making local government more ethical
A Hartford Courant editorial on Friday asked a question that is not asked enough, Why delay an ethics investigation until a criminal investigation is complete? Another such question that is not asked enough is, Why delay an ethics proceeding until a criminal proceeding is complete?

The editorial takes the position that an ethics investigation should go forward, despite the fact that a criminal investigation is ongoing. It makes some good points, which I have put in my own words below and, in some cases, added to:

Party Committee Members on EC
According to an article in the Hartford Courant this week, a Newington, CT mayoral candidate, and council minority leader, who has made ethics allegations against the incumbent mayor has chosen not to file an ethics complaint because, she says, two of the four members of the town's ethics board are also members of the opposing party's town committee, one of them the nominating chair of the committee.

This is a problem with many ethics commissions that are selected by high-level officials and have few if any limitations on who can be a member. Officials and party committee members on an ethics commission cannot be seen as being neutral with respect to the officials, especially elected officials, who come before them.

It all started with the indictment, on charges of bribery and theft, of a Fats, Oil & Grease inspector back in November 2010. It led to an 83-page grand jury report in August 2013, which set out the misconduct involving the DeKalb County (GA) Department of Watershed Management (DWM) procurement process, and made recommendations not only for indictments, but also for an improved ethics program. The story that the grand jury tells in its report is a classic case of institutional corruption in a procurement context, relating to a division of the Public Works department and a large construction project. Just about every procurement-related ethics violation occurred, and many people were involved or knew what was going on.

There is usually another side of the coin, and that other side is often ignored in drafting a government ethics code. The other side of the nepotism coin came up recently in an ethics proceeding in Stamford, CT.

According to an article this week in the Stamford Advocate, a former finance board member filed an ethics complaint against a former colleague, who still sits on the finance board, for intervening to help a cousin, and member of her household (which in Stamford is considered "immediate family"), who is a city employee.

One piece of evidence provided by the complainant is that the respondent e-mailed the mayor after learning that the complainant, then a finance board member, was seeking to reorganize the department where the respondent's cousin worked, which might have meant the cousin losing her job. The e-mail included the following:
"It was like dandelions. You just accept them. They were there, something you've seen all your life."

Dandelions are a perfect metaphor for institutional corruption. In this case, the dandelions were extra payments (beyond those due to retirees) made by Detroit's two pension funds, to active employees (54%), retirees (14%), and the city itself (32%), the latter to lower annual contributions to the funds, according to a front-page article in today's New York Times. The extra payments totaled almost $2 billion over 23 years. The quote is from Detroit's former independent auditor general, Joseph Harris.

Why would pension boards hand out payments to active employees? May it have had something to do with the fact that the boards were controlled by government employee unions? Back in 2008, I wrote a blog post which dealt with this issue. The post talks about whose property a pension fund is:  that of the employees who will be paid from it or of the citizens whose money is being spent? In good times and when pension board trustees are acting responsibly, the citizens have little to lose. But in bad times and when pension board trustees are acting irresponsibly, not only is the citizens' money wasted, but they may find themselves paying extra money of their own.

Yesterday, a felony complaint was issued against William Rapfogel, the CEO of the Metropolitan Council on Jewish Poverty, a large nonprofit social service agency that received millions of dollars in grants and contracts from New York City, New York state, and the federal government. One of the charges is that the nonprofit made large campaign contributions to city and state candidates through its insurance company (and the company's officers and employees), using money from overcharges on insurance policies (part of this money also went, as kickbacks, to Rapfogel and others).

In New York State, nonprofits are not permitted to make campaign contributions. Nor is it legal for an individual or corporation to make campaign contributions through someone else (known as a "straw donor").

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