12 Reasons the State Bar of Arizona is Non-transparent.*

1. It fails to tell its members where their money goes. The Bar does not provide members a detailed accounting of its annual expenditures, let alone a yearly income statement and balance sheet. In addition, the Bar uses unexplained indirect cost allocations to account for overhead and administrative costs. Moreover, these partial allocations appear to be based on undocumented time estimates unrelated to measurable factors. Indeed, in the Bar’s “2015 Annual Report,” the Bar states that in 2015 it generated CLE revenues of $2,059,801 against expenses of $1,925,940. This translates into a mystifying expense-to-sales ratio of approximately 94%. Were these allocated expenses reasonably linked to a level of service or benefit received? Without transparency, it’s anybody’s guess whether the Bar’s indirect cost allocations are reasonable, equitable, real and current — or whether they even represent acceptable means for apportioning costs;

                       As clear as mud.

2. It fails to disclose how much it spends on lawyer regulation and how much it spends on non-regulation. Of the approximate one-third of its annual budget spent on lawyer regulation and discipline, the Bar provides no expense detail, particularly about the number of discipline-related professional staff or how much they are paid;

3. It fails to disclose how much it spends annually on political and ideological activities, including bar relations related to promoting the interests of special interest lawyers; support services for voluntary, politically active bar associations; public relations and advocacy activities in support of merit selection; administrative and financial support of social programs having ideological content as well as political advocacy Bar leadership training; lobbying and expenses paid of the Board of Governors and other administrative expenses for carrying out the Bar’s political and ideological activities as well as all expense reimbursements and funds paid to outside contracted lobbyists. Also undisclosed are the actual work hours expended lobbying and giving lawmaking advice to the Legislature by its two executive employees who are also state-registered lobbyists: the Bar’s CEO/Executive Director and the Bar’s Chief Communications Officer;

4. It fails to timely and completely disclose the annual compensation paid to all management, including all top executives – – not just “key employees” as defined and required under IRS Form 990 “reportable compensation” mandates;

5. It fails to widely, and prospectively disclose periodic Supreme Court Rules Petitions it files and which often increase member disciplinary exposure or otherwise adversely affect their interests, including, for example, recent ethical rule requirements for succession planning and more recently, a Petition to Amend the Oath of Admission to the Bar & Lawyer’s Creed of Professionalism;

6. It fails to disclose to lawyer participants beforehand, its ‘unwritten’ voluntary Fee Arbitration Program “50% rule.” The Fee Arbitration Program is designed to resolve fee disputes between Arizona attorneys and their clients. But under the “50% rule,” if the fee arbitrator awards more than 50% of the fees returned to the client, the award is automatically referred to the Lawyer Regulation Office for lawyer disciplinary investigation. This rule is not found anywhere in the Rules of Arbitration of Fee Disputes or is it publicly divulged to members. The rule is instead invoked in practice and as an unwelcome ‘surprise’ if the parties do not settle;

7. It fails to detail its longstanding nonperformance in committing, measuring, recruiting, training, and managing organizational workplace race, ethnicity, gender and disabilities diversity within its own employee organization, especially the historic lack of race and ethnic diversity among top management;

8. It fails to disclose the number of outside consultants and contractors it hires; how they are hired; and how much each is paid. The Bar does not make those consulting and independent contractor agreements available for public inspection;

9. It fails to adequately explain and disclose its internal process and ‘carefully tailored’ procedures to determine itself “Keller-pure,” including activities it engages in unrelated to its core functions of regulating the legal profession to improve the quality of legal services;

10. It fails to disclose in any detail its formula for benchmarking executive compensation and organizational size, operations and service. Not long ago, Arizona was No. 1 among mandatory bars with a member-to-professional staff ratio of 158 to 1;

11. It fails to disclose and identify the financial contributions, including gifts-in-kind, made with mandatory member assessments and which are annually disbursed to various special interest voluntary bar associations;

12. It fails to make open and available its member-funded channels of communication to give fair and equal time to opposing arguments and viewpoints on controversial issues and concerns like the merits of a voluntary state bar. Instead it repeatedly mischaracterizes and misrepresents the views of voluntary bar proponents.

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* Obviously, there are more than 12 including the Bar’s machinations to pass its last mandatory dues increase and its continued conflation without empirical proofs of enhanced lawyer competencies through its Bar-sponsored continuing legal education programs — but for now, these are a modest start.