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City government should adopt a new code of ethics and give an ethics board the “teeth” to properly enforce the code but should stop short of enacting municipal campaign finance reform laws in its efforts to combat a “pay-to-play” system, according to recommendations from an ethics committee chaired by Philadelphia Common Pleas Judge Ida K. Chen. Chen’s is one of five committees that comprise Mayor John Street’s “Philadelphia 21st Century Review Forum.” The committees’ findings were published in a 176-page report released by the forum Thursday afternoon at a City Hall press conference. While not advocating “city-focused campaign finance reform,” the members of the ethics committee did recommend that Philadelphia’s executive branch work with other municipalities and state legislators to pursue a statewide campaign finance reform initiative, potentially modeled on a pay-to-play campaign contribution statute currently before New Jersey’s state assembly. However, there were findings in the committee’s report that addressed campaign contributions and the roles law firms, in particular, play in them. The committee’s subcommittee on campaign contributions, campaign finance and pay-to-play recommended that the city’s executive branch adopt regulations similar to the Municipal Securities Rulemaking Board’s Rule G-37. Rule G-37, according to the subcommittee’s findings, effectively limits to $250 the contributions for professionals involved in non-bid contracts with a city, whether they be associated with an engineering firm, an investment manager wishing to work for that city’s pension fund, a CPA firm desiring to be designated as accountants — or a law firm seeking to be designated as bond counsel or an underwriters’ counsel. “The subcommittee recognizes that application of a requirement modeled on Rule G-37 to all potential city of Philadelphia non-bid contractors might seem to incumbent elected officials and potential candidates for mayor to have a potentially cataclysmic effect on the availability of political contributions, especially contributions from law firms desiring to act as bond counsel or underwriters’ counsel,” the subcommittee’s finding states. It goes on to add, “Contrary to some doom-saying commentators, Rule G-37 has worked and the influence of political contributions on the selection of underwriters has substantially been eliminated.” The subcommittee also found that campaign finance reports should be posted on a city Web site, and that elected or appointed ward committee members should resign their positions before accepting any employment with the city. The subcommittee was chaired by Gregory Harvey, a public election law specialist from Montgomery McCracken Walker & Rhoads. Its members were Fred Voigt, executive director of the Committee of Seventy, and David Hyman of Kleinbard Bell & Brecker. The ethics committee included three other subcommittees. The subcommittee on gifts, ethics codes and personnel rules called for in its findings an “omnibus” ethics code that lays out in a single document rules currently found in a variety of documents, including mayoral executive orders, the city’s Home Rule Charter and Pennsylvania statues. That subcommittee was co-chaired by former city solicitor Charisse Lillie, who heads Ballard Spahr Andrews & Ingersoll’s litigation department, and the Rev. James Allen, pastor of Vine Memorial Baptist Church. Its members were Janet Perry, director of professionalism at Pepper Hamilton, and Michael Williams, a human resources consultant. The subcommittee on contracting and procurement noted that Montgomery County was able to cut bond counsel’s fees nearly in half in certain instances by soliciting proposals from a variety of firms before any service contracts were let. Among that subcommittee’s findings were that city managers should consider no fewer than three firms when awarding a no-bid professional service contract, and that, in an effort to fight the public perception that political contributions and the awarding of city contracts are connected, “serious consideration should be given” to the recommendation that donors of more than a certain amount not be granted city contracts. The contracting and procurement subcommittee was chaired by former city solicitor Ken Trujillo, currently of Trujillo Rodriguez & Richards. Its member was Patrick Eiding, president of the Philadelphia Council of the AFL-CIO. The subcommittee on enforcement, whistleblowing and discipline found that any city ethics board should enjoy independence, staffing and resources, influenced by the fact that other major cities’ ethics agencies have budgets of at least $1.8 million and staffs of at least 15 people, and also enjoy the power to enforce its sanctions after the Home Rule Charter has been so amended. The subcommittee also stressed the need for an apparatus, such as Los Angeles’ “whistleblower hotline,” through which citizens or employees could lodge their complaints. In its introduction, the committee’s report noted that the existing ethics board “had fallen into disuse over the course of several administrations” since the 1980s. (Campaign contribution subcommittee head Harvey is a former ethics board chairman.) The enforcement subcommittee was chaired by former City Councilman Daniel McElhatton, currently of his own law firm. Its member was Fran Fattah of Schnader Harrison Segal & Lewis. Chen and Voigt said in interviews with The Legal Intelligencer that the committee unanimously decided not to recommend a local campaign finance reform plan because of concerns that any such ordinance would conflict with existing state laws. Instead, Chen said, the suggestion for a G-37-influenced regulation was deemed a viable alternative because any such change could be made internally by city government. “We went around the [state] pre-emption issue by going to the procurement regulations,” Chen said. Voigt said that the majority of the committee was for such a change “in concept, if not specifically.” But on the whole, Chen said, the issue of pay-to-play — “real or perceived,” as the report states — was one that she felt needed to be readily addressed. “I got the committee to agree to affirmative steps on pay-to-play,” Chen said. Chen also noted the need for a single, comprehensive code of ethics that could be distributed to and easily understood by city employees. Williams, who specializes in employment law, drafted a proposed ethics code that was attached to the forum’s report with the help of Joseph Grace, who advised the ethics committee, and several Ballard Spahr associates. The proposed “omnibus Philadelphia ethics code” sets out guidelines on such issues as gifts, nepotism, conflicts of interest and outside employment. Williams said that while the majority of his draft’s points are already referred to in the numerous sources that govern city employees’ conduct, the omnibus code packages them in a single manual. “We wanted to draft it so that it would be easy for the average Philadelphia employee to understand,” Williams said. According to unconfirmed local media reports, Williams is a likely choice to head the Finance Department’s minority business enterprise council. At the press conference, Street applauded the ethics committee for taking the extra step of drafting an actual ethics code for his office’s review and that his office is “prepared to commit to” an omnibus ethics code. Street also said that in one year’s time, he would publicly announce which recommendations of the forum have actually been adopted. The ethics committee was aided by a team of research associates provided pro bono by Ballard Spahr. Street noted during the press conference that all of the forum’s committee members donated their time. Williams estimated that, on average, he dedicated 40 hours per week to forum work and said that he was sure his fellow committee members made similar sacrifices over the 12 weeks the committee met.

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