CEO 81-36 -- June 18, 1981

CONFLICT OF INTEREST

DIRECTOR OF COUNTY PUBLIC TRANSPORTATION SYSTEM HAVING CONTRACTUAL RELATIONSHIP WITH TRANSPORTATION COMPANY OWNED BY SPOUSE

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

SUMMARY:

No prohibited conflict of interest would be created were a corporation which is owned by the wife of the director of a county public transportation system and which is the obligor on a promissory note to him to receive an exclusive limousine and taxicab concession at the county airport. Section 112.313(3), F. S., does not apply because the corporation would not be selling services to the county and because the transportation system director has no responsibility for contracts entered into between the county and the corporation. In addition, Section 112.313(7)(a), F. S., would not apply. The corporation is not doing business with the director's "agency" and is not subject to the regulation of that "agency." Nor would the director's interest as a creditor of the corporation create a continuing or frequently recurring conflict of interest or impede the full and faithful discharge of his duties under the circumstances presented.

QUESTION:

Would a prohibited conflict of interest be created were a corporation which is owned by your wife and with which you have a contractual relationship to receive an exclusive limousine and taxicab concession at a county airport while you serve as director of the county's public transportation system?

Your question is answered in the negative.

In a telephone conversation and through previous communications with our staff, you have advised that you are the Director of the Lee County Transit System. Your job description indicates that you are responsible for directing the operations of the transit system under the general direction of the Director of the County's Division of Transportation and Public Works. In addition to its transit responsibilities, the Division of Transportation and Public Works is responsible for bridge operations, engineering, roads and bridges, and water and drainage matters. As part of your duties, you are responsible for planning, organizing, and administering the work of the transit system staff; compiling data regarding operating achievements and costs; directing surveys to determine transit needs and evaluating the adequacy of present programs and schedules; marketing the services of the transit system; planning and recommending programs for federal grants; preparing annual budget estimates; approving changes in transit routes and schedules; investigating complaints; and settling contracts related to the transit system. Route changes are made by the County Commission upon your recommendation, you advised, and fare amendments or route changes are usually brought up once a year in connection with the budget of the transit system.

Previously, you advised, you were an officer and shareholder with your wife in a transportation company. At present, you have resigned your position as an officer and maintain no economic interest in the corporation other than a promissory note given by the corporation in exchange for the shares of stock which you owned. Occasionally, you advised, you assist the company as a driver, but in such instances you do not receive any compensation; nor do you drive while on County time. The company owns one charter bus and two mini vans which are used for sightseeing, charters, and taxicab services. Although the corporation is required to obtain an occupational license from the County, the County has no ordinances which provide how the company is to operate, and the County neither has set uniform rates for taxicabs nor established an agency which would regulate the company.

You further advised that in the future the County may award a concession for exclusive limousine and taxi rights at the County airport. This concession would be awarded by the County Commission, with specifications for bids or proposals being prepared by the County Attorney and the County Division of Airports, which is responsible for all concessions at the airport. Neither you nor the Division of Transportation and Public Works would be responsible for preparing bid specifications for the award of the bid. In the past, you advised, bus transportation was made available at the airport; however, this route was changed at the request of the Division of Airports, so that presently bus service is available at the perimeter of the Airport.

The Code of Ethics for Public Officers and Employees provides in 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.

[Section 112.313(3), F. S. (1979).]

This provision prohibits you from acting in an official capacity as a purchasing agent to purchase any services for your agency from a business entity of which your spouse is an officer, director, or owner of greater than a five percent interest. However, we find that this prohibition does not apply to the situation you have described. We find that your "agency," as the term is defined in Section 112.312(2), F. S., is the County Division of Transportation and Public Works. It is apparent that in your official capacity you have no responsibility for contracts entered into between the County and your wife's corporation. In addition, it does not appear that the corporation would be selling services to the County; rather, the corporation would be selling services to its passengers.

The second sentence of Section 112.313(3) prohibits you from acting in a private capacity to sell any services to any agency of the County. Again, we find that this prohibition would not apply because the corporation would not be selling any services to the County.

The Code of Ethics also provides:

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. [Section 112.313(7)(a), F. S. (1979).]

The first part of this provision prohibits you from having any employment or contractual relationship with a business entity which is doing business with your agency or which is subject to the regulation of your agency. As noted above, your "agency" is the Division of Transportation and Public Works. Since it is the Division of Airports which would be responsible for the limousine and taxicab concession at the Airport, we find that this prohibition does not apply.

The second part of Section 112.313(7)(a) prohibits you from having any employment or contractual relationship that will create a continuing or frequently recurring conflict between your private interests and the performance of your public duties or that would impede the full and faithful discharge of your public duties. We note that you are not in a position to give advice or recommendations to the County concerning the operations of your wife's company. In addition, based on the past experience you have related, it appears unlikely that public transportation will be directly in competition with taxicabs or limousine service at the airport. We do perceive the possibility of a conflict between your duty to recommend transit route changes to the County Commission and your interest as a creditor in your wife's corporation. However, under the circumstances you have presented, we do not find that this possibility would present so significant and substantial a conflict of interest as to impede the full and faithful discharge of your public duties or result in a continuing or frequently recurring conflict with your duties.

Accordingly, we find that no prohibited conflict of interest would be created were the corporation owned by your wife to receive an exclusive limousine and taxicab concession at the County airport while you serve as Director of the County transportation system.