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This week, Governor Cuomo announced that he, Senate Majority Leader Dean Skelos and Assembly Speaker Sheldon Silver had reached a three-way agreement on a substantial ethics reform package. Initially, and possibly more appropriately, named the “Clean Up Albany Act” in early press releases, the “Public Integrity Reform Act of 2011” proposes sweeping changes across a number of ethical disciplines. The proposed changes include the following:
Financial Disclosures: Financial disclosure statements filed with the new Joint Commission on Public Ethics from elected officials will now be posted on the internet and the prac tice of redacting the monetary values and amounts reported by the filer will be ended. The Act also includes greater and more precise disclosure of financial information by expanding the categories of value used by reporting individuals to disclose the dollar amounts in their financial disclosure statements. The Act requires disclosure of the reporting individual’s and his or her firm’s outside clients and customers doing business with, receiving grants or contracts from, seeking legislation or resolutions from, or involved in cases or proceedings before the State as well as such clients brought to the firm by the public official.
In Albany, this is a controversial measure as a number of legislators – who will now be required – effective July 1, 2012 and upon potential penalty of $40,000 for failing to do so – to disclose the names of “outside clients and customers” – are attorneys who do not wish to disclose the identities of their clients. As one would expect, backlash from legal members of the Assembly was immediate and vociferous.
Increased Access to Who is Appearing Before the State and Why: The Act establishes a new database of any individual or firm that appears in a representative capacity before any state governmental entity.
Additional Disclosures for Registered Lobbyists: The bill expands lobbying disclosure requirements, including the disclosure by lobbyists of any "reportable business relationships" of more than $1,000 with public officials. It also expands the definition of lobbying to include advocacy to affect the "introduction" of legislation or resolutions, a change that will help to ensure that all relevant lobbying activities are regulated by the new Joint Commission.
A New Joint Commission on Public Ethics: This is potentially the most significant development of the newly proposed legislation. The new Joint Commission on Public Ethics will replace the existing Commission on Public Integrity with jurisdiction over all elected state officials and their employees, both executive and legislative, as well as lobbyists. Among other restrictions, no individual will be eligible to serve on the Joint Commission who has within the last three years been a registered lobbyist, a statewide office holder, a legislator, a state commissioner or a political party chairman. Commissioners will be prohibited from making campaign contributions to candidates for elected executive or legislative offices during their tenure.
The Joint Commission will have jurisdiction to investigate potential violations of law by legislators and legislative employees and, if violations are found, issue findings to the Legislative Ethics Commission, which will have jurisdiction to impose penalties. Significantly, if the joint commission reports such a violation to the Legislative Ethics Commission (with full findings of fact and conclusions of law), that report must be made public along with the Legislative Ethics Commission’s disposition of the matter within strict timeframes. The Joint Commission will have jurisdiction to impose penalties on executive employees and lobbyists. Any potential violations of federal or state criminal laws will be referred to the appropriate prosecutor for further action.
This provision has proven controversial almost immediately. In order to initiate an investigation, the new Joint Commission will require that two appointees of the same party in a given branch assent. This means, as many have already pointed out, that in theory the commission could vote 11-3 to take action without anything being done. Similarly, the New York Times noted that “commissioners appointed by the Assembly speaker, Sheldon Silver, a Democrat, could effectively block investigations of any Democrat in the Legislature, while commissioners appointed by the Senate majority leader, Dean G. Skelos, a Republican, would have similar power over investigations of any Republican.”
Overall, however, it appears that most public interest groups believe that the newly proposed Joint Commission will strike the right balance between unbiased investigation and the prevention of politically motivated “witch hunts” against the party out of power.
Forfeiture of Pensions for Public Officials Convicted of a Felony: Certain public officials who commit crimes related to their public offices may have their pensions reduced or forfeited in a new civil forfeiture proceeding brought by the Attorney General or the prosecutor who handled the conviction of the official.
Clarifying Independent Expenditures For Elections: The Act requires the state board of elections to issue new regulations clarifying disclosure of Independent Expenditures.
Increased Penalties for Violations: The Act substantially increases penalties for violations of the filing requirements and contribution limits in the Election Law, and provides for a special enforcement proceeding in the Supreme Court. The bill also increases penalties for violations of certain provisions of the state’s code of Ethics that prohibits conflicts of interest.
Without a doubt, this legislation represents sweeping change that must be carefully studied, and compliance prepared for, by all doing business in New York.
Now, if only we could get the Governor to introduce a “Clean Up Washington Act”.
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The newest Philly reform effort of note is the city’s lobbyist registration regulation, which was signed into law in June 2010 but will not go into official effect until January 3, 2012. This regulation, labeled as Regulation No. 9 by the Philadelphia Board of Ethics, will for the first time in the city’s history require individuals who attempt to influence legislative or administrative action, or who endeavor to obtain city contracts, to register as lobbyists. In addition, the rule will place significant disclosure requirements on most lobbyists, lobbying firms, and lobbying principals operating in Philadelphia. Specifically, the regulation will require most registrants (those expending more than $2,500 or lobbying more than 20 hours per quarter) to periodically report their lobbying expenditures on gifts, hospitality, transportation, lodging and other associated activities. In addition, the new rule will mandate that registered Philadelphia lobbyists publically divulge basic information about the nature of their lobbying co ntacts and communications with city officials and employees.
Beyond these fundamental disclosure requirements, Regulation No. 9 will also prohibit contingency fee lobbying among registrants, mandate lobbyist training, and impose a number of conflict-of-interest rules on city lobbyists. In addition, the regulation will prevent registered city lobbyists from serving as officers for the political committees and political action committees of candidates seeking elected office in Philadelphia. Also, interestingly, the new rule prohibits any registrant from transmitting, uttering, or publishing any false, forged, counterfeit or fictitious communication to a city official or employee for the purpose of influencing legislative or administrative action. How broadly the false statement provision will be enforced moving forward will be interesting to watch. All told, however, Regulation No. 9 appears to take significant steps toward bringing Philadelphia’s municipal lobbying rules up to speed with those in place in other major cities around the county. Enactment of Philadelphia’s lobbyist registration regulation comes on the heels of another noteworthy reform put into place by the city council and Board of Ethics earlier this year. This reform, known as Regulation No. 8., went into effect in late March, and is designed to severely limit improper, partisan political activity on the part of city officers and employees. Like a mini-version of the federal Hatch Act, Regulation 8 seeks to prevent appointed Philadelphia officials and employees from using city resources to engage in partisan political activities. Likewise, the regulation seeks to prohibit city officials and employees from utilizing their status or tit le as a means of influencing or coercing participation in political activities. Along these same lines, Regulation 8 endeavors to prevent improper, partisan political behavior through the following mechanisms: (1) a ban on collecting, receiving, and soliciting political contributions for a partisan purpose; (2) a ban on membership in national, state, and local political party committees; (3) a ban on political campaigning and political management activities; (4) a ban on circulating nomination petitions or papers for political candidates; and (5) a ban on get-out-the-vote participation when such activities are organized or sponsored by a political party, candidate, or partisan political group. In practice, these provisions are designed to preserve a proper separation between impartial policy making and partisan political activity by city government officials and employees … a line that has not always been so clear in Philadelphia. Whether Regulation 8 will accomplish this goal moving forward, however, remains to be seen. This is particularly the case in light of a few of the broad carve-outs contained within the regulation. Exceptions to the political activity restrictions discussed above exist for a wide range of partisan political behavior, including engaging in most political activities organized by civic, community, labor, and professional organizations, and campaigning for or against referendum questions and municipal ordinances. Likewise, the regulation also exempts city council employees from having to comply with several of the aforementioned prohibitions, including the exclusion on partisan political campaigning and manageme nt. It is doubtful that the loopholes in Regulation 8 are broad enough to swallow the entire rule, but how they affect overall compliance is certainly something to keep an eye on in the future. For many, reforms like Regulation No. 8 and Regulation No. 9 might seem like too little, too late on the part of the Philadelphia city government and Board of Ethics. After all, over the past few decades, the City of Brotherly Love has become an environment more synonymous with appearances of cronyism and corruption than transparency and good governance. But in a city known for its comeback stories, I wouldn’t count out meaningful political reform quite yet.
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Last February, we posted an entry flagging potential concerns arising from the SEC’s new pay-to-play rules for investment advisors as applied to presidential candidates. Admittedly, at the time we were talking about Governors Haley Barbour and Mitch Daniels, but the same holds true now for Texas Governor Rick Perry.
The Compliance Building blog (Presidential Campaign Season and the SEC’s Pay-to-Play Rule) has just posted an excellent analysis of the issue. I highly recommend you check it out. As the blog notes:
“Registered Investment Advisors, private fund managers getting ready to register with Securities and Exchange Commission, and their employees need to be very cautious about making contributions to Governor Perry if they have a Texas state sponsored fund as a client or investor, or hope to have one as a client or investor in the next two years.”
Transparency Alert: the author is campaign counsel to several federal candidates including former Speaker Newt Gingrich.
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Last year (coincidentally, almost to the day), this blog was all atwitter (you’re following us, right?) about CalPERS’ announcement that it would now require contractors to reveal whether they are using placement agents to seek business with the pension fund. Now, one year later, CalPERS has announced that its governing board approved new corporate governance principles calling upon corporations to detail all yearly political and charitable donations -- including those made through trade associat ions and tax-exempt groups.
As we have noted here, the pressures faced by CalPERS to respond to recent Supreme Court authority allowing unfettered corporate independent expenditures, are not at all unique. Transparency advocates are rightfully concerned about an environment in which secret corporate and union political advocacy can possibly run amok. Here, the revisions to the CalPERS guidelines were sought by California State Treasurer Bill Lockyer, a Democrat and member of the CalPERS governing board. In his letter calling for action, Treasurer Lockyer noted (without apparent empirical or anecdotal support) that a lack of transparency harms “corporate value” and that:
Increasingly, corporations are using [trade associations and tax exempt groups] in an attempt to cloak massive political spending in secrecy through “independent expenditure” campaigns, many of which are notorious for making unfair and unfounded personal attacks with which no company or its investors would want to be publicly associated.
The California Chamber of Commerce was not amused:
The new proposed policy amounts to “forcing publicly held corporations to show their competitors and political adversaries their political investment strategy, without receiving the same information in return,” Barrera said.
The CalChamber is leading a coalition to oppose the change to the corporate governance principles, specifically the section dealing with charitable and political contributions. In a letter to CalPERS, the coalition noted that the new section “is an unfair and discriminatory mandate on corporate boards of directors, designed to chill the ability of businesses to defend themselves from political attacks by competitors, overzealous regulators, labor unions or no-growth advocates.”
If the publicly traded companies are unable to defend themselves against the political attacks of their adversaries, the proposal will have massive unintended consequences for the very people CalPERS is obligated to protect and support.
In addition, the CalChamber noted the general invalidity of the premise behind the CalPERS proposal:
The CalChamber has pointed out that the premise of Lockyer’s proposal—that corporate value is negatively correlated with corporate political transparency—is not true.
Professor Lawrence Ribstein of the University of Illinois notes that the negative correlation “may be because firms hurt most by government regulation must engage in more political activity.”
Professor Roger Coffin of the University of Delaware has found that companies “that signed the ‘anti-Citizens United pledge’ in the aftermath of the decision did not see a material increase in firm value. Nor did the value of several industry-specific indexes go down. This represents good news for shareholders and the companies themselves.”
Notwithstanding this opposition, on November 14, the proposed revision to CalPERS’ Global Principles of Accountable Corporate Governance passed as follows:
6.5 Charitable and Political Contributions: Robust board oversight and disclosure of corporate charitable and political activity is needed to ensure alignment with business strategy and to protect assets on behalf of shareowners. We recommend the following:
a. Policy: The board should develop and disclose a policy for approving that outlines the board‘s role in overseeing corporate charitable and political contributions, the terms and conditions under which charitable and political contributions are permissible, and the process for disclosing charitable and political contributions annually.
b. Board Monitoring, Assessment and Approval: The board of directors should monitor significant charitable and political contributions (including trade association contributions
directed for lobbying purposes) made by the company. The board should ensure that only contributions consistent with and aligned to the interests of the company and its shareowners are approved. The terms and conditions of such contributions should be clearly defined and approved by the board.
c. Disclosure: The board should disclose on an annual basis the amounts and recipients of significant monetary and non-monetary contributions made by the company during the prior fiscal year. If any expenditures earmarked or used for political or charitable activities were provided to or through a third-party to influence elections of candidates or ballot measures or governmental action, then those expenditures should be included in the report.
As a final tease, blogger Keith Paul Bishop of Allen Matkins wrote of the change: “Interestingly, the Chamber has completely overlooked the most obvious legal infirmity of the guideline, but I’ll save that discussion for a future post.” Argghh! Don’t you hate it when that happens? I guess we’ll have to stay tuned. (For the record, my vote on the “obvious legal infirmity” is that this policy completely misses the fundamental Citizens United distinction between corporate independent expenditures and contributions).
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Of significance to this blog, the resolution calls upon Congress to amend the Act to prohibit lobbyists from working their trade with any member of Congress for whom he or she has raised money in the past two years. The resolution also recommends a refinement of the definition of “lobbyist” to enhance registration and disclosure. With respect to contributions by such lobbyists, the resolution recommends mandating that a federally-registered lobbyist may not:
(a) lobby a member of Congress for whom he or she has engaged in campaign fundraising during the past two years;
(b) engage in campaign fundraising for a member of Congress whom he or she has lobbied during the past two years;
(c) make or solicit financial contributions to the reelection campaign of a member of Congress whom the lobbyist has been retained to lobby for an earmark or other narrow financial benefit; or
(d) enter into a contingent fee contract with a client to lobby for an earmark or other narrow financial benefit for that client.
The proposal is likely to enjoy enhanced stature because of the high caliber, and bi-partisan bona fides of the task force issuing the underlying report recommending the changes this past January. Co-chairs to the ABA task force included former Republican FEC Commissioner Trevor Potter, noted Democratic attorneys Rebecca Gordon and Joseph Sandler, and former Reagan Solicitor General and current Harvard Law School professor Charles Fried. Nothing says “bipartisan” and “mood of America” like agreement between former counsel to Obama for America, John McCain 2008, the Gipper, and Stephen Colbert.
Already, the American League of Lobbyists (ALL) is responding to this shot across its bow with a promise to release a report of its own in response to the ABA’s proposals. ALL President Howard Marlowe has also signaled that the League may embark on an effort kill this portion of the proposal before it gains any traction. As reported in Roll Call, Marlowe acknowledged “the significance of money in the policymaking process” represents a “significant” problem, but then pivots to signal an effort to kill the proposal with the backhanded compliment that while the leagues’ proposal will be similar, “[t]he ABA knows ‘that they are on the short end of the stick constitutionally when they’re doing that, and it’s not likely to pass muster.’” Marlo we also reached out to Politico to characterize the proposed contribution ban as “not practical at all.”
You have to give ALL props for trying, but there would appear to be far less constitutional infirmity in this proposal, which simply prohibits lobbyists from plying their regulated trade with those they have previously supported politically, than we have seen in other attempted bans on free association and expression covered and criticized by this blog in the past.
There is an old legal saying that “good lawyers know the law, great lawyers know the judge.” The ABA’s proposal looks to refine lobbying effectiveness more towards “what you know” and less towards “who owes you.” The ABA has captured the mood of the country with a sensible proposal that is as likely to enjoy as much legislative success as anything trying to make its way through an otherwise dysfunctional legislative environment.
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Request approval of a Resolution amending the Fulton County Code of Laws regarding campaign contributions from entities doing business with, or seeking to do business with, Fulton County.
The resolution to be taken up, proposed by Commissioner Emma Darnell, closely mirrors a pay-to-play contract restriction proposed two years ago for the City of Atlanta by Common Cause Georgia. In its current form, the proposed resolution provides that no corporation, entity, or individual will have the right to bid for, or hold, a county contract if it has either made a campaign contribution of $500 or more to a County Commissioner or has provided any direct or indirect gift or contribution to a County Commissioner or any Fulton County employee.
For the purposes of determining whether a person has reached the $500 threshold, Commissioner Darnell’s resolution proposes aggregating all contributions or gifts made by an individual, their parents, siblings, spouse, or children as well as by any company that the individual controls or holds a 10% stock interest in. With respect to company contributions and gifts, the proposed resolution would aggregate all contributions or benefits conferred by any “officers, directors, partners, members, or salaried employees of the entity, and of any affiliated or subsidiary entities.”
Yes, you read that right. Under the proposed resolution, a company such as Delta Air Lines would theoretically be debarred from contracting with Fulton County (they have an airport in Atlanta, don’t they?) if even one of its salaried employees pays for a birthday cake for a next door neighbor who just happens to be a Fulton County employee. (Transparency Note: Delta Air Lines is a client of our firm, but this example could just as easily apply to any corporation having any employee who inadvertently makes a $500 campaign contribution or any gift to a County Commissioner or county employee).
As this blog has noted before, well-meaning and good-intentioned efforts to restrict back room dealing almost always get hoisted upon the petard of the broad language necessary to prevent circumvention but predictably results in negative, unintended consequences. The Law of Good Intentions almost always loses out to the Law of Unintended Consequences. Under this proposal, compliance costs will skyrocket, as will the likelihood of unnecessary and inefficient bid protest litigation due to inadvertent violations. In light of these potential effects, simple disclosure of all campaign and gift activity in the contracting process strikes me as the much more sensible approach.
I also have concerns that such restrictions will needlessly limit campaign activity and chill political speech inside of Fulton County. The words I wrote two years ago here still ring true to my ear:
While few would argue that the procurement process in Atlanta doesn't need more sunshine, the Common Cause proposal appears to go a few steps to far. Most troublesome is the proposal to prohibit persons who make contributions of over [$500] from bidding on any … contracts for the next year, as the prohibition applies even if the contract in question was not in existence at the time of the contribution. Restricting contribution amounts in this manner would undoubtedly chill the making of political contributions for City of Atlanta elections altogether, as any person or entity with any potential interest in any City contract in the future could not make contributions without the fear of being locked out of all future business. This is the sort of broad restriction that has proven to be problematic in jurisdictions such as Colorado. Similarly problematic is the apparent willingness to consider contributions by spouses and children of contributors in making prohibition determinations. Again, Colorado should serve as a cautionary tale here.
Needless to say, Common Cause Georgia, and many others, do not share my concerns. Whether Fulton County’s proposed resolution passes tomorrow or not, however, the waves of “restriction as reform” continue to hit the beach.
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The newest Philly reform effort of note is the city’s lobbyist registration regulation, which was signed into law in June 2010 but will not go into official effect until January 3, 2012. This regulation, labeled as Regulation No. 9 by the Philadelphia Board of Ethics, will for the first time in the city’s history require individuals who attempt to influence legislative or administrative action, or who endeavor to obtain city contracts, to register as lobbyists. In addition, the rule will place significant disclosure requirements on most lobbyists, lobbying firms, and lobbying principals operating in Philadelphia. Specifically, the regulation will require most registrants (those expending more than $2,500 or lobbying more than 20 hours per quarter) to periodically report their lobbying expenditures on gifts, hospitality, transportation, lodging and other associated activities. In addition, the new rule will mandate that registered Philadelphia lobbyists publically divulge basic information about the nature of their lobbying co ntacts and communications with city officials and employees.
Beyond these fundamental disclosure requirements, Regulation No. 9 will also prohibit contingency fee lobbying among registrants, mandate lobbyist training, and impose a number of conflict-of-interest rules on city lobbyists. In addition, the regulation will prevent registered city lobbyists from serving as officers for the political committees and political action committees of candidates seeking elected office in Philadelphia. Also, interestingly, the new rule prohibits any registrant from transmitting, uttering, or publishing any false, forged, counterfeit or fictitious communication to a city official or employee for the purpose of influencing legislative or administrative action. How broadly the false statement provision will be enforced moving forward will be interesting to watch. All told, however, Regulation No. 9 appears to take significant steps toward bringing Philadelphia’s municipal lobbying rules up to speed with those in place in other major cities around the county. Enactment of Philadelphia’s lobbyist registration regulation comes on the heels of another noteworthy reform put into place by the city council and Board of Ethics earlier this year. This reform, known as Regulation No. 8., went into effect in late March, and is designed to severely limit improper, partisan political activity on the part of city officers and employees. Like a mini-version of the federal Hatch Act, Regulation 8 seeks to prevent appointed Philadelphia officials and employees from using city resources to engage in partisan political activities. Likewise, the regulation seeks to prohibit city officials and employees from utilizing their status or tit le as a means of influencing or coercing participation in political activities. Along these same lines, Regulation 8 endeavors to prevent improper, partisan political behavior through the following mechanisms: (1) a ban on collecting, receiving, and soliciting political contributions for a partisan purpose; (2) a ban on membership in national, state, and local political party committees; (3) a ban on political campaigning and political management activities; (4) a ban on circulating nomination petitions or papers for political candidates; and (5) a ban on get-out-the-vote participation when such activities are organized or sponsored by a political party, candidate, or partisan political group. In practice, these provisions are designed to preserve a proper separation between impartial policy making and partisan political activity by city government officials and employees … a line that has not always been so clear in Philadelphia. Whether Regulation 8 will accomplish this goal moving forward, however, remains to be seen. This is particularly the case in light of a few of the broad carve-outs contained within the regulation. Exceptions to the political activity restrictions discussed above exist for a wide range of partisan political behavior, including engaging in most political activities organized by civic, community, labor, and professional organizations, and campaigning for or against referendum questions and municipal ordinances. Likewise, the regulation also exempts city council employees from having to comply with several of the aforementioned prohibitions, including the exclusion on partisan political campaigning and manageme nt. It is doubtful that the loopholes in Regulation 8 are broad enough to swallow the entire rule, but how they affect overall compliance is certainly something to keep an eye on in the future. For many, reforms like Regulation No. 8 and Regulation No. 9 might seem like too little, too late on the part of the Philadelphia city government and Board of Ethics. After all, over the past few decades, the City of Brotherly Love has become an environment more synonymous with appearances of cronyism and corruption than transparency and good governance. But in a city known for its comeback stories, I wouldn’t count out meaningful political reform quite yet.Legal Recruiting Firms Legal Search Firms Attorney Headhunters attorney placement Attorney Placement Firm
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This effort to regulate conduct in the derivative swap market by the SEC emerges out of the Dodd-Frank Act's comprehensive framework for monitoring over-the-counter swaps and the activities of “security-based swap dealers” and “major security-based swap participants” that engage in security-based swap transactions with counterparties (including “special entities” such as federal agencies, states and political subdivisions, employee benefit plans, governmental plans, and endowments). The rules the SEC advanced this week would require swap dealers to disclose to their buyers the risks associated with transactions, the potential conflicts of interests involved, and the day-to-day values of their swaps, which would aid purchasers in assessing the overall worth of specific deals.&nbs p; The rules would also mandate that swap dealers doing business with special entities ensure that their counterparts use independent financial advisers to assist with transactions. Additionally, dealers would be prohibited from participating in a wide range of “pay to play” practices.
Under these new pay to play rules, securities-based swap dealers and their “covered associates” would specifically be barred from engaging in swap transactions with a “municipal entity” for a two-year period if they choose to make certain types of political contributions to officials of that municipal entity. This Proposed Rule 15Fh-6 is modeled on, and intended to complement, existing restrictions on pay to play practices under Advisers Act Rule 206(4)-5, which imposes restrictions on political contributions by investment advisers providin g or seeking to provide investment advisory services to public pensio n plans and other government investors, and MSRB Rules G-37 and G-38, which impose such restrictions on municipal securities dealers and broker-dealers engaging or seeking to engage in the municipal securities business. The pay to play restrictions are also similar to rules the Commodity Futures Trading Commission (CFTC) recently proposed for non-securities-based swaps.
According to SEC Chairwoman Mary L. Schapiro, these new pay to play provisions and the other business conduct standards in the proposed rules will work to “level the playing field in the securities-based swap market by bringing needed transparency to this market and by seeking to ensure that customers in these transactions are treated fairly.” That is yet to be seen, but all five SEC commissioners nevertheless voted unanimously to propose the rules and introduce them through formal public notice. The proposed rules will remain open for public comment until August 29, at which point the SEC will take any submitted remarks under advisement and make a final vote as to their implementation.
It will be interesting to see how business leaders and public officials alike react to the SEC’s proposal during the upcoming notice and comment period. Businesses, and in particular investment firms, have had to adjust to a litany of newly proposed regulations and pay to pay rules in the wake of the passage of the Dodd-Frank Act. As such, it has left companies universally unsure as to what types of activities are permitted and prohibited in their day-to-day business. Public officials, however, have been quick to applaud any and all efforts by the federal government and its numerous business regulatory bodies to restrain “unsavory” corporate practices – practices that the SEC, MSRB, CFTC, and other entities assert have contributed to the current economic downturn and led to the misappropriation of billions upon billions of dollars in taxpayer money. Over the next few months, we shall see if both trends continue and if the movement toward increas ed federal regulation of business conduct and political speech persists.
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Notably, that alert observed:
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What I didn’t address is the possibility that someone at Fulton County already knows the resolution is legally invalid as an attempt to regulate campaign activity statutorily reserved to the State. The evidence would appear to indicate that they do.
A careful read of Commissioner Emma Darnell’s website announcing the resolution shows that someone appears to have inadvertently attached a privileged legal analysis from the Indiana Attorney General to the Indiana Senate to the end of her proposal concluding that a virtually identical resolution, “if enacted by the City of Fort Wayne, would be invalid as an attempt to regulate, without specific statutory authority, conduct which is regulated by a state agency.” (emphasis added)
One can only speculate as to the reason why such a legal opinion would be attached to the proposed Fulton County resolution. One potential possibility would be that the Commission is already concerned that the resolution as proposed is legally invalid. On the off-chance that Commissioner Darnell’s website changes subsequent to this post, here is a screen-grab of the resolution along with the apparently inadvertently attached legal opinion as it was originally circulated.
Without offering any legal advice upon which anyone should rely, it would appear that Georgia’s constitutional and statutory structure mirrors that which concerned the Indiana Attorney General when he analyzed the Fort Wayne pay-to-play proposal. As is the case in Indiana, the Fulton County proposal clearly seeks to regulate conduct related to campaign financing and contributions. As is the case in Indiana, Georgia’s “Home Rule” provisions limit the power of municipalities to matters not preempted by the General Assembly through general law and not specifically enumerated as matters of state authority under O.C.G.A § 36-35-6. Included among those powers reserved to the state are authority over election procedures and campaign finance rules, which are specifically administered by the St ate Board of Elections and Georgia Government Transparency and Campaign Finance Commission in accordance with the requirements of general law and the state constitution.
In fairness, there are some in Indiana who disagree with the analysis and conclusion reached by Indiana Attorney General Zoeller; including Fort Wayne’s former city attorney. Nonetheless, this would appear to be a good opportunity for Fulton County to slow down, exhale, and reconsider.
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As announced by the White House, the President is http://www.washingtonpost.com/politics/obama-weighs-disclosure-order-for-cont...">examining an order that would mandate that all federal contractors disclose any and all contributions to groups that engage in political activities. This is contemplated, the White House says, in direct response to the Supreme Court’s opinion in Citizens United v. FEC (discussed here) and Congress’ failure to enact the DISCLOSE Act (discussed here).
To learn more about what, exactly, the President has in mind, one needed to be on board Air Force One (headed to California on a Presidential and DNC fundraising swing, ironically enough) to hear White House Press Secretary Jay Carney say the following:
Q Jay, there was -- there were reports this morning that the administration is considering an executive order requiring companies seeking government contracts to disclose their contributions to groups that under current law would be secret. Is that correct?
MR. CARNEY: Well, what I can tell you is there is a draft -- there’s a process, and it’s in the -- it’s part of a process. There’s a draft, and the particular specifics of that executive order could change over time, so I can’t talk about the specifics. What I can tell you is the President is committed to improving our federal contracting system, making it more transparent and more accountable. He believes that American taxpayers deserve that, and that's what he intends to pursue through this executive order.
Q Is there any political goals behind this?
MR. CARNEY: Quite the contrary. He believes very strongly that taxpayers deserve to know whether or not the contractors that their money is going to is being used -- how they're spending their money, and how -- whether they're -- how they're spending in terms of political campaigns. And his goal is transparency and accountability. That's the responsible thing to do when you’re handling taxpayer dollars.
Q Is he likely to go ahead with the executive order? Or is there another way to accomplish it?
MR. CARNEY: I can’t -- there’s an executive order in the draft process. I can’t give you any specifics on it because the specifics could change. That's the nature of the process.
Q Jay, on a trip like this that combines presidential events with campaign events, can you talk about how it’s funded? For example, there are no presidential events in Los Angeles. Is that entire part of the trip funded through the campaign?
MR. CARNEY: Ari, you know the -- when there is travel like this that involves official travel and also political travel, this administration very diligently follows all the same rules that the Bush administration did. And as far as the specifics on how that breaks down, I’ll have to get back to you. I don't have that. But we’re very careful about making sure that all those rules are followed.
“Diligently [following] all the same rules that the Bush administration did” and breaking substantial new ground all at the same time. That’s a pretty impressive two-step.
One immediate challenge comes to mind: if all federal contractors and bidders are required to disclose their contributions to groups of any kind that engage in political or issue advocacy, how does one prevent federal contract officers from demonstrating bias against bidders supporting unpopular views or the party out of power? This is a decent enough effort at transparency that strikes me as having the potential to trod all over our constitutional rights to free expression and freedom of association. To quote David Wenhold, immediate past president of the American League of Lobbyists, “Sunlight is good, but sometimes too much sunshine can cause cancer.”
This is definitely one to stay tuned to.
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