Taxpayer-Funded Nondisclosure Agreements can Hide Big Problems

Post-Distpach OpEd by Nicole Galloway


A recent audit by my office found Missouri taxpayers have been on the hook for more than $115 million in legal settlements and judgments against state entities over the past six years. That includes more than $9 million paid out in cases involving allegations of workplace discrimination and sexual harassment.

For five of the six years my audit examined, the payments from the state’s Legal Expense Fund were higher than the amount budgeted by the Legislature — often by several million dollars. In fiscal year 2017, for example, the actual amount spent on litigation was more than $17 million higher than the appropriation level.

In and of itself, the amount of public money spent for legal expenses on these cases is very troubling. Those payments largely come from the state’s general revenue fund — money that could be going to essential needs, such as our K-12 schools or colleges and universities.

But the dollar figure wasn’t our only concern raised by the audit. It’s also difficult to track the true cost to taxpayers. We discovered that state officials in current and past administrations both Republican and Democratic lacked, and continue to lack, the ability to produce basic electronic reports about payments from the state’s Legal Expense Fund.

That inability makes it challenging to identify the nature of these cases, or if a state agency has had an unusually high volume of a particular type of claim against it — especially those claims that allege discrimination or harassment. A pattern of claims can be a possible sign of a toxic workplace culture, such as what came to light with the Department of Corrections in the past year both in media accounts and in subsequent legislative hearings.

Oppressive and discriminatory workplaces do not pop up overnight. With the proper tools in place, the state could be better positioned to identify problems and intervene. The current monitoring system is inadequate, and we’re shelling out millions in taxpayer dollars without a program to address root causes.

There was another, equally troubling part to my audit. Just as we’ve seen in Washington, D.C., the state of Missouri has used nondisclosure agreements (often referred to as NDAs) in some legal settlements. Nondisclosure agreements are legal tools that prevent public discussion of claims settled against the government. They also can hide long-term, festering problems — problems that often result in more lawsuits and greater costs to taxpayers.

I firmly oppose the use of NDAs in settlements by the state. These prohibitions can allow details of improper or illegal activities by government agencies to remain shrouded in secrecy — especially when coupled with the compromised legal protections for whistleblowers under a bill signed into law by Gov. Eric Greitens last year over my objections.

Legal settlements with state dollars are like any other use of public resources: Missourians have a right to know what is happening with the tax dollars they send to Jefferson City, just as state workers have a right to know what is happening in their workplaces.

The last thing citizens expect when they send hard-earned tax dollars to their government in Jefferson City is for that money to be used to pay out million-dollar lawsuits that are preventable. But the reality is that Missourians would have very little ability to know any of this if it were not for brave whistleblowers who told their stories publicly, unfettered by nondisclosure agreements.

That’s why I am supporting legislation filed in both the Senate (SB786, sponsored by Sen. Jill Schupp, D-Creve Coeur) and the House (HB1515, sponsored by Rep. Gail McCann Beatty, D-Kansas City) that protects whistleblowers and specifically prohibits NDAs as part of legal settlements by the state. The Whistleblower and Taxpayer Protection Act positions Missouri as a leader for those who speak out against fraud, public corruption and government wrongdoing — and reverses our state’s troubling trend toward secrecy.

Toxic workplace cultures, especially those found in the public workplace, should be dealt with in the light — not swept under the rug. The Missouri Legislature and Gov. Greitens can bring much-needed light to how taxpayer dollars are used by changing the law to get rid of taxpayer-funded nondisclosure agreements.