ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Sunday, January 28, 1996 TAG: 9601290032
SECTION: VIRGINIA PAGE: B-1 EDITION: METRO
SOURCE: PETER BAKER AND SPENCER S. HSU THE WASHINGTON POST RICHMON
DEL. RICHARD CRANWELL stirred controversy when he revealed he was representing Trigon Blue Cross Blue Shield. But he's not the only lawyer-legislator with clients who are regulated by the state.
To those who watch Virginia's Capitol from afar, it might have seemed an obvious conflict of interest for the most powerful legislator to work as a lawyer helping a health insurer win state approval of a billion-dollar stock sale.
For many inside the building, however, it was business as usual.
In a state that takes a hands-off approach to public ethics, the case of House Majority Leader Richard Cranwell, D-Vinton, provoked relatively little protest among his colleagues recently, in part because Cranwell is hardly the only lawmaker here whose personal and financial interests are intertwined with his official duties.
Virginia has no limit on how much General Assembly members can accept in campaign contributions, and it grants wide latitude to members conducting private business as well as debating or voting on bills that would benefit themselves, their businesses or their friends.
Senators and delegates routinely represent clients before state regulatory agencies whose budgets and policies they set. Legislators who serve as bank officers, who own tens of thousands of dollars in bank stock, often are the ones who draw up legislation governing the industry. The same week that public attention was focused on Cranwell's representation of Trigon Blue Cross Blue Shield, the head of the Senate committee that oversees ethics laws voted to appoint his brother to a powerful state job.
"Among the 50 states, Virginia has among the laxer laws," said University of Virginia law Professor A.E. Dick Howard. In the early 1990s, he headed a gubernatorial ethics commission that tried, with little success, to tighten them. "There really aren't many bounds," he said.
The issue comes up perennially in Richmond because most lawmakers have full-time jobs during the 10 months a year the assembly is not in session. More so than such states as Maryland, which limit campaign gifts and prohibit legislators from lobbying state agencies, Virginia takes a laissez-faire approach toward its "citizen legislature." Its attitude is that voters can decide for themselves whether a politician has put personal interests ahead of theirs.
"The philosophy of the Virginia conflict-of-interest law is disclosure, not prohibition," said Sen. Joseph Gartlan, D-Fairfax County, who helped write the law. "With the needs of the people to make a living, disclosure is the better approach."
Little is likely to change any time soon. Almost every winter, both houses pass bills imposing caps on campaign donations - but the bills die quietly in conference committee. Even this year, after an election season in which Gov. George Allen accepted $125,000 from a polluter under investigation by his own administration, there appears to be no momentum for stricter laws.
Yet some who study ethics reform are skeptical that such laws make much difference.
"There are no wonderful formulas," said Alan Rosenthal, a political scientist at Rutgers University. "I mean, we've been reforming campaign finance nationwide and in the states for 20 or 30 years and seem [only] to have succeeded in making it a little worse than it used to be. I don't believe we need a lot more laws in the legislature. ... We need voters who will pay attention and make their judgments."
That was the argument Cranwell used to defend his legal work for Trigon, the state's largest health insurer, before dropping the case under fire Jan. 18. As long as voters knew of his role, he maintained, what was the problem?
Cranwell and his law firm received more than $230,000 in the last two years from Trigon, helping it with an application before the State Corporation Commission to convert to for-profit status. The change would allow the company to issue about $1.2 billion in stock. As floor leader in the House, Cranwell will play a central role in the selection of two of the three SCC commissioners who will hear Trigon's case in May.
Cranwell's case demonstrates the limits of disclosure. Before this month, Cranwell did not show Trigon as a client on his financial reports, although he did list an unnamed "health care provider" without including any estimate of what it had paid his firm. He did name Trigon on the 1995 form he filed this month but gave little elaboration on his earnings, only checking a box indicating that he received more than $10,000.
Cranwell long has profited from his experience in the legislature. After writing the state's annexation law in 1979, he became Virginia's leading lawyer for counties fighting annexation cases and, according to one estimate, has made millions of dollars from this work. In the last five years alone, he has represented 12 county governments.
He and his firm also have represented other clients before state agencies, including the Board of Medicine, the state Water Control Board and the Industrial Commission.
He has plenty of company. In an assembly with a greater percentage of lawyers than any other state legislature in the country - 39 percent before November's election - many members work the halls of state government long after the session adjourns.
House Speaker Thomas Moss, D-Norfolk; Senate Republican Leader Joseph Benedetti, R-Richmond; Dels. Alan Diamonstein, D-Newport News; William Robinson, D-Norfolk; and Franklin Hall, D-Richmond; and Sen. Kenneth Stolle, R-Virginia Beach, represented restaurants or convenience stores before the Alcohol Beverage Control Board last year. Sen. Thomas Norment, R-Williamsburg, represented inmates before the Parole Board. Del. Leo Wardrup, R-Virginia Beach, took a case to the Commonwealth Transportation Board.
"I shouldn't have done it," Wardrup said last week. "Legislators need to be more concerned with perception of citizens of the commonwealth as to what constitutes a possible impropriety. We ought to hold ourselves to a higher standard."
Others have had no second thoughts. Sen. Kevin Miller, R-Harrisonburg, chairman of the Privileges and Elections Committee, sees no reason why he shouldn't have voted to appoint his brother, former Del. Clinton Miller, to the SCC.
"I'm sure there's some people out there that perceive it to be wrong to participate in the selection of my brother for the State Corporation Commission," Miller said. "But you can read the law and the rules ... and I'm not in violation. I believe I'd be doing a disservice to abstain when I'm not required to."
Virginia statutes require lawmakers to abstain when they or their company would benefit personally but allow them to debate and vote if everyone in the business would be treated the same under the bill.
So bankers and others with corporate interests are free to shape law governing their own professions and industries. Of 22 members of the House Corporations, Insurance and Banking Committee, eight are bank directors, 14 own bank stock, nine do legal or other work for banks or insurers, and two own part or all of insurance companies. Only five have none of those entanglements. Likewise, 10 of 15 members of the Senate Commerce and Trade Committee have banking or insurance interests.
There is little mechanism to police the process. The House ethics panel, on which Cranwell sits, meets just once a year for about 10 minutes - simply to make sure that every delegate has turned in a disclosure form. House Clerk Bruce Jamerson said he could not recall the panel convening to consider any substantive issues or complaints.
Records in the Senate clerk's office also show how rarely lawmakers voluntarily take themselves out of the debate. On 1,287 votes in 1995, senators recused themselves for conflict of interest 47 times.
Confronted with that, some public interest groups complain that the deck is stacked against them.
"There are people who ask me why do we even bother to come?" said Jean Ann Fox, president of the Virginia Citizens Consumer Council, which lobbies against banks, insurers and utilities.
"Obviously, better rules would improve the reality of the situation and would help the public feel more confident that the decisions are being made on their behalf rather than [based on] this complex web of campaign contributions, lobbying activities and personal employment."
LENGTH: Long : 143 lines ILLUSTRATION: PHOTO: (headshot) Cranwell KEYWORDS: GENERAL ASSEMBLY 1996by CNB