The ongoing tests for financial disclosure

Next month the Michigan electorate will witness another test of the financial disclosure concept they approved in 2022 when adopting Proposal 1 as a constitutional amendment requiring financial disclosure by elected state officials and candidates for those offices.

On April 15 financial disclosure forms are due from all members of the state House and Senate, as well as from the governor, lieutenant governor, secretary of state and attorney general. Candidates for state offices in this election cycle who have either received more than $1,000 in contributions or spent more than $1,000 will also be required to file as well.

Members of the state legislature for decades have avoided the issue of financial disclosure despite the fact that on a number of occasions lawmakers of both parties have put forth bills to address this ethics issue. Too often opponents of financial disclosure have hidden behind the existence in both the House and Senate of ‘ethics’ rules which lacked the force of law and did not address financial disclosure.

If anyone needs a reminder as to why detailed financial disclosure is needed, just look at the recent criminal investigations in Lansing involving lawmakers who have abused the system for their own benefit.

The logic behind Proposal 1 was to bring more transparency to the process of governing by giving the public and the press ready access to personal financial information as a deterrent against conflict of interest on the part of those either writing the laws of the land or those officials charged with administering the laws.

Unfortunately the House and Senate lawmakers responsible for adopting legislation to enact the specifics of Proposal 1 failed the first test in this process. They wrote far less than perfect laws that provide too many loopholes which can be exploited to circumvent the wish of the voters, the most glaring of which include failing to mandate that specific financial information from spouses and immediate family members as they are required each year to file some general information as part of this process.

The second test will come in mid-April when the first set of disclosure forms are due and state residents will be able to determine who thumbs their nose at the requirements by either not filing at all or not providing detailed information as required.

The third test of the disclosure requirement will come on the enforcement front. The department of state is charged with enforcing the law and policing information that is put on file. The penalty for failing to disclose as required by law or for willfully filing inaccurate income information is $1,000, a mere pittance for someone intent on not complying with the law.

Some observers like to reference the regulations for members of Congress where the detail of information demanded is much more specific, spouses and immediate family member disclosure is much more detailed and fines for filing late or violation of other regulations range from $200 to as much as $50,000. But even then the enforcement situation is lacking, as evidenced by U.S. House candidate Peter Meijer who has yet to file the required disclosure forms months after the deadline and, when we last checked, had yet to be fined for violation of the rules.

Let’s hope elected leaders pass the test, and if not, that the state department does its job.

State residents have been given a poor substitute for what was originally sought when it comes to transparency as it applies to potential conflicts of interest by elected state leaders. We can only hope that other test results will be better.