CEO 91-63 -- October 25, 1991

CONFLICT OF INTEREST

CITY COMMISSIONER AND DEPARTMENT DIRECTOR

SERVING ON CITY PENSION BOARD

To: Marsha A. Rewolinski, Assistant Administrator, City of Key West General Employees' Pension Board

SUMMARY:

No prohibited conflict of interest exists under Section 112.313(7)(a), Florida Statutes, where a city commissioner and a city employee serve on the city's pension board. The city commissioner serves on the board pursuant to the city code. With regard to the city employee, as he is not presently receiving pension benefits, he has no tangible, present-day interest which might conflict with his duties on the board, and there is no indication that his employment with the city would be impeded by his service on the Board. CEO's 88-73 and 86-10 are referenced.

QUESTION:

Does a prohibited conflict of interest exist where an elected City official and a City employee serve as members of the City of Key West General Employees Pension Board?

Your question is answered in the negative.

In your letter of inquiry and in supplemental information provided to our staff, you advise that both a City employee who is director of a City Department and an elected member of the Key West City Commission serve on the City of Key West General Employees Pension Board. These individuals question whether their service on the Board creates a conflict of interest prohibited by Chapter 112, Part III, Florida Statutes.

The applicable provision of the Code of Ethics for Public Officers and Employees is Section 112.313(7)(a), Florida Statutes, which 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.

Under this provision, public officers and employees are prohibited from having any employment or contractual relationship that would create a continuing or frequently recurring conflict between their private interests and the performance of their public duties.

With regard to the City Commissioner serving on the Pension Board, you have indicated that she is not a participant in the pension plan. In addition, it does not appear that she would have any "employment" because her service in both capacities arises from her holding public offices rather than holding any employment. Therefore, it does not appear that her service on the Pension Board and her service on the City Commission would involve any employment or contractual relationship or create any conflict between her private interests and the performance of her public duties.

Moreover, the City Code provision creating the Pension Board requires that one member of the City Commission be appointed to serve on the Board. Section 112.313(7)(b), Florida Statutes, provides:

This subsection shall not prohibit a public officer or employee from practicing in a particular profession or occupation when such practice by persons holding such public office or employment is required or permitted by law or ordinance.

This provision would allow the City Commissioner to remain on the City Commission while simultaneously serving on the Pension Board. See CEO 86-10.

With regard to the City Department Director serving on the Board, you have indicated that he is the fifth member of the Board and was elected to that position by the other four members of the Board. You also advise that he is a participant in the pension plan but is not yet vested. He will become 50% vested in 1995. Therefore, he has no present right to receive any benefits under the plan. In CEO 88-73, we considered a similar situation where a former city employee was elected to the city commission, and where the commission administered the city pension fund. There, it was determined that the officer was not receiving any tangible benefit of real, present-day value and that his relationship with the pension fund did not present such a continuing or frequently recurring conflict of interest so as to disqualify him from serving. Applying that rationale to the situation before us, we do not view the City Department Director's service on the Pension Board to create a continuing or frequently recurring conflict between his private, prospective interest in receiving pension benefits and his duties on the Board. Nor is there any specific indication that his employment as a Department head with the City would conflict with his service on the Board.

As in CEO 88-73, we point out that local officials are governed by the following provision of the Code of Ethics:

No county, municipal, or other local public officer shall vote in his official capacity upon any measure which would inure to his special private gain; which he knows would inure to the special private gain of any principal by whom he is retained or to the parent organization or subsidiary of a corporate principal by which he is retained, other than an agency as defined in s. 112.312(2); or which he knows would inure to the special private gain of a relative or business associate of the public officer. 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. [Section 112.3143(3)(a), Florida Statutes (1991).]

The Board member may wish to contact this Commission for further advice with respect to matters that might inure to his special private gain.

Accordingly, we find that no prohibited conflict of interest would be created were a City Commissioner to serve on the City's General Employees Pension Board, or where a City employee is partially vested in the pension fund and serves on the Board.