NC Commerce secretary can't serve two masters

Taxpayers think that N.C. Commerce Secretary Sharon Decker works for them, but the state isn’t the only entity paying her. Family Dollar is paying her more.

Decker makes $136,000 as commerce secretary. But last year she received $149,546 in cash and stock for serving as a board member for the discount store chain.

Taxpayers might be surprised to learn that the woman they pay to rustle up jobs is earning more from her outside work than her government post. Indeed, they might be surprised that she has outside employment at all. But the state’s porous ethics law allows Cabinet members to serve two (or more) masters as long as the officeholders disclose their outside earnings, as Decker has.

Now this leniency that ignores the appearance of conflicts is allowing the creation of more than an appearance. Family Dollar’s board recently chose between rival offers to purchase the company. If the board had accepted, for instance, the $9.1 billion proposal from Tennessee-based Dollar General, it could have put Family Dollar’s Matthews headquarters and 1,400 corporate jobs at risk.

Would a commerce secretary, the state’s top job protector and recruiter, cast a vote as a board member that could cost the state 1,400 jobs? That’s a possibility for a secretary caught between serving taxpayers and shareholders. And Decker is herself a substantial shareholder. Eric Frazier of The Charlotte Observer reports that, according to Bloomberg data, Decker owns 7,439 shares of Family Dollar stock worth nearly $600,000.

Not to worry, Decker says. “In my role at Family Dollar, I am a board member and have fiduciary responsibilities to the shareholders,” she said in a statement last week. “As commerce secretary, I work every day to create jobs and help North Carolina thrive. I can perform both roles and meet my responsibilities.”

You can’t properly serve as a public official and a private director and always meet your obligations to keep the interests of the people of North Carolina first. The state’s toothless law doesn’t require suspending business ties while serving in appointed office, but Decker should have suspended her connection with Family Dollar upon taking office and certainly should do so now.

That she sees no conflict is especially unnerving given the changes occurring in the Commerce Department. This year, Decker and Gov. Pat McCrory pushed through a bill transferring some commerce department functions to a private-public partnership that will recruit business to come to North Carolina. It will also leave the state exposed to conflicts of interest by private agents pledging state money. Supporters of the idea say it will make the state’s recruitment process more “nimble.” Which is to say it will proceed without the disclosure and ethics burdens carried by public agencies.

The partnership will be based in Cary and governed by a 17-member board appointed by the governor, House speaker and Senate president pro tem. As an agency outside of state government, it will be a challenge to keep its employees within the same guidelines that seasoned state employees know well.

The public-private approach has been tried in other states. It has drawn charges of conflicts of interests and hidden dealings as state incentives are given to companies without proper oversight.

Decker says North Carolina has learned from the problems elsewhere and its partnership will avoid conflicts as it dispenses millions of state dollars. But the commerce secretary’s lack of concern about her own awkward wearing of multiple hats raises questions not only about what she has learned, but how much she wants to learn about earning and keeping the public’s trust.

This story was originally published September 9, 2014 at 8:08 PM with the headline "NC Commerce secretary can't serve two masters."