Democrat intros bill to fix so-called ‘Buehler loophole’

Nearly a month after the Democratic Party of Oregon filed an ethics complaint against Rep. Knute Buehler, R-Bend., a Democratic lawmaker has introduced legislation that would close what the party calls the “Buehler loophole” in state laws governing required public disclosure of payments to elected officials by those who do business with the state.

The party issued this news release on the measure:

Legislation introduced Wednesday by Rep. Dan Rayfield would close the “Buehler Loophole” in state ethics laws and require additional reporting and transparency from public officials. Rayfield’s bill, HB 3457, follows an ethics complaint filed by the Democratic Party of Oregon (DPO) against Rep. Knute Buehler for failing to disclose years of payments from companies that do business with the State of Oregon.

Rep. Buehler has received royalties, served as a paid consultant, paid speaker and presenter, and paid researcher for multiple health care-related businesses, including Stryker Corporation, a medical device company that is a contractor with the State of Oregon. Stryker has also been fined for violating anti-corruption and anti-kickback laws after an investigation of its activities in five countries by the Security and Exchange Commission.

“Public officials are supposed act on behalf of the public, not the people who pay them,” said Jeanne Atkins, Chair of the Democratic Party of Oregon. “Transparency in financial reporting is essential for the integrity of our system. We applaud Rep. Rayfield’s commitment to close the Buehler Loophole and bring these payments from the shadows into the light.”

Currently, public officials are required to disclose income greater than $1,000 from businesses, organizations, or individuals that have legislative interests before the State of Oregon. But current law does not require public officials to report income paid to a business owned or run by a public official, even if the payor entity has business before the state.

This loophole would be closed by HB3457, which would require public officials to report sources of income to businesses they own or run if that income is 10% or more of that business’s total income.

The DPO filed an ethics complaint against Rep. Buehler on April 12 for failing to report income from Stryker Corporation on his 2014, 2015 and 2016 Statements of Economic Interest. Rep. Buehler admits that as a doctor and state legislator he continues to accept consulting payments from Stryker but has countered that he does not have to report that income because the money was moved through a company he owns. The Bend Bulletin recently reported that company is registered at Rep. Buehler’s home address.

The payments from Stryker only came to light because a federal transparency law requires medical device companies to report their payments to doctors in the U.S., including Rep. Buehler, who is a surgeon in Bend. The reports show the company paid Rep. Buehler personally, to the tune of $67,500 between 2013 and 2015–payments Buehler did not disclose in Oregon. Stryker currently has a $150,000 contract with the Oregon Department of Corrections and could be expected to have an interest in health care and other legislative policy on which Rep. Buehler could have a vote.

The Oregon Government Ethics Commission has not yet ruled on whether Buehler violated state ethics laws in failing to report these and other payments since 2013. Rep. Rayfield took action Wednesday to clarify any ambiguity in reporting requirements.

“Whether payments are received by a lawmaker or by companies they have an interest in, they should be reported. If the law isn’t 100% clear on that, the Legislature should make it clear so there is no excuse for hiding payments from any entity in any form,” Atkins said. “This legislation is necessary to better understand the financial ties and potential conflicts of interest of our public officials as well as the types of entities they are affiliated with.”

In 2013, Stryker paid the Securities and Exchange Commission more than $13.2 million for violations of the Foreign Corrupt Practices Act. And in November of 2014, Stryker agreed to pay more than $1 billion to settle thousands of lawsuits by US patients who had surgeries to revise problematic Stryker hip replacements.

Buehler issued this statement Thursday about the allegations:

“Rather than improving schools, fixing roads or balancing the budget, Democrats continue to peddle bogus, politically motivated claims that have no basis in fact and do nothing to improve the lives of Oregonians. It’s sad.”