THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Wednesday, May 24, 1995 TAG: 9505240001
SECTION: FRONT PAGE: A10 EDITION: FINAL
TYPE: Editorial
LENGTH: Medium: 67 lines
Let's say you contributed to Gov. George F. Allen's gubernatorial campaign and were appointed to oversee a panel studying which state jobs to turn over to the private sector.
Let's say the panel recommended privatizing a service that you, while a high-ranking state employee, recently oversaw.
Let's say a company you partly own gets picked by the state agency you used to work for to provide that service - after two state employees who used to report to you give unusually low marks to your closest competitor. It all sounds cozy, and the service contract your company gets is worth up to $270,000 a year.
So do you have a conflict of interest?
Apparently not in Virginia, where conflict-of-interest and ``revolving door'' statutes are a sieve with a tear in the bottom. You had the inside track in getting the service contract, but not an illegal conflict of interest.
What's described above is an actual deal made last week. The attorney general's office says the deal fails the ``smell'' test but violates no state statutes.
Here's the deal:
G.G. ``John'' Crump III, a former assistant director in the state comptroller's office, is vice president and principal investor in Employers Resource Management Co., which just got a service contract from the comptroller's office to administer some 30,000 supplemental insurance policies that state employees pay for through payroll deductions.
Crump, who with his wife donated $1,375 to Allen's 1993 gubernatorial campaign, oversaw Allen's ``Strike Force'' on government reform when it recommended that scores of government services be privatized.
In a Jan. 30 letter to the comptroller's office, from which he then was on paid leave, Crump extolled his own qualifications to receive the contract for one of those services: ``Mr. John Crump, until recently the assistant comptroller for the Department of Accounts, uniquely understands more than any other potential service provider the miscellaneous deduction administration needs of the commonwealth.''
In an interview last week, Crump said, ``My experience gave me a competitive edge both in obtaining the contract and providing the service.''
As explained by staff writer David M. Poole in an article Sunday, under Virginia's ``revolving door'' policies, Crump could not receive the state contract as an individual, because he had taken a special early retirement deal from the state. But he still could be part owner of a business that used his connections to close the deal.
Most barn doors are smaller than loopholes in the Virginia ``revolving door'' statutes and policies.
With Allen bent on privatizing a wide array of state government functions, including prison construction, highway design and liquor sales, the loopholes need to be closed so businesses without ``inside'' government connections compete for state contracts on a level field.
Virginia Finance Secretary Paul Timmreck raised the question, ``Is it fair to deny former state employees an opportunity to get out there and get involved in private business?''
The answer is yes - at least for a couple of years - if that business is going to take over a state function.
Allen and legislators need to study ways to keep the ``smell'' of conflict of interest from rising again as more state functions are turned over to private enterprise.< by CNB