CMD Calls for Nebraska Ethics Investigation over ALEC Keystone “Academy” Junket

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-- by Nick Surgey and Brendan Fischer

The Center for Media and Democracy filed a complaint yesterday with the Nebraska Accountability and Disclosure Commission alleging that Nebraska Senator Jim Smith, a major proponent of the Keystone XL pipeline, failed to disclose significant travel expenses paid for by the Government of Alberta, Canada during Smith's participation in an "Oil Sands Academy" organized by the American Legislative Exchange Council (ALEC). The trip was sponsored by the operator of the Keystone XL pipeline, TransCanada, which may raise additional concerns under the ethics and lobbying code.

Smith and nine other ALEC legislators participated in the "academy" sponsored by TransCanada in Alberta, Canada last October, where they were shepherded around oil extraction facilities and rubbed shoulders with oil industry lobbyists. The Government of Alberta even chartered a flight during the tour to fly the participants to tar sand operations, which reportedly cost around $1,500 per legislator.

But a review of Smith's 2012 statement of financial interests shows no record of the ALEC tour.

Smith Disclosed Nothing about the ALEC "Academy" in Ethics Filings

Under Nebraska law, Sen. Smith should have disclosed any gifts he received in 2012, including any gifts of travel, but he failed to report the Alberta government funded charter plane flights, or anything else he may have received on the trip. There is little evidence that Sen. Smith told his constituents anything at all about his participation in the "Oil Sands Academy."

But Sen. Smith has been exceptionally vocal when it comes to his support for the Keystone XL pipeline. Smith sponsored a 2012 Nebraska law that would -- if it survives a continuing legal challenge -- bypass the U.S. State Department and allow TransCanada to start building the Nebraska part of the pipeline right away, regardless of any future decision by the State Department. Smith is also the ALEC State Chair for Nebraska.

Documents obtained by CMD show that the total cost for chartering the flights to the tar sands came to $22,000 -- or $1,466 per person -- with part of this cost being paid for by the Alberta government, and the rest by another unnamed party. CMD alleges in its complaint that Sen. Smith should have disclosed the receipt of these gifts.

According to the Financial Times, the Government of Alberta has recently hired a "who's who of lobbyists and communications professionals with links to the Obama administration -- and to John Kerry in particular" to promote Keystone XL, and recently took out a half page ad in the New York Times calling for its approval. In addition to paying tens of thousands of dollars to shepherd Sen. Smith and other state legislators around the Canadian tar sands, the government of Alberta sent two of its own representatives on the ALEC tour.

"Nebraskans have a right to know if their legislators are being lobbied by foreign countries and foreign corporations," Jack Gould of Common Cause Nebraska told CMD. "When an issue as important as the XL pipeline is being studied, all lobbying activity should be visible."

Pipeline Operator TransCanada Sponsored ALEC "Academy"

As CMD reported, the ALEC "Oil Sands Academy" was a three-day endeavor that included tours of TransCanada's facilities in Calgary, corporate-sponsored meals, and presentations from lobbyists. When ALEC invited legislators on the trip, it offered to pay for their lodging at the Westin Calgary, which reportedly cost $648.92 for two nights, and their airfare from the United States to Canada, which can cost hundreds of dollars more.

Documents obtained by CMD show Sen. Smith staying in the "ALEC room block," but Sen. Smith told CMD that he funded his own lodging expenses and air travel to Canada.

The "sponsors" of the ALEC Academy included TransCanada and the oil-industry funded American Fuel and Petrochemical Manufacturers (AFPM), which has lobbied for the pipeline's approval by the U.S. State Department. ALEC Academy sponsorship costs $80,000; these sponsorship fees would presumably help fund legislators' travel and lodging expenses.

It is not known whether Sen. Smith indirectly received any benefits as a result of TransCanada's financial sponsorship of the trip. As a corporation that lobbies in Nebraska -- in fact, as the corporation that has spent the most on lobbying in Nebraska over the past two years -- it is prohibited from providing gifts to legislators that exceed $50 in any one month. CMD has asked the ethics board to investigate whether Sen. Smith accepted any impermissible gifts on the trip.

Senator Smith Gets by with a Little Help from TransCanada

Although it is not clear if Sen. Smith accepted anything from TransCanada on the ALEC oil sands tour, he has needed their help in the past. In February 2012, during hearings on Sen. Smith's pro-Keystone XL bill, LB 1161, a TransCanada lobbyist came along to provide more than moral support.

"Sen. Smith could not answer fellow state senators' questions about LB 1161," Bold Nebraska's Executive Director Jane Kleeb told CMD, who suspects that TransCanada wrote the bill and Smith was merely doing their bidding. "Everyone in the hearing room knew exactly why Sen. Smith kept on referring the majority of questions he could not answer to TransCanada's lawyers."