CEO 91-8 -- January 30, 1991

CONFLICT OF INTEREST

STATE REPRESENTATIVE PRINCIPAL OF CORPORATION

DEVELOPING COUNTY DETENTION FACILITIES

To: The Honorable R. Z. Safley, State Representative, District 50 (Palm Harbor)

SUMMARY:

No prohibited conflict of interest exists under the Code of Ethics for Public Officers and Employees where a State Representative is an officer and shareholder of a corporation that is engaged in the business of developing detention facilities that would be operated and managed by the sheriff or the chief correctional officer of a county. Under Section 112.313(7)(a)2, Florida Statutes, when the official's agency is a legislative body and the regulatory power exercised by that body is strictly through the enactment of laws, then employment or contractual relationships with agencies or business entities that may be regulated by the legislative body are not prohibited. As the Representative will not represent the corporation before the Department of Corrections, the prohibitions of Article II, Section 8(e), Florida Constitution, and Section 112.3141(1)(c), Florida Statutes, against representing another person or entity for compensation before State agencies other than judicial tribunals, would not be violated.

QUESTION:

Does a prohibited conflict of interest exist where you, a State Representative, are an officer and shareholder of a corporation that is engaged in the business of developing detention facilities that would be operated and managed by the sheriff or the chief correctional officer of a county?

Your question is answered in the negative.

In your letter of inquiry you advise that you are a member of the Florida House of Representatives; among other committee assignments, you serve as a member of the House CorrectionsCommittee and its Prison Construction and Operations Subcommittee. You also advise that you are an officer and a shareholder of a corporation that is engaged in the business of developing detention facilities that would be operated and managed by the sheriff or the chief correctional officer of a county and that would be made available for use by federal agencies.

It is expected that the federal agencies would pay a per diem rate to the corporation for each federal prisoner housed in the facility. The corporation in turn would pay a per diem to the sheriff or the county for the operation and management of the facility, retaining a portion of the federal payments to amortize the costs of constructing the facility. A certain number of beds within the facility would be available for use by the sheriff or the county. Title to the facility would be transferred to the county in approximately 10 years.

You advise that county detention facilities are subject to the regulation and oversight of the State Department of Corrections, pursuant to Section 951.23, Florida Statutes. The Department is authorized to adopt and enforce rules that prescribe minimum standards and requirements for the construction, maintenance, and operation of county detention facilities and has done so through Chapter 33-8, Florida Administrative Code.

You will not represent the corporation before the Department regarding the facilities to be developed, you advise, although other employees of the firm may have such contacts. You do anticipate having numerous contacts with representatives of the Department regarding legislative issues pending before the Corrections Committee, and you expect that legislation may come before the Committee that will address Section 951.23 in the general sense of being applicable to all county detention facilities.

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), Florida Statutes.]

This provision prohibits a public officer from having employment or a contractual relationship with a business entity or an agency that is subject to the regulation of his agency. However, as we have noted in several opinions, Section 112.313(7)(a)2 provides that when the agency is a legislative body and the regulatory power exercised by that body is strictly through the enactment of laws, then the employment or contractual relationship is not prohibited.

Under these provisions, we have concluded that a State Representative, who was serving as Chairman of the House Subcommittee on Prison Overcrowding, could be employed as a consultant by a corporation in the business of constructing and managing correctional facilities in order to assist the corporation in locating sites for facilities and making the necessary contacts with city and county governments. See CEO 84-21. In CEO 87-47 we advised that a State Representative who chaired the Appropriations Education Subcommittee would not be prohibited from investing in a portable classroom building company which would do business with public schools, community colleges, and universities. In CEO 88-15, we advised that the Chairman of the House Committee on Corrections, Probation, and Parole could serve on an advisory board to a corporation that was involved in contractual prison projects with the Department of Corrections.

In each of these instances, we found that the pertinent regulatory authority of the Legislature was expressed through the enactment of laws. Similarly, here, the regulatory authority of the Legislature regarding correctional facilities has been exercised through the enactment of laws, and the exemption for legislative bodies provided in Section 112.313(7)(a)2 is applicable.

You have advised that you will not be representing the corporation before the Department of Corrections. Therefore, the requirements of Article II, Section 8(e), Florida Constitution, and Section 112.3141(1)(c), Florida Statutes, which prohibit legislators from representing another person or entity for compensation before State agencies other than judicial tribunals, will be met. Finally, for general information regarding voting conflicts of interest, we direct your attention to CEO 87-24 (State Representative on Committee on Regulated Industries and Licensing owning liquor license and voting on legislation relating to liquor industry).

Accordingly, we find that no prohibited conflict of interest exists where you, a State Representative, are an officer and shareholder of a corporation that is engaged in the business of developing detention facilities that would be operated and managed by the sheriff or the chief correctional officer of a county.