CONFLICT OF INTEREST

CITY COUNCILMEMBER PRESIDENT OF CONSULTING COMPANY

To: Martin Shelby, City Council Attorney, City of Tampa (Tampa)

SUMMARY:

Advice is provided to a city councilmember as to a variety of circumstances involving his public relations/communications services company, its clients, and the city he serves. CEOs 76-21, 80-29, 05-07, 11-6, and 18-4 are referenced. ¹

QUESTION 1:

Would a prohibited conflict of interest be created were a city councilmember's company to provide services for a client related to a matter that might, in the future, come before the city council?

This question is answered as set forth below.

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 newly-elected member of a city council. You relate that the councilmember is president of a long-standing Florida corporation (company)² that provides public relations and communication services consulting. Although you explain that the company does not do business with the city and has no contractual relationships with the city, you relate that several of the company's clients may. In addition to their being regulated by, or their doing business with the city, you indicate that some of the company's clients—which may include public utilities or other governmental entities—could potentially do one or more of the following:

* contract to sell products or perform services for the city

* have contractual relationships, other than procurement, with the city

* sell and buy assets, which may include land, to and from the city

* seek comprehensive plan changes from the city council

* seek quasi-judicial relief from the city council

You relate that the councilmember's company has no authority over the aforementioned potential decisions or actions, nor can it anticipate future actions of its clients. Additionally, you indicate that the company also may offer its services as an outside consultant to a law firm engaged in litigation involving the city. Though these services may not necessarily be related to the subject matter of the litigation, you express that the possibility of such a relatedness exists. Another possibility is that the company will be (or has been) involved with the subject matter of a vote before city council (e.g., a petitioner seeking a rezoning may have engaged the company to perform public relations and communication services consulting relating to the land parcel). In addition to these future possibilities, you relate that some of the company's longstanding clients provide products or services to the city under existing agreements.

Given the city's "strong mayor" form of government pursuant to charter, you explain that the city council has no role in the administration (executive functions) of the city or the application of its ordinances and regulations. Rather, the city council acts as a legislative body that enacts ordinances, passes the budget, acts in a quasi-judicial capacity in land use matters,³ and passes resolutions.⁴

Relevant to your inquiry 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.

The first part of Section 112.313(7)(a) would prohibit the councilmember from having employment or a contractual relationship with a business entity (defined in Section 112.312(5), Florida Statutes, to include corporations) regulated by or doing business with his agency. For purposes of this statute, the "agency" of a city council member has been found to be the city council. CEO 18-4. Based upon the foregoing under the situation you present, the councilmember has both employment and a contractual relationship with the company. See, CEO 18-4, referencing CEO 05-7, CEO 80-29, and CEO 76-21. However, where the company is not regulated by the city council and you indicate that the company has no business relationships with the city council, we find that the first part of Section 112.313(7)(a) does not apply to create a prohibited conflict of interest for the councilmember based on his employment and contractual relationship with the company.

The second part of Section 112.313(7)(a) would prohibit the councilmember from having or holding any employment or 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. We have recognized that the second part of Section 112.313(7)(a) "is grounded on the principle that one cannot serve two masters, and calls for a comparison of an official's public responsibilities against his or her private interests to 'determine whether the two are compatible, separate, and distinct, or whether they coincide to create a situation which tempts dishonor.'" CEO 18-4, citing Zerweck v. State, Commission on Ethics, 409 So.2d 57, 61 (Fla. 4th DCA 1982). The issue here is whether the councilmember's interests in the company—including serving its clients that may have matters that intersect the functions of the city council—may tempt him to dishonor any responsibilities he has as a member of the city council. Regarding such, we previously have found that an adequate intersection of the private interests of the officer and the functions, duties, or subject matter of his public agency, would not exist were a business entity, such as the company here, merely to perform services for a client on a matter that might, in the future, come before the public officer's agency (e.g., a government board of which one is a member). See, CEO 11-6, Question 1 (city planning and zoning board member's firm working for the client on matter that might in the future come before the board). Thus, under such circumstances, no prohibited conflict would be created under Section 112.313(7)(a).

Question 1 is answered accordingly.

QUESTION 2:

Under what circumstances would the councilmember's company's work for a client intersect with the functions or subject matter of his agency such that a prohibited conflict of interest would be created under Section 112.313(7)(a)?

This question is answered as set forth below.

As discussed above, the first part of Section 112.313(7)(a) is triggered when a public officer holds employment or a contractual relationship with a business entity which is subject to the regulation of, or is doing business with, the officer's public agency. This means that in order for the prohibition of the first part to apply, the councilmember personally—not just his company or another employee of his company—must hold employment or a contractual relationship with a particular client,⁵ and the client must be regulated by, or doing business with, the city council. See, CEO 11-6. Here, as in CEO 11-6, we do not find that the city council would be "regulating" clients of the councilmember or of his company. However, were a client with which the councilmember personally holds a contractual relationship to be doing business with the city, we find that a prohibited conflict would be created, absent a "grandfathering" of the business (See, CEO 19-7, among others, regarding grandfathering or an exemption under Section 112.313(12), Florida Statutes). On the other hand, should clients of the company that are doing business with the city seek the services of the councilmember's firm generally (and not any services from him in particular) then the public relations and communication services consulting would not be prohibited under the first part of Section 112.313(7)(a). See, CEO 14-2.

As to the second part of Section 112.313(7)(a), we find that no prohibited conflict of interest would be created provided that neither the councilmember nor his company is engaged in work related to the passage or defeat of the matter before the city council. See CEO 11-6. However, we find that a prohibited conflict would be created under the second part were the councilmember or his firm to be engaged working in a lawsuit against the city or other matter against the city.⁶

Question 2 is answered accordingly.

ORDERED by the State of Florida Commission on Ethics meeting in public session on July 26, 2019, and RENDERED this 31st day of July, 2019.

____________________________________

Kimberly B. Rezanka, Chair

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

^[2]You relate that the nearly 30-year old company has offices in the city and in another major Florida city.

^[3]This includes serving as an appellate board for administrative employee and lower board land use decisions, as required by the city's code.

^[4]Examples include resolutions authorizing the mayor to sign contracts on the city's behalf, approving departmental reorganization, and confirming department heads, as required by the city charter.

^[5]In all likelihood, many, if not all, of the company's clients would be "business entities," as defined in Section 112.312(5), Florida Statutes, to mean:

any 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.

^[6]Based upon the answers provided earlier in this opinion, the voting conflicts law should only be relevant to city council measures involving the company's clients in which the company is not working on the city council matter for the client or others at the time the matter is a city council matter, and in which the matter is not against the city. Otherwise, Section 112.313(7)(a) would also be implicated. See, CEO 11-6, fn. 13. Nevertheless, Section 112.3143(3)(a), Florida Statutes, must be followed by the councilmember as to his clients and company. See CE Form 8B.