The $280 Million Attorneys General Fund

NAAG is a bipartisan forum for all state and territory

AGs,

or at least it’s supposed to be. But we reported in July on the legitimate concerns expressed by eight GOP state AGs, led by Kentucky’s

Daniel Cameron,

about the way NAAG itself is benefiting from tort settlements. The AGs worried that NAAG is becoming a litigation machine in its own right, with an agenda more in tune with the tort bar than with the states AGs represent.

The Republicans in Colorado will discuss how to press the issue with their Democratic colleagues. This will include debating a draft letter that Mr. Cameron and Utah Attorney General

Sean Reyes

have put together to send to Iowa AG

Tom Miller,

the current NAAG president and a Democrat.

“NAAG boasts more than $280 million in total assets. The association’s annual operating budget is about $5.1 million,” says the draft letter. “While NAAG should continue to maintain a reasonable operating budget to meet its mission, we do not understand how that mission requires that NAAG retain over $280 million in assets and the associated income from those assets.” The draft goes on to ask if “NAAG is willing to return the bulk of these assets to the States.”

This is about accountability as much as the money. Most of NAAG’s windfall comes from lawsuits brought by the states but the money isn’t subject to state political oversight or legislative approval. No one elected the NAAG officials who invest the money or decide to pass it out in loans or grants, or to finance new litigation against business.

For a flavor of NAAG’s priorities, here’s how its website lists its agenda for its Eastern Region meeting in Portland, Maine, on Sept. 7-8: “topics will include a look at sea-level rise and preparedness and the impact of climate change on ecosystems and particular industries; a review of current solar and wind power developments and related opportunities, challenges, and promising practices; how social equity should factor in attorney general offices’ leadership and advocacy on optimizing climate resilience,” and more.

Too many Republican AGs have been napping while NAAG became essentially a business partner with the plaintiffs bar on behalf of progressive causes. Tort firms and NAAG work together with certain state AGs on litigation themes and targets. The firms get their usual contingency fee, and NAAG gets a cut. This looks like a political racket.

Republican AGs have a chance to blow the whistle on all this, and if that doesn’t work they can leave and stop lending their credibility to a partisan litigation shop. The first test will be what happens to that $280 million.