Anyone else have their office included in the scope of this bill by your friendly neighborhood commissioners court?

HB 914 text

Ft. Bend article

Court approves all officials to be included in disclosure law

Ft. Bend Star
By Cheryl Skinner
March 3, 2006

Fort Bend County Commissioners voted to change the rules on who will be required to file disclosure documents under the new disclosure requirements of HB 914, which was recently passed by state legislators. The issue resurfaced two weeks ago when Precinct 3 Commissioner Andy Meyers suggested the court add all elected officials and department heads to the reporting requirements list. Originally the court opted to include the county judge, four commissioners and the county's purchasing agent. But last week, at the urging of Meyers, they added virtually all county officials.

The third time is usually a charm, or so the saying goes, and it certainly proved to be this time. Commissioners voted 3-2 to apply the oft controversial new public disclosure regulations to most elected county officials and department heads.

County Judge Bob Hebert joined Commissioner Meyers and Precinct 2 Commissioner Grady Prestage in voting to extend the law's provisions to about 40 officials and department heads. Precinct 1 Commissioner Tom Stavinoha and Precinct 4 Commissioner James Patterson voted against the measure.

Provisions of Chapter 176 of the Local Government Code, which are mandated by the recently passed House Bill 914 require officials under its authority to report gifts, taxable income from or business relationships between themselves or family members and any vendor doing business with the county. The new law also requires anyone bidding on a job as a vendor comply with the reporting regulations.

Meyers did extensive research after the first meeting resulted in the limited number of county officials having to adhere to the law and said he felt the "legislative intent" of the bill was to apply it to all elected officials and employees who in any way, deal with vendor contracts or agreements.

Hebert originally predicted that vendors would be less inclined to do business with governmental agencies because of the reporting requirements. "What they've done is create a quagmire for companies trying to do business with the state of Texas," Hebert said during the recent court session in which commissioners opted to limit the adherence to themselves, Hebert and the county's purchasing agent. "It is ridiculous on the face of it."

Hebert said last week, however, he learned that the reporting burden on vendors is not as extensive as he originally thought it was. Vendors have to disclose known relationships with county officials. However they do not have to report relationships with the officials' family members.

"There is nothing we can do under the law to give vendors any relief," Hebert said. "Therefore, I'm in support of Mr. Meyers' motion. I support the broadest application under the law."

"The first words out of (legislators') mouths were, 'this is not what we intended'" Patterson said of H.B. 914.

Meyers says he has never claimed that the new law wasn't flawed and mired with some loopholes that should be addressed. However, he felt, flawed or not, that the law was meant for all public officials. Stavinoha stuck to his guns and announced, "I'm going to vote against it."

Meyers countered saying the whole point of the law was to make sure government officials were accountable. "It's a bad bill," Stavinoha said.

Those now required to meet the mandatory conflict-of-interest reporting requirements of the law include the following officials and their department heads: County court-at-law judges; justices of the peace; associate judges; constables; sheriff; county clerk; district clerk; tax assessor/collector; treasurer; county attorney; auditor; IT director; director of administrative services; director of facilities & planning; road & bridge commissioner; director of health & human services; fire marshal; budget office; county engineer; director of parks; county librarian; elections administrator; and director of community development and the director of the county's drainage district.

The district attorney's office and the state district judges were not included in the list of those having to report. These offices are considered offices of the state.

The commissioners court's photo-op and sound bite here may make for the kind of publicity that is pleasing to those still angry about defeat of the tax caps in the last session, but it suffers from a flawed legal foundation. Specifically, chapter 176 itself applies only to a "local government officer," which is defined as either a member of the entity's governing board (i.e., a commissioner or the county judge) or someone designated as the executive officer of the local governmental entity. True enough, the statute does permit the commissioners court to extend reporting requirements to "all or a group of the employees of the local governmental entity," but the scope of that authority is most plausibly seen as defined by the subsection following the one that allows for sweeping county employees into the statute's reporting scheme. Section 176.005(b) provides that "[a] local governmental entity may reprimand, suspend, or terminate the employment of an employee who fails to comply with a requirement adopted under this section." As we are all aware, section 151.004 of the Local Government Code is interpreted to mean that the commissioners court (which is the body that acts for "the county") lacks hire-fire authority over employees of elected officials (to say nothing of the elected officials themselves, who are subject only to the "hire-fire" authority of the ballot box or article 5, section 24 of the constitution and chapter 87 of the Local Government Code). Thus, I think the commissioners court's authority to extend the reach of chapter 176 to all elected officials in the county is dubious. Our court has not tried to do so.

New law confusing officials

Conflict-of-interest reports may discourage business, some say

Friday, March 17, 2006
The Dallas Morning News


Local government officials and companies that do business with government say they want to comply with a new state law that requires the filing of conflict-of-interest reports.

But the new law is so confusing that officials are having a hard time figuring it out. They also worry that it may discourage companies from doing business with them.

The law, which took effect Jan. 1, requires officers of cities, school districts, counties, boards, commissions and other governmental entities to file conflict disclosure statements if they or family members receive taxable income or gifts totaling $250 or more from anyone who does business with that governmental entity.

Businesses also are required to report any business relationship with a governmental officer or family member of an official. The statements also are required of any company or individual seeking to do business with a local governmental entity.

"Pretty much any business, any law firm in the state, anybody that touches base with the city in any capacity, be it a pizza joint or a vendor, whoever it is, has to deal with this," Carrollton City Council member Matthew Marchant said.

"I think everybody wants to comply and is doing the best they can, but it is sort of difficult to figure out," he said.

The Texas Municipal League was the only group to voice opposition to the bill, passed in the waning days of the regular 2005 legislative session, said Frank Sturzl, the league's executive director. Now concerns are being raised in other sectors.

"The devil is always in the details," Mr. Sturzl said. "What ended up on the books is so unclear the sponsor has requested an attorney general's opinion to clear it up."

On Feb. 13, state Reps. Beverly Woolley, R-Houston, and John Smithee, R-Amarillo, sent a letter to the attorney general's office seeking interpretation of several terms in the legislation.

The letter was sent after concerns were raised by a school district and vendors who dealt with school districts, Mr. Smithee said.

"They wanted to comply with the law but didn't know how," he said.

Ms. Woolley, who helped write the legislation, did not return phone calls seeking comment.

The Texas Municipal League has interpreted the law to apply to anyone who does business with the city, from caterers and office supply vendors to banks, utility companies, architects and engineers.

"A more reasonable interpretation is that the bill only applies to large, written contracts. But the plain language of the bill does not unambiguously support that view," officials with the municipal league said in information distributed to cities.

A bank in West Texas has notified cities with which it has depository agreements that it will cancel those contracts rather than deal with the burden of reporting every account the bank has with City Council members, upper city management and their families, Mr. Sturzl said.

The banking community is worried because the bill forces them to reveal confidential information on such things as car loans, mortgages, savings accounts and mutual funds held by local government officials and their family members.

"For a smaller bank that doesn't have a lot of personnel, it could be a disincentive ... just because of the hours and the compliance cost to figure out each and every relationship the bank has with the school board or government entity," said John Heasley, executive vice president of the Texas Bankers Association.

Mr. Sturzl said he asked an executive for a major phone company if he thought any of the firm's employees served on local boards and commissions or were elected city, school or county officials.

"He said many of them," Mr. Sturzl said. "I said, 'If you also provide their phone service, there's a big paperwork problem waiting at the office for you. You better go back to the office and start filling these forms out.' "

Ms. Woolley also sought clarification on several other issues of the bill.

The intent of the legislation, she said in the letter to the attorney general's office, is to "increase transparency and accountability of government."

"I do find some humor in that the author of the bill is asking for some clarification," said Mark Hyatt, assistant superintendent of support services for the Carrollton-Farmers Branch school district.

The intent of the law, which also requires the reports to be made on a governmental entity's Web site, is good, he said.

"Anything we can do to reinforce the perception of the general public that we're all open and aboveboard is a good thing," Mr. Hyatt said. "But the bill is confusing and proven to be difficult to implement."

The law needs to be fixed in the next legislative session, Mr. Sturzl said.

"It's a question of what those fixes need to be," he said. "I think the intent is good. But I've been around long enough to know when you start writing these things, there are consequences you can't possibly imagine at the time, and that's what's happened."

Law requires officials to disclose gifts

By DAVE LIEBER
Ft. Worth Star-Telegram
Sun, Mar. 19, 2006

The link

Lanny Layman's wife gave him a suit for a Christmas present. Nothing unusual about that. "My wife gives me a gift every year on Christmas," the San Angelo school trustee says.

But this time the gift is noted on a new state form, the Local Government Officer Conflicts Disclosure Statement. I found it on the San Angelo school district's Web site, where news of the new suit is available to everyone.

Layman, the school board's president, is among the first officials in Texas to comply with a state law that took effect Jan. 1. The law requires many government officials to report whether they or their family members receive gifts or taxable income worth more than $250 from anyone who does business or wants to do business with their government.

The list of officials includes local and county elected officials, city managers, school board members, superintendents, and government board and commission members.

Transportation, food, entertainment and lodging expenses are exempt.

The law also requires all vendors who do business or want to do business with a government to file Conflict of Interest Questionnaires detailing family or business relationships with anyone in the government.

In Layman's case, his wife, Joni, sells cheerleading equipment to school districts. She sold less than $5,000 worth to her husband's school district, he says. But because the suit she gave him for Christmas was worth more than $250, he had to file under the new law.

"I personally think the rule is pretty silly," Lanny Layman says. "But I also want to be aboveboard for everything we do. I just thought the safest thing for me would be to go ahead and fill it out."

The new law is not widely known yet. The Watchdog checked several area governments last week and found that only a handful of the thousands of government vendors have filed the forms in area governments and school districts. Only a small number of area public officials have filed, too. But unlike vendors, officials must file only if they or their relatives receive income or gifts worth more than $250.

Still, the law's impact could be significant, especially for citizen watchdogs who want to make sure that their government officials make decisions about contracts on the merits, not because of personal gifts given to the decision makers.

Grapevine Mayor William D. Tate says: "This day and time, public officials have to be very careful. It didn't used to be that way. Even when I started in politics, people didn't pay much attention to this. But things have changed. To maintain the public trust, you're going to have to be very careful and discreet about what you do."

The law was introduced by state Rep. Beverly Woolley, R-Houston. Her bill passed the House last year by a 131-0 vote and the Senate by a 31-0 vote.

Woolley was unavailable for comment last week, but she once told the Houston Chronicle that she didn't think it was wrong for elected officials to have business interests. She said openness would counteract suspicions by the public that some deals are dirty.

The law requires forms to detail any gifts worth more than $250 given in a one-year period to an official or his or her spouse, children, parents or in-laws. Noncompliance could result in a $500 fine.

The forms must be made available to the public either on the Internet, for governments that serve large populations, or at the government offices.

Governments are allowed to void any contract if it is learned that a vendor or official required to file did not do so. Officials who do not comply can be reprimanded, suspended or terminated by their agency.

The law doesn't require an elected official to abstain from a vote on a contract in which there is a relationship with a vendor. The new requirement supplements existing state law that requires public officials to abstain from participating if they have a substantial interest in a business or real property under consideration.

One of the more intriguing aspects of the new law is that governments have the ability to expand its provisions beyond elected officials, city managers, superintendents, and board and commission members. By a vote of a school board, city council or county commissioners court, the provisions could be extended to include some or all of a governmental body's employees.

Tarrant County Commissioner Glen Whitley, who faces no Democratic challenger in his quest to become county judge next year, says: "I personally believe that we've got to make a decision to apply it to everyone in county government. For the most part, we're getting recommendations [on purchasing] from the staff. My thought is that it should go to basically everybody in the county."

Southlake Mayor Andy Wambsganss, who leads a city where two former employees were recently indicted on felony counts of misusing public funds, says: "I'd say go for everybody. It's just a matter of disclosure. I'd be all in favor of that."

In North Richland Hills, Tarrant County's third-largest city, spokeswoman Mary Edwards said last week that there are no plans to extend the provisions to city staff. She said city rules "adequately address this issue."

The city charter states, in language that is less restrictive than the new state law, that no elected or appointed officer or employee may "benefit unduly by reason of his holding public office." Officials are also not allowed to use their positions in a manner that would result in "financial betterment to any degree."

Across the region, filings have been sparse. Officials contacted last week say they are prepared to post the forms immediately on their official Web sites for all to see.

Arlington City Secretary Barbara Heptig says no vendors have filed yet. "I don't think they know about it," she says. "We're ready and waiting for them."

A handful of filings were posted on Fort Worth's Web site last week. Councilman Carter Burdette is among the first Tarrant County officials to file. He filed two forms.

One states that he has a relationship with the Cantey & Hanger law firm, where he is associated and also receives pension benefits and shares income from payments on fees he charges. Cantey & Hanger does legal work for the city.

In a second form, Burdette disclosed that his daughter-in-law works as a vice president for Centex Homes.

Burdette told me Friday that he knew of no specific contract that Centex has with the city, but he "decided to be on the safe side and list anything that might possibly fall in it."

Only eight vendors have filed with Fort Worth, and only one of those disclosed a relationship. Carter & Burgess, an engineering and architectural firm, reported that the husband of a company employee is an assistant flood-plain manager for the city.

In the months ahead, all vendors doing business or wanting to do business with governments will be expected to file forms.

Only government officials who have ties to those vendors are required to file.

Also, government leaders may or may not choose to extend provisions to more than those few top-level officials now covered under the new law.

Scott B. makes a compelling argument for limited application of this "remedial" statute. Our court never enjoys hearing the notion that their rules don't apply across the board to all county employees. Generally their arguments would go like this:

1. Section 155.001 of the Texas Government Code (TGC) uses the term "county employee." Are the benefits in that statute available to those not in the hire and fire range of Section 151.004 of the TGC? What about �county employees� in Section 173.001 of the TGC? Of course there are other statutes that specifically and ambiguously include all, namely, Section 157.101 of the TGC.

2. Since my county is covered by the Civil Service Statutes, Section 158.009 of the TGC governs whether an employee may be terminated. Since the rules adopted pursuant to this statute are arguably at odds with Section 176.005(b) of the TGC does 176.005(b) create an exception to the civil service rules of Section 158.009 of the TGC? Since exceptions of this nature are unusual the provisions are most likely in conflict and Section 158.009 of the TGC would control. On the other hand couldn't the Civil Service Commission by virtue of its authority impose the requirements implicit in Section 176.005(b) of TGC irrespective of its applicability otherwise?

3. Doesn�t the interpretation of Scott B. render the word �all� in Section 176.005(b) meaningless given its limited applicability when so interpreted? Doesn�t such an interpretation exclude the purchasing agent from the disclosures of Section 176.003 of the TGC? Isn�t the purchasing agent and his deputies the most logical persons to include within the scope of the disclosure requirement?

4. �Local government entity� means county in Section 176.001 of the TGC. Wouldn�t the argument of Scott B. be more compelling if local government entity meant Commissioners Court? Since the county may only act thru its officers, section 176.005(b) was merely put in the legislation to assure that whoever within the county might have such authority has the right to �reprimand, suspend, or terminate� the non-complying employee. Of course such an argument could apply with equal force to section 176.005(a) and conclude that the elected official not the Commissioners Court may exercise the authority granted in section 176.005 of the TGC. Such an argument makes section 176.005 circular indeed.

So, if you read this far you deserve answers, unfortunately there are no completely defensible answers regarding this statute.

Ray makes good points to counter my analysis. In response, I offer a couple of observations. First, thankfully, I don't have to worry about civil service in my county, so attempting to "harmonize" the two statutes is not an issue here. Second, the argument is correct about rendering "all" meaningless if you accept my reasoning. But going the other way and applying section 176.005(b) of the Local Government Code ubiquitously throughout the county would essentially render section 151.004 of the same code meaningless by granting de facto fire authority to the commissioners court through empowering them to create a category of offense for which the punishment must be termination, regardless of whether the offending employee works for an elected official and would otherwise be outside their employment decisionmaking reach. Moreover, if section 176.005(b) is read to encompass elected officials as "county employees," wouldn't its termination provision be unconstitutional under article 5, section 24 of the Texas Constitution?

From a practical standpoint, perhaps it sheds the salutary light of openness on local government if the citizens know how I meet my house payment and kids' expenses (I have to file a personal financial statement every year, anyway). But where is the practical use, other than increasing paper sales, in knowing the financial dealings of the men and women who mow our county roads or perform other non-policymaking work for the county? What if someone's spouse works in maitenance at Valero, and we buy our gas from Valero. In this case, it just means Valero is a big company and our employees are going to have to fill out more paperwork. Maybe it also means that spouses of our county employees are going to have a tougher time finding a job in the community, since some employers aren't going to want to hire the new disclosure requirement.

Finally, and perhaps most importantly, Ray correctly raises the most prominent county official outside the commissioners court who may be relevant to the statute's scope: the purchasing agent. But who generally hires and fires the purchasing agent? And are district judges going to willingly plunge themselves headlong into this morasse? In the end, Ray is absolutely right. If you're looking for real answers in the statute, you're going to be unsatisfied.

[This message was edited by Scott Brumley on 03-20-06 at .]

[This message was edited by Scott Brumley on 03-20-06 at .]

That must make you five times as productive as me. I suspect the desire to push this out on the employees is really a desire to push it out on the private sector and hence lead to the untimely demise of this statute.