The New Orleans Ethics Review Board voted unanimously on Monday to recommend a revision to the city’s Code of Ethics that would bar City Council members and candidates from accepting political contributions from city-regulated utility firms like Entergy New Orleans or Cox Communications, along with any vendor working on a contract awarded by the City Council or the Sewerage and Water Board.
“It just makes good sense,” Ethics Review Board Chairwoman Elizabeth Livingston de Calderon told The Lens. “It’s good policy, frankly, and it fits perfectly within the ethics code.”
But the recommendation is just that — a recommendation. The City Council would need to approve the change for it to actually become law. And there are still some big legal questions about whether the City Council has the authority to wade into campaign finance restrictions or apply government ethics rules to candidates who aren’t yet government officials.
The Ethics Review Board recommendation is similar to rules the City Council has already made for itself. The council has voluntarily restricted campaign contributions from Entergy New Orleans and the city’s utility consultants since 2007.
The recommendations haven’t been formally sent to the City Council yet. After hearing a brief description of the rules over the phone, Andrew Tuozzolo, chief of staff to Councilwoman Helena Moreno, who chairs the utility committee, told The Lens that he wasn’t prepared to comment on the specifics, but that the general sentiment was aligned with Moreno’s views.
“It’s in line with our views on avoiding conflicts of interest or instances in which regulated entities exert undue influence,” Tuozzolo said.
Group seeks to clarify rules and penalties
The New Orleans City Council has a responsibility that most city governments don’t have to deal with — regulating the city’s electricity provider, Entergy New Orleans. In most places in the country, electric utilities are regulated at the state level with specialized bodies like the Louisiana Public Service Commission.
Public Service Commission candidates have historically funded their campaigns on contributions from the companies they regulate, as well as other businesses whose revenues are impacted by commission decisions.
But since at least 2007, the New Orleans City Council has periodically passed resolutions to recommit to the voluntary pledge to abstain from Entergy contributions. The most recent resolution was passed this summer, and was more extensive than previous versions because it extended the restrictions to council candidates who aren’t currently sitting council members.
The council’s recent resolution was passed without vocal opposition and with support from many of the city’s most active energy and climate advocates. But some thought that those rules needed more teeth. One of those was Rev. Gregory Manning, chair and founder of the Greater New Orleans Interfaith Climate Coalition.
“There wasn’t a firm understanding of what penalties there would be if there was some violation,” Manning told The Lens. “So that needed to be made clear.”
The council’s resolutions act as more of a voluntary public campaign pledge, rather than enforceable rules. So Manning and the rest of the coalition decided to write a proposal to the city’s Ethics Review Board to turn the city’s campaign finance pledge into an enforceable rule codified in the city’s Code of Ethics.
Violating the Code of Ethics can lead to a fine of up to $500, six months imprisonment or both. Ethics Review Board Executive Administrator Dane Ciolino told The Lens that the board can levy the fines itself and deposit collected fines with the city’s Bureau of Treasury.
Whether the board has the authority to put people in prison, however, is not entirely clear.
“That’s a huge question,” Ciolino said. “Some people would tell you that the board isn’t a criminal court, so it shouldn’t be involved in imposing criminal sanctions. But it’s just never been tested.”
He added that most ethics enforcement is done at the state level, and that the city’s ethics code largely mirrored the state’s. But in the rare instances where New Orleans ethics rules are more stringent than the state’s rules, enforcement falls to the city’s Ethics Review Board.
Manning and the climate coalition brought their proposal to the Ethics Review Board in June. Now that it has received the board’s approval, the recommendations will be forwarded to the council for consideration, Ciolino told The Lens.
Ethics code rarely amended
The recommended rule would ban contributions from Entergy, Cox or any other utility, cable company or telecommunications firm regulated by the city, as well as any political action committee — such as Entergy’s ENPAC — or executive staff member who “can be reimbursed by the regulated company or is otherwise a conduit contribution from the regulated company.”
The proposed rules would also bar contributions from any person or entity that has a professional services contract “awarded by or pertaining to” either the City Council or the Sewerage and Water Board.
On top of that, the proposal would create a new reporting requirement for council candidates. Within 30 days of the qualifying deadline for the election, a candidate would need to submit an affidavit to the Ethics Review Board and the city’s Law Department that clarifies whether the candidate had accepted “compensation or financial benefit” in the last five years from a utility regulated by, or company that has a contract with, the New Orleans City Council. (In 2019, Councilman Jay Banks was criticized for his previously undisclosed work for a council utility consultant.)
The affidavit would also have to clarify whether the candidate has ever served on a board of a corporation that is regulated by the City Council or that has a professional services contract with the City Council.
Manning said the board’s decision was welcome, but surprising.
“I was very surprised at the unanimous vote yesterday. I was very pleased, but at the same time I was very shocked it went through.”
Changes to the city’s ethics rules are not very common.
“The City Code of Ethics has been amended only very modestly since it was enacted in the 1950s,” Tulane University Law Profession David Marcello told The Lens.
Board chair Calderon said the lack of revisions isn’t due to an ingrained resistance to change, however. She said that the board simply doesn’t receive many proposals to change the rules like the one submitted by the Greater New Orleans Interfaith Climate Coalition.
“I’ve been on the board since 2017, and this is the first time that a group has brought forward a proposal to amend the code. So it’s not that we reject them all the time, they don’t come up that often.”
Before approving the recommendation on Monday, the board heard a presentation from Marcello on some potential legal issues in codifying the rules. He brought up three central questions. First, does the Louisiana Campaign Finance Disclosure Act preclude New Orleans from passing it’s own campaign finance rules? Second, would the new rules violate First Amendment rights to free speech? And third, can the ethics rules dictate the actions of all council candidates, whether or not they have been elected and sworn into office?
“The board discussed those legal issues, but didn’t resolve them,” Ciolino said. “The board is certainly mindful that those are issues the council needs to consider. The board’s recommendation was simply on the policy. But as far as whether or not, as a matter of state statute and state constitutional law, whether it would be an appropriate exercise of the city’s authority is a matter the City Council is going to need to determine.”