Let the Ethics Bill Games Begin!

Ethics Bill Provides Exceptions to Client Disclosure Requirements
The New York Law Journal by Joel Stashenko  -  June 8, 2011

ALBANY, NY - State legislators with active law practices on the side will have more than one year to prepare for new requirements that they disclose the names of some clients.  A bill released yesterday by Governor Andrew M. Cuomo, and accepted in principle late last week by legislative leaders, sets July 1, 2012, as the compliance start date for the new disclosure rules.  Any work for clients involving the state for which legislators or their firms have received more than $10,000 will have to be reported by the lawmakers on the financial disclosure forms for the 2012 calendar year. The forms must be submitted by May 15, 2013, and must be posted on a website for public viewing by the newly formed Joint Commission on Public Ethics.  Legal work requiring client identification will include representing companies or individuals before state agencies, promoting clients' efforts to secure state contracts worth more than $50,000 and advancing clients' efforts to get legislation or resolutions passed in Albany, according to the 114-page bill.  Legislators who do not comply will face civil penalties of up to $40,000.

Assembly Speaker Sheldon Silver, a Manhattan Democrat who is of counsel to Weitz & Luxembourg, has criticized what he has called overly broad client disclosure for lawyer-legislators because of the potential that clients could be put in danger by breaches of confidentiality in personal matters.  As expected, therefore, the measure contains exemptions where legislators do not have to reveal clients' names. Those conditions include legal matters for clients with business before the state who also have divorce, domestic violence or child custody cases. When the legal work is part of a law enforcement investigation or bankruptcy proceeding, the clients' names also will not be subject to disclosure.  The legislation stipulates that the disclosure in compliance with the new requirements could not be used against legislators as a violation of attorney-client confidentiality canons.  The bill also provides for the disclosure of all outside income, whatever the legislator's outside business interests.  The disclosure forms now require statements to the Legislative Ethics Commission, but they are not disclosed to the public, and government reformers say they cover such wide bands of income—such as $100,000 to $250,000 or over $250,000—so as to be nearly worthless.  The new forms will require lawmakers to report income in 108 categories, ranging from nothing to in excess of $10 million. And they will be released to the public.  Mr. Silver and his counterpart in the Senate, Dean Skelos, R-Rockville Centre, said their chambers will pass the ethics bill by the end of the 2011 session, scheduled for the week of June 20.  The bill retains the Legislative Ethics Commission, which has been criticized in the past for secrecy and its apparent reluctance to punish legislators for ethical lapses.  While allowing the new Joint Commission on Public Ethics to investigate lawmakers, the Legislative Ethics Commission will be required to administer punishment.  The new 14-member joint commission will replace the 13-member Commission on Public Integrity.  Under the new bill, legislative leaders would appoint a total of eight members to the new joint committee, and the governor six. Approval by at least two of those eight would be required to investigate a legislator.  Senator Neil Breslin, an Albany Democrat who is also of counsel at Hiscock & Barclay, said he was in favor of the client reporting requirement as long as practitioners with nominal legal practices did not have to comply.  Mr. Breslin said he mainly does wills and house closings and would have opposed revealing those clients. The $10,000 threshold will relieve him of that duty, he said.  Sixty-three members of the current Legislature have law degrees. There are four Assembly vacancies in the 212-member Legislature.  According to a report compiled in January by the New York Public Interest Research group, 45 state legislators reported making at least some money in 2009 from practicing law outside the Legislature.  Realtors and/or landlords, with 47 legislators involved, was listed as the most popular source of outside income.  Russ Haven, legislative counsel for NYPIRG in Albany, said "time will tell" whether some lawmakers depart the Senate or Assembly rather than report the names of their bigger clients.  But he said some constituents may be turned off to find their legislators pulling in large legal fees at the same time they are making at least $79,500 a year as state representatives.  "It's going to depend on what your business practices are at this juncture and what your constituents will say if a big number comes out on the outside income," Mr. Haven said yesterday. "In communities and districts, they may say, 'Oh, my God!' Is it possible that senator or assemblyman X makes that much money?"  Assemblyman Joseph Lentol, a Brooklyn Democrat who said he maintains a "very limited, if not non-existent" legal practice, said some legislators with lucrative practices may well end up leaving the Legislature because of disclosure requirements.  "If you are a lawyer, it is tough to disclose your clients' names," he said in an interview yesterday. "Eventually, you are going to lose that client. He will go to a lawyer who doesn't have to disclose clients' names. You may lose some good people because of that. The jury is out on that one."  |Joel Stashenko can be contacted at jstashenko@alm.com.

Lawmakers With Law Degrees

Senate

Joseph P. Addabbo Jr., D-Queens
John Bonacic, R-Mount Hope
Neil D. Breslin, D-Albany
John A. DeFrancisco, R-Syracuse
Hugh T. Farley, R-Schenectady
John J. Flanagan, R-East Northport
Michael Gianaris, D-Queens
Mark J. Grisanti, R-Buffalo
Kemp Hannon, R-Garden City
Jeffrey D. Klein, D-Bronx
Andrew J. Lanza, R-Staten Island
Kenneth P. LaValle, R-Port Jefferson
Serphin R. Maltese, R-Queens
Jack M. Martins, R-Mineola
Michael F. Nozzolio, R-Seneca Falls
Thomas F. O'Mara, R-Big Flats
Michael H. Ranzenhofer, R-Amherst
Stephen M. Saland, R-Poughkeepsie
John L. Sampson, D-Brooklyn
Dean G. Skelos, R-Rockville Centre
Lee M. Zeldin, R-Shirley

Assembly

Thomas J. Abinanti, D-Greenburgh
Marc S. Alessi, D-Wading River
William A. Barclay, R-Pulaski
Jonathan L. Bing, D-Manhattan
Philip Boyle, R-Bay Shore
Edward C. Braunstein, D-Queens
James F. Brennan, D-Brooklyn
Harry B. Bronson, D-Rochester
Kevin A. Cahill, D-Kingston
Ronald Canestrari, D-Cohoes
William Colton, D-Brooklyn
Brian Curran, R-Lynbrook
Steven Cymbrowitz, D-Brooklyn
Jeffrey Dinowitz, D-Bronx
Andy Goodell, R-Jamestown
Richard N. Gottfried, D-Manhattan
Al Graf, R-Holbrook
Sean T. Hanna, R-Mendon
Hakeem Jeffries, D-Brooklyn
Tony Jordan, R-Jackson
Brian Kavanagh, D-Manhattan
Rory I. Lancman, D-Queens
Charles D. Lavine, D-Glen Cove
Joseph R. Lentol, D-Brooklyn
William Magnarelli, D-Syracuse
Tom McKevitt, R-East Meadow
Grace Meng, D-Queens
Michael Montesano, R-Glen Head
Daniel J. O'Donnell, D-Manhattan
Edward P. Ra, R-Franklin Square
Peter M. Rivera, D-Bronx
Addie J. Russell, D-Theresa
Robin Schimminger, D-Kenmore
Sheldon Silver, D-Manhattan
Aravella Simotos, D-Queens
Claudia Tenney, R-New Hartford
Fred W. Thiele Jr., R-Sag Harbor
Matthew Titone, D-Staten Island
Michele R. Titus, D-Queens
Helene Weinstein, D-Brooklyn
David I. Weprin, D-Queens
Kenneth Zebrowski, D-New City