Friday, March 19, 2010

Another model of economic disclosure

The Daily Herald has posted the questionnaire that the Democratic State Central Committee is using to vet potential nominees for the state's governor-in-waiting. It spans 45 questions.

Some of these questions are plainly there to address problems with the last nominee, Scott Lee Cohen, such as Question 14: "have you ever been accused of domestic violence?," and Question 16: "are you currently taking … performance enhancing substances?"

We're struck by how much more thorough this form is than the current Statement of Economic Interest. The Democratic State Central Committee is, of course, not a state agency, and is entitled to ask whatever questions they want of people seeking their nomination. But many of these questions are the same sort of thing that voters might want to know of all candidates, and the Statement of Economic Interest, which is the main tool for identifying potential conflicts of interest, is not nearly as thorough as this questionnaire is.

The SEI is only 8 questions and they are riddled with qualifiers, allowing most people who file the form to answer "No" or "Does not apply" to all of the questions. ICPR has found in previous reports that people who answer "No" or "Does not apply" on the state form often reveal more information when filling out the federal form (all candidates for federal office must fill out the federal form).

For instance, the first three questions on the SEI probe the filers' personal economic holdings. The first asks about ownership in "any entity doing business in the State of Illinois." The location ("in the state of Illinois") immediately limits answers, as do the following qualifiers: the ownership interest is over $5,000, or dividends exceed $1,200 during the previous calendar year. The second question asks about any professional organization in which the filer was an officer or partner and from which they earned more than $1,200, and the third question asks about professional services rendered by the filer that generated more than $5,000 in income.

By contrast, the Democratic State Central Committee questionnaire has more questions about personal finances, and these questions have fewer exclusions. One asks, "Please provide the names of any businesses, firms, partnerships, or holding companies which you own/owned or have/had an ownership interest in." Notice it has no exclusions for location or earnings, nor are there any time constraints. Another asks, "Do you own any real estate (commercial, residential, agricultural, or industrial)..." without income qualifications, and specifically asks for addresses "in Illinois, other states or foreign countries."

We don’t mean to say that the Democratic State Central Committee's questionnaire should be the new SEI. But we have long criticized the SEI for failing to capture all of the useful information that the public needs in order to identify conflicts of interest. In the past we have cited the federal Personal Financial Disclosure form as Exhibit A of how to write a better questionnaire, and now we can label this questionnaire as Exhibit B.

The Daily Herald did not indicate whether potential Lt. Gov. nominees were also being asked to fill out Illinois' Statement of Economic Interest. (If nominated, they will have to do so by state law.) ICPR believes that the SEI needs to be improved, and this questionnaire suggests good ways of doing so.

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