Twenty-five years ago, as a young mechanic and pilot, a handful of people joined me to start an airline. With one plane, six employees, and one route, we created Cape Air. Today Cape Air is an employee-owned company with more than 1000 people, still headquartered in Massachusetts, serving communities around the world. I brought that entrepreneurial spirit and a commitment to doing the right thing to the State Senate and my recently announced candidacy for Governor.
As I was contemplating running for Governor this spring my office contacted the State Ethics Commission – out of an abundance of caution – to get their opinion on whether there would be any plausible conflicts between my ownership stake in Cape Air (approximately 20% of the company) and serving as Governor. An initial conversation with State Ethics Commission staff led me to believe that no such conflict would exist, reiterating an informal opinion regarding the State Senate before I was first elected in 2010. In addition, my filings to the Ethics Commission in the years since have clearly stated my holdings and relationship to Cape Air, which never have been flagged as an area of concern.
Unfortunately, I was informed by the Commission on Friday afternoon, August 2, that in their opinion the fact that Cape Air flies in and out of Logan, with agreements with Massport to do so, creates a conflict that can only be fixed either by Cape Air no longer serving Logan Airport – which would destroy the company — or by me completely divesting all interest in a company I spent 25 years building from the ground up. In the Commission’s opinion, short of taking one of these drastic steps, I could not serve as Governor and also would have to resign as State Senator.
The two Cape Air agreements with Massport in question date back to 2002. They automatically renew month-to-month and year-to-year respectively. The fees paid by Cape Air are not negotiated but are set by Massport in accordance with Federal regulations and apply to all airlines flying in and out of Logan. Neither Cape Air nor Massport have taken any affirmative action on these agreements since 2002.
Let me be clear: Massport took no affirmative action on these contracts while I was a State Senator and Cape Air took no action on these contracts while I was State Senator. There is no discretion to do so, based on federal standards and requirements.
Regardless of these facts, the Commission now holds that Cape Air’s involvement with Logan Airport through Massport precludes my continuing to serve as Senator and would prevent my serving as Governor.
This opinion, a full copy of which is attached, would prevent any successful businessperson who may have even tangential business interaction with the state from entering public life.
I disagree with this opinion and will be working to rectify what I believe to be an unfortunate conclusion based on a flawed process. And so I look forward to maintaining my ambitious campaign schedule and having an open, transparent conversation with the voters about this and every issue, continuing a dialogue that already is garnering grassroots support across the state.
I got into this race for Governor believing that we can make a real difference in the lives of working families that have been left behind in this economy. I still believe that. I look forward to sharing that message across the Commonwealth.
No doubt they didn’t especially relish this exercise in conjecture either. Lesson #2: Find a smart lawyer who can satisfy the Commission’s requirements. From the ruling, it sounds as though Senator Wolf can simply give his shares to his wife or another trusted person, for example one of his three children or someone else, and in all likelihood solve the problem, at least for the duration of the campaign. That doesn’t sound so terrible, or “drastic” as the Senator puts it. The commission discusses this kind of solution in considerable detail (hint, hint?). If he wins, and the Commission judges some further action is needed, he can cross that bridge when he comes to it. As to the politics, assuming the Senator can satisfy the commission he could spin it quite nicely, it would seem to me.
of transferring shares to family members is as easy as you suggest. The opinion discusses this option a couple of times, as you mention, and notes that “the consideration paid by the transferee” is a major factor in assessing whether the transferor has “completely and irrevocably” divested. Obviously, if Wolf simply hands off the shares to his kids, they’re not going to pay for them.
Isn’t that worthy of some consideration? Note that I stipulated a “smart lawyer.” There shouldn’t be anything a good lawyer cannot manage when it comes to matters like this.
… if $1 can be traced from the state budget to the coffers of Nixon, Peabody and/or Harvard Pilgrim, that would preclude the two top Republican candidates from running as well, right?
who practice in front of the judges whose salaries they set?
…a “no bid” contract, you may have a point about giving lawyer / legislators a public defender “contract” without a competitive bid may not pass the bureaucratic smell test of the Commission.
…which the commission has defined the 2003 contracts with Logan. (I don’t agree, Massport only grants carrier routes after heavy scrutiny and the month to month rent is akin to being a tenant at will, but that is a digression). So a Baker or Brown’s old and current firms can do tons of biz with the state, but only through the completive bidding process.
to do some work on my house. His brother-in-law had a permit my board had to decide on. I paid the electrician, but Ethics told me to make a disclosure. I live in a small town. The electrician’s wife cuts my wife’s and daughters’ hair (a requirement I don’t need a professional for). I’ve had other issues to discuss with them. They always err on the side of caution.
Since Cape Air is a side of his life he is clearly proud of certainly it is known in his district and he is now making it known statewide. I say it should ultimately be for the voters to decide whether they are comfortable with that connection. In the Senate he can always abstain from voting on a measure in which he has a direct stake. As Governor, maybe he can conveniently plan to be absent from the Commonwealth when an ethically problematic bill is scheduled to be sent to him thus allowing the LG to make the sign/veto call. Even though I’ve chosen another candidate it would be a shame IMO if this forced him out of the race.
What ethics issues were raised when Grossman became Treasurer and how did he deal with it? I mention this only to say Sen. Wolf might be able to use that as an example of how to move forward.
Isn’t Charlie Baker fully resigned from Harvard Pilgrim or was it a sabbatical? And for full disclosure Nixon Peabody is involved with litigation with my firm, though my only involvement was making sure they have us the right fax number.
I don’t recall the issue being raised so I don’t know if and how it was handled, but has Grossman Marketing (formerly MassEnvelope) ever printed materials for the state?
The issues isn’t whether Grossman ever had business with the state. The issue is whether Grossman owns a business that does business with an agency he has control over. Is he in any position to make or influence decisions that impact his own profits.
Let me say that I write this as someone seriously considering Wolf as my preferred candidate for governor, though I’m still waiting to see the whole field.
While I can understand the initial reaction of anger at the decision, and can appreciate that the Ethics Commission has a tendency of going overboard in protecting perceived taxpayer interests, the facts here remain surprisingly simple.
Wolf will continue to profit from an entity who’s state-related business he would be in a position to influence. As a state senator it would seem to be pretty easy to simply recuse himself from all relevant votes, committee discussions, etc, and that would fix the conflict. I’m unclear why that wouldn’t resolve the issue at the senate level.
As a governor, it would seem to me that if he wins, he’d have to sell his shares. It shouldn’t kill his campaign. He simply has to commit that if he wins he sells. The act of having ongoing business with the state through an entity that he would control does give the appearance of a conflict.
[removed copy and paste from Herald, link below – ed.]
1) Do you have a link for your quotes above?
2) Do you ever have anything positive to say about a politician or are you always as grumpy as you sound when you post here?
http://bostonherald.com/news_opinion/local_politics/2013/08/ethics_commission_fires_back_at_wolf
Searching for the typo (“A Wold campaign spokesman did not immediately return a call for comment”) shows the Herald article at the top – this entire comment was lifter word-for-word. As such, it’s a copyright violation, and the editors should just remove it.
RV is the same person who recently insisted that John Ketty had still not released his full military records, even though Kerry did exactly that 8 years ago. At least he’s not as bothersome as DFW!
it is a cut and paste and complete copyright violation. There isn’t even a link pretending to give its source credit.
The link to the Herald piece should be sufficient…
I agree State Ethics doesn’t go overboard here. The statute is very clear.
The rationale for such a law is clear, even though there is no reason to believe Wolf has used or would use his position for personal gain. I know a guy who serves on the planning board who recuses himself when one of his clients deals with the board. He’s violating ethics, however, by being on the board at all. He could develop bylaws that benefit his/his clients’ interests.
As a legislator, Wolf could introduce or support laws that indirectly benefit his business. As governor, his employees would have to take action that may or may not have affected his business interests. Aside from giving contracts to oneself, an official can take actions that make profit for his business.
http://www.bostonglobe.com/metro/massachusetts/2013/08/08/ethics-commission-disputes-claims-gubernatorial-candidate/LH7izpsu7L0yUQSdrs4wNJ/story.html
Wolf and “aide” appear to have spotty memories. And having Tom Kinton on Cape Air Board could have provided them a red flag in the beginning.