Let’s Return to the Real Issue: Transparency and Conflicts of Interest

A mini-firestorm has developed surrounding the issue of whether Connecticut’s Commissioner of Education, Stefan Pryor, should recuse himself from any Department of Education decisions about Achievement First, the charter school management company, that he helped form and where he has served as a member of its board of directors from its inception in 2003 to 2011 when he resigned immediately prior to being named Education Commissioner.

This is not a question about whether Commissioner Pryor has a legal “conflict of interest”.  It is a question of whether the “appearance of a conflict of interest” is sufficient enough that he should recuse himself because that is the ethical and transparent thing to do.

In response to the concerns I’ve raised over the past few days, some reporters have asked Governor Malloy about his perspective on the issue.  To CTNewsjunkie he calls the conflict of interest accusations “ridiculous” and in a CTMirror article he described the issue as “fantastically, ridiculous.”

In an attempt to resolve the differences of opinion let’s just take a moment to review the facts.

Fact #1:  Connecticut law has a very narrow definition of what is legally a “conflict of interest”.  Basically if a public official or their family would financially benefit then it is a conflict of interest.  Both Commissioner Esty and Commissioner Pryor sought guidance from the State Office and were told that they did not have a conflict of interest.

Fact #2:   Connecticut does not have a legal definition of what would be considered the “appearance of a conflict of interest.”   In states that do have a legal definition it is usually defined as whether a “reasonable person” would think that an official has what appears to be a conflict of interest and therefore has a responsibility to take action to eliminate that appearance.

Fact #3:     As a candidate for governor and as governor, Dannel Malloy has said that ensuring transparency in government is one of his most important agenda items.  On his first day in office, the new governor issued a press release that began with IN FIRST ACT AS GOVERNOR, MALLOY SIGNS THREE EXECUTIVE ORDERS…Orders will help institute fiscal responsibility/honest budgeting, transparency…”

 Fact #4:  Although Commissioner Esty, the head of Connecticut’s Department of Energy and Environmental Protection, had an ethics ruling saying that he did not have any “legal” conflict of interest; he announced that he felt, as commissioner, he had an obligation to meet a higher standard, that being to avoid the appearance of a conflict.

Esty announced that due to his commitment to do the job right it was “prudent to insure I was in no way seen as making decisions on a company that I’ve had some close relationships with.”  With that he released a list of 26 companies and two environmental organizations which he had a close relationship.

One of the environmental groups was the Connecticut Fund for the Environment. Esty had served on the organization’s Board of Education and despite having resigned from their board he included them on the list of entities that he would recuse himself from.

Esty earned high praise from a variety of different organizations and individuals for his decision to eliminate even the appearance of a conflict of interest.

A Hartford Courant editorial called Esty’s action “the principled thing to so” and added “Avoiding conflicts of interests are a must for any commissioner but especially so in the highly volatile and often politicized realm of environmental protection.

The Courant concluded “Good for him for putting all his cards on the table and acting ethically”

When Esty later came under fire for leaving a company off his list, Malloy was his strongest defending saying that if there was any issue at all it was that Esty “should have done it [revealed his connection] out of the box”.

Governor Malloy simply could not have been clearer.  One of his most important commissioners had stepped up and set a new standard for transparency and ethics and that eliminating even the appearance of a conflict of interest required him to recuse himself on any issue related to an environmental group whose board he has served on.

Fact #5:  Connecticut’s new Commissioner of Education, Stefan Pryor, sought advice about whether he had any conflicts of interest under state law.  Ethics correctly told him he did not.

But that was never the issue.  The question is whether Commissioner Pryor has an appearance of a conflict of interest when it comes to his relationship with Achievement First, one of the nation’s largest charter management companies with nine schools here in Connecticut.

Commissioner Pryor was a driving force behind the creation of Achievement First.  Pryor, along with his colleague Dacia Toll, led the team that turned the dream of the Amistad Academy into a reality.

Achievement First grew out of that experience as the vehicle for creating more charter schools.  Pryor joined the Board of Directors of this new company.  His partner on the Amistad School project is now the President and CEO of Achievement First.

As one of Achievement First’s Directors, Stefan Pryor has been a vital part of the organization’s unprecedented growth.  Starting with the Amistad Academy, Achievement First now has 20 schools in Connecticut and New York serving almost 5,400 students. As a result of a “Management Fee” collected from each school, Achievement First collects about $4 million a year.

In 2010, Achievement First’s Board of Directors adopted an aggressive strategic plan to grow Achievement First.  The plan, which is outlined in their 2010 Annual Report, is designed to increase the number of Achievement First charter schools from 20 schools to 35 schools in the next few years.  Instead of serving 5,400 students, Achievement First plans to serve more than 12,000 students. If they utilized the present “Management Fee” system they would be collecting nearly $10 million a year.

Perhaps most importantly, Achievement First notes that when their strategic plan is implemented Achievement First “will serve more students than 95 percent of school districts in the United States”.

As Connecticut’s new Commissioner of Education and the Governor’s point person on education reform, Stefan Pryor now finds himself in the unique position of being able to determine whether Achievement First’s aggressive growth plan will succeed or fail.

Fact #6:  This is not about whether Commissioner Pryor, a well-regarded leader and change agent, should be involved in the great education reform debate of 2012.  This is not about whether Commissioner Pryor should be involved in discussions and decisions about whether Connecticut should allow the creation of more charter schools.  This debate is exclusively about whether there is the appearance of a conflict of interest when it comes to Pryor making decisions about applications from Achievement First.

The answer to that question is of course there is an appearance of a conflict of interest.  In fact, I’d assume that any reasonable person would say not only is there the appearance of a conflict of interest but there is a real conflict of interest.

This year’s education reform debate will most likely see an expansion of charter schools in Connecticut.  Even with that expansion there will be more proposed charter school seats than there are funds to pay for them.  Some charter schools will win approval and others will not.  If Commissioner Pryor plays a major role in who wins and who loses, a cloud will forever hover over those decisions.

Fact #7:  Governor Malloy said he would be the governor who brought transparency to Connecticut.

Governor Malloy applauded one of his star commissioners, Dan Esty, when Esty set a new standard of openness and honesty.  Esty even announced that he would not act on any issue related to an environmental organization whose board he has served on.

And now, when Commissioner Pryor is facing the very same decision that Commissioner Esty faced, Governor Malloy calls the suggestion that Pryor remove the appearance of a conflict of interest by abstaining from getting personally involved in decisions that would impact Achievement First “ridiculous.”

In the real world there is nothing “ridiculous” about asking Commissioner Pryor to recuse himself on this one specific area.  Commissioner Esty did so and was hailed as a champion.  It appears, at this point, that Commissioner Pryor refuses to follow Esty’s lead in any way whatsoever.

If there is something ridiculous going here it is a governor who has claimed his commitment to transparency would applaud one commissioner who strived to be transparent, only to defend another one of his commissioners who is striving not to be transparent.

  • Now that there has been so much ‘controversy’ over his work and his current position, recusing himself won’t be seen by many as the move of a champion. It is most likely going to be politically played throughout as a ‘back-down’ strategy. And that cloud will have an affect on his further work and authority regarding situations that require steadfast/hard bargaining methods as much as the affect of your aforesaid cloud.

  • Grumble

    There is one crucial question: has Pryor any current or previous financial remuneration from Achievement First?

    This is a yes or no question. If yes, you’ve got a valid comparison. Esty had such relationships and Pryor had such a relationship. If the answer to that question is no, you do not have a valid comparison.

    If you’ve got a valid comparison, then the question is how valid, and how to recuse himself. If you don’t have a good comparison, well, a lot of things look like something, but aren’t. Esty did set a precedent for his peers in this administration, you can reasonably argue. On the other hand, a personal decision on the part of one Commissioner isn’t necessarily binding on another.
    But let’s say for the heck of it that you’re right. What exactly is the power of the Commissioner of Education relative to specific applications? Is he the decider? What is the process?

    As far as transparency, Pryor’s association with Amistad, et al were well known and publicized at the time he was hired. Wasn’t it even a very positive reason given for his selection? The comparison to Esty in this respect doesn’t hold any water. Esty was disclosing prior business relationships that were not a matter of public record, and the only criticism was whether he went far enough and handled his conversations with certain members of the press as well as he should have.

    • jonpelto

      Maybe I wasn’t clear – Esty resigned from the Board of Directors of t he Connecticut Fund for the 2nvironment – an advocacy group. As a board member he was not paid, he then recused himself because of the relation he had due to the fact that he was on their Board. It is exactly the same situation as Pryor.

      I think people knew was involved with Amistad, I don’t believe know of his lengthy connection to Achievement First and as far as I know the Commissioner plays the primary role recoomending to the Board which school applications to approve.

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