Texas Gets a D- Grade in 2015 State Integrity Investigation

In his first State of the State address to the Texas Legislature in early 2015, newly elected Gov. Greg Abbott challenged lawmakers to dedicate their unfolding 140-day session to ethics reform, asserting that “the most important commodity that we have as elected officials is the bond that we share with our constituents.”

“Transparency — and rising above the appearance of impropriety — will strengthen that bond,” Abbott asserted. “But rejection of ethics reform could weaken that bond and rightfully raise suspicions about who we truly serve — ourselves, or the people of Texas.”

If the GOP governor’s reading of the public’s attitude was on the mark, then chances are that Texans are more suspicious than ever. Instead of enacting the first sweeping ethics reforms in nearly a quarter-century, members of the 84th Legislature ended their session by passing only a handful of mostly modest ethics bills.

More far-reaching measures, including a host of provisions championed by Abbott, collapsed in a House-Senate stalemate in the final hours before the session adjourned. Buried in the impasse: proposals to boost transparency on wining and dining by lobbyists, toughen limited public disclosure requirements for state officials and candidates, and shine a light on millions of dollars in undisclosed donations to politically active nonprofits.

The paltry body of work on one of the governor’s top priorities enhanced the state’s reputation as a place where — at least in the eyes of watchdog groups — lip service on ethics trumps actual results. Lurking in the background are indictments against former Gov. Rick Perry — who stands charged with abuse of power after he vetoed funding to a local district attorney’s office in what some argued was a political dispute — and the current attorney general, who faces securities fraud charges stemming from his private work while he was a member of the state House of Representatives. Both have pleaded not guilty, and a judge tossed one of two charges against Perry.

So perhaps it’s no surprise that the state earned a grade of D- in the latest State Integrity Investigation, a national assessment of state government accountability and transparency by the Center for Public Integrity and Global Integrity.

Texas ranked 38th out of 50, suggesting that the nation’s second-largest state — a powerhouse of high growth and economic prosperity — may be heading in the wrong direction when it comes to ethics and other measures of government integrity. In the first State Integrity Investigation, published in March 2012, the Lone Star State ranked 27th with an overall grade of D+.

The two scores are not directly comparable, due to changes made to update the project and methodology, such as eliminating the category for redistricting, a process that occurs only once every 10 years. Nonetheless, the 2015 survey shows Texas hovering just above a failing grade, underscoring the view that the state’s ethics infrastructure is in need of repair.

"There were high hopes that there was going to be lots of ethics reform and improvements but it turned out to be just the opposite,” said Craig McDonald, director of the liberal-leaning Texans for Public Justice, an Austin-based advocacy group that was part of a coalition pushing an ambitious ethics agenda this year.

After being informed of the latest State Integrity findings, Cait Meisenheimer, a spokeswoman for the governor, said Abbott would redouble his efforts to “boost Texans' trust in state government and strengthen our state’s ethics laws in a meaningful way.” She added that “while some legislation was passed and signed to address this, Gov. Abbott believes Texans deserve better and that the state of Texas must further address ethics reform in the next session — the right way.”

For the moment, though, ethics advocates and watchdog groups are still struggling to overcome their setbacks in 2015. “It wasn’t a very rosy session for ethics and reform,” McDonald said.

Tangled history leads to a “goony bird” agency

Texas is no stranger to scandals, some of which have played out in flamboyant, “everything-is-bigger in Texas” style. The epic Sharpstown Stock Fraud Scandal rocked Texas in the early 1970s following the disclosure that state officials had profited from manipulated stock purchases. Scores of political incumbents, even those not directly implicated in the scandal, saw their careers end in a throw-the-rascals-out backlash that turned over more than half the seats in the state House.

In the same era, one North Texas lawmaker converted $1,995 in stamps from his office account toward the purchase of a 1971 half-ton pickup, ultimately pleading guilty to three misdemeanor counts in a plea-bargain to avoid a trial on felony charges. In 1989, chicken magnate Lonnie “Bo” Pilgrim stirred an outcry for tougher campaign finance laws by passing out $10,000 checks in the Senate chamber.

Outrage over Pilgrim’s political largesse helped make ethics a top priority in the 1991 legislative session under then-Gov. Ann Richards, who outlined 13 specific requirements topped by a proposed ethics commission. In the end, Richards got less than half of what she asked for and the ethics commission, ultimately ratified by voters in a constitutional amendment, was considered so weak and susceptible to legislative interference that watchdog groups and major newspapers unsuccessfully called for a gubernatorial veto. “A Lousy Ethics Law,” lamented a Houston Post editorial, predicting that the commission would be tantamount to a “fox guarding the henhouse.”

The commission has been consistently scorned as being weak and ineffective since it was created. Even the current chairman and immediate past chairman, who ethics advocates widely agree have pushed the body on a more aggressive path, acknowledge the panel’s shortcomings. Chairman Paul Hobby described it as a “goony bird of an agency” because of its even-numbered eight-member makeup — four Republicans and four Democrats — as well as other factors, but he said the agency “does the best it can with the money it’s given.”

During the 2015 legislative session, Jim Clancy, the previous chairman and still a commission member, wrote in a letter to Hobby that the agency “faces an ethics emergency” because it is unable to enforce its orders in court due to a unique statutory restriction that effectively forces the ethics entity to build a brand new case anytime someone appeals a fine it has levied. The restriction, Clancy said, has prevented the commission from fighting a district court’s decision to toss out a $10,000 fine that the agency levied against conservative activist Michael Quinn Sullivan for failing to register as a lobbyist.

The commission “is like a traffic cop standing in the middle of an intersection with a whistle,” Clancy said. “He has no gun, he has no patrol car, all he can do is stand there and blow the whistle until help arrives.” The state received a category score of 62 on ethics enforcement.

Unlimited spending

A pervasive theme exposed in the State Integrity Investigation was the impact of unlimited campaign contributions and expenditures in shaping what some ethics advocates alleged was a pattern of cronyism during Perry’s 14 years as the state’s longest-serving governor.

Texas is one of about a dozen states that permit unlimited individual campaign contributions, according to the National Conference of State Legislatures. The result, according to McDonald, of Texans for Public Justice, is that “a small minority of citizens control a huge amount of the political money in the state.”  McDonald said his organization has documented “time and time again” that the 200 wealthiest campaign contributors generally supply about 40 percent of the money.

“Texas has a culture of corruption that starts at the very top,” said Tom “Smitty” Smith, who has been director of Public Citizen’s Texas office since 1985 and helped lead the push for ethics reforms both in 1991 and this year. Under what he called a “pay-to-play” system that he said “exemplified the Perry administration,” Smith said big donors were often rewarded with appointments to boards and commissions that shaped policy on state government.

Perry appointed more than 5,000 people to boards and commissions during his record-setting tenure, according to the Austin American-Statesman. Nearly $23 million — or about 21 percent — of the $109.8 million in donations that Perry received from 2000 to 2013 came from 1,187 Perry appointees and their spouses, according to Texans for Public Justice data compiled for a Sept. 22, 2014, Austin-American Statesman report.

Perry representatives did not return requests for comment, but Ray Sullivan, a former chief of staff and longtime adviser to the former governor, said Perry “named thousands of appointees who were vetted and confirmed by the Texas Senate, subject to strict ethics and disclosure laws, and served in most cases without pay.”

Ethics enforcers worry that dollar-driven politics could ultimately have a destructive effect. Hobby, the Ethics Commission chairman, said the sheer scale of donations lead some to think it’s only a matter of time before the next big scandal. Gregg Cox, director of the Public Integrity Unit at the Travis County District Attorney’s office, put it more simply: “There’s way too much money.”

This story is from the Center for Public Integrity, a nonprofit, nonpartisan investigative news organization in Washington, D.C. It is part of State Integrity 2015. How do each state's laws and practices deter corruption, promote transparency and enforce accountability? Click here to read more stories in this investigation.