CEO 84-67 -- August 9, 1984

CONFLICT OF INTEREST

COUNTY TOURIST DEVELOPMENT COUNCIL MEMBERS INVOLVED IN TOURISM RELATED ACTIVITIES

To: Mr. Frank N. Romano, Vice Chairman, Monroe County Tourist Development Council

SUMMARY:

Sections 112.313(3) and 112.313(7), Florida Statutes, would prohibit a county from paying for accommodations provided for several travel writers at a hotel or motel owned or managed by a county tourist development member. However, Section 112.313(12)(f), Florida Statutes, would exempt the payment of no more than $500 to each of the members' establishments. These provisions would prohibit a council member from serving as president of a nonprofit organization receiving more than $500 of tourist development funds for promotional activities and would prohibit a council member from managing for compensation public festivals receiving more than $500 of financial support from tourist development funds. The exemption of Section 112.313(12), however, would permit the county commission to waive these conflicts of interest in behalf of advisory boards such as the Tourist Development Council. CEO 82-51 is referenced.

QUESTION 1:

Would a prohibited conflict of interest be created were a county to pay for accommodations provided for several travel writers at a hotel or motel owned or managed by a member of the County Tourist Development Council?

This question is answered in the affirmative, except to the limited extent noted below.

In your letter of inquiry you advise that Mrs. Margo Golan and Mr. Eddie Breeze, members of the Monroe County Tourist Development Council, are the proprietor and general manager respectively of two hotels or motels in the City of Key West. You also advise that in January of 1984 the Tourist Development Council welcomed some important travel writers to Key West. Unfortunately, occupancy rates were very high and no motel or hotel was willing to give complimentary rooms. The Council offered to pay any hotel that would take the travel writers and accommodate them for the two or three days they were to be in Key West. However, no one was willing to forego any of their reservations.

In order to avoid embarrassing the Council, these two Council members offered to accommodate the travel writers, rather than refuse them accommodations in Key West. The County Clerk denied payment of the bills for occupancy of the accommodations on the ground that members of the council receiving reimbursement for accommodations for travel writers would amount to a conflict of interest. This determination was made despite unanimous approval by the Council to accommodate the travel writers with paid accommodations.

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).]

The first of these provisions prohibits a Council member from acting in an official capacity to purchase any services from a business entity of which he is an officer or owns more than a five percent interest, and prohibits a Council member from acting in a private capacity to sell any services to the County. Of similar effect in this case is Section 112.313(7)(a), which prohibits a Council member from having any employment or contractual relationship with a business entity which is doing business with his agency. We are of the opinion that these provisions would be violated were the County to pay the subject Council members' hotel or motel for accommodations provided to the travel writers.

However, there are several exemptions to these prohibitions provided in the Code of Ethics, including exemptions where:

An emergency purchase or contract which would otherwise violate a provision of subsection (3) or subsection (7) must be made in order to protect the health, safety, or welfare of the citizens of the state or any political subdivision thereof. [Section 112.313(12)(d), Florida Statutes (1983).]

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 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. [Section 112.313(12)(e), Florida Statutes (1983).] The total amount of the subject transaction does not exceed $500. [Section 112.313(12)(f), Florida Statutes (1983).]

While an emergency may have existed in the sense that it was important to accommodate the travel writers in Key West, we do not believe that providing them accommodations protected the health, safety, or welfare of the citizens of the county. As you have written, the accommodations were provided by the Council members in order to avoid embarrassing the Council. We do not consider that avoiding potential embarrassment should be equated with protecting the health, safety, or welfare of the citizens of the County.

While the Council members' hotels or motels may have been the only source of accommodations within the Key West area for the travel writers, we do not believe that there has been sufficient compliance with Section 112.313(12)(e) to enable us to conclude that this exemption would apply here. First, the exemption requires that the business entity involved be the sole source of supply within the political subdivision, which in this case is the County rather than the City. Secondly, the exemption requires disclosure (on Commission on Ethics Form 4A) prior to the transaction of business. You have not indicated that any disclosure was made to the County Commission in compliance with this requirement.

Finally, Section 112.313(12)(f) provides an exemption where the total amount of the transaction does not exceed $500. We have interpreted this exemption to permit the transaction of no more than $500 worth of business during any calendar or fiscal year. CEO 77-182. We have been advised that the bills from the two establishments amounted to $590.65 and $897.00. We are of the opinion that this exemption clearly authorizes the county to pay $500 to each of these establishments.

Accordingly, we find that the county may pay each of the hotels or motels owned or managed by members of the Tourist Development Council no more than $500 for accommodations provided for the travel writers.

QUESTION 2:

Would a prohibited conflict of interest be created were a county tourist development council member to serve as president of a nonprofit organization receiving tourist development funds for promotional activities?

This question is answered in the affirmative, subject to the exemptions noted below.

In your letter of inquiry you advise that Mr. William Wickers, Jr., a member of the Tourist Development Council, is a charter boat captain active in a local Charter Boat Association, which is a nonprofit organization. In a telephone conversation with our staff, you advised that he serves as president of the organization, but receives no compensation for his efforts in behalf of the organization. You also advise that the organization seeks funding from the Council for various promotional activities and for the promotion of tournaments.

In a previous opinion, CEO 82-51, we concluded that Section 112.313(3), Florida Statutes, quoted above in our response to your first question, would prohibit a county commissioner, an assistant county administrator, or a county tourist development council member from serving as an officer or director of a nonprofit corporation receiving tourist development funds to promote tourism in the county. However, we noted in that opinion that Section 112.313(12), Florida Statutes, permits the appointing body of an advisory board member to waive a particular conflict of interest of that board member upon full disclosure of the transaction or relationship and an affirmative two-thirds vote. Therefore, we concluded that as a tourist development council's functions are advisory, the county commission could waive the prohibition of Section 112.313(3), for a member of the council in the manner specified by Section 112.313(12), Florida Statutes.

In accordance with the rationale of that opinion, we find that a prohibited conflict of interest would be created were the subject Tourist Development Council member to serve as president of a nonprofit organization receiving tourist development funds unless the County Commission waives such a conflict of interest in the manner provided by Section 112.313(12), Florida Statutes. Please note that as we explained in our response to your first question, Section 112.313(12)(f), Florida Statutes, would permit the organization to receive no more than $500 per year of tourist development funds if the County Commission does not waive the subject Council member's conflict of interest.

QUESTION 3:

Would a prohibited conflict of interest be created were a county tourist development council member to manage two public festivals which receive financial support from tourist development funds?

This question also is answered in the affirmative, subject to the exemptions noted below.

In your letter of inquiry you advise that Mr. Michael Whalton, a member of the Tourist Development Council, has organized and run two public festivals in Key West, receiving compensation for managing the events. Both events will look to the Council for financial support for advertising and promotion funds.

We are of the opinion that Sections 112.313(3) and 112.313(7)(a) would be violated were the subject Council member to receive compensation for his services in managing a festival receiving financial support from tourist development funds. However, as we explained in response to your second question, the Code of Ethics authorizes the County Commission to waive conflicts of interest on the part of Tourist Development Council members. Otherwise, the only exemption which could apply is the $500 exemption provided in Section 112.313(12)(f), Florida Statutes.

Accordingly, we find that a prohibited conflict of interest would be created were the subject Tourist Development Council member to receive compensation for managing two public festivals receiving more than $500 worth of tourist development funds, unless the County Commission votes to waive this conflict of interest in the manner provided by Section 112.313(12), Florida Statutes.