When they met for the first time in months on November 5, members of the House Health Care Committee didn’t seem too sweet on the state’s new health insurance exchange.

Since they’d last heard from Gov. Peter Shumlin’s health care reformers in mid-September, Vermont Health Connect had experienced serious technical difficulties that prevented many individuals and small businesses from signing up. Legislators complained they’d been kept in the dark as the online marketplace’s troubles mounted.

The quote of the day came from Rep. Chris Pearson (P-Burlington), a perennial thorn in the Democratic governor’s side.

“How am I supposed to have faith in the administration moving forward when we’re asking difficult questions and perhaps getting sugarcoated answers?” he asked Department of Vermont Health Access Commissioner Mark Larson, whose office oversees the exchange.

Left unreported that day was another, less notable exchange between Larson and Rep. Mary Morrissey (R-Bennington), who asked, “Have we had any security failures in Vermont within the system?”

“We have no situations where somebody’s private information has been breached, no,” Larson responded.

When another committee member attempted to pose a question, Larson jumped back in to elaborate: “I want to be very clear. There have been concerns raised to us that we have looked into, and we have found no situation where somebody’s private information has been breached.”

Turns out that answer was sugarcoated, too.

Last Friday, a public records request filed by Associated Press reporter Dave Gram found that a Vermont Health Connect user’s private information had, in fact, found itself in someone else’s hands.

According to an incident report Larson’s department sent federal regulators three weeks prior to the hearing, an unidentified Vermonter had mysteriously received a copy of his insurance application in the mail. Handwritten on the back of the envelope was a note saying, “VERMONT HEALTH CONNECT IS NOT A SECURE WEBSITE!”

VHC privacy officer Greg Needle wrote in the incident report, “Two accounts were linked via a recycled username, and it was possible for a brief period of time that the two username holders could access the same information.” He assured the feds that this was “an isolated event” and that the underlying problem had been resolved.

But by the time Gram filed a story Friday disclosing the incident, what was once a technical problem had turned political. When House Speaker Shap Smith and other legislators reviewed a tape of the hearing over the weekend, they determined that Larson had been less than candid with the committee.

“The commissioner got it wrong,” says Rep. Mike Fisher (D-Lincoln), who chairs the committee. “He did not answer accurately the specific question put to him in the health care committee, and that’s a big deal.”

On Sunday, Larson penned a letter of apology to Fisher, which was released to reporters early Monday. In it, he said he “did not make clear that one incident of unauthorized access to private information had occurred,” and he said he regretted that his answers “have not inspired the confidence that Vermonters should expect.”

“I would like to express my sincere apology and reaffirm my commitment to providing information to your committee that is as timely and accurate as possible,” he wrote. “My omission did not reflect either your or the administration’s expectations of candor.”

Larson’s apology notwithstanding, his boss quickly took him to the woodshed.

“I take this incident extremely seriously,” Shumlin said in a statement emailed to reporters minutes after Larson’s note was circulated. “It is unacceptable to be anything less than fully cooperative and transparent with Vermonters and their elected representatives in the Legislature. I am tremendously disappointed in Commissioner Larson’s lapse of judgment in this matter.”

While perhaps over the top, Shumlin’s reaction — all five paragraphs of it — was understandable. In politics, the worst mistake you can make is to confirm through your own actions a negative assumption people have already made about you. It’s like when a suspected womanizer gets caught with his pants down.

In this case, Shumlin and his health care reform team have spent weeks dodging accusations that they’ve been less than forthcoming with legislators and the public about Vermont Health Connect’s technical problems.

For Vermont lawmakers in particular, the situation is pretty galling.

Unlike Congress or full-time legislatures in other states, Vermont’s third branch of government goes dormant for eight months every year. During that time, legislators have virtually zero power — except to hold an out-of-session hearing every now and again and hope for the best.

“All that we have is the testimony that we receive,” Fisher says. “We expect accurate information, particularly from our administration partners.”

“Your word is your bond in this place,” Speaker Smith says. “Oversight is only as effective as the willingness of the people who are testifying to answer your questions.”

When legislators convened at the Statehouse last Wednesday for a daylong briefing on budgetary matters, many privately groused about Vermont Health Connect’s rollout. But few in either chamber’s Democratic super-majority seemed eager to publicly critique the implementation of a law for which they voted, or to criticize a governor of their own party.

After Larson’s Monday disclosure, that seemed to change.

“We honestly don’t know if these are honest mistakes or attempts to mislead,” says Rep. George Till (D-Jericho), who serves on the health care committee. “I don’t mean to ascribe any intention to it, but there’s been a fair amount of unhappiness among the legislators on the committee with what’s been communicated to us as opposed to what’s happening.”

Says Rep. Paul Poirier (I-Barre), “I don’t know anyone on the committee that knows what [the administration’s] plan is. We get all our information through the media.”

Lord knows that’s a bad idea!

Sen. Ginny Lyons (D-Chittenden), who serves on the Senate Health and Welfare Committee, says she similarly feels in the dark.

“I think we’re all wanting this to succeed, but we’re also wanting to know where we are so we’re not surprised the way we have been,” she says. “I am also somewhat disappointed that the administration has made it look like everything was going fine when, in reality, there were significant problems.”

Precisely what the legislature could do differently — even if it was kept fully informed — isn’t exactly clear. And not everybody is jonesing to second-guess and micromanage the situation.

“There’s some times when you get so many people involved with something that everybody thinks they should be the person who makes the decision,” says Senate President John Campbell (D-Windsor). “I just think, at this point, our involvement isn’t going to make a difference with whether this thing is going to get up and running.”

For his part, Smith says he’s trying to strike a balance between performing oversight and allowing the people in the trenches to do their jobs.

Come January, when the legislature reconvenes, the speaker says, “I think there is going to be a real need for oversight and some hearings about how everything has unfolded this fall to see if there are lessons we can learn as to how this whole project rolled out. Because clearly this has not gone how anyone would have drawn it up.”

That will likely involve, he says, a close look at state government’s perennial inability to pull off complicated information technology projects on time and on budget.

As for the leadership of Vermont Health Connect, Shumlin made clear at a Monday press conference that he has no plans to replace Larson.

The commissioner himself dutifully made the media rounds Monday and Tuesday, repeatedly apologizing for his omission and explaining that, in answering Morrissey’s question, he was distinguishing between an external “security breach” and an internal “privacy issue.”

“I was attempting to be responsive to the issue,” Larson says. “I should have made the connection between this incident and the question that was asked. I made the mistake of not doing that. It was clearly my mistake.”

Even among legislators most miffed about the incident, many still expressed confidence in Larson. A former state representative himself, Larson preceded Fisher as chairman of the House Health Care Committee, where he established a reputation as a straight shooter.

“The reality is that Mark has a reservoir of good will,” Smith says. “And if people believe that it is an isolated incident and that he understands that people take it very seriously, I think he can rebuild people’s confidence.”

“He’s always been aboveboard,” Campbell echoes. “He’s a guy who I don’t think anyone would say a bad word about. He made a mistake. There’s no question about it. But God forbid anyone think he’s human.”

And God forbid a politician sugarcoat the truth. Perhaps Larson learned that from the boss.

Lobbying for Lobbyists

Last week the city of Burlington replaced its two longtime lobbyists with one of Montpelier’s biggest lobbying firms.

“What’s that?” you ask. “Burlington hires lobbyists?”

Indeed. And it has for decades.

For the past 11 years, the city has been represented in Montpelier by a pair of recovering Burlington pols: former city councilor Erhard Mahnke, a Progressive, and former state representative Karen Moran Lafayette, a Democrat. Mahnke also serves as executive director of the Vermont Affordable Housing Coalition, while Lafayette lobbies for the Vermont Low Income Advocacy Council.

But last week, at the conclusion of the city’s annual competitive bid process, Mayor Miro Weinberger inked a new, $30,000 contract with KSE Partners. That’s slightly more than the $28,000 the city paid Mahnke and Lafayette last year, but less than the $32,000 it paid them the year before.

KSE is a Big Kahuna down Montpelier way. According to filings with the secretary of state, the firm brought in more lobbying dough last year than any other in the state. Its clients include Green Mountain Power, AT&T, Hewlett-Packard, VISA and Blue Cross Blue Shield of Vermont.

It also has a history of representing Burlington: Back in the 1990s, the firm served as the city’s lobbyist.

“It wasn’t a decision we came to lightly,” Weinberger says of the switch, citing the “good work” Mahnke and Lafayette have done for Burlington. “Really what it came down to was KSE has a larger Statehouse team.”

Not everyone in town agrees with the decision.

After city attorney Eileen Blackwood informed Burlington’s legislative delegation of the move, several voiced their disappointment via email.

“I don’t know if it will be a strategic error or not, but I do think that you may be gaining a slicker, better-endowed firm, but you are losing true, knowledgeable, experienced, long-term Burlington politicians/activists,” Rep. Curt McCormack (D-Burlington) wrote Weinberger Monday. “This is what they are ‘well respected’ for.”

“I have expressed my disappointment to the mayor and Eileen last week,” Rep. Joey Donovan (D-Burlington) wrote Tuesday. “I asked about process and if any reps had been consulted. Unsatisfactory response. So, next steps?”

The mayor replied later that day, outlining his reasons for switching to KSE and reiterating that the contract was for one year only.

“In the end, my decision to make a change came down to the basic and important issue of capacity — the City had the opportunity to more than double the size of its legislative liaison team for nearly the same price,” Weinberger wrote. “I am confident that my decision to make a change was in the best interests of the Burlington taxpayers.”