1. Making Michigan a Leader in Government Ethics 1 Attorney General Mike Cox Representative Paul Opsommer Senator Bruce Patterson

2. Making Michigan a Leader in Government Ethics2 Michigan is struggling under the weight of a poor national image on ethics Michigan needs a solid foundation of government ethics as part of its comeback. Michigan needs a solid foundation of government ethics as part of its comeback. To attract a high-skilled work force and new jobs, we must instill confidence that Michigan government is transparent and ethical. To attract a high-skilled work force and new jobs, we must instill confidence that Michigan government is transparent and ethical.

3. Making Michigan a Leader in Government Ethics3 DEAD LAST nationally on financial disclosure. 1 DEAD LAST nationally on financial disclosure. 1 Michigan is one of only 3 states with no financial disclosure law. Michigan is one of only 3 states with no financial disclosure law. No reporting of lobbyist provided gifts received by public officials or their immediate family members. No reporting of lobbyist provided gifts received by public officials or their immediate family members. Law does not require legislators to abstain from voting when conflicts of interest appear. Law does not require legislators to abstain from voting when conflicts of interest appear. 1 - Per Center for Public Integrity Where does Michigan Stand?

4. Making Michigan a Leader in Government Ethics4 What Are Innovative States Doing? Louisiana had a poor national reputation on ethics. Louisiana had a poor national reputation on ethics. But, Gov. Bobby Jindal held a special legislative session in 2008 to improve transparency and ethics. 2 But, Gov. Bobby Jindal held a special legislative session in 2008 to improve transparency and ethics. 2 New disclosure requirements moved Louisiana from bottom of ethics rankings to the top this year. New disclosure requirements moved Louisiana from bottom of ethics rankings to the top this year. Jindal says that strengthening ethics laws will help Louisiana attract investment and jobs – and he’s right. 2 Jindal says that strengthening ethics laws will help Louisiana attract investment and jobs – and he’s right. 2 2 - Per Center for Public Integrity

5. Making Michigan a Leader in Government Ethics5 What People Say About Michigan’s Need for Reform “Personal financial disclosure allows citizens to have confidence that their elected representatives are serving the public interest, rather than their own financial well-being.” “Personal financial disclosure allows citizens to have confidence that their elected representatives are serving the public interest, rather than their own financial well-being.” Rich Robinson, Michigan Campaign Finance Network Rich Robinson, Michigan Campaign Finance Network “…allow voters to come to their own conclusions about the interests lawmakers, statewide officials or local officials may serve once in office.” “…allow voters to come to their own conclusions about the interests lawmakers, statewide officials or local officials may serve once in office.” Detroit News Editorial Board Detroit News Editorial Board “Well, there we are again. Dead last.” “Well, there we are again. Dead last.” Ron Dzwonkowski, Detroit Free Press Ron Dzwonkowski, Detroit Free Press

6. Making Michigan a Leader in Government Ethics6 What Have We Done So Far? The Attorney General’s office was first in the state to place all spending, travel and contracts online in 2008 and settlements online in 2009. The Attorney General’s office was first in the state to place all spending, travel and contracts online in 2008 and settlements online in 2009. www.michigan.gov/trackyourtaxes www.michigan.gov/trackyourtaxes www.michigan.gov/settlementcenter www.michigan.gov/settlementcenter Traveled to all regions of the state advocating for transparency. Traveled to all regions of the state advocating for transparency. Now it is time for the next step. Now it is time for the next step.

7. Making Michigan a Leader in Government Ethics7 Make Michigan a Leader in Ethics Create first-ever financial disclosure law for public officials, their families and candidates. Create first-ever financial disclosure law for public officials, their families and candidates. Report of gifts and travel from lobbyists. Report of gifts and travel from lobbyists. Report large loans, income, assets and transactions. Report large loans, income, assets and transactions. Establish low thresholds to ensure transparency. Establish low thresholds to ensure transparency. Create serious penalties for not following the law. Create serious penalties for not following the law. Require candidates for governor to release last three tax returns. Require candidates for governor to release last three tax returns. Put legislative conflict of interest disclosure in statute. Put legislative conflict of interest disclosure in statute.

8. Making Michigan a Leader in Government Ethics8 Financial Disclosure Plan REPORTING PROPOSAL ITEMSTHRESHOLDCURRENT DISCLOSURE Gifts from lobbyists (e.g., sporting tickets)$250 (aggregate) NONE Reimbursements from lobbyists (e.g., travel)$250 (aggregate) Elected officials do not report; Lobbyists report after $725 Income (e.g., wages, salary, dividends, rental income, grants, scholarships) $1,000 NONE Assets (i.e., property, stocks, bonds)$2,500 NONE Asset Transfers (purchased, sold or exchanged) $1,000 NONE Liabilities (e.g., mortgages)$10,000 NONE Positions with companies, non-profits, labor organizations and educational organizations. None

9. Making Michigan a Leader in Government Ethics9 Financial Disclosure Plan Who would be required to disclose? Who would be required to disclose? State officials: Governor, Lt. Governor, Attorney General, Secretary of State, State Boards of Education, Department Directors, Legislators and Supreme Court Justices. State officials: Governor, Lt. Governor, Attorney General, Secretary of State, State Boards of Education, Department Directors, Legislators and Supreme Court Justices. Local elected officials who earn more than $65,000. (i.e. mayors, county executives and commissioners) Local elected officials who earn more than $65,000. (i.e. mayors, county executives and commissioners) Candidates for any of the above. Candidates for any of the above.

10. Making Michigan a Leader in Government Ethics10 Gift and Travel Reporting Gifts must be reported when annual aggregate value exceeds $250 per lobbyist. Gifts must be reported when annual aggregate value exceeds $250 per lobbyist. Closes the immediate family loophole. Closes the immediate family loophole. Current lobby law requires NO reporting below $56 per month, per lobbyist and has NO limits for family gifting. Current lobby law requires NO reporting below $56 per month, per lobbyist and has NO limits for family gifting. Travel and other reimbursements reported when annual aggregate value exceeds $250 per lobbyist. Travel and other reimbursements reported when annual aggregate value exceeds $250 per lobbyist. Closes the immediate family loophole. Closes the immediate family loophole. Current lobby law requires reporting after $725. Current lobby law requires reporting after $725.

11. Making Michigan a Leader in Government Ethics11 Putting Teeth in the Process Secretary of State administers and maintains website. Secretary of State administers and maintains website. SOS investigates and has administrative subpoena power; Attorney General prosecutes. SOS investigates and has administrative subpoena power; Attorney General prosecutes. Failure to file truthful and timely information could result in criminal charges: Failure to file truthful and timely information could result in criminal charges: 30 days past due or knowingly inaccurate: $5,000 late fee. 30 days past due or knowingly inaccurate: $5,000 late fee. Fail to file two reports: misdemeanor, one year and/or $2,000. Fail to file two reports: misdemeanor, one year and/or $2,000. Fail to file three or more reports: felony, four years and/or $10,000. Fail to file three or more reports: felony, four years and/or $10,000.

12. Making Michigan a Leader in Government Ethics12 Clarifying Legislative Conflicts of Interest Prohibit legislators from voting when there is a conflict of interest. Prohibit legislators from voting when there is a conflict of interest. In the last six-and-a-half years, few have abstained: In the last six-and-a-half years, few have abstained: House: 33 times in 6,495 votes. 3 Senate: Zero times in 5,382 votes. 4 House: 33 times in 6,495 votes. 3 Senate: Zero times in 5,382 votes. 4 House and Senate Rules do not Match; House rules are not as strong as the Senate. House and Senate Rules do not Match; House rules are not as strong as the Senate. "If a member desires to abstain from voting because of a potential conflict of interest, the Member may rise…" "If a member desires to abstain from voting because of a potential conflict of interest, the Member may rise…" Requires disclosure prior to abstaining from voting. Requires disclosure prior to abstaining from voting. Definition expanded to include business associates, in addition to immediate family. Definition expanded to include business associates, in addition to immediate family. Requires creation of enforcement rules. Requires creation of enforcement rules. 3 – Per House Journals, 2003-2009 4 – Per Senate Journals, 2003-2009

13. Making Michigan a Leader in Government Ethics13 Make Michigan a Leader in Ethics Report lobbyist gifts for officials, candidates and family. Report lobbyist gifts for officials, candidates and family. Disclosure of personal finances. Disclosure of personal finances. Abstain from voting when conflicts of interest occur. Abstain from voting when conflicts of interest occur.