Money and Democracy

Published — September 13, 2016 Updated — December 8, 2017 at 2:47 pm ET

Congressman offers unusual defense in ethics probe

Williams wasn’t helping himself, he was helping lobbyist


U.S. Rep. Roger Williams, a Texas Republican under investigation by the House Ethics Committee, asserts that he did nothing wrong when he offered an amendment that would benefit car dealers — despite the fact that he himself is a car dealer.

Members of Congress, say the rules, may not use their positions for personal financial benefit. But Williams asserted in a statement that he did not profit from his actions.

Instead, Williams revealed, he offered the amendment at the behest of a lobbyist. And the lobbyist — whose employer, the National Automobile Dealers Association, one of the congressman’s top donors — was even kind enough to send along “proposed language” for the text of the amendment.

The case is being considered by the House Ethics Committee. There is no timetable for when the committee will rule. But regardless of what happens, the Austin area congressman’s defense offers a rare glimpse at how business is often done in the Capitol.

In this case, at least, it reveals a place where lobbyists have enormous influence; where a legislator was arguably more concerned with his own interests and those of his donors than his constituents; and where actions that appear at first glance to be clear conflicts of interest, are in fact, routine.

A late night vote

The current controversy is over a bill pushed by Cally Houck, mother of Raechel and Jacqueline Houck, 24 and 20 years old, who were killed in 2004 when the Chrysler PT Cruiser they rented from Enterprise Rent-A-Car crashed into an oncoming semi-tractor trailer in central California. The car had been under a safety recall for a fire hazard that caused a loss of steering.

Houck successfully sued the company and embarked on a crusade to get a law passed that would prohibit rental car companies from offering vehicles that are subject to safety recalls.

The Raechel and Jacqueline Houck Safe Rental Car Act, finally made it into law as part of a massive transportation bill in 2015. But during the process, there was a hiccup. The bill faced resistance from the National Automobile Dealers Association, a powerful trade association which was concerned that its members might be forced to ground vehicles for “minor” defects.

Rep. Williams offered an amendment on the floor of the House just before midnight on Nov. 4 that alleviated the dealers’ concerns. It would, as understood by Williams and NADA, carve out an exemption for auto dealers. It would, in effect, allow them to rent or loan out vehicles even if they were subject to safety recalls. Dealers often loan or rent cars to customers who are getting theirs serviced.

>> UPDATE: House Ethics Committee scolds, doesn’t punish Roger Williams

Williams, in introducing the amendment, said, “I am a second-generation auto dealer. I have been in the industry for most of my life. I know it well.” Williams is chairman of Roger Williams Auto Mall in Weatherford.

Williams’ amendment would make the act apply only to companies whose “primary” business is renting cars, which would effectively exclude dealerships. No such provision existed in the Senate bill.

Consumer advocates and Cally Houck were livid. The Center for Public Integrity wrote a story about Williams’ action, raising the issue of whether what he did was a conflict of interest. Rosemary Shahan had no doubt.

“It seems to me that if it isn’t illegal, if it isn’t an ethics violation it ought to be,” said Shahan, president of Consumers for Auto Reliability and Safety, a consumer group. “His amendment benefits nobody but car dealers. And he’s a car dealer.”

Williams declined to respond to Center inquiries for the report; the piece ran on the Center’s website, that of the Texas Tribune and the Fort Worth Star-Telegram. Once the story was posted, and began circulating, the congressman did respond.

“This is why people are so tired of politics,” he wrote. “A laughable ‘charge’ has been brought on by an editor of a publication backed by billionaire liberal George Soros. For years, the so-called Center for Public Integrity has mounted countless attacks against Republicans under the false description as a ‘nonpartisan’ ‘news organization’ (and I use those quotations intentionally because this organization is neither).”

The Center has received funding from the Open Society Foundations, which are funded by George Soros, a billionaire who has spent millions to help Democrats, including Hillary Clinton, get elected. The foundation, however, has no editorial control over the nonpartisan Center, a Pulitzer Prize-winning nonprofit organization made up largely of veteran journalists.

Complaint filed

Despite the protestations of the congressman, the story attracted the interest of the Campaign Legal Center, a watchdog group based in Washington, D.C. The organization wrote a letter to the Office of Congressional Ethics, an investigative body that reviews complaints against members and recommends whether the House Ethics Committee should conduct its own probe.

Williams did not cooperate with the OCE, according to the agency. The agency recommended in a report adopted April 22 that the House Ethics Committee use its subpoena powers to obtain records from the congressman’s dealership.

After the OCE report was issued, Williams, through his attorney, released a 12-page response, , defending his actions.

At the heart of the matter is whether, Williams “improperly took official action on a matter in which he had a personal financial interest.”

Specifically, House rules state members “may not permit compensation to accrue to the beneficial interest of such individual from any source, the receipt of which would occur by virtue of influence improperly exerted from the position of such individual in Congress.”

In addition, rules state that members “shall behave at all times in a manner that shall reflect creditably on the House,” and “shall adhere to the spirit and the letter of the Rules of the House.”

In addition, rules that govern all federal employees state that government workers should “never discriminate unfairly by the dispensing of special favors or privileges to anyone, whether for remuneration or not; and never accept for himself or his family, favors or benefits under circumstances which might be construed by reasonable persons as influencing the performance of his governmental duties.”

The OCE, in a 6-0 vote, recommended that the House Ethics Committee extend its investigation into Williams’ conduct.

On June 27, 2016, House Ethics Committee leaders announced the body would “extend the Committee’s review of the matter” in order to “gather additional information necessary to complete its review…”

The extension of the review “does not itself indicate that any violation has occurred,” the committee added.

Nothing to see here

In his statement, Williams says that his business does indeed offer rental cars for use by customers who are getting their vehicles fixed as well as loaner cars.

“In these instances, the dealership only provides the convenience of a relationship with a nearby rental company, Enterprise Rental, and at a special rate that is given to dealerships established by an agreement between FCA and Enterprise: $30 per day, taxes included. The dealership does not mark up rental fees for profit.”

Williams, in his defense, said he sometimes loses money under the arrangement and that the passage of the amendment would have “zero bearing” on his business interests.

Shahan said dealers still benefit indirectly.

“They benefit, of course, by profiting from having the repair business,” she said. “And you can be sure that it’s built into the price they charge for the repair.”

Shahan said it was clear that the congressman was not interested in consumers.

“It doesn’t get any clearer that he was not acting in the public interest, he was acting in the interest of the NADA members. He doesn’t even claim to be acting in the public interest,” she said.

As to loaner cars, Williams and NADA were concerned that the provision would apply to those too.

“This bill will regulate a small business dealer with a fleet of five loaner vehicles the same as it would regulate a massive rental car company with hundreds of thousands of vehicles in their fleet,” he said in remarks on the House floor.

Williams has a fleet of eight loaner cars, given to people who are having their cars worked on.

While it is up to the committee to determine whether Williams did anything wrong, the congressman’s defense itself made some rather illuminating admissions regarding his relationship with the National Automobile Dealers Association.

According to the statement, the top lobbyist for NADA, Michael Harrington, was concerned about the effect the rental car act would have on his dealer members. He emailed Sean Dillion, Rep. Williams’ legislative director on Oct. 29. Dillion in turn asked J. Spencer Freebairn, Williams’ deputy chief of staff, to contact Harrington to discuss “issues surrounding” the bill in question.

“Mr. Freebairn did so, and by that afternoon NADA had sent proposed language for Amendment 819 to him,” according to the statement, signed by Williams.

Williams agreed to offer the amendment, which consisted of adding a single word — “primarily” — to the bill. The added word effectively allowed automobile dealers to rent vehicles under recall, unlike big rental companies.

He submitted the proposed change to the House Rules Committee, which determined that the amendment could be considered, and then Williams met with Harrington to “further discuss legislative strategy.”

So did the congressman use the lobbyist’s suggested language verbatim? That’s not clear. Williams has declined to talk to the Center. Harrington has not returned a call requesting comment.

Powerful lobbying force

Car dealers are known to be an influential force in Congress. A dealership exists in practically every congressional district in the nation. And these often-wealthy businessmen and women are ably represented by Harrington, who is well qualified for the job.

Harrington is former director of external affairs for the National Highway Traffic Safety Administration under President George W. Bush. He also served as legislative director to U.S. Rep. Bob Franks, R-N.J. and deputy chief of staff to U.S. Rep. Clay Shaw, R-Fla.

Harrington lobbied the Houck bill for the auto dealers’ association, which spent more than $1.2 million on lobbying in the fourth quarter of 2015, including work on the rental car act. NADA has contributed $32,500 to Williams’ campaigns since 2011, according to Federal Election Commission records. Williams was first elected in 2012. The Almanac of American Politics calls him a “prolific fundraiser.”

Car dealers, not surprisingly, are major supporters of Williams.

The industry, through contributions from individuals and political action committees, has given him a total of $667,950 over his relatively short career, according to the Center for Responsive Politics. That ranks him fifth among active and former House members, which is a little misleading.

Former congressman John Dingell, a Detroit-area Democrat who served 60 years, collected more than $1.1 million from car dealers and their political action committees. He’s number one. Joe Knollenberg, a Republican, also from Michigan, collected $990,162 during his 16-year tenure. He’s number two.

Republican Roy Blunt of Missouri, collected $818,723, and served in leadership positions in the House, which is a great way to attract big contributions. He comes in at third. And fourth place goes to Republican John Boehner, former House speaker, at $806,992.

Advocates and opponents of the amendment were particularly incensed that it was submitted on the House floor just before midnight, and slipped through on a voice vote.

Once the issue of the amendment was raised, the legislation went to a conference committee with the Senate. During that process, Williams’ amendment was tossed out. But the car dealers’ presence was still felt.

In the conference committee, it was decided that establishments that rent fewer than 35 cars would be excluded, meaning car dealerships would not be affected.

“It was a victory of low caliber,” said Cally Houck, mother of the young women who were killed. She won’t be happy until the loophole is eliminated altogether.

“I continue to look forward to taking them on again.”

This story was co-published with the Dallas Morning News.

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