THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Saturday, March 16, 1996 TAG: 9603160021
SECTION: FRONT PAGE: A10 EDITION: FINAL
TYPE: Editorial
LENGTH: Medium: 60 lines
What do swiss cheese and the financial-disclosure forms filed by Virginia lawmakers have in common? A lot, a recent episode suggests.
Last month when the House of Delegates was debating whether Trigon Blue Cross Blue Shield should pay the state $175 million or $230 million for the privilege of becoming a for-profit stock company, one of the persuasive voices was Norfolk Del. George Heilig's.
If the legislature went for the higher price, Heilig said, Trigon might jettison the deal. That would leave state budget planners, who were salivating over the extra cash for college-faculty raises and other projects, with a big problem.
The House heeded Heilig's advice. Who better to listen to than the chairman of the special House subcommittee that considered Trigon's demutualization bid?
What members didn't know, and what they likely would not have found out except for Trigon papers filed recently at the State Corporation Commission, is that Heilig had a business as well as legislative connection to the insurance giant. Trigon paid Heilig's former law firm $9,581 for routine legal work last year, $429 less than the amount that can trigger conflict-of-interest rules in the legislature.
Nor, except for the SCC papers, would the public have known that Del. Dick Cranwell, the Democratic floor leader in the House, and his firm were paid a hefty $385,560 by Trigon in 1995. More than half of the money was for work involving the company's conversion bid, which was then before the State Corporation Commission, not the legislature.
Cranwell severed his Trigon ties in January, after newspaper reports - again based on SCC filings - that his firm made $179,000 from Trigon in 1994.
Neither those legislators nor House Speaker Tom Moss, who also received a small Trigon retainer, violated any laws. But the episode points out once again that documents the public counts on for disclosure often are not worth the price of printers' ink.
As required, Cranwell noted on his economic-interest form that he represented Blue Cross Blue Shield before the SCC in its demutualization bid. He did all the law required to show the extent of his interest by checking this box: ``Over $10,000.''
Heilig also obeyed the law by checking a box saying that he represented ``other insurance companies,'' and that they paid him ``$1,001 to $10,000.''
It would be far better if the form mentioned somewhere that the ``other insurance company'' was a firm with a gigantic stake in legislation before the General Assembly. Or that ``over $10,000'' in Cranwell's case was closer to $400,000.
Such gaps in information make financial disclosure look like a sham. Worse, at a time when consumer-interest groups are charging that Trigon got a cozy deal, they foster fear that the $175 million conversion settlement could be a sham too. by CNB