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Lawmakers' outside jobs raise questions

Some routinely voted on issues that affect their private income.

November 28, 2008|Patrick McGreevy | McGreevy is a Times staff writer.

SACRAMENTO — Assemblyman Mike Eng, one of more than two dozen California lawmakers who hold outside jobs, was a steady vote for the Los Angeles Unified School District's interests this year at the same time his law firm was working for the district under a $550,000 contract.

A Democrat from Monterey Park who sits on the Assembly Education Committee, Eng voted multiple times for legislation sponsored by the district that allows it to obtain $267 million in extra state money.

His five-man law firm, meanwhile, collected $321,000 as part of its three-year deal from L.A. Unified, sometimes in payments made just weeks after Eng's vote. The payments were reported in district records as compensation for help in getting visas and processing paperwork for foreign teachers.

"Having legislators voting on bills that affect their sources of income raises questions of conflict of interest," said Bob Stern, president of the Center for Governmental Studies in Los Angeles. "Who is their loyalty owed to, the state or their income sources?"

Eng didn't violate any laws, Stern said. California allows legislators to cast votes affecting their industries or professions as long as the measures apply generally and do not affect only one company or agency.

But the assemblyman's actions highlight what some see as the state's failure to tightly govern moonlighting by lawmakers.

California's full-time lawmakers are the highest paid in the nation, earning $150,000 a year including salary and expenses (those in leadership posts make more). The salary is justified, lawmakers often say, because it enables them to live and support their families without outside income.

Yet 30 of the state's 120 legislators own businesses or hold other outside jobs, according to their most recent statements of economic interest, and some earn more income away from the Capitol than from the public payroll. They own such enterprises as car dealerships, farms, insurance companies, a plastics firm and a real estate appraisal firm. They work in law, agriculture, health insurance and other medical fields.

Some have routinely voted on legislation that affects their private income. Several lawmakers sit on committees that oversee legislation governing their professions or industries.

State Sen. Dave Cox (R-Fair Oaks), owner and president of Integrated Benefits and Insurance Services Inc., an insurance company doing business with large healthcare groups, sits on the Senate Health Committee.

In August, and three times last year, Cox voted against the creation of a state-run health insurance program that was lobbied against by four of his biggest sources of income: Kaiser Permanente, Blue Cross, Blue Shield and Health Net. Those companies have paid Cox's firm at least $240,000 since 1999.

Cox said his vote was philosophical, reflected the position of the Senate Republican caucus and had nothing to do with his business, which he owns with his wife, who runs it.

"We [in California] do not have the ability to afford universal healthcare," he said.

Assemblyman Michael Duvall also voted against the healthcare bill. In addition to being a Republican legislator from Yorba Linda, he is sole owner of the Michael Duvall Agency, an insurance company that received at least $10,000 last year from Blue Cross.

"I don't want the government in charge of my healthcare," he said to explain his vote, adding that it had nothing to do with his source of outside income.

Other legislators with outside businesses include:

* Assemblyman Edward Hernandez (D-West Covina). He and his wife are optometrists with private practices; his is in La Puente, hers in Duarte. Hernandez is also past president of the California Optometric Assn., which lobbied this year for legislation that significantly expanded the procedures optometrists can perform. Hernandez voted for the bill (SB 1406) in June as a member of the Assembly Business and Professions Committee and in August on the Assembly floor. Ophthalmologists, who are medical doctors able to perform more extensive treatment, including surgery, opposed it.

* Assemblyman Tom Berryhill (R-Modesto), owner and manager of Tom Berryhill Ranch, which grows grapes and almonds. Berryhill voted in June in favor of legislation that allows winery customers to consume the wine they purchase while still on the premises. The bill was pushed by the Wine Institute, a group that includes the Robert Mondavi Winery, a major source of income for Berryhill. The assemblyman said he supervises workers during the pruning season but otherwise doesn't spend much time in the vineyard.

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