CEO 81-3 -- February 20, 1981

CONFLICT OF INTEREST

CITY EMPLOYEE ACTING AS REAL ESTATE SALESMAN

To: Gene M. Eddinger, Assistant City Manager, Plant City

SUMMARY:

Although an assistant director of public works employed by a city engineering department would not absolutely be prohibited from engaging, in his private capacity as a real estate salesman, in real estate transactions within the jurisdiction of the city, the second clause of s. 112.313(7)(a) would be violated were he to have an interest in the sale of property the improvement of which is being regulated by the engineering department. Thus, for example, he is prohibited from having any interest as a real estate salesman in a subdivision until after the engineering department has completed its role in approving the plat and improvements made within the subdivision. This precludes the possibility that he might be influenced in making and recommending engineering decisions which could favor his private business, thus impeding the full and faithful discharge of his public duties. His attention also is directed to s. 112.313(8), prohibiting the disclosure or use of inside information for private gain.

QUESTION:

Would a prohibited conflict of interest exist were an assistant director of public works who is employed by a city engineering department and who is also a registered real estate salesman to engage in real estate transactions within the jurisdiction of the city?

This question is answered in the negative, subject to certain restrictions expressed below.

In your letter of inquiry you advise that James W. Shira is employed by the City of Plant City Engineering Department as an Assistant Director of Public Works. You also advise that the duties of the Assistant Director of Public Works involve the engineering and inspection of public utilities and improvements such as roads, sewers, water mains, and sidewalks. The Assistant Director also participates in the review of plats for proposed subdivisions and site reviews for other proposed capital improvements. In addition, you advise that, although the Assistant Director recommends his engineering decisions to the City Engineer/Public Works Director, who has final authority over all engineering matters within the department, the recommendations of the Assistant Director largely are accepted by the Director without close scrutiny, unless a problem is reported by the Assistant Director.

Section 112.313(7)(a), F. S., provides as follows:

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 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 private interests and the performance of his public duties or that would impede the full and faithful discharge of his public duties.

It is clear that the Assistant Director has a contractual relationship with the real estate firm with which he is associated as a salesman. Under the facts that you have presented, it does not appear that this real estate firm is doing business with the City Engineering Department, which is the "agency" of the Assistant Director. Nor is the real estate firm subject to the regulation of the department, as real estate brokers and salesmen are regulated by the Florida Real Estate Commission under Chapter 475, F. S.

Therefore, the first portion of Section 112.313(7)(a) does not apply. However, we are of the opinion that the second portion of Section 112.313(7)(a) would prohibit the Assistant Director from having an interest as a real estate salesman in the sale of property, the improvement of which is being regulated by the Engineering Department. Thus, for example, he is prohibited from having any interest as a real estate salesman in a subdivision until after the engineering department has completed its role in approving the plat and improvements made within the subdivision. This precludes the possibility that, due to the subject employee's interest in a real estate transaction, he may be influenced in making and recommending engineering decisions which could favor his private business. In addition, he is placed in the same position as other real estate brokers and salesmen, who would not have access to the same information until after the engineering department had completed the exercise of its responsibilities. Thus, he would not be prohibited from participating in all types of real estate transactions within the city. For example, we do not perceive a prohibited conflict of interest in his participating in the sale of residential properties which does not involve any participation or review by the engineering department.

As we have not been provided with more detailed circumstances, we are unable to give more than this general guidance. If specific circumstances arise in the future, we urge you to request another advisory opinion at that time.

The subject employee should be made aware that the Code of Ethics contains a prohibition against using or disclosing information gained by virtue of his public position before such information becomes available to the public. Section 112.313(8), F. S. We would urge the subject employee to be particularly cautious in his activities as a real estate salesman and associate of a real estate firm to avoid even the appearance that he has used information gained through his public position to benefit either himself or the real estate firm with which he is associated.

Accordingly, subject to the restrictions expressed above, we find that the Code of Ethics for Public Officers and Employees does not prohibit the subject employee from engaging in real estate transactions within the City as a registered real estate salesman while being employed by the City Engineering Department as Assistant Director of Public Works.