Senator Jon Woods and the demise of the Arkansas ethics law

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With State Senator Jon Woods’ appalling record on ethics legislation, is it any wonder that big name politicians are endorsing him for another four-year term?

Remember in 2013 when he was the sole Senate cosponsor of Issue #3 (to amend the Arkansas Constitution) with Representative Warwick Sabin as the sole sponsor in the House?  The referendum was sold to the voter as badly needed “ethics reform.”

Of course, it is no wonder it sailed through both the Senate and House—as it doubled the terms in the Senate from 8 to at least 16 years and more than doubled them for the House, from 6 to 16 years.  Concerning salaries, with just the first of its annual reviews, ignoring tremendous public outcry, the friendly commission (appointed by the officials benefiting from salary increases), increased legislator salaries by about 150%. Meanwhile continuing the $150 per diem per meeting, plus mileage, plus the longer term limits and higher salaries will enable more legislators to qualify for nice pensions.)

But what about the ethics reform promised in the constitutional amendment?  It turns out even the ethics portion of the constitutional amendment was more status quo than reform.  It certainly didn’t keep lobbyists and organizations from feeding legislators a dump truck load of food and providing “beverages” every day of the legislative session. Take a look at the Senate social calendar copied on February 12, 2015. It is an extensive list of free food and beverage opportunities for legislators.

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But the constitutional amendment is not the primary focus of this article. Instead we want to highlight a bill on which Senator Woods was the lead sponsor – SB967 (Act 1280 of 2015).

In Act 1280, Woods quickly pulled out the few remaining teeth in the Arkansas ethics law (without the need for a vote of the people).

Here it is:  Under Act 1280, Woods inserted a “do-over” rule or as Max Brantley of the Arkansas Times calls it, a “mulligan” rule.  It basically says that if a politician fails to disclose a financial transaction, the politician doesn’t have to worry. If a complaint is made exposing the violation, the politician still has thirty days to correct his ethics report (return any money or gift if needed), without any investigation being conducted by the Ethics Commission and without any sanctions.  In fact, the Ethics Commission is not even allowed to use the violation against the politician if corrected within that thirty day time frame.

Allegedly, the “do-over” rule was needed because some reporting violations are merely accidental errors.  To back up this argument the new law says it doesn’t protect a politician who intentionally lies. These arguments are just a smoke screen. Arkansas law already took care of accidental errors.

We asked David Ferguson, former Director of the Bureau of Legislative Research, to give us a bit of history on the prior existing ethics law sanctions and how they came about.  He stated the following:

“Yes, in 1987-88 the legislature assigned me to assist the Governor’s Blue Ribbon Commission on Ethics. The commission was appointed by then Governor Bill Clinton. Most of their recommendations, including the sanctions, became part of an Initiated Act passed by the people in 1988.

“Concerning the sanctions, the commission had a subcommittee to work on penalties.  The commission was divided on how to enforce the ethics law.  Some early drafts imposed harsh penalties in order to deter violations. Other commission members thought the penalties were too harsh if the violation was accidental.  Because of this concern, the commission adopted a different set of sanctions.

“The revised sanctions included the option to merely give a violator a letter of caution, warning, or reprimand. A letter of caution is merely a message to be careful with your future reports. A letter of warning or a reprimand are essentially the same thing. They just sound worse.” (Emphasis added)

Did Senator Jon Woods think it was too harsh for a politician to be told to “Be cautious about your reports in the future”? Or was this just another opportunity to weaken the ethics laws.

Under Woods’ law there is little reason to bother to file a complaint on a violation.  You can prove a politician should have reported a transaction. But, how do you prove the failure to report it wasn’t just an oversight or even part of a series of oversights. It doesn’t matter how egregious the reporting error is, the politician can just file a corrected report and avoid any hearing or action by the Arkansas Ethics Commission.

Conduit For Action (CFA) thinks Senator Woods’ law makes it more likely for embarrassing transactions to be “accidentally” omitted from reports and hidden from the public. 

With the Arkansas ethic law gutted, has Woods’ law basically removed the core purpose of the Arkansas Ethics Commission?   Will complaints that might have been resolved by the Arkansas Ethics Commission now be left solely to be addressed directly to the FBI or IRS?

• According to the Federal Bureau of Investigation, the FBI’s #1 criminal priority is public corruption. (See https://www.fbi.gov/news/stories/2010/march/corruption_032610)
• The Internal Revenue Service is also vigilant in prosecuting public corruption. Here is a link to the IRS summary of public corruption investigations in 2015.

What a mess our ethics laws have become!

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HYPOTHETICAL EXAMPLE

Since few Arkansans have experience with Arkansas’ law on campaigning contribution and expenditure reports, CFA is adding a hypothetical example of how quickly things could become complicated once a politician fails to report transactions. The hypothetical example also shows the “do-over” rule is not merely some minor matter.

Note: This is a hypothetical example. Any resemblance to real persons, living, dead or even undead, is purely coincidental.

• Candidate W needs campaign money and borrows $30,000 dollars from “X” but Candidate W doesn’t report the loan as required by law.
• Many months after being elected Candidate W still hasn’t repaid anything on the loan. X demands repayment of his money. Candidate W has a problem.  He discovers people actually want you to repay loans.
• To repay X, Candidate W needs to borrow money. So Candidate W goes to “Y” and gets $30,000 to repay X. Candidate W doesn’t report this loan either since it is long after the election and very hard to explain.
• To solve his problem and raise the money, when Candidate W runs for election again he files a campaign report saying he personally loaned $30,000 to his new campaign.  This allows him to claim a campaign debt for which he can receive more campaign contributions and pay off his loan from “Y”.
• In this example, X is repaid; Y is repaid; and “Z” (the public) is left in the dark as to who financed Candidate W’s first campaign.
• If the sorry mess ever unravels, Candidate W will be able to use the “do-over” rule to claim he merely made a series of reporting errors, amend his reports, and no investigation will be made by the Arkansas Ethics Commission.