May 3, 2002
This Advisory Opinion concerns the following issue as formulated from facts and/or circumstances furnished by a requestor. The Commission approved this opinion on May 3, 2002, basing its approval solely on the facts and circumstances stated herein.
May an alderman be a paid consultant to another city that buys excess natural gas from the alderman’s city?
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)(ii), (h), (l) 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:
(ii) Municipalities.
(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.
(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.
Our firm represents a City A as City Attorneys. The City A is a code charter municipality.A question with unique facts has been raised involving application the conflict of interest laws as they may relate to an Alderman.
One of the City A’s Aldermen also serves as a part-time paid consultant to the utility department of City B another municipality in the county.There is local and private legislation which authorizes a written Agreement between both City A and City B, for the sale of excess natural gas by City A to City B for resale by the other City B to its customers.City A is the seller, but this arrangement is mutually advantageous to both City A and City B.City A and City B renew this agreement on a year-to-year basis.
The Alderman in question is knowledgeable in natural gas matters, and serves as a part-time, independent consultant to City B regarding natural gas sales and distribution, at a compensation of approximately $3,000.00 per year.This consulting arrangement is not a part of the local and private legislation and was separately arranged between the Alderman and City B at City B’s request.
City B is not a vendor of City A, rather, City A is the vendor of gas to City B.Nonetheless, out of caution, the Alderman would like an advisory opinion on application of the ethics laws to this fact situation.As per your normal procedure, we would ask that names and localities not be published as part of any opinion.
The Commission formally adopts Advisory Opinion No. 99-008-E in response to this request and by attachment incorporates it into this opinion.
Based solely on the facts and circumstances presented by the requestor, the Commission’s opinion is as follows.
It is not as such a violation of the conflict of interest laws for an alderman to simultaneously serve as a consultant for another city.The finding is based on the two cities being separate governmental entities as defined in the above cited Code Section 25-4-103(g)(h).
As set forth in the attached advisory opinion, a circumstance can exist that would cause a violation of Constitutional Section 109 and Code Section 25-4-105(2), both cited above, should a board member of one governmental entity contract with a separate governmental entity.
Such a circumstance involves the existence of contracts between the two governmental entities in which the public servant would have an inherent interest and/or would receive a personal or pecuniary benefit.
Constitutional Section 109 and Code Section 25-4-105(2) would prohibit an alderman from directly or indirectly having an inherent interest and/or receiving a personal or pecuniary benefit from his city employer as a result of any contracts existing between the two governmental entities.
However, the facts presented by the requestor show that the public monies involved are flowing from the city to whom the alderman is a consultant to the city where he is an alderman, and therefore, his actions on the board of aldermen would not provide an inherent interest or a personal or pecuniary benefit to the alderman as a consultant. For this reason, it does not appear that the fees charged the city to whom the alderman is a consultant, by the city he serves as a board member, for excess natural gas, would be a circumstance thatwould cause a violation of Constitutional Section 109 and Code Section 25-4-105(2).
Even though the current circumstance appears not to violate Constitutional Section 109 and Code Section 25-4-105(2) due to the flow of the funds, there is a situation that could result in the current circumstance being one in which the alderman in question violates Constitutional Section 109 and Code Section 25-4-105(2).That circumstance is where his contract to provide consulting services to the city purchasing the natural gas is contingent upon that city obtaining or retaining its agreement with the city he serves as an alderman to receive the surplus natural gas, and the cities’ agreement being authorized by the alderman’s board during his term or within one year thereafter.
The requestor is cautioned to advise the alderman 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.
In addition to the above laws, an alderman choosing to contract with a city doing business with the city where he is an alderman must remain keenly aware of the above cited Code Section 25-4-105(1) and Code Section 25-4-101.
Code Section 25-4-105(1) prohibits public servants from using their official positions to obtain a pecuniary benefit for themselves, a relative or a business with which they are associated.
To avoidusing their official positions to obtain a pecuniary benefit, the public servants must totally and completely recuse themselves from subject matters providing the pecuniary interests.An abstention is a vote with the majority of the governmental 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 governmental entity’s board should state the public servant left the meeting by showing him or her absent for that matter.
Therefore, the alderman is advised that the only way he can be certain to avoid violating Code Section 25-4-105(1) is to recuse himself from all matters coming before the board of aldermen that concern the city with which he contracts as a consultant.This is especially true in regard to the excess natural gas contract.
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, an alderman’s direct or indirect involvement with matters concerning acity with which he contracts, that are before the board of aldermen of which he is a member, has the potential of creating suspicion among the public and reflecting unfavorably upon the city.Therefore, this is another significant reason why the alderman should totally and completely recuse himself from any matter concerning the city with which he contracts.
In summary, the alderman should totally and completely recuse himself from all matters before the city’s governing authority concerning the city’s agreement with the city with whom he contracts to avoid violating Code Section 25-4-105(1) and to comply with the state public policy set forth in Code Section 25-4-101.
The requestor is reminded to advise the alderman that violations of Constitutional Section 109 and Code Section 25-4-105(2) are not avoided by a recusal.
Scott Rankin
Executive Director