making local government more ethical
The arrest of New York state senate majority leader Sheldon Silver points to an ongoing institutional problem that is not limited to New York state:  the law firm as the perfect place to launder money. The reason for this is that lawyer-client confidentiality, at least as it is often practiced, allows a law firm, and the public office holders who are part of or do work for it, to keep its clients, its services, its receipts, and its payments secret.

According to the complaint, dated January 21, Silver has been accused of using his position to give himself millions of dollars in kickbacks and bribes, most of which went through two law firms with which he is affiliated. What were called "attorney referral fees" came from clients with substantial business before the state and, according to the complaint, "not as a result of legitimate outside income Silver earned as a private lawyer." Even legitimate and semi-legitimate outside income earned from those seeking special benefits from the government can be problematic.

Call for a State Municipal Lobbying Code
It may be a big holiday week and the end of the year, but there has still been some news on the government ethics front. The Boston Globe has called for the state to institute disclosure requirements for local lobbying. According to the editorial, the only rule now is to file a letter with the Boston city clerk when lobbying the Boston city council. One letter about whom is represented and what the nature of the business is. You can lobby the Boston mayor and any board or agency without notice, not to mention the other cities and counties in the state. That doesn't cut it, at least according to the Globe editorial board.

There is a lot of disagreement over whether contingency fee arrangements between client and lobbyist should be permitted. Many cities, counties, and states prohibit arrangements where lobbyists are paid only if they succeed. The principal reason is that this arrangement encourages ethical misconduct. It encourages lobbyists to do everything they can to win, which may be good in a private adversary suit, but is not appropriate in a public context, where winning involves changes in public policy or obtaining public contracts, grants, or permits.

Historically, courts have seen contingency fee arrangements relating to government action as leading to corruption and harmful to the public's trust in its government. But lawyers have argued that it works well for them, and allows more people to hire lobbyists (although there is no evidence that this actually occurs).

An investigative piece in the New York Times last week shows what can happen when lawyers being paid via contingency fee arrangements lobby state attorneys general. What the lawyers are lobbying for is to have AGs bring suits that will help their clients, and them, win their cases. These lawyers are acting as procurement lobbyists, for themselves and their clients.

ALEC has gone local. No, not Alec Baldwin. ALEC is the American Legislative Exchange Council, an organization that for the last few years has been drafting conservative legislation for state legislatures. According to an article in today's New York Times, this year ALEC started a new program called the American City County Exchange, which will draft conservative legislation for local legislatures.

Its first area of focus is right-to-work laws, the term for laws that prohibit labor unions from requiring their members to pay fees. The members still get the value of the union's work, but don't have to pay for it. This leaves the union with less resources to get politically involved. The goal of these laws is changing the balance of political competition.

The issue I want to raise involves local lobbying. When organizations such as ALEC try to get county officials to pass their laws, they do not have to disclose their lobbying, because very few counties have lobbying oversight programs. Thus, according to the article, when an ALEC ordinance came before the Warren County, Kentucky Fiscal Court (effectively, the county commission) last week, it came completely out of the blue, with no disclosure of lobbying or even of the topic of the ordinance.

When it comes to local lobbying oversight, cities are falling like flies. At least in Canada.

According to an article yesterday on the Vancouver, BC Metro News website, the city council voted unanimously to look into establishing a lobbying registry and hiring an independent ombuds, apparently to run the registry and more. This follows the vote to establish a lobbying registry in Hamilton, and the establishment of lobbying registries in Toronto and Ottawa.

I wish the news were as good in the U.S. Here the best news is that the chapter of my book Local Government Ethics Programs on lobbying (along with a Model Lobbying Code) should be done and online by the end of January, if all goes well.

It amazes me how many ways elected officials misuse charitable organizations to engage in ethical misconduct, especially to get around gift rules. One would think that charities would be sufficiently sacrosanct. But instead they are frequently used as an indirect form of pay to play, and they have played a major role in getting around campaign finance limitations.

The form of misuse of charitable organizations that this post will look at involves a company that wants to get around restrictions on corporate campaign contributions. It is not enough that the company's employees are allowed to give to a corporate SSF (separately segregated fund, essentially a corporate PAC). The company decided to induce such gifts by double "matching" them with its own gifts to a charitable organization that does only one thing:  help out its employees when they are in need.

The company is Wal-Mart, the charity is Wal-Mart Associates in Critical Need Fund, and the matter that has arisen is a complaint filed with the Federal Election Commission (FEC) by Public Citizen and Common Cause. The most amazing fact stated in the complaint is that the FEC has already issued twelve opinions on this very topic, allowing almost all of the situations on the grounds that there was not "an exchange of corporate treasury funds for voluntary contributions and a form of indirect compensation for the contributor's contribution."