This Advisory Opinion concerns the following issue as formulated from facts and/or circumstances furnished by a requestor. The Commission approved this opinion on April 6, 2001, basing its approval solely on the facts and circumstances stated herein.

May a board of supervisors purchase a parcel of land from a former member of the county's economic development district when part of its stated use will be for economic development?

State law restricts the Mississippi Ethics Commission to interpreting and issuing opinions on Sections 25-4-101 through 25-4-119, 1972 Mississippi Code Annotated and Article IV, Section 109, Mississippi Constitution of 1890. Therefore, this opinion does not address the Mississippi laws outside the Commission's jurisdiction nor the governmental entity's internal rules and regulations.

The pertinent conflict of interest laws to be considered here are:

Constitutional Section 109 states:

"No public officer or member of the legislature shall be interested, directly or indirectly, in any contract with the state, or any district, county, city, or town thereof, authorized by any law passed or order made by any board of which he may be or may have been a member, during the term for which he shall have been chosen, or within one year after the expiration of such term."

Code Section 25-4-101 states:

"The legislature declares that elective and public office and employment is a public trust and any effort to realize personal gain through official conduct, other than as provided by law, or as a natural consequence of the employment or position, is a violation of that trust. Therefore, public servants shall endeavor to pursue a course of conduct which will not raise suspicion among the public that they are likely to be engaged in acts that are in violation of this trust and which will not reflect unfavorably upon the state and local governments."

Code Section 25-4-103(f)(i)(ii), (g)(i)(v), (h), (l), (n), (o) and (p)(i)(ii)(iii) states:

"(f) 'Contract' means:

(i) Any agreement to which the government is a party; or

(ii) Any agreement on behalf of the government which involves the payment of public funds.

(g) 'Governmental' means the state and all political entities thereof, both collectively and separately, including but not limited to:

(i) Counties; and

(v) Any department, agency, board, commission, institution, instrumentality, or legislative or administrative body of the state, counties or municipalities created by statute, ordinance or executive order including all units that expend public funds.

(h) 'Governmental entity' means the state, a county, a municipality or any other separate political subdivision authorized by law to exercise a part of the sovereign power of the state.

(l) 'Pecuniary benefit' means benefit in the form of money, property, commercial interests or anything else the primary significance of which is economic gain. Expenses associated with social occasions afforded public servants shall not be deemed a pecuniary benefit.

(n) 'Property' means all real or personal property.

(o) 'Public funds' means money belonging to the government.

(p) 'Public servant' means:

(i) Any elected or appointed official of the government;

(ii) Any officer, director, commissioner, supervisor, chief, head, agent or employee of the government or any agency thereof, or of any public entity created by or under the laws of the State of Mississippi or created by an agency or governmental entity thereof, any of which is funded by public funds or which expends, authorizes or recommends the use of public funds; or

(iii) Any individual who receives a salary, per diem or expenses paid in whole or in part out of funds authorized to be expended by the government."

Code Section 25-4-105(1) and (2) states:

"(1) No public servant shall use his official position to obtain pecuniary benefit for himself other than that compensation provided for by law, or to obtain pecuniary benefit for any relative or any business with which he is associated.

(2) No public servant shall be interested, directly or indirectly, during the term for which he shall have been chosen, or within one (1) year after the expiration of such term, in any contract with the state, or any district, county, city or town thereof, authorized by any law passed or order made by any board of which he may be or may have been a member."

Pertinent facts and circumstances provided by the requestor, absent identifying data, are set forth as follows and considered a part of this opinion.

On behalf of our client, we respectfully request your advisory opinion pertaining to his service as a former member of the Board of Directors of the County Economic Development District. The pertinent facts are as follows:

This individual is a former member of the Board of Directors of the County Economic District, having been so appointed by the Board of Supervisors of County, Mississippi. (This individual resigned on March 29, 2001.) The County Board of Supervisors is interested in purchasing certain real property along the U. S. Highway in the County owned by this individual. The purpose of purchasing the land is for the County to provide sites for industrial development and have access to gravel located thereon. The land will be purchased in the name of the County, and the purchase will be approved by the County Board of Supervisors. The County Economic Development District has taken no action with respect to the purchase. Further, the County Economic Development District has never recommended the purchase of land for industrial development or any other purpose to the County Board of Supervisors. After the land is purchased by the County, the County Economic Development District will have a role in developing the property for industrial sites. It is expected that the land will be sold to the County for an amount equal to or less than its present market value. The County Board of Supervisors will follow all statutes and regulations applicable to the purchase of real property by a county in Mississippi.

ISSUE: May this individual, a former member of the Board of Directors of County Economic Development District, sell real property owned by this individual to the County which will then use the property to acquire gravel and for industrial sites?

We would respectfully request your consideration of this issue and response in the form of an advisory opinion.

Should you need further information, please do not hesitate to contact us.

Based solely on the facts and circumstances presented by the requestor, the Commission's opinion is as follows.

Constitutional Section 109 and Code Section 25-4-105(2), both cited above, prohibit a member of a county economic development district from having an interest, direct or indirect, in a contract authorized by the county economic development district during the member's term or within one year thereafter. [Emphasis added to bold text]

Section 19-5-99, 1972 Mississippi Code Annotated (amended), provides that a board of supervisors has the option of providing for the management of a county economic development district by appointing trustees to manage the affairs of the district and that the funds made available by the county for the support and maintenance of the district may be expended by a majority of the trustees appointed to manage the district. Furthermore, Code Section 19-5-99(3)(a) provides that the economic development district established by the board of supervisors shall have the authority to acquire by gift, purchase or otherwise, and to own, maintain, control and develop real estate for the use and operation of industrial parks and other industrial development. In addition, Code Section 19-5-99(4) provides that before the board of supervisors may issue bonds for economic development the county economic development district must adopt a resolution requesting the bond issue.

Code Section 19-5-99 seems to clearly confer the power to purchase real estate to be used for economic development to the board of trustees of the county economic development district and to confer the power to fund economic development to the board of supervisors.

Therefore, Constitutional Section 109 and Code Section 25-4-105(2) will prohibit the former trustee of the county economic development district from selling the land in question to the county as state law gives the power to purchase the land to the county economic development district. This prohibition will apply for one year from the date of the former member's resignation from the county economic development district.

Even if the board of supervisors had the authority to purchase land for economic development after having established a county economic development district managed by a board of trustees, Constitutional Section 109 and Code Section 25-4-105(2) would be violated should the board of supervisors purchase land from a former trustee within the one year of his resignation if the purchase was with bond funds. The violation would occur because the use of bond funds to purchase the land requires a resolution by the board of trustees of the county economic development district thereby making the board of trustees part of the contract authorization process for purposes of Constitutional Section 109 and Code Section 25-4-105(2).

It is not necessary to address the question of whether the board of supervisors could purchase the former trustee's land for its gravel as the combined purpose of economic development is sufficient to prohibit the purchase.

An advisory opinion is not the proper process to determine whether a violation of the above cited Code Section 25-4-105(1) has already occurred. A thorough review and examination of the existing facts would be necessary to make such a determination.

However, if the former trustee as a board member recommended and advocated the purchase of his land to the board of trustees of the county economic development district or the board of supervisors, then it is this Commission's opinion that a violation of Code Section 25-4-105(1) would occur should the board of trustees authorize the purchase of his land and the board of supervisor's authorized the funding for the purchase of his land. The purchase price of the land would be a pecuniary benefit accruing to the former trustee.

Code Section 25-4-105(1) prohibits a public servant, including a trustee of a county economic development district, from using his official position to obtain a pecuniary benefit for himself, such as the sale of land.

In order to avoid a violation of Code Section 25-4-105(1), a public servant must totally and completely recuse himself from the subject matter providing the pecuniary interests. An abstention is a vote with the majority of the governing entity's board and therefore does not qualify as a recusal.

A total and complete recusal requires that the public servant not only avoid debating, discussing or taking action on the subject matter during the official meeting, but also avoid discussing the subject matter with other board members, staff or any other person prior to and after the official meeting. This includes casual comments, as well as detailed discussions, made in person, by telephone or by any other means.

Also to properly recuse oneself from a matter, the public servant must leave the room or area where such discussions, considerations and/or actions take place. The minutes of the governing entity's board should state the public servant left the meeting by showing him or her absent for that matter.

The requestor is cautioned to advise the former trustee that a recusal or an abstention will not prevent a violation of Constitutional Section 109 and Code Section 25-4-105(2). Even without a board member's vote, the authorization by the member's board nonetheless results in a contract in which the board member has a prohibited interest.

The issue presented by the requestor also must be viewed as it relates to Code Section 25-4-101, set forth above. This code section sets the tone for the conflict of interest laws as the Legislature's "Declaration of Public Policy." This public policy can be summarized as any circumstance having the potential of creating suspicion among the public and reflecting unfavorably upon the state or local government should be closely reviewed by public servants with the intent to reduce or eliminate any suspicion on the part of the public which detracts from the public's trust in state or local government.

Clearly, the circumstance presented herein is one that can be expected to create suspicion among the public and reflect unfavorably upon the board of supervisors and the board of trustees of the county economic development district. Therefore, the board of supervisors and/or the board of trustees of the county economic development district should avoid purchasing the former trustee's land in order to fully and completely comply with the public policy mandate set forth in Code Section 25-4-101.
 

Ronald E. Crowe

Executive Director