For Ethics Commission, Big Hurdles to Reform

This is one in a series of occasional stories about ethics and transparency in the part-time Texas Legislature.

Shortly after the close of the 82nd Legislature, state Sen. Mike Jackson made an unusual request. The La Porte Republican asked Gov. Rick Perry to veto a measure he had just amended.

Jackson's amendment, added to an ethics bill passed in the last 48 hours of the regular legislative session, was meant to eliminate fines against candidates and officeholders who make innocent clerical errors on their campaign finance reports. As written and quickly passed, it would have required the state to dismiss any complaints against filers who claimed they had made mistakes in good faith — severely undercutting the Texas Ethics Commission's ability to enforce campaign finance law.

The provision never made it into law. But Jackson’s intentions aside, for some government watchdogs, the incident clearly demonstrated the pitfalls of an ethics system where elected officials set their own rules.

The Ethics Commission is up for "sunset" review in this 83rd legislative session, a time when agencies generally face major reform legislation based on the recommendations of a state panel. But Austin ethics lawyer Fred Lewis said any attempts to give the agency more teeth could be blocked by the same hurdle that has stymied such efforts in the past — lawmakers themselves.

“The Legislature is tough on crime and potential criminal defendants, except when it's them," said Lewis, who is involved in efforts to reform the commission. 

The more than 30,000 personal financial statements, campaign finance reports and lobbyist activity records filed annually with the commission are the linchpin of the state's ethics laws, which rely largely on public scrutiny to trigger enforcement. Responsibility for ensuring the accuracy of the self-reported information in those documents falls to the commission’s board, a bipartisan group made up of eight political appointees that has at times been accused of being too sympathetic to lawmakers.   

Last year, the state's Sunset panel recommended strengthening the agency's enforcement abilities through changes to its investigations process, decreasing fines for minor reporting errors and finding the resources for sorely needed updates to technology.

Established in 1991 through a constitutional amendment, the commission’s purposes are broadly defined in state law. Among them are eliminating “undue influence over elections and government” and “ensuring the public’s trust and confidence.”

In practice, the primary way the commission fulfills those objectives is to serve as a depository for financial, campaign and lobby filings. The commission responds to ethics complaints brought by the public but does not initiate investigations of its own. It does not conduct any audits of the information contained in the filings beyond ensuring they come in on time and the forms are properly filled out.

“It does a good job as a librarian; it doesn't do a good job as a cop,” said Craig McDonald, the director of Texans for Public Justice, which advocates for transparency in government.

Any effort to change that may be complicated by a lack of resources. When the Legislature reduced state appropriations to the agency from $2 million to $375,000 in 2011 — a cut that included money for ethics training for state employees and officeholders — funding for the commission had already been stagnant since 2002. An increase in registration fees for lobbyists has made up for some of the lost state funding but not all, leaving the commission to operate with out-of-date technology and a slim staff.

Ethics legislation in recent years has targeted the administrative fines the commission imposes for late filing or incomplete forms, which many lawmakers view as unfair. Since 2005, legislators have passed measures providing penalty exemptions for smaller political action committees and giving candidates and officeholders additional leniency in meeting deadlines and correcting reports.

According to records provided by the commission, the average fine assessed through sworn complaints filed by the public rose from $540 in 2007 to $1,437 in 2010 — but has been just below $480 for each of the last two years. 

Two of the highest fines the commission has ever assessed through the sworn complaint process — $29,000 against Supreme Court Justice Nathan Hecht in 2008 for failing to report an estimated $168,000 discount on legal fees, and $100,000 against Criminal Court of Appeals Justice Sharon Keller in 2010 for not disclosing $2 million in personal property holdings — are both still on appeal.

The commission already waives most of the fees filers incur for late or incomplete filings. In 2012, it approved two-thirds of the requests it received to waive administrative fees, reaching an eight-year high. Until then, the approval rate had typically hovered at around 50 percent.

The Ethics Commission board has to balance candidates’ and officeholders’ need for flexibility in certain circumstances with the “critical importance” of timely and accurate reporting, said David Reisman, the commission’s executive director.

“While some might see that as tedious paperwork, it is crucial for our operation,” he said. 

Under the pink dome, there is frustration that the commission’s duties tilt so heavily toward a “box-checking exercise,” said state Rep. Rafael Anchia, D-Dallas, who sits on the Sunset Advisory Commission. He said that comes from lawmakers who feel they have been unfairly branded as ethics violators for minor errors like failing to file a report on time and from those who believe the commission doesn’t do enough to investigate serious complaints.

The Sunset report also draws attention to what it calls the commission’s unnecessary emphasis on “minor reporting infractions.” Among its recommendations is shifting the investigation of complaints to staff rather than board members, who would still make the decisions on sanctions. But it stops short of calling for the creation of an enforcement division that operates independently from the board, a change McDonald said would go further toward ensuring its effectiveness.

Meanwhile, not everyone agrees that the Ethics Commission needs drastic reform — including Jackson, who is out of office after serving more than two decades in the Legislature. While the current system is not perfect, he said, it is “fair and open.”

“The Legislature created the Ethics Commission and funds the Ethics Commission," he said. "I think if the Ethics Commission goes off on these wild goose chases every once in a while and is doing things that the members of the Legislature didn’t really intend for them to do, and we are paying all their bills, then I think they should be subject to the Legislature since we created them in the first place.”