Safra Working Papers

I talk a lot about the importance of independent ethics commissions. But independence is not always a good thing for local government boards and commissions. Independence without oversight, transparency, and independent ethics enforcement easily turns into someone's fiefdom.

Patronage is the most basic of all municipal conflicts of interest. It involves not only self-interest (my job), but also a variety of organizational interests (my agency, party, ethnic or racial group, friends). In every little patronage decision, all of these interests take precedence over the public interest. And yet patronage is also the most commonly practiced, and accepted, of all municipal conflicts of interest. Nowhere has patronage been practiced and accepted more than in Chicago.

Update: September 27, 2011
According to Melissa Griffin's column in the Examiner yesterday, the board of supervisors' Government Audit and Oversight Committee met last week to discuss the civil grand jury report discussed below. The results of the committee consideration of the report are included after each relevant section below.

A report on the relationship between New York's state university system (SUNY) and the SUNY Research Foundation (RF) was published yesterday.

Update: Counsel for the Housing Authority informed me that it was the Authority board, through him, that originally notified HUD of problems, and that another counsel was involved in some of the relevant transactions. Therefore, I have made some changes to the original post.

(Update: March 1, 2010: Also see this excellent Times-Union editorial on the importance of an independent ethics commission that has authority over independent authorities. A particularly valuable observation: "The city Ethics Commission needs the ability to obtain independent legal advice. The city General Counsel's Office advises the mayor, City Council and the Ethics Commission.

I recently discovered that, in May, the Austin's Office of the City Auditor did an extensive report on the city's ethics program, and compared it with 16 comparable American cities (Arlington (TX), Dallas, El Paso, Fort Worth, Houston, San Antonio, Atlanta, Jacksonville, Kansas City (MO or KS?), Memphis, Minneapolis, Oklahoma City, Phoenix, San Diego, San Jose, and Seattle).

Last September, I wrote a blog post about an ethics initiative in Palm Beach County, Florida. A response to numerous scandals, it featured an ethics pledge, primarily for government officials, and a successful attempt to get an independent ethics commission and inspector general for the county government. I felt that the business leaders in Palm Beach County who led the initiative had a good understanding of government ethics, and took a fresh, effective approach.

When city and county contractors and their lobbyists don't follow the rules, it's difficult to catch them, because few cities have an oversight office that investigates on its own initiative. Without such a program, communities depend on federal and state criminal enforcers who focus on bribery and kickbacks.

Sometimes, conflicts are built right into ethics laws, partly because it is in the political interest of those with conflicts, and partly because they don't even view those laws as ethics laws.

Police Officer Side Businesses and Revenue Distinctions
There's an interesting article in yesterday's New Pittsburgh Courier about Pittsburgh police officer side businesses and the sorts of problem they create. One of the problems derives from a false distinction between different sorts of revenue.

Especially in small towns, bankers often have business relationships with many people and, therefore, do not make the best board and commission members on account of the many conflicts they have or, more frequently, the appearance of impropriety.

Here's a situation from Lafayette Parish, a city of 220,000 in south-central Louisiana, which shows how when one official fails to deal responsibly with his conflicts, he is likely to be complicit in helping other officials deal irresponsibly with their conflicts and with those of their colleagues. When this official is a government attorney, it can cause an entire board or agency to deal irresponsibly with a conflict.

Some very interesting issues arise out of a past (and present) conflict situation that has become an issue in this week's mayoral primary in the Unified Government of Wyandotte County and Kansas City, KS ("UG").

The new mayor of Indianapolis, Greg Ballard, who ran as a candidate who would bring ethics to city government, is already embroiled in a controversial ethics issue. He has appointed Robert T. Grand as chair of the Capital Improvement Board (CIB), which manages the city’s convention center and sports stadiums, including that of the Indiana Pacers, a basketball team owned by the Simon family. There is a good chance that the Pacers' lease will be renegotiated next year. Grand, an attorney, represents the Simon family’s principal business, the Simon Property Group.

According to an article in yesterday's Chicago Daily Observer, Cook County commissioner Tony Peraica has proposed a series of improvements to the ethics code.

If a council member's law firm wants to bid on being the local government's attorney, a contract that is approved by the council, what is the responsible way to handle the matter?

Does a council member who is a realtor have a conflict with respect to any council matter that affects real estate, including a matter that affects property values ? That appears to be the view of NJ Superior Court Judge Grasso in a decision this week, according to an article in Thursday's Asbury Park Press.

It is difficult to emphasize too much that council control over the ethics process is not only inappropriate and ineffective, but harmful. The first use of a new ethics ordinance in the aptly named Battle Ground, Washington (pop. 18,000) provides yet another example of the problems that may arise.