CEO 92-13 -- March 6, 1992

CONFLICT OF INTEREST

DEPARTMENT OF TRANSPORTATION EMPLOYEE

PROCESSING MORTGAGE APPLICATIONS

To: Theodore R. Keyes, Right-of-Way Administrator I, Florida Department of Transportation (Jacksonville)

SUMMARY:

No prohibited conflict of interest would be created under the Section 112.313(7)(a), Florida Statutes, were a Right-of-Way Administrator I with District II of the Department of Transportation to accept and process applications for mortgages, as long as he does not process applications for persons displaced by Department projects or obtain referrals from realtors whom he contacts in his public capacity. These restrictions, as well as the geographical distance between his public and private employment, ensure that the proposed employment does not create a continuing or frequently recurring conflict of interest or one which impedes the full and faithful discharge of his public duties. The employee is cautioned to be mindful of the prohibition against misuse of position contained in Section 112.313(6), Florida Statutes, and against the use or disclosure of certain information pursuant to Section 112.313(8), Florida Statutes. CEO's 88-58, 88-1, and 87-92, are referenced.

QUESTION:

Would a prohibited conflict of interest be created were you, a relocation specialist employed by District II of the Florida Department of Transportation, to work for a mortgage broker processing mortgage applications?

Subject to the limitations expressed below, your question is answered in the negative.

In your letter of inquiry you advise that you are employed as a Right-of-Way Administrator I with District II of the Florida Department of Transportation. As a Right-of-Way Administrator, you serve as an assistant to the contract manager directing the relocation assistance and business damages program. You advisethat your work sometimes includes working with displaced homeowners or tenants who are purchasing homes. In this capacity you are called upon to review payments for these displaced persons, including payments for which they may be eligible to offset increases in the mortgage rates caused by the State's acquiring their home. However, you do not arrange mortgages for these persons, who either arrange for their own mortgage or work with their realtors or previous mortgage holders to obtain a mortgage. Your position with the Department also puts you in contact with realtors, who may either be working with a displacee, or whom you may contact to obtain data for a Department report.

You advise that you are interested in obtaining after-hours work with a mortgage broker, in which work you would accept and process applications for mortgages from prospective buyers and then transmit the finished package by facsimile to the underwriter's office. This would be done after hours in the applicant's home using a lap top computer and facsimile machine owned by you. Potential applicants will be referred to you by a group of realtors located in a specific geographic area, across the St. Johns River and in a separate county from where you work for the Department. You question whether the proposed arrangement would create a conflict of interest prohibited by the Code of Ethics for Public Officers and Employees.

Section 112.313(7)(a), Florida Statutes, 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.

This provision prohibits a public officer or employee from having an employment or contractual relationship with a business entity which is doing business with, or is regulated by, the agency of the officer or employee. It also prohibits public officers and employees from having an employment or contractual relationship which creates a continuing or frequently recurring conflict between their private interests and the performance of their public duties, or which impedes the full and faithful discharge of their public duties.

For purposes of the Code of Ethics, your "agency" would be District II of the Department of Transportation. See CEO 88-58. Therefore, under the first portion of Section 112.313(7)(a), Florida Statutes, you would be prohibited from having an employment or contractual relationship with a business entity which is doing business with or is regulated by District II of the Department. You advise that your employment relationship would be with a mortgage broker who neither does business with nor is regulated by the Department. Thus, no prohibited conflict of interest would exist under the first portion of Section 112.313(7)(a), Florida Statutes.

Under the second portion of Section 112.313(7)(a), Florida Statutes, you would be prohibited from having an employment or contractual relationship which creates a continuing or frequently recurring conflict between your private interests and the performance of your public duties, or which impedes the full and faithful discharge of your public duties. Were you to solicit persons displaced by Department projects or realtors whom you contact in your official capacity, you could be in violation of this provision. However, you have attempted to ensure that this will not occur because you state that you will not accept applications from persons displaced by Department projects and your after-hours contacts with realtors will be limited to a group working in the Middleburg, Florida area where you reside, across the St. Johns River and in another county from the area where you work for the Department. Because you will not be accepting and processing mortgage applications in the area where displacements are going to occur, this situation does not create a frequently recurring conflict of interest or one which impedes the full and faithful discharge of your public duties. See CEO 87-92, in which we advised an investigator who worked for a public defender's office that he could be employed as a bail bondsman as long as he did not write bonds for clients of that office. See also CEO 88-1, in which we opined that no prohibited conflict of interest was created where employees of a county property appraiser privately appraised property located outside of the county where they were employed.

However, please note that you are also prohibited by the following provisions of the Code of Ethics from misusing your official position and from disclosing or using information not available to the general public for your personal benefit:

MISUSE OF PUBLIC POSITION.--No public officer or employee of an agency shall corruptly use or attempt to use his official position or any property or resource which may be within his trust, or perform his official duties, to secure a special privilege, benefit, or exemption for himself or others. This section shall not be construed to conflict with s. 104.31. [Section 112.313(6), Florida Statutes (1991).]

DISCLOSURE OR USE OF CERTAIN INFORMATION.--No public officer or employee of an agency shall disclose or use information not available to members of the general public and gained by reason of his official position for his personal gain or benefit or for the personal gain or benefit of any other person or business entity. [Section 112.313(8), Florida Statutes (1991).]

We would caution you that were you to use the Department's resources or equipment to process applications, your actions could violate Section 112.313(6), Florida Statutes. Where you use information not available to the general public and gained by reason of your employment with the Department, you also could violate Section 112.313(8), Florida Statutes. Thus, you should be mindful of these provisions as well as the above-noted restrictions should you undertake your proposed employment.

Your question is answered accordingly.