Calls for New Rules Limiting The Council's Ability to Accept Campaign Contributions from the Utilities They Regulate
By Jesse George, New Orleans Policy Director, AAE
On June 25, 2021, the Greater New Orleans Interfaith Climate Coalition sent a letter addressed to the New Orleans Ethics Review Board and copied to the entire City Council, calling for an amendment to the Code of Ethics prohibiting City Council candidates and incumbents from accepting campaign contributions from Entergy, the New Orleans Sewerage & Water Board, and other regulated utilities, as well as from their executives and political action committees. The letter further calls for a ban on campaign contributions from persons or firms that contract to provide services to the Council, such as the Council’s utility advisors. Finally, the letter calls for disclosure by candidates seeking the office of City Council of any financial or other compensation received from regulated entities or contractors within the past five years, or any board service rendered to the same at any time.
At its regular monthly meeting on July 12, 2021, the Ethics Review Board took this proposal under consideration. At that time, the Board elected to table the matter for discussion at their August 2021 meeting, in order to provide time to conduct legal research on the issue.
As both a legislative body and the regulator of a publicly-owned electric and gas utility, the New Orleans City Council has enormous power to affect the everyday lives of New Orleanians. High bills and unreliable service are common, and citizens have watched in recent years as Entergy has astroturfed City Council meetings in order to push through its unpopular gas plant in New Orleans East, mismanaged its Grand Gulf nuclear plant at a cost of millions to ratepayers, and left thousands freezing in the dark during Winter Storm Uri in February.
Public officials should strive to instill confidence in electoral and regulatory processes. Even the appearance of impropriety or favoritism is fatal to that public confidence. A prohibition on campaign contributions from regulated entities and those that receive lucrative public contracts -- the utility advisors’ contracts alone amount to nearly $7M annually -- is a simple and necessary measure in order to ensure the integrity of our elections and good governance in our city council.
An ethics rule like this has a precedent, as near as Mississippi, where a statute has disallowed campaign support flowing from the regulated to the regulators for years. Since 2006, the Council has taken steps to attempt to reduce the influence or appearance of impropriety through resolutions that only apply to the sitting Council members who vote on the resolutions. This means challengers or new candidates for Council are not required to follow these resolutions. The Council’s latest resolution, which is still not a permanent solution, does “encourage” other candidates for Council to eschew campaign funds from utilities and consultants, but cannot be enforced in any way.
Qualifying is underway in New Orleans for the 2021 municipal election.
July 15, 2021 Update
The Council passed Resolution R-21-268 limiting the Council's ability to accept campaign contributions from the utilities they regulate, the Council's utility advisors, and other consultants with professional service contracts to assist the Council.