Ethics chief has received major raises

The governor faced ethics complaints that he personally profited from his campaign’s aircraft rentals from a company he partly owned, that he illegally used state campaign funds for legal bills related to a federal ethics investigation when he was a member of Congress and that he accepted campaign contributions that exceeded limits. The state ethics commission cleared Deal of major ethics violations in July 2012 while finding he made “technical defects” in a series of personal financial and campaign finance reports. Deal agreed to pay fees totaling $3,350.

Holly LaBerge

Before her appointment as executive director of the state ethics commission in August 2011, she was a lobbyist for the state Public Defenders Standards Council. She has said in sworn testimony that she received a phone call from the governor’s office asking whether she was interested in heading the ethics post even before it was open. An employee and a former employee of the commission have said that LaBerge said the governor owed her after the commission cleared him of major ethics violations in July 2012. LaBerge told The Atlanta Journal-Constitution on Thursday that “it’s pending litigation and I have no comment on this particular issue.”

Stacey Kalberman

The former executive director of the state ethics commission was forced out of the position in June 2011 after then-Chairman Patrick Millsaps said a looming budget crisis for the commission had required him to cut her salary by nearly 30 percent. Prior to that, Kalberman said she twice asked Millsaps to sign subpoenas involving the commission’s investigation into the complaints against Deal. She has since filed a lawsuit in Fulton County Superior Court claiming she was fired in violation of the Georgia Whistleblower Act because she was investigating irregularities in Deal’s campaign.

How we got the story

The Atlanta Journal-Constitution has been following the state’s ethics commission since before the departure of chief Stacey Kalberman and her deputy, Sherilyn Streicker, in June 2011. On Thursday, the AJC reported that Kalberman’s successor, Holly LaBerge, was accused of improperly intervening in a case involving Gov. Nathan Deal. Today’s story looks at documents obtained through an open records request detailing LaBerge’s pay increases at the agency.

Coming Sunday

The Georgia Government Transparency and Campaign Finance Commission was once known as the state ethics commission. “Ethics” disappeared from its name, and ethics is not really the mission of the agency.

The embattled head of the state ethics commission has received pay increases of more than 17 percent over the past two years, despite being hired as the agency said it had to cut costs.

Holly LaBerge’s salary increased from $85,000 when she came aboard in September 2011 to $92,000 in 2012 to $100,000 as of June 1 this year, according to records obtained by The Atlanta Journal-Constitution.

The newspaper reported Thursday that LaBerge is accused in sworn testimony of improperly intervening in an ethics commission investigation of Gov. Nathan Deal’s 2010 campaign for governor. Current and former staffers said she ordered documents removed from the case file and met with top aides to the governor while the probe was ongoing.

LaBerge declined to comment when contacted by the AJC.

The accusations raise fresh questions about the independence of the supposedly impartial agency charged with keeping tabs on the state’s elected officials.

The revelations on Thursday sparked calls for outside investigations and changes to the ethics commission. But LaBerge received votes of confidence from the top two members of the commission, which has the power to hire or fire the executive director.

“She has overall performed very well in managing the agency,” commission Chairman Kevin Abernethy said.

Deal, meanwhile, said during a fiery news conference that he barely knows LaBerge and denied she did him any favors. LaBerge, according to sworn testimony, bragged that the governor “owed her one” after she claimed to have made ethics complaints against him “go away.”

Deal found that preposterous.

“For somebody that I don’t know, I don’t see how I could owe her anything,” Deal said.

The governor, who was cleared of major ethics violations in 2012, railed against the newspaper and its report.

“I am so regretful of the decline that I have seen in the reporting by the AJC,” Deal said. “If they continue that downward spiral as it relates to every issue of major importance, they pretty well are going to descend to the level where they can’t even claim to be a fish wrapper.”

Deal and his campaign attorney, Randy Evans, pushed back hard against allegations that LaBerge somehow influenced the outcome of the cases against him. It was the commissioners, they said, not staff, who ultimately decided to largely dismiss the charges.

But Deal did not dispute the allegation that his office recruited LaBerge to lead the ethics commission even as it was investigating him. The governor said his office is frequently involved in recruiting agency heads, although he could not confirm LaBerge’s sworn testimony that the governor’s staff asked her whether she would be interested in the job two months before it became open.

“There may have been requests from our office if we had recommendations if they were looking for somebody to be the new executive director. … That was common,” Deal said

The governor plays a major role in choosing agency heads. But the ethics commission is designed to be at arm’s length of any political influence and formally selects its executive director.

William Perry, the executive director of the government watchdog group Common Cause Georgia, said if Deal was involved in choosing LaBerge, then something must be done.

“If these shocking allegations are true, Georgians deserve not only a thorough independent investigation into these matters, but also a complete overhaul of this agency,” he said.

The accusations against LaBerge emerged from the sworn testimony of the commission’s former computer specialist, John Hair, and its current attorney, Elisabeth Murray-Obertein. Both were ordered to give pre-trial testimony in a pair of whistle-blower lawsuits filed by the commission’s former executive director, Stacey Kalberman, and her former top deputy, Sherilyn Streicker. LaBerge has also given given sworn testimony in the suits.

Kalberman and Streicker were prepared to serve subpoenas in Deal’s case before, citing budget troubles, the commission voted in June 2011 to cut Kalberman’s salary by nearly 30 percent and eliminate Streicker’s job.

Kalberman ultimately agreed to resign. The pair filed lawsuits alleging they were pushed out for aggressively pursuing the Deal investigation. Their lawsuits are pending in Fulton County Superior Court.

The ethics complaint included accusations that Deal financially benefited from campaign expenditures. Other complaints included his use of a campaign account to pay legal fees and the way he reported some expenditures on his disclosures.

Deal was cleared of major violations in July 2012 but agreed to pay fees totaling $3,350 to address “technical defects” in personal financial and campaign finance reports.

Murray-Obertein filed a lenghty human resources complaint against LaBerge in August that accuses LaBerge of retaliating against her for testifying in the Kalberman lawsuit. Murray-Obertein has also filed a complaint with the State Bar of Georgia that accuses LaBerge of practicing law without a license.

Hair told the AJC that LaBerge fired him after he refused her order to remove documents from Deal’s case file. He would not say what was included in the documents. Randy Evans, Deal’s campaign’s attorney, said Wednesday that he believed the commission had been asked for financial records that should be confidential. Deal and Evans both said Attorney General Sam Olens would know whether documents were removed for privacy reasons.

Olens spokeswoman Lauren Kane on Thursday said Olens knows Hair made the accusation in his sworn statement. He said LaBerge also testified that Hair’s claim was “completely false.”

Kane said the Attorney General’s Office, which is representing the ethics commission, would not comment further because it’s “a case in active litigation.”

When the commission voted to cut Kalberman’s salary from $120,000 to $85,000 and eliminate Streicker’s job in 2011, commissioners said it was a cost-cutting move to solve a budget crisis.

Yet Abernethy, the current chairman, and Vice Chairwoman Hillary Stringfellow said LaBerge had increased the agency’s appropriations from the Legislature by more than $100,000 since arriving. They said LaBerge has been successful in collecting late fees, which had returned roughly $253,000 to the state treasury from September 2011 to May 2013.

Abernethy said that even with the raises, LaBerge is earning less than the $120,000 Kalberman received. Kalberman had a law license but Stringfellow said that doesn’t automatically entitle her to a higher salary.

“It’s the same position and the same responsibilities,” she said.

No other commission employee received similar raises, although Murray-Obertein received a 12 percent raise, to $67,000, in July.

The agency’s budget has increased 22 percent, or roughly $240,000, since July 2011. Increases included one-time money to upgrade computers, for a data-entry position and for an auditor. Murray-Obertein has said LaBerge has not filled those two positions.

But those budget increases only partially restored previous cuts. From 2007 to 2012, the commission’s budget was cut 41 percent and its staff was reduced by a similar percentage, the AJC reported in 2012. The agency’s boost in funding for the 2012 budget year was its first since 2008.

Commissioner Heath Garrett gave LaBerge a qualified vote of confidence, saying he supports her “at the moment.”

“We’ll examine it thoroughly in consultation with our lawyers,” he said.

Commissioner Dennis Cathey declined to comment. Kent Alexander, who resigned from the commission this week and was the lone Democrat on the five-person panel, declined to comment.

Abernethy was appointed by Lt. Gov. Casey Cagle; Stringfellow by House Speaker David Ralston, R-Blue Ridge. Garrett and Cathey were appointed by Deal, while Alexander was appointed by Sonny Perdue when he was governor. State law requires Deal to replace Alexander with another Democrat.

Meanwhile, Deal’s critics, including Democrats and Republicans who plan to challenge him in next year’s gubernatorial primary, slammed the governor.

Dalton Mayor David Pennington, who has announced a bid to challenge Deal in the 2014 GOP primary, said “there is a clear pattern from Nathan Deal: attack and try to discredit the messenger because he can’t defend the message or the facts.”

Sen. Vincent Fort, D-Atlanta, said “the cover-up is worse than the offense.”

“That’s why it’s all the more important that an outside entity investigates this as soon as possible,” Fort said.

By Thursday evening, Deal was using the story to raise money for his re-election campaign.

“I don’t have to tell you, the liberal news media will stop at nothing to slander conservatives,” he told supporters in an email. “Articles attacking me and other conservatives have been baseless, factually flawed, and give journalism a bad name. … Help me fight these attacks by making a contribution to our campaign today.”