed at “pay to play” schemes and including more than just the passage of law, but also any promises not to advance or hinder certain legislation. In 2005, Rep. Rachel Storch introduced language concerning bribery, but the bill did not receive a hearing. That language was a definite step in the right direction as it expanded the application of bribery, but it is time for us to go even further and write a law that encompasses the way in which “pay to play” transactions are most likely to proceed.

We can continue to sit around and hope that federal agents from the Western District will make Jefferson City corruption a priority, or we can create an actionable “pay to play” provision in Missouri law and allow the outstanding law enforcement professionals at the state level to make a contribution toward clean government, as well.
Statutory language to be added to RSMo Ch. 105

“Section 1. Whoever offers anything of value – including, but not limited to, political contributions – in consideration for the act of passing state or local legislation or a state administrative regulation or whoever offers anything of value in consideration for failing to pass or hindering the passage of state or local legislation or a state administrative regulation shall be guilty of a class D felony.

(A) Violations of the above section would include, but are not limited to, accepting anything of value as consideration for a promise to: advocate for or against a piece of legislation, assign legislation to a specific committee, delay the referral
of legislation to a committee, or in any way affect the legislative schedule to hinder or benefit specific legislation.”

#4
Problem: Rampant conflicts of interest

There have been several instances of legislators and members of their staff conductingpaid political work for members or potential members of the General Assembly. The conflict of interest is obvious. For instance, if a staffer or member responsible for the assignment of bills to a particular committee receives compensation for work as a political consultant to a bill’s sponsor, there is either impropriety or the appearance of impropriety when the staffer or member’s office gives favorable treatment to such a member’s legislation. It is unfortunate that such conflicts have only been unearthed in the
past by investigative journalists. The public should have the opportunity to find such conflicts themselves.

Solution: A mix of prohibition and increased accountability

To deal with the problem of staff conflicts, I propose that we increase the number of positions that require personal financial disclosures (PFD). Current law requires that certain positions, such as General Counsel, file PFDs, but there is some debate about whether or not that applies to part-time or contracted employees acting in such roles. I will file legislation to end that debate.

Additionally, I propose that any staffer who also works as a paid political aide of any kind be required to file a personal financial disclosure.

Rep. Paul Quinn proposed legislation last year that prohibited members of the General Assembly from acting as political consultants for one another. I hope that more members will co-sponsor Rep. Quinn’s bill this year and that the Speaker will refer it to committee.

Furthermore, former Rep. Harris at one point proposed language that would have required all staffers to House and Senate leaders to file PFDs. I believe this to be a common sense idea, as well.

Statutory language to be added to RSMo 130

“1. Staff member - an individual employed by the state of Missouri or any public official of the state of Missouri.
2. Staff members receiving compensation for political activities or consulting not directly associated with their official positions, shall be required to file a personal financial disclosure report with the ethics commission. The ethics commission
shall determine the content of the report to be filed and establish reasonable deadlines for filing. Both the content and the deadlines shall be substantially similar to the personal financial disclosures required of public officials.”

Statutory language to be added to RSMo 105.483

“(12) This section shall apply to all persons in the roles or positions set forth previously, to include those compensated on a full-time, part-time, or contract basis.”

#5
Problem: Political Consultant Tax Evasion

According to reporting by the Springfield News-Leader, there have been instances in Missouri where political consultants have used campaign committees to finance the operations of a private business. This was a foreseeable problem, given the sometimes blurred lines between political business and political campaigning.

Solution: Outlaw it

It is important that this be addressed directly in statute in such a way that creates a manner in which to prosecute an obvious federal violation at the state level – should the federal government fail to move. Already powerful political consultants in Missouri can only consolidate power if they are allowed to operate their businesses beyond the reach of state or federal taxes.

Statutory language to be added to RSMo Ch. 130

“Notwithstanding any other provision of law, no committee funds shall be used for the payment of the private business expenses of any person or other entity unless specifically allowed by law. The violation of this section is a class D felony.”

#6
Problem: De-facto lobbyists

An individual who serves as a political consultant to multiple members of the legislature, but also does consulting work for private entities with business before the legislature, is able to lobby on behalf of corporate clients without the traditional lobbyist regulations.

This is more than just unfair competition in the lobbying community; it is a dangerously unregulated way for corporate actors to gain significant influence within the Capitol.

Solution: Registration

These non-lobbyist lobbyists must be brought into the light of day. For instance, a consultant could work for members of both chambers and do grassroots public relations work against a specific piece of legislation (on behalf of a corporate client) at the same time. The expectation that the corporate client would not ask the consultant to speak to his clients about the issue or that the consultant would not have already done so is naïve.

The solution is to create a “de-facto lobbyist” category and require registration. It could be included in the current lobbyist definitions in RSMo 105

Statutory language to be added to RSMo 105.470

“De-Facto Lobbyist – Any individual who works as a political consultant or public relations consultant for a member of the legislative or executive branch and for any other entity doing business in the state of Missouri whether or not such individual expends funds or other items of value to influence or attempt to influence an election, the passage of a law or regulation, or a ballot measure.”

#7
Problem: Obstruction of Investigations

With few resources at their disposal, the Missouri Ethics Commission is heavily reliant upon elected officials and political activists to offer honest information. Due to the lack of likely follow-up work in the limited investigations that take place, it is difficult to assess who is telling the truth. Obstructing an MEC investigation should carry a heavy penalty – one significant enough to deter obstruction. There are some who believe that the federal system that harshly punishes obstruction is unfair, because it allows prosecutors to get convictions when there is not enough evidence to charge theunderlying acts. This is a wrong-headed philosophy.

When Patrick Fitzgerald indicted Scooter Libby for obstruction, he faced this criticism and offered an analogy that explained the obstruction statute perfectly: “If you saw a baseball game and you saw a pitcher wind up and throw a fastball and hit a batter right smack in the head, and it really, really hurt them, you’d want to know why the pitcher did that. What we have when someone charges obstruction of justice, the umpire gets sand thrown in his eyes. He’s trying to figure what happened and somebody blocked their view.”

Solution: Model the federal approach

The fact is, we have a recent example in Missouri politics where lying didn’t pay because the system worked. Not the Missouri system, but the federal system. It’s important for us to have a statute that significantly deters Missouri’s politicians from throwing sand in the umpire’s face.

Statutory language to be added as RSMo 575.01

“Section 1. 1. A person commits the crime of obstruction of an ethics investigation if:

(1) He or she confers or agrees to confer anything of pecuniary benefit to any person in consideration of that person’s concealing or withholding information concerning an ethics violation under the jurisdiction of the Missouri Ethics Commission or a violation of any election law; or

(2) He or she agrees to accept anything of pecuniary benefit in consideration for concealing or withholding information concerning an ethics violation under the jurisdiction of the Missouri Ethics Commission or a violation of any election law; or

(3) He or she for the purpose of obstructing or preventing an ethics investigation:

(a) Utters or submits a false statement that he or she does not believe to be true to a member or employee of the Missouri Ethics Commission or to any official investigating the violation of an election law; or

(b) Submits any writing or other documentation to the Commission, its investigators, or any other official agent of the state acting under ethics, election, or campaign laws that is not accurate and that he or she does not believe to be true.

2. 1. It is a defense to subdivision 3 of subsection 1 of this section that the false statement or writing or other documentation was retracted, but this defense shall not apply if the retraction was made after:

(1) The falsity of the statement or documentation was exposed; or

(2) The member or employee of the Missouri Ethics Commission or an official investigating a violation of election law took substantial action in reliance upon the statement or documentation.

2. The defendant shall have the burden of injecting the issue of retraction pursuant to this subsection.

3. Obstructing justice pursuant to this section is a class D felony.”

#8
Problem: Political Machines

The political machines of today take a different form than those of the Pendergast area. Today, they are centered on political consultants as often as special interests. Our system enables this process, in part, because a single individual can serve as treasurer of multiple committees. While not everyone that controls multiple committees does so for a dishonest purpose, there are far too many “bag men” able to donate funds from several different sources (and, in the absence of money laundering reforms, directly to their own committees). This allows a single person to further a conspiracy to conceal the origin of funds with almost no help from others, making it nearly impossible to prevent.

Solution: End the slight of hand

Why is it necessary that a single individual act as treasurer of multiple committees? It is not. We can put a few “bag men” out of business. Former Rep. Jeff Harris first proposed this in 2005 and I have built upon the language he proposed at that time.

Statutory language to be added to RSMo 130.021

“Notwithstanding any other provision of law, an individual is prohibited from serving as the treasurer or deputy treasurer of more than one committee at any time. Violation of this provision is grounds for such individual’s removal via a writ of quo warrant issued by any court of competent jurisdiction or upon the unilateral action of the Missouri Ethics Commission.”

PAST PROPOSALS DESERVING OF YOUR CONSIDERATION

#1
Problem: Lobbyist Gifts

There’s not much to say here. There’s just no reason this bill shouldn’t finally move forward. Why is it so important that elected officials have the chance to get free tickets and free dinners in order to learn more about a particular issue? Constituents who do not have the money to entertain their representative for two hours shouldn’t have less opportunity to persuade them as a result.

Solution: End it.

The single sentence solution in Rep. Brian Yates’s proposal from last year says it all. We should all join Rep. Yates in co-sponsoring this bill when he proposes it again this year.

Statutory language to be added to RSMo 105.456
“No member of the general assembly shall accept any tangible or intangible item, service,or thing of value from any lobbyist, as defined in section 105.470.”

#2
Problem: The no-limit world

Missouri once led the way toward campaign finance reform, making it all the more disappointing that we are one of the few states with no contribution limits at all. In 1994, Missourians overwhelmingly supported a ballot measure that implemented campaign contribution limits and, in 1999, in Nixon v. Shrink, then Attorney General Nixon successfully defended the law before the U.S. Supreme Court. We have a proud history of responsible campaign reform, but today a single special interest can dwarf the influence of the average voter because they have the means to exclusively bankroll a candidate’s campaign.

Solution: Restore the limits

Last session, I co-sponsored Rep. Paul Levota’s bill to restore campaign limits and I propose that we finally take that action this year.

Statutory language to be added as RSMo 130.032

“130.032. 1. In addition to the limitations imposed under section 130.031, the amount of contributions made by or accepted from any person other than the candidate in any one election shall not exceed the following:

(1) To elect an individual to the office of governor, lieutenant governor, secretary of state, state treasurer, state auditor, or attorney general, one thousand two hundred seventy-five dollars;

(2) To elect an individual to the office of state senator, six hundred fifty dollars;

(3) To elect an individual to the office of state representative, five hundred dollars;

(4) To elect an individual to any other office, including judicial office, if the population of the electoral district, ward, or other unit according to the latest decennial census is under one hundred thousand, three hundred twenty-five dollars;

(5) To elect an individual to any other office, including judicial office, if the population of the electoral district, ward, or other unit according to the latest decennial census is at least one hundred thousand but less than two hundred fifty thousand, six hundred fifty dollars; and

(6) To elect an individual to any other office, including judicial office, if the population of the electoral district, ward, or other unit according to the latest decennial census is at least two hundred fifty thousand, one thousand two hundred seventy-five dollars.

2. For purposes of this subsection, "base year amount" shall be the contribution limits prescribed in this section on January 1, 2010. Such limits shall be increased on the first day of January in each even-numbered year by multiplying the base year amount by the cumulative consumer price index, as defined in section 104.010, RSMo, and rounded to the nearest twenty-five-dollar amount, for all years since January 1, 2010.

3. Every committee established under this chapter shall be subject to the limits prescribed in subsection 1 of this section. The provisions of this subsection shall not limit the amount of contributions that may be accumulated by a candidate committee and used for expenditures to further the nomination or election of the candidate who controls such
candidate committee.

4. Except as limited by this subsection, the amount of cash contributions, and a separate amount for the amount of in-kind contributions, made by or accepted from a political party committee in any one election shall not exceed the following:

(1) To elect an individual to the office of governor, lieutenant governor, secretary of state, state treasurer, state auditor or attorney general, two thousand dollars;

(2) To elect an individual to the office of state senator, one thousand dollars;

(3) To elect an individual to the office of state representative, five hundred dollars; and

(4) To elect an individual to any other office of an electoral district, ward, or unit, ten times the allowable contribution limit for the office sought.

5. The amount of contributions that may be made by or accepted from a political party committee in the primary election to elect any candidate who is unopposed in such primary shall be fifty percent of the amount of the allowable contributions as determined in this subsection.

6. Contributions received and expenditures made before August 28, 2010, shall be reported as a separate account and under the laws in effect at the time such contributions are received or expenditures made. Contributions received and expenditures made after August 28, 2010, shall be reported under the provisions of this chapter as a separate account from the other separate account described in this subsection. The account reported under the prior law shall be retained as a separate account and any remaining funds in such account may be used under this chapter.

7. Any committee that accepts or gives contributions other than those allowed shall be subject to a surcharge of one thousand dollars plus an amount equal to the contribution per nonallowable contribution, to be paid to the ethics commission and which shall be transferred to the director of revenue, upon notification of such nonallowable contribution by the ethics commission, and after the candidate has had ten business days after receipt of notice to return the contribution to the contributor. The candidate and the candidate committee treasurer or deputy treasurer owing a surcharge shall be personally liable for the payment of the surcharge or may pay such surcharge only from campaign funds existing on the date of the receipt of notice. Such surcharge shall constitute a debt to the state enforceable under, but not limited to, the provisions of chapter 143, RSMo.

#3
Problem: Lawmaking in the shadows

The sunshine law in Missouri is one of the best mechanisms to ensure honest, transparent government and hold accountable those who misuse power. Under current law, individual members of the Missouri General Assembly are exempt from the sunshine law. If members are violating even existing ethics laws, it’s almost impossible to prove it without the use of a subpoena.

Solution: Legislative sunshine

Last year, Rep. Jake Zimmerman proposed an easy fix to this problem. I’m happy to say that Rep. Tilley and Rep. Schoeller were among the co-sponsors. Rep. Zimmerman’s bill would have applied the sunshine law to all government officials – including members of the General Assembly. My hope is that Rep. Tilley will impress upon the speaker the importance of actually referring Rep. Zimmerman’s bill to committee this session. When Rep. Zimmerman offered it as an amendment to another open records bill last session, it failed by a single vote.

Statutory language to be added as RSMo 610.010(4)a

Application of the open records law to: “Any public official, statewide elected official, or employee of the state and its agencies when such persons are operating in their official capacities and using state-funded equipment for their official communications;”