Idaho needs ‘cooling off’ law to avoid conflict after $1.2 billion contract award | Opinion

Revelations that a company that was awarded a massive $1.2 billion state contract hired three state employees — including one employee involved in evaluating the company’s bid — illustrates the need for Idaho to pass so-called “cooling off” legislation.

Idaho is one of only seven states in the country that doesn’t have some sort of cooling-off or revolving-door restrictions, which bar or delay state employees or legislators from going to work for a company that does business with the state government.

As reported by the Idaho Capital Sun, Magellan of Idaho last year was awarded the $1.2 billion Idaho Behavioral Health Plan contract — Idaho’s largest state contract — to manage Idaho Medicaid mental health benefits.

Magellan won that contract, in part, based on scores it received from a team of evaluators. One of those evaluators was Idaho Department of Health and Welfare employee David Welsh, who was later hired to be Magellan of Idaho’s CEO.

Welsh, former Idaho Department of Health and Welfare deputy administrator for Medicaid benefits, evaluated bids for the contract and gave Magellan’s bid the second-highest score among the evaluators.

In addition, two other state employees from the Department of Health and Welfare were hired by Magellan, according to the Idaho Capital Sun.

We are not suggesting wrongdoing, but the appearance of impropriety or conflict of interest can create a lack of trust in state government.

And when you’re talking about hundreds of millions of dollars at stake, the opportunity and temptation for wrongdoing are high.

States without cooling-off laws

Only Idaho, Illinois, Michigan, Nebraska, New Hampshire, Oklahoma, and Wyoming do not have any sort of cooling off laws, according to a 2019 report from Public Citizen, a national nonprofit consumer advocacy organization advocating on behalf of the public in government affairs.

Several states have “revolving door” or “cooling-off” laws that restrict state employees from immediately going to work for private companies that have contracts or business dealings with the state government.

Permanent ban in some states

For example, California, New Mexico, New York, Mississippi and Texas impose a permanent ban on former state employees working on the same specific contracts or matters they were personally and substantially involved with while in public service, according to the National Conference of State Legislatures.

A permanent ban seems extreme to us, but it demonstrates how seriously some states take the issue.

Other states impose varying degrees of a cooling-off period.

Over a dozen states, including Missouri, North Carolina, Oregon, South Dakota and Texas (for certain officials), have a two-year cooling-off period restricting lobbying or working on the same matters as when in state government, according to the National Conference on State Legislatures.

That seems more reasonable to us, certainly more reasonable than no cooling-off period at all.

Shorter cooling-off periods

The most common cooling-off period is one year, which 24 states have for restricting lobbying activities by former state officials and employees, according to NCSL. This includes Alaska, Connecticut, Delaware, Hawaii, Indiana, Maine, Maryland, Minnesota, Pennsylvania, Rhode Island, South Carolina, Utah, Virginia, and West Virginia.

A few states, such as North Carolina, have a six-month cooling-off period.

Counterargument

The Idaho Department of Health and Welfare told the Capital Sun that it’s beneficial for Idaho government employees to leave for private sector jobs because those employees have expertise in their field.

Further, it makes sense as the Department of Health and Welfare reduces its workforce, for some employees go into the private sector in the field in which they are experts.

“I’d rather have the smartest people working on the implementation, than the guy who wasn’t involved in any way, shape or form,” Idaho Association of Community Providers lobbyist David Lehman told the Capital Sun.

But we are concerned when those employees go to work for a company with which they were directly involved as a state employee and especially if they were directly involved in awarding a state contract worth hundreds of millions of dollars.

Poor track record for integrity

Idaho has a history of poor scores when it comes to state government integrity.

Idaho received a D- score in both 2012 and 2015 from the Center for Public Integrity, an independent, nonpartisan and nonprofit news organization that investigates systems and circumstances that contribute to inequality.

Idaho received poor scores for, among other things, ethics enforcement agencies (F, 49th in the country); lobbying disclosure (D+, 17th); and state civil service management (F, 36th), which includes oversight of state employees engaged in corruption.

There is little evidence things have changed since these studies.

Idaho should join the other 43 states in the nation and pass some sort of cooling-off legislation for legislators and state employees.

It doesn’t have to be a permanent ban, but a modest period, such as a year or two would be a reasonable period. It would go a long way toward bolstering trust in state government.

Statesman editorials are the unsigned opinion of the Idaho Statesman’s editorial board. Board members are opinion editor Scott McIntosh, opinion writer Bryan Clark, editor Chadd Cripe, newsroom editors Dana Oland and Jim Keyser and community members Greg Lanting, Terri Schorzman and Garry Wenske.