CEO 07-17 -- August 1, 2007

VOTING CONFLICT OF INTEREST

TOWN COUNCIL MEMBER VOTING ON LAND USE MATTERS

To: Jerome F. Skrandel, (Attorney for the Town of Briny Breezes)

SUMMARY:

No voting conflict of interest would be created under Section 112.3143(3)(a), Florida Statutes, were a member of the Briny Breezes Town Council to vote on land use matters where she is a shareholder in the corporation which owns the land affected by the vote and owns a home located in the affected area. Under the circumstances, each of the Town's residents is affected in a proportionally equal manner, and there is therefore no "special private" gain or loss to the Council member as a result of the votes.


QUESTION:

Would a voting conflict of interest exist were a member of the Briny Breezes Town Council to vote on an amendment to the Town's Comprehensive Plan, the Evaluation and Appraisal Report supporting the amendment, amendments to the Town's land development regulations, rezoning of single family residential areas to higher residential densities and commercial resort purposes, and approval of a master plan of development for the proposed redevelopment of property, where the Council member's home is located within the proposed redevelopment area, and the Council member is a shareholder in the corporation which owns the land affected by the votes?


Your question is answered in the negative, under the particular circumstances provided.


You write on behalf of Sharon Kendrigan, a member of the Town Council of the Town of Briny Breezes, to request guidance as to whether the member may vote on matters related to redevelopment of the Town and the merger and sale of the corporation which owns the bulk of the land on which the Town is situated to a development corporation.


Information contained in your letter, telephone conversations, and other correspondence between you and our staff reflects that Briny Breezes is a town of approximately 47 acres bounded by the Atlantic Ocean on the east and the Intra-Coastal Waterway on the west. It is fully developed as a residential mobile home community, operated by a single property owner, Briny Breezes, Inc. The population of the Town, you advise, is 412 persons, swelling to 900-1,000 persons in winter. You indicate that owner occupancy is prevalent, with only two or three renters. You relate that the Town has 383 registered voters.


You write that Briny Breezes, Inc., is registered as a residential cooperative under Chapter 719, Florida Statutes. Each owner has a long term lease for a term of 99 years, and each is given a stock certificate for one or more voting shares in the corporation. You relate that there are 15,703 outstanding shares. The allocation of these shares, you advise, was arrived at in 1960 when the corporation was formed, and is based on the size and location of the mobile home site in the 488-site community.[1]


You write that in 2006 the shareholders of Briny Breezes, Inc., authorized the corporation's board of directors[2] to issue a request for proposals to developers interested in purchasing the corporation's assets, the most significant of which is the tract of land upon which the Town lies. In January of this year the shareholders approved, by an 82% majority, a sale and merger agreement under which the shareholders will be paid on the basis of the number of shares held.


Closing is expected in 2009, and the Town has initiated the process of amending its Comprehensive Plan in order to facilitate the Town's planned redevelopment. The Council has already voted to amend to the Town's Comprehensive Plan and adopt the Evaluation and Appraisal Report in support of the proposed redevelopment concepts. It is anticipated that measures which will be considered in anticipation of the redevelopment include the adoption of new land development regulations, rezoning of property to higher residential densities and commercial resort purposes, and approval of a master plan for the proposed redevelopment. You inquire whether the Council member may vote, given that she stands to gain or lose as a result of the merger and sale.


Section 112.3143(3)(a), Florida Statutes, states, in relevant part:


VOTING CONFLICTS.--No county, municipal, or other local public officer shall vote in an official capacity upon any measure which inures to his or her special private gain or loss; which he or she knows would inure to the special private gain or loss of any principal by whom the officer is retained or to the parent organization or subsidiary of a corporate principal by which he or she is retained, other than an agency as defined in s. 112.312(2); or which he or she knows would inure to the special private gain or loss of a relative or business associate of the public 1officer. Such public officer shall, prior to the vote being taken, publicly state to the assembly the nature of the officer's interest in the matter from which he or she is abstaining from voting and, within 15 days after the vote occurs, disclose the nature of his or her interest as a public record in a memorandum filed with the person responsible for recording the minutes of the meeting, who shall incorporate the memorandum in the minutes.


This provision prohibits an official from voting whenever the matter under consideration would work to his own special gain or loss, or that of a relative, employer, principal, or business associate.

The Council member clearly has an interest in the course of development of the corporation property, but the Code of Ethics does not prohibit every vote that inures to the benefit of a public officer; only those that inure to his or her "special" private gain. In a number of opinions, we have found that no voting conflict exists when the officer is a member of a large class whose members will be similarly affected.


Typically, a "size of the class" analysis involves a review of the impact on the voting official of the matter being voted on relative to its impact on all persons or entities affected. The test recognizes that "where the class of persons is large, a special gain will result only if there are circumstances unique to the officer or principal under which he stands to gain more than the other members of the class." CEO 77-129.


The test also has applicability in situations where the class of persons similarly affected, while small, constitutes the entire population. For example, in CEO 87-27, we found that town council members were not prohibited by Section 112.3143 from voting to rezone all of the single-family residential property within the town to commercial property in order to sell the property to a single purchaser, where the council members were homeowners in the town. The opinion recognized that while the council members would receive a distribution from any sale, the rezoning would affect all of the residents of the town, who would be compensated based on an equitable formula. Similarly, in a series of complaints filed against officials of the Town of Weeki Wachee,[3] we found no probable cause to believe a violation of Section 112.3143 had occurred when members of the town council who had contractual relationships with the attraction voted to accept the attraction as a donation, where all eight persons living in the town either were employed by the attraction or lived in housing rented from or provided by the attraction. Finally, in CEO 06-21, we found that no voting conflict of interest would be created under Section 112.3143(3)(a), Florida Statutes, were a member of the Marineland Town Commission to vote on land use matters where the applicant purchased the land in question from the member's employer, who had extensive contractual relationships with the applicant and planned to engage in development in the town complementary to that of the applicant, where the vote would affect each of the town's six residents in the same way.


As in the cases cited, the anticipated votes here will impact virtually all of Briny Breezes' residents similarly. This being the case, it cannot be said that the Council member will enjoy a "special" private gain.


Accordingly, we find that no voting conflict of interest would exist were the subject Council member of the Town of Briny Breezes to vote on matters related to redevelopment of the Town, where she is a shareholder in the corporation which owns the land within the proposed redevelopment area and owns a home located in the proposed redevelopment area.


ORDERED by the State of Florida Commission on Ethics meeting in public session on July 27, 2007 and RENDERED this 1st day of August, 2007.

____________________________________

Albert P. Massey, III, Chairman


[1] You advise that the subject Council member and her spouse own 31 shares (0.197%), and that the other voting members own, with their spouses, between 27 (0.172%) and 46 (0.293%) shares.

[2] You advise that there is no overlap between the Board of Directors of Briny Breezes, Inc., and the Town Council, and that all of the Council members are, by virtue of their property interest, shareholders in the corporation.

[3] Complaint No. 139, 147 and 149 (Cons.), In re Robyn Anderson, Complaint No. 03-140 and 150 (Cons.), In re Julie Rivers, Complaint No. 03-151, In re Julie Weiss.