Ethics
Report from the City Ethics Commission
In January and February 2008, the Los Angeles City Council introduced two motions that would require the members of neighborhood council boards to file a public personal financial disclosure form if their councils choose to put an item before the City Council by creating Neighborhood Council Files, or NCFs.
For elected officials, and many appointed officials and employees, personal financial disclosures are made using a California Statement of Economic Interests, or Form 700. In March, the City Ethics Commission responded to requests from three City Councilmembers to review a possible Form 700 filing requirement for neighborhood council governing boards that create NCFs.
Throughout California, elected officials, many government employees and certain public service appointees are required by State law to file periodic financial disclosure statements because they make or participate in making governmental decisions. This public disclosure requirement serves two main purposes. First, it helps alert officials and employees to any financial interests they may have that could be affected by their governmental actions. In this way, it acts as a tool that enables public officials to seek advice before acting so that they can avoid conflicts of interests. Second, because the filings are public documents, financial disclosure statements help promote accountability in government decision making.
Ultimately, therefore, public financial disclosure can help maximize confidence that decisions are made only on the merits, without regard to anyone’s private financial gain. In reviewing whether to recommend the Form 700 filing for neighborhood councils who create NCFs, the Ethics Commission concluded that the level of disclosure required by Form 700 would be disproportionate to the role and responsibilities of neighborhood council board members at this time.
Currently, neighborhood councils are advisory bodies, with no ultimate decision-making authority. Consequently, in the Ethics Commission’s view, requiring broad financial disclosure for neighborhood council boards at this point could have the unintended consequence of reducing public participation, rather than encouraging it.
Instead, the Commission recommended an alternative form it created, CEC Form 52. CEC Form 52 asks for some of the same financial interests as Form 700, including employers, real estate interests, and business interests. The form asks that those financial interests be disclosed, however, only if they relate to an NCF and only by neighborhood council board members who participate in the vote regarding the creation of the NCF.
The first page of Form 52 asks for items that the Ethics Commission identified as core financial matters: employers, real estate interests, and business interests. The second page relates to the particular NCF that triggered the reporting. Filers are asked to either make an affirmative statement that they have no other financial interests or benefits that relate to the NCF or to list the other financial interests or benefits that do relate to the NCF. In the Commission’s view, Form 52 would strike a balance between the advisory role of neighborhood councils and the transparency benefits of public financial disclosure.
Neighborhood council board members already are subject to the conflict-of-interest provisions in the state’s Political Reform Act of 1974. Some financial disclosure is important because, the Commission concluded, it would serve as a tangible reminder of those requirements. By helping to ensure that potential conflicts of interests for neighborhood council board members are detected and avoided, it also would promote public confidence in the neighborhood council process. The City Council’s Education and Neighborhoods Committee considered financial disclosure by neighborhood council board members in February and April and will take the matter up again in early May. After the committee makes its recommendations, the full City Council will weigh in and make a final determination about whether to require financial disclosure of neighborhood council board members and, if so, what level of disclosure to require.
The issue stems from City Council action on January 15, establishing a two-year pilot project that authorizes neighborhood councils to create up to three NCFs per calendar year. Creating an NCF requires two neighborhood councils: one to introduce the file, and another to second it. An amending motion attempted to require members of both neighborhood councils to file Form 700.
However, the Los Angeles Administrative Code currently exempts neighborhood councils from filing Form 700, so a second motion was introduced in February to request an ordinance that eliminates the exemption. NCFs do not obligate the City Council to any action, but instead serve as formal suggestions to the Council to take action on a particular matter. NCFs are matters of public record, and will provide a record of what issues draw the attention of neighborhood councils and what action, if any, the Council chooses to take on those matters. (More info from, and about, the City Ethics Commission … including Form 52 …at: www.ethics.lacity.org .)
|
