Making Michigan a Leader in Government Ethics

1. Making Michigan a Leader in Government Ethics Attorney General Mike Cox Representative Paul Opsommer Senator Bruce Patterson Making Michigan a Leader in Government Ethics

2. Michigan is struggling under the weight of a poor national image on ethics • Michigan needs a solid foundation of government ethics as part of its comeback. • To attract a high-skilled work force and new jobs, we must instill confidence that Michigan government is transparent and ethical. Making Michigan a Leader in Government Ethics

3. Where does Michigan Stand? • DEAD LAST nationally on financial disclosure.1 • Michigan is one of only 3 states with no financial disclosure law. • No reporting of lobbyist provided gifts received by public officials or their immediate family members. • Law does not require legislators to abstain from voting when conflicts of interest appear. 1 - Per Center for Public Integrity Making Michigan a Leader in Government Ethics

4. What Are Innovative States Doing? • Louisiana had a poor national reputation on ethics. • But, Gov. Bobby Jindal held a special legislative session in 2008 to improve transparency and ethics.2 • New disclosure requirements moved Louisiana from bottom of ethics rankings to the top this year. • Jindal says that strengthening ethics laws will help Louisiana attract investment and jobs – and he’s right. 2 2 - Per Center for Public Integrity Making Michigan a Leader in Government Ethics

5. What People Say About Michigan’s Need for Reform • “Personal financial disclosure allows citizens to have confidence that their elected representatives are serving the public interest, rather than their own financial well-being.” • Rich Robinson, Michigan Campaign Finance Network • “…allow voters to come to their own conclusions about the interests lawmakers, statewide officials or local officials may serve once in office.” • Detroit News Editorial Board • “Well, there we are again. Dead last.” • Ron Dzwonkowski, Detroit Free Press Making Michigan a Leader in Government Ethics

6. What Have We Done So Far? • The Attorney General’s office was first in the state to place all spending, travel and contracts online in 2008 and settlements online in 2009. • www.michigan.gov/trackyourtaxes • www.michigan.gov/settlementcenter • Traveled to all regions of the state advocating for transparency. • Now it is time for the next step. Making Michigan a Leader in Government Ethics

7. Make Michigan a Leader in Ethics • Create first-ever financial disclosure law for public officials, their families and candidates. • Report of gifts and travel from lobbyists. • Report large loans, income, assets and transactions. • Establish low thresholds to ensure transparency. • Create serious penalties for not following the law. • Require candidates for governor to release last three tax returns. • Put legislative conflict of interest disclosure in statute. Making Michigan a Leader in Government Ethics

8. Financial Disclosure Plan Making Michigan a Leader in Government Ethics

9. Financial Disclosure Plan • Who would be required to disclose? • State officials: Governor, Lt. Governor, Attorney General, Secretary of State, State Boards of Education, Department Directors, Legislators and Supreme Court Justices. • Local elected officials who earn more than $65,000. (i.e. mayors, county executives and commissioners) • Candidates for any of the above. Making Michigan a Leader in Government Ethics

10. Gift and Travel Reporting • Gifts must be reported when annual aggregate value exceeds $250 per lobbyist. • Closes the immediate family loophole. • Current lobby law requires NO reporting below $56 per month, per lobbyist and has NO limits for family gifting. • Travel and other reimbursements reported when annual aggregate value exceeds $250 per lobbyist. • Closes the immediate family loophole. • Current lobby law requires reporting after $725. Making Michigan a Leader in Government Ethics

11. Putting Teeth in the Process • Secretary of State administers and maintains website. • SOS investigates and has administrative subpoena power; Attorney General prosecutes. • Failure to file truthful and timely information could result in criminal charges: • 30 days past due or knowingly inaccurate: $5,000 late fee. • Fail to file two reports: misdemeanor, one year and/or $2,000. • Fail to file three or more reports: felony, four years and/or $10,000. Making Michigan a Leader in Government Ethics

12. Clarifying Legislative Conflicts of Interest • Prohibit legislators from voting when there is a conflict of interest. • In the last six-and-a-half years, few have abstained: • House: 33 times in 6,495 votes. 3 Senate: Zero times in 5,382 votes. 4 • House and Senate Rules do not Match; House rules are not as strong as the Senate. • "If a member desires to abstain from voting because of a potential conflict of interest, the Member may rise…" • Requires disclosure prior to abstaining from voting. • Definition expanded to include business associates, in addition to immediate family. • Requires creation of enforcement rules. 3 – Per House Journals, 2003-2009 4 – Per Senate Journals, 2003-2009 Making Michigan a Leader in Government Ethics

13. Make Michigan a Leader in Ethics • Report lobbyist gifts for officials, candidates and family. • Disclosure of personal finances. • Abstain from voting when conflicts of interest occur. Making Michigan a Leader in Government Ethics