Honolulu Weekly

Democratic lawmakers were widely criticized for failing to reach an agreement during the 2007 legislative session on tougher ethics rules aimed at curbing conflicts of interest among legislators.

But when they voted to increase public scrutiny of potential conflicts of interest among the most powerful state boards and commissions, an area where the governor exerts considerable control as a result of the office’s power of appointment, the bill and Gov. Linda Lingle’s veto received little public attention.

House Bill 910, strongly backed by the State Ethics Commission, would have required the appointed members of 10 important state boards to file public financial disclosure statements revealing their business ties, real estate dealings, organizational commitments and other interests that could mire them in future conflicts. Financial disclosures can call attention to possible conflicts of interests but also can show that no conflicts exists, raising public confidence in state officials.

The issue of conflict of interest among board and commission members isn’t only a theoretical concern. In 2003, for example, Maui developer Everett Dowling resigned from the University of Hawai’i Board of Regents after conflict-of-interest concerns were raised over a land deal between the university and a company he controlled.

Currently board members file confidential disclosures which are seen only by ethics commission staff, while elected officials, as well as appointed department heads and their deputies, file reports that are open for public inspection.

The bill required public financial disclosures by members of the UH Board of Regents, Hawai’i Tourism Authority, Hawaiian Homes Commission, Public Utilities Commission, Employees’ Retirement System, Hawai’i Community Development Authority, Research Corporation of the University of Hawai’i, Land Use Commission, and the boards of the Land and Natural Resources and Agriculture Departments.

In testimony before the Senate Committee on Judiciary and Labor in support of the measure, the State Ethics Commission noted that several state departments are run by boards that wield executive power and therefore members should be treated the same as other department heads.

Lawmakers were persuaded, and the bill passed without a dissenting vote in either the House or Senate. It was sent upstairs where it was promptly vetoed by Gov. Lingle.

Lingle’s veto message reflects several misunderstandings concerning existing ethics rules as well as the requirements of the state Constitution.

For example, Lingle says the bill ‘attempts to improperly equate members of boards and commissions who serve without compensation as if they were the same as paid state employees or elected officials.’

But the authority for treating unpaid board members and state employees equally comes directly from the state Constitution.

Article IV of the Constitution requires the state and each county to adopt a code of ethics ‘which shall apply to appointed and elected officers and employees of the state or the political subdivision, respectively, including members of the boards, commissions and other bodies‘ (emphasis added).

The state ethics law, Chapter 84 HRS, already makes no distinction between appointed members of boards and commissions and paid employees. The term ‘employee’ is defined in Section 84-3: ”Employee’ means any nominated, appointed, or elected officer or employee of the state, including members of boards, commissions, and committees, and employees under contract to the state or of the constitutional convention, but excluding legislators, delegates to the constitutional convention, justices and judges’ (emphasis added).

So despite Lingle’s protestations, there’s nothing ‘improper’ about making that connection. It’s been the law for a long time.

Lingle further argues that the public already has ‘a reasonable opportunity’ to raise conflict of interest concerns, but without details about the financial interests of board and commission members needed to identify the potential for conflicts, those ‘reasonable opportunities’ are rendered somewhat meaningless.

The Legislature is expected to convene in special session over the summer to consider overriding several of Lingle’s vetoes, but whether HB 910 will be among them remains to be seen.

Kirk Caldwell, House Majority Leader, says HB 910 had not been suggested as a possible veto override target in discussions between House and Senate leadership during the hectic closing days of the 2007 session. Caldwell says, however, that members of the majority caucus will have an opportunity to suggest a review of the bill prior to the convening of any special session. ([iLind.net])