Report: Lax rules in U.S., Georgia lead to legislator conflicts

Sine Die in the Senate. BOB ANDRES / BANDRES@AJC.COM

Sine Die in the Senate. BOB ANDRES / BANDRES@AJC.COM

When a powerful state House leader pushed legislation to set a minimum commission for his industry, many of his colleagues didn’t think twice about backing the bill.

It eventually died on the final night of the session, and a senator told The Atlanta Journal-Constitution that it was “terrible legislation,” but it still made it through one chamber.

Such legislation is far from uncommon in Georgia, just as it is in states across the country.

A report by the Washington-based Center for Public Integrity and The Associated Press released Wednesday found numerous instances in which state lawmakers throughout the U. S. voted on bills that benefited their businesses, industries or personal finances.

Because legislatures set their own rules, those votes do not necessarily represent an official conflict, the report said. In some cases, lawmakers were cleared to vote even when a bill presented a clear conflict.

In Georgia, lawmakers pretty much decide what a conflict is — and isn’t.

The center produced a similar report 17 years ago analyzing thousands of disclosure reports that lawmakers throughout the country file showing their personal financial interests. In Georgia, those reports are filed annually with the state ethics commission.

That year, the report found that nearly 1 in 5 Georgia legislators served on a committee that regulated his or her personal business interest, a practice equally common in other states.

The Center for Public Integrity has done similar reports since then. Little, if anything, has changed.

Being a state lawmaker is a part-time job. State lawmakers in Georgia are paid $17,342 a year. When a commission recently recommended the pay be raised to nearly $30,000, the idea was quickly criticized.

Georgia’s part-time politicians are lawyers, pharmacists, engineers, insurance agents, consultants, doctors, retirees and funeral home directors the rest of the year. They bring their profession’s expertise, and sometimes their agenda, to the General Assembly when they come to the statehouse for legislative sessions.

It’s common for attorneys in the General Assembly to run committees deciding court and lawsuit issues, for insurance agents to pass insurance legislation, for lawmakers to think nothing of pushing legislation or seeking funding for their own industry.

Supporters of such citizen legislatures say they inject real-world experience into lawmaking and avoid turning the Capitol into a den of career full-time politicians

Georgia’s conflict of interest laws have traditionally been weak. Members can recuse themselves from voting on issues when they have a direct conflict. Some do, and many don’t.

Legislative rules — approved by members of the General Assembly — dictate that unless a bill solely benefits a member’s business, recusal isn’t necessary. So a lawmaker can sponsor a bill that helps his business, and those of others in his profession, and it would not be viewed as a conflict.

House Ethics Chairman Randy Nix, R-LaGrange, said in his 11 years in the House, he couldn't remember an instance in which he felt a lawmaker pushed legislation or tried to influence legislation narrowly drawn to directly benefit themselves or their business.

“Theoretically, all members are engaged in business or commerce for financial gain (to earn a living), so obviously there could be temptation to favor the industry or sector from which that gain is derived,” Nix said.

But he also noted that “very little is hidden” because reporters and others keep an eye on the General Assembly and voters get their say on lawmakers every two years. Georgia law also says a member of the public can file a conflict-of-interest complaint with Nix’s committee or its Senate counterpart.

“I can’t envision any system that would effectively eliminate the potential for conflict of interest,” Nix said.

Sara Henderson, the executive director of Common Cause Georgia, said conflicts of interest have been a long-standing problem in the General Assembly, as they have been in other states.

“While on paper there are a few rules that deal with ethics complaints and ethics issues, there is almost a complete lack of enforcement or desire to enforce these rules given the protectionist nature of the Legislature,” she said. “This is problematic in many fronts, ethics not being the least of these, but especially with regards to transparency.

“If my legislator has a personal business conflict, I would have no way of knowing that information unless I were there to ask the question directly to my legislator.”

The personal financial disclosure reports that lawmakers file can give the public a clue. On the forms they file, lawmakers generally list their profession and businesses they have a substantial ownership stake in, so, for instance, if a pharmacist files legislation that would help his or her pharmacy, it’s not particularly difficult to determine that fact using the reports.

One of the most high-profile cases came in 2016, when powerful House Rules Chairman John Meadows, R-Calhoun, was backing legislation to set a minimum commission when insurance agents sell health insurance. Meadows is an independent insurance agent who has long been licensed to sell health insurance.

The legislation failed in 2016, as did a follow-up attempt in 2017.

But that bill was far from the only case of legislation, or legislators, raising questions in the past few decades.

Back in the 1990s, when Democrats ran the General Assembly, a senator who lobbied for a major Georgia home health care company served on committees that regulated and helped fund his employer’s industry. Some legislative leaders ran companies that did business with the state while they helped decide the state budget.

A law quietly pushed by a leading lawmaker who also served as Gov. Sonny Perdue's lawyer on land deals provided the governor with a tax break in 2005. It was an issue that broke in the final months of Perdue's re-election campaign, but he was handily re-elected.

In 2009, The Atlanta Journal-Constitution reported that one House leader in the mobile home business was sponsoring legislation to prohibit communities from putting restrictions on modular homes, while another lawmaker who was the CEO of a private probation company filed legislation to limit oversight of the private probation business. The bills stalled or were withdrawn.

In 2012 when the Senate approved a bill long desired by the Georgia car dealers' lobby to phase out property taxes on automobiles, members joked during debate about how much it would help the car dealers serving in the chamber.

In 2014, the AJC reported that a lawmaker whose family was in the auction business sponsored legislation that might have forced cities, counties, sheriffs and businesses to hire licensed auctioneers when they sold inventory or property. The bill stalled.

Last year, state Sen. Ben Watson, R-Savannah, a doctor, was criticized for sponsoring legislation relaxing restrictions that prevent private practices from providing services, such as cancer treatments or types of outpatient surgeries, typically done in hospitals. Lifting the rules could allow multispecialty medical practices such as the one Watson co-founded to run profitable outpatient surgery centers.

Watson said at the time that it wasn’t a conflict of interest because, according to legislative rules, his business would not be the sole potential beneficiary. Nonetheless, his bills ran into strong opposition, and he decided not to keep pushing them during the 2017 session.

He did so, he said, because of uncertainty with federal health care law at the time.

Never miss a minute of what's happening in Georgia Politics. Subscribe to