Officials should be made to disclose REAL conflicts of interest

October 20, 1:13 PMTennessee Statehouse ExaminerDavid Oatney

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Frank Cagle proposed in his column last week that the General Assembly should pass legislation requiring full disclosure about who owns buildings that State, county, and municipal governments might buy or rent:

 

 

If a person owns a piece of property, his name is on record at the courthouse. If you have a corporation, the names of the principles are available. If it’s an LLC, then there is one name and an address to send the tax bill to. But the list of owners of an LLC is not publicly available.

 

So what’s the problem?

 

Suppose a big company plans a major facility in one of our counties. Local political and industrial development leaders know about it ahead of time and sign a confidentiality agreement. An LLC suddenly appears and starts buying up property. The LLC may be a front for the big company, being used so as not to bid up the property. But it could be some of the locals or public officials—or their brothers-in-law—buying up the property to sell to the company at a profit.

 

 

Across Tennessee, local, state, and federal government agencies rent office space. The total tab is in the millions of dollars. Many of the properties are in the name of LLCs. Do any elected officials have a wife who owns office buildings rented to the government? Do any legislators own offices rented by state departments? Who owns all the post offices, which are a nice secure 20- or 30-year lease that more than pays for the building?

 

We don’t know. We also don’t know the principles who may have put together the deal and then sold the package (and the lease) for a nice profit.

Some believe that the scenario Cagle describes may be happening in Jefferson County as this is being written with the proposal by Norfolk and Southern Railroad to build an inter-modal facility near New Market. Jefferson County public officials-most notably County Mayor Alan Palmieri-and even one member of the Industrial Development Board have signed confidentiality agreements not to disclose the railroad's plans for the proposed site. Some have even wondered if certain of the same officials who signed the confidentiality agreement might receive some benefit from the deal with the railroad which they would prefer the public not know about. The secrecy surrounding the intermodal project has caused such controversy that it has garnered the county mayor not one, but two Republican primary challengers in May of next year.

State law forces political candidates to disclose information about where they work and what they do, and also what their wife and children do, and all in the name of insuring an ethical and transparent government where the potential conflicts of interest of officials are known to the public. However, elected officials can enter into land or sales deals as one of many principles of a Limited Liability Corporation and hide any conflicts of interest they might have-that allowing a company to do something with land they in part rent or own might benefit them. Tennessee (and many other States) have some rediculous disclosure laws which require candidates to make public information about themselves which often has no bearing on their ability to do the job for which they are seeking election. However, disclosing property deals in which a public official might be involved can be a glaring conflict of interest when that official might make an arrangement that could benefit them personally or in their business interests.

Tennessee needs a law which requires local and State officials to disclose LLCs which they belong to which deal in property that is rented or sold to State, county, or municipal government. Tennesseans have a right to know if public officials are entering into agreements which might benefit those officials. It is up to the voters to decide whether those potential conflicts of interest are really serious conflicts or simply aren't issues at all-but voters deserve a full disclosure on how officials may benefit from the laws they pass and the agreements they enter into.