Have you enjoyed your service in the Utah Legislature?
It has been a wonderful experience and certainly an honor and a privilege to represent the citizens of southern Utah County. I am humbled as I considered the confidence that has been placed in me by my constitutents.
How long do you spend in session each year?
The legislative session lasts 45 days from mid-January to the first part of March. However, that certainly does not constitute the total amount of time spent throughout the year. I estimate I spend a day or two a week with legislative work. I spend one day each month in interim committees. I serve on numerous committees and work groups which take additional time. Considering and discussing potential bills consumes even more time. I also enjoy visiting with my constituents and recognizing them for their accomplishments, responding to emails, researching issues, and being involved in community events. This is a great area of the state and our citizens deserve a great deal of credit for that.
Do you have much interaction with your constituents?
I have been amazed over the pasts few years the response I have received to surveys, letters and newspaper articles. I also receive numerous phone calls dealing with issues from agriculture to education to transportation to family concerns. It is always rewarding to be able to help my constituents through a somewhat bureaucratic system and get resolution to their problems and concerns.
How long do you plan on serving in the legislature?
I haven’t put a timeline on my service, but I plan to serve for as long as I have the energy and time to be effective and continue to earn the trust and support of my constituents. However, I have never wanted to be a lifelong politician. Over the past six years, I have gained some tenure and seniority and have numerous leadership responsibilities which allows me to have more influence as I serve my constituents in southern Utah County. The added clout helps to accomplish important goals for our citizens and communities.
What are some issues our state will face over your next term?
Healthcare reform is critical and will be debated at length over the next few years. The legislature created a task force to provide meaningful input for this issue. HB9 which I sponsored and was passed last session created a method for transparency and the introduction of market forces into healthcare. It was funded this session and is a key component in the task force. I plan to take an active role in guiding this to a market-driven system rather than a socialistic model.
As the economy slows to some extent, funding for education and roads which are critical to Utah County will continue to be important issues. I will continue to advocate for prioritization of funds based on needs rather than simply increasing taxes.
Supporting law enforcement and corrections must be a priority with the increase in violent crimes, gangs, sexual predators, domestic violence, and drug abuse.
Strengthening families, decreasing government bureaucracy and financial accountability continue to be my key concerns which I will continue to defend
NEBO SCHOOL DISTRICT
Do you fully support district schools and particularly Nebo School District?
I have always loved the Nebo School District. My wife and I both attended school in the Nebo School District, as have several of our children. My father taught school for many years and my father-in-law is a retired teacher of 30 years so I have a soft spot for our public educators. I have fought for equalization in the capital outlay fund, bringing millions of dollars in additional revenue to Nebo School District. I have made donations for many years to the Nebo Foundation, to athletic teams, and have donated construction services to the high school. I am pro-education. It is my belief that parents are responsible for the education of their children and I recognize public education’s role in assisting parents to that end. As the educator of choice for approximately 97% of our state’s children, district schools must be strong, vibrant, and receive adequate support. Our state is absolute committed to education, constitutionally dedicating 100% of income tax, both personal and corporate, to education.
It was alleged that you missed a key vote on a charter school funding bill which, if passed, required the districts to provide part of the property tax base for charter school students.
It’s interesting that I’m criticized whether I vote for or against any charter school issue and now even if I am not present for the vote. During that particular vote, I was visiting with a group of high school student from Nebo School District who had arranged a visit to the Capitol several days previous. I spoke with them for about 15 minutes in a committee room about state government.
What happens in situations where votes are taking place when members are off the floor?
Given that a legislator is responsible to shepherd their bill through the House and the Senate and that constituents often come to the Capitol and require some attention, legislators are occasionally off the floor. In reality, it is rare for every member of the House to vote on any bill. When debate on a particular bill has ended and the vote is open, a chime sounds outside the House chambers. That chime cannot be heard in the committee rooms.
In situations when the vote on a bill is close enough that the votes of the members who are not on the floor could make the difference one way or another, a motion can be made for a Call of the House requiring every member of the House to be located and to vote which is what took place with regard to the bill mentioned above. I was located in the committee room as I was finishing up and hurried to the floor. Just before I arrived, the Call was lifted meaning there were enough votes cast to make a final determination. The bill failed to pass. Although the vote was closed before I was able to cast my “No” vote, it would not have made a difference in the outcome.
Prior to the bill being brought to the floor, I worked with many representatives in order to bring about a much-needed shift in the Capital Outlay Funding Formula using my known opposition as leverage to benefit Nebo School District to the tune of about $3 million. The net loss from property tax was about $600,000, bringing a net gain to the district of just under $2.5 million. I believe this fair given that Nebo School District has one of the highest assessments on property taxes in the state due to the bonding that has taken place to build recent schools.
It is interesting that no recognition is ever given of the net gain in funding to the district. Only the negative side of the equation is discussed. It must be understood that the overall budget for Nebo School District for the 2008-2009 school year is over $155 million. Of that, just over 14% or $22 million came from property tax assessments. The $600,000 that was reallocated to charter schools represents only .3% of the total district budget. The $3 million increase coming from the change in the Capital Outlay Formula was far more significant.
What do you think can be done to help with property taxes statewide if our area is the most highly taxed?
I believe it is time for a state-wide equalization of property taxes which would benefit Nebo School District and our area considerably and would be a more equitable way to deal with funding of district facility needs.
Your opponent has repeatedly said you are difficult to reach and unresponsive to requests to discuss issues and meet with the school board.
With all due respect to my opponent, that is simply not true. I do no know of a single instance where I have failed to respond to an email, return a call, or schedule a meeting. I may not always have been available on the date suggested, but I have always provided alternate days and times. I have met repeatedly with Mrs. Swenson at the school district office, in my office, and at the Capitol. I have also been completely available to Superintendent Chris Sorenson and other district personnel. I share an email I received from Mrs. Swenson last fall regarding just such a meeting, “Nedra, I'm giving up on a day when legislators can come. Mike is the only one who seems willing or able. Maybe we are going to have to consider an evening meeting sometime to meet with them. Could we set up a meeting for Mike on one of these mornings, perhaps to see a literacy block and maybe Oakridge? He seems willing and I want to have him see what's happening. Let me know. Debbie”
MEDIA
You certainly have received a lot of media attention this year. Why is that?
I have never done anything halfway and I tackle a heavy load of conservative issues which don't often play well with the liberal media. In the vast majority of articles which have been published, it is apparent little research has been done because the articles completely misrepresent the intent and text of the legislation. I find it interesting that often my position is given despite the fact I have never been contacted for comment. My colleagues and I have often joked that the media does not let the facts get in the way of a good story.
My first involvement with the media was in my first committee meeting as a legislator. Issues regarding balancing the budget in an Education Interim Committee meeting were discussed. Driving home, I listed to reports on the radio and wondered if the reporter and I had even been in the same meeting.
Couldn't you do more to stay out of media?
I guess I could if I did nothing. As long I serve, I plan to advocate for good public policy which means promoting conservative principles and as long as I am actively involved in those kinds of issues I will likely be the target of media attention.
CONFLICT OF INTEREST
Do you have any conflicts of interest with your service in the legislature?
Utah has a lay legislature meaning we are only in session for a short time and most have full-time employment elsewhere. Every member of the legislature will face a conflict of interest when considering and voting on legislation. That is why we are required to file a disclosure form. It has been reported that I have the most comprehensive disclosure statement of any member of the House.
How do you feel about a lay legislature?
I believe it is an excellent form of governance. Having a full-time legislature would be cost prohibitive and would result in many more laws and regulations. Further, it allows people who, in a very real sense, are subject to the laws they pass to have input in the system.
What percentage of the bills you sponsor deal directly with your employment?
A very small percentage. This past year, I ran 14 bills. Two were land use bills and one was a workers compensation bill, none of which have any direct impact on me or my company. A fourth, HB184 Construction Amendments, adds transparency in the construction industry by creating a uniform building permit system.
As a developer, land use would seem to be a direct tie.
I certainly have knowledge of land use issues and am familiar with the system. However, HB153 and HB177 were discussed and crafted during a series of meetings in the interim with the Property Rights Coalition and the League of Cities and Towns. They are sound policy, but constitute no direct benefit to me personally.
Were you able to reach consensus?
Yes. As a matter of fact, both organizations encouraged support of these bills and listed them as high-priority, must-pass bills. I also received a letter from the League thanking me for my approach in handling these delicate land use matters.
Why is land use so important to you?
I believe our right to property is guaranteed by the constitution and is critical to the freedoms we as Americans enjoy. Property ownership is a key component in the stability of families.
What is your relationship to Wendell Gibby?
Due to my involvement in property rights issues, Wendell contacted me a couple of years ago about a concern he had with zoning of property he owns. After thoroughly researching the zoning issues involved, it became evident that the environmentally sensitive zoning was inappropriately applied to his property. Upon visiting with city leaders and being told they had purposely zoned his property to prohibit development and protect views, it was evident this was a violation of personal property rights. As I worked further on this issue, I became aware this was not an isolated instance. This issue was discussed during the interim last year with active involvement from League of Cities and Towns and the Utah Property Rights Coalition. We received good, thoughtful input which helped us craft legislation that focused the zoning of environmentally sensitive areas on science and fact rather than emotion. The result of these meetings was HB177 which I have discussed above. Mr. Gibby did not attend any meetings and was not consulted about the language of the bill. After the bill had been drafted, Mr. Gibby contacted me and asked that I make some modifications. I reviewed his suggestions, but indicated I had worked in good faith with the League and the UPRC and that I would hold firm on our findings. I suggested that he find another sponsor to deal with his specific issues. I have no professional relationship with Wendell Gibby. He has never donated to my campaign. I have nothing to gain from my work with Wendell. To the contrary, I have had considerable criticism of my efforts in that regard.
Is it true the League of Cities and Towns asked you to act as an intermediary between Mapleton City and Wendell Gibby?
Yes. I was reticent to do so, but both the city and Mr. Gibby felt it might be productive and help settle a long-standing dispute between the parties. The parties came to a written agreement.
What about an email sent by you to Mr. Gibby wherein you purportedly said that you would "hammer them"?
I don't remember the email. I do remember that after arriving at an agreement with the city, there was considerable mistrust on the part of Mr. Gibby toward the city and he contacted me on a couple of occasions concerned that they would not honor the agreement. Making that type of statement would only be an indication that if the city did not honor the written agreement, there would obviously be legal consequences.
CHARTER SCHOOLS
Explain your involvement with charter schools.
I have been involved in the construction and development of several charter schools in Utah and Colorado. It is important to understand some things about the charter school movement and my professional involvement:
1. I have never run any charter school legislation. Charter schools were created and the funding established in the 1990's, long before my tenure in the legislature.
2. I have been involved in real estate investment and creating lease-back facilities for nearly 20 years including facilities for federal (BLM and USDA) and state agencies (Dept. of Workforce Services, Dept. of Human Sevice, Dept. of Motor Vehicles) and private tenants (Napa, Family Dollar and others) so I understand the process and risks associated with creating lease facilities.
3. As a contractor, we were hired to build a charter school in the Draper area. Upon successful completion of the school in 78 days which was certainly a feat, we were asked to join in the development and construction of some other schools.
Charter schools are public schools. They do not charge tuition like private schools, but rather are funded through the same funding stream as district schools for the students attending with one notable exception: they have no taxing or bonding authority. Nebo School District currently collects approximately 81% of property tax to build physical facilities in our area which is the third highest assessment in the state, primarily due to our rapid growth rate. Charter schools, on the other hand, get a per-pupil allocation to cover facilities costs. Charter schools have to look to private sources of capital or lease facilities in order to fill their physical facilities requirement. A chartering organization, once granted a charter, is then tasked with the responsibility of providing facilities. That need can be filled either by finding an existing building and having it remodeled or by finding a developer willing to build a new school facility and lease it back to the school.
The interesting thing about charter schools is that because they are a school of parental choice there is no guaranteed student population nor are there any state guarantees. Around the country and even in our area, there have been failures. Because the chartering organizations are typically made up of parents with limited resources who are unwilling or unable to sign personally or post collateral, there is no guarantee. Banks traditionally have looked at these loans as very risky and require a substantial amount of equity and investors must post a considerable amount of risk capital in order to qualify for financing. With no state guarantees and no personal guarantees, these are high-risk investments.
Why would anyone be willing to take that risk?
I believe in choice in education for parents. In Utah, charter schools have generally had favorable acceptance and a certain number of parents have been attracted to the charter school model.
What is that model?
The legislation created a laboratory of innovation with several express purposes:
· Continue to improve student learning.
· Encourage the use of different and innovative teaching methods.
· Create new professional opportunities for educators.
· Increase choice of learning opportunities for students.
· Establish new models of public schools and new forms of accountability.
· Provide opportunities for greater parental involvement.
· Expand school choice.
Has your work in the legislature give you an advantage over others who may have interest in the development and construction of charter schools?
No. In fact, the media attention I have received has had quite the opposite effect.
Some have alleged that your wife's involvement as a board member was instrumental in your obtaining the contract on ALA.
Because of her involvement, the board hired a law firm to consult them on, among other things, the procurement and due process. In every case where facilities were discussed and decisions were made, she was asked to recuse herself and leave the meeting.
Were procurement policies follows?
I was never involved in any of the board meetings or discussions by the board meetings of ALA, but they were advised by counsel to thoroughly investigate all options available to them and make the best decision possible for the school. The decisions regarding facilities were delayed for several weeks to facilitate that process. I was assured that they had complied with appropriate policies.
Some have indicated that you have been highly compensated for your work with charter schools.
First, let me indicate that my involvement in the local charter schools was limited. I owned approximately 16% so I was not a majority owner, nor was I the managing partner and had very little involvement in the facilities negotiations. We did earn a market return for our efforts. Interestingly, had our group of investors simply purchased property, held it undeveloped, and then sold it at the time the school secured financing, the profit margin would likely have been higher due solely to the escalation in property values.
We have assisted a number of the charter schools we helped develop secure long-term bond financing which has allowed them to purchase their facilities at a significant savings over what would have been paid in a long-term lease.
Would it have been more profitable for your group to maintain ownership of the buildings and continue to collect lease payments?
Undoubtedly. However, I believe in promoting choice through charter schools, not as a replacement of district schools but as a supplement to them. Charter schools are most successful when they control their own facilities.
Ethics rules required disclosure. Has your involvement in charter schools been fully disclosed?
Yes. I have always fully disclosed my involvement in charter schools and other real estate investments.
Prior to our involvement, few charter schools were able to find adequate facilities and the Utah market was under-served by charter schools in comparison to all the surrounding states. However, charter schools have proliferated in recent years providing, for the most part, an excellent education and additional parental choice. I believe charter schools fill a need. They will never replace district schools, nor were they ever intended to, but certainly there are those who benefit from their existence and, as such, the whole educational system is better because of the availability of choice.
Describe the situation with the roof leaks at charter schools.
This issue deals with two separate schools, one in Pleasant Grove and one in Salt Lake City. With the first, the roof leaks were not widespread or significant. There were roof penetrations in different areas of the building that had not been properly sealed by a subcontractor, but have since been repaired. The roofing subcontractor is carrying a warranty on this roof. Regarding the second school in Salt Lake City, this was an existing roof on a remodeled building where the roof was not replaced and was thought to be in good condition. We have since worked tirelessly to resolve the problems, although this was somewhat hampered during the winter by snow on the roof.
HB407 COMMUNITY CONSCIOUS INTERNET PROVIDER
Did this bill pass?
No. By the time the bill was drafted and out for review, it was late in the session. It had some fiscal impact and because of the reduced revenue projections, it was not prioritized. I plan to work on this issue through the interim to see if there are ways to encourage more providers to become involved in this type of self-monitoring program.
What would the bill do?
The bill, with language provided by an internet pornography task force, would create a seal of approval which could be used by internet providers who voluntarily agreed to restrict pornographic websites. If they became aware of a pornographic site, they agreed to immediately remove it from service or pay a fine. The bill also establishes no-tolerance policies which must be signed and agreed to by every client.
Is it true there was opposition from some of the larger providers?
There was complaint that they would be disadvantaged by other providers who met the requirements and were able to display the seal. That’s the point of the legislation – to give parents an opportunity to see those who are committed to an anti-pornography agenda and to favor them as an IP provider.
The legislation indicated that if an IP provider continued to display the family friendly seal, yet refused to shut down a pornographic site once it had been brought to their attention, there would be fines or disciplinary action. It was explained to me that they were not willing to submit to fines or to monitor their clients. This is a voluntary program. The fines and penalties apply only to those who agree to the conditions required to display the seal. I have never been in favor of government mandates. Because of constitutional implications for any kind of mandatory monitoring of pornographic content, we are attempting to create a voluntary program that would provide a marketing tool for those who are willing to comply. We have to do something about pornography.
Has this approach been tried elsewhere?
There are several other states including Arizona, California, Illinois, Hawaii, Indiana, and Idaho which are promoting various forms of this legislation.
Click here to view more about this topic.
SEC
Are you named in a criminal investigation?
No. Firstly, the suit by the SEC is a civil suit, not a criminal suit. Secondly, there is absolutely no allegation of impropriety on my part . I am not suspected of or being investigated for wrongdoing. My attorney, Doug Griffith of Kesler & Rust indicates,
Mike Morley has not been the target of, suspected of, or investigated for any misconduct or wrong-doing in connection with a criminal investigation by the SEC or any other government agency. Any allegations to the contrary are misinformed or display a lack of understanding of legal pleadings.
Tom Melton of the SEC has said,
I've no reason, no knowledge, no evidence to believe Morley or his wife knew that the money [may have been] misappropriated. That's why they're named as relief defendants in the case.
What is a relief defendant?
A party who may have received money to which they were not entitled, money which may have been wrongfully appropriated. All of the accounts under Thompson's management were listed as relief defendants in the case along with me. The only reasons we are listed as relief defendants are 1) the timing of withdrawals in relation to the eventual demise of the accounts and/or 2) the SEC has yet to fully investigate the facts. We have not spoken to the SEC or presented our documents which clearly show the withdrawal in question is completely appropriate. My attorney is confident that once he has the opportunity to present the facts, we will be dropped as a relief defendant in this case.
What is your involvement in the issue being investigated by the SEC?
In 2004, at the encouragement of my attorney who is also a very distant cousin, I invested considerable funds with a brokerage firm in Salt Lake City which had been in business for 20 years and had a track record of successful investing. The account where my investment funds were placed was touted as a capital-preservation fund and was managed by the brokerage. I had no control over this account, was not involved in trading, had no management or signing authority. The extent of my involvement was to make periodic deposits and to occasionally request withdrawal of my funds. In May 2007, I drew on part of the account to make a land investment, leaving the majority of the funds in the account. Approximately three months later, the account was completely wiped out due to questionable trading practices on the part of the investment firm. All of my remaining funds which were significant were wiped out. This was devastating to me and the other investors.
During the last day or two of the session, I got a call from a reporter indicating I had been named as a relief defendant in a civil law suit filed by the SEC regarding that account. I was understandably upset and when I began to show concern, the reporter quickly assured me that there was no allegation of impropriety or wrongdoing against me. They were simply investigating transfers between accounts by the firm’s principals. The question the SEC is looking to resolve in this case has nothing to do with me or my actions, but whether the brokerage did something inappropriate.
Based on this conversation, I was not happy when the article intimated that I had somehow been more involved and was protected from any losses while others lost everything. That is simply not the case. I would dare speculate that there are likely few if any who lost more than I.
It has been stated that your cousin’s involvement in the company gave you advantages that other investors did not have such as being able to withdraw money just prior to the collapse of the account.
That is simply not true. My cousin, who served as legal council for the investment firm, but did not manage any of the accounts or become involved in any trades, was out of town on vacation during the time the accounts were wiped out. My most current withdrawal was more than three months prior to the collapse. Could anyone really believe that I knew the company was going down and chose to leave my money in the fund where everything was lost? The mismanagement of the fund, loans between accounts, and possible co-mingling of accounts was done to the detriment of me and every other investor which is why the manager is the subject of the SEC investigation. If the accusations were true, I would be the subject of a criminal investigation. I’m not. Quite to the contrary, I arguably lost more than most who invested in the fund and when it did go down, I lost every cent in the account.
HB384 EMPLOYEE OBLIGATIONS RELATED TO WORKERS’ COMPENSATION
You mentioned you had run a workers compensation bill.
Yes. I was approached by the Utah Retail Grocer’s Association with a concern about a Utah Supreme Court case wherein “King” had been injured at his place of employment. Following rehabilitation, King could not return to work due to the fact that he was incarcerated for a felony and could not return to work. The Court held that wage replacement benefits must continued until full employment could occur regardless of his incarceration. Based on this case, the Labor Commission awarded ongoing benefit to employees who were terminated with cause for other illegal activities such as theft, drug abuse, etc.
How does your bill resolve this problem?
After nearly a year of collaborative effort by legislators, the Utah Trial Lawyers Association, Workers’ Compensation Fund and other workers compensation carriers, the Utah Labor Commission and their advisory council, the Utah Retail Grocers’ Association and the food industry, a bill was crafted to allow for a judicial determination for the cessation of compensation benefits if a person could not return to work due to incarceration and/or termination due to illegal activities which would prohibit employment. Under this legislation, medical benefits would continue indefinitely as per existing law.
It has been alleged that you ran this bill as a way to benefit your business, that as a contractor you could use it as justification for hiring illegal aliens, only to deny them workers compensation benefits once they were hurt. Is that true?
No. There is absolutely no basis in fact for that allegation. I want to emphatically state that I do not hire illegal aliens. We thoroughly check all records and confirm authenticity with a social security verification database. I can confidently state that M-13 Construction does not employ any illegal aliens.
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