CONFLICT OF INTEREST

AGENCY FOR PERSONS WITH DISABILITIES (APD) EMPLOYEE
OWNER OF COMPANY ENROLLED TO PROVIDE SERVICES ADMINISTERED
BY APD AND WORKER AT PRIVATE FACILITY SERVING APD CLIENTS

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

SUMMARY:

Under the circumstances presented, a prohibited conflict of interest would be created under Section 112.313(7)(a), Florida Statutes, were an individual who owns and operates a company enrolled to provide services administered by the Agency for Persons with Disabilities (APD), and who works at a private facility serving APD clients, to become an APD employee. CEO 05-6, CEO 05-7, CEO 14-2, and CEO 14-16 are referenced.¹

QUESTION:

Would a prohibited conflict of interest be created were an individual who owns and operates a company enrolled to provide services administered by the Agency for Persons with Disabilities, and who works at a private facility serving Agency clients, to become an Agency employee?

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

You write that an individual who owns and operates a company enrolled to provide services administered by the Agency for Persons with Disabilities (APD), and who works at a private facility serving APD clients,² is being considered for hiring by APD as a Human Services Program Specialist (OPS, other-personal-services,³ employment classification). In the APD position, he would be responsible for coordinating meetings and reviews of behavior analysis treatment protocols for persons served through the Agency for Health Care Administration (AHCA) Home and Community Based Medicaid Waiver; and his duties would include behavioral assessments and service recommendations for persons requesting Medicaid waiver services as part of a prior authorization process. Continuing, you relate that although the duties of the APD employment are related to the type of work performed by the individual's company, his company no longer has service authorizations to provide behavioral services, but would continue as a vendor of competency restoration services.⁴ However, you state that the competency restoration services provided by his company occasionally have a peripheral relationship to the duties of the APD employment, that he would not be in a position via his APD employment to refer clients to his company, authorize services from his company, engage in regulatory oversight of his company, or approve payments to his company; and it is your view that APD clients would not have their ability to make voluntary choices among private providers of services compromised due to the APD employee's company's provision of services.

Provisions of the Code of Ethics for Public Officers and Employees (Part III, Chapter 112, Florida Statutes) pertinent to your inquiry are Sections 112.313(3) and 112.313(7)(a), Florida Statutes, which 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) prohibits a public employee, acting as a purchasing agent, from purchasing, renting, or leasing any realty, goods, or services from a business in which he, his spouse, or his child has certain ownership or leadership interests; and it prohibits a state-government-level public employee from acting in a private capacity to rent, lease, or sell any realty, goods, or services to his public agency. However, Section 112.313(3) contains a "grandfather" clause which exempts from its prohibitions "contracts entered into prior to beginning public employment," such as the existent contract between the individual's company and APD which will expire on June 30, 2016. Therefore, we find that a prohibited conflict of interest under Section 112.313(3) will not be created due to the existing contract,⁵ should the individual become employed by APD.

The first part of Section 112.313(7)(a) prohibits a public employee from having employment or a contractual relationship with a business entity which is either regulated by, or which is doing business with, his public agency; and the second part prohibits employment or contractual relationships that will create a continuing or frequently recurring conflict between the public employee's private interests and the performance of his public duties, or which would impede the full and faithful discharge of his public duties. In addition, unlike Section 112.313(3), Section 112.313(7)(a) does not contain an express "grandfather" clause exempting from its "doing business" prohibition contracts entered into before one began public employment;⁶ and Section 112.313(7)(a) contains prohibitions based in a business entity being subject to the regulation of an agency, based in a continuing or frequently recurring conflict, and based in an impediment to the full and faithful discharge of public duty. Therefore, our analysis herein of your inquiry, under Section 112.313(7)(a), necessarily is more complicated than that concerning Section 112.313(3).

Regarding "regulation," we find that the individual's company is subject to the regulation of APD, his public agency.⁷ Supportive of our determination is the following information from your correspondence:

General quality management regulation and contract management of [the individual's/proposed employee's] company and other vendors is performed by yet another group of APD employees.

[The individual's/proposed employee's] OPS duties involve review and oversight of behavioral services provided by other APD vendors as assigned by APD. If any reviews are required for services in the ICF/DD that [he] provides services in, APD will assign that review to another . . . .

Thus, we find that a prohibited conflict of interest would be created under the first part of the statute, were the individual to become an APD employee, because his company is a business entity subject to the regulation of APD.⁸

As to the second part of Section 112.313(7)(a), we also find that the situation would be conflicting. It is apparent from the inquiry that there is a broad intersection of the individual's private APD vendor interests, and interests of the facility he works at privately, with the duties and responsibilities of APD, the entity that would be his public agency. Further, it is apparent that attempts to isolate him from public responsibility toward his vendor interests or the interests of the facility, by removing him from certain APD roles that his APD position otherwise would perform, would, in and of themselves, create a continuing or frequently conflict or impede the full and faithful discharge of his APD duties.

In making our findings herein, we have not overlooked Section 393.0654, Florida Statutes, which provides:

Direct service providers; private sector services.--It is not a violation of s. 112.313(7) for a direct service provider who is employed by the agency to own, operate, or work in a private facility that is a service provider under contract with the agency if:

(1) The employee does not have any role in the agency's placement recommendations or the client's decisionmaking process regarding placement;

(2) The direct service provider's employment with the agency does not compromise the ability of the client to make a voluntary choice among private providers for services;

(3) The employee's employment outside the agency does not create a conflict with the employee's public duties and does not impede the full and faithful discharge of the employee's duties as assigned by the agency; and

(4) The service provider discloses the dual employment or ownership status to the agency and all clients within the provider's care. The disclosure must be given to the agency, the client, and the client's guardian or guardian advocate, if appropriate.

Although this statute became effective in 2006, this opinion presents our first opportunity to construe it. It is apparent from the language of the provision that its substance is that of an exemption to the prohibitions of Section 112.313(7)(a). As such, we are bound to construe its application narrowly. State v. Nourse, 340 So. 2d 966 (Fla. 3d DCA 1976). Assuming for argument's sake that the requirements of Section 393.0654 are met regarding the individual's company's contract with APD,⁹ it is clear that the requirements would not be met regarding his work at the facility in St. Augustine, inasmuch as the first paragraph of the exemption states that one's work must be in "a private facility that is a service provider under contract with [APD]," and inasmuch as your correspondence states that the facility is not a service provider under contract with APD.

Accordingly, under the circumstances presented, we find that a prohibited conflict of interest would be created under Section 112.313(7)(a), Florida Statutes, were the individual to become an employee of APD.

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]Through his company, an independent contractor for the St. Augustine Center for Living, ICF/DD (intermediate care facility for the developmentally disabled).

^[3]It is clear that OPS employees are public employees subject to the Code of Ethics. Section 110.131, Florida Statutes.

^[4]The individual's company has a provider agreement with APD and a provider agreement with AHCA, regarding delivery of direct behavior analysis services, the APD agreement expiring on June 30, 2016, and the AHCA agreement expiring on January 27, 2016.

^[5]If, in the future, a new contract, or an extension or renewal of the grandfathered contract, between the employee's company and APD, were to be contemplated, grandfathering might not continue to apply, but potential exemptions might apply. However, our decision herein regarding Section 112.313(7)(a), Florida Statutes, apparently renders moot such future concerns.

^[6]In appropriate circumstances, we have applied Section 112.316, Florida Statutes, to "imply" a grandfather clause regarding Section 112.313(7)(a). See, for example, CEO 14-16. However, such application is not statutorily mandated; and we find that it would not be definitive as to our decisional outcome to apply it here, due to the facts of your inquiry and the multiple bases of potential conflict contained within Section 112.313(7)(a).

^[7]The "agency" of an employee of APD is the entire APD. CEO 05-6 and CEO 05-7.

^[8] While the facility in St. Augustine that the individual works at in a private capacity apparently is primarily licensed or regulated by AHCA, rather than APD, it appears that APD, too, may have some regulatory interface with the facility. Supportive of this is the following from your correspondence:

If any reviews are required for services in the ICF/DD that [the individual] provides services in, APD will assign that review to another . . . . The facility is licensed by AHCA, and certain behavioral treatment plans are subject to review and approval by the local review committee through APD as specified in FAC 65G-4.008.

In addition, even though the facility is contracting with the individual's company, rather than with the individual himself, because it is apparent that the facility desires the personal work and labor of the individual rather than that of his company generally, we find that his performance of work at the facility through a business entity does not insulate him from application of the first part of Section 112.313(7)(a). CEO 14-2 (Question 2).

^[9]Subsection (2) of the exemption embodies language which would appear to require a cumbersome client-by-client review. In addition, subsection (3), rather than lending itself to applicability of the exemption to the instant situation, supports our finding of an impediment to the full and faithful discharge of public duty, as discussed above.