BOSTON — State Sen. Daniel A. Wolf will remain in office indefinitely as the state ethics commission begins to draft new regulations that could allow business owners with certain state contracts to serve in public office.
Mr. Wolf, a Democrat who represents the Cape and Islands, is the founder and part owner of Cape Air. In early summer he announced his campaign for governor. In early August he made public an opinion from the ethics commission that he could not serve as governor because Cape Air has contracts with Logan Airport, which is run by the Massachusetts Port Authority. The opinion also called into question his elected office as a state senator, and said he had a choice: divest his interest in Cape Air or resign.
Mr. Wolf later put his gubernatorial campaign on hold but petitioned the ethics commission for a rule change. Meanwhile, he was granted an extension to present his case, which he did on Thursday.
Meeting in the McCormack building in Boston, the ethics commission voted 4-1 to deny the petition from Mr. Wolf and others that called for a new regulation under the state ethics law. The five-member appointed commission instead voted to draft their own new regulations to address issues raised in the petition, with some saying that the existing state conflict of interest law does not adequately address state employees who have certain noncompetitive contracts with the state.
“I appreciate that you’ve framed the issue and brought it to our attention,” commissioner Paula Mangum said during the commission’s deliberations. “I certainly think it deserves fuller attention from us.”
It was not clear at the meeting what effect the decision would have on Mr. Wolf’s ability to retain his senate seat. But in a statement later, a spokesman for Mr. Wolf said that the commission is extending the deadline for him to stay in the state senate “indefinitely.” The statement also said that his campaign for governor remains suspended.
The petition for a proposed regulation, which was signed by Mr. Wolf and 11 others — including two former state attorneys general — asked for a regulation allowing those who have certain contracts with a state agency to run for public office provided certain conditions. The exemption would apply to those who make a full written disclosure of the relevant state contract and nature of the interest, and the individual cannot have participated as a state employee in making the contract. The contract must also apply equally to similarly situated people or entities, and all other provisions of the law would still apply.
In a presentation earlier to the commission, Carl Valvo, one of two attorneys representing Mr. Wolf and the other petitioners, emphasized that they were not arguing with the commission’s ruling about Mr. Wolf’s case.
Several commissioners questioned whether the petition would be better suited for the state legislature.
“It is not inappropriate,” Mr. Valvo said, but he added that “it’s a much more uncertain process. It takes time.”
He said the ethics commission “is uniquely situated to appreciate the problems of section seven, and maybe more importantly how best to calibrate the exemption that would apply to fixing this problem.”
The attorney continued: “There are legitimate public purposes to be served and there is a negligible conflict of interest to be tolerated if you do a regulation of the type that we are proposing.” His argument, and some of the commission’s debate, delved into details of the state ethics law and its application. Mr. Wolf has said that Cape Air’s contracts are nonnegotiable and automatically renewing.
“I got involved in this effort because we believe that the ethics laws are actually endangered when they are interpreted to be overly broad and unfair,” said Pam Wilmot, the executive director of Common Cause Massachusetts and a co-petitioner. “It reduces public confidence in the law, it reduces public confidence in you and it ultimately creates a danger that the baby can be thrown out with the bath water.”
Mr. Wolf, who was first elected senator in 2010 and is midway through his second term, said he was concerned about the state ethics law affecting those who enter public service to do good instead of those who seek to abuse their position.
He said the conflict had never occurred to him because the agreements between Cape Air and Massport are fixed and nonnegotiable and beyond his ability to influence.
“I want to be a positive force,” Mr. Wolf said. “I want the outcome to be a step forward . . . I think there’s an opportunity for all of us to do that in a very constructive way.”
Commissioner Martin Murphy said some kind of exemption might make sense. “To me an exemption that focuses on the fact there are people who need to enter into contractual relationships with the state that don’t result in getting taxpayer funds would be an appropriate subject for a ruling,” he said. “We ought to commence rule-making that addresses those particular circumstances.” He said the Cape Air contract appears to be different than other contracts that have been subject to commission proceedings.
“It seems to me that the circumstances that prompted the petition are different because the contracts that are issued here are more, from an economic perspective, in the nature of a license or a permission that the state needs to give in order for someone to run a private business,” Mr. Murphy said.
But commission chairman Charles B. Swartwood had a different view. While expressing some sympathy for Mr. Wolf’s situation, he said: “I would deny the petition, period. I feel that the statute is very clear.”
The ethics commission staff will now draft a regulation that will be subject to a public comment period and public hearings.
After the hearing, Mr. Wolf told reporters he felt the outcome was positive. In a statement released later, he said he was suspending his campaign for governor.
In the statement, Mr. Wolf said he was “heartened and encouraged” by the commission’s decision.
“My strong hope is that this process will open doors for citizens and entrepreneurs from many walks of life to enter public service without in any way diminishing our ethical standards of public conduct,” he said.
“While this process moves forward, including a period of public comment, I will continue to represent the Cape and Islands as state senator while my gubernatorial campaign remains suspended.”