Louisiana, Mississippi movin’ up; 20 states still flunk

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Two southern states — Louisiana and Mississippi — made the biggest strides in the Center for Public Integrity’s latest financial disclosure rankings for state legislators, but 20 out of the 50 states still received a failing grade and three of those states have no disclosure requirements at all.

Fourteen states in all have improved their disclosure laws since the Center’s last survey in 2006. In addition to Louisiana and Mississippi, Oregon, and Connecticut moved up in the rankings, while Massachusetts suffered the biggest drop.

Among the states that received failing grades are Illinois, Pennsylvania, Virginia, Indiana, Iowa, and Minnesota. The number of F's represents an improvement, though minor, over the 24 states that failed in both 2006 and 1999. Idaho, Michigan, and Vermont continue to tie for last place, as no personal financial disclosure laws exist, or have ever existed, in those states.

“Citizens have a right to expect a certain amount of basic and personal information about their elected officials,” said Mary Boyle, vice president for communications for Common Cause. Disclosure laws allow the public “to make a judgment about whether there are conflicts of interest,” Boyle said. When states have weak or nonexistent disclosure laws, she added, “the public knows less about an elected official.”

The Center has been reporting on disclosure requirements in state legislatures since 1999, and bases its rankings on a 43-question survey that measures public access to information on legislators’ employment, investments, personal finances, property holdings, or other activities outside the legislature. Center researchers obtain answers to the survey questions by examining state statutes and disclosure forms, and interviewing state ethics officers. Survey answers are assigned a numerical value adding up to a possible 100 points; the highest scores reflect the highest degree of disclosure. The Center defines a failing grade as a score of less than 60 points on the survey.

Big changes in Louisiana

Louisiana’s dramatic jump was rooted in the state’s poor performance in 2006, when it was ranked as number 44, with only 43 points. The disappointing score motivated Louisiana Governor Bobby Jindal to push a sweeping ethics reform package soon after entering office in January 2008. He signed the bills in the package over a period of several days beginning March 3, 2008, and the new laws took effect this past January. They require all lawmakers to report their outside financial interests — the first time such disclosure has ever been required in Louisiana. As a result of Jindal’s initiative, Louisiana has rocketed to the top of the Center’s rankings, with 94.5 points, earning the top slot among all 50 states.

“Just days after coming into office,” Jindal said in a statement, “we set out to fulfill our promise to completely transform the ethics laws in our state to encourage increased business investment and job creation so our children do not have to leave home to pursue their dreams.”

Louisiana’s new forms require filers to disclose officer and director positions with for-profit and not-for-profit organizations, income received from employment, and business interests, and to provide a description of property holdings. The state Board of Ethics updated its website: citizens can search for financial disclosure forms online, obtain copies of blank disclosure forms, and check to see which legislators have filed late or not at all. Many of the added requirements were adapted from the Center’s questionnaire, according to state officials.

While government watchdog groups like the Public Affairs Research Council (PAR) of Louisiana were supportive of Jindal’s legislative reforms, they have also expressed concern about how the policies will be implemented. Jim Brandt, president of PAR, notes that the new laws cover virtually every public official in Louisiana, and he wonders whether the Board of Ethics has enough staff to keep up with the influx of forms. And the new laws included a provision — not part of Jindal’s original proposals on the campaign trail — that stripped the board of its enforcement powers and transferred authority to a newly-created panel of administrative judges, causing the board’s members to resign in protest last June. Jindal and the legislature filled the vacant positions, and the board is currently functioning with the ability to oversee investigations, but not rule on them. The judges’ panel, meanwhile, has only held one hearing under this system.

“So, it’s sort of a mixed report,” Brandt said of the status of Louisiana’s new policies. “It’s great news on the legal front, but the jury is still out as far as adequate enforcement goes.”

Mississippi jumps ahead

Mississippi emerged as the second-most-improved state, jumping 11.5 points, and rising in rank from 34th to 24th place. Tom Hood, executive director of the Mississippi Ethics Commission, said he used the Center’s grading system as a template to create new ethics legislation, a bipartisan effort that was passed by the legislature in the 2008 session and signed by Governor Haley Barbour in May of that year. Legislators are now required to report all directorships, including those held at nonprofit organizations, names of investment entities, and employment information for their spouses. In addition, late filers are now also subject to penalties.

States often pass ethics reform legislation in the wake of political scandal, Hood said, which tends to stigmatize one lawmaker or one party as unethical. But Hood told the Center that because there was no such scandal in Mississippi, the ethics commission was able to function in a nonpartisan environment to bring about reform. “Nobody’s neck was on the chopping block and our proposals were taken objectively at face value,” he said. “This runs counter to the conventional wisdom that you need a scandal to focus on open government reforms. We found pretty fertile ground without a scandal like that.”

Governor Barbour declined to respond to a request for comment. Even with the improvements, Mississippi still rates only a D in the Center’s survey.

One area in which Mississippi continues to lag behind is online accessibility. Although the Mississippi Ethics Commission was authorized by the legislature last year to put its financial disclosure forms online, a significant lack of funding has put this project on hold. Hood said the new law requires online access by January 1, 2010, but the legislature ended its session without passing an appropriations bill to fund the project. Governor Barbour has announced he will call a special session to finalize next year’s budget; Hood said this needs to take place in the next few weeks, as the current fiscal year ends June 30. Hood said he does not expect any opposition to the proposed funding, but still could not guarantee the online system will be in place by next year. “Everything starts from scratch with a special session,” he said. “Nobody in government, and I mean nobody, knows what is going to happen.”

Modest change elsewhere

Joining Louisiana and Mississippi in improving their rank were Oregon and Connecticut. Oregon moved from 22nd to 19th place. The Oregon State Legislature toughened its ethics laws in 2007, requiring quarterly financial disclosure reports and the names of household members and relatives. Both of these provisions, however, were eliminated this year, as public officials complained that filing quarterly reports and listing names of all relatives were time-consuming and unnecessary. But legislators are still required to clearly mark their spouses’ officer and director information, a distinction not made on past forms.

Connecticut bumped up to 12th place from 15th. Connecticut unveiled a new electronic filing system this year that improved its public access score. Although the disclosure reports are still not accessible to the public online, they are now in an electronic format that makes it easier to receive them upon request. The new filing system also simplifies the process for legislators to send in their completed reports.

North Carolina moved up just one spot to 18th place, despite a sweeping ethics reform bill in 2006 that expanded the scope of filers. Under the old system, candidates only had to submit a report every four years; now all lawmakers must file annually. Filers, however, are allowed to submit either an “amendment” form or “no-change” form if they submitted a complete disclosure form the prior year. The bill, which has since been amended in the 2007 and 2008 sessions, also established a states ethics commission that receives filings and checks to make sure they are accurate and complete.

Public access is key

Peggy Kerns, director of the Center for Ethics in Government with the National Conference of State Legislatures, said government transparency is becoming an increasingly important issue in public policy circles and the current trend — generally speaking — is for states to beef up their financial disclosure laws. But Kerns, who was a state legislator in Colorado for eight years, also told the Center that unless the public has easy access and knows where to find information, disclosure laws are just an empty gesture.

“Financial disclosure is the first step, but that is the bottom line as far as ethical standards,” she said. “Then, does anybody care that it’s disclosed, does anybody look at the information and connect the dots?”

The Center found that a number of states had improved public access by making legislators’ disclosure forms available electronically, mostly online. In 2006, 21 states had this capability; since then, eight more states have followed suit — Alaska, Arizona, Connecticut, Florida, Maine, New Hampshire, Rhode Island, and South Carolina.

At least four states have improved disclosure requirements for spouses since the 2006 survey. Alaska and New Hampshire now require legislators to report their spouse’s employment information, while Maine updated its forms to include the spouse’s name and job title. Mississippi had made changes to its forms that allow filers to clearly delineate what belongs to a spouse.

Since the project began in 1999, States of Disclosure has provided a unique 50-state comparison of disclosure laws, highlighting those states that have made significant strides. Louisiana’s changes have made the Bayou State the most-improved in the project’s history, followed by Georgia, which jumped from 26th to 6th place in 2006. A few states, however, have moved in the opposite direction.

Virginia, for example, placed 8th in 1999, but has fallen to 31st place, mostly because other states made improvements while Virginia’s ethics laws remained essentially unchanged. Virginia state legislators must fill out a statement of economic interest annually and must disclose outside employment or investment information. But the state lacks the necessary oversight to ensure that the forms are filled out correctly. While other states have made efforts to ensure accuracy, often with the creation of an independent commission, Virginia’s legislators are mostly left to police themselves.

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