CEO 94-8 -- March 10, 1994
CONFLICT OF INTEREST
TOWN MAYOR EMPLOYED BY ENGINEERING
FIRM DOING BUSINESS WITH TOWN
To: Richard V. Neill, Jr., Town Attorney, Town of St. Lucie Village
Absent the applicability of an exemption under Section 112.313(12), Florida Statutes, a prohibited conflict of interest would be created under Section 112.313(7)(a), Florida Statutes, were an engineering firm which employs a town's mayor to contract with the town to provide engineering services. The mayor would hold employment with a business entity doing business with the town. CEO's 85-9, 86-29, 86-37, 86-41, 88-29, and 91-24 are referenced.
Would a prohibited conflict of interest be created were an engineering firm which employs a town's mayor to contract with the town to provide engineering services?
Your question is answered in the affirmative.
By your letter of inquiry, and correspondence and a telephone conversation between you and our staff, we are advised that William Thiess serves as Mayor of the Town of St. Lucie Village and is an employee of an engineering firm. As Mayor, he is not a member of the Town's governing board (the Board of Aldermen) but serves as the chief executive officer of the Town and the presiding officer at all meetings of the Board of Aldermen which he attends. In addition, you advise that "[i]n the event of a tie vote among the aldermen, the Mayor is entitled to cast a vote in order to break the tie" but that "the Mayor is not otherwise involved in the decision making process."
Further, you advise that the Board is negotiating a contract for engineering services pursuant to a $100,000 DEP/EPA grant that was obtained via a detailed grant application that was prepared by the Mayor, in his capacity as Mayor or when he previously served as an Alderman. In addition, you advise that pursuant to the direction of the DEP, the Town is going through the process set forth in the Consultants' Competitive Negotiation Act and that the Town is thus negotiating the terms of a contract with the Board's primary selection (the firm employing the Mayor). Neither the Mayor nor his spouse or child is an owner, officer, or director of, or a holder of a material interest in, the firm; he will have no involvement in behalf of the firm regarding the contract with the Town; and he does not stand to profit as a consequence of the firm receiving the grant business, you advise.
You advise that only eight "Statements of Qualifications" were received from firms interested in doing business with the Town under the grant, after considerable effort had been expended by the Town to obtain applicants for the work. After two meetings of the Board, neither of which was attended by the Mayor, the Board ranked the Mayor's employer as its top selection. In addition, you advise that the Mayor's employer likely will be hired by the Town to perform the grant work. You advise that none of the Town's elected positions, including that of Mayor, is a paid position and that the Board, rather than the Mayor, has the authority to hire the firm and administer the contract with it.
The sections of the Code of Ethics for Public Officers and Employees applicable to your inquiry provide:
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 of 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 or when such offices are on property wholly or partially owned by the legislator. 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.]
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.]
We find that Section 112.313(3) would not be violated were the firm to do business with the Town because the Mayor (or his spouse or child) is not an officer, partner, director, or proprietor of, nor a holder of a material interest in, the firm. In addition, the Mayor, by virtue of his lack of involvement with the contract with the Town in behalf of the firm, would not be acting in a private capacity to sell the firm's services to the Town.
However, we do find that Section 112.313(7)(a) would be violated, absent the applicability of an exemption under Section 112.313(12), Florida Statutes, because the Mayor would hold employment or a contractual relationship with the firm, a business entity doing business with the City. We have opined similarly in many situations involving mayors and members of local governing boards, including CEO 85-9, CEO 86-29, CEO 86-37, and CEO 86-41.
We recognize that our decision in this matter may work a harsh result, as was the case in CEO 91-24, a situation in which the State Comptroller inherited a small amount of stock in companies whose subsidiaries were subject to the regulation of the Department of Banking and Finance. However, as we discussed in CEO 91-24, our function is to interpret the ethics laws, not to make or amend them. It is the province of the Legislature to change the law to accommodate situations such as the Mayor's.
We do not find that Section 112.316, Florida Statutes, would operate to negate the conflict. That statute provides:
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.
We have applied Section 112.316 as a "grandfather clause" to negate conflict in situations in which the business or contract between the public agency and the private entity was entered into prior to the public official taking office. See, for example, CEO 88-29. Such a use of Section 112.316 is based upon the reasoning that a public official could not have been tempted to compromise the performance of his public duties in favor of his private interests regarding an agreement with his public agency when he in fact held no public office at the time of the agreement and thus had no public duties to carry out or be tempted to compromise. Such is not the case under your scenario because the business relationship between the Mayor's employer and the Town, if it is entered into, will be entered into while the Mayor holds his public position. Also, we note that the Mayor (in a public capacity) was involved in preparing the grant application that enabled the Town to hire an engineering firm--potentially, the firm that employs him.
We do not view the fact that the Mayor is not a member of the Town's governing board and that he has a somewhat limited public role in choosing an engineering firm to be determinative of our decision in this matter. As Mayor (or in his previous service as an Alderman), he prepared the grant application in behalf of the Town. As Mayor, he has the duty to be involved in the selection process short of regular voting or actual selection (at the very least to give his unfettered opinion regarding engineering firms to the governing board or other Town personnel)--duties he could be tempted to compromise due to his private employment. In addition, we have not found previously that a mayor is an "agency" separate and distinct from a municipality's governing board for purposes of the Code of Ethics. The Code's definition of "agency" [Section 112.312(2), Florida Statutes] primarily distinguishes between units or parts of government in such a way that a public officer's or employee's agency is that part of government over which he has official contact, input, duties, or responsibilities. For example, a truck driver in a city's waste collection department would not have the city's governing board as his agency. However, that lack of interplay between the Mayor and the Town's Board of Aldermen would not appear to be present here. For example, in addition to our other concerns expressed in this opinion, the Mayor might have the public duty of signing the contract with his engineering firm on behalf of the Town, or he might be faced with voting in the event of a tie vote on the contract.
In making our findings herein, we do not find, explicitly or implicitly, that the Mayor has actually breached, or that he would actually breach, his public obligations because of his private affiliation. Section 112.313(7)(a) only requires that the official's private employment put him in a position where he could be tempted to dishonor his obligations. See Zerweck v. State Commission on Ethics, 409 So. 2d 57 (Fla. 4th DCA 1982).
Although Section 112.313(12), Florida Statutes, contains several exemptions to Section 112.313(7), in order for the sole source exemption of Section 112.313(12)(e) to be applicable, the firm that does business with the Town must be the only provider of engineering services located within the geographical limits of the Town, since the Town and not the County in which it is located is the political subdivision for purposes of the exemption. See CEO 84-67.
The State's anti-nepotism law (Section 112.3135, Florida Statutes), which you mention in one of your letters, is not analogous to Section 112.313(7)(a) because it requires proof of elements not contained in Section 112.313(7)(a) in order to find a violation, including the authority to hire, promote, etc.
Accordingly, we find that a prohibited conflict of interest would be created were the engineering firm which employs the Mayor to contract with the Town.
If the Mayor resigns or concludes his term of office prior to the Board's entering a contract with the Mayor's employer, we find there would be no prohibited conflict. However, the Mayor should be advised that Section 112.313(14), Florida Statutes, may prohibit his representing his engineering firm or any other person or entity for compensation before the Board of Aldermen within two years after he vacates office.