Friday, October 30, 2009

The New Orleans Ethics Review Board's failure to file financial disclosures

Featured below is an excerpt from the most recent report from the Louisiana Justice Institute: A Vote of No Confidence: The Case for Re-Organization of the New Orleans Ethics Review Board and Office of Inspector General. We believe that the debate over the future direction of these institutions is important to New Orleans' future. You can download the complete report at

Loss of Public Trust

The loss of public trust is evidenced by the citizen outcry for complete system reform. To date, many troubling issues have gone unaddressed, including financial reporting by the ERB, concerns of cronyism/favoritism in hiring at ERB and OIG, and staff dysfunction and instability.

The Louisiana Code of Government Ethics, §1124.2.1: "Financial disclosure; members of boards and commissions, requires each member and any designee of a member of a board or commission that has the authority to expend, disburse, or invest ten thousand dollars or more of funds in a fiscal year, to annually file a financial statement as provided by law." Notwithstanding this legal requirement, on October 16, 2008, ERB President Kevin Wildes sought and obtained an Advisory Opinion from the State of Louisiana Board of Ethics that was premised on the ERB’s claim that it “does not have the authority to expend, disburse, or invest $10,000 or more in funds, and does not have the authority to make recommendations that must be followed on the expenditure, disbursement or investment of such funds.”

The ERB’s statement to the Louisiana Board of Ethics was materially false, however. In fact, the ERB and OIG had already received authority to independently expend $300,000 and $3,130,000, respectively, for FY 2008, and $300,000 and $3,197,300 respectively for FY2009.

Furthermore, municipal ordinance proscribes the Mayor and the New Orleans City Council from controlling the ERB and OIG expenditures.

The ERB’s claim that it is exempted from the state law financial reporting requirement is a material breach of trust by the ERB, especially considering the Home Rule Charter and Municipal Code of the City of New Orleans mandate that the ERB is responsible for enforcing a similar reporting requirement for the Mayor, members of the City Council, city department directors, and other high ranking city employees.

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