Myers’s ties to AccuWeather remain deeply concerning. He recounted for the Senate how he and his family built the company from the ground up to become a dominant player in the weather forecasting industry. In addition to Myers serving as its CEO, his wife was its director of executive projects, and his brothers held more than 90 percent of the company’s stock.
When his nomination was first announced, we were concerned about whether Myers could be relied on to oversee an agency that can directly affect his family’s business. AccuWeather uses NOAA’s free weather data to make its own predictions, which it then sells to the public. AccuWeather has also argued that NOAA should reduce the amount of weather information it releases directly to the public — that is, much of the data generated by NOAA with our tax dollars would be available exclusively to private companies like AccuWeather that could then sell us forecasts based on that data. Myers himself has advocated that NOAA do less for America so AccuWeather can increase its profits.
This history raised serious questions about Myers’s ability to act impartially, which fueled a public outcry that stalled his first nomination. The clock ran out for Myers in January when the new Congress took office.
Now Myers is back with a new nomination and a mysterious financial arrangement. A year ago, one of us, writing for the Campaign Legal Center at the time, warned the Senate that “nothing in his ethics agreement would prevent him from selling his shares of AccuWeather to his family and, upon leaving the government, offering to repurchase those interests for the same price — possibly even at a negligible price or, at least, without incurring any capital gains.” And indeed, a few months ago, Myers sold his stock under a redemption agreement, which is a contract that lets a closely held company or its shareholders buy back an investor’s stock. Financial disclosure forms show that Myers sold for a fraction of what he previously claimed it was worth.
In the disclosure report Myers filed with his first nomination, he valued that stock as worth between $25 million and $50 million. Bloomberg Businessweek reports that it has obtained another document in which Myers placed the value higher, at $57 million. But Myers’s latest financial disclosure report reveals that when he was renominated in January, he sold the stock, apparently to his family or their company, for just $15.9 million. That figure seems especially low given that Myers earned almost $1.4 million in passive investment income as a stockholder in 2018 alone.
So, how has Myers explained this great disparity? Myers does not appear to have offered any public explanation. And the Senate appears ready to confirm him without demanding one. AccuWeather said in a public statement in January that Myers had divested his holdings in the company to fulfill an ethics pledge he made, but selling stock before confirmation is unusual. (A lawyer for Myers wrote to members of the Senate committee that oversees NOAA last year that Myers is “making a total, clean break with AccuWeather interests and he has no arrangements or agreements whatsoever to return to AccuWeather.”)
But, in fact, these circumstances raise the possibility of a sham transaction. It’s not clear what could have motivated the drastic discount. There may well be a legitimate explanation: Maybe it’s remotely possible the company lost more than half its value in the past year, maybe he was wrong about its value in the first place, or maybe negotiations for the sale just went badly for him.
Whatever the reason, though, the Senate has a constitutional duty to obtain an explanation before confirming Myers. That means obtaining a copy of the redemption agreement and any independent valuation used to determine the sale price. It also means getting Myers to explain the transaction and affirm that neither he nor his wife will ever repurchase shares of AccuWeather. Otherwise, anything NOAA does to benefit AccuWeather under Myers’s leadership could ultimately benefit Myers himself.
The past two years have taught us a number of lessons about the infirmities of our government ethics program, and we are about to learn another one. In a letter to the Commerce Department’s lead ethics official, Myers makes clear that, if the Senate confirms him as head of NOAA, he will not recuse himself from all “particular matters” benefiting AccuWeather. He promises only to implement a narrow recusal from matters in which AccuWeather is an identified party, such as a litigation, contract or grant. He leaves open the option to participate in decisions affecting AccuWeather as leading competitor in the weather forecasting industry — for instance, a decision to accede to the company’s demand that NOAA reduce the amount of weather information it releases directly to the public.
Myers’s attorney told the Senate that it was unfair to expect Myers to “operate under tighter constraints than those imposed by the most impartial arbiter available under the law.” But this argument ignores limitations the existing legal framework for ethics imposes on the Office of Government Ethics, which lacks any mechanism to compel Myers to do more to resolve his conflict of interest. In this context, we should be worried about his refusal to adopt a broader recusal.
The Senate’s advise-and-consent role in the nomination process is a constitutional safeguard that should be used to plug gaps in conflict-of-interest laws. For example, the Senate Armed Services Committee routinely insists, as a condition of confirmation, that all nominees within its purview divest any defense contractor’s stock, whether or not that stock would pose a conflict of interest. This practice is a wise prophylactic measure, but it is one the law most certainly does not require. The Senate Commerce Committee should follow suit and demand, as a condition of confirmation, that Myers recuse himself from any particular matter benefiting AccuWeather.
We need to be able to count on the Senate to act as a constitutional guardian of government integrity. If not, we may as well stop asking what NOAA can do for us and start asking what NOAA can do for the Myers family.