A Call For Transparency

Jan 18, 2018

Commentary: Expanded economic interest disclosures would lead to more accountability

Making resolutions for a new year is a popular tradition, and better late than never is a familiar expression. With that in mind, here’s a suggestion for Illinois lawmakers as they return Springfield four weeks into the new year:

Why not resolve to strengthen the state’s ethics laws, in particular the economic disclosure that all candidates and officeholders must file? Beefing up the current weak requirements shouldn’t cost anything, while making more detailed information available would allow the public to have a better sense of what potential conflicts of interest exist for a particular politician. Voters surely would approve on both counts.

To give credit where due, more meaningful economic disclosure was among several new year’s resolutions offered by the Illinois Campaign for Political Reform as 2018 began. But the idea has been around for decades, all the way back to adoption of the 1971 Constitution, which required statements of economic

interest to be filed by all candidates and office holders, as provided by law. 

Sarah Brune, executive director of the Illinois Campaign for Political Reform, speaks at a press conference at the Thompson Center about legislation the organization supported. She is flanked by sponsoring lawmakers and other supporters.
Credit Illinois Campaign for Political Reform

Lawmakers then grudgingly crafted a disclosure statute, but not without much grousing, including one memorable complaint that public officials would be “naked in the fishbowl” by Rep. C.L. McCormick, a Vienna Republican noted for colorful rhetoric.

In its current version, the law simply requires candidates and office holders to file annual broad-brush entries in several categories, most notably:

•  Ownership in a company doing business in Illinois that’s worth more than $5,000 or pays more than $1,200 in dividends.

•  Service as an officer, director, partner or adviser with any professional entity providing more than $1,200 income.

*  The nature of professional services rendered of each entity from which more than $5,000 of income came for those services.

*  The identity, including the address of real estate, from which a capital gain of more than $5,000 was received by the person filing.

*  The name of any entity doing business in Illinois from which more than $1,200 in income was derived other than for professional services.

Names and addresses of the entities are required, but candidates and office holders do not have to list the actual amounts of income, dividends, or capital gains received, nor detail clients for whom professional services were provided. 

The intent of disclosure, of course, is to alert voters to economic interests that could pose a conflict as a public official carries out his or her duties.

But identifying such conflicts “is a huge gray area” under the current rules, says Sarah Brune, the campaign’s executive director, because the filings are so vague. What’s needed, she says, is more detailed disclosure, so that the media and the public understands what someone’s interests are.

Specific changes the campaign is proposing include requiring filers to disclose the names of businesses and investments with ties to the individual, along with the degree of ownership and the actual income received.

Also, professionals should be required to provide the names of individual clients from whom they’ve received more than $5,000, unless barred by confidentiality rules, rather than simply the types of services provided and the nature of the businesses served.

As a hypothetical, Brune notes a candidate now can report simply getting more than $5,000 for professional services on behalf of an energy company, when in fact the individual might have been paid $500,000 by Exelon.

Credit 401kcalculator.org / Flickr/Creative Commons BY CC 2.0

While perhaps far-reaching by Illinois standards, similar disclosure is standard practice at the federal level and in other states.  California and New York, for example, require candidates to list assets and income sources and amounts, and they and a dozen other states mandate that clients be named unless otherwise legally privileged, according to the National Conference of State Legislatures.

Enacting such changes in Illinois “would give us wealth of information more than what we already have,” says Brune. “If we want more clear information, we should require it as a policy.”

One model for stronger ethics disclosure already is in place in Illinois, promulgated by the Illinois Supreme Court for judicial candidates and sitting jurists in Rule 68. The rule calls for much more detail than what’s required of other officials. Judges have to disclose all their economic interests and those of their immediate family, as well as every source of noninvestment income. In addition, they have to list the names of all creditors owed more than $500 by the judge and his or her immediate family within a six-category range, starting at less than $5,000 and going to more than $250,000. The judge must name any attorney who is a co-owner of any of the listed economic interests and list every salaried office, directorship and employment of the judge and family. Finally, a catch-all category asks for any other economic interest or relationship of the judge or family that could create a conflict of interest.

Among those pushing for the judicial standards is the legislature’s first inspector general, Thomas Homer, a former state representative and appellate court justice. In a farewell message to the General Assembly in April, 2014, Homer renewed an earlier call for a flat-out prohibition on legislators acting when they have conflicts of interest and for disclosure to be expanded to mirror the enhanced level required for judges.

Now an attorney in private practice, Homer believes the changes are still needed to help restore public confidence in state government.

The economic statement now required “doesn’t tell anything,” he says. 

A prohibition on lawmakers acting when they have a conflict could be modeled after Congress or other states, he says, crafted narrowly to cover only instances in which an official’s action has “a significant impact to the member that’s different from the general effect on the public at large.”

One example, he adds, might be if a legislator “has a monetary interest in a piece of legislation that doesn’t benefit the public at large.”

Critics of such reforms argue that tougher ethical standards for public officials will deter otherwise qualified individuals from seeking office.

Critics of such reforms argue that tougher ethical standards for public officials will deter otherwise qualified individuals from seeking office — not wanting, perhaps, to be “naked in the fishbowl,” as McCormick put it decades ago.

Homer doesn’t buy it, noting that other states and Congress haven’t lacked for candidates, despite having tougher standards than Illinois. “I don’t think there’ll ever not be lots of people running for office,” he says.

Legislation embodying many of the changes sought by the campaign and by Homer is pending in the House, introduced last November by Rep. Grant Wehrli, a Naperville Republican, and co-sponsored by eight other Republican lawmakers, including Rep. Jeanne Ives of Wheaton, who’s challenging Gov. Bruce Rauner for the GOP nomination for governor in the March 20 primary.

The bill’s main intent is to upgrade ethical oversight of the legislature, but its provisions also include making “votes taken by members of the General Assembly when they have a conflict of interest” a violation of the state ethics act and requiring legislative candidates and sitting lawmakers to submit disclosure statements “in the same manner and depth as required for judges under Illinois Supreme Court Rule 68.”

Given the measure’s sponsorship by Ives and some of the House’s other most conservative members and ardent critics of House Speaker Michael Madigan, one might suspect the bill will remain stuck in the Rules Committee when the 100th General Assembly ends a year from now.

But partisan politics aside, stronger economic disclosure requirements and tougher conflict standards deserve consideration in coming weeks. As noted earlier, being for good government reforms doesn’t cost the state treasury anything and seems likely to be popular with voters. That’s a two-fer lawmakers ought to embrace.

Charles N. Wheeler III is director of the Public Affairs Reporting program at the University of Illinois Springfield.

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