Cruel to be Kind: Report cites "Minnesota Nice" in Minnesota and Wisconsin's failures of government transparency

October 25, 2016

 

Robert Kosuth
Zenith News

We may just be too nice for our own good. Minnesota and Wisconsin’s “squeaky clean image hides a nest of ethical problems,” reads the subtitle of a 2015 study of government transparency by the Center for Public Integrity.


The non-partisan, non-profit investigative research agency gave Minnesota a D-minus overall, with failing grades for public access to information, executive, legislative, and judicial accountability, ethics enforcement, and pension fund management.


Wisconsin fared no better, scoring a D overall, with failing marks in public access to information, political financing, legislative and judicial accountability, civil service management, and lobbying disclosure.


Katie Nelson, a former capitol correspondent for the Mesabi Daily News in Virginia who authored the transparency study, partially lays the blame on “Minnesota Nice”—the tendency among upper-Midwesterners to avoid confrontation, to regard direct criticism as impolite, and to be reserved and self-effacing.


“Minnesotans trust each other. There’s a sense...that people will act ethically and morally, and you trust that your politicians will do that, too. But when it came down to actually having laws and legislation that have some teeth, in terms of monitoring ethical blunders, they really didn’t exist.”


Nelson found that the lack of splashy scandals in Minnesota and Wisconsin hides a steady drip of ethically dubious behavior. “I knew that politicians were doing a lot of behind-closed-doors discussions and…unless there’s a quorum, they can do that by law. But I didn’t realize that it was so frequent, that many people were just meeting after work or late into the night and then having these very, very significant conversations about legislation.


“As a journalist I know this happened many times. You’d leave the capitol; you’d go to bed like 10 o’clock. You’d get back at 7 o’clock in the morning, and a bill had completely changed. How is this possible in the hours that I was gone?...Because people can meet legally after hours and it doesn’t have to be open to the public.”


The Minnesota Data Practices Act and Open Meeting Law are intended to make government documents and meetings more transparent, but they’re filled with so much exception and ambiguity that government officials can easily get around them. “Minnesota’s legislative branch is not required to adhere to the state’s government Data Practices Act...Instead the state House and Senate have their own set of rules governing how and when they give public access to their meetings and documents.”


This led to what Nelson views as one of the most egregious examples of government secrecy in recent Minnesota history: A 3 a.m. hallway meeting of senators from both parties, angling to remove local audits from the State Auditor’s Office and hire private auditors instead.  


After the measure passed in 2015, two unnamed senators told the Star Tribune that Republican House Speaker Kurt Daudt and DFL Senate Majority Leader Tom Bakk cut the deal and then pressured the other senators at the secret meeting to approve it. Dayton signed the bill, leading to speculation that he was in on it, too.


State Auditor Rebecca Otto had fallen out of favor with both parties after she voted against issuing leases for PolyMet’s copper mine, citing concern that the company’s financial assurances were inadequate to protect taxpayers from cleanup costs. “She was completely blindsided by that decision,” says Nelson. “She was trusting that her party [the DFL] was going to take care of her and, in the middle of the night, they made a decision...I think this kind of thing happens quite a bit.”


To come up with their grades, the Center for Public Integrity subjected all 50 states to a double-blind peer review of 13 major categories, broken down into 92 legal indicators and 153 indicators of how those legal criteria are implemented. Online, each criterion is accompanied by a drop-down explanation. The category of “Ethics Enforcement,” for example, includes such questions as, “Are there laws and regulations to promote and protect a professional ethics enforcement agency (or set of agencies)?” and “Can Citizens access...ethics entities reports?”

 

“Everything is measured in a quantitative kind of way,” says Nelson. “So you can track money, you can track bills to a certain extent, whatever. But the qualitative kind of analysis of power, privilege, and all that kind of stuff, obviously it isn’t evaluated at all. There are definitely examples of people getting both financial benefits as well as political or power benefits at the capitol.”


Wisconsin earned a slightly higher ethics grade, mostly because Minnesota has no centralized agency to enforce ethics rules. Wisconsin used to have the Government Accountability Board, comprised of six retired judges appointed by the governor and confirmed by the legislature.


But the Government Accountability Board was successfully destroyed by state Republicans after a 2012 investigation into Governor Scott Walker’s relationship with independent political groups. Coordination with independent groups can violate campaign finance laws by effectively allowing the candidate to raise and spend unlimited sums of money. But the specific laws regarding coordination vary widely from state to state. 

 
For the next three years, the Republican-controlled legislature cut funding for the Government Accountability Board, decried the investigation as a partisan witch-hunt, and called on unsympathetic board members to recuse themselves. (Even if it were a conflict of interest, there was no mechanism for members to recuse themselves.)


The case went to the Wisconsin Supreme Court, which ruled in Walker’s favor, calling the state’s campaign finance laws “unconstitutionally overbroad and vague.” Last November, the state legislature voted to abolish the Government Accountability Board.


Minnesota’s loose equivalent, the Campaign Finance and Public Disclosure Board, lacks independence, authority, adequate staff and funding. The Center for Public Integrity calls it “one of the weakest ethics boards in the country...and the legislature loves it that way.”


In 2015, DFL Senator Dave Tomassoni accepted a lobbying position with the Range Association of Municipalities and Schools. Republicans filed a complaint with the Campaign Finance and Disclosure Board, which ruled that Tomassoni should simply monitor himself.


Leaving the fox to guard the henhouse is standard operating procedure for the Campaign Finance and Public Disclosure Board. The Board is not audited, trusting officials to disclose on the honor system. The Board’s reports are, technically, public, but they can’t be downloaded online and are “challenging” for citizens to obtain.


Since 2002, 60 former legislators have become lobbyists, some within days of leaving office, but the “revolving door” between legislator and lobbyist is almost unregulated in Minnesota and Wisconsin.


Minnesota law and Senate rules say nothing about this practice. A House rule requiring legislators to wait one year before becoming lobbyists is routinely ignored without consequence. Former DFL Senator Roger Moe became a lobbyist after losing the governor’s race to Tim Pawlenty. He now represents 3M, Delta Airlines, and the Mall of America (among others), referring to his new arrangement as “having some hay in the barn.”


Minnesota is one of only four states where the amount lobbyists spend to influence lawmakers topped $100 million in 2013-14. In Wisconsin, lobbyist spending has doubled in the last 10 years, now reaching $50 million. On the bright side, Minnesota and Wisconsin are two of only 28 states that even make this information public at all.


Unlike Minnesota, Wisconsin requires lobbyists and the organizations they represent to report after only five conversations with lawmakers. The report must include the position they are endorsing. However, individual lobbyists are not required to file spending reports or disclose how much they get paid. The Government Accountability Board used to audit lobbyist reports, but did not publish its findings, and the Legislative Audit Bureau has insufficient information to take over this task.


The widest grade disparity between the two states is in Pension Fund Management—the Center for Public Integrity gave Wisconsin a C-minus and Minnesota an F.


The Minnesota State Board of Investment controls all assets in the State Pension Fund. The Board contracts with independent agents at various firms to manage those assets, but the independent agents are not required to register nor disclose their fees or terms of service.


By contrast, the Wisconsin Investment Board has a policy against hiring “placement agents”—essentially brokers who look for favorable investments. Minnesota’s looser policy means private investment managers might be hiring placement agents, but since they’re not required to register, the public can’t find out or evaluate the terms of their contracts. Since 2006, Wisconsin has reduced its reliance on external managers and now handles 56.8 percent of its own state retirement assets. Wisconsin’s 10-member Board is appointed by the governor with approval by the legislature. Members must have 10 years investment experience and serve six-year terms. The executive director is chosen by the Board.


In Minnesota, the State Board of Investment always consists of the same four elected officials—the governor, the secretary of state, the attorney general, and the state auditor. They appoint the investment staff (11 members), the executive director, and the advisory council (17 members), only four of whom are ex officio and three are appointed by the governor alone. They need only two years investment experience and serve indefinite terms.


The Center for Public Integrity notes that while “there are no documented cases of political interference...it is clear that many of the council members are involved in highly political positions within state government.”


As with lawmakers-turned-lobbyists, the revolving door into the private sector is an issue for state boards of investment. Wisconsin has a “cooling off” period of one year before getting involved with private sector interests that were under the official’s purview, and a permanent ban on interests for which the official was personally responsible. Minnesota has no cooling off period at all.


One aspect of government not examined by the Center for Public Integrity is travel not paid for by public funds—perhaps because it remains so non-transparent that the best way to know where your legislators are and why is to check their Facebook and Twitter accounts.


Lobbyists are not permitted to pay for travel, but there is no Minnesota requirement that legislators disclose travel or its funding sources—not even if the trip is clearly business-related. Besides, even if lobbyists can’t foot the bill (not that we’d know about it if they did), that doesn’t mean lobbyists can’t exert influence.  


The result is a long list of suspiciously off-the-record peripatetics. Minnesota House Speaker Kurt Daudt, Representative Ron Kresha, and Representative Paul Rosenthal spent nine days in Turkey last year, sponsored by the Niagara Foundation, whose “honorary president” is wanted for extradition by Turkey on terrorism charges.


In January, six legislators took a highly secretive trip to Israel. The names of the legislators and the trip’s funding source(s) have not been disclosed (although Daudt appears to have been one of the participants, based on a news report at the time that referenced his return).


Senator Dan Hall also took a trip to Israel in August 2014, sponsored by the American Israel Education Foundation. Hall later joined Daudt as a signatory on a letter denouncing Students for Justice in Palestine.


Attempts to legislate more transparency have been rare and ineffective. During Minnesota’s 2016 legislative session, Representative Paul Thissen introduced proposals to open up committee meetings, supply 24-hour public notice before final votes, limit the revolving door of lobbyists, and apply the Data Practices Act to the House.  


Michael Howard, Communications Director for the DFL Caucus, said that if the DFL wins a majority in the upcoming election, they “will make legislative transparency a priority to fix these problems.” To which House Speaker Kurt Daudt retorted, “When he was Speaker of the House, he didn’t do any of this.”


Currently, cross-party accusations are the surest way of initiating an investigation—but also the most self-serving and the public quickly tires of partisan rancor. “Both Democrats and Republicans are very guilty of using the process to their advantage,” says Nelson.


“They go to the Campaign Finance Board and that’s how they get most of these violations processed, which is problematic. Why aren’t you investigating these from the beginning or doing random audits? But they just don’t have the funding for it.”


This is what democracy looks like and it’s not a pretty picture. “It is a very intimidating process...The Iron Range politicians were open to talking with the public. Whether or not that translates into getting legislation actually pushed through, that’s a whole other idea...There’s the issue of political financing and what issues are brought to the forefront, how heavy these lobbyists are lobbying...I felt that individually if you had a small bill or a small suggestion, people would listen, but political financing is a beast, so it kind of depends on the issue.”

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