CEO 82-37 -- May 20, 1982

CONFLICT OF INTEREST

DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES EMPLOYEE SERVING ON BOARD OF DIRECTORS OF NONPROFIT CORPORATION

To: Mr. Walter Carfora, Chairman of the Board of Carlton Manor, Inc., St. Petersburg

SUMMARY:

No prohibited conflict of interest would be created were a District Intake Counselor employed by District V, Network II, Department of Health and Rehabilitative Services, to serve as a member of the Board of Directors of a nonprofit corporation which is contracting with the District Mental Health Board to operate a residential treatment home for troubled and delinquent teenage boys. Here, the nonprofit corporation would not be selling any services to the employee's agency, which is Network II. See CEO 81-2 and CEO 78-50. Nor would the employee have an employment or contractual relationship with the nonprofit organization which could form the basis for a prohibited conflict of interest, since noncompensated service as a member of the board of directors of a nonprofit corporation does not constitute an employment or contractual relationship with that entity. See CEO 80-22.

QUESTION:

Would a prohibited conflict of interest be created were a District Intake Counselor employed by District V, Network II, Department of Health and Rehabilitative Services, to serve as a member of the board of directors of a nonprofit corporation which is contracting with the District Mental Health Board to operate a residential home for troubled and delinquent teenage boys?

Your question is answered in the negative.

In your letter of inquiry you advise that Mr. Arthur Bruno is a District Intake Counselor for Network II, District V, of the Department of Health and Rehabilitative Services (D.H.R.S.). In that position, he is responsible for providing screening, investigation, case work, and counseling services to children alleged to be delinquent or dependent.

You also advise that Mr. Bruno has been asked to serve in a noncompensated position on the board of directors of a nonprofit corporation which operates a residential home for troubled and delinquent teenage boys. This organization is funded principally by Pinellas County and by the District Mental Health Board, you advise. The Mental Health Board has contracted with the Mental Health and Children, Youth, and Families Program Offices of the District.

The Code of Ethics for Public Officers and Employees provides:

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), F. S.]

This provision would prohibit the subject employee from having any employment or contractual relationship with a business entity which is doing business with his agency. However, as we have advised in previous opinions, noncompensated service as a member of the board of directors of a nonprofit corporation does not constitute an employment or contractual relationship with that entity. See, for example, CEO 82-22.

The Code of Ethics also provides:

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), F. S.]

This provision prohibits the subject employee from acting in a private capacity to sell any service to his agency. We have advised that being a director of a corporation selling services to an agency constitutes "acting in a private capacity" to sell to that agency within the meaning of Section 112.313(3). See CEO 76-12. Therefore, the subject employee is prohibited from serving as a director of a business entity which is selling any services to his "agency." Under the circumstances you have presented, it appears that his "agency" is Network II of District V. See CEO 81-2 and CEO 78-50. However, here the nonprofit corporation is contracting with and selling its services to the District Mental Health Board -- not to Network II. Therefore, Section 112.313(3) is inapplicable.

Accordingly, we find that no prohibited conflict of interest would be created were the subject D.H.R.S. employee to serve as a member of the board of directors of the nonprofit corporation while it contracts with the District Mental Health Board to operate a residential home for troubled and delinquent teenage boys. However, we would caution the subject employee to avoid misusing his public position, or even the appearance of misuse of his position, to benefit the nonprofit corporation while serving as a director, in light of the following provisions of the Code of Ethics:

MISUSE OF PUBLIC POSITION. -- No public officer or employee of an agency shall corruptly use or attempt to use his official position or any property or resource which may be within his trust, or perform his official duties, to secure a special privilege, benefit or exemption for himself or others. This section shall not be construed to conflict with s. 104.31. [Section 112.313(6), F. S.]