Louisiana Voice

The Louisiana Board of Ethics gave the green light to Jay Guillot Friday to serve on the Board of Elementary and Secondary Education (BESE) from District Five while simultaneously holding nearly $17 million in state contracts.

But the route it took to arrive at its decision would lead just about any observer to conclude the fix was in well in advance of Friday’s decision.

That route also conveniently permitted the board to avoid addressing an even stickier situation—that of the practice by BESE member Chas Roemer of routinely voting on matters pertaining to charter schools even though his sister, Caroline Roemer Shirley, is executive director of the Louisiana Association of Louisiana Public Charter Schools.

Additionally, a closer examination of the state ethics laws may answer the question as to why Guillot waited until after the election to seek a ruling on his qualifications to serve on the board.

The ethics board underwent a general housecleaning in June of 2008 when nine members resigned six months after Gov. Bobby Jindal took office. That occurred after Jindal pushed through a law that stripped the board of its authority and gave it to administrative law judges, all while imposing a tougher burden of proof for board members to meet when making determinations of ethics violations.

The board is comprised of 11 members, seven of whom are appointed by the governor, giving him a solid majority. Two are elected by the State Senate and two by the House.

The original inquiry was initiated by LouisianaVoice in a letter to the board. That letter was received by the board on Nov. 2, one day before the Nov. 3 deadline for items to make it onto the December agenda. Deborah S. Grier, executive secretary to the board, in a letter dated Dec. 7, said, “This is to acknowledge receipt of your correspondence or complaint as referenced above. It will be placed on the board’s agenda for consideration at its December 15, 2011 meeting.”

The reference given the LouisianaVoice inquiry was Docket No. 2011-1688 and the two questions—Guillot’s eligibility to serve while holding multi-million contracts with the state and Roemer’s voting on matters that posed an economic benefit to his sister—were to have been considered in executive session last Thursday and a recommendation made to the full board on Friday.

That never happened.

Instead, the staff recommended, and the board chose to consider, a request received Nov. 28 by Jimmy Faircloth on behalf of Guillot—well after the Nov. 3 cutoff date.

Faircloth was himself fined $1,000 last April for an ethics violation stemming from his accepting $7,000 in legal fees from the Louisiana Tax Commission six months after he resigned as Jindal’s executive counsel. State law requires a waiting period of one year before entering into a contract to represent a state agency. He also returned the $7,000 in fees and his $1,000 fine was suspended so long as he remained in compliance with ethics laws.

The board chose to consider Faircloth’s request even though his letter to the board was not received until 3:26 p.m. on Nov. 28, nearly four weeks after the Nov. 3 deadline for making the December agenda.

Moreover, the board ruled that LouisianaVoice owner Tom Aswell, who made the request, “had no legal standing” to request a ruling from the board.

It was not immediately clear as to what standard is used by the board to determine “legal standing.”

Whatever that standard may be, it also served the convenient purpose of allowing the board to continue to look the other way as Chas Roemer continues to vote on matters concerning charter schools that come before BESE.

Guillot’s decision to retain Faircloth as his attorney was a solid one. Both Guillot and Roemer were endorsed and backed financially by Jindal in their campaigns, so why not bring Jindal’s former legal counsel into the action?

In an undated draft letter to the board, staff attorney Tracy Barker recommended that Guillot be cleared to hold the contracts on behalf of his company, Hunt-Guillot & Associates (HGA) of Ruston while serving on the board because he does not have 25 percent ownership in HGA and because the contracts were not with BESE itself. His financial statement as well as Faircloth’s letter to the board indicated Guillot owned only 14 percent of HGA.

The staff’s recommendations were adopted by a 10-0 vote. Dr. Cedric Lowrey of Alexandria, one of the four members not appointed by Jindal, recused himself. Faircloth also is from Alexandria as is board member Grove Stafford, a 2008 Jindal appointee.

The ruling did, however, say that while HGA may complete its contracts, including one for $16 million that calls on HGA to monitor the administration of grants to parishes and municipalities as part of the recovery process from Hurricanes Katrina, Rita, Ike and Gustav, it may not renew its contracts.

That is because the state ethics law, promoted and passed by Jindal barely more than a month after taking office during a 2008 special legislative session, stipulated that no state office holders, including BESE members, who held ownership of five percent or greater could participate in any contract or subcontract that is funded or reimbursed in whole or in part with federal funds or for any disaster recovery contract.

The $16 million contract with the Office of Community Development (OCD) through the Division of Administration (DOA) is specifically for disaster recovery and is 100 percent funded by federal Community Development Block Grant (CDBG) funds.

The really interesting thing about Guillot’s request to the board is the timing. Normally, a candidate with a potential conflict of interest would request and obtain a determination from the board prior to paying qualifying fees and incurring campaign expenses.

Not Guillot.

His strategy was to win and then get the ruling after the fact—kind of like the theory that it’s easier to get forgiveness than permission.

There may well have been a method to the madness, however.

That $16 million contract? It is actually the second of two such contracts of comparable amounts with OCD for the oversight of the grant administration.

The first contract expired on June 30 of this year.

The current contract kicked in the next day, on July 1—right in the middle of the campaign for the BESE seat.

What if he had requested the opinion, say last April or May?

It is entirely possible that the board might have ruled his company ineligible to submit a proposal for renewing its contract in light of his ongoing campaign for state office.

In order to circumvent the possibility of an adverse ruling that would cost his company millions, simply wait until after the election—and even more important, after the new contract goes into effect—and get a ruling then.

But what happens when the current three-year contract expires on June 30, 2014? By that time, nine years post-Katrina, logic would dictate that virtually all disaster recovery would be complete and that there would be no need to renew the contract for another three years.

If, however, the disaster recovery is not over, or should another hurricane necessitate a new round of disaster recovery funding, look for Guillot to resign from BESE in order to prevent his firm’s losing out on a new multi-million dollar contract. Of course, he would have to resign on or before June 30, 2013–or a full year before expiration of the contract. That would still give Jindal 18 months of a super majority on BESE to push through his educational programs.

Brilliant strategy.

Could that familiar adage about the “Golden Rule”—“Those who’ve got the gold make the rules”—apply to Jindal’s “gold standard” of ethics as well?

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“Today, we take the first step towards building a better Louisiana where our ethics laws are the gold standard.”

With those 19 words, Gov. Bobby Jindal on Feb. 10, 2008, signed into law SB-1 of the 2008 special legislative session which, among other things, banned legislators and other state officials from contracting with the state.

SB-1, which became Act 2 with Jindal’s signature, was the centerpiece of the new governor’s agenda (he had been in office little over a month at the time). It also prohibited businesses owned by state and local public officials from receiving recovery-related contracts whether competitively bid or not.

So where does that leave Jay Guillot, a principal of Hunt Guillot & Associates (HGA) of Ruston? The Louisiana Board of Ethics will take up that question this week, thanks to an inquiry submitted by LouisianaVoice after Guillot appeared to be dragging his heels in seeking a clarification.

At the same time, LouisianaVoice inquired as to the legality of Baton Rouge BESE member Chas Roemer’s voting on matters involving charter schools that come before the board. Roemer’s sister, Caroline Roemer Shirley, is executive director of the Louisiana Association of Public Charter Schools and has already been directed by the Ethics Board not to speak at BESE meetings on behalf of matters concerning charter schools or to talk to BESE members about charter school matters because of her brother’s membership on the board.

Chas Roemer, however, has consistently voted on matters concerning charter schools and in some cases, even made motions to approve or not approve certain agenda items concerning charter schools.

It would seem that Guillot would have sought a ruling from the Ethics Board prior to qualifying to run for the District 5 seat on the Board of Elementary and Secondary Education (BESE). Instead, after winning the election, he retained Tech graduate attorney Jimmy Faircloth, who once worked as executive counsel for Jindal, to submit the matter to the board. But Faircloth not only did not get the request to the board in time for its December meeting but has now missed the deadline for January as well.

At issue is Guillot’s qualification to serve on BESE in light of nearly $17 million in state contracts held by his company. One of those contracts is for $16 million and involves HGA’s monitoring of the administration of grants to parishes and municipalities as part of the recovery process from Hurricanes Katrina, Rita, Ike and Gustav.

Act 2 would appear to give Guillot a technical out when it said that no officer holder (including BESE members), spouse or “legal entity” (including any corporation or partnership) may enter into a contract with the state unless competitively bid or competitively negotiated through a request for proposals (RFP) (emphasis ours).

The $16 million contract for HGA was negotiated through an RFP.

But the law then goes on to disqualify office holders, including BESE members, from participating in a contract or subcontract that is funded or reimbursed in whole or in part with federal funds or for any disaster recovery contract (emphasis ours). HGA’s own model file system submitted to the Division of Administration (DOA) defines its contract as a “Disaster Recovery Program.”

Moreover, the state’s contract data page, which lists all state contracts, the amount and the purpose, describes that $16 million contract as “Awarded by RFP, ….100 percent federal CDBG (Community Development Block Grant), HUD funds (emphasis ours)….grant management activities for infrastructure and other projects undertaken as a result of damages incurred as a result of hurricanes Katrina/Rita and to a lesser extent as a result of hurricanes Gustav/Ike.”

The passage and subsequent signing of SB-1 into law by Jindal prompted the Lafayette Advertiser to gush, “Louisiana has adopted a comprehensive plan for ethics reform, something many of us didn’t expect to see in our lifetimes.”

Even the New Orleans Times-Picayune said the new law would increase “government transparency and accountability.”

It’s just that kind of non-reporting, the reluctance to peel back the layers to find the real story that allows Jindal to continue to attend fundraisers all over the U.S. while touting the new era of “accountability and transparency,” thanks to his “gold standard” of ethics reform.

Even that beacon of ethical behavior, New Gingrich, got in on the act, saying that Jindal all but single-handedly fixed “the culture of corruption and cronyism that has long dominated Louisiana politics…” We’ll give Gingrich this much: he should know corruption and cronyism when he sees it.

That all sounds well and good, but what exactly does it all mean? Is it really the “gold standard” of transparency and accountability?

To learn the answer to that, one need look no further than the Supriya Jindal Foundation for Louisiana’s Children. The foundation, which installs high-tech multimedia whiteboards in Louisiana schools, provides a convenient conduit into which corporations have poured upwards of a million dollars as a means of circumventing campaign contribution limitations. It is also a handy way for the corporations to either avoid fines and penalties from state regulators or, better yet, to land lucrative state contracts.

So again, what does all this mean for the inquiry about Guillot’s conflict of interest now pending before the State Ethics Board? For that matter, what about Roemer?

Well, first of all, the Thursday hearing on the matter will be held in executive session, so who knows what goes on behind closed doors? Ethics Board attorney Tracy Barker, who is handling the inquiry, said the complaint would be received and reviewed in executive session. “The board will make a decision to either order an investigation to consider the matter further, or it will decide no investigation is merited and the matter will be closed,” she said.

Secondly, if scores of previous rulings are an indication, historically there has been a lot of latitude given public officials in their dealings with the state and its boards and agencies.

For whatever reason, Jindal holds undue sway over many legislators and over a lot of agencies that should be autonomous, the Ethics Board among them. Guillot and Roemer are his hand-picked candidates (the governor contributed thousands of dollars to the recent campaigns of both men) and it would be no surprise if the word had already come down from the fourth floor of the State Capitol earlier in the week.

It remains to be seen if the Ethics Board has the backbone to enforce the spirit of the law or if it will instead crater and look for sufficient wiggle room to appease Jindal.

Vegas oddsmakers would likely put little stock in any “gold standard.”

Jindal is simply too transparent.

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