CEO 88-24 -- April 28, 1988

CONFLICT OF INTEREST

SCHOOL BOARD MEMBER EMPLOYED BY PRIVATE UNIVERSITY

DOING BUSINESS WITH SCHOOL DISTRICT

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

SUMMARY:

A prohibited conflict of interest exists under Section 112.313(7)(a), Florida Statutes, where a school board member is employed by a private, nonprofit university which is doing business with the school district, unless one of the exemptions provided in Section 112.313(12), Florida Statutes, applies. Additionally, the school board member would be prohibited under Section 112.3143(3), Florida Statutes, from knowingly voting in her official capacity upon any matter which would inure to the special gain of the university. CEO's 82-9, 86-80, and 84-108 are referenced.

QUESTION 1:

Does a prohibited conflict of interest exist under Section 112.313(7)(a), Florida Statutes, where you, a school board member, are employed by a private, nonprofit university, which has entered into certain contracts and relationships with the school district?

Under the circumstances presented, your question is answered in the affirmative.

In your letter of inquiry you advise that you were appointed as a member of the Dade County School Board in September, 1986. Prior to your appointment, you were employed by the University of Miami, a private, nonprofit corporation, as a faculty member in the School of Education. You continue to serve in that capacity.

You advise that you are the Director of the National Origin Desegregation Assistance Center, the Director of the Bilingual Education Training Program for Administrators, the Chairperson of a School of Education Task Force on Cultural Innovation, and the Director of an Institute for Cultural Innovation at the University of Miami. The services of the National Origin Desegregation Assistance Center are provided at no cost to school districts, including the Dade County School Board. The services of the Bilingual Education Training Program for Administrators likewise are provided free of charge to teachers, some of whom are employed by the Dade County School Board. The School of Education Task Force on Cultural Innovation does no business with the Dade County School Board. You further advise that certain contracts and relationships exist between the School Board and the University which amount to "cooperative educational exchanges," and that the School Board occasionally rents facilities from the University for dramatic performances and athletic events.

You question whether your employment with the University of Miami creates a prohibited conflict of interest under Section 112.313(7)(a), Florida Statutes. That section 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), Florida Statutes (1987).]

This provision prohibits a public officer from having any employment with a business entity which is subject to the regulation of, or doing business with, her agency.

The nonprofit corporation which employs you is a "business entity." See CEO 82-9, in which the nonprofit organization involved was found to be a "business entity." That term is broadly defined in Section 112.312(3), Florida Statutes, to include "any corporation . . . doing business in this state," making no distinction based upon the fact that a corporation has been organized as a profit-making or a nonprofit enterprise.

Clearly, the University of Miami is not regulated by the Dade County School Board. However, we find that the University is "doing business" with the School Board as a result of certain agreements and contracts. In the past we have advised that a business entity is doing business with an agency where the parties have entered into a lease, contract, or other type of legal arrangement under which one party would have a cause of action against the other in the event of a default or breach. You have provided us with what you classified as a summary of cooperative activities between the School Board and the University which had been prepared by the School Board's staff at your request. This list includes instances in which the University conducts research at District schools and School District faculty enjoy University privileges and participate in the research. University students provide instruction in some District classrooms, and there is also an occasional joint facility use. The University provides scientists and laboratories at no charge for District students in a gifted program, and the District and University have created a joint writing institute where the District pays the tuition for teachers to improve composition skills. Additionally, the University sponsors workshops in which School District personnel participate and has provided the District with support in teacher training.

In a telephone conversation with our staff, the University of Miami General Counsel further advised that the University and District cooperatively administer certain programs. He also stated that District teachers receive reduced tuition rates at the University. He further advised that the University of Miami occasionally leases its facilities to the Dade County School Board for dramatic performances and athletic events.

Upon a written request from our staff for a list of agreements and/or contracts between the University and the School Board, the Attorney for the School Board provided a collection of descriptive materials with respect to programs or activities involving the University and the School Board. The University of Miami General Counsel reviewed this information and stated that it was duplicative of materials found at the University. He added that the School of Nursing has an affiliation agreement with the District to assist in a program which helps pregnant students, and that various University clubs enter into facilities use agreements with the School Board to use school sites for various activities. While these clubs are affiliated with the University, they do not engage in any business on behalf of the University, he stated. Also, he advised, agreements for the use of University facilities by the School Board for its programs have included rental of a concert hall for a musical performance, a baseball field for certain tournament games, and an art museum. He further advised that each daily use of these facilities was for a cost of less than $500.

In a telephone conversation with School Board staff, our staff requested copies of the contractual agreements between the University and the School Board. Although the Assistant Board Attorney responded that these agreements were "spread throughout the system" and that she had not been able to obtain all of them, she provided examples of four such agreements. One of these agreements between the University and the School Board is designated as a cooperative effort on behalf of both parties in providing hearing-impaired students a free and appropriate education and specialized speech services. The University provides classroom space and equipment, while the School Board provides program funding to be paid at the end of each month at the rate of $23,656 per month. Another one of these agreements is for the use of University facilities in which the School Board agrees to pay $1,905.75 for the use of a concert hall during a music festival. Still another agreement provides for the School Board to pay the University an amount not to exceed $14,726 for instructional faculty to provide five and one-half days of training pertaining to chemical dependency for certain project specialists.

Thus, it appears that under a number of these agreements the University and the School Board are "doing business" within our interpretation of that term. Please be advised, however, that the Code of Ethics provides several exemptions in Section 112.313(12), Florida Statutes, to the prohibitions of Section 112.313(7)(a). That is, if the business transacted between the University and the School Board falls within one or more of these exemptions, then the relationships between the two entities would not create a prohibited conflict of interest under the Code of Ethics.

In particular, we note that under Section 112.313(12)(b), Florida Statutes, the School Board could do business with the University by a system of sealed, competitive bidding so long as you abstain from decisions relating to the bid and file Commission on Ethics Form 3A, Interest in Competitive Bid for Public Business, with the local supervisor of elections. In addition, Section 112.313(12)(e), Florida Statutes, would allow a school board member to have an employment relationship with a business entity doing business with the school board as long as the business entity was the sole source of supply within the county, and the school board member disclosed her interest to the school board on Commission on Ethics Form 4A, Disclosure of Business Transaction, Relationship, or Interest, prior to the transaction. Finally, Section 112.313(12(f), Florida Statutes, would allow an exemption where the total amount of the subject transaction did not exceed $500. See CEO 86-80.

Accordingly, we conclude that a prohibited conflict of interest would be created under Section 112.313(7)(a), Florida Statutes, by virtue of your employment with the University of Miami, unless the business transacted between the School District and the University falls within one of the exemptions provided in Section 112.313(12), Florida Statutes.

QUESTION 2:

Are you, a school board member, prohibited by Section 112.3143, Florida Statutes, from voting on any measure which would inure to the special benefit of the private university which employs you?

Your question is answered in the affirmative, subject to the limitation noted below.

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

No county, municipal, or other local public officer shall vote in his official capacity upon any measure which inures to his special private gain or shall knowingly vote in his official capacity upon any measure which inures to the special gain of any principal, other than an agency as defined in s. 112.312(2), by whom he is retained. Such public officer shall, prior to the vote being taken, publicly state to the assembly the nature of his interest in the matter from which he is abstaining from voting and, within 15 days after the vote occurs, disclose the nature of his interest as a public record in a memorandum filed with the person responsible for recording the minutes of the meeting, who shall incorporate the memorandum in the minutes. However, a commissioner of a community redevelopment agency created or designated pursuant to s. 163.356 or s. 163.357 or an officer of an independent special tax district elected on a one- acre, one-vote basis is not prohibited from voting. [Section 112.3143(3), Florida Statutes (1987).]

This provision prevents a school board member from knowingly voting in her official capacity upon any measure which inures to the special gain of a principal by whom she is retained. In previous opinions, we have advised that a public official's employer is a "principal by whom [s]he is retained." See CEO 84-108, and the opinions cited therein. By prohibiting an official from "knowingly" voting on matters which inure to the special gain of her employer, the law recognizes that a public official, like any other employee, may not be aware of all of her employer's interests and should not be held accountable for matters she is not in a position to know. However, subject to this limitation, the requirements of Section 112.3143(3) would apply when you are called upon to consider measures inuring to the special gain of the University.

Your questions are answered accordingly.