CEO 87-47 -- June 11, 1987
CONFLICT OF INTEREST; VOTING CONFLICT
STATE REPRESENTATIVE INVESTING IN
PORTABLE CLASSROOM BUILDING COMPANY
To: The Honorable T. K. Wetherell, State Representative, District 29
Generally, no prohibited conflict of interest would be created under Sections 112.313(3) and 112.313(7), Florida Statutes, were a State Representative and vice president of a community college to be an investor, officer, and director of a corporation that builds and finances portable classroom buildings. The corporation could do business with the community college by sealed competitive bid if the requirements of Section 112.313(12)(b), Florida Statutes, are met. Further, no voting conflict of interest would be created under Section 112.3143, Florida Statutes, were the State Representative to vote on appropriation matters for agencies with which the corporation will be seeking to do business. Any gain received by the corporation as a result of these votes would be too remote and speculative to constitute "special gain" within the contemplation of Section 112.3143, Florida Statutes.
Would a prohibited conflict of interest be created were you, a State Representative and a vice president of a community college, to be an investor, officer, and director of a corporation that builds and finances portable classroom buildings?
This question is answered in the negative, subject to the exception noted below.
In your letter of inquiry you advise that you serve as a member of the Florida House of Representatives and that you are employed by Daytona Beach Community College as a Vice President. As a member of the House of Representatives, you chair the Appropriations Education Subcommittee, which is involved directly in drafting the appropriations bill with respect to public schools, community colleges, and universities within the State.
You also advise that you are considering becoming a major stockholder, officer, and director in a corporation that builds and finances portable classroom buildings for public schools, community colleges, and universities in this state and in other states. If you become associated with the corporation, it will not do business in your home county but will bid on contracts in other counties. As an officer of the corporation, it will not be your responsibility to solicit business from State agencies. Finally, you advise that the Legislature historically has not distinguished between permanent and portable structures in education funding and that you do not anticipate such a distinction in the future.
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.
(c) Appointment to public office.
(d) Beginning public employment.
[Section 112.313(3), Florida Statutes (1985).]
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 (1985).]
In CEO 82-33 we found that these provisions of the Code of Ethics would not prohibit a state representative from being employed by an insurance company seeking to contract with the Florida Housing Finance Agency. In CEO 78-39 and CEO 77-6, we advised that a state representative would not be prohibited from involvement with a corporation which would perform construction work for various State agencies. Based on the rationale of these opinions, we find that neither Section 112.313(3) nor Section 112.313(7)(a) would prohibit your involvement in the corporation while serving as a member of the House of Representatives.
As a Vice President of the Community College, both Section 112.313(3) and Section 112.313(7)(a), Florida Statutes, would prohibit the corporation from selling to the Community College -- your "agency" as that term is defined in Section 112.312(2), Florida Statutes. We note that you have advised that if you become associated with the corporation, it will not do business in your home county. However, the Code of Ethics provides an exemption to the prohibitions of Sections 112.313(3) and (7) where:
The business is awarded under a system of sealed, competitive bidding to the lowest or best bidder and:
1. The official or his spouse or child has in no way participated in the determination of the bid specifications or the determination of the lowest or best bidder;
2. The official or his spouse or child has in no way used or attempted to use his influence to persuade the agency or any personnel thereof to enter such a contract other than by the mere submission of the bid; and
3. The official, prior to or at the time of the submission of the bid, has filed a statement with the Department of State, if he is a state officer or employee, or with the Clerk of the Circuit Court of the county in which the agency has its principal office, if he is an officer or employee of a political subdivision, disclosing his, or his spouse's or child's, interest and the nature of the intended business. [Section 112.313(12)(b), Florida Statutes]
Therefore, the corporation could do business with the Community College through a system of sealed competitive bidding so long as you comply with the three requirements of this exemption. For your information, the disclosure required by this exemption should be made on CE Form 3A, Interest in Competitive Bid for Public Business.
We note that you have advised that if you become involved with the corporation, you will not be responsible for soliciting business from State agencies. Therefore, we see no problem with Article II, Section 8(e), Florida Constitution, which prohibits you from personally representing another person or entity for compensation before any State agency other than judicial tribunals. See CEO 84-9 and CEO 82-33.
Accordingly, we find that no prohibited conflict of interest with your duties as a State Representative would be created were you to be an investor, officer, and director of a corporation that builds and finances portable classroom buildings. Further, the corporation may do business with the Community College which you serve as Vice President if that business is transacted by sealed, competitive bid and if the requirements of Section 112.313(12)(b), Florida Statutes, are met.
Would a voting conflict of interest be created were you, a State Representative and an investor, officer, and director of a corporation that builds and finances portable classroom buildings, to vote on appropriation matters for agencies with which the corporation will be seeking to do business?
This question is answered in the negative.
Regarding voting conflicts of interest for State officials, the Code of Ethics provides:
Except as provided in subsection (3), no public officer is prohibited from voting in his official capacity on any matter. However, any public officer voting in his official capacity upon any measure which inures to his special private gain or the special gain of any principal by whom he is retained shall within 15 days after the vote occurs, disclose the nature of his interest as a public record in a memorandum filed with the person responsible for recording the minutes of the meeting, who shall incorporate the memorandum in the minutes. [Section 112.3143(2)(a), Florida Statutes (1985).]
Under this provision, you would be required to file a memorandum of voting conflict if you vote on a measure which inures to your special gain or to the special gain of a principal by whom you are retained.
In previous opinions we have found no "special" gain to exist when the circumstances were such that any gain or loss to the public official, or one by whom he was retained, was too remote or speculative. See CEO 85-77 and CEO 85-87. You have advised that the Legislature has not distinguished between permanent and portable structures in its educational funding. In addition, we note that appropriations to educational agencies would not directly benefit the corporation with which you would be associated. Each school district, community college, and university, after receiving its appropriation, still would have to determine which company it would purchase from, presumably through a competitive bid process. Therefore, appropriations to these agencies could benefit the corporation or could benefit competing businesses. Under these circumstances, we find that any gain which might be received eventually by the corporation as a result of appropriation measures is too remote and speculative to enable us to conclude that the corporation would derive any "special" gain.
Accordingly, we find that no voting conflict of interest would be created were you to become associated with the corporation and to vote on appropriation matters for agencies with which the corporation will be seeking to do business.