Biz Group Warns Of ‘Chilling Effect’ Of Wolf Ethics Ruling
A leading business advocate on Monday worried that the recent State Ethics Commission ruling that derailed Sen. Daniel Wolf’s political career could have a “chilling effect” on participation in elected politics by small business owners.
Despite being at odds politically with the Senate Democrat from Harwich, National Federation of Independent Business state Director Bill Vernon called on the Ethics Commission to clarify its ruling that has forced Wolf to suspend his campaign for governor and make plans to resign his Senate seat this Thursday.
“There are thousands of small business men and women whose service at every level would be a benefit to the people of Massachusetts and I’m concerned that this ruling could discourage their interest and deny voters the chance to consider some very highly qualified candidates for public office,” Vernon, a former executive director of the state Republican Party, wrote in a letter Monday to State Ethics Commission Executive Director Karen Nober.
Vernon asked that the commission disseminate additional information and guidance for business people reading the Wolf ruling and applying it to their own circumstances.
Short of clarification from the commission, Vernon said, the Legislature should enact new laws so that “everyone understands the permissible levels of participation and everyone is treated fairly.”
The Ethics Commission earlier this month ruled that Wolf’s ownership stake in Cape Air created a conflict of interest for the second-term senator because of no-bid lease and operation agreements the airline holds with the Massachusetts Port Authority to fly through Logan International Airport.
The commission told Wolf he must resign his seat and give up his campaign for governor, divest from Cape Air, or cease the airline’s operations at Logan. Wolf last week suspended his campaign for governor, and plans to resign on Thursday unless the commission alters its ruling.
Though the 1962 law was designed to prevent public officials from benefiting financially from state contracts over which they may wield control, Wolf has argued that Cape Air’s agreements with Logan Airport are pro-forma and the fees are non-negotiable. The Legislature also has no budgetary oversight of Massport.
The Ethics Commission, in its ruling on Wolf, said it has consistently required legislators to divest their financial interests in state contracts as a condition of their public service.
However, many lawmakers have careers off Beacon Hill, and the Legislature has created exemptions from certain ethics laws for professions such as lawyers or if the financial interest in a state contract is smaller than 10 percent.
Sen. Kenneth Donnelly, an Arlington Democrat and co-chair of the Committee on State Administration and Regulatory Oversight, has pledged to have his committee review the ethics laws, particularly how they define a state contract.
“The Ethics Commission’s decision in the case of State Senator Dan Wolf, founder and principal shareholder of Cape Air, acts to discourage candidacies and voluntary governmental participation from the private sector just as we need the expertise those persons can offer,” Vernon wrote.
Vernon made clear that the NFIB would have been unlikely to endorse the liberal Democrat for governor next year, but despite policy differences on issues such as the minimum wage and mandatory paid family leave the business group still supports Wolf’s right to run.
“We are not political allies by any stretch of the imagination,” Vernon wrote in the letter.
Though he said he’s not familiar enough with the contracting procedures at Massport to say whether Wolf is in violation of the law, he said the expansion of government has led to an increase in points of contact for small businesses and government with no-bid contracts too small to qualify for public bidding or requiring uniform, non-negotiable fees.
“With the expansion of state government, it’s a much bigger business. There’s a lot of business that have some contact with government. Does that means they can’t run? If that’s the case and intent of the ruling, then the Legislature should look at it,” Vernon said. “It has the potential for eliminating lot of people from public office.”
Saying he planned to resign from the Senate “under duress,” Wolf last week indicated that ending all leases and operating agreements between Cape Air and Massport would “destroy” Cape Air and lead to the loss of 1,000 jobs. Divesting his holdings in Cape Air, he said, would “fundamentally undermine the company” while selling his shares to company employees “would saddle them with serious debt as I walk out the door, and create significant cash flow challenges going forward.” Wolf said that selling his shares to a private owner “would end employee control of the company’s future, removing protection from a forced merger or acquisition.”
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