1. May a school district purchase auto supplies from an auto parts store after an employee of the auto parts store is sworn in as a school board member if the purchases are through a term bid it accepted prior to the auto parts store's employee being elected to the school district's board of trustees?
2. May a board member-elect take office when his spouse was a former teacher for the school district and whose resignation was less than one year prior to the beginning date of the term of the board member-elect?The Mississippi Ethics Commission is restricted 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, Mississippi laws outside the jurisdiction of the Commission and internal rules and regulations of the governmental entity are not addressed by this opinion.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 25-4-103(c), (d), (f)(i)(ii), (g)(iii), (h), (k)(i)(ii) and (p)(i)(ii)(iii) states:
"(c) 'Business' means any corporation, partnership, sole proprietorship, firm, enterprise, franchise, association, organization, holding company, self-employed individual, joint stock company, receivership, trust or other legal entity or undertaking organized for economic gain, a non-profit corporation or other such entity, association or organization receiving public funds.(d) 'Business with which he is associated' means any business or which a public servant or his relative is an officer, director, owner, partner, employee or is a holder of more than ten percent (10%) of the fair market value or from which he or his relative derives more than One Thousand Dollars ($1,000.00) in annual income or over which such public servant or his relative exercises control.
(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:
(iii) All school districts.
(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.
(k) 'Material financial interest' means a personal and pecuniary interest, direct or indirect, accruing to a public servant or spouse, either individually or in combination with each other. Notwithstanding the foregoing, the following shall not be deemed to be a material financial interest with respect to a business with which a public servant may be associated:
(i) Ownership of any interest of less than ten percent (10%) in a business where the aggregate annual net income to the public servant therefrom is less than One Thousand Dollars ($1,000.00);
(ii) Ownership of any interest of less than two percent (2%) in a business where the aggregate annual net income to the public servant therefrom is less than Five Thousand Dollars ($5,000.00).
(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(2) and (3)(a) states:
"(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.
(3) No public servant shall:
(a) Be a contractor, subcontractor or vendor with the governmental entity of which he is a member, officer, employee or agent, other than in his contract of employment, or have a material financial interest in any business which is a contractor, subcontractor or vendor with the governmental entity of which he is a member, officer, employee or agent."Pertinent facts and circumstances provided by the requestor, absent identifying data, are set forth as follows and considered part of this opinion.
Pending the results of an election run-off for school board trustee two scenarios exist involving possible conflicts of interest. Please consider these situations and advise me at your earliest convenience.
1) Our district has a term bid with a local auto supply store for transportation parts and supplies. This bid was awarded on June 12, 1995, to run for the term of one year from July 1, 1995, through June 30, 1996. On November 7, 1995, an employee of this company was elected to the Board and will begin serving on January 1, 1996. Can we continue to purchase under this bid from the company after the employee takes office in January?
2) In May, 1995, a particular teacher did not seek to have her contract renewed. Since one year has not lapsed since her resignation, can her husband serve as a Board member effective January 1, 1996?Based solely on the facts and circumstances presented by the requestor, the Commission's opinion is as follows.Issue 1. Code Section 25-4-105(3)(a), cited above, prohibits a public servant from having a "material financial interest" in a business which is a contractor, subcontractor or vendor with the public servant's governmental entity.
Therefore, the school district's purchasing of auto supplies from the auto parts store once the board member-elect is sworn into office will result in a violation of Code Section 25-4-105(3)(a).
Furthermore, Constitutional Section 109 and Code Section 254-105(2), cited above, prohibit a board member from having a direct or indirect interest in a contract authorized by the board of which he or she is a member during his or her term or for one year thereafter.
Therefore, each approval of an auto parts store claim by the school board for purchases by the school district after the board member-elect is sworn into office will result in an authorization of a contract in violation of the Constitutional Section 109 and Code Section 25-4-105(2).
The requestor is cautioned to advise the board member-elect that a recusal or an abstention will not prevent a violation of Constitutional Section 109 or Code Section 25-4-105(2) and (3)(a). Even without the board member's vote, the authorization by the board of trustees nonetheless results in a contract in which the board member has a prohibited interest.
Issue 2. The one year trailer found in Constitutional Section 109 and Code Section 25-4- 105(2), cited above, applies to one (1) year after the expiration of a board member's term.
Therefore, the fact that the spouse's contract expired within one (1) year of the beginning of the board member-elect's term results in the prohibitions found in Constitutional Section 109 and Code Section 25-4-105(2) not being applicable to this specific situation.
Ronald E. Crowe Executive Director