State changes law that forced alderman to resign

The state law that forced former Racine Alderman Pete Karas to resign is close to being changed. The Senate passed Assembly Bill 500 this week that would allow local elected officials to recuse themselves from a vote involving liquor licenses, if they do business with clients who have liquor licenses. Under the old law, city alderman could not serve in local government if they had clients with liquor licenses.

Karas, an insurance broker and risk manager, abruptly resigned from the council last year after learning about the Prohibition-era law. He has clients with liquor licenses.

The bill is awaiting Gov. Jim Doyle's signature, which should come without question.

Here's a press release from Rep. Louis Molepske, Jr. on the bill:

Assembly Bill 500 passes Senate

On Tuesday, the Wisconsin State Senate voted to pass Assembly Bill 500, a bill which provides some much needed balance between the high ethical standards that local elected officials considering alcohol licensing requests must abide by and the reality that some of these very officials may have long-standing businesses that sell products to the license applicants or license holders.

The bill now awaits Governor Doyle’s signature before becoming law. Under a little-known state law, no member of a municipal governing body is permitted to sell to anyperson holding or applying for a retail liquor license “any bond, material, product, or thing that may be used by the licensee in carrying on the retail business.”

This extremely broad Prohibition-era regulation was originally enacted due to the fact that municipal governing bodies are responsible for granting retail liquor and wine licenses. The law’s authors were concerned that this process could create the potential for private business to unduly influence governmental operations, or vice versa.

As the issue has gained publicity in recent months (the bill was recently featured in USA TODAY ), a number of alderpersons in municipalities across the state have struggled with the decision of whether or not they need to resign their seats. Assembly Bill 500 addresses these concerns by replacing current law with a revised version of the well-established Code of Ethics for local public officials.

More specifically, under Assembly Bill 500, rather than being forced to resign his or her seat, if a local government official is presented with a situation in issuing or denying a retail liquor license that the official thinks or knows will violate the Code of Ethics, the official should recuse himself or herself from the vote on the license.

“Assembly Bill 500 will ensure that municipal officials are subject to the same ‘pay to play’ regulations as other public officials, but at the same time, they will not be prohibited from simply making a living or partaking in public service,” said Molepske. “Being an alderperson is generally not a full-time job, meaning that alderpersons often have other forms of employment to supplement their income. Assembly Bill 500 helps to ensure that our elected officials will come from diverse backgrounds, both personally and professionally.”