HomeEssential Ethics / July 8, 2022

Essential Ethics

July 8, 2022

Latest Developments:

  • The Ninth Circuit Court of Appeals decided Butcher V Knudsenruling that Montana’s campaign finance restrictions are “unconstitutionally vague” as applied to the defendants. The case concerns two retired and politically involved men who ran a website that tracked Republican legislators’ voting records. When they were invited by Republican leaders to speak about their work and paid for their own travel expenses, the state’s “Commissioner of Political Practices determined that…[they] had formed a ‘political committee’ under Montana law” and subsequently imposed a civil fine. The Court found that the defendants “engaged in core political speech that lies at the heart of the First Amendment…[and that] insufficiently defined legal regimes can discourage valuable speech and invite unbalanced government regulation of less popular views.”
  • The State of New York, effective July 8th, has a new ethics agency, the Commission on Ethics and Lobbying in Government, which replaces the now defunct Joint Commission on Public Ethics (JCOPE). Part of a January 2022 budget bill formed the new commission, which seeks to avoid the pitfalls of the predecessor agency and provides that law school deans and other ethics experts attest to the integrity of commission appointees. As JD Supra reports, JCOPE was heavily panned as beholden to the officials who appointed them; the new commission seeks to address this criticism by reducing the number of appointees made by political officials and allowing the chair to be elected by commission members instead of “serv[ing] at the pleasure of the Governor.” Interestingly, “the new law does not alter, revoke, or rescind any regulations or advisory opinions issued by JCOPE that are currently in effect.”

In Case You Missed It:

  • IRS’s Non-Profit Expressway: The New York Times reports on a recently uncovered scam of fraudulent non-profit committees established and run by a convicted criminal. Prosecutors accuse Ian Hosang of embezzling
    “about $152,000 in donations that flowed through 23 of his nonprofits. 
    [Most problematically,] Mr. Hosang did not need to do much to promote the groups; the money came in through online giving platforms that let users choose among I.R.S.-approved charities.” That Hosang was sloppy makes the IRS oversights even more problematic. Analysts blame an expedited process the IRS implemented which streamlines approval and was meant to address persistent backlogs and accusations the agency was denying applications based on ideology. Indeed, under this process, “the denial rate for new charities — which had been as high as one in 53 applicants in the old system — fell to one in 2,400 in this one.”
  • Tart Orange County Cures: In the wake of the scandals plaguing Orange County and neighboring Anaheim, the county seat of Santa Ana is now considering a lobbyist registration and reporting ordinance of its own. The Los Angeles Times reports that the city “council unanimously gave initial approval to an ordinance that requires lobbyists to register with the city or face penalties… [arguing it will] ‘promote public confidence and trust, preserve the integrity of local government decision-making, and provide members of the community with access to information.’” While several steps remain until final passage, the mayor also commented that municipal campaign finance changes may be next.
  • JCOPE’s Coda: On the eve of its termination, New York’s now non-operational Joint Commission on Public Ethics released a report on the process leading up to its much-criticized approval of the former governor’s $5.1 million book contract. The report, according to local media, finds that the governor’s office exerted extreme pressure on JCOPE and that the agency “failed to assert itself as a watchdog agency against the Governor.” JCOPE revoked its approval for the book deal in November, after the governor left office. According to Politico, “the book deal became a priority in multiple investigations, including the Democratic-led Assembly impeachment inquiry that determined…[the former governor] used government resources to write it.”