CEO 76-66 -- April 16, 1976

CONFLICT OF INTEREST

PUBLIC OFFICER DOING BUSINESS WITH COUNTY

To: (Name withheld at the person's request.)

Prepared by: Gene Rhodes

SUMMARY:

Florida Statute s. 112.313(7)(1975) prohibits an officer within a political subdivision from acting privately to rent, lease, or sell any realty, goods, or services to any agency of that subdivision. Where a member of a county water management advisory board owns a material interest in an engineering firm which contracts with the county for architectural projects unrelated to ground or surface water, however, no conflict is deemed to exist, pursuant to Florida Statute s. 112.316(1975), which provides that a public officer shall not be prohibited from following any private pursuit which does not interfere with the discharge of his public duty. The board member is not in a position to supervise or regulate the county commission, which enters into such contracts for the county, and the board's duties do not involve approval of or giving of advice or recommendation as to contracts related to architectural projects. The subject engineering firm may not privately contract as a joint venturer with another firm on county projects relating to ground or surface water, however, inasmuch as the board member's public duties relate to advising the county commission in these matters. The engineering firm is not prohibited from subcontracting with principal contractors on county projects relating to ground or surface water inasmuch as it is the principal contractor who is doing business with the county, while the engineering firm is doing business with the principal contractor, a private entity.

QUESTIONS:

1. Does a conflict of interest exist where a member of a county's water management advisory board is an owner of a material interest in an engineering firm which contracts with the county for architectural projects unrelated to ground or surface water?

2. Does a prohibited conflict of interest exist where a member of a county's water management advisory board owns a material interest in an engineering firm which privately contracts as a joint venturer with another firm on county projects relating to ground or surface water?

3. Does a prohibited conflict of interest exist where a member of a county's water management advisory board is an employee and owner of a material interest in an engineering firm which subcontracts with principal contractors on county projects relating to ground or surface water?

Question 1 is answered in the negative.

Your letter of inquiry advises us that the public officer in question is a member of the county's water management advisory board (WMAB) and an employee of and owner of a material interest in a local engineering firm which contracts with the county for architectural projects unrelated to ground and surface water.

The Code of Ethics for Public Officers and Employees states in relevant part:

DOING BUSINESS WITH ONE'S AGENCY. -- No employee of an agency acting in his official capacity as a purchasing agent, or public officer acting in his official capacity, shall either directly or indirectly purchase, rent, or lease any realty, goods, or services for his own agency from any business entity of which he or his spouse or child is an officer, partner, director, or proprietor or in which such officer or employee or his 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 his own agency, if he is a state officer or employee, or to any political subdivision or any agency thereof, if he 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. This subsection shall not affect or be construed to prohibit contracts entered into prior to:

(a) October 1, 1975.

(b) Qualification for elective office.

(d) Beginning public employment.

[Emphasis supplied; Fla. Stat. s. 112.313(3)(1975).]

The emphasized portion of the above-quoted provision prohibits a public officer from selling goods or services to any agency of his political subdivision. In a previous opinion of this commission, CEO 75-196, we held that ownership of a material interest in a business entity constitutes acting in one's private capacity when that entity transacts business. Given this interpretation, it would appear that the subject public officer is prohibited from being a member of WMAB while the engineering firm of which he owns a material interest is concurrently doing business with the county. However, s. 112.313(3) must be read in light of another provision of the Code of Ethics which states:

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 duties to the state or the county, city, or other political subdivision of the state involved. [Fla. Stat. s. 112.316(1975).]

The above-quoted provision makes it clear that the Code of Ethics shall not be construed to prohibit a public officer or employee from following any pursuit which does not interfere with the full and faithful discharge of his duties. Each standard of conduct must be read with this qualification in mind. This board member is not in a position to supervise or regulate the county commission, which enters into such contracts for the county. Nor do the board members' duties in any way involve approval of or the giving of advice or recommendations as to contracts related to architectural projects. This being the case, the contracts between the subject engineering firm and the county do not interfere with the full and faithful discharge of the concerned public officer's duties, and therefore, the above-described situation is not prohibited by the Code of Ethics.

Question 2 is answered in the affirmative.

Your letter of inquiry advises us that the engineering firm in which the public officer owns a material interest and by which he is employed acts as a joint venturer with other firms on county projects relating to ground or surface water.

Please find enclosed a copy of a previous opinion of this commission, CEO 76-7, the rationale of which is equally applicable to your question in that Florida Statute s. 112.313(3)(1975) applies to the sale of goods and services as well as to the sale of realty. This question is answered accordingly in the affirmative.

Question 3 is answered in the negative.

Your letter of inquiry advises us that the engineering firm of which the WMAB member is an employee and in which he owns a material interest subcontracts on county projects relating to ground or surface water.

In this situation the engineering firm is not selling goods or services to the county, but rather to the principal contractor. Hence, s. 112.313(3), quoted above, does not apply provided the county has no part in the subcontract or approval thereof.

Another provision of the Code of Ethics states in relevant part:

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 is an officer or employee, excluding those organizations and their officers who, when acting in their official capacity, enter into or negotiate a collective bargaining contract with the state or any municipality, county, or other political subdivision of the state; 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 private interests and the performance of his public duties or that would impede the full and faithful discharge of his public duties. [Emphasis supplied; Fla. Stat. s. 112.313(7)(1975).]

The emphasized portion of the above-quoted provision prohibits a public officer from having employment or a contractual relationship with any business entity which is doing business with that public officer's agency. The primary contractor is doing business with the county commission, not with WMAB which is the public officer's agency. See Fla. Stat. s. 112.312(2)(1975).

Consequently, the WMAB member is not prohibited by the Code of Ethics from subcontracting with a principal contractor on projects related to surface and ground water.