CEO 01-3 -- January 30, 2001
SUNSHINE AMENDMENT
STATE REPRESENTATIVE CONTACTING FLORIDA HOUSING FINANCE CORPORATION STAFF ABOUT ITS PROGRAMS' RULES AND AVAILABILITY OF PROJECT FUNDING
To: Name withheld at person's request (District 23,Gainesville)
SUMMARY:
As a result of the Legislature's adoption of Section 420.5061, Florida Statutes, which expressly provides that for purposes of the prohibitions of Section 112.313, Florida Statutes, the Florida Housing Finance Corporation is a continuation of the Florida Housing Finance Agency, the Corporation's predecessor, and since this Commission previously determined that the Florida Housing Finance Agency was a "state agency" for purposes of Article II, Section 8(e), Florida Constitution, both Article II, Section 8(e), Florida Constitution, and Section 112.313(9)(a)3, Florida Statutes, prohibit you from personally contacting staff of the Florida Housing Finance Corporation on behalf of your development company for information about its programs' rules or for advice on completing funding applications.
QUESTION:
Do the Sunshine Amendment's and Code of Ethics' prohibitions against a legislator personally representing a person or entity for compensation before any state agency during his or her term of office prohibit you, a State Representative, from contacting staff of the Florida Housing Finance Corporation on behalf of your development company for information about its programs' rules or for advice on completing funding applications?
Your question is answered in the affirmative.
In your letter of inquiry, you advise that prior to your election to the Florida House of Representatives ("House"), you periodically contacted the Florida Housing Finance Corporation ("Corporation") on behalf of Jennings Development Group, Inc., which the Secretary of State's Division of Corporation's records indicate you are the sole officer and director of, regarding various affordable housing projects, the financing of which was provided through the Corporation. We are advised that your contacts with the Corporation generally consisted of your seeking clarification from Corporation staff about the various programs' rules and funding opportunities under each program administered by the Corporation. Having been elected to the House, you are now concerned about the extent to which the Sunshine Amendment (Article II, Section 8(e), Florida Constitution) and its statutory companion, Section 112.313(9)(a)3, Florida Statutes, prohibit you from contacting the Corporation's staff either for information or for advice on completing funding (grant) applications.
You note that the Corporation was created pursuant to Section 420.504(1), Florida Statutes, as a "public corporation and a public body corporate and politic," within the Department of Community Affairs. However, Section 420.504, Florida Statutes, you write, further provides that the Corporation is "not a department of the executive branch of state government within the scope of, and meaning of, s. 6, Art. IV of the State Constitution[1], but is functionally related to the Department of Community Affairs." You note further that according to Section 420.504(2), Florida Statutes, the Corporation is an "agency" for purposes of Section 120.52, Florida Statutes (relating to the Florida Administrative Procedures Act), and, with certain exceptions, is subject to the requirements of Chapter 119, Florida Statutes (relating to the Public Records or Sunshine Law), and Chapter 286, Florida Statutes (relating to Open Meetings). However, with the exception of the requirement that members of the Corporation's Board of Directors file full and public disclosure of financial interests (CE Form 6) in the same manner as elected constitutional officers under Article II, Section 8, Florida Constitution, the statute, you write, is silent as to whether the Corporation is an "agency" for purposes of the application of the conflict of interest provisions of the Code of Ethics.
You also note that while the Legislature appropriates funds to the Corporation, it does not control the number of employees or the salary rate for such employees. For example, you indicate that some of the employees who were transferred to the Corporation remained State employees.[2] However, new hires are not. We also note that, while the Corporation is authorized to prepare and submit a budget request to the Secretary of the Department of Community Affairs, which includes requests for operational expenditures and separate requests for other authorized Corporation programs, the Corporation specifically is exempted from the statutory requirement of having to provide information on the number of its employees, their salaries, or any classification thereof. Section 420.507(30), Florida Statutes. Therefore, in light of the definition of "state agency" at Section 112.313(9)(a)2.c, Florida Statutes,[3] you suggest that the appropriation of funds by the Legislature to the Corporation without greater legislative controls over its expenditures does not constitute the exercise of "plenary budgetary control" over the Corporation for purposes of determining that the Corporation is a "State agency" as that term is used in Article II, Section 8(e), Florida Constitution, and Section 112.313(9)(a)3, Florida Statutes, which provide respectively as follows:
SECTION 8. ETHICS IN GOVERNMENT.--A public office is a public trust. The people shall have the right to secure and sustain that trust against abuse. To assure this right:
(e) No member of the legislature or statewide elected officer shall personally represent another person or entity for compensation before the government body or agency of which the individual was an officer or member for a period of two years following vacation of office. No member of the legislature shall personally represent another person or entity for compensation during term of office before any state agency other than judicial tribunals. Similar restrictions on other public officers and employees may be established by law. [E.S.] [Article II, Section 8(e), Florida Constitution.]
POSTEMPLOYMENT RESTRICTIONS; STANDARDS OF CONDUCT FOR LEGISLATORS AND LEGISLATIVE EMPLOYEES.--No member of the Legislature, appointed state officer, or statewide elected officer shall personally represent another person or entity for compensation before the government body or agency of which the individual was an officer or member for a period of 2 years following vacation of office. No member of the Legislature shall personally represent another person or entity for compensation during his or her term of office before any state agency other than judicial tribunals or in settlement negotiations after the filing of a lawsuit. [E.S.] [Section 112.313(9)(a)3, Florida Statutes.]
These provisions prohibit a legislator from personally representing an entity for compensation before any State agency other than judicial tribunals during his or her term of office. The purpose behind the constitutional prohibition was expressed by the Florida Supreme Court in Myers v. Hawkins,[4] 362 So.2d 926, 930 (Fla. 1978), where the Court stated:
[W]e are always obliged to interpret a constitutional term in light of the primary purpose for which it has been adopted. Both Myers and the amici recognize that the Sunshine Amendment was evolved to establish an arsenal of protections against the actual and apparent conflicts of interest which can arise among public officials, and that Section 8(e) was designed specifically to prevent those who have plenary budgetary and statutory control over the affairs of public agencies from potentially influencing agency decisions (or giving the appearance of having influence) when they appear before the agencies as compensated advocates for others. [Emphasis added.]
In In re George Stuart, COE Final Order 94-01, 16 FALR 1499, 1505-1506 (COE 1994), we similarly were faced with the question of whether the agency that Senator Stuart was lobbying, the Orlando-Orange County Expressway Authority, was a "state agency" for purposes of Article II, Section 8(e), Florida Constitution, and Section 112.313(9)(a)3, Florida Statutes. We found that it was a "state agency" and that Senator Stuart had violated Article II, Section 8(e). In contrast, here, because of the statutory language employed by the Legislature in creating the Corporation, our analysis of the issues involved appears to be simpler.
Initially, we note that in CEO 82-33, we determined that the Florida Housing Finance Agency ("FHFA"), the Corporation's predecessor, was a "state agency" for purposes of applying Article II, Section 8(e), and was not a judicial tribunal. However, when the Legislature abolished the FHFA and recreated it as the Florida Housing Finance Corporation, a public corporation [See Section 7, Chapter 97-167, Laws of Florida, and Section 420.504, Florida Statutes (1997)], it provided:
PUBLIC CORPORATION; CREATION, MEMBERSHIP, TERMS, EXPENSES.--
(1) There is created within the Department of Community Affairs a public corporation and a public body corporate and politic, to be known as the "Florida Housing Finance Corporation." It is declared to be the intent of and constitutional construction by the Legislature that the Florida Housing Finance Corporation constitutes an entrepreneurial public corporation organized to provide and promote the public welfare by administering the governmental function of financing or refinancing housing and related facilities in Florida and that the corporation is not a department of the executive branch of state government within the scope and meaning of s. 6, Article IV of the State Constitution, but is functionally related to the Department of Community Affairs in which it is placed. The executive function of state government to be performed by the secretary of the department in the conduct of the business of the Florida Housing Finance Corporation must be performed pursuant to a contract to monitor and set standards as provided in s. 420.0006. . . .
(2) The corporation is constituted as a public instrumentality, and the exercise by the corporation of the power conferred by this act is considered to be the performance of an essential public function. The corporation is subject to chapter 119, subject to exceptions applicable to the corporation, and to the provisions of chapter 286. . . .
(3) The corporation is a separate budget entity and is not subject to control, supervision, or direction by the Department of Community Affairs in any manner, including but not limited to, personnel, purchasing, transactions involving real or personal property, and budgetary matters. The corporation shall consist of a board of directors composed of a Secretary of Community Affairs as an ex officio and voting member and eight members appointed by the Governor subject to confirmation by the Senate from the following: . . .
. . . . .
(7) Each member of the board of directors of the corporation shall file full and public disclosure of financial interests at the times and places and in the same manner required of elected constitutional officers under s. 8, Art. II of the State Constitution an any law implementing s. 8, Art. II of the State Constitution.
(8) The corporation is a corporation primarily acting as an instrumentality of the state, within the meaning of s. 768.28. [E.S.]
In In re George Stuart, we accepted the Administrative Law Judge's observation that "an agency may assume a legal character based upon the particular statutory or regulatory background against which it is examined." 16 FALR at 1504. For example, in determining whether the Commission on Hispanic Affairs was a "state agency," the Attorney General, in AGO 80-29, opined that the Commission may not be considered a state agency for certain purposes, such as planning and budgeting (Chapter 216, Florida Statutes) or purchasing (Chapter 287, Florida Statutes), nor an executive department or agency for governmental reorganization purposes, but may be for other purposes. Thus, it ordinarily would be incumbent upon us to examine a governmental entity's statutory framework in order to determine whether it is a "state agency" for purposes of Article II, Section 8(e), Florida Constitution, and Section 112.313(9)(a)3, Florida Statutes.
Our examination of the Corporation's statutory framework leads us to conclude, as you did, that the Legislature clearly intended that the Corporation be constituted as an "agency" for purposes of Section 120.52 and, with certain limitations, for purposes of Chapters 119 and 286, Florida Statutes. However, unlike our determination in In re George Stuart that there was no reason to differentiate between the terms "state agency" and "agency of the state" for purposes of Article II, Section 8(e), Florida Constitution,[5] in its recreation of the FHFA as a public corporation in Chapter 420, Florida Statutes, the Legislature also describes the Corporation as acting as an "instrumentality of the state" for purposes of Section 768.28, Florida Statutes, that is, for purposes of the application of the State's limited waiver of immunity from lawsuit, and as a "public instrumentality" which serves an "essential public function."[6]
However, regardless of how the Corporation is characterized in Chapter 420, we do not believe that it is necessary for us to determine here whether the Legislature intended to differentiate between the terms "state agency" and "public instrumentality" and "instrumentality of the State" for purposes of Article II, Section 8(e), Florida Constitution, and Section 112.313(9)(a)3, Florida Statutes. We also do not believe that we need to determine here whether the Corporation performs an essential governmental function and behaves like a State agency, whether compelling public policy reasons exist to consider the Corporation to be a "state agency" for purposes of Article II, Section 8(e), or whether the Legislature's appropriation of $173,671,276 from the State Housing Trust Fund[7] to the Corporation constitutes "plenary budgetary control" for purposes of Article II, Section 8(e) of the Florida Constitution, and Section 112.313(9)(a)3, Florida Statutes, among the issues previously looked at by the courts, the Attorney General, and this Commission in determining the status of statutorily created entities.[8]
Since we previously determined that the FHFA was a "state agency" for purposes of Article II, Section 8(e), and since there can be no question that the Legislature exercised "plenary budgetary and statutory control" over the FHFA for purposes of Section 112.313(9)(a)3, Florida Statutes, we find that, as a result of the Legislature's adoption of Section 420.5061, Florida Statutes,[9] which expressly provides that for purposes of the prohibitions of Section 112.313, Florida Statutes, the Corporation is a continuation of the "agency," we find that the constitutional and statutory prohibitions against a legislator personally representing another person or entity for compensation before any state agency other than a judicial tribunal are clearly applicable.
Accordingly, we find that both Article II, Section 8(e), Florida Constitution, and Section 112.313(9)(a)3, Florida Statutes, prohibit you from personally contacting staff of the Florida Housing Finance Corporation on behalf of your development company for information about its programs' rules or for advice on completing funding applications. However, we also are of the opinion that your company would be permitted to seek a grant or to pursue funding opportunities from the Corporation so long as you do not personally represent the company before the Corporation.[10] You should note that the term "represent" as defined in Section 112.312(22), Florida Statutes, means "actual physical attendance on behalf of a client in an agency proceeding, the writing of letters or filing of documents on behalf of a client, and personal communications made with the officers or employees of any agency on behalf of a client."
ORDERED by the State of Florida Commission on Ethics meeting in public session on January 25, 2001 and RENDERED this 30th day of January, 2001.
___________________________________
Howard Marks
Chair
[1]Article IV, Section 6, Florida Constitution, provides that "the functions of the executive branch of state government shall be allotted among not more than 25 departments, exclusive of those specifically provided for or authorized in [the] constitution."
[2]Section 420.506, Florida Statutes, authorizes the Corporation to enter into a lease agreement with the Department of Management Services or the Department of Community Affairs for the lease of state employees. Under this arrangement, the employee would retain his or her status as a state employee, as well as his or her right to participate in the Florida Retirement System. However, he or she would work under the direct supervision of the Corporation.
[3]"State agency" is defined at Section 112.313(9)(a)2.c, Florida Statutes, to mean
an entity of the legislative, executive, or judicial branch of state government over which the legislature exercises plenary budgetary and statutory control.
[4]Myers v. Hawkins, 362 So.2d 926, 930 (Fla. 1978), was an appeal brought by Senator Myers of a declaratory statement issued by the State Public Service Commission ("PSC")stating that, pursuant to the Sunshine Amendment, he was prohibited from practicing before the PSC. In quashing the PSC's order, the Supreme Court ruled as follows: (1) An affected agency is not the appropriate body to make a determination of its own status under Article II, Section 8(e), only the Ethics Commission should make those determinations; (2) the term "judicial tribunals" in Article II, Section 8(e) includes judges of industrial claims, the Industrial Relations Commission, and all courts of the state created under Article V of the Constitution. (The PSC is not a "judicial tribunal" -- the exercise by it of its judicial-like powers constitutes only a fraction of its duties.); and (3) Article II, Section 8(e) does not apply to affected legislators and statewide elected officers who held office on its effective date. (Senator Myers was not barred from practicing before the PSC during his senatorial term which began prior to the effective date of Article II, Section 8(e), Florida Constitution.)
[5]See In re George Stuart, 16 FALR at 1504.
[6]See Sections 420.504(2) and (7), Florida Statutes.
[7]See Section 5, Specific Appropriations 1458 - 1462, of Chapter 2000-166, Laws of Florida.
[8]See Kuvin, Klingensmith, and Lewis, P.A. v. Florida Insurance Guaranty Association, Inc., 371 So. 2d 214 (Fla. 3d DCA 1979) (Finding that the Florida Insurance Guaranty Association, Inc. was not a "governmental entity" entitled to the venue privilege of being served only at the site of its headquarters.); Prison Rehabilitative Industries & Diversified Enterprises, Inc. v. Betterson, 648 So.2d 778 2 (Fla. 1st DCA 1994), reh. denied, Feb. 9, 1995 (PRIDE is an "agency of the State" subject to the Section 768.28, Florida Statutes.); AGO 78-106 (HRS District Mental Health Boards may be deemed to be "state agencies or subdivisions" within the definitional purview of s. 768.28(5), Florida Statutes.); CEO 87-43 (Florida Joint Underwriting Association is not a "government entity."); and CEO 94-7 (Tri-County Commuter Rail Authority is not an executive branch agency for purposes of Section 112.3215, Florida Statutes.)
[9]Section 420.5061, Florida Statutes, which relates to the transfer of FHFA assets and liabilities to the Corporation, provides as follows:
TRANSFER OF AGENCY ASSETS AND LIABILITIES.--Effective January 1, 1998, all references under Florida law to the agency are deemed to mean the corporation. The corporation shall transfer to the General Revenue Fund an amount which otherwise would have been deducted as a service charge pursuant to s. 215.20(1) if the Florida Housing Finance Corporation Fund established by s. 420.508(5), the State Apartment Incentive Loan Fund established by s. 420.5087(7), the Florida Homeownership Assistance Fund established by s. 420.5088(5), the HOME Investment Partnership Fund established by s. 420.5089(1), and the Housing Predevelopment Loan Fund established by s. 420.525(1) were each trust funds. For purposes of s. 112.313, the corporation is deemed to be a continuation of the agency, and the provisions thereof are deemed to apply as if the same entity remained in place. Any employees of the agency and agency board members covered by s. 112.313(9)(a)6. shall continue to be entitled to the exemption in that subparagraph, notwithstanding being hired by the corporation or appointed as board members of the corporation. Effective January 1, 1998, all state property in use by the agency shall be transferred to and become the property of the corporation. [E.S.]