Hawaii has laws on the books that are supposed to protect against conflicts of interest by state lawmakers. But those rules aren’t actually effective in practice, according to the State Integrity Investigation.

The state earns 0 percent scores in two categories: First for lacking an anti-nepotism, cronyism and patronage law, and second because the state permits legislators to hold private sector positions while in office.

The state got a C-, or 71 percent, grade for Legislative Accountability. Leading the pack was Tennessee. Hawaii tied for 14th with New Hampshire, Kentucky and West Virginia. Maine came in last.

Overall, the State Integrity Investigation ranked Hawaii 10th after Civil Beat reporters researched 330 “Corruption Risk Indicators” across 14 categories of government. (Click here to learn more about the methodology used for the project.)

Hawaii earned 75 percent score in yesterday’s “in law” evaluation of conflict of interest rules. But the state gets a dismal 33 percent for their effectiveness.

Bottom line: Hawaii lawmakers’ lax adherence to gift and hospitality rules sunk the state’s score. Legislators also killed several recent efforts to pass cronyism and nepotism laws.

Here’s the basis for the C- grade. Each day we’ll print a different question and the criteria used to come up with a grade for each question. It’s your turn to evaluate whether Civil Beat got it right and to share what you think should be done to improve the situation. Share your comments at the bottom of this story.

Here’s the third of five questions the State Integrity Investigation asked about Legislative Accountability.

Are regulations governing conflicts of interest by members of the state legislature effective?

Overall score: 33%

Here are the criteria Civil Beat used to answer that question and what we found.

1. In practice, the regulations restricting post-government private sector employment for state legislators are effective.

Notes: State lawmakers are prohibited from representing any person or business on matters they previously participated on. However, the restriction is within 12 months of their termination. It is generally followed, but the restriction needs to be longer, said state Sen. Les Ihara. Political blogger Ian Lind said when people leave state service they are told about post-employment restrictions. There aren’t a lot of complaints people hear about, he said. Still, there are past media reports of state lawmakers working as lobbyists after leaving office. The Honolulu Star-Bulletin reported former state Rep. Ken Hiraki and House Consumer Protection chairman resigned in 2005 to join Hawaiian Telcom as a lobbyist. State Rep. Paul Oshiro and House Judicial panel chair also stepped down in 1999 to be a lobbyist for GTE Hawaiian Tel, according to the Honolulu Star-Bulletin. However, Oshiro now works as government relations manager for Alexander & Baldwin, according to a Honolulu Star-Bulletin brief. Former state Sen. David Ige also resigned in 1998 to join a technology start-up company and received criticism for potential conflicts of interests as an Education Technology chair, according to the Honolulu Star-Bulletin.

Hawaii legislators are also permitted to hold private sector positions while in office, reports Honolulu Civil Beat. In at least one case, a state lawmaker worked as a lobbyist while in office: Rep. Joe Souki, a Wailuku Democrat and speaker of the Hawaii House from 1993 to 1998, has for at least the last 18 months worked for the American Chemistry Council, an industry association that speaks for chemical companies. He’s represented the organization before the Maui County Council, specifically regarding a bill that would have prohibited the use of disposable polystyrene food service containers by food providers in the County of Maui.

Sources:

• Les Ihara, state Senator, 9/21/11, interview at Civil Beat office.

• Ian Lind, former newspaper journalist, former legislative staffer and former executive director of Common Cause Hawaii, 9/21/11, telephone interview.

• Honolulu Civil Beat, Michael Levine, 6/2/11, “No Conflict: Lawmaker by Day, Lobbyist by Night”

• Honolulu Star-Bulletin, Richard Borreca, 8/27/05, “Lingle’s pick has criminal record”

• Honolulu Star-Bulletin, Craig Gima, 10/27/99, “Head of House Judiciary panel to step down”

• Honolulu Star-Bulletin, staff, 7/1/05, “[Hawaii Inc.]”

Score: 0%

Scoring criteria: These are the scoring criteria for this question.
Very Strong: The regulations restricting post-government private sector employment for state legislators are uniformly enforced. There are no known cases of legislators taking jobs in the private sector after leaving government where they directly lobby or seek to influence their former government colleagues without an adequate cooling off period.
Fair: The regulations are generally enforced though some exceptions exist. In certain sectors, legislators are known to sometimes take jobs in the private sector that entail directly lobbying or seeking to influence their former government colleagues. Cooling off periods are short and sometimes ignored.
Very Weak: The regulations are rarely or never enforced. Legislators routinely take jobs in the private sector following government employment that involve direct lobbying or influencing of former government colleagues. Cooling off periods are non-existent or never enforced. A ZERO score is also earned if legislators are allowed to hold private sector positions while in office.

2. In practice, the regulations governing gifts and hospitality offered to state legislators are effective.

Notes: State law requires state lawmakers to disclose any gift or gifts exceeding $200 value from one source. Some state legislators have disclosed gifts under $200 and others have omitted details. Hawaii lawmakers have accepted expensive gifts such as an iPad valued at $500 and gifts of lesser value such as $1 li hing mui seeds, according to Honolulu Civil Beat. State lawmakers are not allowed to accept gifts meant to influence or reward them. However, some lawmakers have accepted gifts such as Blu-ray DVDs from a media company seeking more generous tax credits for filming in Hawaii. One lawmaker’s reasoning for accepting the gift was that it was a good gesture. In September 2011, Honolulu Civil Beat reported that two dozen of those DVD sets from Relativity Media were not disclosed by lawmakers. State lawmakers have also accepted gifts, such as paid trips from Taipei Economic and Cultural Office, Women in Government, Hawaii Tourism Authority and University of Virginia. All information above collected from Honolulu Civil Beat reports.

Sources:

• Honolulu Civil Beat, Nanea Kalani, 7/11/11, “Hawaii Lawmakers Accept More Than $137,000 in Gifts”

• Honolulu Civil Beat, Nanea Kalani, 7/12/11, “iPad, DVDs Among Gifts From Film Studio to Hawaii Lawmakers”

• Honolulu Civil Beat, Sara Lin, 7/21/11, “Hawaii Ethics Director: Lawmakers ‘Pushed’ the Line on Gifts”

• Honolulu Civil Beat, Nanea Kalani, 9/8/11, “2 Dozen DVD Gifts to Hawaii Lawmakers Unaccounted For”

Score: 25%

Scoring criteria: These are the scoring criteria for this question.
Very Strong: The regulations governing gifts and hospitality to state legislators are regularly enforced. Legislators never or rarely accept gifts or hospitality above what is allowed.
Fair: The regulations governing gifts and hospitality to state legislators are generally applied though exceptions exist. Some legislators in certain sectors (e.g. transportation, healthcare) are known to accept greater amounts of gifts and hospitality from outside interest groups or private sector actors than is allowed.
Very Weak: The regulations governing gifts and hospitality for state legislators are routinely ignored and unenforced. Legislators routinely accept significant amounts of gifts and hospitality from outside interest groups and actors seeking to influence their decisions

3. In practice, state legislative branch asset disclosures are audited.

Notes: State legislative financial disclosures are not audited, according to state Sen. Les Ihara. According to political blogger Ian Lind the State Ethics Commission does not routinely audit any financial disclosures. They used to do random audits, but they stopped doing that when the budget grew tight, Lind said.

The Hawaii State Ethics Commission does not do routine audits of financial disclosures, according to executive director Les Kondo. But reviews are done if the Ethics Commission is made aware of any inaccuracies or irregularities. For example, the Ethics Commission reviewed the financial disclosures of state Sen. Clayton Hee after Ian Lind reported on his blog that Hee filed incomplete and false reports. The Commission followed up with an informal advisory opinion, prompting Hee to amend his reports after the fact.

Sources:

• Les Ihara, state Senator, 9/21/11, interview at Civil Beat office.

• Ian Lind, former newspaper journalist, former legislative staffer and former executive director of Common Cause Hawaii, 9/21/11, telephone interview.

• Les Kondo, executive director, Hawaii State Ethics Commission, 10/7/11, telephone interview.

• iLind.net, Ian Lind, 10/22/11, “Senator Hee escapes ethics penalties despite commission concerns”

Score: 50%

Scoring criteria: These are the scoring criteria for this question.
Very Strong: Legislative branch asset disclosures are regularly audited using generally accepted auditing practices.
Fair: Legislative branch asset disclosures are audited, but audits are limited in some way, such as using inadequate auditing standards or the presence of exceptions to disclosed assets.
Very Weak: Legislative branch asset disclosures are not audited, or the audits performed have no value. Audits may be performed by entities known to be partisan or biased in their practices.

4. In law, there are restrictions on legislators setting up non-profit organizations (e.g. community groups, think tanks) that can be used to reward political supporters and/or evade campaign finance rules.

Notes: There is no flat out prohibition for elected officials in setting up a nonprofit, according to Hugh Jones, supervising deputy Attorney General – Tax Division in Hawaii. He said fair treatment rules would apply in this case.

Hawaii Revised Statutes, Chapter 84 Standards of Conduct, Part II. Code of Ethics, §84-13 Fair treatment. Visit http://capitol.hawaii.gov/hrscurrent/Vol02_Ch0046-0115/HRS0084/HRS_0084-0013.htm for details.

Sources: There is no flat out prohibition for elected officials in setting up a nonprofit, according to Hugh Jones, supervising deputy Attorney General – Tax Division in Hawaii. He said fair treatment rules would apply in this case.

Hawaii Revised Statutes, Chapter 84 Standards of Conduct, Part II. Code of Ethics, §84-13 Fair treatment. Visit http://capitol.hawaii.gov/hrscurrent/Vol02_Ch0046-0115/HRS0084/HRS_0084-0013.htm for details.

Score: 100%

Scoring criteria: These are the scoring criteria for this question.
Yes: A YES score is earned if there are regulations restricting legislators’ ability to create third-party organizations that could be used to reward political supporters and/or evade campaign finance rules.
No: A NO score is earned if no such restrictions exist.

5. In law, there are regulations to prevent nepotism (favorable treatment of family members), cronyism (favorable treatment of friends and colleagues), and patronage (favorable treatment of those who reward their superiors) in the hiring of legislative staff.

Notes: There is currently no law that addresses nepotism, but the fair treatment and conflict of interests laws may apply in certain cases.

Hawaii Revised Statutes, Chapter 84 Standards of Conduct, Part II. Code of Ethics, §84-13 Fair treatment. Visit http://capitol.hawaii.gov/hrscurrent/Vol02_Ch0046-0115/HRS0084/HRS_0084-0013.htm for details.

Also see §84-14 Conflicts of interests. Visit http://www.capitol.hawaii.gov/hrscurrent/Vol02_Ch0046-0115/HRS0084/HRS_0084-0014.htm for details.

Sources: N/A

Score: 0%

Scoring criteria: These are the scoring criteria for this question.
Yes: A YES score is earned if there are specific formal rules prohibiting nepotism, cronyism, and patronage in the hiring of legislative staff. These should include competitive recruitment and promotion procedures as well as safeguards against arbitrary disciplinary actions and dismissal.
No: A NO score is earned if no such regulations exist.

6. In practice, legislative branch actions related to the hiring, firing, and promotion of legislative staff are not based on nepotism, cronyism, or patronage.

Notes: Jean Aoki said her group League of Women Voters objected to business executives hired as interns for state lawmakers, which posed a potential conflict. The Honolulu Star-Bulletin in 2007 reported the state Legislature banned business and industry representatives from interning for state lawmakers as a way to lobby or gain inside knowledge about proposed legislation. There have been several failed legislative efforts to prohibit nepotism, according to the Honolulu Star-Advertiser. Political blogger Ian Lind said patronage should be expected. Lind said legislative staff are “at-will” employees, so patronage is expected to be an issue. However, Lind said nepotism should be watched more carefully.

Sources:

• Jean Aoki, retired Off-board Liaison for Elections, Legislature, League of Women Voters of Hawaii, 9/20/11, telephone interview.

• Honolulu Star-Bulletin, Richard Borreca, 1/17/07, “‘Embedded lobbyist’ business interns out”

• Honolulu Star-Advertiser, Susan Essoyan, 3/11/11, “Bill to ban nepotism in hiring for state jobs clears key hurdle”

• Honolulu Star-Advertiser, editorial board, 3/2/11, “Approve bill on appointed BOE”

• Honolulu Star-Advertiser, Susan Essoyan, 12/5/10, “Efforts have failed to outlaw employing close relatives”

Score: 25%

Scoring criteria: These are the scoring criteria for this question.
Very Strong: Nepotism, cronyism, and patronage are actively discouraged at all levels of the legislative branch. Hirings, firings, and promotions are based on merit and performance.
Fair: Nepotism, cronyism, and patronage are discouraged, but exceptions exist. Political leaders or senior officials sometimes appoint family member or friends to favorable positions, or lend other favorable treatment.
Very Weak: Nepotism, cronyism, and patronage are commonly accepted principles in hiring, firing and promotions.

Discussion: