For most of the time Jules Bailey served in the Oregon Legislature, he owned a one-man economic and sustainable development consulting company.
It is unclear how many clients he had or what he did for all of them. Only one has previously been reported – the Clean Energy Development Center, a nonprofit organization that also retained former first lady Cylvia Hayes to work on environmental issues.
Bailey, who was elected to the Multnomah County Commission in 2014, is now running for Portland mayor. He has refused to identify his other clients to the Portland Tribune. Bailey’s campaign consultant Stacey Dycus declined numerous requests to name them or make Bailey available to discuss them.
“Asking a consultant for clients is like asking an attorney or doctor,” Dycus said in an email to the Portland Tribune.
But two other clients can be found through Internet searches and a close reading of annual Statements of Economic Interest filed by Bailey with the Oregon Government Ethics Commission. And, like the Clean Energy Development Center, they had an interest in business before the Legislature, where Bailey represented Southeast Portland in the Oregon House of Representatives from 2009 to 2014.
One was Horizon Wind Energy, a private company hoping to expand its Eastern Oregon wind farm operations. The other was Climate Solutions, a nonprofit organization working to reduce carbon emissions and increase the use of renewable energy.
Among other things, both had an interest in saving the embattled Business Energy Tax Credit program during the 2011 Oregon Legislature. Some legislators wanted to kill it because the amount of tax credits being claimed on projects like wind farms was spiraling out of control.
As co-chairman of the Joint Committee on Tax Credits, Bailey helped craft a compromise that allowed a scaled-back version of the program to continue.
After the session, Climate Solutions claimed saving the program was one of its top accomplishments. “Defended key financing for clean energy in Oregon: We brought together a diverse coalition of clean-energy partners to defend clean-energy financing in Oregon and successfully preserved a key part of the Business Energy Tax Credit in the 2011 legislative session,” the group wrote.
Bailey did not announce a conflict of interest on the House floor when he voted for the compromise. Dycus adamantly denies he did anything wrong.
“Jules did not work with, advise, or consult with Climate Solutions on any Oregon project or policy, or for any client. Jules’ business was not an end run around our ethics laws, it was an honest way to earn a living that he was educated for. He had strict guidelines in place to not work on Oregon policy,” she emailed the Portland Tribune.
Loophole in ethics laws
It is not against the law for public officials in Oregon to accept money from people, businesses, nonprofit organizations or government agencies with interests before the bodies they represent. But their names must be reported on forms filed with the Oregon Government Ethics Commission if the payments exceed $1,000 in any given year.
However, their names do not have to be disclosed if such payments are not made directly to the public officials, but are instead made to companies owned by them, which is what happened in Bailey’s case. The same is true of businesses or nonprofit organizations that employ public officials.
“The state of Oregon does not make people list their clients. Attorneys don’t have to list their clients, and neither do certified public accountants,” says Ron Bersin, executive director of the Oregon Government Ethics Commission.
But that arrangement effectively prevents voters from knowing whether public officials are doing business with entities that have interests in their offices – and determining whether such relationships are affecting their public duties.
“That’s the question,” says Jim Moore, a Pacific University political science professor who heads the Tom McCall Center for Policy Innovation. “You can certainly disclose a client, but there is not an obligation to do so. Oregon’s ethics laws have all kinds of loopholes and gray areas.”
Political career path
Before starting his own consulting company, Bailey earned two master’s degrees from Princeton University in 2007, one in public affairs and the other in urban and regional planning. That same year, he was hired as a project manager for ECONorthwest, a Portland-based economic consulting firm.
Lorelei Juntenen, an ECONorthwest partner and project manager, remembers Bailey as a well-qualified worker who was liked by the company’s other employees. Among other things, she says Bailey worked on economic development plans for Washington County and Portland State University.
Bailey was elected to Oregon House District 42 at the November 2008 general election and left ECONorthwest in June 2009. He started his own company, Pareto Global, two months later. It is named after Vilfredo Federico Damaso Pareto (1848-1923), an Italian economist responsible for popularizing the use of the term “elite” in social analysis.
“We were sorry to see him go, but he was on a political career path,” Juntenen says.
It is unclear how many clients Bailey had over the years. He listed Pareto Global as a source of income on the disclosure forms he filed with the Oregon Government Ethics Commission while serving in the Legislature, but did not itemize the company’s clients, as permitted by law.
Bailey listed his company’s clients on his federal income tax returns. He has only released the returns from 2012, 2013 and 2014, however. And all of the client names are redacted except for the Clean Energy Development Center, which had been reported by the time Bailey released the returns.
Despite most of the names being redacted, Bailey’s firm did not appear to have many clients between 2012 and 2014.
According to the returns, Bailey’s firm received income from two clients in 2012. One was $21,000 from the CEDC. The other was $32,259 for a client whose name was redacted.
Bailey’s firm received modest income from two clients in 2013. Both are redacted. One was for $2,100. The other was for $1,000.
And Bailey’s firm received income from two clients in 2014. Both are redacted. One was for $5,250. The other was for $1,000.
Bailey’s consulting job
Bailey’s work for the Clean Energy Development Center was previously reported by the Portland Tribune on Jan. 19 (“Bailey says link to Cylvia Hayes is non-issue.”). He was paid $78,000 to increase state support for clean energy programs in Rhode Island. Bailey says he quit the project after six months because the CEDC’s staff economist left and the group was “imploding.”
In the previous Portland Tribune story, Bailey said the work did not pose a conflict of interest with his legislative duties because it did not involve Oregon.
“I had real work on a discrete contract that ended after six months,” Bailey said of the Rhode Island job.
The CEDC did have an interest before the Oregon Legislature, however. In a February 2012 fundraising letter, the CEDC talked about working in Oregon on multistate initiatives, as well as a 10-year Oregon energy plan and a “strategic approach” to blocking coal export facilities on the West Coast. And in 2014, the group conducted polling and organized a coalition to push for the stalled Oregon low-carbon fuel standard – a policy supported by then-Oregon Gov. John Kitzhaber, leading environmental groups and most legislative Democrats.
After leaving ECONorthwest, Bailey partnered with his former employer to evaluate the potential economic impact of a 300-megawatt wind farm proposed by Horizon Wind Energy in Eastern Oregon. The company already had built the 101-megawatt Elkhorn Valley wind farm in 2007 and had applied to the Oregon Department of Energy to build the Antelope Ridge Wind Farm near Union.
The Observer, a La Grande newspaper, did a story on the economic impact evaluation on Feb. 16, 2010. It identified Bailey as the principal consultant for Pareto Global and quoted him as saying, “Our modeling showed that wind farms have a positive economic impact, create job growth and increase revenue to local governments.”
According to the article, the company planned to take advantage of state tax breaks authorized by the Oregon Legislature to help finance the project. The application was withdrawn in September 2013 because of poor market conditions.
Also in 2010, Bailey was identified as the primary author of a report by Climate Solutions, a Seattle-based nonprofit organization, on multistate strategies for financing clean energy projects. The May 2010 report was titled, “Energizing Cities: New Models for Driving Clean Energy Investment.” Among the options it discussed were state regulatory and financial incentives.
“One emerging model is for local governments to use one-time dollars to establish a precedent that validates the concept for broader statewide legislation or structural realignment of public or private sector energy financing,” says the 47-page report partly funded by the Sequoia Foundation, a California-based environmental research and advocacy organization.
The next year, Bailey played a large role in passing legislation that Climate Solutions claimed as one of its most important accomplishments.
Although Bailey has declined to identify all of his clients, Dycus says that none of his consulting work ever posed a conflict of interest for him at the Legislature – especially those interested in clean energy projects.
“Jules went to school for economics and clean energy, he became an economist for clean energy, he got elected to office talking about clean energy. Clean energy is one of the main reasons he got into public service. If his clients had clean energy missions, it makes sense, because that is what he does,” Dycus emailed the Portland Tribune.