CEO 16-08 — June 8, 2016
CONFLICT OF INTEREST; VOTING CONFLICT
COUNTY COMMISSIONER EMPLOYED BY COMPANY DOING BUSINESS WITH COUNTY
To: Name withheld at person's request (Hamilton County)
A prohibited conflict of interest would be created under Sections 112.313(3) and 112.313(7)(a), Florida Statutes, by a County Commissioner's employment with a business that sells vehicle parts to the County. However, if the business is the sole source within the County of certain products, the County Commissioner's conflict, as to those products, would be negated under the exemption in Section 112.313(12)(e), Florida Statutes. The County Commissioner must comply with the voting conflicts law regarding measures affecting his interest or the interests of his business. CEO 99-11, CEO 81-27, CEO 78-24, and CEO 78-17 are referenced.1
Would a prohibited conflict of interest be created if a County Commissioner were to be employed by a business that sells vehicle parts to the County?
Under the circumstances presented, your question is answered as set forth below:
In your letter and additional information provided to our staff, you state that you are considering becoming a candidate for a seat on a County Commission and that you also would like to continue employment with a local retail store that sells vehicle parts and products to the County.
You state that the store, owned by your grandfather, sells vehicle products including hydraulic hoses, filters, air fittings, tire hardware, ignition parts, automotive specialty tools, brake pads and rotors, batteries, and certain car-care products that are available within the County only through this store. You explain that the store sells these products on an as-needed basis, without contracts, to the County Road Department, Emergency Medical Services, the County Recreation Department, the County landfill, and County Emergency Management, and that payment for such sales is through the County Commission. You further state that, although two other stores in the County carry limited inventories of vehicle supplies, your employer is the only store that sells the products listed herein which the County requires.
The prohibitions of the Code of Ethics implicated are in Sections 112.313(3) and 112.313(7)(a), Florida Statutes. The prohibitions in Section 112.313(3) 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 first part of Section 112.313(3) prohibits a public officer from buying realty, goods, or services from a business of which he (or his spouse or child) is an officer, partner, director, or proprietor. Under the facts you present, this part of the provision would not apply to your situation, in that your position with the store would be employee and not officer, partner, director, or proprietor. However, the second part of Section 112.313(3) would prohibit you, if you were to serve on the County Commission, from acting in your private capacity as a store employee to sell goods, services, or realty to your public agency or to any part of your political subdivision. Absent the applicability of an exemption, this prohibition would prohibit you, as a store employee, from selling to any part of County government.2
Also implicated by your situation is Section 112.313(7)(a), which 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.
The first part of Section 112.313(7)(a) prohibits a public officer from having an employment or contractual relationship with a business entity that is regulated by or is doing business with the public officer's agency. If you were to serve on the County Commission and continue working at the store, you would hold employment with a business that sells vehicle products to your agency (the County). Absent the applicability of an exemption, you would have a prohibited conflict under the first part of Section 112.313(7)(a).
Among the exemptions in the Code of Ethics to the above-cited conflicts in Sections 112.313(3) and 112.313(7)(a) is the exemption provided in Section 112.313(12)(e), Florida Statutes, which states:
(12) EXEMPTION. — . . . In addition, no person shall be held in violation of subsection (3) or subsection (7) if:
(e) The business entity involved is the only source of supply within the political subdivision of the officer or employee and there is full disclosure by the officer or employee of his or her interest in the business entity to the governing body of the political subdivision prior to the purchase, rental, sale, leasing, or other business being transacted.
This provision can negate a conflict of interest under Sections 112.313(3) and 112.313(7)(a), Florida Statutes, where the business entity involved is the sole source of supply within the political subdivision of the public officer and where there is full disclosure by the public officer of his interest in or employment with the business entity to the governing body (e.g., County Commission) prior to the transaction. In CEO 78-17, the Commission on Ethics found that a fire district could purchase items from a hardware store owned by a district board member as long as that store remained the only source of supply of those particular items within the district. See also CEO 81-27 and CEO 78-24. Assuming that your private employer is the sole source of supply within your political subdivision (the County) of particular vehicle parts and products purchased by the County, if you were to serve as a County Commissioner, your employment with the store would be exempt from prohibited conflict under Sections 112.313(3) and 113.313(7)(a), Florida Statutes.3 You should complete CE Form 4A (Disclosure of Business Transaction, Relationship, or Interest) for disclosure of your private employment to the County Commission in order to avail yourself of the protection of the "so
Finally, if a measure (e.g., a vote to purchase or pay for sole-source products from your employer) that would inure to your special private gain or loss, to that of your private employer, or to that of other persons or entities listed in Section 112.3143(3)(a), Florida Statutes, were to come before the County Commission, you would be required to adhere to the procedures in Section 112.3143(3)(a). See CE Form 8B, available at www.ethics.state.fl.us.
Accordingly, we find that, if you were to serve as a County Commissioner, your employment with a store that does business with the County would be exempt under Section 112.313(12)(e), Florida Statutes, from prohibited conflicts as to particular vehicle parts and products as long as the store is the sole-source provider within the County of those particular items, but that you remain subject to the voting conflicts law of Section 112.3143(3)(a), Florida Statutes.
Your question is answered accordingly.
ORDERED by the State of Florida Commission on Ethics meeting in public session on June 3, 2016, and RENDERED this 8th day of June, 2016.
Stanley M. Weston, Chair
Opinions of the Commission on Ethics may be obtained from its website (www.ethics.state.fl.us).
"Agency" is defined in Section 112.312(2), Florida Statutes, as "any state, regional, county, local, or municipal government entity of this state, whether executive, judicial, or legislative." See also CEO 99-11.
The Commission on Ethics has found that a purpose of the sole source exemption is to alleviate hardships for local governments in their purchasing. See CEO 78-24. And, the Commission has found that whether a store stocks an item is relevant to applicability of the exemption. Therefore, we find that, if your employer is the only store in the County that stocks a particular item, that store will be the sole source of that item, regardless of whether another business could order the item which it does not ordinarily keep in stock.