CEO 21-3—March 5, 2021
CONFLICT OF INTEREST; VOTING CONFLICT
CITY COUNCIL MEMBER'S BUSINESS SUBCONTRACTING ON CONTRACT
BETWEEN CONTRACTOR AND SHERIFF'S OFFICE
To: Kirby Oberdorfer, Deputy Director of Ethics, Compliance & Oversight (Jacksonville)
Sections 112.313(3) and 112.313(7)(a), Florida Statutes, will not give rise to a conflict of interest when a City Council Member's business acts as a subcontractor on a contract between a contractor and the Sheriff's Office. The arrangement, as presented, is not a violation of Section 112.313(6), Florida Statutes, or Article II, Section 8(g)(2), Florida Constitution. The Council Member is also provided with voting conflict guidance herein. Referenced are CEO 96-32, CEO 07-2, CEO 08-8, CEO 11-6, and CEO 18-4.
Is a prohibited conflict of interest created if the business of a City Council Member, which sells pharmacy consulting services, is subcontracted by a subcontractor to a business contracting with the Sheriff's Office?
Under the circumstances presented, this question is answered in the negative.
You write the Commission to ask whether the facts you present create a prohibited conflict of interest for a member of the City of Jacksonville City Council under the Code of Ethics for Public Officers and Employees. In your inquiry, you explain a member of the City Council is also a certified pharmacist and a certified consultant pharmacist licensed by the State of Florida Board of Pharmacy. The Council Member, you state, holds private employment in the field of pharmacy as the director of a long-term care pharmacy and the owner, director, and sole employee of a corporation (Council Member's Business) through which the Council Member performs pharmaceutical consulting work as a consulting pharmacist.1 Onsite and institutional pharmacies, you explain, are required by Section 465.019(5), Florida Statutes, to have the supervision of a consulting pharmacist.
You state that the Jacksonville Sheriff's Office (JSO) operates detention facilities that contain institutional pharmacies. JSO contracts with Armor Correctional Health Services, Inc., (Armor) to provide certain healthcare-related services, including pharmacy services, to the inmates of its detention facilities. Armor subcontracts with Diamond Pharmacy Services (Diamond) for pharmaceutical medications for the inmates. Diamond, in turn, requires the services of a consultant pharmacist to fulfill its obligations and that consultant pharmacist is managed and paid by Diamond. Diamond is contemplating a contract with Council Member's Business to fulfill the consulting pharmacist role.
If Diamond contracts with Council Member's Business to perform the work, the Council Member, as the sole employee of Council Member's Business and in his capacity as a consulting pharmacist, will be responsible for (1) ensuring all medication procedures have been followed, (2) preparing a monthly report of his activities and findings for review by Armor and JSO, and (3) preparing a quarterly report on quality improvement for review by Armor and JSO. The Council Member, as a consulting pharmacist, would not have any role in the provision of care to inmates and would not have the ability to make decisions related to medication utilization at the JSO detention facilities, including the ordering, purchasing, prescribing, and pricing of medication.
Regarding the conflict of interest question, Section 112.313(3) provides:
No employee of an agency acting in his or her official capacity as a purchasing agent, or public officer acting in his or her official capacity, shall either directly or indirectly purchase, rent, or lease any realty, goods, or services for his or her own agency from any business entity of which the officer or employee or the officer's or employee's spouse or child is an officer, partner, director, or proprietor or in which such officer or employee or the officer's or employee's 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 the officer's or employee's own agency, if he or she is a state officer or employee, or to any political subdivision or any agency thereof, if he or she is serving as an officer or employee of that political subdivision . . . 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.
The first prohibition in this statute operates to proscribe a public officer or employee in his or her public role from buying, renting, or leasing realty, goods, or services from a business entity in which the public officer, his or her spouse, or child own a material (greater than five percent) interest. The second prohibition operates to proscribe a public officer or employee in their private capacity from selling, renting, or leasing realty, goods, or services to his or her agency or any agency of his or her political subdivision.
Also, Section 112.313(7)(a) states:
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 or she 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 or her private interests and the performance of his or her public duties or that would impede the full and faithful discharge of his or her public duties.
The first clause of this statute prohibits a public officer or employee from having employment or a contractual relationship with a business entity or an agency that is regulated by or is doing business with his or her agency. The second clause of this statute prohibits a public officer or employee from having employment or a contractual relationship that would create a continuing or frequently recurring conflict of interest or that would create an impediment to the full and faithful discharge of his or her public duties.
Section 112.313(3) will not be implicated if Diamond subcontracts with Council Member's Business. Although the Council Member owns more than five percent of Council Member's Business, Council Member's Business would not be acting in a private capacity to sell, rent, or lease services to an agency of the Council Member's political subdivision—rather to Diamond, a private company. We have consistently opined in the past that "a public officer does not 'act in a private capacity' to sell to his political subdivision or an agency thereof when his company subcontracts with another company that in turn is selling services to his political subdivision or agency." CEO 08-8 and CEO 07-2.
When analyzing Section 112.313(7)(a), it is imperative to first determine what the Council Member's agency is. As we have opined in the past, the agency of a city council member is the city council. CEO 18-4 (citing CEO 96-32). If Diamond subcontracts the consulting pharmacist duties to Council Member's Business, this will not create a prohibited conflict of interest under the first clause of Section 112.313(7)(a). In that event, the Council Member would have employment with Council Member's Business, but Council Member's Business would not be doing business with his agency, the City Council of the City of Jacksonville; it would be doing business with Diamond.
We have also found a contractual relationship between a public officer or employee and a business entity or agency when no compensation directly flows from one to the other, if the public officer's or employee's professional license is used to provide the business entity or agency with a service. See, e.g., CEO 11-6. However, if a contractual relationship with JSO is found to exist for the Council Member because his professional license is being used to provide supervision to JSO institutional pharmacies, JSO is still not the Council Member's agency. Thus, the dynamic contemplated and prohibited under the first clause of Section 112.313(7)(a) is not present either way.
There is also nothing in the facts presented to indicate that a prohibited conflict of interest will be created under the second clause of Section 112.313(7)(a). The Council Member's performance as a subcontracted consulting pharmacist is distinct from his public role as a member of the City Council and would not, in our view, tempt the Council Member to dishonor his public duties. Zerweck v. State Commission on Ethics, 409 So. 2d 57 (Fla. 4th DCA 1982).
For these reasons, a prohibited conflict of interest is not created for the Council Member if Diamond subcontracts with Council Member's Business.
Question 1 is answered accordingly.
Is a voting conflict created if the City Council Member votes on the budget of the Sheriff's Office?
Under the circumstances presented, this question is answered as set forth below.
In your inquiry, you explain that the City Council reviews and approves the JSO budget, which includes funds for the JSO contract with Armor. The Council Member, in his role as a member of the City Council, expects to be presented with votes regarding the JSO budget on an annual basis.
In analyzing whether a voting conflict exists, we review Section 112.3143(3), Florida Statutes, which states:
No county, municipal, or other local public officer shall vote in an official capacity upon any measure which would inure to his or her special private gain or loss; which he or she knows would inure to the special private gain or loss of any principal by whom he or she is retained or to the parent organization or subsidiary of a corporate principal by which he or she is retained, other than an agency as defined in s. 112.312(2); or which he or she knows would inure to the special private gain or loss of a relative or business associate of the public officer. Such public officer shall, prior to the vote being taken, publicly state to the assembly the nature of the officer’s interest in the matter from which he or she is abstaining from voting and, within 15 days after the vote occurs, disclose the nature of his or her 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.
Because the budget of the JSO includes funds for the contract with Armor, any vote the Council Member takes regarding that budget will inure to his special private gain or loss as the owner of Council Member's Business, which provides services on the same contract as a subcontractor to a subcontractor of Armor. For that reason, for as long as his business is providing pharmacy consulting services on the JSO contract, the Council Member will have a voting conflict on any votes relating to the JSO budget, including a vote on the City budget if it includes the JSO budget. When those votes occur and the voting conflict is present, the Council Member must publicly state his interest in the JSO budget before the vote, abstain from voting, and file CE Form 8B, "Memorandum of Voting Conflict for County, Municipal, and Other Local Public Officers," within 15 days of the vote with the person responsible for recording the minutes of the meeting. However, the Council Member is advised that separating the City budget vote into different votes so that he can abstain from voting on any portion of the budget containing funding for pharmacy consulting services, which is the source of his voting conflict, will then allow him to vote on the remainder of the City budget.
Your question is answered accordingly.2
ORDERED by the State of Florida Commission on Ethics meeting in public session on March 5, 2021, and RENDERED this 10th day of March, 2021.
LoAnne Leznoff, Chair
The legal obligations of a consultant pharmacist are detailed in Section 465.0125, Florida Statutes.
With reference to the "misuse of position" statute (Section 112.313(6), Florida Statutes) and the "abuse to obtain a disproportionate benefit" Constitutional provision (Article II, Section 8(g)(2), Florida Constitution), we find that the facts before us do not indicate a misuse of position or an abuse to obtain a disproportionate benefit. We do not identify any use, misuse, or abuse of the Council Member's public office or the resources of his office.