In Louisiana, lawmakers promote bills that benefit their industries

Rep. Daryl Deshotel's amendment to a bill regulating federal grants to the broadband industry raised alarm in the legislative session this year, after colleagues questioned if it could benefit his son's business.

Under fire, he withdrew the provision, which directed federal grantees to provide data to the state about the locations of utilities in their projects' paths. That amendment was filed weeks after Deshotel's son launched a utility mapping business of his very own.

But Deshotel, R-Marksville, is far from the only legislator to promote laws that could yield personal benefit. For years in Louisiana, lawmakers have shaped legislation in ways that could be a boon to their private industries or those of their families.

Also this year, Sen. Heather Cloud, R-Turkey Creek, who co-owns a trucking company, sponsored a law that reduced how much companies had to pay in certain permit fees.

Sen. Alan Seabaugh and Rep. Michael Melerine, two Republicans from Shreveport who work as insurance defense attorneys, as well as Sen. Adam Bass, R-Bossier City, who owns an insurance agency, promoted legislation that would reduce liability for insurers. And Rep. Jacob Landry, R-Erath, who has ties to oil and gas, supported a bill to lower the oil severance tax.

In past years, lawmakers have sponsored measures that would reduce competition from other businesses in their industry and promoted tax policies friendly to their businesses.

In Louisiana, a lawmaker only violates ethics rules if they get involved in a measure that would benefit them more than it would others in a group, said Kathleen Allen, the state Ethics Administrator. If others in the same profession benefit equally, that lawmaker's involvement is legal — a rule that is common in other states.

Even if the opposite is true, it is up to the Legislature to police itself. That's because the Board of Ethics typically lacks jurisdiction over legislators, Allen said.

"This is an ongoing concern," said Pearson Cross, a political science professor at the University of Louisiana at Monroe. "It didn't emerge out of the 2024 session. So as long as there have been legislatures, there have been legislators who have sought a way to make their position advantageous to either themselves or their family members or their business associates."

Louisiana has a part-time, citizens' Legislature. Many lawmakers, including Cloud, argue that having expertise in an industry is essential to writing legislation.

The Legislature has "lawyers and insurance agents voting and carrying legislation that protects their industry, family members of teachers or police officers voting and carrying legislation to protect that profession," and it has "bankers, restaurant owners, commercial fishermen, and contractors voting and carrying legislation to help that industry," Cloud said in a statement when asked about concerns that her proposal could be seen as a conflict of interest.

"That's the beauty of this Legislature: We come from diverse professions and backgrounds," she added. "We bring a heightened level of understanding from our walks of life, especially to remedy inefficiencies, faults, and failures that hinder business and industry."

The current Legislature

Cloud's law, Act 60, allows trucking companies to transfer heavy equipment permits between trucks up to four times a year. Previously, they could only be transferred once. The permits cost $2500.

In a committee meeting in March, Cloud said the bill would allow her family's company, Jody Cloud Trucking, to more easily transfer a permit if a truck breaks down. The company has six to eight trucks in its fleet but only one is permitted to carry heavy equipment, she said.

The Louisiana Illuminator first reported on Cloud's bill and how she could stand to gain from it.

In a statement Friday, Deshotel said his broadband amendment was simply an effort to enact "sound policy" but was killed because of some in the industry who did not like it. He insisted it was not a conflict of interest because his son's business was related to, but not exactly like, the sorts of businesses his bill would have benefitted.

"The amendments I proposed were in the best interest of the state, and unfortunately, that upset certain special interests," he said. "I'm not afraid of them, and they know they can't control me. I'll continue to do what's right by the people of Louisiana."

In some cases, lawmakers' personal stakes in legislation may be more nebulous, but they still have strong ties to the industries the measures would benefit.

Seabaugh and Melerine both pushed measures that would have reduced liability for insurance companies. Both work for Seabaugh's law firm, Seabaugh & Sepulvado, which counts those companies among its clients.

Advocates of Melerine's House Bill 423, a "tort reform" measure that passed the Legislature only to be vetoed by Gov. Jeff Landry, said it would reduce auto insurance rates by reducing payouts in lawsuits.

Melerine said he was not concerned about the appearance of a conflict of interest.

"If I pass a bill that is pro-insurance, one, it's pro-consumer," he said. "And then two, say we take it to the extreme and we pass the most stringent tort reform package. Hypothetically, I'd be putting myself out of a job, because if there's less lawsuits, then there's less need for attorneys."

Seabaugh did not return a request for comment.

Sen. Adam Bass, R-Bossier City, backed Melerine's proposal during a recent radio appearance. This year, he also proposed Senate Bill 172, which would have capped how much money injured parties could receive for claims related to soft tissue damage. The bill did not make it out of committee.

Bass sells insurance, according to his 2022 financial disclosure. But he claimed he didn't stand to benefit from the pro-insurance bills because they aim to lower premiums, and he receives commissions based on premium prices.

"I don't own an insurance company, I own an insurance agency, so that (legislation) would benefit my business no way, shape or form," he said.

Critics of "tort reform" legislation have questioned if the changes would truly help lower rates.

Landry, who runs or has ownership stakes in companies that offer oilfield project management, promoted House Bill 259 this spring. The bill would have reduced the oil severance tax. It is unclear whether Landry would have benefitted directly from the bill—his companies appear to provide services for oilfields, and The Advocate | The Times-Picayune did not find evidence that he pays taxes on oil himself.

Landry did not return a request for comment, and HB 259 did not pass the Senate.

A decades-old issue

Legislators have long wielded their influence in ways that have raised conflict of interest concerns.

In 2007, then-state representatives Alex Heaton, a Republican, and Jeff Arnold, a Democrat, came under scrutiny after they fought legislation that could have affected their relatives' tax assessor jobs. Heaton's brother and Arnold's father were New Orleans tax assessors, and the legislation consolidated the city's seven assessors into one office.

Noting the legislators won a fight against the ethics board, Arnold stressed that there was no conflict of interest because his father had nothing to gain from the failure of the bill. That would have maintained the status quo, with his father still in his job, he said.

For the bill to be detrimental, Arnold's father would have had to run for the single assessor's job and lost, Arnold said, adding that his father decided to retire rather than run for the position.

Heaton died in 2010.

In 2017 and 2018, Sen. Bob Hensgens, R-Abbeville, and then-Sen. Fred Mills, R-Breaux Bridge, lawmakers with stakes in the nursing home industry, pushed legislation that could have limited competition from assisted living facilities.

In 2018, Rep. Jack McFarland, R-Jonesboro, who owns a timber company, proposed an amendment to a sales tax bill to include an exemption for loggers, paper and wood manufacturers, and then-Rep. Lance Harris, R-Alexandria, who owned a chain of convenience stores and gas stations, introduced a bill that would have made it more difficult for large retailers to sell gas at lower prices than his.

The legislators said the bills were in the interest of their constituents.

"The largest industry in my district that I represent is timber," McFarland said, and Hensgens said the assisted living facilities bill was meant to address a budget issue.

The lawmakers also said they were often sought out to legislate in areas in which they had expertise. Some said that, when weighing in on legislation, they considered whether a bill impacted their business more than others in a group. If it did not, they were free to vote on it.

"Every bill benefits or affects my constituency in some way," Hensgens said. "As long as you're voting for a group or a whole...it's ethically necessary, or we'd all be half the time not voting."

Disclosure comes into play

For many lawmakers, it can be difficult to know where to draw the line.

"On the one hand, one can just look and say 'Hey, if this is going to benefit my industry and I'm promoting this legislation, it's a clear conflict,'" said Barry Erwin, president of Council for a Better Louisiana. "And then on the other hand, some of these industries are very big and broad."

If a legislator does cross a line, their colleagues may be reluctant to act.

"No one wants to be the target of an ethics complaint by their colleague, and everyone knows that an ethics complaint can be used to attack someone in a duplicitous manner," said Cross.

The status quo comes with some benefits, Cross acknowledged. A lawmaker could propose a bill that benefits them but also makes sense for an industry, he said. He added that having lawmakers with expertise in various industries is key to making the Legislature work.

Deshotel, who worked in the broadband industry, said his expertise helped secure $1.5 billion to expand high-speed internet across the state. "It's crucial for me to lead on broadband issues, just as a clinician would on healthcare," he said.

The solution, many say, is disclosure, which allows voters to decide whether legislators are abusing their power.

"To me, the antidote is more transparency, so that voters know," said Steven Procopio, head of the Public Affairs Research Council of Louisiana.

The Associated Press contributed to this report.