There’s an old adage that there are certain topics that are better left off the table. This includes sex, religion and politics.
Money is often involved, but money is something that needs to be talked about a lot – especially in politics and government.
This year, bills before the Hawaii Legislature prohibit the public from learning from a variety of sources about compensation paid to board members and commissions. The main argument is that sharing financial information on financial disclosure forms deters many people who might otherwise be willing to volunteer for government service.
Two bills propose that the Hawaii State Ethics Committee redact ranges of monetary amounts. As the legislature explains — both House Bill 1849 and Senate Bill 2123, introduced by the Speaker of the House and the Senate Speaker from unidentified parties — “the community members most qualified for the service are often unwilling to To seek seats on government bodies or commissions due to the requirement to publicly disclose financial information. These individuals and their companies often value privacy in relation to compensation.”
Eliminating this requirement, the legislation said, would “increase the size and quality of the candidate pool” and thus benefit Hawaii.
In fact, blacking out dollar ranges — say, $50,000 but less than $100,000 — would only cast doubt on the sincerity and interests of candidates to serve on more than a dozen state boards, commissions, and agencies.
These include the University of Hawaii Board of Regents, the Board of Land and Natural Resources, the Land Use Commission, the Board of Agriculture, the Hawaii Community Development Authority, the Hawaiian Homes Commission, and a dozen other boards, commissions, and agencies as well as the State Ethics Committee itself, the body responsible for documenting the disclosures and posting them on the Internet.
These bodies make important decisions that greatly influence the direction of state policy and affect almost everyone in Hawaii. They also involve a lot of public money.
Testimony against HB 1849, heard last week, made all too clear why the proposed legislative change is a step “in the wrong direction,” as Ethics Committee Executive Director Robert Harris wrote:
“Reducing public transparency in this way weakens public confidence in the actions of these individuals and their respective boards and commissions, which is contrary to the purpose of state ethics laws. Furthermore, without knowing the level of financial interests of a director or commissioner, a public interest representative could not reasonably assess the potential for a conflict of interest.”
Sandy Ma, executive director of Common Cause Hawaii, testified, “Redacting information for financial disclosure serves no good government purpose, especially when many unpaid volunteer bodies wield tremendous power.”
Douglas Meller of the League of Women Voters of Hawaii Legislative Committee pointed out that these same board members “may authorize the private use of public property or allocate public funds for private purposes.”
One down, one to go
On Friday, HB 1849 was postponed indefinitely in the House of Representatives, but that doesn’t end the chances of the bill passing. Rep. Angus McKelvey, who chairs the House Government’s Reform Committee, noted that the Senate peer “has fewer committees” – suggesting it might be easier to move forward.
SB 2123 is now awaiting a hearing in this chamber, and there may well be one, as the proposal has many influential proponents.
Testimony in support of the House version included Land Use Commission Executive Officer Daniel Orodenker; Christian Fern, executive director of the University of Hawaii Executive Assembly; Tim Dolan, Vice President of UH and CEO of the UH Foundation; and Department of Transportation Director Jade Butay.
“We must take steps to increase the pool of qualified candidates willing to volunteer to serve on boards and commissions, and changing – but not eliminating – financial disclosure is an important step that could help,” Randy wrote Perreira, executive director of the Hawaii Government Employees Association.
The desire to change financial disclosure requirements did not arise in a vacuum. David Lassner, the President of UH, stated in supporting testimony that in 2014 UH strongly opposed legislation that made financial information of members of the Board of Regents publicly available.
“Four incumbent regents resigned when the legislature changed the terms of their public service,” he wrote. “They had submitted their financial statements for ethics review, but were unwilling to compromise their privacy and that of their families. In the years since then we have seen a declining number of applications from individuals willing and interested to serve as Regents.”
In addition to the four regents, members of the LUC, the ADC, the BLNR and the Board of Directors of the Hawaii Housing Finance and Development Corporation also resigned.
Then Governor Neil Abercrombie, who had his own strange reasons for opposing the 2014 law – he claimed it would harm women and discourage their government service – allowed it to become law without his signature.
This isn’t the first time lawmakers have toyed with tinkering with the law, either. In 2018, there was a move to water down financial disclosures, for the same stupid reasons. The Senate version made it to the conference committee before dying.
The Senate should act
Today, based on the statements filed for HB 1849, a large number of private sector executives also want to keep financial figures secret.
Among them are Michael Pietsch, President of Title Guaranty of Hawaii; Ed Schultz, President and CEO of Hawaiian Host Group; Josh Feldman, President and CEO of Tori Richard; Emily Porter, COO at MacNaughton; Paul Yonamine, Chairman of the Central Pacific Bank; John Morgan, President of Kualoa Ranch; Kris Nakagawa, vice president at Young Brothers; Sean M. Nakamura, corporate controller and treasurer at Island Holdings; Meli James, President of the Hawaii Venture Capital Association; and Chuck Bergson, President and CEO of Pacific Media Group.
“By removing irrelevant personally identifiable information from publication — information not relevant to assessing a board member’s conflict — we believe the state will attract the right people willing to serve our state on a board or commission serve by giving their time, skills and wisdom,” said Brandon Kurisu, president of the University of Hawaii Alumni Association.
It is encouraging to see leaders from such a broad and respected group of Hawaiian businesses and organizations seeking to improve government service. But their many rationalizations are weak and sometimes just plain wrong.
Brian Black, executive director of the Civil Beat Law Center for the Public, drilled a big hole in one of HB 1849’s main arguments: “None of the 17 relevant bodies has more than one vacancy at this time. In contrast, other government bodies and commissions — whose members’ financial disclosure statements are not publicly released — have several long-standing vacancies.”
In fact, Black says, there are “many” qualified individuals in the state who will not be dissuaded from making their conflicts of interest public. If someone isn’t willing to be transparent, he adds, “that person may not be the best person to represent the people of Hawaii on a civilian oversight board.”
Lawmakers shouldn’t try to fix something that isn’t broken.
Click the links to contact the following Senate Chairmen and ask them to remove SB 2123: Sharon Moriwaki on Government Operations, Karl Rhoads on Judiciary, and Donovan Dela Cruz on Ways and Means.
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