CEO 83-8 -- January 27, 1983

CONFLICT OF INTEREST

FORMER EMPLOYEE OF DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES BEING EMPLOYED BY NONPROFIT CORPORATION CONTRACTING WITH THE DEPARTMENT

To: Mr. Terrell R. Harper, District Program Specialist, D.H.R.S. District V Alcohol, Drug Abuse, and Mental Health Program Office

SUMMARY:

Section 112.3185, Florida Statutes, would not prohibit a District Program Specialist in the District V Alcohol, Drug Abuse, and Mental Health Program Office of the Department of Health and Rehabilitative Services from leaving the Department for employment with a nonprofit corporation which has contracted with the District Mental Health Board to provide community mental health and community alcohol services, where he has been responsible for the annual monitoring of the corporation's alcohol detoxification program. Here the employee was not involved in any capacity in the procurement or development of the contracts with the corporation. In addition, the alcohol detoxification program monitored by the employee does not constitute a "contractual service" within the meaning of Section 112.3185(4), as it is excluded from the definition of "contractual service" appearing in Section 287.012(3), Florida Statutes.

QUESTION:

Would the Code of Ethics for Public Officers and Employees be violated were you, a District Program Specialist in the District V Alcohol, Drug Abuse, and Mental Health Program Office of the Department of Health and Rehabilitative Services, to leave the Department for employment with a nonprofit corporation which has contracted with the District Mental Health Board to provide community mental health and community alcohol services, where you have been responsible for the annual monitoring of the corporation's alcohol detoxification program?

Your question is answered in the negative.

In your letter of inquiry you advise that currently you are a District Program Specialist in the District V Alcohol, Drug Abuse, and Mental Health Program Office of the Department of Health and Rehabilitative Services. You also advise that you have been offered the position of Director of Centralized Services with a private, nonprofit corporation which is designated and funded as a comprehensive community mental health center. The corporation receives State and federal funding through contracts with the District Mental Health Board. As Director of Centralized Services, your duties will include administering the corporation's alcohol detoxification program, crisis stabilization unit, release-on-own- recognizance court program, mental health emergency services, mental health half-way house and family intervention team (child abuse).

In your present position with the Department, your responsibilities have included the annual program monitoring of the alcohol detoxification program of the corporation, which monitoring includes comparing program policies, procedures and client records to the Department's requirements contained in Chapter 10E-3, Florida Administrative Code, and certification under Rule 10E-3.60 for insurance payments. You also have worked with the corporation as the Department's contract manager, licensing representative, and program monitor for drug abuse services.

In your letter of inquiry and in a telephone conversation with our staff, you advised that you played no role in the procurement or the award of the community mental health and community alcohol services contract between the Department and the corporation, or for any of the other services provided by the corporation which you would oversee in the your new employment. You also advised that in your new position you would not have any responsibility for the drug program for which you currently are contract manager.

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

No agency employee who participates through decision, approval, disapproval, recommendation, preparation of any part of a purchase request, influencing the content of any specification or procurement standard, rendering of advice, investigation, auditing, or in any other advisory capacity in the procurement of contractual services shall become or be, while an agency employee, the employee of a person contracting with the agency by whom the employee is employed. [Section 112.3185(2), Florida Statutes, (Supp. 1982).]

This provision prohibits an agency employee from being employed concurrently by a business entity which is under contract with the employee's agency, if he participated in any capacity in the procurement of those contractual services. As you would resign your position with the Department prior to beginning your new job with the corporation, this provision would not apply.

The Code of Ethics also provides:

No agency employee shall, after retirement or termination, have or hold any employment or contractual relationship with any business entity other than an agency in connection with any contract in which the agency employee participated personally and substantially through decision, approval, disapproval, recommendation, rendering of advice or investigation while an officer or employee. [Section 112.3185(3), Florida Statutes, (Supp. 1982).]

This provision restricts the employment which you may seek after leaving the Department by prohibiting you from being employed by a business entity in connection with a contract in which you participated personally and substantially through decision, approval, disapproval, recommendation, rendering of advice, or investigation. As you will not be employed in connection with the drug abuse service contract for which you are Contract Manager, this provision would not prohibit your employment.

We also find that this provision would not prohibit your employment as administrator of the corporation's alcohol detoxification program because, although you did monitor the program as an employee of the Department, you had no responsibility in the procurement or development of that contract. In our view, the prohibition of Section 112.3185(3) is directed to those persons who participated in the procurement or development of a contract through "decision, approval, disapproval, recommendation, rendering of advice or investigation." We limit the interpretation of this list of activities to the procurement process because the same language is used in Section 112.3185(2), which clearly pertains only to actions of an agency employee in the procurement of a contract. This interpretation is buttressed further by the Senate Staff Analysis and Economic Impact Statement for Senate Bill 387 (April 19, 1982), which states:

Retired or terminated agency employees would be prohibited from contracting with an agency in connection with any contracts that the former employee participated in developing.

The Code of Ethics further provides:

No agency employee shall, within 2 years of retirement or termination, have or hold any employment or contractual relationship with any business entity other than an agency in connection with any contract for contractual services which was within the agency employee's responsibility while an employee. [Section 112.3185(4), Florida Statutes, (Supp. 1982).]

This provision would prohibit your proposed employment if that employment is in connection with any contract for "contractual services" which was within your responsibility as an employee of the Department. We are of the view that the alcohol detoxification program (of the contract for community alcohol services) of the corporation was within your responsibility as an employee of the Department because of your responsibility for monitoring that program. The final question which must be addressed, then, is whether that contract for community alcohol services is a "contract for contractual services" within the meaning of this section.

Section 112.3185(1), Florida Statutes, (Supp. 1982), provides that the term "contractual services" is defined as set forth in 287.012(3), Florida Statutes, (Supp. 1982). In summary, the term "contractual service" is defined in Section 287.012(3) as the "rendering by a contractor of its time and effort rather than the furnishing of specific commodities," including the furnishing of social services, but excluding "health services involving examination, diagnosis, treatment, or prevention; or services provided to persons with mental or physical disabilities by not-for- profit corporations" which have obtained a federal tax exemption. Parenthetically, we note that this definition describes those situations in which a State agency is required to use a competitive bidding process for the award of a contract for services. The contract between the Department and the corporation for community alcohol services is part of a contract under which the corporation also provides community mental health services. In a telephone conversation with our staff, the Contract Administrator for the Department advised that the Mental Health Program Office of the Department interprets these services as exempt from the requirement of competitive bidding, based upon their coming within the exclusion from the definition of "contractual services" for health services and services to persons with mental or physical disabilities. After review of the pertinent contract, we agree with the Department's interpretation, which we note has been made by the agency with the greater expertise in health services and services to the mentally and physically disabled. For this reason, we find that the prohibition of Section 112.3185(4) also would not apply to the employment which you contemplate.

Accordingly, we find that the Code of Ethics for Public Officers and Employees does not prohibit you from being employed as Director of Centralized Services with a nonprofit corporation which is under contract with the Department of Health and Rehabilitative Services, in light of your responsibilities as an employee of the Department.