CEO 77-41 -- March 9, 1977

CONFLICT OF INTEREST

CORPORATION WHOSE STOCKHOLDERS TEACH BUILDING CONSTRUCTION AT STATE UNIVERSITY PREPARING CONSTRUCTION INDUSTRY LICENSING EXAMINATION

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

Prepared by: Bonnie Johnson

SUMMARY:

There is no violation of the Code of Ethics for Public Officers and Employees where a corporation whose stockholders are faculty members of a state university's school of building construction are awarded via competitive bid procedures a contract by the Florida Construction Industry Licensing Board for the preparation of a competency examination required of persons in order to engage in the construction industry. Although s. 112.313(3), F. S. 1975, prohibits a state employee from acting in a private capacity to sell goods or services to his public agency, the faculty members would not be doing business with their agency, the university, but with the licensing board. Section 112.313(7)(a) further prohibits a public employee from having "employment or a 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." Where the preparation of the competency examination is accomplished during the employees' personal time, however, no recurring conflict appears to be created inasmuch as the exam is administered and certifications awarded or denied not by the school of building construction or by the university, but by the state licensing board. Nor is s. 112.313(8), dealing with the disclosure or use of certain information, deemed to be applicable, as the ability to devise such an examination derives from one's expertise rather than from his university employment. Accordingly, no conflict of interest is found under the Code of Ethics, but the Ethics Commission lacks jurisdiction to advise as to any standards which may be imposed by the licensing board.

QUESTION:

Is a conflict of interest under the Code of Ethics for Public Officers and Employees created where a corporation whose stockholders are faculty members of a state university's school of building construction are awarded via competitive bid procedures a contract by the Florida Construction Industry Licensing Board for the preparation of the competency examination required of persons in order to engage in the construction industry?

Your question is answered in the negative.

In your letter of inquiry and in conversations with our staff you advise that you, Chairman of the School of Building Construction at the ____ and six of your colleagues in the school formed a corporation, ____, in the fall of 1976. The corporation bid for and was awarded a contract by the Florida Construction Industry Licensing Board for the preparation of its examination to ascertain the competency and qualifications of persons seeking to be certified by the board to engage in the construction industry. Prior to the award of that contract, members of the corporation disclosed to the president of your university your interest in the corporation and your intended activities.

You further advise that, when the examination contract again came up for bid in 1977, your corporation's bid was the lowest submitted but nevertheless was rejected at least partly because of what the board deemed to be an "apparent conflict of interest. " You write that while you do not question the board's authority in the bidding process, you and your colleagues do wish to have the question of conflict resolved.

The Code of Ethics for Public Officers and Employees as contained in part III, Ch. 112, F. S., prohibits a state employee from acting in a private capacity to sell goods or services to his public agency. Section 112.313(3). Inasmuch as your agency is the university by which you are employed [see s. 112.312(2)], however, no conflict is created pursuant to this provision of the law. The code further prohibits a public employee from having "employment or a 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." Section 112.313(7)(a). Based on the facts before us, the preparation of said competency examination, accomplished during your personal time away from university-related duties, does not appear to present a recurring conflict with those duties inasmuch as the exam is administered and certifications awarded or denied not by the school of building construction or by the university, but by the state licensing board.

The following provision of the Code of Ethics also is relevant to the situation described:

DISCLOSURE OR USE OF CERTAIN INFORMATION. -- No public officer or employee of an agency shall disclose or use information not available to members of the general public and gained by reason of his official position for his personal gain or benefit or for the personal gain or benefit of any other person or business entity. [Section 112.313(8), F. S.]

We have no reason to believe that you and your business associates have provided students in your school with materials directly from the examination prepared by your corporation, and you have personally assured our staff that neither you nor your associates coached students in this regard. It could be argued, however, that the expertise gained by reason of your public position and not enjoyed by others has been turned to your personal gain. But both your public position and your ability to contract for the examination service derive from prior education and experience which are inseparable, for all practical purposes, from that acquired during your university employment. That is, it is not your unique public position which enables you to enter the private contract but, rather, your particular area of expertise.

Finally, consideration must be given as to whether persons who have studied under you and your colleagues would not unfairly benefit by virtue of being acquainted with your particular philosophies, areas of emphasis, schools of thought, etc., all of which might reasonably be expected to be incorporated into an examination authored by you. You have acknowledged, in fact, that students who graduated from your university scored significantly higher on the exam in 1976 than did other candidates. You have further advised, however, that it is not unusual for the university graduates, as a whole, to achieve higher scores on the test, a fact which is largely attributable to their classroom backgrounds and familiarity with testing situations. In our view, too many variables exist to justify the conclusion that the university examinees specially benefit solely because instructors in the school participated in preparation of the examination. Furthermore, it is extremely doubtful that the imparting of classroom information to students by an instructor constitutes "disclosure" within the contemplation of s. 112.313(8), quoted above.

Accordingly, we find no prohibited conflict of interest under the Code of Ethics for Public Officers and Employees where a corporation whose membership consists of instructors of building construction at a state university contract with the Construction Industry Licensing Board for the preparation of construction licensing examinations. We wish to emphasize, however, that our jurisdiction extends only to the Code of Ethics. We recognize and encourage the adoption of ethical standards by various divisions of government, as individual agencies have unique responsibilities which may require ethical codes of a particular nature. Therefore, while we find no violation of the Code of Ethics in the contractual relationship you describe, we lack jurisdiction to advise you as to any standards which may be embraced by the licensing board.