Legislators Can Carry Bills That Benefit Them? Yep.

This is one in a series of occasional stories about ethics and transparency in the part-time Texas Legislature.

Sen. John Carona, the founder of Associa, the nation’s largest homeowners association management firm, recalls facing allegations of conflicts of interest in the late 1990s and early 2000s, when the Dallas Republican carried legislation aimed at governing such property owners’ groups.

In 2001, he authored the state’s biggest homeowners association law to date, a measure he said provided a “property owner’s bill of rights” without weakening homeowners associations.

Opponents argued that the law did not go far enough to curb homeowners associations’ power to foreclose on residents’ homes. When a colleague filed a bill in 2003 to make such action more difficult, Carona argued that it would not stop foreclosures and would “devastate homeowners associations throughout the state.”

But by the mid-2000s, Carona had largely steered clear of authoring homeowners’ association bills. He said despite his subject-matter expertise, his business interests had become “a distraction” to concerned advocates for homeowners. Last session, when the Senate debated another homeowners association reform bill, Sen. Royce West, D-Dallas, authored it.

“I quickly came to the conclusion it was better just to stand back,” Carona said, “not because the law required me to but because I didn’t want the criticism.”

Under the Texas Constitution, state lawmakers are not prohibited from authoring or voting on measures that stand to benefit them, so long as they benefit all others in similar circumstances. Indeed, Texas’ citizen Legislature — where lawmakers come to Austin for five months every other year, receive a meager state stipend, and live and work in their home districts the rest of the time — was designed to ensure legislators were in touch with the challenges facing their communities and had expertise in a range of industries. 

But the common practice of lawmakers carrying bills or serving on committees that could directly affect their lives or livelihoods has critics, including ethics watchdogs who say it is impossible to tell which lawmakers are working for their constituents and which are consulting their checkbooks.

While many legislators drew in their breath last session when Rep. Gary Elkins, a Jersey Village Republican who is in the payday lending business, took the floor to make a personal plea against saddling his industry with consumer protection legislation, his actions were only unusual because of how brazen he was.

Jack Gullahorn, a Texas ethics expert who represents the state’s trade association for lobbyists, said that if constituents knew their lawmakers’ professional or personal ties, nine times out of 10 they would be fine with them. The problem, he said, is that “the public doesn’t have enough information available about the private interests and relationships of the people that are making the decisions in our Legislature to be able to adequately draw conclusions about whether it’s a good idea or not.”

Family matters

In March 2007, Rep. Harold Dutton Jr., D-Houston, brought three bills up for consideration before the House Committee on Juvenile Justice and Family Issues that he chaired, all designed to benefit parents obligated to pay child support.

One would have required a court setting child support payments to consider factors like the children’s age and the financial resources and earning potential of both parents, including the one with custody. Another opened the door to reducing payments in multi-child families once one of the children turned 18 or moved in with the non-custodial parent. A third would have forced courts calculating unpaid child support to take into account payments made directly from one parent to another, as opposed to through the state’s disbursement unit.

The state’s existing child support rules had “provided a huge benefit to the obligee,” Dutton said at the time, “while putting the obligor at a substantial disadvantage.”

What the Houston lawyer did not add, in his impersonal remarks on the bills that passed the House but never the Senate, was that for years, he had been obligated to pay more than $20,000 in annual child support, according to court records. Several months later, when Dutton’s ex-wife — the mother of four of his sons — accused him of not keeping up with his payments, he argued that his original child support order did not explain whether his payments would shrink once his sons turned 18, and that he had been paying some of his support to her directly, rather than through the disbursement unit. He told a Houston TV station that he stopped making full payments in 2006, because two of his sons had turned 18 and one was living with him.

Dutton’s staff said he could not return phone calls for this article because he was away at a funeral. (In a 2005 Texas Observer story, he responded with a string of expletives to a reporter who asked if his personal experiences with family law guided his legislating.) But Nicole Bates, his chief of staff, said in an email that Dutton filed the 2007 bills in his role as chairman of the now-defunct committee, and on behalf of a father’s rights group, months before his own court case. Even if the measures had passed, she said, they would not have taken effect in time to affect him personally.

“Members have families and yes, some members even pay child support,” Bates wrote. “But to file a bill to somehow gain some personal benefit from it is a stretch.” 

Bar business

Rep. Charlie Geren, R-Fort Worth, chairs the House Administration Committee, and said lawmakers in his chamber recuse themselves “all the time” from voting on bills that hit too close to home, especially when those bills come up in committee.

They do it at their own discretion.

In 2005, lawmakers passed a bill targeting run-down bars operating in residential areas or near schools in the state’s biggest metropolitan areas by, among other things, more than quadrupling their wine and beer permit and renewal fees. In the process, the measure inadvertently applied those increased fees to restaurants. Two years later, Geren, one of the sponsors of the bill and the owner of Fort Worth’s Railhead Smokehouse barbecue restaurant, sought to make the fix.

At the time, Geren was vice chairman of the House Licensing and Administrative Procedures Committee, which regulates the agency that oversees alcohol permitting. He authored a bill that came before the committee in March 2007 that would have exempted the “holder of a food and beverage certificate from the higher annual fees applied to wine and beer retailer permit holders.” According to Texas Alcoholic Beverage Commission records, Railhead Smokehouse would have qualified: It received its beer and wine permit in 1995, and had received its food and beverage certificate seven months before the committee hearing.

Asked about the measure last week, Geren said he would “have to go back and read it” to be sure it had affected his restaurant. Even if it had, he said it applied to so many businesses that it would not have presented any kind of conflict.

The bill, which was voted out of committee unanimously, made it through the House and Senate before being vetoed by Gov. Rick Perry, who said that increasing permitting fees for neighborhood bars while exempting restaurants was “intended to price out businesses from existence.”

'You have a choice'

Sen. Leticia Van de Putte, a pharmacist and San Antonio Democrat, said she has no qualms about filing pharmacy-related bills. She has paid her dues, she said: When she was first elected more than two decades ago, the attorney general’s office advised her that she could not be a legislator and have a state Medicaid contract to cover her pharmacy’s many low-income patients.

Van de Putte said she sold the pharmacy, her family’s primary source of income at the time, at a loss of $100,000 to stay in the Legislature — only to watch the state reverse course with future lawmakers in response to a federal decision. She said she files pharmacy bills with the knowledge that she knows more about the industry than her colleagues, and the comfort that there is nothing she could pass that would recoup her state-induced losses. 

“I don’t know of any other person in the Legislature who the state has told, ‘You have a choice, either sell your business or don’t serve,’” she said. “When I author bills, I do it very proudly.”