Scandal’s shock led to ethics law

NASHVILLE — Many lobbyists and legislators here still lower their voices and look around when they talk about May 26, 2005. Some just refer to it as “that day.”

On that Thursday morning, open-mouthed staffers watched as federal and state agents hauled out four legislators in handcuffs as part of a statewide bribery sting called “Operation Tennessee Waltz.”

In the end, three Democratic senators and one Republican representative either pleaded guilty or were convicted. Eight other people also pleaded guilty or were convicted.

After “the Waltz,” the dance between Tennessee legislators and lobbyists would never be the same. The next year, legislators scrambled to outdo each other on tightening lobbying rules. A state known for having some of the weakest lobbying rules in the nation abruptly imposed some of the strongest.

As the Georgia Legislature looks to shore up its own lobbying rules this year, Tennessee’s story provides a possible path forward.

“Things are radically better,” said Dick Williams, a volunteer lobbyist for Tennessee Common Cause, the nonpartisan open government group. Williams said the laws have given lobbyists without much money a more level playing field, while saving wealthier lobbyists cash since they don’t have to take legislators to expensive restaurants.

Legislators and some lobbyists, however, lament the loss of camaraderie they say lobbyists’ dinners and trips provided.

“We went completely overboard,” said Curry Todd, a Republican representative from west Tennessee and the chair of the House’s State and Local Government Committee.

These days, one thing is certain: Compared to the Tennessee Legislature’s formal promenade between legislators and lobbyists, Georgia’s political dance more closely resembles a strip club’s bump-and-grind.

For decades, lobbying in Tennessee “was pretty much wide open,” according to Williams at Common Cause, who has lobbied for the group since the early 1970s. Influence peddling was unrestrained. Lobbyists would leave their credit card at the hotel bar across the street from the plaza, and legislators would drink all night for free. Lobbyists took legislators to expensive dinners and on trips.

Over the years, various scandals — including “Operation Rocky Top,” a late ’80s FBI probe of bingo lobbying bribes that led to dozens of convictions — led the legislature to react with new ethics rules.

In 1995, the legislature passed a lobbying gift ban, but enforcement was modest.

Then came Operation Tennessee Waltz. Agents with the FBI and the Tennessee Bureau of Investigation posed as corrupt businessmen seeking government contracts. Officials, including longtime state senators, took bribes.

After the fallout, legislators held a special four-week legislative session and drafted an ethics bill that became the toughest in the state’s history.

The end result, the Comprehensive Governmental Ethics Reform Act of 2006, set up a State Ethics Commission. The commission has the authority to review and audit lobbyist contracts with employers. Lobbyists and their clients also have to pay registration fees every year to help fund the commission. Clients must give a range of what they are paying lobbyists and give specifics if audited. The commission conducts random audits.

Gifts are still banned. So are meals, unless they are offered to every member of the legislature and an invitation is presented to the ethics commission seven days in advance. When back in their districts, legislators are allowed meals at the expense of lobbyists, but they are limited to $53 per meal, capped at $103 for the whole year.

Drew Rawlins, executive director of the State Ethics Commission and the Registry of Election Finance, said the tightened ethics laws, especially the lobbyist audits, have “completely changed the way they meet and the way they interact.”

The one-on-one dinner, where much of lobbyists’ work used to get done in Nashville and where much of the lobbyist work still takes place in Georgia, has disappeared from Tennessee politics.

Underneath Tennessee’s Capitol is a warren of hallways, meeting rooms and offices where the state’s part-time legislature does its real work. During session, the halls are packed with legislators, staff, government officials, citizens — and hundreds of lobbyists trying to buttonhole legislators to put their spin on things. That part of lobbying here hasn’t changed. About 500 people are registered to lobby, and about 250 work the halls on a regular basis.

Some support the changes — and want them to go further. Williams at Common Cause said, “The lobbyists like the ban, because the ones who were spending a lot of money are spending less for the same amount of impact. And those of us who didn’t have a lot of money, well, it gave us a level playing field.”

His views, however, are not the majority in the legislature’s halls.

Jimmy Naifeh, a Democratic representative from West Tennessee and a former speaker of the House, has been at the capital in various capacities for at least 36 years. He said he warned legislators not to make major changes in response to the Waltz, but they didn’t listen. Today, he sighed, “There is no camaraderie like we used to have between the members.”

Sen. Bill Ketron (R-Murfreesboro), deputy speaker of the Senate and chair of the State and Local Government Committee, said the new rules have created an atmosphere of fear at the legislature. “It’s made us very paranoid to say anything to a lobbyist,” he said.

Mark Greene, considered the dean of Nashville lobbyists, represents several clients including the 250-member Tennessee Lobbyists Association. He said the new laws have not stopped lobbying — but they have made it more difficult. “Not being able to go out to dinner, it limits your access.”

Whether they like the tight rules or not, no one has any delusions about loosening them. If legislators did, they know voters would punish them at the polls.

“There’s no going back,” Todd said.

Not everyone joins in the insiders’ sense of loss.

Antoinette Lee, lobbyist for Tennessee Education Association, the main teachers’ group in the state, said her group never had much money to take people out to fancy meals.

“From my point of view, nothing’s really that different.” She said that meeting with legislators in their offices or grabbing them in the hallways has always been how she worked, since she couldn’t afford to take them on trips or out to expensive restaurants.

Anthony Nownes, an expert on lobbying and a political science professor at the University of Tennessee, said many professional lobbyists secretly like the new rules, because they don’t have to spend as much money pleasing legislators.

“The lobbyists are learning they can do it without all the gifts and schmoozing and partying,” he said. “The world did not stop turning. Things still got done.”

Georgia ethics reform

Proposed ethics reform bills in Georgia’s 2010 legislative session.

HB 920: Sponsored by Sandy Springs Republican Wendell Willard and more than 30 co-sponsors, the initial bill proposes that funds donated to specific political campaigns cannot later be transferred to other campaigns and used as a slush fund by politicians. It would cap lobbyist gifts to legislators at $100 annually. It would also prohibit members of the executive branch from becoming lobbyists for a full year after leaving their posts.

Status: Assigned to House Judiciary Committee. Sources in the Legislature say House Speaker David Ralston and his staff are considering transforming the bill to make it the vehicle for an overall ethics package. Any ethics bill has to take shape quickly to be passed this session.

HB 893: Would set up a process for independent review of complaints against elected officials.

Status: Assigned to House Judiciary Committee.