Last week, Washington City Paper published a cover profile of Jack Evans, Ward 2’s D.C. Council member since 1991. It’s recommended reading, a trenchant look at a man who, reporter Alan Suderman writes, “seems terribly unhappy in a job he desperately wants to keep” and “wants to be a big player in a city government he can’t stand.”
One thread left dangling in the story is the matter of Evans’s considerable outside income. As is fairly well known, Evans (D) works for Patton Boggs, the law and lobbying giant. But Evans told Suderman that he’s had other employment besides his Patton job:
Evans was similarly tight-lipped when I asked about why his outside income dropped from $240,000 during the previous four years to $190,000 last year. Had he gotten a pay cut? No. Evans would only say that Patton Boggs has always paid him $190,000. He wouldn’t indicate where the extra $50,000 had been coming from.
When pressed, Evans said he was following city law. “It doesn’t require that to be disclosed,” he says. “That’s my answer.”
Indeed, city law requires Evans to disclose the amount of his outside income, but not necessarily its source. Turns out, Evans worked an insurance executive for nearly a decade unbeknownst to many.
In January 1999, Evans was hired as vice president of corporate development for Central Benefits Mutual Insurance Co. His hire was covered in The Washington Post that March, in a reporters’ notebook column, after he recused himself from voting on a bill dealing with the insurance industry.
In the late ’90s, Central Benefits was a mid-sized health and life insurer, based in Columbus, Ohio, that had its eye on a expanding its offerings — adding property insurance, contract bonding and workers’ compensation coverage to its portfolio. It hoped to accomplish this expansion though a series of corporate takeovers, which would require raising capital through a stock offering, something it could not do as a mutual company, owned solely by policyholders.
In Ohio, the rules for converting to a stock company were restrictive, so Central Benefits decided to move its corporate domicile to the District, taking advantage of a favorable demutualization law that went into effect in 1996 — a law Evans had supported as a member of the Consumer and Regulatory Affairs committee.
Evans said he played no role in luring Central Benefits to D.C. — “they had determined that on their own,” he said. But the company turned to Evans — then a partner with its corporate law firm, Baker & Hostetler — to be their man in Washington.
While “vice president for corporate development” might sound grandiose, Evans said Monday that his duties for Central Benefits were “really not much.” He served as the company’s registered agent, meaning it was his job to keep the Central Benefits’ corporate registration in good standing and pick up the mail. Evans said he did not lobby for the company or deal with city insurance regulators — which, he said, fell to lawyers with Baker & Hostetler.
For this, Evans was paid at least $50,000 a year until Central Benefits went out of business. The company never did, in fact, proceed with demutualization; rather than embarking on an acquisitions spree, it spun off the various parts of its business until it dissolved in September. A 2010 court filing includes a severance agreement Evans signed in November 2008 (witnessed by his council chief of staff) that paid him another $50,000, bringing his total compensation from Central Benefits to about a half-million dollars over the course of a decade — not a bad payday for picking up the mail.
Those who have kept a close eye on Evans’s law-firm dealings will wonder whether his D.C. Council service could have benefited his lesser-known employer. A review of council records shows that Evans recused himself from certain votes that might have had some bearing on Central Benefits, including changes to the demutualization law and a bill to give doctors more negotiating power with insurance companies. But he did not recuse himself from insurance matters more generally, following a 1999 Office of Campaign Finance opinion that found that the potential conflict of interest given his chairmanship of the Council’s finance committee was “limited.”
The campaign finance office held that Evans “should avoid personal representation” of Central Benefits before the city insurance regulators, which the finance committee oversaw at the time, and that he “should recuse himself, on a case-by-case basis, from any official action before the subcommittee as it relates directly to the Company.”
There is a bit of a twist for those looking for evidence of public-private coziness: For a time, Central Benefits had its corporate office in the same office suite as a registered lobbyist, David Julyan, who has long had close ties to Evans — serving, at one point, as treasurer of his public affairs committee. Julyan is best known as a lobbyist for city parking lot operators, though he has also lobbied Evans and others for MedStar Health and other interests, according to lobbying reports. Julyan did not return a call for comment Monday.
Evans said Monday that Central Benefits maintained a separate office from Julyan, rented at market rate from the building’s owner — parking and real-estate mogul Leonard “Bud” Doggett Jr., who died in 2008 — after the company moved to cut costs. “It was more of a post office box arrangement,” he said.
All of this, as it happens, appears to be perfectly legal; under current law, there was no requirement that Evans disclose the source of his income if it didn’t come from a company that “transacted business” with the city or “stands to gain a direct financial benefit from legislation that was pending before the Council.” While the above facts could be pieced together from public records in a few hours, I never would have known where to look had someone not tipped me to the company’s name.
The draft ethics reform bill released Friday by Muriel Bowser (D-Ward 4) would for the first time mandate the public officials disclose the source of all their outside income. Evans said he has no problem with Bowser’s proposal.