Labor unions are well represented in both the Rhode Island House and Senate.

01:00 AM EST on Sunday, January 23, 2005

BY KATHERINE GREGG
Journal State House Bureau

PROVIDENCE -- Out of last year's political scandals came a law that is shedding new light on the financial ties between some of the state's part-time, $12,285-a-year lawmakers and major corporate and union players at the State House.

In the first batch of filings made last week, it was reported to the public that:

Several high-ranking Democrats in the House and Senate are not only pro-labor boosters on Smith Hill but also full-time union employees.

Among them: Senate Whip Dominick J. Ruggerio, who gets $163,717 in salary and benefits as the administrator of one arm of the Laborers' International Union of North America, and Deputy House Whip Paul Moura, who receives $91,663 in salary and benefits as a field representative for another arm of the Laborers' union.

State Rep. Peter Ginaitt doubled last year as a $69,271-a-year rescue captain in the Warwick Fire Department and an $82,992-a-year, full-time emergency preparedness coordination officer at Rhode Island Hospital.

Rep. Arthur B. Handy, a former State House lobbyist for the American Lung Association of Rhode Island, remained on the group's payroll as its $38,198-a-year director of communication and advocacy after winning his House seat.

Former Senate President William V. Irons made far more than previously known from his undisclosed business relationship with the state's largest health insurer, Blue Cross & Blue Shield of Rhode Island.

The Journal had previously documented commission payments by Blue Cross, to Irons, of up to $42,189 over the course of an entire year for his disputed role as the "broker of record" for a single client: the Woonsocket-based CVS drugstore chain.

A senior Blue Cross account executive was quoted last June as saying he and the company's vice president for sales objected to Irons being paid broker commissions on the CVS account because others "did all the work." But the Blue Cross officials were overruled.

In a first-of-its-kind report filed last week, Blue Cross acknowledged paying $77,047.84 in "broker commissions" to Irons last year for policy renewals during a three-month stretch that marked his final months as a legislator. Blue Cross would not comment further on how much that represented of his annual earnings from the company, or the number of clients it reflected.

The filings are the result of a new law sponsored by Sen. J. Michael Lenihan and passed by the General Assembly with unanimous support last year after The Journal brought to light a series of undisclosed financial ties between high-ranking lawmakers and the health industry.

Irons resigned as Senate president on New Year's Eve 2003, and quit the Senate entirely last February amid a swirl of questions about his hidden financial connections.

JOHN A. CELONA, the former chairman of the Senate committee that handled legislation affecting the health-care industry -- including a pharmacy-choice bill vehemently opposed by CVS -- also resigned after it came to light that CVS had been paying him an unreported $1,000-a-month retainer and that Blue Cross was subsidizing a cable television show that featured him.

The new law requires any entity that employs a lobbyist to disclose by Jan. 15 of each year "anything of value" -- defined as anything worth more than $250 -- that it gave or promised "any major state decision maker," including state agency directors, judges, legislators and other elected state officials during the previous year.

Anything of value is further defined as "any fee, salary, commission, expense allowance, forbearance, forgiveness, royalty, rent, capital gain, gift, loan, reward, favors or services, gratuities or special discounts, or any other form of recompense that constitutes income in the federal Internal Revenue Code."

The law was aimed at bringing to light the financial relationships between lobbyists and legislators that were not always -- as evidenced by the Irons and Celona cases -- being reported on the annual disclosure statements that public officials are required to file with the state Ethics Commission.

SOME LAWMAKERS resent having their salaries made public. Some question the need, including CVS employee and state Rep. William J. McManus, who said last week: "Celona didn't even say he worked for CVS. That's different."

But H. Philip West, executive director of the citizens' advocacy group Common Cause, said the added disclosure requirement was intended to "put people on notice there are no more side-door ways to get compensation and keep it from public view."

Potentially, the new reporting requirements applied to all 673 registered lobbyists at the Rhode Island State House last year and the 414 registered entities for which they worked, from Walgreens to Harrah's Entertainment to Lifespan and the Rhode Island Bankers Association.

In response to questions after the deadline had passed about who had to file and who didn't, a spokesman for Secretary of State Matthew Brown said only those who hit the $250 reporting threshold had to file.

By then, however, reports had already flooded in from dozens of companies and interest groups stating for the record that they gave nothing of value to anyone in Rhode Island officialdom.

Among those filing such disclaimers were: GTECH, the West Greenwich-based lottery giant, and Harrah's, the Las Vegas company on the verge of mounting another State House campaign for a West Warwick casino.

Others with a major presence at the State House filed nothing, including one of the two companies at the center of the Celona hidden-connections controversy: CVS.

Initially, CVS spokesman Todd Andrews said the company did not file because "to the best of our knowledge and information, CVS did not provide any gifts or payments that would trigger the reporting requirement."

Confirming he still works for the company and makes about $125,000 annually in salary and incentives as an assistant manager in merchandising, McManus, R-Lincoln, said Friday: "It has never been a secret I worked for CVS."

Asked why the company did not report this, Andrews issued a second statement: "We do not believe that the intent of the new regulation, still in its first year of implementation, is for employers to report how much they pay any employee who happens to be a member of the General Assembly when that employment is a matter of public record. If the secretary of state has a different interpretation, we will respond appropriately."

Through a spokesman, Brown, the official responsible for administering the law, said: 'Yes, CVS has to report."

WITH RESPECT to cities with lobbyists, such as Providence and Pawtucket that between them had at least eight legislators on their payrolls last year, Brown's spokesman, Peter Kerwin, said: "if they employed a lobbyist and have met the $250 threshold, they must file."

But, he said, the office needs more time to determine who, if anyone, is responsible for reporting Senate Minority Leader Dennis Algiere's employment as a vice president at the Washington Trust Company when the bank itself doesn't have a lobbyist, but the Rhode Island Bankers Association does.

Presumably, the same kind of question would apply to legislators working for different arms of a union or hospital network.

In the uncertainty, some opted for disclosure, including Rhode Island Hospital, which has no lobbyist of its own at the State House but is a member of the Lifespan hospital network, which does.

In addition to disclosing how much it pays Ginaitt, the hospital appended an explanation of how it came to hire the Warwick Democrat a year and a half ago as its emergency coordinator after winning a bioterrorismpreparedness grant from the state Department of Health.

"Mr. Ginaitt was selected for this role by Rhode Island Hospital after a search because of his professional expertise and experience."

THE UMBRELLA organization for most of the state employee unions had a clearer path.

In a report filed more than a week early, Council 94 of the American Federation of State County and Municipal Employees put in writing something that was already widely known: Sen. John J. Tassoni Jr. of Smithfield was on its payroll.

What was new was the amount the union organization paid Tassoni, who is now a deputy Senate majority leader, to serve as its business agent last year: $79,060 in salary alone.

Three other legislators working full-time for various branches of the Laborers' union had a more difficult time deciding what, if anything, their employers had to report.

On Wednesday the union disclosed how much side income Ruggerio, the Senate whip, and Sen. Frank A. Ciccone III, made as elected officers of the Laborers' union affiliate known as Local 808, Rhode Island Judicial, Professional & Technical Employees.

Ruggerio received a reported $6,000 a month as the secretary treasurer; Ciccone, $15,600 as the business manager for the local that represents about 17 bargaining units within state government, including RIPTA, E-911 and court employees, plus a number of Johnston school employees.

But it wasn't until later in the week, that the other Laborers' union affiliates that employ Ruggerio, Ciccone and Moura filed.

Up until that point, the three Providence Democrats said they were not sure what was required to be filed.

Of the three, only one, Ruggerio, works for an affiliate -- the New England Laborers' Labor-Management Cooperation Trust -- that had a registered lobbyist at the Rhode Island State House: former Sen. John Orabona.

Moura is a health and safety field specialist for the New England Laborers' Health & Safety Fund, one of the many Laborers' union offshoots chaired, at least until recently, by Armand E. Sabitoni, the Laborers' union's general secretary-treasurer and New England regional manager.

Ciccone is a field representative for the Rhode Island Laborers' District Council headed by Ronald Coia.

"This is new. I don't think they are aware of it," Ciccone said in a brief exchange with Moura at the State House before the reports were filed.

"But I don't have a problem telling people what I make," Ciccone said.

Moura's reply: "Maybe they should file out of an abundance of caution."

Ciccone: "No big deal."

Moura: "That's fine with me, too. When they see how little I make, they'll realize its no big deal anyway."

Added Ruggerio a short time later: "I didn't think we were obligated to file that, but we're going to file anyway because obviously we have nothing to hide."

On Thursday, the three Laborers' union affiliates laid it on the table: Ruggerio received $163,717 in salary and benefits last year; Ciccone, $135,177; and Moura, $91,663. In salary alone, Ruggerio estimated his pay at $122,000; Ciccone, at $80,000; and Moura, at $55,000.

The three are among the most prolific sponsors of legislation dealing in one way or another with labor issues, employee legal rights and, in Ciccone's case, a bill to eliminate lifelong tenure for judges.

Not all of the reports that came in last week dealt with interconnections between lobbyists and legislators.

Blue Cross said it provided $19,363 in fees and health insurance benefits to Sheldon S. Sollosy, the chairman of the state board that oversees Rhode Island's public television station, for serving as a member of its own board of directors.

The insurer also disclosed the $21,500 it paid Superior Court Judge Edward C. Clifton as a board member until the stipends were suspended, as required by another new law, in July.

OTHERS cited exemptions that are not spelled out in the law.

For example, Verizon and Narragansett Electric acknowledged providing service to "numerous state decision makers." But they named none because, using identical language, they said their companies had not "provided any discounts or rate reductions exceeding $250 to any of these individuals in 2004, other than through promotions available to other . . . customers."

Similarly, several lobbying clients of the Providence law firm, Adler Pollock & Sheehan, said they did not have to file.

"This entity may or may not provide or offer goods or services to major state decision makers within the normal course of the entity's day-to-day operations," wrote one such client, Tereann Greenwood, the executive director of the Veterans Memorial Auditorium.

One of the firm's lawyers, Richard R. Beretta, advised the secertary of state: "In the ordinary course of business, the firm may represent major state decision makers." But, aside from the firm's publicly registered lobbying clients, which range from Blue Cross to the Rhode Island Credit Union League to the Riverview Nursing Home, Beretta wrote: "The rules of professional conduct require attorneys to keep confidential the identities of their clients."

Adler Pollock & Sheehan is also Secretary of State Brown's legal adviser.

Asked whether Brown had any concerns about seeking advice on how to administer the law from a firm that is advising other clients what they should and shouldn't report, Kerwin said: "There has been no conflict. If there ever was one, we would find other counsel."