Since the Center began keeping track of state financial disclosure laws in 1999, three states have stood out somewhat notoriously for, well, doing nothing. Idaho, Michigan, and Vermont have consistently finished tied for last — and have received a grade of F — because they have no laws whatsoever requiring any sort of financial disclosure for legislators. Might that change? The answer is different in each of the states. Here’s an update on the state of play.
In April, the Idaho Senate unanimously passed a bill that would have required an annual financial disclosure form. Senate Minority Leader Kate Kelly, a co-sponsor of the disclosure bill, had unsuccessfully pushed ethics reform for years, and said she usually couldn’t even get a hearing scheduled. But this year was different. Majority Leader Bart Davis was interested in co-sponsoring the measure, and Governor C. L. “Butch” Otter got on board as well. The compromise legislation that emerged would have required disclosure of outside employment, disclosure of sources of gross income over $10,000, and a general description of Idaho real estate property holdings, other than a personal residence.
But the House is another matter. Speaker Lawerence Denney essentially killed the legislation when he let it sit on his desk for the duration of the session, which ended in early May. Denney said he’s not against financial disclosure, but told the Center that the bill “does nothing.” It would have required legislators to provide employer information, he said, but exempts certain professionals, like lawyers and doctors, from disclosing client information.
“I think sunshine is good,” he said, “but sometimes I think that you do something and it actually inhibits the process. It makes it worse.”
But there seems to be general agreement that the issue isn’t dead. Majority Leader Davis said he intends to move similar legislation during the next session, and he expressed optimism about collaborating with Speaker Denney. “I anticipate that we’ll make serious progress next year,” said Davis.
Everyone — Republican and Democrats, House and Senate, legislative and executive — seems to accept the idea of a financial disclosure statement. So what’s the problem?
Minority Leader Kelly cites several factors — an unmotivated public, for one. People may be angry that a disclosure law doesn’t exist, but ultimately it’s not an every day sort of issue for them. She also cites the political environment. Idaho is perhaps the most Republican state in the country, which makes it difficult for Kelly — and her few Democratic counterparts — to push her agenda. “We have to scream really loudly to get heard,” she says.
But the issue may also have suffered from a general lack of understanding. Davis, the majority leader, told the Center that he had been reticent to support disclosure legislation in the past because he was uncertain just what the disclosure forms might entail. Once he looked at what other states were doing and what sort of information they made public, he began to change his mind.
“I thought that this was a reasonable request,” he said. “The voters in my district should have the basic answers to some of these basic questions.
“We want to continue to keep Idahoans in confidence that their legislators are acting on behalf of the state of Idaho and not on their individual interests,” Davis said. “I already know that to be true, but this provides for the pre-disclosure of conflicts of interest. That’s the target we’re trying to hit.”
Rich Robinson, executive director of the Michigan Campaign Finance Network, blames the lack of disclosure progress there on political dysfunction in the legislature.
“This is something that comes up every legislative session,” Robinson said. “But it’s all part of shallow political theater.”
This year is, arguably, no different. The Democratically-controlled House passed a financial disclosure bill in March, but that measure is still awaiting a hearing in the Senate. Then, just last month, Attorney General Mike Cox — a Republican who is gearing up to run for governor — proposed his own set of ethics measures, which includes an annual financial disclosure report. “If Michigan is to restore its reputation as a quality place to live and create jobs,” Cox announced in a press release, “we must send a clear signal that Michigan is a national leader when it comes to government ethics.”
John Sellek, a spokesperson for attorney general Cox, said the Center’s consistent ranking of Michigan in last place certainly made an impact. Cox has observed what other states have done to improve their score, especially Louisiana, and wants to do the same thing for Michigan. In the Bayou State, Governor Bobby Jindal saw ethics reform as a means to bring businesses to Louisiana, and Sellek said that Cox strongly agrees with that strategy.
Cox’s plan includes the disclosure of outside employment, investments, real estate, and liabilities for elected officials, candidates, and their immediate family members. Sellek said the attorney general’s plan goes beyond what the Democrats proposed by also addressing gifts from lobbyists.
However, Robinson of the state campaign finance network, is skeptical.
“Do I think that bill will be passed? No,” he asked. “I don’t think it will even get a committee hearing. I think [the attorney general] would like to present an image that he’s concerned about political reform.”
In response to these criticisms, Sellek said Cox is a leader in promoting transparency in Michigan, which can be demonstrated by his voluntary disclosure of personal finance information and department spending. He is currently the only elected official there to do so.
Both of the proposals on the table in Michigan are fairly similar; they would require financial disclosure by elected officials and candidates for the first time in the state’s history.
“The interest in moving this kind of change is intense,” Sellek said, “and the attorney general is hopeful that we’ll see the legislature review both packages.”
Unlike Idaho and Michigan, where disclosure bills have periodically appeared, Vermont seems unlikely to jump on the bandwagon any time soon. In fact, there seems to be a general feeling that a substantial level of disclosure is unnecessary in a state with such a modest population: just over 621,000. The amount of cash sloshing though the political system, and the potential for conflicts of interest, may be less than in larger states — or so the argument goes.
Even some of the reform-minded see validity in the argument. “It’s true to say that it’s less likely you’ll find candidates in the pocket of big donors in Vermont,” said Paul Burns, executive director of the Vermont Public Interest Research Group, the leading organization for election reform initiatives in the state. “And because it’s a small state, the background and occupations of many people running for office are fairly well-known.”
Even so, Burns would like to see some basic disclosure requirements put in place. State politicians and candidates often disclose financial information on a voluntary basis, he said, but the lack of official rules can create gray areas and controversy. Last year, the Democratic candidate for Vermont governor, Gaye Symington, released her outside income, but not her husband’s information — an omission that raised a red flag with her opponent, Governor Jim Douglas. Douglas, who chose to disclose the financial interests of immediate family members as well as his own, unleashed an attack ad that posed the question: “Should Gaye Symington join Jim Douglas in making full, honest disclosure Vermonters deserve and put the public interest before her financial interests?”
According to Burns, though, the exchange was less about an actual commitment to transparency and more about campaign tactics. “Because there are no rules,” he said, “it turns into a petty political debate, instead one of substance.”
Currently, there are no formal disclosure proposals in the works. Next year, Vermonters will vote for a new governor, but it’s not clear that ethics reform will be an issue in the race.
One of the candidates, Secretary of State Deb Markowitz, doesn’t expect it, arguing that ethics reform just isn’t a priority for Vermonters. She said that disclosure bills have been proposed in the past, but “the legislature generally responds that Vermont is a small place… We really know each other.”