CEO 81-87 -- December 18, 1981

CONFLICT OF INTEREST

COUNTY HOUSING AUTHORITY MEMBER AND EXECUTIVE DIRECTOR CONTRACTING WITH HOUSING AUTHORITY AS LANDLORD PURSUANT TO H.U.D. PROGRAM

To: Terry D. McKnight, Attorney for Pasco County Housing Authority, Zephyrhills

SUMMARY:

A prohibited conflict of interest would exist where a member of a county housing authority is employed by a corporation which has contracted with the housing authority as a landlord under the authority's Existing Section 8 program of rent subsidies. In CEO 77-88, we advised that a prohibited conflict of interest would exist were a county commissioner to enter into a contractual relationship with a county housing assistance office as a landlord pursuant to this program. Here, the authority commissioner would be employed with a business entity which is doing business with the authority by virtue of the rent subsidy which it receives from the authority for each tenant under the Existing Section 8 program. Should the housing authority enter into an agreement with a neighboring authority under which the neighboring authority would administer the units owned by the subject commissioner's employer, the conflict of interest would be eliminated. Similarly, a prohibited conflict of interest exists where the executive director of a county housing authority is the sole owner of a corporation which owns a mobile home park in which two tenants receive Existing Section 8 rental assistance from the authority.

QUESTION 1:

Does a prohibited conflict of interest exist where a member of a county housing authority is employed by a corporation which has contracted with the housing authority as a landlord under the authority's Existing Section 8 program of rent subsidies?

Your question is answered in the affirmative.

In your letter of inquiry you advise that Mr. Wilson W. Hendricks, Jr., who recently has been appointed to the Board of Commissioners of the Pasco County Housing Authority, is employed by a corporation which owns an apartment complex in which units are rented to tenants who receive rental assistance from the Housing Authority. While the majority of the units do not involve the Housing Authority, two of them currently are rented under the Authority's Existing Section 8 Program, in which the Authority pays a housing subsidy to a private landlord in behalf of a tenant. In addition, you advise that it is possible that four more tenants may become eligible for assistance under the program. The operation of the program has been outlined in CEO 77-88, in which we advised that a prohibited conflict of interest would exist were a county commissioner to enter into a contractual relationship with a county housing assistance office as a landlord pursuant to this program.

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

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.]

This provision prohibits a public officer from being employed with a business entity which is doing business with or is subject to the regulation of his agency. We are of the opinion that the corporation which employs the subject Authority Commissioner is doing business with the Authority by virtue of the rent subsidy which it receives from the Authority for each tenant under the Existing Section 8 Program. In addition, in a telephone conversation with our staff, you advise that units under the Existing Section 8 Program are subject to inspection by the Housing Authority to determine whether they meet H.U.D. minimal property standards.

Accordingly, we find that a prohibited conflict of interest exists where a Housing Authority Commissioner is employed by a corporation which receives housing subsidy payments from the Authority under the H.U.D. Existing Section 8 Program. In your letter of inquiry you advise that it is possible that the Housing Authority may enter into an agreement with a neighboring housing authority under which the neighboring authority would administer the units owned by the subject Commissioner's employer. We are of the opinion that such an agreement would obviate the conflict of interest, as the Housing Authority no longer would be doing business with or regulating in any manner the subject Commissioner's employer.

Your second question, posed in behalf of Mr. Daniel O. Culliton, is substantially as follows:

QUESTION 2:

Does a prohibited conflict of interest exist where the executive director of a county housing authority is the sole owner of a corporation which owns a mobile home park in which two tenants receive Existing Section 8 rental assistance from the authority?

In your letter of inquiry you advise that Mr. Culliton recently was appointed Executive Director of the Pasco County Housing Authority. In addition, you advise that he is the sole stockholder in a corporation which owns a mobile home park in which two tenants receive Existing Section 8 rental assistance from the Authority.

We are of the opinion that the rationale of our response to your first question applies equally to this question, which we answer in the affirmative.