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Scott's financial conflict: unethical, legal

Gov. Rick Scott has a clear conflict of interest between his public job and his private finances. The controversial policies he is pursuing as governor clearly would benefit the health care company he co-founded and increase the value of his family's investment. Such a blatant example of a public official pushing changes that would financially benefit himself is banned by the federal government and most other states, but in Florida anything goes.

It is no secret that Scott co-founded Solantic Corp., a chain of urgent care centers, and that he estimated the value of his holdings in the company at $62 million. His feeble attempt to avoid a conflict of interest by placing his Solantic shares in a revocable trust in his wife's name before taking office in January also has been publicly noted. What has become clearer during the legislative session is just how much Solantic — and Scott's family — could benefit from the policy changes he so strongly advocates.

The governor and the Legislature are expected to force millions of Medicaid patients into managed care organizations, and Solantic contracts with private Medicaid plans. Scott also wants the Legislature to force all adults on welfare to submit to drug tests, and he has ordered constitutionally suspect random drug tests for state employees. Solantic performs these drug tests, although a company official told the Times' Kris Hundley that the company would not bid on testing state workers as long as Scott's shares are in the trust. That concession pales compared to what the company stands to gain from its co-founder moving into the Governor's Mansion.

The impact of Scott's general hostility to publicly provided medical treatment is even more difficult to measure. He wants to cut money to county public health departments, which could drive patients to Solantic for physicals and immunizations. He has appointed a commission to review the viability of public hospitals, and diminishing the role of those hospitals or forcing them to become private could push patients — at least those who have insurance or can pay the bills — to Solantic. The public has no choice but to trust the governor and Solantic more blindly than Scott is handling his finances.

Scott recognized the potential conflict before he was sworn into office, but there were cleaner ways to address it than placing his stock in his wife's revocable trust, where it can be withdrawn at any time. He could have sold his stock. He could have sought a formal advisory opinion from the state Ethics Commission instead of informally asking the commission's staff about precedent. He could have created a blind trust controlled by someone other than a family member. Instead, Scott resorted to a gimmick that fools no one.

Alex Sink, who lost to Scott in the general election, placed $10 million in personal assets into a blind trust managed by personal friends after she was elected chief financial officer in 2006. While imperfect, that was a far better approach. Scott would not have been left to his own devices if the Legislature had approved the necessary reforms. Legislation (SB 86) sponsored by Sen. Mike Fasano, R-New Port Richey, would require the governor, lieutenant governor, CFO, attorney general and agriculture commissioner to place their assets into blind trusts managed by nonrelatives where the beneficiary could not control the assets. Politicians would disclose what assets were placed in the blind trusts at inception, but the trusts' holdings would be shielded after that and the politician would report trust income on state financial disclosure forms.

Of course, the Legislature has failed to passed those reforms in previous years. Now Florida suffers the consequences with a governor whose public policy and private finances are intertwined — and the scandal is that it is perfectly legal.

Scott's financial conflict: unethical, legal 04/04/11 [Last modified: Monday, April 4, 2011 6:44pm]
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