Secret deals bend history backward

Bipartisan investigations by oversight committees of the Iowa General Assembly have confirmed disturbing reports of Gov. Terry Branstad administration's repetitive uses of employee termination agreements containing secrecy provisions and special payment clauses.

According to reports, numerous departmental directors appointed by Branstad, through these agreements, have bound ex-state employees to secrecy, secured that secrecy with payments of taxpayer money, diverted the termination arrangements from any public review by the State Appeal Board, and then hidden the sources of nearly $500,000 in payments from state legislators who have the constitutional duty to assure that appropriated funds are used only for specified purposes.

In Iowa Code section 8.38, titled, 'Misuse of Appropriations,' lawmakers have made unambiguously clear that state employees who expend funds or approve claims using appropriations for any purpose other than that for which those funds are appropriated, 'shall be liable for such sum so expended, together with interest and costs,' thereby reimbursing Iowa taxpayers.

The unprecedented frequency with which a host of Branstad administration executives apparently entered into secret deals with payoff provisions arguably has created exposure for political, if not legal, liability.

MERIT-BASED TO AT-WILL

The use of termination agreements containing both confidentiality clauses and hush-money provisions intensified almost immediately when, in October 2012, the Branstad administration succeeded in amending an administrative rule to permit the 'reclassification' of hundreds of state positions from merit-based to at-will jobs.

That amended rule significantly expanded the definition of 'confidential employees' — those who are presumed to have access to privileged information with executive-level department officials. That rule change has allowed one tier of merit employees who formerly had some job protection under the state's long-standing grievance processes to be replaced with a new tier of at-will employees, people presumably more responsive to the political direction of the governor and his appointed departmental directors.

Published statistics show that in each year of the Branstad administration the use of secret agreements increased: By 2013, the calendar year immediately following the 'confidential employee' definition rule change, nearly 20 percent of all state employee termination agreements have included nondisclosure agreements coupled with taxpayer-funded payments.

NEW 'SPOILS' SYSTEM?

The present trend, if unchecked, threatens to create a new 21st Century spoils system in Iowa. Once reclassified and terminated, merit-qualified state employees can be replaced with politically allegiant at-will appointees through a good-old-boy system dependent more on political cronyism than on the professional skills of job applicants.

Branstad and his various spokesmen have implied that prior administrations, such as that of Gov. Chet Culver, had similarly used secret settlement agreements that included payment provisions.

Such reports and implications of similarity could not be further from the truth.

In the Culver administration, no spoils-system administrative rules changes were advanced; no broad reclassification efforts were launched. Employee settlement agreements in those four years followed the normal course of state employee-grievance processes, following Iowa law.

Of the more than 600 settlements reached between management and labor representatives during the Culver administration, eight of them are known to have included nondisclosure provisions — and, only two of those agreements also contained payment clauses.

The largest of those two payments ($50,000) came statewide-elected Republican Secretary of Agriculture Bill Northey. Whatever the merits of Northey's agreement may or may not have been, surely, its existence cannot be ascribed to the Culver-Judge administration. The other, smaller (approximately $11,000) reported instance of a payment made did not directly involve the governor or his office.

The employment relations policies and processes used by Culver were consistent with Iowa law and practices used by former Iowa governors reaching back to the administrations of Democrat Harold E Hughes and Republican Robert D. Ray. The Iowa tradition of hiring and firing state employees based on the merits also rejects the use of spoils systems to reward partisan supporters of elected officials with state government jobs.

The Branstad Administration's reported antics, by contrast, are an assault on that tradition.

Employment termination agreements involving state employees should not be secret. No state government employee should ever be paid any extra amount of money in an attempt to keep his or her silence about such an agreement.

PEOPLE'S BUSINESS

Those state government executives who use appropriated taxpayer funds for unauthorized, undisclosed purposes should be held legally accountable.

The business of state government is the people's business. It is too important to turn over to a government run by those who have been hired through a political spoils system.

Gov. Branstad's efforts to bend Iowa history backward should be resisted at all costs, on all fronts, by legislators of all political persuasions

l James C. Larew, an Iowa City attorney, served as then-Gov. Chet Culver's chief legal counsel in 2007. Comments: James.Larew@LarewLawOffice.com