There is an old Reader’s Digest anecdote about a wealthy but absent-minded tycoon asking his top manager, “How long have you worked here?” To which the man says 30 years. He then asks, “How much am I paying you?” The manager tells him, and he finally says “And what is your name?”
It seems a little far-fetched that you might not know who you are paying, or how much you are paying, or how long you’ve been paying, but that happens to taxpayers all the time. If public funds are used to pay millions to particular groups or individuals, taxpayers are entitled to know it. But a 20-year string of “sue and settle” legal cases have been used to funnel untold billions of tax dollars to giant environmental organizations and their attorneys, mostly hidden from public discovery by sealed court decrees.
A 2017 White House Executive Order calling for greater transparency prompted both the EPA and Interior Department to begin significant changes in the handling of information about these legal settlements. Last week Interior put the finishing touches on its new policy, ending the secrecy, if not the settlements themselves, and the big environmental groups are not happy. What a surprise. I have written about this issue before, pointing out that these organizations object to the phrase “sue and settle.” They say it oversimplifies a very complex legal procedure, but in fact, the strategy isn’t complicated at all.
Government officials, frustrated by the cumbersome process of decision-making, use “sue and settle” as a way to short-circuit that process. A “friendly” organization files a lawsuit demanding the very action the officials want to take anyway. So the government reaches an out-of-court settlement, in which it agrees to the action demanded by the lawsuit, and agrees to pay the organization’s legal fees in return. The court agrees to the settlement, part of which often seals the details (such as legal fees), making it difficult for anyone to track these deals. That secrecy will no longer exist under the new procedures just announced at Interior.
Earlier this spring, Congress passed the landmark “Natural Resources Management Act,” and among hundreds of pages of other sections, finally included a long-sought requirement for tracking and disclosing attorney fees paid by the government to settle environmental lawsuits. The law now requires agencies to report such settlements in an online searchable database. Interior officials have done just that, in a new order from the Solicitor directing the creation of a new “Attorney’s Fees” web page. It will list, for all legal settlements involving attorney’s fees, the case name and citation (with a link to the case itself), the total amount of attorney’s fees and costs paid, and the names of the parties to whom the payments are made.
You might have thought this was always public information, since it is public money. And it was, at first. Congress passed the “Equal Access to Justice Act” (EAJA) in 1980, allowing payment of attorney’s fees so that small groups could afford to sue the government. Until 1995, EAJA payments were about $3 million dollars a year. Then, the Clinton Administration decided to stop collecting the data, so agencies could tell nosy congressmen, “We don’t know how much was paid to whom; there’s no database.” Predictably, the payments skyrocketed. So did the abuse. Interior now says between 2012 and 2017, it agreed to at least 460 legal settlements, paying the plaintiffs more than $4.4 billion. That is the tip of the iceberg because it’s only one department. The EAJA law capped the hourly rate for attorney’s fees at $125, but courts routinely waive that cap, recognizing that environmental law requires “special skills.” Now, attorneys often bill the agencies $750 an hour or more, and the government pays it. Finally, EAJA was meant to help small organizations, defined as those with less than $7 million in assets. Yet the Washington Examiner reported on one environmental group with more than $20 million in assets, which has sued the Trump Administration more than 100 times, and has been awarded attorney’s fees by the courts.
Interior Secretary David Bernhardt pointed out that “In many cases, entering a consent decree or settlement agreement may be a prudent use of taxpayer resources to avoid costly and drawn out litigation…” Indeed, the new policy will not eliminate reasonable settlements, just the secrecy that invites corruption. It is a vital and long-overdue reform, because taxpayers, like the old business tycoon, are entitled to know how much they are paying, and who they are paying.
This column originally appeared in the Grand Junction Daily Sentinel May 24, 2019.
Comments on this entry are closed.