POSTEMPLOYMENT RESTRICTIONS

DEPARTMENT OF ECONOMIC OPPORTUNITY FORMER EMPLOYEE CONTRACTING
WITH RECIPIENT OF SPECIFIC LEGISLATIVE APPROPRIATION

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

SUMMARY:

A former Career Service employee of the Florida Department of Economic Opportunity (DEO) would not be subject to postemployment restrictions under Sections 112.313(9)(a)4 or 112.3185(3), Florida Statutes, if she or her company contracted to work for a government entity that is a recipient of a legislative appropriation of a grant for a specific project to be overseen by DEO. If she was responsible for a contract(s) for contractual services while employed at DEO, under the facts presented, restrictions would apply under Section 112.3185(4), Florida Statutes, in certain circumstances. CEO 17-6, CEO 14-2, CEO 11-24, CEO 08-17, CEO 06-3, and CEO 82-78 are referenced.¹

QUESTION:

Would you, a former employee of DEO, be subject to postemployment restrictions if you or your company were to contract to work for a recipient of a legislative appropriation of a grant for a project to be overseen by DEO?

Under the circumstances presented, your question is answered as set forth below.

In your letters of inquiry, you state that you were employed by the Department of Economic Opportunity (DEO) from 2011 until June 2017, where you were a manager of DEO's grant agreements with recipients of line-item appropriations for specific legislatively-assigned projects, and that your position was classified as Career Service. You explain that, during your employment at DEO, you collaborated in drafting agreements with grant recipients as to details of projects determined and financed by legislative appropriations, monitored project performance, reviewed reports and payment requests by grant recipients, and drafted agreement closure documents. You state that you have formed a limited liability company (LLC) in order to represent, on a contractual basis, the recipients of grants from State agencies for specific projects which were authorized through line-item legislative appropriations, rather than under the process for State agency procurement of commodities and contractual services set forth in Chapter 287, Florida Statutes. You explain that, in your position at DEO, you had no influence as to which grant recipient received an appropriation, the amount of an appropriation, or the purpose of an appropriation.

You state that, following an appropriation for a particular project, a legislatively-assigned State agency works with the legislatively-designated grant recipient to develop a project-specific agreement as to details for carrying out the project. You explained, in your letters and in a telephone call with our staff, that your inquiry specifically concerns your company's contract to represent a particular Florida county which is a legislatively-designated recipient of a legislatively-appropriated grant to carry out a project intended to foster development of entrepreneurial businesses in that county, with DEO assigned to oversee the project. You explain that your service to the county (your client), and to future such clients, would include assistance in making State agency submissions, including project agreements and amendments, reports and payment requests, and closure of completed agreements, which are the same types of tasks you performed on behalf of DEO when you were employed there. You ask whether you would be subject to postemployment restrictions under the Code of Ethics as to these activities.

The provisions of the Code of Ethics potentially implicated² are Sections 112.3185(3) and 112.3185(4), Florida Statutes,³ applicable to former State agency employees. Section 112.3185(3), Florida Statutes, states in relevant part:

An agency employee may not, after retirement or termination, have or hold any employment or contractual relationship with any business entity other than an agency in connection with any contract in which the agency employee participated personally and substantially through decision, approval, disapproval, recommendation, rendering of advice, or investigation while an officer or employee . . . .

This statute prohibits you from going to work for a private business (prime contractor, subcontractor, or business entity owned by you) in connection with a contract where you were personally and substantially involved in the procurement of the contract. We find that if you or your company were to contract with a business entity for work in connection with a grant obtained through legislative appropriation, you would not be subject to the prohibition under Section 112.3185(3) because you could not have participated in a nonexistent State agency procurement process. See CEO 17-6.

Also relevant is Section 112.3185(4), Florida Statutes, which states in pertinent part:

An agency employee may not, within 2 years after retirement or termination, have or hold any employment or contractual relationship with any business entity other than an agency in connection with any contract for contractual services which was within his or her responsibility while an employee . . . .

Contractual services are defined in Section 287.012(8), Florida Statutes, as:

. . . [T]he rendering by a contractor of its time and effort rather than the furnishing of specific commodities. The term applies only to those services rendered by individuals and firms who are independent contractors. . . ."

Reading these sections together, Section 112.3185(4) prohibits you, for two years after leaving DEO, from working for any business entity—including your own company⁴—in connection with any contract for contractual services that was within your responsibility or that of your subordinates while you were employed by DEO.

The question then becomes what, if any, contracts for contractual services were within your responsibility while you were at DEO. You explained that DEO agreements related to grants for specific projects authorized by the Legislature were within your responsibility while you were employed at DEO and that these agreements were related to project performance. You state that some of the grants went to government entities, and some to private entities. Your potential scenarios are addressed below.

A legislative grant agreement between a State agency and a grant recipient that is a government entity cannot be a contract for contractual services, because the definition of "contractual services" in Section 287.012(8), Florida Statutes, speaks only to contracts with private individuals and firms. Thus, if such a grant agreement (contract) was within your responsibility⁵ or that of your subordinates while you were at DEO, Section 112.3185(4), Florida Statutes, generally would not restrict you, individually or through your company, from contracting with the government entity receiving the grant from DEO. However, in some circumstances, as explained below, you would be prohibited from contracting with the government entity through your company.

You relate that a government-entity grant recipient may, in furtherance of the legislatively-assigned projects, contract with a private entity. If such a project-performance contract between a government entity and a private entity is for the provision of time and effort, rather than commodities, it meets the definition of contract for contractual services. If such a "sub-contract" with a private entity was in existence and was within your responsibility when you were at DEO, both you and your company would be prohibited for two years after your departure from DEO from contracting with that business entity in connection with that sub-contract. You also would be prohibited during the two-year period from contracting, through your company, with the government entity in connection with that sub-contract with the private entity. However, you would not be prohibited from contracting, as an individual, with the government entity or from being employed by the government entity, in connection with the sub-contract with a private entity.

Your question is answered accordingly.

ORDERED by the State of Florida Commission on Ethics meeting in public session on April 20, 2018, and RENDERED this 25th day of April, 2018.

____________________________________

Michelle Anchors, Chair

^[1]Opinions of the Commission on Ethics may be obtained from its website at www.ethics.state.fl.us

^[2]Since you state that your position at DEO was classified as Career Service (and, apparently, had been Career Service for some time), you would not be subject to Section 112.313(9)(a)4, Florida Statutes, which prohibits, during the two years after vacating a covered "employee" position, any lobbying or other representation before the former agency of a State agency employee whose public position was classified as Selected Exempt Service (SES), Senior Management Service (SMS), or certain other positions.

^[3]See CEO 11-24 for a discussion of the restrictions under Sections 112.3185(3) and 112.3185(4), Florida Statutes, which operate independent of the restriction in Section 112.313(9)(a)4, Florida Statutes. Also discussed in CEO 11-24 is Section 112.3185(5), Florida Statutes, which would apply if you were to be paid for employment or contractual services by DEO (directly or through a closely held company of yours) during the first year after your departure from DEO and which states that such payment shall not exceed your annual salary received on the date of cessation of your previous responsibilities.

^[4]"Business entity" is defined in Section 112.312(5), Florida Statutes, as:

. . . [A]ny corporation, partnership, limited partnership, company, limited liability company, proprietorship, firm, enterprise, franchise, association, self-employed individual, or trust, whether fictitiously named or not, doing business in this state.

Although you may be the sole owner of your company, it is still a separate legal entity and has an identity separate from you. See CEO 14-2 and CEO 82-78.

^[5]"Within responsibility" is not mere incidental contact with the contract but includes situations involving monitoring or managing a contract or supervising another who does so. See CEO 06-3, CEO 08-17, and CEO 11-24.