‘Pay-to-play’ law needed

In the weeks before his stunning demise, Illinois Gov. Rod Blagojevich was in a race against the clock. On Jan. 1, a new state law was going into effect that barred contractors from making campaign contributions if they performed more than $50,000 in business with state agencies.

With a goal of raising $2.5 million for his campaign coffers, Blagojevich had no time to lose. In a flurry of calls captured on federal wiretaps, the governor directed staff to hit up a state highway contractor for $500,000, a hospital executive for $50,000 and an engineering firm for $60,000.

The hospital executive held special promise, the governor believed, because Blagojevich planned to increase hospital reimbursement rates. “I’m going to do $8 million for them,” Blagojevich said, according to the government’s affidavit. “I want to get [Hospital Executive 1] for 50.” That’s 50, as in $50,000.

The donations-for-favors scheme, brazenly described in Blagojevich’s own words, is called pay-to-play, and it’s exactly the sort of alleged corruption that Illinois’ new ethics law seeks to halt. Pay-to-play laws are long overdue in Illinois, as Blagojevich’s case makes clear, but they are also needed in Georgia and the rest of the country. Bribery statutes ensure that politicians don’t use their office for personal gain. Pay-to-play laws address the equally pernicious problem of politicians rewarding big-dollar contributors with government favors.

For years, the argument for strong campaign contribution limits has been that excessive donations allow lobbyists and others to purchase access to decision makers, crowding out ordinary citizens. The system also emboldens politicians to extort donations in exchange for government contracts and services. Simply put, those who give, get.

Although Illinois may be the current poster child for this sort of alleged corruption (Blagojevich’s Republican predecessor, George Ryan, is serving 6 1/2 years for taking kickbacks in exchange for state contracts), pay-to-play scandals have recently rocked state and local governments from New Jersey to California. Just last week, The Associated Press reported that a New Mexico grand jury is examining $110,000 in donations made to three political committees controlled by Gov. Bill Richardson, President-elect Barack Obama’s nominee for commerce secretary. The donations came from a California company that earned nearly $1.5 million on a New Mexico contract, and grand jurors are looking at a potential pay-to-play arrangement, the AP reported.

Here in Georgia, three businessmen pleaded guilty in August in connection with a pay-to-play scheme that raised campaign cash to influence the former governor of Mississippi, who they believed had sway over a Mississippi contract of interest to the men and their company, the Facility Group. After securing the lucrative Mississippi contract, the executives arranged a Cobb County fund-raiser that netted former Mississippi Gov. Ronnie Musgrove $45,000 in donations. Contributions from Facility Group employees were reimbursed by the company — in violation of the law — and then billed back to the taxpayers of Mississippi through bogus invoices submitted under the company’s state contract, according to the 30-page indictment.

Pay-to-play laws stop such corruption by taking political donations off the table. The laws ban businesses and other entities from receiving government contracts if they contribute more than a token amount to elected officials. The strongest measures also ban or sharply limit contributions to state political parties, which are in most cases controlled by the elected political leadership and subject to weaker contribution limits overall. (In Georgia, contributors can give as much as they like to state parties.)

The contribution limits extend not only to the business entity itself, but also to principal owners, officers and family members. Much as a political action committee, government contractors are required to report which of their officers and family members have made contributions and how much.

The laws strengthen public confidence in government in two important ways: They reassure taxpayers that their money is being spent without the appearance of outside, political influence; and they ensure that government agencies choose the most efficient, lowest cost contractors for jobs.

In New Jersey, a motor vehicle inspection contract that went to a politically connected contractor cost taxpayers $200 million in cost overruns. In Mississippi, the beef processing plant that the Facility Group was supposed to manage shut down three months after the company walked away from its contract. The company pocketed more than $6 million, while Mississippi’s taxpayers paid — $54 million — to repay state-backed loans secured to build and operate the facility.

Politicians talk about good government all the time. Blagojevich himself pledged to run the most ethical government Illinois voters had ever seen. But how can voters be sure when political donors so often wind up with state business?

According to federal prosecutors, Blagojevich planned to hit up a state highway contractor for $500,000 because the contractor stood to benefit from the governor’s $1.8 billion plan to add express lanes to Illinois toll roads. Was the $1.8 billion toll plan good for Illinois drivers, or simply good for Blagojevich?

Referring to both the size of the project and the contractors who stood to gain, the governor’s own admissions suggest politics, not policy, was the motivation.

“I could have made a larger announcement but wanted to see how they perform by the end of the year,” the governor told an associate, referring to the highway contractors. “If they don’t perform, [expletive] ‘em.”

To date, seven states have adopted pay-to-play legislation, with Illinois set to be the eighth. All of them acted after scandals shook public confidence and sent political leaders to prison or the halls of public shame.

Georgia now has an opportunity to take action before scandal strikes. In fact, strong pay-to-play legislation might be just the tonic for an upcoming legislative session that will be mostly dominated by budget-cutting. Legislators might even break new ground with pay-to-play and also limit contributions from individuals seeking appointments to state boards. Georgia governors and legislative leaders have a long history of rewarding big financial donors with influential appointments.

But even if they do nothing, federal prosecutors have sent them a strong message with their case against Blagojevich: It’s as much a crime to deliver government favors to contributors in exchange for political donations as it is to sell them for personal gain. Watch out.

— Ken Foskett, kfoskett@ajc.com, for the editorial board