Before sunrise on January 3, state Rep. Jared Bauman had a question for the Kentucky Legislative Ethics Commission.
Bauman wanted to sponsor and vote on legislation that could benefit his employer. Was it permissible for him to do that? Bauman asked Laura Hendrix, the commission’s executive director.
Bauman is employed by the Lubrizol Corp., a specialty chemical company located in the Rubbertown industrial complex in west Louisville.
The intent of the bill he wanted to introduce was to allow Louisville companies — like Lubrizol — to avoid civil penalties if they voluntarily reported pollution or other infractions, and made the necessary corrections, an approach similar to state law that already applies to other counties in the state.
Hendrix responded to Bauman’s request less than an hour later, telling him that because his proposed bill would affect “other, similarly situated businesses in the same way” it applied to Lubrizol, there was no conflict of interest.
So that same day, Bauman introduced House Bill 136.
Four authorities on legislative ethics told the Kentucky Center for Investigative Reporting that while Bauman’s involvement in the bill may not violate state law, it nevertheless highlights questions that arise when the perception of a conflict exists:
What are the motives behind the legislation? Who benefits? Are lawmakers meeting a standard of transparency that promotes trust in government?
In Bauman’s case, the legislative ethics authorities identified several concerns. And the mere appearance of possible impropriety is chief among them.
“The public perception can be that all legislators are in Frankfort doing favors for their business associates, friends and campaign contributors,” said John Schaaf, the former executive director of the Legislative Ethics Commission who retired in 2019.
Schaaf agreed with the ethics commission’s opinion that Bauman likely isn’t violating law by sponsoring the bill. However, he also expressed concern that legislators sponsoring bills benefiting their private employers can undermine public trust in all legislators and in the institution of the General Assembly.
What Bauman is doing isn’t unusual. Across the country, state lawmakers introduce and support policies that directly and indirectly aid their own businesses, employers and personal finances, according to a 2017 report from The Center for Public Integrity, a nonprofit news outlet based in Washington, D.C.
The report found that lawmakers often blur the lines between public business and personal finances.
A year later, reporters at ProPublica, a nonprofit, New York City-based news organization, found that few states have rules prohibiting lawmakers from advancing bills that benefit their own financial interests.
Bauman, a Republican who represents the 28th legislative district in southwest Jefferson County, did not respond to a half-dozen requests from KyCIR to discuss HB 136 and the ethical issues pertaining to his involvement in it.
A financial disclosure form Bauman filed with the ethics commission in January 2023 lists him as the “operational excellence manager” for Lubrizol.
Olivia Tormento, an Ohio-based corporate spokesperson for Lubrizol, said that decisions Bauman “makes to sponsor or support proposed legislation are his alone. Jared does not seek Lubrizol’s input or discuss proposed legislation with anyone at Lubrizol.”
Tormento did not respond to questions from KyCIR including whether the company requested or directed Bauman to file HB 136, or whether Lubrizol compensated Bauman, financially or otherwise, for his support of the legislation.
It’s generally a bad idea for legislators to push bills that could benefit their employer, said Richard W. Painter, a professor at the University of Minnesota law school and the chief ethics lawyer for President George W. Bush from 2005 to 2007.
Doing so can make lawmakers susceptible to accusations of supporting bills in exchange for rewards or incentives at work, Painter said.
“It could be a big mess,” he said. “And if you don't want to be in that mess, whoever's in charge in the legislature ought to say, ‘if the bill is a direct benefit to their employer, get someone else to sponsor the bill.’”
During a legislative committee hearing on January 18, Bauman evaded questions about his job with the Lubrizol.
When a fellow legislator asked Bauman during the hearing if he would benefit from the legislation or worked for a company that would, he replied, “I guess I don't really know how to answer that.”
He was then asked the name of his employer, and responded: “I don't think that's relevant.”
Bauman should have immediately disclosed to his fellow legislators that he works for a company that could benefit from his bill, said Norman Ornstein, senior fellow emeritus at the American Enterprise Institute, a nonpartisan, nonprofit research organization in Washington D.C.
“The fact that when he testified, he didn't want to say who his employer was, is a little fishy,” Ornstein told KyCIR. “Are you being ethical if you dance around who your employer is, when you're testifying in support of your own bill?”
Ornstein said lawmakers need to be honest about their involvement with businesses or individuals that could benefit from legislation, so everyone — inside and outside the legislature — can evaluate the lawmakers’ role and motive.
“Why would you not say up front the facts involving your own interest in this legislation? Because there is indirectly a self interest,” Ornstein said. “This is in a shady place, and doesn't meet the standards I would hope you would see in a legislature.”
Ornstein, who helped create the U.S. House Office of Congressional Ethics in 2008, said the argument that there is no conflict of interest with Bauman pushing the bill because it could affect other companies in addition to his own is “a rather shaky rationale.”
“Introducing a piece of legislation that would directly benefit his employer, no matter who else it would benefit, is not something that fits within my bounds of ethics,” he said.
Lubrizol Advanced Materials is located on Bells Lane in Rubbertown, a section of the city that’s long been subjected to heightened levels of pollution. A recent health equity report published by Louisville Metro Government shows that residents in areas surrounding Rubbertown have higher rates of cancer and lower life expectancies than other areas of the city.
Emissions from Lubrizol and other companies are regulated by the Louisville Metro Air Pollution Control District (APCD), which implements federal, state, and local air pollution laws and regulations.
Louisville Metro APCD records show that Lubrizol’s Rubbertown operation has reported at least a half-dozen incidents, including chemical leaks, since 2020. But APCD spokesperson Matt Mudd told KyCIR that “immediate corrective action was taken” by the company each time and that “leaks, if there were any, were in small amounts that did not cause a violation of any numerical standard.” As a result, Mudd said, no enforcement action was taken.
Bauman’s HB 136 was approved by the state House of Representatives on January 23 by an 80-12 vote, with an amendment stating that a reported incident “not be part of a pattern of violations occurring in the past five years at a facility or facilities owned by the same entity.” The amendment did not elaborate on what would constitute a pattern of violations.
The bill is currently pending before the State and Local Government committee in the Kentucky Senate.
Danielle Caputo, a lawyer who works on the ethics team at the Campaign Legal Center in Washington, D.C., said Bauman's bill raises a question about his focus as a lawmaker — is he doing this for the people in his district, or for the companies regulated by the Louisville Metro APCD, including Lubrizol?
“It definitely begs the question as to why he's sponsoring this legislation,” she said. “If it's really for the benefit of Kentucky generally, or to benefit people that he knows on a private level.”
