CEO 77-16 -- February 1, 1977
CONFLICT OF INTEREST
EMPLOYEE OF DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES SERVING ON BOARD OF DIRECTORS OF NONPROFIT MENTAL HEALTH ORGANIZATION
To: Carol Dahlen, Department of Health and Rehabilitative Services, Tallahassee
Prepared by: Phil Claypool
Noncompensated service on the board of directors of a district mental health nonprofit corporation does not constitute a contractual relationship or employment for purposes of s. 112.313(7)(a), F. S. 1975. Accordingly, an employee of the State Department of Health and Rehabilitative Services would not hold employment or a contractual relationship with a business entity subject to the regulation of his agency in violation of that statute were he to serve on the board of directors of the corporation. As the mental health association does not do business with the department, neither would s. 112.313(3) be violated by the above-described situation.
Does a prohibited conflict of interest exist where I, an employee of the Department of Health and Rehabilitative Services, also serve as a director of a nonprofit mental health organization which receives funds from the department?
Your question is answered in the negative.
In your letter of inquiry you have stated that you presently are employed by the Department of Health and Rehabilitative Services (DHRS) as that agency's Records Management Liaison Officer. In that position, you give intermediate approval on the retention, disposal, and/or storage of HRS records, including the records of all district mental health boards and service providers. Final approval is given by the Department of State, Division of Archives, History, and Records Management.
You have recently been appointed to serve on the Board of Directors of Apalachee Mental Health Services, Inc. That corporation is a nonprofit organization whose function is to provide a comprehensive range of community-based professional mental health services in order to prevent or alleviate mental and emotional problems of individuals in its district. Funding of the organization is provided by state, federal, county, and city government; United Way; fees based on ability to pay; and other donated funds.
The Code of Ethics for Public Officers and Employees 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 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 private interests and the performance of his public duties or that would impede the full and faithful discharge of his public duties. [Section 112.313(7)(a), F. S. 1975.]
This provision prohibits a public employee from having an employment or contractual relationship with a business entity which is regulated by or doing business with her agency; it also prohibits a public employee from having an employment or contractual relationship that would create a frequently recurring conflict between her private interests and the performance of her public duties. However, you receive no compensation for your services as an appointed director. Consequently, this provision does not apply to your situation because you do not have an employment or contractual relationship with the nonprofit corporation. See CEO 76-202.
The Code of Ethics also provides as follows:
DOING BUSINESS WITH ONE'S AGENCY. -- No employee of an agency acting in his official capacity as a purchasing agent, or public officer acting in his official capacity, shall either directly or indirectly purchase, rent, or lease any realty, goods, or services for his own agency from any business entity of which he or his spouse or child is an officer, partner, director, or proprietor or in which such officer or employee or his 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 his own agency, if he is a state officer or employee, or to any political subdivision or any agency thereof, if he is serving as an officer or employee of that political subdivision. . . . [Section 112.313(3), F. S. 1975.]
This provision prohibits a public employee acting in a private capacity from renting, leasing, or selling any realty, goods, or services to her own agency if she is a state employee. We have previously determined that a public officer or employee is acting in a private capacity whenever a corporation of which she is a director takes action. However, we do not find this provision applicable inasmuch as the mental health organization is not selling services to DHRS; instead DHRS merely provides funds for the organization which, in turn, uses those funds to provide mental health services for the community which it serves.
Accordingly, we find that the Code of Ethics does not prohibit your serving on the board of directors of a nonprofit mental health organization while being employed by the Department of Health and Rehabilitative Services.