CONFLICT OF INTEREST

CITY COMMITTEE MEMBER EMPLOYED BY PRIVATE,
NONPROFIT CORPORATION RECEIVING FUNDING FROM THE CITY

To: Kirby G. Oberdorfer, Deputy Director, City of Jacksonville Ethics, Compliance & Oversight Office (Jacksonville)

SUMMARY:

No prohibited conflict of interest would be created were a member of the City of Jacksonville's Opioid Abuse Prevention Committee to be employed by a private, nonprofit corporation that has a contract with the City to provide opioid related services or that, as a direct result of recommendations from the member's agency regarding funding awards, may have a contract with the City to provide opioid services in the future. Section 112.313(7)(b), Florida Statutes, acts as a "waiver" of conflict under Section 112.313(7)(a), Florida Statutes, and the elements necessary for a conflict under Section 112.313(3), Florida Statutes, are not present. CEOs 04-1, 07-11, and 18-6 are referenced.¹

QUESTION 1:

Would a prohibited conflict of interest be created were a member of the City of Jacksonville's Opioid Abuse Prevention Committee to be employed by a private, nonprofit corporation that has a contract with the City to provide opioid related services?

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

In your letter of inquiry, additional materials supplied to our staff, and telephone conversations between you and our staff, you relate that you make inquiry in behalf of a current member of the newly-created City of Jacksonville's Opioid Abuse Prevention (OAP) Committee. You relate that, in his private capacity, the member is employed by Ascension,² the largest national nonprofit healthcare system, as the Chief Clinical Officer for its Florida region. Prior to the creation of the OAP Committee,³ you explain that in June 2017, the City Council for the City of Jacksonville funded "Project Saves Lives," a pilot program developed to address the opioid epidemic in Duval County in conjunction with local service providers specializing in addressing opioid addiction issues, including one of the member's private capacity employer, St. Vincent's—the subsidiary corporation owned by Ascension that is providing services for the Project Saves Lives program. The pilot program was comprised of two components: (1) evaluation and treatment of patients for six months and (2) data collection, analysis, and reporting on the effectiveness of the opioid abuse treatment programs for the six months during treatment and six additional months after the treatment ends. You relate that the treatment component consisted of initial evaluation and referral of patients to a targeted opioid treatment program with either in-patient/residential or outpatient services. Thereafter, you explain that City Council extended the treatment series component of the program, designating Gateway as the provider of treatment services, and also authorized two (2) additional local hospital Emergency Departments to participate in the Project Saves Lives pilot program, wherein they would provide evaluations and referrals of patients to supplement the services being provided by St. Vincent's.⁴ However, you relate that Ascension and St. Vincent's are not currently receiving funding from the City for the Project Saves Lives program.⁵ Specifically, you relate that although St. Vincent's currently has a contract with the City for the services it provides for the Project Saves Lives program, the contract does not provide for compensation to St. Vincent's.

As it relates to his private capacity employment with Ascension, you relate that the member—who specializes and is board certified in emergency medicine—works in conjunction with the Chief Operation Officer and the Chief Nursing Officer of the Florida regions to oversee all of the Florida hospitals owned by Ascension, including St. Vincent's three (3) hospitals. You further relate that the member is also employed as a physician at St. Vincent's, but that neither he, his spouse, nor his child is an officer, partner, director, proprietor, or owner of Ascension or St. Vincent's. As Chief Clinical Officer, the member supervises all Chief Medical Officers of the Ascension Florida hospitals and is responsible for clinical, quality of care, and physician related issues. In addition to his private capacity employment duties, the member works with the Project Saves Lives opioid program coordinated with a separate nonprofit corporation, Gateway Community Services, Inc. (Gateway), St. Vincent's, and various other local hospital Emergency Departments, advising on how the program works and answering questions from fellow physicians regarding the implantation of the Project Saves Lives program into the current hospital structure for participating Emergency Departments. Nevertheless, you explain that, in his private capacity roles, the member is not personally involved in obtaining Project Saves Lives funding (or any other funding) for St. Vincent's from the City and that the member's salary as Chief Clinical Officer for Ascension is not funded through money provided by the City. Rather, you relate that the member's only involvement with the City is through his work as the designated Contract Manager on behalf of St. Vincent's for its Project Saves Lives agreement with the City⁶ and his recent appointment to the OAP Committee, which the City Council created in order to continue the success of the Project Saves Lives program. Based upon the member's professional qualifications and experience in emergency medicine treating patients impacted by addiction, you explain that he was recently was nominated⁷ by the Mayor of the City of Jacksonville to serve as the designated Medical Professional, Emergency Department member of the OAP Committee, in accordance with Jacksonville Ordinance Code Section 84.202, which provides, in part:

Membership; appointment and removal; terms of office.—(a) Composition. The Committee shall consists of nine members to be appointed by the Mayor within the following categories:

(1) Medical Professional, Program Treatment;

(2) Medical Professional, Emergency Department;

(3) Mental Health professional;

(4) Addiction Treatment Provider;

(5) Certified Recovery Peer Specialist or Certified Recovery Support Specialist;

(6) Member from a Veteran Services Organization;

(7) Member from the Health Department;

(8) Member from a Homeless Advocacy organization; and

(9) Member from Jacksonville Sheriff's Office or Jacksonville Fire and Rescue Department.

The appointees shall be confirmed by City Council.

Pursuant to Jacksonville Ordinance Code Section 84.203, the OAP Committee is responsible, in part, for (1) reviewing and assessing the City's needs with respect to opioid addiction and recovery for funding opioid programs and (2) recommending programs, grant awards, and annual lump sum appropriations for the opioid abuse program funding. However, you relate that the Project Saves Lives program is excluded from the opioid abuse-related programs that the OAP Committee recommends funding for. Specifically, you explain that the Project Saves Lives funding is recommended to City Council by the Mayor as part of the City's annual budget and that the City Council will either approve or deny the recommended funding. As such, the OAP Committee will not have any involvement in, or oversight over, the additional funding and/or contracts for the Project Saves Lives opioid program.

Two prohibitions of the Code of Ethics for Public Officers and Employees are relevant to your inquiry. The first is Section 112.313(7)(a), Florida Statutes, which states:

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 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.

However, Section 112.313(7)(b), Florida Statutes, provides:

This subsection shall not prohibit a public officer or employee from practicing in a particular profession or occupation when such practice by persons holding such public office or employment is required or permitted by law or ordinance.

Absent an exemption, Section 112.313(7)(a) would prohibit the member from holding employment with the nonprofit, a business entity (defined in Section 112.312(5), Florida Statutes, to include corporations) doing business with his agency, and would prohibit the subject employee from having a contractual relationship which would create a continuing or frequently recurring conflict between his private interests and the performance of his public duties or which would impede the full and faithful discharge of his public duties. Here, although the member currently serves as the Contract Manager in behalf of St. Vincent's for the agreement between the nonprofit and the City of the Project Saves Lives opioid program, any conflict of interest that might exist for the member under Section 112.313(7)(a), due to his employment with the nonprofit, would be negated by Section 112.313(7)(b), a statutory provision which negates conflicts under Section 112.313(7)(a) where a particular employment is required or permitted by law or ordinance in order for the public officer to hold his position, such as is the case here under the City's OAP Committee ordinance (Medical Professional, Emergency Department). We have found that such a provision essentially works as a "waiver" of conflict "by recognizing that certain credentials are so vital to the expertise and operation of a public [committee] that the otherwise conflicting business/client connections of certain members must yield to the public purpose of a portion of the [committee's] membership possessing such professional training and practice." See, CEO 04-1 and other decisions of the Commission cited therein.

The second prohibition of the Code of Ethics that is relevant to your inquiry is Section 112.313(3), Florida Statutes, which states:

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.

This section prohibits a public employee from acting in an official capacity as a purchasing agent to purchase, rent, or lease any realty, goods, or services for his own public agency from a business entity of which the public officer or his spouse or child holds certain ownership or leadership positions. Here, you relate the member is only an employee of the nonprofit and that neither he nor his spouse or child holds certain ownership or leadership positions required to trigger the applicability of the first part of the statute. As such, we find that the first part of Section 112.313(3) is inapplicable and there is no prohibited conflict.

The second part of the statute prohibits a public officer from acting in a private capacity to sell services to his own agency or to any agency of his political subdivision. However, the Commission has previously found that, when a governmental agency merely provides grants or funding to an entity (e.g., a nonprofit) that in turn provides services to a specific clientele (e.g., citizens with needs) that the governmental agency itself has no legal obligation to serve, this does not constitute the selling of services within the meaning of Section 112.313(3). CEO 18-6 and CEO 07-11. Still, unlike nonprofits such as Gateway, St. Vincent's does not receive funding from the City Council to assist it in providing services for the Project Saves Lives opioid program to persons who—despite benefiting from the City's policy decision to address the opioid epidemic—the City is under no legal obligation to provide such services. As such, no prohibited conflict would be created under Section 112.313(3).

Thus, under the specific circumstances of your inquiry, we find that no prohibited conflict of interest would be created were the member of the City of Jacksonville's Opioid Abuse Prevention Committee to be employed by the nonprofit that currently has a contract with the City to provide opioid related services to citizens with opioid addictions.

Question 1 is answered accordingly.

QUESTION 2:

Would a prohibited conflict of interest be created were a member of the City of Jacksonville's Opioid Abuse Prevention Committee to be employed by a nonprofit that, as a result of recommendations from the member's agency regarding funding awards, may have a contract with the City to provide opioid services in the future?

Under the circumstances, Question 2 is answered in the negative.

Based upon the discussion in Question 1, above, Section 112.313(3) also is inapplicable in this instance. However, as discussed above, absent an exemption, Section 112.313(7)(a) would prohibit the member from holding employment with the nonprofit, a business entity doing business with his agency. Nevertheless, as explained above, any conflict of interest that might exist for the member under Section 112.313(7)(a) due to his employment with the nonprofit, including future contracts between the nonprofit and the City resulting from funding awards recommended by the OAP Committee, would be negated by Section 112.313(7)(b), under the specific facts and circumstances of this inquiry.⁸

Question 2 is answered accordingly.

ORDERED by the State of Florida Commission on Ethics meeting in public session on October 25, 2019, and RENDERED this 30th day of October, 2019.

____________________________________

Kimberly B. Rezanka, Chair

^[1] Prior opinions of the Commission on Ethics can be viewed at www.ethics.state.fl.us.

^[2]You relate that Ascension—a Catholic, not-for-profit healthcare corporation that owns and operates over 150 hospitals nationwide in twenty-one (21) states, including Florida—is the parent corporation established in 2012 by Ascension Health Systems. The Florida region is comprised of seven (7) hospitals, including all three (3) of the St. Vincent's Health System, Inc. hospitals in the state. As such, St. Vincent's is a wholly-owned subsidiary of Ascension Health, Inc.

^[3]You relate that the City Council created the OAP Committee on March 26, 2019.

^[4]Out of the initial $1,467,289.00 appropriated for the Project Saves Lives opioid epidemic pilot program, you relate that $86,932 went St. Vincent's, who executed its contract on November 17, 2017 for a term of twelve (12) months following the first date services were provided to patients.

^[5]You explain that, on September 24, 2019, the City Council approved the FY 2019-2010 budget that included an appropriation of $1,191,423.00 to Gateway for the Project Saves Lives program.

^[6]You relate that the member has advised that another St. Vincent's employee will serve this function in the future if necessary to avoid any conflict of interests.

^[7]You relate that the nomination took place on May 28, 2019.