Former Gov. Sebelius at her confirmation hearing to become HHS Secretary
Surprisingly, former Gov. Kathleen Sebelius filed a conflict of interest statement today with the Kansas Governmental Ethics Commission, even though she resigned her job as Governor and became the Secretary of Health and Human Services on Tuesday.
Today is the 2009 deadline for many Kansas officials to file yearly conflict of interest statements, but it’s unclear whether Sebelius was required to file this statement since she no longer is Governor.
Sebelius’ 2009 Kansas Statement of Substantial Interests had nearly the same information as her 2008 statement. The biggest difference was her address: In 2008 she lived at the Governor’s Cedar Crest mansion, but today’s filing from HHS Secretary Sebelius showed her Washington, DC address on Independence Avenue.
In a related matter today, Propublica published Sebelius’ Ethics Agreement sent as a letter to HHS General Counsel/Ethics Official Edgar M. Swindell on March 17, 2009:
The purpose of this letter is to describe the steps I will take to avoid any actual or apparent conflict of interest in the event that I am confirmed for the position of Secretary, U.S. Department of Health and Human Services.
The letter says that upon confirmation Sebelius would resign from being:
- Governor of Kansas
- Member of National Assessment Governing Board
- Member of Center for Innovative Thought, College Board
- Member of American Federation of Teachers Educational Foundation Innovation Fund Advisory Board
Oddly, the last three board memberships listed in the HHS Ethics Agreement above were never mentioned on her 2008 or 2009 Kansas Statement of Substantial Interests even though the KS SSI requires Sebelius to
List any organization or business in which you or your spouse hold a position of officer, director, associate, partner or proprietor at the time of filing, irrespective of the amount of compensation received for holding such position
Sebelius’ 2009 SSI mentions she was an executive committee member of the Democratic Governors Association and the National Governors Association — perhaps Sebelius has or will resign from those positions, too.
Sebelius’ 2009 SSI, dated April 30, 2009, said she was still the Chair of the Education Commission of the State, but her HHS Ethics Agreement, dated March 17, 2009, said she had resigned that position in June 2008.
News stories on April 2 revealed the Sebelius and her husband had to divest certain stocks, which are itemized in the HHS Ethics Agreement:
- Fidelity Advisor Energy Fund
- Kronos Worldwide, Inc.
- NL Industries, Inc.
- Westar Energy, Inc.
Sebelius’ 2009 SSI listed “Fidelity Advisor Funds” but did not mention Fidelity Advisor Energy Fund specifically. It’s unclear why Sebelius’ SSI did not mention holdings in the last three above, unless her equitable interest was $5000 or less. Regardless, Sebelius’ ownership of Westar Energy, a utility company generating most of its electricity from coal, was a huge conflict of interest for her as she vetoed new coal power plants in Western Kansas the last two years.
Sebelius’ HHS Ethics Agreement revealed her 25% interest in the Swallows Partnership, a family partnership holding a summer home in Leland, Michigan. This explains her occasional trips using the State of Kansas Executive Aircraft to Traverse City, Michigan, which is about 30 miles from Leland. An Oct 28, 2006 Topeka Capital-Journal article said Sebelius billed the state $5,686 for one such trip to her summer family home.
Sebelius’ March 17 HHS Ethics Agreement letter now explains the timing of removing herself from being the Chair of her Bluestem Fund PAC: On March 4 Jeremy Anderson, who left the staff of Gov. Sebelius in Jan 2009 to work with Parris Communications, became the chair of her Bluestem Fund PAC, which Sebelius had chaired since April 2000. Oddly, about a week later on March 12, former Sebelius Chief of Staff and Campaign Manager Joyce Allegrucci became the chair of the Bluestem Fund PAC. At the same time Allegrucci change the purpose of the PAC from a “Leadership PAC” to “Kansans to support Democrats for elected office.”
[Both Anderson and Allegrucci had been paid by the Democratic Governors Association when Sebelius headed that organization after her re-election in 2006. Anderson received $10,000 for "consulting services" on 2/28/2007 (see DGA IRS 8872, 6/30/2007 , p. 31) and Allegrucci received $25,000 for being a "consultant" also on 2/28/2007 (see DGA IRS 8872, 6/30/2007 , p. 29).
Joyce Allegrucci's son, Scott Allegrucci, a former actor and screenwriter, had been appointed by Sebelius to be the Kansas tourism director in 2003. At that time Joyce Allegrucci was one of Sebelius' top advisors, and her husband, Don Allegrucci, was a Kansas Supreme Court justice. Scott Allegrucci became Kansas tourism director with no experience and the Kansas press gave him a pass and saw no nepotism.
As tourism director Scott spent $1.7 million of tax dollars to come up with the new state tourism slogan, "Kansas: As big as you think." Scott Allegrucci today is the director of the Great Plains Alliance for Clean Energy, a group responsible for opposing the coal power plants in Kansas that Gov. Sebelius has been trying to kill through her vetoes.]
Sebelius’ HHS Ethics Agreement was silent about what she will do with her Kathleen Sebelius for Governor Committee. In her Jan 12, 2009 contribution report that committee has a balance of $25,741. The Kansas press has never questioned why in 2008 when Sebelius was not running for office (and was term-limited from running for re-election) this gubernatorial committee raised $92,971 and spent $157,861. These huge expenses during an election year, which likely indirectly helped the Kansas Democratic Party and her fellow Kansas Democrats, demonstrate why reporting more than once a year is needed by such statewide committees in an “off election year.”
While Gov. Sebelius is now in Washington, DC, more political money stories will likely be found as more information is discovered.
Related:
- Obama Administration Ethics Agreements, ProPublica, April 30, 2009 (updated).
- Sebelius’ HHS Secretary nomination vote: 65 yes, 31 no, Kansas Meadowlark, April 28, 2009.
- Gov. Sebelius invested in coal power, but blocked new coal plant? Conflict for HHS but not Kansas?, Kansas Meadowlark, April 3, 2009.
Tags: Bluestem Fund PAC, Ethics Agreement, Governor, HHS Secretary, Kathleen Sebelius, ProPublica
