CONFLICT OF INTEREST

CITY PLANNING AND ZONING BOARD MEMBER
PARTNER IN COMPANY DOING BUSINESS WITH COMMUNITY REDEVELOPMENT AGENCY

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

SUMMARY:

Under the circumstances presented, no prohibited conflict of interest would be created under Section 112.313(3) or Section 112.313(7)(a), Florida Statutes, were a member of a city's planning and zoning board to sell, through a company that he co-owns, goods and services to the same city's community redevelopment agency. Although Section 112.313(3), Florida Statutes, prohibits a public officer from acting in a private capacity to sell goods or services to the political subdivision in which he serves or to any agency thereof, previous Commission on Ethics opinions have found that under Section 112.316, Florida Statutes, a member of a board of a political subdivision may sell to another agency of the political subdivision as long as the board is not responsible for the approval of or the giving of advice or recommendations as to the purchase. In addition, the company would not be subject to the regulation of or doing business with the planning and zoning board, so the prohibition of the first part of Section 112.313(7)(a), Florida Statutes, would not apply; nor would the situation give rise to a continuing or frequently recurring conflict or impede the full and faithful discharge of public duties under the second part of Section 112.313(7)(a), Florida Statutes. CEOs 76-38, 81-2, 87-39, 88-17, 90-7, 91-55, 07-12, 09-1 and CEO 11-6 are referenced.¹

QUESTION:

Would a prohibited conflict of interest be created were a member of a city's planning and zoning board to sell, through a company that he co-owns, goods and services to the same city's community redevelopment agency?

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

In your letter of inquiry and supplemental information provided to our staff, you indicate that you serve as an appointed member of a city's planning and zoning board (PZB). The PZB consists of five members appointed by the City Commission. You advise that the PZB acts in an advisory capacity to the City Commission on questions raised by City staff relating to zoning and City planning, conducts investigations, and holds public hearings on proposals to change zoning regulations and reports its findings and recommendations to the City Commission.²

You further relate that in your private capacity you are a partner in, and partial-owner of, a concrete company. You state that the company has developed a proprietary process of building spray-on reinforced monolithic concrete structures. You indicate that this process enables the company to offer building services and materials that are hurricane, fire, tornado, and insect resistant at competitive prices.

You state that you would like to approach members of the City's community redevelopment agency (CRA) to discuss the merits of the company's products in the event that the CRA has any upcoming building projects in need of reinforced concrete hurricane-proof structures. The CRA is a dependent special district created in 1996 by the City Commission via the adoption of City Ordinance 96-15 and pursuant to the authority in Chapter 163, Florida Statutes. The City Commission has delegated to the CRA the authority set forth in Section 163.370, Florida Statutes, including the power to plan and implement redevelopment and economic development activities within its district, as set forth in the adopted community redevelopment plan. The CRA is governed by a board of five commissioners appointed by the City Commission.

Thus, you inquire whether a prohibited conflict of interest would arise under the Code of Ethics for Public Officers and Employees (Code of Ethics) were the company to engage in a contract for the provision of goods and services to the CRA. The prohibitions of the Code of Ethics relevant to your inquiry are contained within Sections 112.313(3) and 112.313(7)(a), Florida Statutes. Section 112.313(3), Florida Statutes, provides:

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.

The first part of Section 112.313(3) prohibits a public officer from acting in an official capacity to purchase, rent, or lease any realty, goods, or services for his own public agency from any business entity (e.g., a corporation or a company) of which the public officer holds certain ownership or leadership positions. In CEO 90-7 we advised that the "agency" of a city planning and zoning board member was that board, and not the whole of the city. See also, CEO 88-17, CEO 87-39, and CEO 11-6. Therefore, your agency is the PZB.

We find that the prohibition of the first part of Section 112.313(3) is not applicable in the instant case since you, as a member of the PZB, are not seeking to purchase goods or services for the PZB from your company. Rather, your company is contemplating the sale of goods and services to the CRA (a separate agency from the PZB).

The second part of Section 112.313(3), Florida Statutes, prohibits a public officer from acting in a private capacity to sell goods or service to his political subdivision or to any agency of the political subdivision. In previous opinions of this Commission we have found that either owning a material interest in or being a director of a business entity selling goods or services constitutes "acting in one's private capacity" to sell within the meaning of the second part of Section 112.313(3), Florida Statutes. See e.g., CEO 81-2 and CEO 09-1. Accordingly, without further analysis, the second part of the statute would seem to prohibit your company from engaging in the sale of goods or services to the CRA.

However, in construing the provisions of the Code of Ethics as they apply to private business pursuits of public officials, the Commission on Ethics has found, under Section 112.316, Florida Statutes, that a member of a board is not prohibited from selling to agencies of his political subdivision other than the agency of which he is a member, as long as neither the public officer nor his board has any authority regarding the rendering of advice, provision of recommendations, or the ultimate approval of the contracts associated with those services. See, CEO 76-38, CEO 88-17, CEO 91-55 and CEO 07-12. Section 112.316, Florida Statutes, 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.

The Commission has opined that Section 112.316, Florida Statutes, makes it clear that the Code of Ethics shall not be construed to prohibit a public officer or employee from following a private business pursuit which does not interfere with the full and faithful discharge of his duties. We believe that application of Section 112.316 is appropriate to your situation, to negate application of the second part of Section 112.313(3). In the instant matter, the PZB has no authority as to the consideration or approval of contracts entered into by the CRA.

Also pertinent to your inquiry is Section 112.313(7)(a), Florida Statutes, which provides:

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, also has two parts. The first part prohibits a public officer from having or holding employment or a contractual relationship with another public agency or with a business entity if the agency or entity is subject to the regulation of, or is doing business with, the officer's public agency. The second part of Section 112.313(7)(a), Florida Statutes, prohibits a public officer from having or holding any employment or any contractual relationship that would create a continuing or frequently recurring conflict between the public officer's private interests and the performance of the officer's public duties or that would impede the full and faithful discharge of the officer's public duties.

We find that the facts in the instant matter do not give rise to a conflict of interest under either the first or second part of Section 112.313(7)(a), Florida Statutes. A prohibited conflict would not be created under the first part of Section 112.313(7)(a) were your company to do business with the CRA, inasmuch as the company would be doing business with an agency different from your public "agency." See, for example, CEO 87-39. And, we do not find that a prohibited conflict would be created under the second part of Section 112.313(7)(a) were the company to do business with the CRA, due to the PZB's lack of a role regarding the business between the company and the CRA.

Accordingly, we find that the PZB member's ownership interest in, and position with, a company that provides goods or services to the CRA would not create a prohibited conflict of interest under Section 112.313(3) or Section 112.313(7)(a), Florida Statutes.

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] Prior opinions of the Commission on Ethics can be viewed at www.ethics.state.fl.us.

^[2] See, also, Code of Ordinances of the City, Section 2-88.