There sometimes is overlap between Pennsylvania legislators’ official duties and outside interests, and some cases raise potential conflict-of-interest issues.
Mike Brubaker, R-Lancaster County, a two-term senator who decided not to seek re-election this year, sat on the Agriculture and Rural Affairs Committee and was one of a handful of lawmakers with agriculture-related financial interests.
Mr. Brubaker owns TeamAg, which played a role in the development of a composting project on 5 acres of a 55-acre tract in Manheim, Lancaster County. When a tax ruling threw a wrench into the project, Mr. Brubaker joined his colleagues in enacting a legislative fix.
Situated on George Hurst’s Oregon Dairy property, the 55 acres were enrolled in Clean and Green, a state program conferring a tax break on agricultural properties. In 2011, the Lancaster County Board of Assessment Appeals ruled that the composting operation violated Clean and Green, a decision that Mr. Hurst said exposed him to about $40,000 in back taxes.
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Supporters of the composting operation, called Oregon Dairy Organics, called for legislative action. Sen. Lloyd Smucker, R-Lancaster County, was the prime sponsor of a bill incorporating such composting operations into Clean and Green and waiving tax penalties against the Hursts and any other property owners statewide caught up in similar disputes.
Mr. Brubaker was listed as one of the bill’s sponsors, and he voted for the legislation in committee and on the floor. The legislation sailed through both chambers was signed by Gov. Tom Corbett in October 2012.
Mr. Hurst, a partner in the composting operation, said he never spoke with Mr. Brubaker about the legislation. He said TeamAg did engineering work on the composing project from about 2007 to 2010.
Mr. Brubaker could not be reached for comment.
Questions on funeral business regulations
Other states also permit lawmakers to sit on the committees that oversee legislation related to their outside financial interests. The goal is to tap the expertise that lawmakers bring to state government. However, that overlap can create at least the appearance of a conflict.
In 2008, York County funeral director Ernie Heffner led a group that sued members of the state Board of Funeral Directors and other officials responsible for overseeing the funeral industry in Pennsylvania. The suit accused the officials of refusing to modify decades-old regulations stifling competition, limiting consumer choice and, in the end, protecting the state’s large number of family-owned funeral homes.
The suit said the Pennsylvania Funeral Directors Association opposed an industry overhaul and that an association member, Sen. Robert Tomlinson, R-Bucks County, a funeral home owner who chairs the Senate’s Consumer Protection and Professional Licensure Committee, had used his influence to get a former association official reappointed to the board.
In a report prepared for Mr. Heffner’s lawyers, David Harrington, an economist specializing in the funeral home industry, noted that another association member, Rep. Harry Readshaw, D-Carrick, also owns a funeral home and has a hand in regulating the industry as minority chairman of his chamber’s Professional Licensure Committee. In interviews, Mr. Harrington, a professor at Kenyon College in Ohio, said he was “sort of flabbergasted” that two funeral home owners sit on the committees shaping their professions and considers the lawmakers impediments to reform.
“Any way you cut it, I think it’s a conflict of interest.”
“Any way you cut it, I think it’s a conflict of interest,” he said.
Mr. Harrington’s report said the state’s regulations — such as one limiting the number of funeral homes where a funeral director may practice and another requiring that every funeral home have an embalming room — thwart would-be competitors who would “take advantage of economies of scale and centralization.” He estimated that the regulations keep the cost of funerals an average of $550 higher than they would be in a more competitive, modernized market.
Mr. Heffner and his peers lost their suit this year, when the U.S. Supreme Court declined to hear the case. Mr. Tomlinson couldn’t be reached for comment. Mr. Readshaw said he wields little influence as a Democrat on a Republican-controlled committee.
“I don’t have a thing to say about what this committee considers,” he said.
Mr. Readshaw said lawmakers contribute a “vast amount of knowledge” about their professions, without hijacking the legislative process. Every legislator, he said, has one vote.
The association this year sent out letters supporting the re-election campaigns of Mr. Tomlinson and Mr. Readshaw. One letter, referring to Mr. Tomlinson, said, “There are still adversaries out there who are waiting for their opportunity to radically change funeral service in Pennsylvania. Tommy understands the need for continued vigilance.”
Kathleen Ryan, the association’s general counsel and chief operating officer, declined to address Mr. Harrington’s assertion that the legislators stand in the way of industry change. She said the association will take a position on proposed changes as they arise.
Turnpike pay-to-play
Rep. Glen Grell, R-Cumberland County, is an “outside corporate director” for Pace Resources Inc., parent of Buchart Horn Inc., an engineering firm. He said he’s had the position since before his election to the House a decade ago.
In a presentment last year, a state grand jury investigating Pennsylvania Turnpike corruption quoted an unnamed Buchart Horn executive as saying he anticipated consideration for contracts in return for political fund-raising. No one from the firm was charged in the pay-to-play scandal, which snared three of the Turnpike’s onetime top officials and a handful of others.
Mr. Grell said the political activity of Buchart Horn employees “was not something we discussed at the Pace Resources level.” Asked whether he had any ideas for strengthening campaign-finance laws, Mr. Grell said, “Not particularly.”
Natural gas leases
Sen. Elder Vogel, R-Beaver County, has sat on the Environmental Resources and Energy Committee, which shapes energy legislation. He also holds a gas lease on what he described as 1.2 acres of his family’s farm. He said he does not believe that the lease poses a conflict of interest and noted that other lawmakers are in a similar situation.
“We have attorneys here,” he said. “We have bankers here. We have insurance agents here. At some point in time, you’re going to vote on some piece of legislation your profession is involved in.”
Thomas Homer, former legislative inspector general for Illinois, said he believes legislators should be free to pursue outside financial interests but said that “does bring a special set of problems. It is natural members would vote, you know, their interests.”
But Peggy Kerns, director of the Center for Ethics in Government at the National Conference of State Legislatures, said it’s wrong for anyone to assume that lawmakers put themselves first.
“I was a legislator in Colorado for eight years, and I didn’t find that,” she said.
Marcellus shale development is one of the state’s hottest topics, with battle lines drawn over such issues as local zoning authority, environmental regulation, forced pooling and severance taxes.
Like Mr. Vogel, state Reps. Pam Snyder, D-Greene County, and Jim Marshall, R-Beaver County, have gas leases and sat on their chamber’s energy committee. Several other legislators also reported energy-related interests last year, though their statements of financial interest didn’t provide details.
“To be honest, I don’t even think about being a leaseholder,” Mr. Marshall said, describing his lease as covering less than 1 acre of a seven-acre family-owned tract. There is no drilling there now, he said, and any future income would be “insignificant.”
This year, he noted, he opposed a bill favored by many leaseholders.
That bill would have prevented energy companies from deducting post-production costs from leaseholders’ minimum royalty levels. Mr. Marshall said he supported the intent of the bill but was concerned that the legislation, if enacted, would have thrown the legality of many leases into question. The bill never had a vote on the House floor.
Ms. Snyder said she and her husband had a Marcellus lease before she became a lawmaker last year. She said their third-generation farm long has been the site of conventional gas activity. “Now, we have Marcellus on top of that.”
Because she’s a leaseholder, Ms. Snyder said, she has asked Democratic and Republican officials about the proprietary of voting on bills pertaining to energy issues. She said she even raised the issue publicly in committee.
Each time, she said, she was cleared to vote because she’s “one member of a big body, and it’s our job to vote on these issues.” Ms. Snyder, who supported the post-production bill, said her neighbors have no qualms about a conflict of interest.
“In fact, my neighbors and everyone in Greene County want the post-production bill to pass,” she said.
First Published: December 21, 2014, 5:00 a.m.