CEO 77-88 -- June 17, 1977

CONFLICT OF INTEREST

COUNTY COMMISSIONER CONTRACTING WITH BOARD OF COUNTY COMMISSIONERS AS LANDLORD PURSUANT TO H.U.D. PROGRAM

To: Kenneth A. Jones, Assistant Lee County Attorney, Fort Myers

Prepared by: Phil Claypool

SUMMARY:

A prohibited conflict of interest would be created were a county commissioner to enter into a contractual relationship with a county housing assistance office as a landlord pursuant to the H.U.D. s. 8 Housing Assistance Payments Program. Section 112.313(7)(a), F. S. 1975, prohibits a public officer from having a contractual relationship with a business entity or agency which is subject to the regulation of or is doing business with his agency. While the subject commissioner would have a contractual relationship with his tenant were he to participate in the s. 8 program, a residential tenant is not deemed to constitute a "business entity" as that term is defined in s. 112.312(3). However, in order to participate in the program as a landlord, the subject commissioner will have to enter into a contract (the housing assistance payments contract) with the county housing assistance office which, as a county agency, is subject to the regulation of the board of county commissioners.

QUESTION:

Would a prohibited conflict of interest exist were a county commissioner to enter into a contractual relationship with a county housing assistance office as a landlord pursuant to the H.U.D. s. 8 Housing Assistance Payments Program?

Your question is answered in the affirmative.

In your letter of inquiry and in a subsequent telephone conversation with our staff, you have stated that the Lee County Board of County Commissioners approved that county's participation in the U.S. Department of Housing and Urban Development s. 8 Housing Assistance Payments Program on December 23, 1975. In November of 1976 Mr. Dick Steele was elected to the board of county commissioners. Commissioner Steele owns a mobile home which he wishes to rent to a tenant under the s. 8 program. However, since one of the requirements of this program as it has been implemented in Lee County is that the landlord must enter into a contract with the County Housing Assistance Office, the subject commissioner has asked you to request an advisory opinion as to the propriety of his entering into such a contract.

The s. 8 program was established for the purpose of aiding lower- income families in obtaining decent housing and of promoting economically mixed housing. 42 U.S.C. s. 1437 f(a). Under the program the U.S. Department of Housing and Urban Development (H.U.D.) makes payments to a local public housing agency (P.H.A.), which in turn makes direct payments to landlords in order to subsidize the rents of their lower-income tenants. The program is implemented in the following steps: The P.H.A., which here is the county housing assistance office, enters into a contract with H.U.D., called the annual contributions contract; the P.H.A. certifies potential tenants as eligible families under the program; the certificate holder locates an existing housing unit; the owner of that existing housing unit, who in this case would be the subject commissioner, enters into a contract with the P.H.A., called the housing assistance payments contract; the P.H.A. approves the lease between the certificate holder and the owner; and the P.H.A. makes assistance payments directly to the owner which subsidize the rent paid from the tenant to the owner. 24 C.F.R. Part 882 (1976).

According to the program coordinator for the housing assistance office, as verified by the H.U.D. rules and regulations found at 24 C.F.R. s. 882, implementation of the s. 8 program is closely regulated by H.U.D. The contracts used in the program are furnished by H.U.D. or contract terms are strictly specified by H.U.D. rules. Guidelines for certifying applicants, amounts of rent received, and assistance payments are determined according to H.U.D. specifications, as are housing quality standards. The records of each P.H.A. are periodically audited and inspected by a H.U.D. representative.

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. 1975.]

The first part of this provision prohibits a public officer from having a contractual relationship with a business entity or agency which is subject to the regulation of or is doing business with his agency.

While the subject commissioner would have a contractual relationship with his tenant were he to participate in the s. 8 program, in our view a residential tenant does not constitute a "business entity" as that term is defined in s. 112.312(3), F. S. 1975. See CEO 76-3 (question 2). However, in order to participate in the program as a landlord, the subject commissioner will have to enter into a contract (the housing assistance payments contract) with the Lee County Housing Assistance Office which, as a county agency, is subject to the regulation of the board of county commissioners. Thus, the subject commissioner is prohibited by s. 112.313(7)(a) from entering into such a contract.