CEO 01-15 -- July 31, 2001

CONFLICT OF INTEREST

COUNTY COMMISSIONER EMPLOYED AS OUTSIDE CONSULTANT BY ENGINEERING FIRM SELECTED TO WORK ON COUNTY PROJECTS PURSUANT TO CONSULTANT'S COMPETITIVE NEGOTIATION ACT

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

SUMMARY:

A prohibited conflict of interest would be created under Section 112.313(7)(a), Florida Statutes, were a County Commissioner to work as an outside engineering consultant on non-County projects for an engineering firm which has been selected pursuant to Section 287.055, Florida Statutes, the Consultants' Competitive Negotiation Act ("CCNA"), to work on a County project. Because the County's adherence to the requirements of the CCNA means that it selects qualified engineering firms from both within and without the County, rather than solely from within the County, and because, rather than distributing the County's professional engineering work to qualified firms located in the County in accordance with a rotation list of all qualified engineering firms located in the County, the County selects three of the most qualified firms using a set of selection criteria, the County's selection of a professional engineering firm pursuant to the CCNA is not the equivalent of the County's use of a rotation list of providers/vendors located within the County for its purchase of goods and services, an exemption provided in Section 112.313(12)(a), Florida Statutes.

QUESTION:

Would a prohibited conflict of interest be created were you, a County Commissioner, to work as an outside engineering consultant on non-County projects for an engineering firm which has been selected pursuant to Section 287.055, Florida Statutes, the CCNA, to work on a County project?

Your question is answered in the affirmative.

In your letter of inquiry, you advise that you are both a Florida licensed Professional Engineer and a member of the Martin County Board of County Commissioners, having been elected to the County Commission during the September 2000 primary elections. You also relate that prior to taking office you were employed by Martin County as a "government engineer." You had no "pre-existing outside contractual relationships," you advise. Now, however, you would like to be able to work as an outside engineering consultant on non-Martin County projects for an engineering firm that has been selected pursuant to Florida's Consultant's Competitive Negotiation Act ("CCNA"), Section 287.055, Florida Statutes, to work on County projects, without violating the Code of Ethics. Therefore, you ask whether the exemption of Section 112.313(12)(a), Florida Statutes, relative to business transacted within a city or county through a system of rotation among all qualified suppliers of the goods or services within the city or county, would negate the prohibitions of Section 112.313(7)(a), Florida Statutes.

In response to questions posited by our staff, you have advised that professional engineering firms become "qualified" by Martin County and listed on the County's "approved" list of consultant engineers through the County's strict adherence to the procedures and guidelines outlined in the CCNA. You also indicate that the County's engineering work is distributed among the "qualified" firms based upon the selection factors listed within the CCNA. You were unable to indicate how many of the engineering firms that have been qualified by County are located within the County or where the engineering firms that actually have contracted with the County are located. However, you did indicate that you would like to perform consultant engineering work on non-Martin County project for engineering firms located both within and outside of Martin County.

In a telephone conversation with our staff, you advised that for each County project for which engineering services are announced under the CCNA, the County Administrator appoints a selection committee consisting of four to seven County employees. The selection committee reviews the qualification statements on file with the County and received from firms in response to the announcement; for larger projects the selection committee also may interview firms. The committee then provides to the County Commission a list of no fewer than three firms, ranked in order of preference, that are deemed to be the most highly qualified to perform the required services. The County Commission reviews the list and can approve, disapprove, or revise the rankings, and may add and rank additional firms onto the list. County staff then begins negotiations with the highest-ranked firm; if those negotiations do not result in a satisfactory contract, negotiations begin with the second-ranked firm, and so forth.

The sections of the Code of Ethics for Public Officers and Employees applicable to your inquiry provide:

DOING BUSINESS WITH ONE'S AGENCY.--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. 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.

[Sec. 112.313(3), Florida Statutes.]

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.]

Unless one of the exemptions of Section 112.313(12) apply, Section 112.313(3) prohibits you from acting in your official capacity, as a public officer, to purchase professional engineering services for the County, from a business entity of which you, your spouse, or child, are an officer, partner, director, or proprietor, or in which you, your spouse or child owns more than a five percent interest, and from selling or leasing any realty, goods, or services to your agency in your private capacity. We have repeatedly said that one is deemed to be acting in his or her official capacity to purchase or lease goods, services, or realty when a body or board of which he or she is a member acts to purchase or lease such goods, services, or realty. See CEO 76-213 and CEO 95-13. We also repeatedly have found that one is deemed to be "acting in a private capacity" to sell or lease goods, services, or realty to his or her agency or political subdivision when a corporation of which he or she is an officer or a director, or in which he or she owns a material interest, sells or leases to his or her agency. See, for example, CEO 82-51 and CEO 95-13. Nevertheless, because you have not indicated that you or your spouse or child is an officer, partner, director, or proprietor of the professional engineering firm with which you would be contracting or that you or your spouse or child hold a material interest in the engineering firm, we find that Section 112.313(3) is not implicated.

Unless one of the exemptions of Section 112.313(7)(a), Florida Statutes, are applicable, Section 112.313(7)(a) prohibits you from having an employment or contractual relationship with a business entity if it is doing business with or is subject to the regulation of the County Commission, or if it creates a continuing or frequently recurring conflict between your private interests and the performance of your public duties or an impediment to the full and faithful discharge of your public duties.

For example, in CEO 81-28, we found that a prohibited conflict of interest would be created were a county commissioner to be employed as a salesman by an engineering firm doing business with the county. We found that the Section 112.313(12)(b) "competitive bid" exemption would not apply because the selection of consulting engineering firms by the county was handled under the CCNA. Similarly, in CEO 82-65 (Question 3), we found that Section 112.313(7)(a) would be violated were a county commissioner who was secretary-treasurer, a director, and a stockholder in her husband's engineering firm, to continue to hold those positions while her husband's engineering firm did business with the county. In CEO 87-7, we also found that Section 112.313(7)(a) would be violated were an erosion district commissioner to contract to provide consulting services to an engineering firm which, at the time, was under contract with the district. Finally, in CEO 94-8, we opined that absent the applicability of an exemption under Section 112.313(12), a prohibited conflict of interest under Section 112.313(7)(a) would be created were an engineering firm which employs the town's mayor to contract with the town to provide engineering services.

The exemption that you have inquired about is Section 112.313(12)(a), which creates an exemption to the prohibitions of Sections 112.313(3) and 112.313(7) where:

[w]ithin a city or county the business is transacted under a rotation system whereby the business transactions are rotated among all qualified suppliers of the goods or services within the city or county.

This exemption would permit the professional engineering firm which you contract with or are employed by to sell its services to the County, if the County's purchase of professional engineering services are rotated among all qualified suppliers of engineering services in the County. For example, in CEO 89-64, we opined that if a county purchases auto parts on a rotating basis from all qualified suppliers in the county, Section 112.313(12)(a) would apply and the county's purchase of auto parts from an auto parts store owned by a county commissioner would not be prohibited.

On the other hand, in CEO 79-17 we found that Section 112.313(12)(a) did not apply where business was rotated only among those suppliers who had expressed an interest in providing the service, and CEO 90-3 in which we opined that Section 112.313(12)(a) did not apply where the decision as to which temporary service to use was made in each case by transportation authority staff, and only three or four of the suppliers within the authority's jurisdiction were used, rather than all qualified suppliers of temporary help services. Then in CEO 96-23 we found that Section 112.313(12)(a) did not apply where the city's policy of including "the volume of current and prior work performed for using agencies" was but one of the ten selection criteria used by city staff in the city's purchase of bond underwriting services. Although we found that the City's use of that criteria tended to distribute the bond underwriting business among firms within the city, we also found that the city's purchasing criteria did not truly result in the "rotation system" among "all qualified suppliers," as was contemplated by the Legislature. For example, instead of knowing when each firm would be serving as senior manager or co-manager for an upcoming bond issue, the amount of business done with an underwriter was only one of ten criteria to be evaluated with the Mayor retaining the discretion to approve or not to approve the city's evaluation committee's recommendation.

Consequently, in order for Section 112.313(12)(a) to apply to negate the Section 112.313(7)(a) prohibition against your contracting with a professional engineering firm doing business with the county, we are of the opinion that all qualified professional engineering firms in the County would have to be included on the rotation list. Moreover, we find that all of the County's professional engineering work would have to rotated among all of the qualified engineering firms within the County.

You question whether engineering firms selected by the County pursuant to the requirements of the CCNA to provide engineering services qualify for the Section 112.313(12)(a) exemption. Section 287.055, Florida Statutes, the CCNA, sets forth the requirements for procuring and contracting the services of architects, professional engineers, landscape architects, and registered land surveyors. Under the act, an agency, including a county, must competitively select and negotiate with the most qualified firms to provide these professional services for a project. See, AGO 88-54 and AGO 96-52.

The act creates a two-step process for agencies or political subdivisions to use. The first is competitive selection, the second is competitive negotiation. City of Jacksonville v. Reynolds, Smith & Hills, Architects, Engineers & Planners, Inc., 424 So. 2d 63, 64 (Fla. 1st DCA 1982). It should be noted that the Legislative intent in establishing competitive negotiations for the procurement of services, as expressed at Section 287.001, Florida Statutes, is to "further open competition which is a basic tenet of public procurement; to reduce the appearance and opportunity for favoritism; and to ensure that contracts are awarded equitably and economically." City of Lynn Haven v. Bay County Council of Registered Architects, Inc., 528 So. 2d 1244, 1246 (Fla. 1st DCA 1988).

Thus, Section 287.055(3), Florida Statutes, requires the County to follow certain public announcement and qualification procedures when professional engineering services are needed. Section 287.055(4), Florida Statutes, generally requires an evaluation of engineering firms offering to provide such professional services and a selection of no fewer than three firms deemed to be the most highly qualified to perform the required services. Section 287.055(5), Florida Statutes, sets forth the procedure for competitive negotiation of a contract for the required services, while the remainder of Section 287.055 provides prohibitions against certain acts, statements of applicability with respect to certain projects or contracts, and a rule of construction with respect to certain other statutory provisions. See AGO 2001-03.

Because the County's adherence to the requirements of the CCNA means that it selects qualified engineering firms for the provision of professional engineering services from both within and without the County, rather than from just within the County as contemplated by Section 112.313(12)(a), and because, rather than distributing the County's professional engineering work to qualified firms located in the County pursuant to a system of rotation of all qualified engineering firms located in the County, the County selects three of the most qualified firms using a set of criteria only one of which is a consideration of the "volume of work previously awarded to each firm by the agency, with the object of effecting an equitable distribution of contracts among qualified firms," we find that the County's selection of a professional engineering firm pursuant to the CCNA is not the equivalent of the County's use of a system of rotation involving all of the qualified providers/vendors located within the County for its purchase of the goods and services that it requires. Although this may appear to work a harsh result here, as we discussed in CEO 91-24, our function is to interpret the ethics laws, not to make or amend them. It is the province of the Legislature to change the law to accommodate situations such as yours if it deems it to be appropriate.

Accordingly, we find that a prohibited conflict of interest would be created were you to work as an outside engineering consultant on non-County projects for an engineering firm which has been selected by the County pursuant to the CCNA to work on a County project.

ORDERED by the State of Florida Commission on Ethics meeting in public session on July 26, 2001 and RENDERED this 31st day of July, 2001

__________________________

Howard Marks

Chair