Bill Strengthening Ethics Act Becomes Law

July 15, 2011

Investigative Reports

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The NerveRecently enacted legislation strengthens South Carolina’s ethics law and gives the entity that enforces it, the State Ethics Commission, more power to do so.

But the Palmetto State still has a long way to go on ethics transparency and accountability when it comes to lawmakers themselves.

In another story The Nerve has covered but other media in the state largely have ignored, the General Assembly passed the legislation, House bill 3183, in late May. Both the House and Senate approved it on unanimous roll-call votes.

The bill then became law in early June, toward the end of this year’s regular legislative session.

The new law bolsters the Ethics Reform Act of 1991 with:

  • enhanced criminal provisions and more authority for the Ethics Commission to enforce the act;
  • tighter nepotism rules;
  • an increased cap on penalties for noncompliance with lobbying documentation;
  • and stricter registration requirements for lobbyists and their employers, so-called principals.

“I thought they (those changes) all made sense and would make our ethics law better,” Rep. Tom Young, R-Aiken and lead sponsor of the legislation, told The Nerve in an earlier interview.

Ethics Commission administrators drafted the bill and asked Young to sponsor it. The measure addresses several issues that have long concerned the commission, according to Herb Hayden, director of the agency.

Created in 1975, the Ethics Commission enforces state laws and rules governing ethics, campaign finance practices and lobbying activities. The commission features an administrative staff, which investigates allegations of wrongdoing, and a nine-member panel that adjudicates the cases.

The commission oversees the state’s nine constitutional officers and a handful of high-ranking appointed state officials as well as local elected representatives in South Carolina.

But the commission wields no authority over state legislators. Instead, lawmakers police themselves in ethics matters via separate House and Senate Ethics committees.

Many good-government State House watchdogs say that system creates an egregious lack of transparency and accountability. These reform-minded observers want legislative ethics enforcement to be put into the hands of an independent outside entity.

Sen. Mike Rose, R-Dorchester, is pushing a proposal to do just that. But Rose’s measure, S. 324, has gone nowhere.

For those officials who do fall under the purview of the commission, one of its main enforcement weapons is the much-despised fine. The Ethics Act prescribes fine amounts and caps.

The new components of the law include additional fines, and possible jail time, for individuals who still fail to file lobbying, campaign registration and disclosure forms or statements of economic interest even after they have been fined the maximum amount.

The additional penalties range from $500 or 30 days behind bars for a first offense to $5,000 and or one year in jail for third and subsequent offenses.

In addition, the Ethics Commission can now prosecute those offenses itself in a magistrate’s court.

Previously, the commission had to seek prosecution through a solicitor’s office, and that was problematic because solicitors usually have bigger things to worry about such as murders and robberies, according to Hayden.

The Ethics Act improvements also close nepotism loopholes by replacing “immediate family” with the broader term “family member” as it relates to conflicts of interest.

Likewise, “brother-in-law” and “sister-in-law” were added to a list defining family members in the law.

As to the higher cap on lobbying penalties, it applies to fines for late filing of registration and disclosure forms and has been increased from $500 to $5,000.

Similarly, a gap in the law that allowed lobbyists and principals to continue working the State House for months at a time even if they were out of compliance with the registration and disclosure requirements has been closed.

Now, lobbyists and principals must be in compliance at all times and pay any penalties they owe in order to continue engaging in lobbying activity.

Lastly, the amendments to the law also create a cap on fines for non-filing of campaign disclosure forms and statements of economic interest.

Under the old rules, beginning 11 days after notification of non-filing, those fines increased by $100 per day, every day, leading to a virtual debtor’s prison for dozens of officials and candidates who have failed to settle their cases with the Ethics Commission. See the list here.

To prevent that list from growing, those fines now have a $5,000 maximum.

“The commission has the authority to reduce those fines, and they do that quite regularly,” Hayden says of the agency’s debtors list. “The main thing is for them to get into compliance.”

Reach Ward at (803) 254-4411 or eric@thenerve.org.