COLORADO has the highest percentage of female state lawmakers in the nation, at 42 percent, according to data from the National Conference of State Legislatures. LOUISIANA has the lowest percentage, at 11.8 percent (HONOLULU CIVIL BEAT).
CALIFORNIA Secretary of State Alex Padilla (D) announced last week that he would not appeal an Alameda Superior Court ruling in May 2014 guaranteeing the right to vote for tens of thousands of felons in county-run programs created to help reduce the state’s prison population. “If we are serious about slowing the revolving door at our jails and prisons, and serious about reducing recidivism, we need to engage - not shun - former offenders,” Padilla said (SACRAMENTO BEE).
- Compiled by KOREY CLARK
Feeling the pressure to deliver business insights? These days, you face huge challenges—keeping pace with 24/7/365 news and social media and sifting out valuable nuggets of insight to share across your organization. Check out this Webinar to learn how leveraging integrated tools to curate, analyze and visualize content can help you uncover decision-making gold.
Editor: Rich Ehisen
Associate Editor: Korey Clark
Editorial Advisor: Lou Cannon
Contributing Editor: Mary Peck, David Giusti
Correspondents: Cathy Santsche, Felicia Carrillo
Graphic Design: Vanessa Perez Design
After decades of unabashed and yet unrequited love, Chris Christie is finally moving on. Yes, as NJ.com reports, Christie has finally conceded that his longtime fanboy crush on Jersey rocker Bruce Springsteen is never going to be reciprocated, and so he has found a new Garden State musical icon to throw himself at – Jon Bon Jovi. Christie didn’t offer a reason for the stunning change of allegiance, though one can presume it has something to do with Bon Jovi actually giving him the time of day, or at least not going on national TV to sing songs poking fun at him the way The Boss did on The Tonight Show a while back. In case you forgot that one, here you go: https://www.youtube.com/watch?v=VKHV0LLvhXM.
The MICHIGAN Supreme Court rules that the Wolverine State’s so-called “right-to-work” law applies to both the public and private sectors. The court also upholds a 2011 law that requires state employees in a defined benefit pension plan to either contribute 4 percent of their pay toward retirement costs or move to a 401(k)-style plan where future retirement benefits are not defined. That ruling overturned a decision by the Michigan Court of Appeals (DETROIT FREE PRESS).
NEW HAMPSHIRE Gov. Maggie Hassan (D) signs SB 266, which makes a number of changes to the state’s securities laws aimed at making it easier for businesses to raise working capital (NEW HAMPSHIRE PUBLIC RADIO, LEXISNEXIS STATE NET).
NEW YORK Gov. Andrew Cuomo (D) signs AB 136, which codifies that it is illegal for operators of a public building to refuse to remove barriers that prevent the disabled from accessing it. Gov. Cuomo also signs SB 5630, which directs the state Office for People with Developmental Disabilities to look at laws applying to military family members, and make suggestions for any improvements that would help families of people with developmental disabilities (LOCKPORT UNION-SUN & JOURNAL).
ILLINOIS Gov. Bruce Rauner (R) signs HB 3429, a bill that allows Prairie State companies to take investments in exchange for equity through crowdfunding platforms. Under the law, non-accredited investors with a net worth less than $1 million who make less than $200,000 per year may invest $5,000 per company per year (CHICAGO TRIBUNE).
With lawmakers in both parties reluctant to endorse his proposed carbon cap-and-trade plan during the recently-ended legislative session, Washington Gov. Jay Inslee (D) last week ordered the state Department of Ecology to instead develop a statewide cap on carbon emissions. The cap is intended to ensure the Evergreen State reaches its goal of reducing those emissions to half of 1990 levels by 2050.
Washington adopted its emissions reduction target in 2008, but lawmakers never followed up with an actionable plan to reach that goal. Inslee’s proposed cap-and-trade plan failed to pass either the Republican-controlled Senate or the Democrat-controlled House during this year’s marathon 176-day session. That, Inslee said, left him with no choice but to act unilaterally.
“This is not the comprehensive approach we could have had with legislative action,” Inslee said in a statement. “But Senate Republicans and the oil industry have made it clear that they will not accede to any meaningful action on carbon pollution so I will use my authority under the state Clean Air Act to take these meaningful first steps.”
Inslee walked away, however, from another of his earlier priorities, a clean fuel standard that would have required cutting carbon emissions from vehicle tailpipes. He did so because it would have triggered a so-called “poison pill” inserted by Republicans into a $16 billion mass-transit funding package Inslee recently signed. Under that provision, enacting a clean fuel standard would have automatically diverted about $2 billion in state funding away from bike, pedestrian and mass transit projects. The governor briefly pondered going forward with the fuel standard anyway but backed off amidst pressure from transit advocates.
“In talking about the terrible choice the Senate imposed on the people of Washington – clean air or buses and safe sidewalks – I heard broad agreement that we need both clean transportation and clean air,” Inslee said in a statement. “I appreciate the commitment I heard from many to work with me to ensure our state meets its statutory carbon reduction limits.”
The new cap is expected to take a year or more to develop. (WASHINGTON GOVERNOR’S OFFICE, SEATTLE TIMES, BELLINGHAM HERALD)
The fight for more control over federal lands within state borders has been waxing and waning in the American West since at least the 1890s. The latest flare-up of the Sagebrush Rebellion is centered in Colorado, where Republican gubernatorial nominee Bob Beauprez rallied for the cause in his first debate with incumbent Gov. John Hickenlooper (D) last year.
“This is a fight we have to wage,” he said. “If you believe in state sovereignty, if you believe in the way this republic is supposed to work, we do need to stand up and push back on the federal government, and I’ll push back. This is supposed to be Colorado’s land, not the federal government’s.”
This year Colorado’s General Assembly considered three bills related to the issue. One of them passed: HB 1225, giving local communities more say in federal land management decision-making. But the odds appear to be stacked against the state ever gaining direct control over the third of its territory - roughly 34 million acres - managed by the federal government.
“In my reading, it’s never going to happen, and I don’t think it’s a good idea,” said Randal O’Toole, a senior fellow and public lands expert at the libertarian Cato Institute.
O’Toole said one of the forces driving the issue is the push for more concessions by those who graze livestock on the federal lands. But he pointed out that federal grazing fees are currently $1.69 a month per acre, while state grazing fees average $11.88 an acre.
The federal government also covers the cost of fighting wildfires on federal lands. If the state had responsibility for that expense, just one major wildfire in the state could wipe out the budget, said John Swartout, Hickenlooper’s top adviser on land and conservation issues.
There are also major constitutional hurdles to any transfer of control of the federal lands. An analysis of the issue last year by the University of Utah’s College of Law found: “The federal government has absolute control over federal public lands, including the constitutional authority to retain lands in federal ownership. Statutes authorizing Western states to join the Union required those same states to disclaim the right to additional lands, and that disclaimer cannot be spun into a federal duty to dispose.” (DENVER POST)
On the surface, a campaign aimed at keeping testosterone-fueled young males from getting drunk and driving sounds like a really good idea. But then there is the campaign that Tennessee recently ran. As the Nashville Tennessean reports, the federally-funded campaign consisted of filling bars with coasters and fliers with pitches that make reference to women looking “hotter” when guys are loaded, only to discover later that said girls are only “marginally good-looking.” Worse, they are probably “chatty,” “clingy” or “your boss’s daughter.” It got worse from there, but suffice to say that was enough unto itself to spark outrage from lawmakers of both genders, who found the campaign sexist and offensive. Chastened, the Governor’s Highway Safety Office apologized and called the campaign off.
After battling over rival transportation funding bills for a week, with U.S. House Republicans favoring a five-month extension they passed last month and Senate Republicans preferring a longer-term plan, the House passed a three-month extension last Wednesday that the Senate was expected to approve before the end of the week, when federal transportation funding authority expired.
The inter-chamber, intra-party feud over highway funding came to a head a couple of weeks ago when House Majority Leader Kevin McCarthy (R-California) said his chamber would not take up the six-year funding bill drafted by Senate Majority Leader Mitch McConnell (R-Kentucky).
“Sen. McConnell and I work very closely together on a whole host of issues, but there are times when the Senate has to do what the Senate has to do and the House has to do what it has to do,” said House Speaker John Boehner (R-Ohio). “If you’ll notice, that doesn’t happen very often. It’s just that it’s happening this week.”
But last week Republicans in both chambers appeared to be rallying around the idea of a long-term highway bill and the passage of a three-month extension to buy them time to hammer out the details of that plan.
“I want a long-term highway bill that is fully paid for,” Boehner said after a House GOP conference meeting. “We’ve been trying to do this for four years, it’s time to get it across the finish line and I’m going to do everything I can to get to a long-term highway bill by the end of October.”
Boehner will have to wait to take up that cause until after Labor Day when Congress returns from its summer recess. (HILL)
Twenty-nine states have laws setting minimum wage rates above the federal minimum of $7.25 per hour. Washington’s rate, at $9.47, is the highest. Fourteen states have minimum wages that are the same as the federal rate. Only Georgia and Wyoming have state minimum wage rates below the federal minimum, while five states have no minimum wage laws, but the federal rate applies in all seven of those states.
Source: U.S. Department of Labor, National Conference of State Legislatures,
Legend:
Highest minimum wage rates: Washington, Oregon, Connecticut, Vermont, California, Massachusetts, Rhode Island
Lowest minimum wage rates: Wyoming, Georgia
No minimum wage law: Louisiana, Mississippi, Alabama, Tennessee, South Carolina
NEW JERSEY Gov. Chris Christie (R) announces that the Garden State will furnish 1,000 State Police officers with body cameras. The governor also unveiled new guidelines that require county prosecutors’ offices to disclose the findings of a use-of-force investigation even if the case is not presented to a grand jury for an indictment (GOVERNING.COM).
Frustrated by a lack of success on the federal level, advocates for raising the minimum wage have in recent years instead focused their energies on states and specific cities around the nation. Those efforts have proven far more fruitful: while the federal minimum wage of $7.25 per hour has not changed since 2009, 14 states and the District of Columbia have raised their minimums either legislatively or via voter-approved ballot measures in the last two years alone. In all, 29 states and DC now have a minimum wage higher than the federal standard.
Several major cities have got into the act as well. Seattle, Los Angeles and San Francisco have also established $15 minimum wages, set to take effect incrementally over the next few years. New York City Mayor Bill de Blasio has proposed following suit in the Big Apple, while activists are working to put a minimum wage ballot measure before Washington D.C. voters in 2016. Last year, Chicago endorsed a $13 wage, to be phased in by 2019. Kansas City, Missouri officials followed suit in July, agreeing to raise the wage within city limits to $13 by 2020.
The momentum continued late last month, with major developments on each coast.
The first came as the New York Wage Board, at the behest of Gov. Andrew Cuomo (D), proposed significantly raising the Empire State minimum wage specifically for fast food workers employed by chains with 30 or more outlets. Cuomo had been pushing for a higher wage for those workers since May. On July 22 the Wage Board agreed, recommending the wage floor be raised to $15 per hour, a hike of over 70 percent from the current $8.75. The Board finalized the proposal on July 27, sending it to the state’s acting commissioner of labor Mario J. Musolino, who Cuomo appointed in February. The new wage does not need legislative approval.
In an address after the New York panel’s vote, an ecstatic Cuomo called it “a great, great day...one of the really great days of my administration.” He also predicted it would lead to similar action around the country, saying “This is going to help hundreds of thousands of New Yorkers. But this is going to do something else because when New York acts, the rest of the states follow.”
The developments in New York came on the same day that University of California President Janet Napolitano announced the 10-campus, 195,000-employee UC system would phase in a $15 minimum wage, making it the first university system in the nation to endorse such a minimum for its lowest paid workers. Under her plan, which applies to employees who work at least 20 hours per week, the wage will rise to $13 per hour this October with $1 annual raises over the next two years. All three figures are more than the Golden State’s current minimum of $9.00 and the $10 minimum set to go into effect in 2016, though the Senate earlier this year endorsed a bill (SB 3) that would raise the state standard to $11.00 next year and to $13.00 in 2017. That measure is currently awaiting a hearing in the Senate Appropriations Committee and is expected to be heard shortly after lawmakers return from their summer recess on August 17.
Napolitano, a former Arizona governor and Department of Homeland Security Director in the Obama administration, echoed Cuomo’s belief that the action could spur other entities to follow suit. In a statement, she called the hike “the right thing to do for our workers and their families, for our mission and values, and to enhance the UC’s leadership role by becoming the first public university in the United States to voluntarily establish a minimum wage of 15 dollars.”
While the UC has relatively few employees of its own that will directly benefit from the new wage, its impact will spread much further. As proposed, the wage requirement will also apply to contract workers, which one UC official estimates number far more than the 3,200 full- or part-time UC employees who will receive the higher pay. It could also conceivably place significant pressure on other institutions to follow suit.
Whether that pressure influences California Gov. Jerry Brown (D) to sign SB 3 if it gets to his desk is unclear. At least one of the bill’s primary supporters has her doubts.
“I hope the governor sees that poverty is a real problem in California, the way it is in Kansas City, Chicago and New York,” says Laphonza Butler, president of the California State Employees International Union State Council. “But this governor is not going to be influenced by anything but his own thoughts and beliefs.”
According to LexisNexis State Net, statewide measures to raise the minimum wage tailed off significantly this year, with only one state – Rhode Island – passing such a bill so far. Under that measure (SB 194), the Ocean State minimum wage – which rose to $9.00 per hour in January – will climb to $9.60 on January 1, 2016.
The potential fiscal impact of the higher wage floors is also a hotly contested issue. Supporters argue that paying minimum wage workers more will help lift them out of poverty and ease their dependence on government-funded aid programs like Medicaid and food stamps, which many see as a publicly-funded subsidy to large corporations who reap huge profits while paying their workers poverty wages. Opponents counter that pushing the wage this high will cost many low wage workers their jobs as employers are forced to reduce costs or face closing down. And while some research has shown that modest increases in the wage have not caused significant job loss in those areas, the newest hikes are uncharted territory.
“There could be quite large shares of workers affected, and research doesn’t have a lot to say about that,” Jared Bernstein, a former White House economist now at the Center on Budget and Policy Priorities, told The New York Times.
The Times also notes that the fast food wage hike could be particularly hard on employers outside of New York City, where a $15 wage would represent as much as 75 percent of the average workers’ wage in cities like Buffalo. Cities like New York, Chicago and Los Angeles are also renowned tourist destinations, which typically come with expectations of higher prices travelers do not count on in smaller locales.
Pay hikes in particular industries also don’t help workers not working in those areas, though it could spur other employers to raise their wages in order to keep employees from fleeing to those sectors, or to cities with higher pay.
Whatever the short-term outcome, the battle over wage standards is not going away any time soon. Democratic presidential candidate Bernie Sanders (D-Vermont) has introduced federal legislation to raise the federal minimum to $15, a bill that has drawn strong support from fellow candidate and former Maryland Gov. Martin O’Malley. The Democratic frontrunner, Hillary Clinton, has expressed her support for raising the wage to $15 in certain urban areas but not as a nationwide mandate.
Follow Rich on Twitter at @WordsmithRich
The Florida League of Cities, which represents more than 400 municipal governments in that state, has filed a legal brief with the Florida Supreme Court urging it to reject a citizens’ initiative bound for the state’s November 2016 ballot. The proposed Solar Choice amendment would allow the sale of up to 2 megawatts of solar power by homeowners and businesses in the state, one of only four without a distributed power option for consumers.
But Florida’s cities are not all united in their opposition to the measure. Last week officials from 13 cities, including St. Petersburg and South Miami, accused the League of doing the bidding of the state’s for-profit utility companies, which pay franchise fees to be the exclusive providers of electric power in the state, and demanding that the League withdraw its brief.
“There’s a number of city leaders who are pretty disgusted with the league,” said South Miami Mayor Philip Stoddard. “It feels like a really parochial organization that’s been coopted by Florida Power & Light.”
The city leaders also accused the League of violating protocol because it failed to get a formal vote of its membership before issuing its brief.
But John Thomas, the League’s director of public affairs said there was nothing unusual about the organization’s action.
“The League has been filing briefs this way for 30 years now,” he said. “We try to make decisions that are in the best interest of our member cities.”
He also said the organization’s “resolution committee” would take a formal vote on the proposed amendment this month.
“Our members will have the opportunity to speak on this at our conference,” he said. “It is too early to determine what the position of the League of Cities will be.” (TAMPA BAY TIMES)
When he was running for office, Virginia Gov. Terry McAuliffe promised his kids that if he won they could get some chickens. And as any parent knows, kids never forget a promise. So as the Washington Post reports, there is now a quartet of hens at the governor’s mansion, making McAuliffe the first modern Old Dominion governor to keep live farm animals there. And to the best of anyone’s knowledge, McAuliffe is also the only current governor in the nation with such critters, though that is a fairly recent development. As recently as 2014 former Illinois Gov. Pat Quinn had nine chickens at the Prairie State governor’s mansion, but current Gov. Bruce Rauner apparently wasn’t in a fowl mood and had them removed. But while one could easily see “Raging Rauner” eating them with his bare hands, we are assured they are all alive and “in a loving home.”
The U.S. Supreme Court’s June ruling legalizing same-sex marriage nationwide was a big win for same-sex couples longing for marriage equality. But it may be a big win for the national economy and state and local governments too.
The rush of gay and lesbian couples to the altar – and the additional spending on wedding services and travel, food and lodging for out-of-town guests - over the next three years could inject $2.6 billion into the nation’s economy, support over 13,000 jobs, and generate $184.7 million in state and local tax revenue, according to a report issued in December 2014 by the Williams Institute at the UCLA School of Law, in partnership with Credit Suisse.
The Institute’s projections varied considerably from state to state, depending largely on states’ same-sex populations. For instance, the Institute estimated that in California, which legalized gay marriage in 2008, 51,319 same-sex marriages would take place in the first three years after legalization, generating $392.3 million in total spending, $31.4 million in tax revenue and 2,178 jobs, while in North Dakota, where same-sex marriages weren’t yet legal when the Institute released its report, the figures are 280 marriages, $1.9 million in spending, $0.1 million in tax revenue and 8 jobs. (STATELINE.ORG, WILLIAMS INSTITUTE)
MICHIGAN Gov. Rick Snyder signs SB 69, which extends until 2023 a program that allows community colleges to partner with employers to establish and fund jobs training programs in the Wolverine State (MICHIGAN GOVERNOR’S OFFICE).
Like it or not, money-obsessed bloviator Donald Trump has dominated the news cycle of late with a string of racist and otherwise idiotic commentary meant as much to get media attention as to attract voters. Mission accomplished on that front, much to the chagrin of other GOP presidential candidates who find themselves trailing him in the polls and struggling to get any news play other than responding to “The Donald’s” latest nonsensical rant. As such, The New Yorker’s very liberal-leaning satirist Andy Borowitz recently had a little fun, imagining Wisconsin Governor and fellow GOP aspirant Scott Walker trying to capture Republican voters by assuring them “that he is as horrible as Donald Trump.” We’ll leave it at that.
- By RICH EHISEN
Taxes generally don’t have many fans. But a sales levy in Utah seems to be catching on. Known by a host of acronyms, including RAP (Recreational, Arts and Parks), ZAP (Zoo, Arts and Parks), and PARAT (Parks, Art, Recreation, Aquatics and Trails), the city or county tax collects a penny on every $10 spent to fund the specified cultural and recreational programs.
Last year voters in Salt Lake County overwhelmingly approved a 10-year extension of the ZAP tax that generated over $20 million for cultural, recreational and zoological organizations there in 2014.
“It’s been fabulous,” said Victoria Bourns, director of the county’s ZAP program. “It’s very gratifying to live in a community where people appreciate arts and culture and are willing to put their own money toward it.”
Since Salt Lake County initially adopted the resolution instituting its ZAP tax in 1996, five other counties have followed its lead. Some counties in the state, however, have opted to let cities decide whether to adopt such taxes. That’s the approach David County has taken, and seven of its 15 cities have adopted the taxes. West Bountiful did so in 2008 and its mayor said the tax has provided funding for several parks and recreation projects, including improvements at City Park.
“It’s allowed us to provide amenities at the park and upgrade the park that there’s no way we could do otherwise in our city,” he said. “The budget just hadn’t been there for parks and recreation [before the tax].” (SALT LAKE TRIBUNE)
The MASSACHUSETTS Senate approves SB 1973, which would require the Bay State to develop a comprehensive climate change adaptation plan. It moves to the House (SUN CHRONICLE [ATTEBORO]). * The U.S. Environmental Protection Agency announces it will give states an additional two years – until 2022 - to comply with proposed regulations that will require dramatic cuts in greenhouse-gas pollution from power plants. The EPA will also offer credits and other inducements to encourage more use of renewable energy under the Clean Power Plan, the Obama administration’s proposal to cut pollutants blamed for climate change (WASHINGTON POST).
The governing board of Cook County, ILLINOIS narrowly approved a one-cent sales tax increase that will push Chicago’s rate over that of four Alabama cities and Seattle on Jan. 1, making it the highest rate of any major U.S. city, at 10.25 percent (CHICAGO TRIBUNE).
MASSACHUSETTS lawmakers overrode a series of budget vetoes by Gov. Charlie Baker (R) to restore millions of dollars in funding for kindergarten expansion and the University of Massachusetts, among other things. Lawmakers also approved a two-day tax holiday in mid-August (STATE HOUSE NEWS SERVICE [BOSTON], LEXISNEXIS STATE NET).
Six states -- ILLINOIS, NEW HAMPSHIRE, MASSACHUSETTS, NORTH CAROLINA, PENNSYLVANIA and WISCONSIN -- started their 2016 fiscal year on July 1 without a budget in place, according to the National Conference of State Legislatures. But only ILLINOIS and PENNSYLVANIA still haven’t passed a budget or temporary spending plan (ANNISTON STAR).
Three public employee pension funds in NEW JERSEY are seeking billions of dollars in damages from the state in a lawsuit alleging it breached contracts when it contributed less than the amount specified by the pension funding plan Gov. Chris Christie (R) signed into law in 2011. A budget shortfall forced Christie to veer from that plan last year (ASSOCIATED PRESS, PHILADELPHIA INQUIRER).
WISCONSIN lawmakers approved a bill (SB 209) allocating $250 million in public money for the construction of a new arena for the NBA’s Milwaukee Bucks. Gov. Scott Walker (R) proposed the idea seven months ago (MILWAUKEE JOURNAL SENTINEL, LEXISNEXIS STATE NET).
OREGON Gov. Kate Brown (D) signs SB 460, which allows Beaver State medical marijuana dispensaries to begin also selling recreational weed on October 1, three months earlier than expected. Under the law, adults 21 and older may purchase up to a quarter ounce of marijuana per day at existing registered medical marijuana dispensaries even if they do not hold an Oregon medical marijuana card. Adults will also be allowed to purchase cannabis seeds and up to four immature plants, but will not be allowed to purchase extracts, cannabis-infused edibles, or other products available to medical marijuana patients (DAILY CHRONIC).
ILLINOIS Gov. Bruce Rauner (R) signs SB 689, which allows physicians assistants, advance practice nurses, practical nurses or registered nurses who provide hospice or home health care services to be in possession of and deliver a prescribed medication, including a scheduled narcotic, to a patient in their care (POSITIVELYNAPERVILLE.COM).
ILLINOIS Gov. Bruce Rauner (R) signs SB 1847, a bill that raises the income limit for the federal Supplemental Nutrition Assistance Program (SNAP) to 165 percent of the poverty level. The previous cap was 130 percent. The law takes effect on January 1 (PEORIA JOURNAL STAR).
The OKLAHOMA Supreme Court rejects an appeal by state officials to reconsider its June 30 ruling that calls for the removal of a monument to the Ten Commandments from Capitol grounds. The court said the presence of the monument violates a section of the Sooner State Constitution prohibiting state property from being used to further religions (OKLAHOMAN [OKLAHOMA CITY]).
- Compiled by RICH EHISEN
When the final match of the FIFA Women’s World Cup Canada™ concluded earlier this month, the fans of the U.S. women’s soccer team celebrated, and for a moment, FIFA was in the spotlight for good reason. The Women’s World Cup generated a lot of interest—so much, in fact, that the final match between the USA and Japan was the most-watched soccer match ever in the United States with a combined total of 26.7 million viewers on Fox and Telemundo. Yes, that’s a bigger audience than the USA-Portugal men’s match last year. Unfortunately, with the game—and the viewership—now marked down in the record books, eyes are once again turning to the FIFA corruption allegations.
FIFA sponsors have certainly put pressure on the organization to make changes in recent months. Fortune noted that Blatter’s resignation took place after “…almost all of its eight official partners (Visa, Adidas, Coca-Cola, Gazprom, Hyundai, Kia, Budweiser and McDonald’s) put out press statements shunning the organization and calling for change.” And sponsors are right to be concerned because the scandal that’s rocking FIFA could very well come knocking at their doors next.
Why? Because, as the Houston Chronicle reported a few weeks ago, the corruption allegations could end up negatively impacting the reputations of corporate sponsors—or even uncover vulnerabilities to FCPA actions. A Houston attorney who specializes in the Foreign Corrupt Practices Act and has experience with third-party risk within the energy sector anticipates that any company that sponsored FIFA tournaments or teams outside the U.S. could be receiving an official subpoena as the investigations continue. In an interview, attorney Thomas Fox said, “Anybody that is doing any kind of international sports marketing now really needs to take a look at this, and that means the International Olympic Committee, international track and field, all of those.” A thorough and on-going due-diligence and monitoring process is particularly important when a company is working through third-party agents in those countries. According to the article, the FIFA indictment from May accused an unnamed sportswear company of paying bribes through a third-party Brazilian agent in 1996—and claiming that such an agent acted without the company’s knowledge won’t fly with FBI and SEC authorities. As Fox pointed out in his interview, “The government is going to say either you knew about it or you should have known about it.”
Bribery allegations are not the only concern. In Qatar, where construction is on-going in preparation for World Cup 2022, more than 1,400 migrant workers have died at Qatar building sites since 2010. While not all of those sites where World Cup locations, the issue is being reported as a human rights crisis—and the silence among many FIFA sponsors is raising eyebrows. Visa has spoken out, releasing a statement that said, “We continue to be troubled by the reports coming out of Qatar related to the World Cup and migrant worker conditions. We have expressed our grave concern to FIFA and urge them to take all necessary actions.” If the crisis isn’t handled quickly, corporate sponsors might find their reputations under attack—all because of their on-going relationship with FIFA. Considering everything that FIFA sponsors have on the line, it’s clear that enhanced due diligence may be the best strategy for mitigating third-party risk now and well into the future.
Faced with increasing globalization and supply chain complexity, pharmaceutical companies have the daunting task of managing risks—ranging from counterfeiting to piracy—that could potentially threaten patient safety. What’s more, the pharmaceutical industry is not immune to the impact of stricter laws and sanctions to counter bribery and corruption.
On a recent webinar, LexisNexis Segment Leader for Entity Due Diligence and Monitoring Mark Dunn discussed how anti-money laundering, anti-bribery and corruption enforcement trends effecting the pharmaceutical industry. He also reviewed regulator expectations for staying compliant within a global business environment and shared best practices around risk assessment and why a healthy due- diligence strategy is the best approach to reducing regularity risk.