A recent change in Iowa’s tax code spared Mark Chelgren’s machine shop, welding company and wheelchair-parts plant from paying sales tax when buying certain supplies such as saws and cutting fluid.
The change passed by the state Legislature last year wasn’t just good for Chelgren’s businesses. It was brought about in part by Chelgren himself. The Iowa state senator championed the tax break for manufacturing purchases as part of his work at the Statehouse in Des Moines.
Chelgren isn’t the only state lawmaker doing his outside interests a favor. A North Dakota legislator was instrumental in approving millions of dollars for colleges that also are customers of his insurance business. A Nevada senator cast multiple votes that benefited clients of the lobbying firm where he works. Two Hawaii lawmakers involved with the condominium industry sponsored and voted for legislation smoothing the legal speed bumps their companies navigate. And the list goes on.
State lawmakers around the country have introduced and supported policies that directly and indirectly help their own businesses, their employers and sometimes their personal finances, according to an analysis of disclosure forms and legislative votes by the Center for Public Integrity and The Associated Press.
The news organizations found numerous examples in which lawmakers’ votes had the effect of promoting their private interests. Even then, the votes did not necessarily represent a conflict of interest as defined by the state. That’s because legislatures set their own rules for when lawmakers should recuse themselves. In some states, lawmakers are required to vote despite any ethical dilemmas.
Many lawmakers defend even the votes that benefit their businesses or industries, saying they bring important expertise to the debate.
Chelgren said the Iowa tax changes were good policy and that his background running a manufacturing business was a valuable perspective in the Statehouse.
"We have way too many people who have been in government their whole lives and don’t know how to make sure that a payroll is met," the Republican said. He said the tax change had only a negligible effect on his business, saving it a few hundred dollars a year.
Iowa Senate rules say lawmakers should consider stepping aside when they have conflicts if their participation would erode public confidence in the Legislature. That’s a step one local official said Chelgren should have taken, especially since the tax change costs the state tens of millions a year in revenue.
“We have to keep the public’s trust,” said Jerry Parker, the Democratic chairman of the Wapello County Board of Supervisors in Chelgren’s district. “If they see us benefiting financially from votes that we make, the perception is bad for all elected officials.”