CEO 84-63 -- June 27, 1984

CONFLICT OF INTEREST

PORT AUTHORITY MEMBER OFFICER OF BUSINESSES DOING BUSINESS WITH PORT AUTHORITY

To: Mr. Jean Fitzgerald, Potential Appointee, Port Everglades Authority Commission

SUMMARY:

No prohibited conflict of interest would be created were an individual to be appointed to serve on a Port Authority where he is a vice president of a shipping company, a subsidiary of which holds a towing franchise granted by the Port Authority. The special act providing for the appointment requires appointment of a representative of business entities doing business with or at the port. Therefore, the exemption of Section 112.313(7)(b), Florida Statutes, would permit the individual to serve on the authority while retaining his employment.

No prohibited conflict of interest would be created were an individual to be appointed to serve on a port authority, where he is employed as executive director of a nonprofit corporation of which the port authority is a member and to which the authority provides funding. To the extent of any commitment to provide funding in existence at the time the individual takes office, his relationship with the corporation would be "grandfathered in" under Section 112.313(3)(c), Florida Statutes, and under previous opinions CEO 82-10 and 82-88. In addition, the authority's membership in the nonprofit corporation would indicate a unity of interest rather than a conflict of interest with respect to the individual's employment with the corporation.

QUESTION 1:

Would a prohibited conflict of interest be created were you to be appointed to serve on a port authority, where you are on leave of absence from your position as a vice president of a shipping company, a subsidiary of which holds a towing franchise granted by the port authority?

This question is answered in the negative under the circumstances presented.

In your letter of inquiry you advise that recently the Legislature passed a bill which would provide for the appointment of two members to the Port Everglades Commission by the Broward County Commission. The bill specifically provides:

One person so appointed shall be a representative of labor unions certified to represent employees of the port district, and the other person so appointed shall be a representative of business entities doing business with or at the port.

You also advise that you are on a leave of absence from a position as vice president of a shipping company, a subsidiary of which holds a towing franchise at the Port and performs towing services for many vessels calling there.

The Code of Ethics for Public Officers and Employees provides in relevant part:

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. The foregoing shall not apply to district offices maintained by legislators when such offices are located in the legislator's place of business. This subsection shall not affect or be construed to prohibit contracts entered into prior to

(a) October 1, 1975.

(b) Qualification for elective office.

(d) Beginning public employment.

[Section 112.313(3), Florida Statutes (1983).]

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), Florida Statutes (1983).]

We are of the opinion that the shipping company is not selling any services to the Port Authority by virtue of its towing franchise. Therefore, we find Section 112.313(3) to be inapplicable here. It does appear that should you be appointed to the Port Authority, you would be employed by a business entity which is doing business with your agency in possible violation of Section 112.313(7)(a).

However, Section 112.313(7)(b) also 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. [Section 112.313(7)(b), Florida Statutes (1983).]

Should you be appointed to the Port Authority as a "representative of business entities doing business with or at the Port," we believe that the above-quoted language would permit you to continue your employment as a vice president of the shipping company. Compare CEO 80-59 [Section 112.313(7)(b) applies to exempt council member required to be a representative of a medical school], with CEO 80-79 [Section 112.313(7)(b) does not apply to exempt an employee of a lending institution as being "knowledgeable in the field of finance"].

Accordingly, we find that no prohibited conflict of interest would be created by virtue of your employment as a vice president of a shipping company were you to be appointed to serve on the Port Authority Commission.

QUESTION 2:

Would a prohibited conflict of interest be created were you to be appointed to serve on a port authority, where you are employed as executive director of a nonprofit corporation of which the port authority is a member and to which the authority provides funding?

This question also is answered in the negative.

In your letter of inquiry you advise that last year you took a leave of absence from your position with the shipping company in order to work as executive director of a nonprofit, tax exempt corporation whose purposes are to protect the environment, the energy security, and the economy of the State. You also advise that the Port Authority is a member of this nonprofit corporation and has a seat on its board of directors. In addition, the Port Authority has contributed funds in support of the work of the corporation, and you anticipate that this support will continue at least through the remainder of this year.

In a telephone conversation with our staff, you advise that the membership of the corporation consists of approximately 30 maritime interests, including the Port Authority, the pilots' association from the Port, and the association of businesses located at the Port. In particular, the corporation has worked to oppose the conversion of a gas transmission pipeline to a petroleum pipeline.

The provisions of the Code of Ethics most relevant to this situation are those quoted above in response to your first question. As to any commitment on the part of the Port Authority in existence at the time you would take office to give funds to the nonprofit corporation, we are of the opinion that your relationship with the corporation would be "grandfathered in" expressly under Section 112.313(3)(c) and impliedly under the rationale of our previous opinions CEO 82-10 and CEO 82-88.

It is possible, however, that the commitment could be renewed during the time you would serve on the Port Authority Commission. In one sense, the nonprofit corporation could be viewed as selling services to the Port Authority and as doing business with the Port Authority. However, the Authority is a member of the nonprofit corporation, with a seat on its board of directors. This indicates that there is a unity of interests between the Port Authority and the nonprofit corporation, rather than a conflict of interests. For this reason, we believe that the following provision of the Code of Ethics would apply:

Construction. -- It is not the intent of this part, nor shall it be construed, to prevent any officer or employee of a state agency or county, city, or other political subdivision of the state or any legislator or legislative employee from accepting other employment or following any pursuit which does not interfere with the full and faithful discharge by such officer, employee, legislator, or legislative employee of his duties to the state or the county, city, or other political subdivision of the state involved. [Section 112.316, Florida Statutes (1983).]

Under these circumstances, it is apparent that your employment as executive director of the nonprofit corporation would not interfere with the full and faithful discharge of your duties as a member of the Port Authority Commission, and would not result in a continuing or frequently recurring conflict of interest which otherwise would violate Section 112.313(7)(a), Florida Statutes.

Accordingly, we find that no prohibited conflict of interest would be created were you to be appointed to serve on the Port Authority while remaining employed as the executive director of the nonprofit corporation.