Lawmakers are questioning how Minnesota awards money to nonprofits as a state senator faces scrutiny for his association with groups he helped fund.
Sen. Bobby Joe Champion.
Senate President Bobby Joe Champion, DFL-Minneapolis, recently stepped down as chair of the Senate Subcommittee on Ethical Conduct amid questions about his pro bono legal work for the head of a nonprofit he helped get $3 million through a budget bill two years ago.
Champion, an attorney, has maintained his free legal work for Rev. Jerry McAfee, who heads the Minneapolis violence prevention organization 21 Days of Peace, did not coincide with his efforts to fund the group in 2023. His ties have prompted ethics concerns from his Senate colleagues.
Champion stepped down from the committee pending a review and advisory opinion, though a few days later, Senate Republicans filed an ethics complaint against him, asking the ethics committee to look into whether he violated rules prohibiting actions that discredit the Senate or undermine public trust in government.
Weak ethics rules
It’s rare for ethics complaints to result in serious action against a member of the Legislature. And direct funding for nonprofits through bills rather than through a competitive process is commonplace at the Capitol.
Further, Minnesota’s ethics laws for state lawmakers have historically been rated as weak by watchdog groups, and the part-time nature of the Legislature, where many members hold other jobs, lends itself to some level of conflicts of interest, political observers say.
David Schultz, a political science professor at Hamline University, said the nature of Minnesota’s “citizen Legislature” lends itself to an acceptance of the fact that lawmakers’ work will naturally intersect with their occupations.
In the 1990s, the state enacted a ban on lobbyist gifts to legislators, though few major changes have happened since, including disclosure rules. In fact, lawmakers relaxed some of those restrictions in 2013, MinnPost reported.
“We’ve been resting on our reputation for 30 years, thinking we’re doing a really good job, thinking that we have really good ethics disclosure rules, when, in fact, we don’t,” said Schultz.
In 2015, the Center for Public Integrity, a nonprofit watchdog, gave Minnesota a “D-” rating for government accountability and transparency, ranking it 28th out of 50 states. The score was a composite of many factors, including public access to information and lobbying disclosure.
On its legislative accountability index, the center rated Minnesota an “F” at 44th place. The state has made few changes to its ethics rules since.
Sen. Mark Johnson.
Current state ethics rules say members can’t vote on matters that result in a direct financial gain for themselves or their business disproportionate to others in the same field. There’s nothing preventing a teacher, farmer, nurse or business owner from voting on matters related to their work.
Earlier this month, Senate Minority Leader Mark Johnson, R-East Grand Forks, told reporters that’s to be expected in a part-time legislature, but Champion’s ties warrant greater scrutiny.
“You have teachers voting on education bills, you have contractors voting on bonding bills. But here you have a specific group that a legislator funds money to and then they have connections,” he said. “We have some real concerns about that.”
Sen. Erin P. Murphy. (Courtesy of the Minnesota Senate)
Asked by reporters about the potential conflict, Senate Majority Leader Erin Murphy, DFL-St. Paul, recalled eventually leaving her position as executive director of the Minnesota Nurses Association after being elected to the Legislature, despite her role not violating ethics rules.
“It is time for us to take a look again at what we need as a standard on the conflict of interest,” she said. “So, members doing good work for the people of Minnesota: Don’t get caught in that gray area.”
Legislatively named grants
It’s commonplace for Minnesota lawmakers to grant funding to specific nonprofit organizations. Museums, arts groups, charities, and educational groups are often funded by name in bills.
After Champion’s ties to nonprofits he helped fund came to light, lawmakers of both parties said the Legislature should explore changes to legislatively named grants.
Sen. Michael Kreun. (Courtesy of the candidate)
Among them is Sen. Michael Kreun, R-Blaine, who brought the Senate Republicans’ complaint against Champion. Kreun said there should be stricter rules on when nonprofit organizations get money directly through a bill rather than having to apply for it through a state agency.
“Maybe there are situations where it is appropriate, but I think they should be rare,” he said. ”I think we should take a look at the rules surrounding those so that those particular bills are scrutinized more.”
Even before Champion’s potential conflicts came to light, a bipartisan group of House lawmakers called for a competitive grant process rather than naming specific nonprofits as recipients.
The letter, signed by all eight members of the House Fraud and Government Oversight Committee — five Republicans and three DFLers — urged members of budgeting committees to stop making legislatively named grants. They noted that while they make sense in some cases, they should be the “rare exception rather than a general practice.”
Sen. John Marty, DFL-Roseville, who authored the lobbyist gift ban from the 1990s, called the named appropriation issue an ethical “minefield” and said he’s interested in commissioning a report by experts to give the Legislature advice on changing the process.
“I think we do better than most states in a lot of ways, but … I think we have a long way to go,” he said. “We’ve got some good legislators trying to do good things, but, but we should be doing better, and it avoids more problems if we do this.”
Marty said one thing lawmakers need to consider when restricting direct grants to nonprofits is whether the bid process will actually result in a different outcome. In some cases, there may only be one nonprofit that fulfills the state’s needs, and a grant process would be redundant.
Sen. John Marty.
Another concern Marty raised is that well-established foundations that know the government bidding process well would outcompete smaller nonprofits or nonprofits from historically underrepresented minority communities.
House lawmakers signaled they were aware of that concern in their March letter.
“We want to reassure you that a shift away from direct legislative appropriations need not diminish our role in guiding funding to meet the unique needs of our communities, they wrote. “Guidelines and reviewers should ensure that smaller organizations and those serving underrepresented communities are not overlooked.”
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