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Transportation chief sees potential conflict

Aloisi says recusals may be necessary

The governor’s office voiced confidence that James Aloisi Jr. will be able to make long-term transportation changes. The governor’s office voiced confidence that James Aloisi Jr. will be able to make long-term transportation changes.
By Noah Bierman
Globe Staff / January 22, 2009
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Governor Deval Patrick's new transportation secretary has acknowledged he may have to recuse himself from some policy decisions because of the extensive financial ties between his former law firm and the agencies he is now being asked to overhaul.

That firm, Goulston & Storrs, where James A. Aloisi Jr. was a partner, collected $2.8 million from the Massachusetts Turnpike Authority and $1.6 million from the Massachusetts Bay Transportation Authority over the past five years, Aloisi's spokesman disclosed in response to written questions from the Globe last week. Aloisi, now chairman of both agencies, declined to be interviewed yesterday.

Neither Aloisi nor his spokesman elaborated on which decisions, if any, he may have to avoid. But significant limits in his participation could jeopardize his ability to direct a complicated and controversial transportation reorganization that has become a top priority on Beacon Hill. In his new job, which he assumed last week, he is expected to lead Patrick's push to restructure and bail out the bureaucracies that run roads, tunnels, bridges, subways, buses, trains, and airports.

The potential for conflicts of interest underscores Aloisi's deep roots in the state transportation culture,as well as the advantages and disadvantages of his appointment to the top job in that realm.

Patrick's spokesman, Kyle Sullivan, said in a written statement that the administration has full confidence in Aloisi's ability to make long-term changes and that any recusals he may need to take will not impede that goal.

Aloisi's private sector career as a lawyer was focused on transportation and government work. That followed an 18-year public career in which he last served as the turnpike authority's general counsel and was credited with writing the law that set up the Big Dig's funding and operations.

Most of the state's transportation agencies are struggling financially, in large part because of debt from the Big Dig and high operating costs.

Aloisi resigned from Goulston & Storrs Jan. 12, the day he took charge of the state's vast transportation system, and he retains no financial stake in the firm, according to written responses to Globe questions by Klark Jessen, spokesman for the Executive Office of Transportation.

The state's conflict-of-interest laws place specific limits on public servants who return to the private sector, regulating the contact they may have with their former agencies. But there are fewer rules about private-sector employees moving into public life, as long as they do not retain financial interest in their former employment.

In most cases, only disclosure is required, even if they may make decisions that could affect the finances of former business partners and colleagues or projects in which their old companies are involved. Once they disclose the connection, the person who appointed them must decide whether to limit their participation. In Aloisi's case, Patrick is responsible for setting the boundaries.

Aloisi has gone from public to private and now back to the public sector and has promoted his public service background while in private practice.

His official biography, formerly posted on the Goulston & Storrs website, highlighted his experience with the Big Dig. His role in the $15 billion project and his subsequent work in the private sphere made his recent appointment a contentious one.

"People are going to say this is kind of funky," said Pamela H. Wilmot of Common Cause. "But I think there's been a public discussion of those concerns, and you're going to have that any time people are crossing these lines between government contractor to government work."

Wilmot said it is up to Patrick and his staff to pay close attention and asserted that they are "taking this matter seriously."

Jessen said in response to the Globe's questions that Aloisi is "cataloging potential matters" in which he may have to recuse himself because of potential conflicts of interest and will assess with Patrick "what future measures may be required." He speculated that there "may be matters from time to time" in which he cannot participate.

Before his appointment as secretary, Aloisi faced questions about a potential conflict of interest, as a member of a public board discussing one of Patrick's key transportation initiatives.

Last year, Patrick appointed Aloisi to the Massachusetts Port Authority board, which oversees Logan Airport, the seaport, and the Tobin Bridge. Patrick wants Massport to assume responsibility for major portions of the turnpike, as well, as the central part of a restructuring plan he announced in November.

Before he was appointed secretary, Aloisi participated in five Massport meetings during which the restructuring plan was discussed, before Massport's attorney, David Mackey, suggested that Aloisi should review whether he has a conflict of interest. Because Goulston & Storrs represented the Turnpike Authority, Aloisi could have been seen as having a financial interest in protecting its interests. The board has not voted on restructuring.

Aloisi had not previously raised the potential for conflict. Jessen told the Globe the law firm's work for the Turnpike Authority was not related to the potential merger with Massport.

"Although the firm's billings to the turnpike during the firm's last fiscal year amounted to less than 1 percent of its total revenues, out of an abundance of caution, he made a disclosure of the potential conflict" to Patrick, Jessen wrote.

Patrick's office, in a Dec. 11 letter, advised Aloisi to recuse himself from the matter.

Jessen said that because Aloisi has divested from his firm, he does not anticipate any ethical issues in discussing the merger going forward.

Noah Bierman can be reached at nbierman@globe.com.

The governor's office voiced confidence that James Aloisi Jr. will be able to make long-term transportation changes.

PATRICK BACKS APPOINTEE

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