Adviser under review in potential conflict case

Robbie Sherwood The Arizona Republic Dec. 11, 2005 12:00 AM

The Maricopa County attorney and Arizona attorney general are reviewing whether a top state House policy adviser had a conflict of interest when she was secretly paid for public relations work by the lobbying arm of the community college system.

The work apparently occurred after she took a job helping legislators develop bills that could benefit the colleges.

An investigator from County Attorney Andrew Thomas' office asked House officials Friday for all the documents surrounding the employment of policy adviser Kim Sheane previously provided to The Arizona Republic after a public records request.

Special Assistant County Attorney Barnett Lotstein stressed that the inquiry was not a formal investigation but was being done at the request of an unnamed citizen.

"We have received an inquiry about that matter and when we get any kind of inquiry about a public official, we don't put it in a drawer," Lotstein said. "We do a preliminary review to determine whether or not it's appropriate to do an investigation. We'll look at it closely and then make a decision relatively quickly as to whether or not it's appropriate to expend resources to conduct a full-blown investigation."

Attorney General Terry Goddard also told House officials Friday that he intended to review the matter after House Speaker Jim Weiers and House Democratic leader Phil Lopes jointly turned over documents late last month relating to Sheane's employment. An internal investigation concluded that Sheane did not break any laws or House rules.

But Weiers did demote Sheane, ordered her to return the $15,000, and forbade her from working on higher education policy because the investigation pointed to "poor judgment" and the "appearance of impropriety."

Kraig Marton, Sheane's attorney, said the matter has been fully investigated and "there is no news" to the preliminary reviews being conduced by Thomas and Goddard.

"We are confident that a 'preliminary review' of the facts will come to the same conclusions as reached before - there is and was no wrongdoing," Marton said.

The internal House investigation last month concluded that Sheane, who left her post as executive director of the Arizona Community College Association for a $115,000-a-year post on the House staff in December 2004, did not break any laws.

That probe also concluded that Sheane created "the appearance of impropriety" when she undertook a $15,000 contract from the ACCA to edit a "white paper" extolling the virtues of community colleges and for "grass-roots work" that included building support for granting four-year bachelor's degrees. Records show that Sheane wrote the $15,000 check to herself from an ACCA account nearly a month after joining the House staff, although she contends that she had pre-signed several blank ACCA checks before leaving the organization.

Sheane also stayed on the ACCA payroll for five months after taking the House job to be paid for $34,000 in backlogged vacation time.

Community college leaders were unaware of the law enforcement inquiries regarding Sheane, said John Lines, ACCA chairman and chairman of the Eastern Arizona Community College governing board.

Lines said earlier that the ACCA had no ulterior motive in allowing Sheane to do work on the so-called white paper while also working on the House staff and feels that the controversy has hurt his organization's credibility at the Legislature. Lines added that the ACCA has launched an internal audit of its finances and has tightened its controls over its budget.

"We probably didn't even realize there was anything to worry about," Lines said. "We just assumed that anything that Kim did for us was OK. It didn't even dawn on anybody that there was going to be any overlap (between Sheane's old and new jobs)."

But Lines said the ACCA's lobbying efforts to grant four-year degrees have likely received a "black smudge" over Sheane's demotion.

"I've got to think we've got a credibility problem, and we're going to have to work to rebuild that credibility," Lines said. "It's not undoable. We are a good organization and we have high goals, and we are after the right kind of think. When this popped up it was a surprise to everybody in the ACCA."

Lines also said that the ACCA rejected Sheane's first effort to return the $15,000 for the contract because she asked for unspecified conditions. Sheane has since returned the money with no conditions.