CONFLICT OF INTEREST
PORT AUTHORITY MEMBER EMPLOYEE OF SHIPPING AGENT
To: Name withheld at person's request (Yulee)
SUMMARY:
A prohibited conflict of interest would be created under Section 112.313(7)(a), Florida Statutes, were an employee of a shipping agent to be elected to and become a member of a port authority. The interests of his employer would be regulated by the port authority and a continuing or frequently recurring conflict of interest or an impediment to the full and faithful discharge of public duty would exist because of his simultaneous private/public interests regarding his employer's coordination of the logistical aspects of the entry and exit of ships into the port and because of his employer's complicated business involvements at the port. CEO 03-17 is referenced and CEO 84-63 is distinguished.1
QUESTION:
Would a prohibited conflict of interest be created were you, an employee of a shipping agent operating at a port, to become a member of the port authority?
Your question is answered in the affirmative.
By your letter of inquiry, an earlier letter from you, and additional written information supplied by you at the request of our staff, we are advised that you are seeking election to a seat on the board of the Ocean Highway and Port Authority, an independent special district located in Nassau County (see Chapter 2005-293, Laws of Florida) which, among other functions, operates or administers the Port of Fernandina. In addition, you advise that you are employed by a company that is the shipping agent for ships of its parent company, and for ships of other companies, that enter the Port and load and discharge cargo, working as a representative of ships operators, owners, or charters. Further, you advise that as a shipping agent, your employer coordinates the logistical aspects of the entry and exit of ships into the Port.2
Thus, you inquire as to whether your serving on the Port Authority board while continuing your employment with a shipping agent operating at the Port would create a prohibited conflict under the Code of Ethics for Public Officers and Employees (Part III, Chapter 112, Florida Statutes).
In relevant part, the Code provides:
CONFLICTING EMPLOYMENT OR CONTRACTUAL RELATIONSHIP.-No public officer or employee of an agency shall have or hold any employment or contractual relationship with any business entity or any agency which is subject to the regulation of, or is doing business with, an agency of which he or she is an officer or employee . . .; nor shall an officer or employee of an agency have or hold any employment or contractual relationship that will create a continuing or frequently recurring conflict between his or her private interests and the performance of his or her public duties or that would impede the full and faithful discharge of his or her public duties. [Section 112.313(7)(a), Florida Statutes.]
We find that a prohibited conflict of interest would be created under Section 112.313(7)(a) were you to hold both positions simultaneously. The facts of your inquiry are analogous to the facts of CEO 03-17, a previous opinion of ours in which we found that a prohibited conflict of interest would be created under the statute were a chairman of a shipping company operating at the Port of Tampa to be appointed to the Tampa Port Authority. In CEO 03-17, we reasoned that the authority regulated the would-be authority member's company's corporate interests, thus creating a prohibited conflict of interest under the first part of Section 112.313(7)(a) independent of any business relationship (or lack of business relationship) between his company and the authority. Similarly, in your situation, we note that the Authority regulates the activities or interests of shipping agents (such as your employer), vis-ã-vis its power set forth in the special act of the Legislature creating the Authority, and implemented via its use of its Port manager.3
Also, like we found in CEO 03-17, we find that your holding of the two positions would create a continuing or frequently recurring conflict between your private interests (or those of your private employer) and the performance of your public duties or would impede the full and faithful discharge of your public duties, a finding of prohibited conflict independent of and not grounded in any regulatory interface. At the Port of Tampa (CEO 03-17), the shipping company with which the person held employment or a contractual relationship carried products in and out of the port; at the Port of Fernandina, the shipping agent with which you hold employment coordinates the logistical aspects of the entry and exit of ships into the Port and has complicated business involvements with companies and actors at the Port. In essence, the statute prohibits a person from wearing "two hats," one public and one private, in relation to the same subject matter.4 See Zerweck v. State Commission on Ethics, 409 So. 2d 57 (Fla. 4th DCA 1982). Information provided by you itself supports our finding of an impermissible overlap of public and private roles; in responding to our staff's request for additional information, you write5:
In short, I am of the opinion that my position [of private employment] is one that would provide me with regular access to the Port and[,] if elected, this access could prove valuable as it is a way to really see the day-to-day operations of the Port Authority's main source of income. [Kinder Morgan/Nassau Terminals] is the management company and employed by the [Port Authority]. This regular contact would prove as a true check and balance for the [Port Authority], as there is a history of [Kinder Morgan/Nassau Terminals] de-prioritizing certain operational needs of the [P]ort to the [Port Authority]. I spoke to a member of the [Port Authority] recently and he is excited at the prospect of having me on the board as it would provide the board with a member who has first hand knowledge of the maritime industry, something that has not been available in the past.
Accordingly, we find that a prohibited conflict of interest would be created were you to become a member of the Port Authority while continuing your relationship with your employer.
ORDERED by the State of Florida Commission on Ethics meeting in public session on February 29, 2008 and RENDERED this 5th day of March, 2008.
____________________________________
Albert P. Massey, III, Chairman
[1]For prior opinions of the Commission on Ethics, go to www.ethics.state.fl.us, go to Research, go to Advisory Opinions, go to the year, and go to the particular opinion number.
[2] You advise that you are employed by Green Island Maritime Services, a wholly-owned subsidiary of Seaboard Marine, Ltd. (based in Miami); that Nassau Terminals is a wholly-owned subsidiary of, or a fictitious (d/b/a) name used by, Kinder Morgan, Inc., which manages the Port on behalf of the Port Authority; and that your employer (Green Island) is the shipping agent for Seaboard Marine's ships and other ships that enter the Port and that load and discharge cargo using Nassau Terminal's labor and equipment. More particularly, via the additional information requested by our staff, you advise that Seaboard Marine has four vessels that call the Port, twice a month on average, using Nassau Terminals' facility for storing containerized cargo, also using the stevedores, line handlers, and cranes at the facility; that Green Island (your employer) represents its customers or principals (including Seaboard Marine) at the Port, coordinating all aspects of a vessel's call, including setting up stevedoring, pilotage, tugs and security services, filing required documents with Federal agencies, and setting up delivery of goods and services to the vessel while in Port; that Green Island contracts with, and then pays, Kinder Morgan/Nassau Terminals on behalf of its clients for services rendered to its clients; that Green Island has contact with various people at Kinder Morgan/Nassau Terminals' facility at the Port, including operations and business managers, in order to ensure that its clients/principals are receiving adequate service; but that Green Island itself does not own any ships which call at the Port and itself does not ship cargo on ships calling at the Port.
[3]Section 7 of Chapter 2005-293 grants powers to the Authority, including [the power] to improve and develop Fernandina Harbor and all navigable and nonnavigable waters within the County of Nassau; to create and improve for harbor purposes any waterways within or adjacent to the county; to regulate and control all such waters and all natural or artificial waterways within the county; . . . and to enact, adopt, and establish, by resolution, rules and regulations for the complete exercise of jurisdiction and control over all waters and any port within the jurisdiction of the authority.
[4] In making our decision, we have not overlooked that you are not an officer of your employer-company, that your employer-company does not sell services to the Port and does not lease property from the Port, and that you are merely an employee who does not oversee day-to-day operations or make personnel or budgetary decisions for your employer-company. However, Section 112.313(7)(a) does not require for a prohibited conflict that a public officer's private employment or contractual relationship (his private work) be of a managerial or leadership nature, and the statute is phrased in the alternative, encompassing both regulatory and business relationships. Also, we have not overlooked CEO 84-63, a prior opinion of ours finding that a member of the then Port Everglades Authority would not have a prohibited conflict under the statute where he was vice president of a shipping company, a subsidiary of which held a towing franchise granted by the port authority. The finding of no conflict in CEO 84-63 was grounded in the special language of Section 112.313(7)(b), Florida Statutes, the applicability of which is dependent on a port's special act specifying or "waiving," for port authority membership, private employment or private relationships otherwise conflicting under Section 112.313(7)(a). Unlike the situation present in CEO 84-63, your Port's special act (Chapter 2005-293) appears to have no such specification of membership language. Section 112.313(7)(b) provides:
This subsection shall not prohibit a public officer or employee from practicing in a particular profession or occupation when such practice by persons holding such public office or employment is required or permitted by law or ordinance.
The bill passed by the Legislature regarding the then Port Everglades Commission (CEO 84-63) provided:
One person so appointed shall be a representative of . . . business entities doing business with or at the port.
[5]Again, if the Legislature so desires, it can waive conflicts generated by one's private capacity involvement with activities or subject matter of one's public agency. It has yet to do so regarding the Port Authority which you seek to become a member of. See Section 112.313(7)(b), Florida Statutes, CEO 84-63, CEO 03-17, and Chapter 2005-293, Laws of Florida.