CEO 00-12 -- August 29, 2000

CONFLICT OF INTEREST

COUNTY COMMISSIONER OBTAINING S.H.I.P. FUNDING THROUGH COUNTY DEPARTMENT TO REHABILITATE LOW-COST HOUSING

To: Name withheld at person's request (Bradenton)

SUMMARY:

A prohibited conflict of interest would be created under Section 112.313(7)(a), Florida Statutes, where a county commissioner obtains funding through a county program to rehabilitate duplexes that will provide affordable housing to low-income individuals. The commissioner would have a contractual relationship with an agency--the community services department--that is overseen by the county commission. CEO's 98-3, 90-76, 88-52, and 77-88 are referenced.

QUESTION:

Is a prohibited conflict of interest created where a county commissioner applies to participate in a housing assistance program to rehabilitate rental property that will provide affordable housing to low-income individuals, where the program is administered by the county?

Your question is answered in the affirmative.

From your opinion request and materials submitted along with it, we are advised that you serve as a member of the Manatee County Board of County Commissioners and that you privately purchased fourteen duplexes that are boarded-up, vacant, and need repairs in order to be habitable. After learning of the County's participation in the State Housing Assistance Program (SHIP), which is administered by the Manatee County Community Development Department, you met with County staff to determine whether there might be funding available to rehabilitate your properties. You write that you were advised by County staff that your project would qualify for funding, and you subsequently submitted an application to receive $135,500 to rehabilitate the duplexes. If the County provided the funding, under the terms of the program you would make the repairs and be obligated for fifteen years to rent the units to low-income individuals. Approval of the specific amount would come before the County Commission and, you acknowledge, would require your abstention from voting. However, you question whether your participation in the County program itself would create a conflict of interest prohibited by the Code of Ethics for Public Officers and Employees.

The primary provision of the Code of Ethics which is applicable to your inquiry is Section 112.313(7)(a), Florida Statutes, which 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 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. [Section 112.313(7)(a), Florida Statutes (1997).]

Section 112.313(7)(a) prohibits a public officer from having a contractual relationship with a business entity or agency that is doing business with or regulated by his agency. It also prohibits the public officer from having a contractual relationship which creates a continuing or frequently recurring conflict between his private interests and the performance of his public duties, or which impedes the full and faithful discharge of his public duties.

In CEO 77-88, we opined that a prohibited conflict of interest would be created where a county commissioner entered into a contractual relationship with a county housing assistance office as a landlord in the federal HUD Section 8 housing assistance payments program. That situation violated the first part of Section 112.313(7)(a), we concluded, since he would have a contractual relationship with a county agency that was regulated by the board of county commissioners. In CEO 88-52, we applied the second part of Section 112.313(7)(a) to conclude that it would create a prohibited conflict of interest if a city employee applied for a rental rehabilitation loan through the program in which he worked. We believed that his participation in the rental rehabilitation program created an impediment to the full and faithful discharge of his public duties, as he was directly involved in the administration of the program under which he would obtain the loan, he was competing with other applicants for loan proceeds, and the loan would clearly benefit him by enabling him to rehabilitate his property.

In the situation you have described, there are factual similarities with both CEO 77-88 and CEO 88-52. Like CEO 77-88, the Manatee County Community Services Department is a County agency. If you obtain the funding, you would have a contractual relationship with an agency that is subject to the County Commission's oversight. As in CEO 88-52, there is competition for the funding, and the funding would clearly benefit you by allowing you to make much-needed repairs in the fourteen duplexes and then rent them. The funding is awarded on a first-come, first-served basis and, we are advised, is fully committed as a result of your application and that of other homeowner-applicants.

In another opinion--CEO 98-3--we opined that Section 112.313(7)(a) would be violated where a community redevelopment agency board member applied for a low-cost loan administered by his agency. That opinion cited CEO 88-52, as well as CEO 90-76, to conclude that a prohibited conflict of interest was created where a public officer applied for funding through a program administered by his agency and that "to hold otherwise would provide the opportunity and strongly suggest to the public that a public officer is permitted to benefit privately because of his public position, which is antithetical to the principles underlying the Code of Ethics for Public Officers and Employees."

Accordingly, Section 112.313(7)(a) would be violated where a county commissioner obtains housing rehabilitation funding from a program administered by the county.

ORDERED by the State of Florida Commission on Ethics meeting in public session on August 24, 2000 and RENDERED this 29th day of August.

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Howard Marks, Chair