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State given D plus: Shutdown, weak laws bring low marks

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ST. PAUL - Minnesota political candidates have gained freedom in how they raise money for elections, and state government has been deeply divided over how to spend its money.

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Those two factors and ethics laws that lack teeth explain Minnesota's D-plus grade in the "State Integrity Investigation" compiled by the Center for Public Integrity, Global Integrity and Public Radio International - a study that gauged transparency and accountability in all 50 states.

While the grade is low, no state earned higher than a B-plus, and Minnesota's 69 score ranks the state 25th in the nation.

"The real battle today is over an avalanche of money into politics and the disclosure requirements in Minnesota are just no longer sufficient," said Larry Jacobs, director of the Center for the Study of Politics and Governance at the University of Minnesota.

Somewhat ironically, part of the reason Minnesota received a low grade is it does not have the history of serious government corruption that has prompted reforms in other states.

Corruption cases are relatively minor compared with scandals elsewhere. In the early 1990s there was the "Phonegate" scandal by Democratic lawmakers who used state-funded toll-free phone access codes for personal use. There were also some recent campaign finance violations by the state's Republican Party.

And while not a scandal, last year's state government shutdown raised questions about the openness of the state's budgeting process.

Closed for business

On the last day of June 2011, under Minnesota's marble Capitol Rotunda, people holding signs and making speeches protested a looming government shutdown. But most of the Capitol press corps didn't listen. They were one floor up, sitting in a quieter wing outside of the Gov. Mark Dayton's office, talking on cell phones and working on laptops. They were waiting to hear whether Dayton and the Republican legislative leaders were going to compromise on a budget deal.

The two sides could not come to agreement and the Democratic governor refused to call a special session. On July 1, 19,000 state employees were laid off, affecting licensing and regulatory services, highway construction and state parks and campgrounds.

Government observers say decision-making in the state is usually done in public, and citizens have ample opportunity to have their voices heard. But the government shutdown and budget deal provided a troubling example of how legislation gets passed with little public input at the end of a legislative session.

Weeks of closed-door negotiations between Republican leaders and the Democratic-Farmer-Labor Party led by Dayton produced a compromise on July 19. A special legislative session was called and the budget bills were signed into law.

By the time the government was open for business again, Minnesota's citizens were just beginning to grasp the details contained in those budget agreements.

Minnesota Public Radio reported advocates for the disabled were surprised to find new policies for group homes included in the bill - changes that officials had not publicly discussed.

Cash for campaigns

Also last summer, the Republican Party of Minnesota agreed to pay a $170,000 fine for a series of federal campaign finance violations between 2006 and 2008. According to the agreement, the party failed to properly report debts on its federal campaign finance reports and inappropriately transferred money between state and federal spending accounts.

The state GOP is $2 million in debt and observers say more such violations could be revealed in the wake of the party chairman's December resignation over mismanagement of the party's finances.

Underfunded watchdog

Minnesota ranked 40th out of 50 states and received an F grade from the Center for Public Integrity in its 2009 ranking of financial disclosure rules for state legislators. The state received low marks for the lack of spousal and client information by state lawmakers and constitutional officers. Neither does the state require the economic disclosure statements to be audited. Minnesotans have to trust that politicians are being honest about their financial interests.

Minnesota's Campaign Finance and Public Disclosure Board has the authority to audit economic disclosure forms as well as campaign finance and expenditure reports if it chooses but rarely does so.

The board is underfunded by the Legislature and does not have the resources to regularly conduct audits, according to its executive director, Gary Goldsmith. In some states, auditors are funded through fees paid by campaigns, but Minnesota's oversight mechanism is funded through the state's general fund and subject to the economic and political interests of legislators.

Common Cause Director Dean said the board checks for errors but stated that illegal contributions occur: "Corporate donations to political parties and candidates are banned, but there have been violations of those contributions with no consequences."

Minnesota's board also is responsible for oversight of lobbyists' registrations. But a key problem, according to people who regularly examine the information, is the lobbyists' disclosures are often too little, too late.

Lobbyists must register with the state but are not required to report whom they are lobbying or what bills they are lobbying for or against. They simply have to give a general description of subjects for which they expect to lobby.

A politicized bench?

Jacobs said Minnesota has one of the nation's most respected judiciaries.

Historically, Minnesota judges could not raise campaign funds directly, seek partisan endorsement or publicly express views on topics that might come before them in court. However, since a 2002 U.S. Supreme Court decision that allowed candidates for judicial office to announce their views on legal and political issues, the election process for judges has become more political and attracted more cash.

Also, judges are exempt from state laws requiring disclosure of assets and potential financial conflicts of interest.

"Minnesota and a number of other states are facing the approaching Death Star of a politicized judiciary. It is only a matter of time until we have judges running for office and getting campaign contributions for their rulings," Jacobs said.

Ahndi Fridell reported and wrote this story for the Center for Public Integrity.

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