This Advisory Opinion concerns the following issue as formulated from facts and/or circumstances furnished by a requestor. The opinion is based solely on the facts and circumstances as stated below and was approved by the Commission on June 9, 1995.

May a state entity which has as a primary responsibility the approval of financing for projects that create jobs and provide investment in the state receive as an appointment to its board of directors an individual who is employed as the executive director of a county economic development commission when the state entity does on occasion finance projects in the county?

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 state governmental entity are not addressed by this opinion.

The pertinent conflict of interest laws to be considered here are:
Code Section 254-103(e), (g)(v), (h), (1), (m) and (1))(i)(ii)(iii) states:
"(e) 'Compensation' means money or thing of value received, or to be received, from any person for services rendered.
(g) 'Government' means the state and all political entities thereof, both collectively and separately, including but not limited to:

(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.
(1) '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.
(m) 'Person' means any individual, firm, business, corporation, association, partnership, union or other legal entity, and where appropriate a governmental entity.
(p) 'Public servant' means:

(i) Any elected or appointed official of the government;
(ii) Any officer, direct or indirect, 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
(iii) Any individual who receives a salary, per diem or expenses paid in whole or in part out of the funds authorized to be expended by the government."

Code Section 25-4-105(1), (3)(d) and (5) 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.
(3) No public servant shall:

(d) Perform any service for any compensation during his term of office or employment by which he attempts to influence a decision of the authority of the governmental entity of which he is a member.

(5) No person may intentionally use or disclose information gained in the course of or by reason of his official position or employment as a public servant in any way that could result in pecuniary benefit for himself, any relative, or any other person, if the information has not been communicated to the public or is not public information."
Pertinent facts and circumstances provided by the requestor, absent identifying data, are set forth as follows and considered part of this opinion.
The state entity is administered pursuant to certain Sections of the 1972 Mississippi Code Annotated. The state entity consists of a certain number of individual members from whom a Board of Directors is elected to conduct the affairs of the state entity. This Board meets monthly to consider projects seeking financing that includes bond issues, guaranty loans, etc.
We have recently received a proposed appointment to the Board of Directors that requires some clarification. An individual who serves as an Executive Director of a County Economic Development Commission is being considered for said position. His duties with the County include the recruitment of industry into the area, as well as working with existing industry on expansions. On occasions the Board considers projects in the County. However, the state entity does not have a contractual relationship with the County Economic Development Commission, nor does it contemplate or anticipate any such contractual relationship. Our question to you is as follows:
Does an individual employed as executive [director] of a County Economic Development Commission have an ethical conflict with serving on this Board?
We would appreciate a ruling that gives us guidance relative to the issue described above. Please call if other information is required.
     This opinion is based on the understanding that no contracts exist between the state entity and the county economic development commission. This opinion will no longer apply should at any time a contract be entered into between the state entity and the county economic development commission. Furthermore, the existence of such a contract may result in the appointee being in violation of the conflict of interest laws.
     Based solely on the facts and circumstances provided by the requestor, the Commission's opinion is that the appointment of the executive director of a county economic development commission to the state entity's board of directors is not in and of itself a violation of the conflict of interest laws.

     The appointee's position as executive director of the county economic development commission demands that he be successful in the development of industry in the county of which a large part of his success depends on available financing. Consequently, his continuing as executive director is directly related to his success in developing industry in the county which is often related to available financing.
     Therefore, the requestor is cautioned to advise the appointee to remain keenly aware of Code Section 25-4-105(1), (3)(d) and (5), cited above, when performing his duties on the state entity's board of directors and as executive director of a county economic development commission.
     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.

     In order to avoid using 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 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 detail discussions, made in person, by telephone or by any other means.

     Also in order 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.

     In regard to Code Section 25-4-l05(3)(d), the appointee must avoid any attempt to influence a decision of the board of directors or the entire membership of the state entity when such efforts are part of his duties as executive director of the county economic development district. His attempt to influence the decision of the governmental entity of which he is a member on behalf of or in the interest of the county economic development district as its compensated executive director is prohibited by Code Section 25-4-105(3)(d).

     Furthermore, the appointee may not intentionally use or disclose non-public information obtained through his or her official position with the state entity that could result in a pecuniary benefit to himself or any other person as prohibited by Code Section 25-4-105(5).

A "person" as defined in Code Section 25-4-103(m), cited above, when appropriate means a governmental entity such as the county economic development commission.
 
 
 

Ronald E. Crowe Executive Director