CONFLICT OF INTEREST

COUNTY EMPLOYEE CONTRACTING WITH COUNTY TO BE INDEPENDENT CONTRACTOR AFTER RETIREMENT

To: Robert B. Shillinger, County Attorney (Monroe County)

SUMMARY:

Under the particular circumstances presented, a prohibited conflict of interest would not be created under Section 112.313(3) or Section 112.313(7)(a), Florida Statutes, were a county employee to enter into a post-public-employment consulting agreement with the county. CEO 08-14 is referenced.¹

QUESTION:

Would a prohibited conflict of interest be created were a county employee to enter into an agreement with the county which sets out the terms and conditions by which the employee will serve as an independent contractor consultant for the county after the employee's retirement from county employment?

Under the circumstances presented, your question is answered in the negative.

You write that Monroe County's Deputy County Administrator (employee), who has been a County employee for thirty-two years, has been in the Deferred Retirement Option Program (DROP) of the Florida Retirement System (FRS) for two years, and that her scheduled end date of County employment is in September 2017. Under DROP, an employee who is actually retired continues employment with an FRS employer, but the retirement benefits that the employee would have received are deferred, and, together with interest, are deposited in the employee's trust account until the employee's final termination date, which date can be no more than five years from the date the employee entered DROP. The County Administrator and the employee have discussed reorganization of County senior staff after the employee's departure and have discussed the possibility that the employee would leave County employment before her current end date, possibly as early as October 2014. However, the employee has stated that she would accelerate her termination only if she could receive a severance package that would provide the same contribution to her FRS trust account as if she had stayed in DROP for the entire five years: a figure equivalent to about eighty-three weeks' of annual salary. Continuing, you state that in light of the caps (twenty weeks' worth in some circumstances, six weeks' worth in others) under Section 215.425, Florida Statutes, on the amount of severance pay that can be paid by a government entity, it is impossible for the County to offer the employee a severance package with the compensation she desires, based solely on severance pay. However, you relate that the employee's longevity as a County employee, her status as a senior employee, and her institutional memory have great value to the County, and suggest that a post-public-employment consulting agreement may be a way for the County to compensate the employee for the money that otherwise would have been placed in her DROP account, without violating the caps of Section 215.425. The agreement would be negotiated and executed while the employee is a County employee and would require approval of the Board of County Commissioners; however, the employee would not begin her consulting work until after she leaves County employment.

Sections 112.313(3) and 112.313(7)(a), Florida Statutes, the provisions of the Code of Ethics for Public Officers and Employees (Part III, Chapter 112, Florida Statutes) relevant to your inquiry,² 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 or when such offices are on property wholly or partially owned by the legislator. This subsection shall not affect or be construed to prohibit contracts entered into prior to:

(a) October 1, 1975.

(b) Qualification for elective office.

(c) Appointment to public office.

(d) Beginning public employment.

[Section 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.]

Section 112.313(3), considered in isolation, would appear to prohibit the employee and the County from entering into the consulting contract, in that entry would constitute the employee's acting in a private capacity to sell services to her political subdivision (the County). CEO 08-14. However, under the particular facts presented in the instant situation, we find it appropriate to apply Section 112.316, Florida Statutes, to ameliorate the literal effect of Section 112.313(3). It is apparent that the employee is not the decisionmaker for the County regarding whether to contract with her for post-public-employment consulting; rather, it is the County Administrator and the Board of County Commissioners who will make the decision. Also, it is apparent that the County is not engaging in a request for proposals or similar procurement, but, rather, that it would be developing a specific services/retirement package peculiar to its needs and those of the employee. Section 112.316 provides:

CONSTRUCTION.—It is not the intent of this part, nor shall it be construed, to prevent any officer or employee of a state agency or county, city, or other political subdivision of the state or any legislator or legislative employee from accepting other employment or following any pursuit which does not interfere with the full and faithful discharge by such officer, employee, legislator, or legislative employee of his or her duties to the state or the county, city, or other political subdivision of the state involved.

As to Section 112.313(7)(a), we do not perceive a prohibited conflict under the first part of the statute, were the agreement between the employee and the County to be entered into, because in such a situation the employee would hold a contractual relationship with her own County government, which is neither a business entity nor another governmental entity. Further, to the extent the employee would hold employment or a contractual relationship with her own consulting business (CEO 08-14), a business entity doing business with the County by virtue of the consulting agreement, we find that Section 112.316 likewise ameliorates the conflict, under the particular circumstances presented. As to the second part of the statute, we see no continuing or frequently recurring conflict between the employee's private interests and the performance of her public duties as a County employee, and we see no impediment to the full and faithful discharge of her public duties, occasioned by the agreement. Again, it is the County Administrator and the Board of County Commissioners who will be acting for the County regarding negotiating and entering into the agreement, not the employee; and we see no reason to believe the employee would be any less effective in her remaining service as a County employee due to the agreement.

Accordingly, under the circumstances presented, we find that a prohibited conflict of interest would not be created under Section 112.313(3) or Section 112.313(7)(a), Florida Statutes,³ were the employee and the County to enter into a post-public-employment consulting agreement.

ORDERED by the State of Florida Commission on Ethics meeting in public session on September 12, 2014, and RENDERED this 17th day of September, 2014.

____________________________________

Linda McKee Robison, Chair

^[1] Prior opinions of the Commission on Ethics may be obtained from its website (www.ethics.state.fl.us).

^[2]The post-public-employment restrictions of Sections 112.313(14), 112.313(9)(a)4., and 112.3185, Florida Statutes, are not applicable to former local government employees.

^[3]We express no opinion herein as to Section 215.425, Florida Statutes, inasmuch as it is not within our jurisdiction to do so.