Brown Didn’t Take Easy Path on CalPERS Bills

California’s Governor Jerry Brown signed signed Assembly Bill 873, which prohibits former CalSTRS and CalPERS board members and high-level executives from lobbying their former employers for ten years.  The bill is the most stringent measure yet to get at the “placement agent” scandals that in wrote about back in 1997.

In his signing message, Brown noted “what’s good for the goose, should be good for the gander,” meaning members of the Legislature should send him a similar bill prohibiting former members from lobbying current members for ten years, instead of the current one year limitation.

That seems highly unlikely. In 1997 I testified before a Senate hearing about gift giving at CalPERS. I remember one of the Senators leaning forward and looking at me over his glasses: “…and I suppose you think we shouldn’t be able to take gifts either?” I’m sure many in both chambers would not want to give up a lucrative career in lobbying.

Signing AB 873 was easy. However, Brown vetoed another measure, Senate Bill 439, that no member of either house opposed on the floor. It would have lowered the annual limit on gifts that CalPERS / CalSTRS board members and executives could accept from the current $420, that applies state-wide, to $50 from anyone doing business with CalPERS or CalSTRS.

Brown’s veto message says that the measure would “create a special set of rules that will apply exclusively to CalPERS and CalSTRS” and further complicate an already complex state reporting system without advancing government transparency very much.

Brown did a good job on these bills. While I’m generally against CalPERS / CalSTRS board members and execs accepting gifts, it was unreasonable to single out these two agencies.

I used to be an ethics officer for a department within CalEPA and would frequently get questions from officials wanting to accept small gifts from those doing business with our department. The laws in this area can be quite complex and frequently the cost of my time to answer their questions far exceeded the value of the gift in question.

A $4 sandwich, for example, could end up being valued at a true cost of $100 after factoring in all the expenses of the sponsor. You need to factor in the cost of invitations, speakers, room rental, catering etc. and if it were a poorly attended function that would drive up the cost of that $4 sandwich. This is an area that cries out for reform and simplification but is something that should apply to all public agencies, not just the two largest pension funds.

For more, see Jerry Brown signs one CalPERS bill, vetoes another, Sacramento Bee, 10/7/2011.

What do you think? Did he get it right?

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