It’s tough to answer these kinds of questions about potential conflicts of interest because the state won’t release the financial disclosure statements of members of most boards and commissions.
But lawmakers are considering changing that. Senate Bill 2682 would require 16 of the most powerful boards and commissions in Hawaii to make their financial disclosure forms public for the first time.
The Hawaii State Ethics Commission, which supports the bill, says it lacks the resources to vet the roughly 1,800 financial disclosure statements it receives annually from state employees, including all the volunteer board members. Only 180 or so are open to public inspection now, counting those filed each year by all 76 state lawmakers.
“[T]he Commission’s ability to identify potential conflicts of interest is very limited and, frankly, except in rare circumstances, unlikely,” Ethics Executive Director Les Kondo told lawmakers last month.
“The public, especially those who are involved with and may be impacted by the board/commission member’s action, is best able to identify and raise concerns about possible conflicts of interest.”
There are dozens of state boards in Hawaii, some of which effectively set the policy direction for entire departments.
A version of this measure has been put forward numerous times, but it has found more traction this year in the Legislature.
The House Judiciary Committee, chaired by Rep. Karl Rhoads, received almost 300 pages of testimony on the bill at its most recent hearing last week. Roughly 90 people testified in support.
The only opposition has come from members of the state boards and commissions who would be affected. Generally, their testimony conveys a consistent message that it’s unfair to single them out and that making the financial disclosure statements public deters the best candidates.
The Labor and Industrial Relations Appeals Board upped the ante in its testimony against the bill Thursday.
Board members David Pendleton and Melanie Matsui wrote a seven-page letter to lawmakers that highlighted concerns over identity theft, physical safety, homicide and even suicide.
“LIRAB believes that this bill is well-intended, but it does not address or provide safeguards for the security issues and potential misuse of information that may arise from public disclosure of financial and other personal information,” they wrote.
The board members said that because LIRAB is a board that primarily adjudicates workers’ compensation matters, the reality is roughly half of its customers are unhappy with the outcome of a case.
“LIRAB is particularly concerned with the personal and physical safety of the board members,” the letter says. “On more than one occasion, the members of the LIRAB have been subjected to threatening and intimidating conduct by some very emotional and volatile litigants. Homicidal and/or suicidal ideations, while rare, are not necessarily uncommon references in cases.”
Carmille Lim, executive director of Common Cause Hawaii, said public disclosure is all the more important for boards and commissions that are considered the head of a state department or have significant authority.
“In order to strengthen the public’s trust in these boards and commissions (and in the individuals serving on these boards and commissions) we must make sure that disclosure forms which may indicate a potential conflict of interest through financial stake is transparent and accessible to the public,” she told lawmakers Friday.
The bill has evolved since its introduction in January.
But when the Senate draft crossed over to the House, the Consumer Protection Committee, chaired by Rep. Angus McKelvey, added 15 boards to the list.
The House Judiciary Committee is set to hear the bill Thursday afternoon. If it passes there and clears the full House, lawmakers from both chambers would meet in conference committee next month to resolve the differences between the two versions.
Rhoads told Civil Beat Tuesday that he is hopeful his committee will pass out something “robust.”
“I don’t see any particular reason why they shouldn’t have their financials disclosed and think the committee will concur,” he said.
He said he takes the LIRAB’s concerns about physical danger seriously — and may amend the bill to address them to a certain extent — but he doesn’t view them in the same order of magnitude.
Rhoads said he has been submitting financial disclosure statements for eight years as a state lawmaker. The past two years he has chaired the Judiciary Committee, arguably the hottest seat in town when it comes to making big decisions on social issues.