CEO 76-167 -- September 13, 1976

CONFLICT OF INTEREST

STATE SENATOR OWNER OF MATERIAL INTEREST IN BUSINESS SELLING TO STATE AGENCIES

To: (Name withheld at the person's request.)

Prepared by: Gene Rhodes

SUMMARY:

The Code of Ethics prohibits a state officer from acting in a private capacity to sell any realty, goods, or services to his own agency. Fla. Stat. s. 112.313(3)(1975). The term "agency," however, is defined to include any state government entity and any department, division, bureau, commission, authority, or political subdivision therein. Fla. Stat. s. 112.312(2)(1975). Accordingly, a state senator's agency is the Florida Legislature, and thus he is not prohibited from selling to other agencies of state government. Also, although s. 112.313(7)(a) prohibits a public officer from having a contractual relationship with any agency subject to the regulation of his agency, subparagraph (7)(a)2. thereof exempts from such prohibition members of legislative bodies whose regulatory power is strictly through the enactment of laws.

QUESTION:

Would a prohibited conflict of interest be created were I, a state senator, to purchase a material interest in a business that sells merchandise to state agencies?

This question is answered in the negative.

Your letter of inquiry advises us that you have opportunity to purchase a material interest in a business that sells merchandise to various state agencies. This business does not sell to the Florida Legislature, however.

The Code of Ethics for Public Officers and Employees provides in relevant part:

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. . . . [Fla. Stat. s. 112.313(3)(1975); emphasis supplied.]

The italicized language above prohibits a state officer from acting in a private capacity to sell goods to his own agency. We have previously determined that ownership of a material interest in a business entity constitutes acting in one's private capacity to sell where that business sells. See CEO 75-196. Pursuant to Florida Statute s. 112.312(2)(1975), however, your agency is the Florida Legislature, thus rendering the above-quoted prohibition inapplicable to your situation.

The Code of Ethics further provides as follows:

CONFLICTING EMPLOYMENT OR CONTRACTUAL RELATIONSHIP. --

(a) 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 . . . .

* * * * *

2. When the agency referred to is a legislative body and the regulatory power over the business entity resides in another agency, or when the regulatory power which the legislative body exercises over the business entity or agency is strictly through the enactment of laws or ordinances, then employment or a contractual relationship with such business entity by a public officer or employee of a legislative body shall not be prohibited by this subsection or be deemed a conflict. [Fla. Stat. s. 112.313(7)(a)(1975); emphasis supplied.]

This section prohibits a public officer from having a contractual relationship with a business entity subject to the regulation of his public agency. However, the italicized language above exempts members of legislative bodies from the prohibition where the regulatory power exercised over a business entity is strictly through the enactment of laws. As the Florida Legislature regulates businesses in the state strictly through the enactment of laws, you are not prohibited by the Code of Ethics from purchasing a material interest in the above-described business.