Members Earn Outside Income

Posted June 16, 2004 at 6:49pm

Apparently, public servant doesn’t mean pauper.

While speaking fees and expensive gifts are now off-limits, dozens of House lawmakers have found both conventional and more creative ways to supplement their $154,000 Congressional salaries, according to the latest crop of House financial-disclosure statements, which were released publicly this week.

For instance, retiring Rep. Bill Lipinski (D-Ill.) disclosed an extra $105,410 he received between 1989 and 2003 from Mitchell & Ness Sporting Good Co., partly for “services” and partly for the company’s use of his collection of sports memorabilia.

While hundreds of lawmakers collectively gambled millions of dollars in the stock market last year, House Administration Committee Chairman Bob Ney (R-Ohio) had Lady Luck on his side when he won $34,000 in a “game of chance” at a London casino last year.

Ney spokesman Brian Walsh said that after the Congressman bet $100 on his first hand in the high stakes card game and miraculously won, he thought “What the heck” and took a gamble on the next hand with his entire winnings.

Ney’s winnings at the Ambassador’s Club casino allowed him to dramatically pay down some of his credit card debt, Roll Call has confirmed. That debt, which once totaled between $30,000 and $100,000, has been whittled down to less than $10,000.

Moreover, scores of lawmakers are collecting modest pensions from their pre-Congressional careers, while others are continuing to draw compensation from companies they still own or once ran, a review of the thousands of pages of filed documents showed.

For example, 57-year-old Rep. Jerrold Nadler (D-N.Y.), a former member of the New York Assembly from 1976 to 1992, is collecting a pension from the state of New York that totaled $19,258 in 2003.

His New York colleague, 60-year-old Rep. Peter King (R), who served as Nassau County comptroller from 1981 to 1993, is drawing a $38,422 pension from the state.

Among Texas lawmakers, Rep. Ralph Hall (R) is earning a $53,493 legislative pension from the Lone Star State, while Democratic Rep. Eddie Bernice Johnson — who turns 69 in December — is collecting a $25,000 annual legislative pension from the state. Johnson also received $15,000 in Social Security last year.

To avoid the potential for conflicts of interest, House ethics rules strictly prohibit how much income lawmakers may draw from outside employment. In addition, all Members are explicitly barred from accepting honoraria for appearances, speeches and articles, and they may not accept compensation for serving as a board member or officer of any organization.

Lawmakers are also prevented from receiving more than 15 percent of their House Members’ salary in total outside-earned income, which is defined as “wages, salaries, fees and other amounts received … as compensation for personal services actually rendered.”

But there are several exceptions to this rule. Excluded from the definition is compensation for services rendered prior to coming to Congress; compensation paid in the form of a pension, profit-sharing or stock plan; or amounts received in connection with protecting one’s investment in a family-controlled business or farm, as long as those amounts don’t generate a “significant” amount of money.

Under those guidelines, Rep. Rubén Hinojosa (D-Texas), a former executive with a food-processing company, was allowed to receive $20,000 last year in “consulting fees” from H&H Meat Products Co., Inc., a family business formed in 1947 that retails its products to such big-name chains as Burger King.

Teaching contracts require prior written approval from the Committee on Standards of Official Conduct, and lawmakers may receive copyright royalties when they publish work under “usual and customary contractual terms.”

Rep. Richard Neal (D-Mass.), who spent many years teaching before plunging into politics, is one Member who has returned to the classroom. He drew an extra $19,990 last year — officially approved by the House ethics panel — from the University of Massachusetts at Amherst, where he has taught a politics, government and journalism class for the past five years.

Other lawmakers continued to reap the benefits of their pre-Congressional livelihoods.

Rep. Johnny Isakson (R-Ga.), a wealthy real estate executive who won a special election to replace former House Speaker Newt Gingrich (R-Ga.) in 1999, received $80,000 in “deferred compensation” last year from Fairgreen Capital LP.

Until 1999, Isakson served as chairman of the limited partnership — an umbrella organization that oversees a brokerage firm, a mortgage company, a builder-developer, and other entities.

Last year, Rep. Jeb Hensarling (R-Texas) received $20,071 in income from San Jacinto Ventures LLC, a communications company he founded in 1996. That money was actually earned in 2002, before he began serving in Congress.

Similarly, Rep. Jim Cooper (D-Tenn.) made $1,000 in director’s fees from the Assistive Technology Group in Naperville, Ill., that he reported as “earned in 2002 and mistakenly not paid until 2003.” Cooper received another $8,294 from the Cornell Companies Inc. of Houston, Texas — funds earned two years ago but not paid until last year.

At least one lawmaker cut longstanding business ties last year.

California Rep. George Radanovich (R-Calif.), a small vintner, sold his Mariposa, Calif., winery last year, according to his financial disclosure forms.

Radanovich spokeswoman Heather Davis confirmed the sale.

“For over 20 years, he’s been in the winery business and is still very supportive of wine and agriculture and San Joaquin Valley, but the winery has been sold,” Davis said. She added, however, that “the Radanovich wine label will go on through the new ownership.”