Hopefuls call for ban on loans between legislators

Both candidates for Arkansas attorney general on Monday called for a prohibition on lending between state lawmakers, in response to a report in this newspaper about the existence of such loans.

The Arkansas Democrat-Gazette reported Sunday that House Revenue and Taxation Committee Chairman Joe Jett, R-Success, said he made a $16,000 loan to then-House Speaker Jeremy Gillam, R-Judsonia, in the fall of 2016. The newspaper learned Monday of an additional instance in which a state House member made a loan to his colleague.

While the loans are allowable under current laws and legislative rules, leaders in the House and Senate said they would initiate reviews of the practice.

CANDIDATE PROPOSALS

Democratic candidate Mike Lee, who previously in the campaign released a slate of ethics reform proposals, said Monday morning he would add a ban on loans between lawmakers to his list.

Attorney General Leslie Rutledge, the Republican incumbent who is seeking her second four-year term, followed up several hours later with her own statement.

“To avoid even the appearance of impropriety, loans among members of the General Assembly should be prohibited,” Rutledge said. “As Attorney General, I will work with the House and Senate leadership to draft legislation to ensure that this ill-advised practice is illegal.”

A campaign spokesman later clarified that Rutledge did not intend to put forward her own legislation, but to advise lawmakers during the drafting process. During her first term, Rutledge opted not to put forward a legislative package, contrary to what previous attorneys general have done. Lee has criticized Rutledge for not

offering legislative proposals.

“Loans among lawmakers can be used to influence political appointments and legislation. Safeguards against corruption need to be put in place this election,” Lee said in his Monday morning statement. “This is the latest case in which Leslie Rutledge has chosen to remain silent.” Later Monday, Rutledge released her statement.

The current House speaker, Rep. Matthew Shepherd, R-El Dorado, said he has asked staff to develop legislation or rules for a possible ban.

Sen. Jim Hendren, R-Sulphur Springs, who is scheduled to become the Senate president pro tempore in January, also said he would look at possible changes.

ANOTHER LOAN

In his annual personal finance disclosure report for 2016, then-state Rep. Nate Bell, an independent from Mena, listed state Rep. Charlie Collins, R-Fayetteville, as a creditor “to whom the value of five thousand dollars ($5,000) or more was personally owed or personally obligated and is still outstanding.”

Both Bell and Collins on Monday declined to say how much Bell borrowed from Collins. Bell said he complied with state law and declined further comment. Collins said the loan hadn’t been paid off yet.

On his personal financial disclosure report for 2016, Collins reported a loan of more than $12,500 to Nate and Phyllis Bell and receiving more than $1,000 in interest on a loan to the couple. On his report for 2017, Collins reported a loan of more than $1,000 but less than $12,500 to Nate and Phyllis Bell and receiving interest income of more than $1,000 on a loan to the couple. Phyllis Bell is an aide to Gov. Asa Hutchinson.

Gillam resigned from the House of Representatives in June to become the University of Central Arkansas’ director of governmental affairs and external relations.

After being contacted by a reporter for the story published Sunday, Gillam on Friday updated his Statement of Financial Interest for 2016 and 2017 to add the loan, which was not disclosed on the forms until then. He said he hopes to repay the loan by the end of this year. Gillam described the loan as a farm-to-farm transaction that had nothing to do with his reappointment of Jett as the House tax committee chairman in 2017.

Hendren also revealed to the paper that he had advanced roughly $4,000 to then-Sen. Jake Files, R-Fort Smith, in the 2015 session to help Files cover some checks. Hendren said he had recently written off the loan as a gift. Files pleaded guilty in January to federal wire fraud, bank fraud and money laundering charges and was sentenced to 18 months in prison.

Arkansas Ethics Commission Director Graham Sloan told the paper that loans in excess of $5,000 should be reported under current rules.