CONFLICT OF INTEREST; LOCAL GOVERNMENT ATTORNEYS
HEALTH FACILITIES AUTHORITY EXECUTIVE DIRECTOR
AND GENERAL COUNSEL'S PRIVATE PRACTICE PROVIDING
ADDITIONAL LEGAL SERVICES TO AUTHORITY
To: Name withheld at person's request
A prohibited conflict of interest would be created under Sections 112.313(3) and 112.313(7)(a), Florida Statutes, were an employee (executive director/general counsel) of a health facilities authority to provide legal services (bond issuer's counsel services), via her private law practice, to the authority. The public employee would be acting in a private capacity to sell services to her agency and she would hold employment or a contractual relationship with a business entity (her firm) doing business with her agency. However, a prohibited conflict would not be created under either statute were the employee to perform issuer's counsel services in her capacity as an authority employee. CEO 81-49, CEO 81-50, CEO 90-70, CEO 03-9, and CEO 08-8 are referenced.1
Would a prohibited conflict of interest be created were you, an employee (executive director and general counsel) of a health facilities authority, to provide issuer's counsel legal services, via your private law practice, to the authority, regarding authority conduit bonds?
Under the circumstances presented, your question is answered in the affirmative.
By your letter of inquiry and additional information provided via e-mail to our staff, we are advised that following a long history of providing administrative and legal services as an independent contractor to the ...County Health Facilities Authority (Authority), you now provide a portion of the same services (Authority Executive Director services and Authority General Counsel legal services) to the Authority as its employee, occupying, since June 2005, the position of Executive Director/General Counsel. In addition, we are advised that prior to your employment with the Authority in June 2005, you provided Issuer's Counsel legal services to the Authority (regarding conduit bond issues) as an independent contractor, via your private, full-time law practice, which law practice you still engage in on a part-time basis with the knowledge and consent of the Authority; that you have not provided such services to the Authority since 2005 but that such issues and your provision of services are possible this year; and that you seek our opinion as to whether your provision of such services to the Authority, via your private practice, would create a prohibited conflict of interest under the Code of Ethics, in light of your now being an employee of the Authority [a public "agency" within the meaning of Section 112.312(2), Florida Statutes].2
Relevant to your inquiry are Sections 112.313(3) and 112.313(7)(a), Florida Statutes, which provide:
DOING BUSINESS WITH ONE'S AGENCY.- No employee of an agency acting in his or her official capacity as a purchasing agent, or public officer acting in his or her official capacity, shall either directly or indirectly purchase, rent, or lease any realty, goods, or services for his or her own agency from any business entity of which the officer or employee or the officer's or employee's spouse or child is an officer, partner, director, or proprietor or in which such officer or employee or the officer's or employee's spouse or child, or any combination of them, has a material interest. Nor shall a public officer or employee, acting in a private capacity, rent, lease, or sell any realty, goods, or services to the officer's or employee's own agency, if he or she is a state officer or employee, or to any political subdivision or any agency thereof, if he or she is serving as an officer or employee of that political subdivision. The foregoing shall not apply to district offices maintained by legislators when such offices are located in the legislator's place of business or when such offices are on property wholly or partially owned by the legislator. This subsection shall not affect or be construed to prohibit contracts entered into prior to:
(a) October 1, 1975.
(b) Qualification for elective office.
(c) Appointment to public office.
(d) Beginning public employment.
[Section 112.313(3), Florida Statutes.]
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.]
In Howard v. State Commission on Ethics, 421 So. 2d 37 (Fla. 3d DCA 1982), the District Court of Appeal affirmed our advisory opinion (CEO 81-50) in which we found that a prohibited conflict of interest existed under Section 112.313(3) where an attorney employed by a school board as school board attorney also was a partner in a law firm which had contracted to provide legal services to the school board. In CEO 81-50, we reasoned that the attorney, an employee of the school board, had acted in a private capacity to sell the firm's legal services to the school board, contrary to Section 112.313(3).
We find your situation to be analogous to that of Howard/CEO 81-50, and thus find that a prohibited conflict of interest would be created under Section 112.313(3) were you to perform Issuer's Counsel legal services, or other services, for the Authority in your private law firm capacity. By so doing, you would be acting in a private capacity to sell services to your political subdivision or agency. And we also find that a prohibited conflict of interest would be created under Section 112.313(7)(a) were you to perform Issuer's Counsel legal services, or other services, for the Authority in your private law firm capacity; such a situation would constitute your holding employment or a contractual relationship with a business entity (your private law firm) which would be doing business with the Authority (your public agency). See CEO 81-49.
In so finding, we have not overlooked the grandfather clause expressed in Section 112.313(3), nor the language of Section 112.316, Florida Statutes, which can imply a grandfather clause regarding Section 112.313(7)(a), regarding contracts between a public agency and a business entity entered into before a person assumes public employment. However, your situation is not indicative of such a grandfathering. Notwithstanding that for many years you performed Issuer's Counsel services for the Authority as an independent contractor, and notwithstanding that you may (in some status or capacity) perform such services for the Authority in the future, your situation is not indicative of a static, duration-certain, provision-certain "meeting of the minds," solidified and entered into before you became a public employee, as would be necessary to support grandfathering. See, for example, CEO 81-50 and CEO 08-8 (Question 1). In this regard, we note that your Contract of Employment Extension Agreement, which addresses both your employee Executive Director/General Counsel status and the provision of Issuer's Counsel legal services, was entered into in June 2008, several years after your employment with the Authority.
This question is answered accordingly.3
Would a prohibited conflict of interest be created under either Section 112.313(3) or Section 112.313(7)(a) were you to perform legal services as Issuer's Counsel in your capacity as an employee of the Authority?
This question is answered in the negative.
In such a situation, your firm (private law practice), a business entity, will not be providing services to, or doing business with, the Authority. Rather, your public employment merely will encompass additional duties, for which it would not be improper for you to receive additional public salary. See, for example, CEO 90-70 (sheriff's employees given additional duties as jail contract monitors with additional compensation) and CEO 03-9 (county parks and recreation employees performing additional duties).
This question is answered accordingly.
ORDERED by the State of Florida Commission on Ethics meeting in public session on July 25, 2008 and RENDERED this 30th day of July, 2008.
Albert P. Massey, III, Chairman
LOCAL GOVERNMENT ATTORNEYS.-
(a) For the purposes of this section, "local government attorney" means any individual who routinely serves as the attorney for a unit of local government. The term shall not include any person who renders legal services to a unit of local government pursuant to contract limited to a specific issue or subject, to specific litigation, or to a specific administrative proceeding. For the purposes of this section, "unit of local government" includes, but is not limited to, municipalities, counties, and special districts.
(b) It shall not constitute a violation of subsection (3) or subsection (7) for a unit of local government to contract with a law firm, operating as either a partnership or a professional association, or in any combination thereof, or with a local government attorney who is a member of or is otherwise associated with the law firm, to provide any or all legal services to the unit of local government, so long as the local government attorney is not a full-time employee or member of the governing body of the unit of local government. However, the standards of conduct as provided in subsections (2), (4), (5), (6), and (8) shall apply to any person who serves as a local government attorney.
(c) No local government attorney or law firm in which the local government attorney is a member, partner, or employee shall represent a private individual or entity before the unit of local government to which the local government attorney provides legal services. A local government attorney whose contract with the unit of local government does not include provisions that authorize or mandate the use of the law firm of the local government attorney to complete legal services for the unit of local government shall not recommend or otherwise refer legal work to that attorney's law firm to be completed for the unit of local government.