Bailout Transparency Fading Fast

The Tribune-Review reports Bloomberg News has filed a FOIA and a federal lawsuit seeking to force the disclosure of recipients who received $2 trillion in emergency loans from American taxpayers.

Despite Sec. Paulson's repeated promises that transparency would be a priority, instances of censorship continue. Banks claim revealing the names of these recipients could do more to harm their financial standings and Scott Talbott, senior vice president of government affairs for the Financial Services Roundtable, says, "You have to balance the need for transparency with protecting the public interest."

But transparency is in the public's best interest. If companies are willing to accept taxpayer funded loans they need to accept high standards of transparency.

People are searching for someone to hold accountable for the current financial mess. And while that may not be possible, given the scope of the meltdown, increasing transparency will bring needed accountability and help put an end to the constant cycle of finger pointing. Plus spending transparency allows the media and other outside groups to hold officials accountable instead of relying on the government to police itself. Just take a look at our state legislator if you think accountability can come from within.

For more on how transparency can lead to accountability click here.

State Spending Transparency Hearing

FYI by PLS has a brief summary of a hearing yesterday on proposals to create a state spending transparency for Pennsylvania, with particular attention paid to HB 1460 sponsored by Rep. Jim Christiana (similar legislation passed the Pennsylvania Senate last month). PLS subscribers can view the full summary. Rep. Christiana also has a summary of the hearing:

For everyone else, here is what you missed:

Sandra Fabry of the Center for Fiscal Accountability led things off (her testimony is here), testifying that 25 states have already enacted such legislation, typically for very little costs, and often resulting in dramatic savings. She dismissed claims that such a website would cost several million dollars.

Ed Martin, former chief of staff to Missouri Gov. Matt Blunt testified that they created the Missouri Accountability Portal without additional funding, with current staff preparing the system. He said their site has had 20 million hits, and constituents have found several examples of wasteful spending that resulted in changes in policy. He also commented that they report every dollar spent (vs. a $5,000 threshold in the proposed Pennsylvania legislation). The Missouri site has expanded to now include state employee salaries and tax credit programs, and they are working to help local governments develop similar sites.

Rep. Kasha Kelly from Kansas testified about the creation of KanView, noting as others had that the site was created for far less cost than projected, and has resulted in savings and cuts of some wasteful spending. She added that they also have no threshold for reporting of grants or expenditures, and that is easier to do than setting a minimum. She also noted that while some "big spenders" may have opposed the legislation, when it came to a vote, there was little opposition.

The Commonwealth Foundation spoke to the need to have greater transparency, using the current budget debate as a case in point, as well as refuting argument that this information was already available online. Rep. Kathy Rapp seconded that notion, noting that it was difficult even for lawmakers to get information about what specific line items actually fund. Elizabeth Bryan's testimony is here.

Finally, Terry Mutchler, Executive Director of the Pennsylvania Office of Open Records testified in support of the legislation. She commented that not only was transparency a good move for government, but an online website would dramatically reduce the number of Open Records requests state departments would receive - perhaps by 30% - saving staff time and resources. She suggested that the proposed time frame in the legislation be amended, as it was important to do transparency right, not just soon (Rep. Christiana concurred, noting the timeline would be amended based on how quickly the legislation moves through the process).

Update: State Spending Transparency

A reader emailed to ask if there are examples of states with online spending databases. Indeed states across the country are adopting transparency legislation while state officials and think tanks are working to create their own spending databases. Here are some recent developments:

• Georgia: Governor Perdue signed the Taxpayer Protection Caucus to create a website detailing expediture information with no dollar thresholds.
• In the meantime the Georgia Public Policy Foundation launched an education spending transparency website.
• Georgia's Secertary of State Karen Handel launched a Transparency in Government Initative.
• Arizona: In July the governor signed a law to establish a public database by 2011.
• Maine: The Maine Heritage Policy Center just launched a new website on state spending called MaineOpenGov.org
• Maryland: By January of 2009 a searchable database on grants and contracts over $25,000 should be available in response to recent legislation.
• Kentucky: Sec. of State Trey Grayson launched Check it Out Kentucky in June.
• Michigan: Attorney General Mike Cox has posted his office's expenditures and called on the governor to open the state's checkbooks.
• New York: State Comptroller DiNapoli launched Open Book New York. The Manhattan Institute launched SeeThroughNY in August.

All of these developments are great news for taxpayers, but not all databases are created equal. Here are some of the best examples:

• North Dakota's Sunshine on Schools
• Missouri's MAP
• Kansas's Kanview

For more information, with a complete list of projects in the states, go to ATR's FiscalAccountiblity.org and Show Me the Spending, maintained by NTU. To understand why spending transparency is a critical issue read my commentary here.

Transparency on PA's Stimulus Money

Governor Rendell announced his ideas for "oversight" of the funding Pennsylvania will receive from the federal stimulus (related story here), and unveiled a new website - recovery.pa.gov -  to promote transparency in the simulus spending.

While the website does breakdown how much stimulus money PA will get by category, and profiles some of the tax provisions for citizens - indicating someone read the bill - I'm not overly impressed with the promised level of transparency.

For example:

A key provision of the federal recovery is regular public reporting of project status, spending, and job creation and retention.  These quarterly reports will be made available on this website

As I suggested before, a continually updated checkbook register would offer far better transparency and accountability.  

As for the level of detail under the FAQ for "Where is your money going?", we get answers like this:

Pennsylvania’s young people will benefit from more than $2.5 billion for tuition assistance and improved public education.  ...


The economic recovery plan provides an estimated $4 billion to increase access to quality health care for elderly, disabled and low-income Pennsylvanians, as well as other assistance programs.

That's not transparency, it's marketing slogans.  They might was well write, "We'll spend lots of money, and it will be awesome."

CF Now: Opening Pennsylvania Government

View our newest video on YouTube, highlighting current efforts to create more government transparency in Pennsylvania.




Here are some of the key resources on Open Government:

CF Projects

• Pennsylvania Votes:  Tracking legislation before the Pennsylvania General Assembly, including a lay-person's description of each bill, roll call floor and committee votes, and the ability for users to comment on each bill and discuss topics in the forums.
• School Board Transparency: A project to help improve transparency in school district labor contract negotiations, including a blog discussing developments and best practices, an honor roll of school districts providing transparency, and a guide to school contracts on Sunshine Review.

Collaborative Efforts

• Sunshine Review: Sunshine Review, a project of the Sam Adams Alliance collects and shares information about government transparency, openness and accountability at the state and local level.  Individuals and organizations can contribute to provide information about their government.  Related sites include Ballotpedia (on ballot initiatives and referenda) and Judgepedia.
• Show Me the Spending: A project led by the National Taxpayer's Union, involving a coalition of groups working to provide greater info on state (and local) government spending.  The Commonwealth Foundation has help by providing links to information on the Pennsylvania budget.
  

Resources

• Pennsylvania Office of Open Records  
• Pennsylvania eContracts Library (from the State Treasurer's Office)
• Pennsylvania Freedom of Information Coalition
  

Cost and Benefits of State Spending Transparency

The Mercatus Center has a new podcast on state online spending transparency.  Jerry Brito, senior research fellow at the Mercatus Center, discusses the need for spending transparency in states through online databases and searchable open books.   He says that criticism (coming mostly from legislators)is unfounded - these websites are inexpensive and that states that have built these websites have spent an average of $140,000.

The Commonwealth Foundation has advocated the need for spending transparency in Harrisburg on a consistent basis, such as HB 1460 or SB 105. Many states have already seen the need for some sort of an "open book" on government spending.

Kansas is one of the first states to pass substantive transparency legislation and boasts one of the most comprehensive online databases for government expenditures. Other outstanding examples include Oklahoma’s OpenBooks website and Missouri’s Accountability Portal, which also provides the salaries of government employees.

Open Records Are Not Optional

Editors of The Morning Call criticize Allentown mayor Ed Pawlowski for attempting to keep the cost of police contract negotiations secret despite the city’s home rule charter which specifically states all contracts shall be available for public inspection. The Morning Call writes,

“But he [the mayor] was wrong to believe that the public's right to know is optional or a protection in force only when he says so.”

Sacrificing transparency for the sake of strategy fuels bloated benefit packages and inflated salaries among union employees, which in turn jeopardize the profitability of the entire business (i.e. the auto industry and the UAW). While not specifically designed for municipal police negotiations, SchoolBoardTransparency highlights some of the best practices in regards to public transparency in school board negotiations.

Transparency actually discourages wasteful spending, the sunshine review has numerous stories explaining the benefits of open government. Kudos to The Morning Call for pointing out that transparency is not a matter of convenience.

Transparency Needed in Pennsylvania Budget Debate

ABC 27 has a news story and video on proposed legislation that would create an online portal and database of state spending in Pennsylvania.

What is most disappointing are comments by Chuck Ardo, Gov. Rendell's spokesman.  Earlier this month, Ardo stated with regard to this legislation, "It sounds like the right thing to do."  What happened?  Yesterday, here is Ardo's response:

The Governor's Office said that's nothing new.  "Most of what that bill calls for is already available on the Internet," said Governor's Office spokesperson Chuck Ardo. "All government contracts are listed on the Treasurer's website."

 Really?  If a legislator, reporter, or taxpayer wanted to weigh in on the current budget debate, and wanted to find out what a specific line item was funding, could they do so?  I challenge Ardo to try it sometime. 

Take something innocuous like "Economic Advanvcement" in the Department of Community and Economic Development. It received $17 million in state funding last year - Governor Rendell has proposed cutting it in half, and the Senate Budget eliminated the line item.  What does it fund?  I find impossible to tell using the Internet - it isn't listed as a program in the DCED "Investment Tracker".  Are there contracts for these funds?  Doubtful, and even so, who is willing to browse through the 772 pages (7,722 contracts) of DCED contracts on the Treasurer's site.

The Treasurer's contract database site is a worthy effort to promote transparency, but is limited to state contracts, and is not easy to use if you aren't searching for a specific vendor.  For instance, I was able to discover that the Treasurer's contracted with Koryak  Consulting to build the site - original contract for $372,000 and additional features added for $84,850 - but only after browsing through 100 contracts.

Contrast that with Kanview - the spending database for Kansas (which cost a mere $100,000) - where users can go through the budget by agency and then program by program (as well as several other categories) to find out where money is going.  It is this kind of spending transparency we need to help inform the current state budget debate.

Fourteen states already have online spending databases or transparency portals, as does the federal government (through bi-partisan legislation sponsored by then-Sen. Obama and Sen. Coburn).  It is time Pennsylvania and the Rendell administration get on board.

Transparency and the Bailout

Transparency is a popular buzzword these days, but does the rhetoric reflect reality? John Stossel investigates the lack of transparency surrounding the bailout.

Transparency for PA Stimulus Money?

State Senator Mike Brubaker has a proposal to create greater oversight over how Pennsylvania spends its transparency money (HT: John Micek at Capitol Ideas).  The proposal has two components - an oversight commission consisting of four cabinet members, four legislative appointees, and citizen; and a website for information on how the stimulus money is being spent.  Congressman (and possible gubernatorial candidate) Jim Gerlach made similar recommendations last week, though the oversight board would be more citizen driven.

Personally, I put little faith in any oversight of spending by the people doing the spending - or even consisting of folks appointed by those doing the spending.  Pennsylvania's history with commissions - e.g. the Turnpike Commission, the Gaming Control Board, the Philadelphia Parking Authority, the Commonwealth Financing Authority, and all the local government authorities running hotels, airports, and golf courses - isn't very inspiring.

However, giving the public oversight by putting all the stimulus spending online is critical.  A "neutral, fact-based web site" with "at least basic information about the federal stimulus" is not sufficient.  The website needs to be comprehensive, and should track every dollar spent - basically putting the checkbook register online.

While Micek makes a crack about this website appealing to "people with entirely too much time" on their hand, we only need a few watchdogs.  With full transparency, citizen activists, bloggers, and even people who get paid for this type of thing - including Micek and myself - will do more to ensure accountability in government spending than any oversight commission.

78-Group Coalition Demands Greater Bailout Transparency

The Commonwealth Foundation has joined 77 other organizations in calling for greater transparency for taxpayers in the numerous bailouts being handed out with little oversight.  From the news release:

The letter notes that nearly half of the $700 billion committed to the Troubled Assets Relief Program has already been distributed with very little transparency and almost no oversight -- in addition to another $800 billion being spent by the Federal Reserve. The letter recommends requiring that the Department of the Treasury, the Federal Reserve, and other government entities involved in the bailout collect and make available to the public information on certain aspects of how bailout aid is being spent by recipients.

BailoutTransparencyLetter

Shining Some Light on Pennsylvania Spending

Kevin Ferris has a good piece in the Philadelphia Inquirer on proposals to create online databases of state spending in Pennsylvania, as well as the success of other states in creating spending transparency.  Specifically referenced are legislation introduced in the Senate by Pat Browne and legislation proposed by Rep. Jim Christiana with bi-partisan support. 

Even Gov. Rendell's spokesman, Chuck Ardo, is on board, saying "It sounds like the right thing to do."  We agree:

• Open the Books on Government Spending
• Government Spending Databases are Cheap
• Open government should save taxpayers, not cost them
• Update: State Spending Transparency

For additional resources on state spending transparency check out the Center for Fiscal Accountability and the Show me the Spending Coalition.

NTU calls for Spending Transparency in PA

The National Taxpayers Unions has sent a letter encouraging passage of a spending transparency website.

The legislation, SB 1350, was introduced by Sen. Browne in April.

For more on spending transparency check out Show Me The Spending. For examples of spending websites, visit USAspending.gov (for the federal government) or KanView (for Kansas).

Two Cheers for Transparency

Good read on transparency effort in state government by Larry Reed in the latest issue of the Freeman.

Evaluation of Pennsylvania School District Websites

Our friends at the Sam Adams Alliance have reviewed websites from all 501 school districts in Pennsylvania on their Sunshine Review wiki.  They found that there is a long way to go in providing transparency to citizens.  As a wiki this site is user-driven, there is plenty of need for average citizens to review how open their own school district, county, or city governments are.

Our School Board Transparency project (which includes both a blog highlighting best practices and a guide on Sunshine Review) is an effort to help school boards and citizens remove some of the mystery in contract negotiations.

On Specter's Economic Remarks

Roxbury News has posted video of Arlen Specter's remarks yesterday (part II here) at the State Capitol.  Three things really bother me regarding his defense of his vote on the stimulus:

1) "The Stock Market Dropped 800 points when the House failed to pass the bailout."  Are you kidding me?  They are still using this drivel?!?  Yes, the Dow did drop sharply on Sept. 29 - but they rebounded then next day, when the bailout was in doubt, and then dropped after the Senate passed the bailout, and dropped again after and coinciding with the House passage of the bailout.  The Dow continued to drop after the bailout passed, after Obama was elected, and after the stimulus passed.  In fact, the Dow was over 10,500 when the stimulus passed ... wouldn't you like those golden days back again?

2) Our economic problems are "much more serious that is publicly disclosed."  Really, after months of Bush, Paulson, Bernanke, and now Obama telling the public that we are facing another Great Depression, Specter tells us its worse than that/  His evidence - top secret economic data than cannot be revealed.  I've made this argument repeatedly - but if the government has economic data that they are making enormous policy decision on, why are they not sharing it with the public?  Aren't we supposed to be in a new era of government transparency?   I would compare this to the run-up to the Iraq War, but that would be unfair to the level of transparency in intellegence info the public got on Iraq.

3) Paraphrase: Bush's Bailout and Obama's Stimulus are twin brothers - showing both parties are behind this. I agree that both big spending policies are the same. But apparently it never occured to Specter that both parties are overspending, serving special interests rather than taxpayers, trying to appear to "do something" rather than following sound economic principles, and repeating the same failed mistakes of the past.   

More news on Government Reform

Round-up of a number of stories today on the push for government reform and transparency:

• Steve Samuelson has worked out a compromise with Babette Josephs - who stymied his previous redistricting effort - on redistricting reform. The new plan would offer greater transparency and guidelines for the redistricting process. However, legislators would continue to control the process. Both Barry Kauffman and I remark that this is a positive step - but the previous bill that Rep. Josephs killed was better.



• A new poll from Susquehanna Polling finds that 69% of midstate voters want a special session on government reform - starting now.



• The Senate GOP calls for Governor Rendell to get more grant contracts into the new online database. Though the Senate itself has very little information available.

Transparency: A Priority in the Senate?

In early July, the State Treasurer's office revealed the new PA Contracts e-Library as required by the recent Open Records law. The database posts government contracts and grants in an effort to increase transparency and accountability.

On July 23rd Senator Scarnati and Senator Pileggi sent a letter to Governor Rendell "urging" more government agencies to put their contracts online. But guess whose contracts are missing from the database? You guessed it, the Pennsylvania Senate's. So we sent the Senate leadership (and House leaders - whose own information is lacking) a letter asking them to lead by example.

PA Contracts e-Library Letter - Upload a Document to Scribd

Read this document on Scribd: PA Contracts e-Library Letter

Great Website on Fiscal Responsibility

Americans for Tax Reform has launched its Center for Fiscal Responsibility, a fantastic site dedicated to (as the name implies) fiscal responsibility in federal state and local government.  I recommend you bookmark this page and sign up for their email list.

Of special interest is their transparency in government section, highlighting successes at both the state and the local level with an FAQ on Transparency

They also have a good section on federal spending, model legislation for state lawmakers, and a lot of links.

Transparency: Increase Government Efficiency for Free

The House Democratic Caucus has demonstrated fiscal responsibility by rejecting this year's COLA's. Maybe Dr. Stilp got through to them. But the bigger question is how much did Eachus turn around and spend on Sen. Casey's brother for a "top-to-bottom" review of the caucus's efficiency? Do we really need to spend money to save money?

I don't think so. Kansas put the entire state's expenditures online without spending a dime.

Putting legislative leadership expense accounts online would act as a deterrent to excessive spending and allow each citizen to see how his tax dollars are being spent in the caucuses. The assembly's reluctance to embrace transparency makes one wonder what it has to hide. . . .