a. award contracts or grants to any organization or company that has an employee, officer or owner that is a formal member of the state commission?b. advocate legislation which would benefit, directly or indirectly, any organization or company that has an employee, officer or owner that is a formal member of the state commission?2. Are members of standing committees under the state commission subject to the state conflict of interest laws if these members are not provided for in the enabling legislation and also are not members of the state commission?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 entities' 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 25-4-103(a), (c), (d), (f)(i)(ii), (g)(v), (h), (k)(i)(ii), (1), (m) and (p)(i)(ii)(iii) states:
"(a) 'Authority' means any component unit of a governmental entity.(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 finds.(d) 'Business with which he is associated' means any business of 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:(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 finds.(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);(I) '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, 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), (2), (3)(a)(d), (4)(b)(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.(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.(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.(4) Notwithstanding the provisions of subsection (3) of this section, a public servant or his relative:(b) May be a contractor or vendor with any authority of the governmental entity other than the authority of the governmental entity of which he is a member, officer, employee or agent or have a material financial interest in a business which he is a member, officer, employee or agent where such contract is let to the lowest and best bidder after competitive bidding and three (3) or more legitimate bids are received or where the goods or services involved are reasonably available from two (2) or fewer commercial sources, provided such transactions comply with the public purchases laws.(d) May be a contractor, subcontractor or vendor with any authority of the governmental entity of which he is a member, officer, employee or agent or have a material financial interest in a business which is a contractor, subcontractor or vendor with any authority of the governmental entity of which he is a member, officer, employee or agent: (i) where such goods or services involved are reasonably available from two (2) or fewer commercial sources, provided such transactions comply with the public purchases laws; or (ii) where the contractual relationship involves the further research, development, testing, promotion or merchandising of an intellectual property created by the public servant.(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 a part of this opinion.I enjoyed very much meeting with you to discuss the issues that I presented to you, and following these conversations I would like to formally petition your Commission to address the issues pertaining to the relationship of the state commission and some of its members from the private sector.Specifically, I would appreciate it if you would respond to the following issues:a. Will either of the following situations create a conflict of interest for the state commission members or the state commission as a whole as defined by Mississippi Law?1. The award of contracts or grants by the state commission to any organization or company that has an employee/owner/executive who is a formal member of the state commission.2. The advocacy of legislation by the state commission which would benefit, directly or indirectly, any organization or company that has an employee/owner/executive who is a formal member of the state commission.b. The state commission has several standing committees, including one created at the direction of the Governor. Some of the members of the standing committees are neither named in the enabling legislation nor one of the six formally appointed members authorized by the legislation. Are these committee members covered by the conflict of interest laws of the State in the same manner as the state commission members themselves?Based solely on the facts and circumstances presented by the requestor, the Commission's opinion is as follows.Issue la. The state commission's awarding of contracts or grants to any organization or company that has an employee, officer or owner as a formal member of the state commission would be prohibited by the above cited Constitutional Section 109 and Code Section 25-4-105(2) and (3)(a). Constitutional Section 109 and Code Section 25-4-105(2) also prohibit the state commission from awarding contracts or grants to any organization or company that had an employee, officer or owner as a former member of the state commission for one (1) year after the former member's term ended.
The requestor is cautioned to advise the board member that a recusal or an abstention will not prevent a violation of Constitutional Section 109 or Code Section 25-4-105(2). Even without the 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.
Issue lb. The formal members of the state commission are not as such prohibited by the conflict of interest laws from advocating legislation that would equally affect, both theoretically and practically, everyone within the members' industry.
Notwithstanding the above, the formal members of the state commission must remain keenly aware of the above cited Code Section 25-4-105(1), (3)(d) and (5).
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 detailed 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.
Therefore should the particular legislation that the state commission members are advocating be expected to result in a pecuniary benefit to a particular member's organization or company, then that member would need to recuse himself or herself from that matter.
Code Section 25-4-105(3)(d) prohibits a public servant from being compensated during his or her term of office or public employment for attempting to influence a decision of the authority of the governmental entity of which he or she is a member.
Therefore, Code Section 25-4-105(3)(d) would prohibit formal members of the state commission from being paid by their organization or company to attempt to influence the state commission to advocate a particular piece of legislation.
Code Section 25-4-105(5) prohibits a public servant from using or disclosing non-public information gained through his or her official position or public employment that could result in a pecuniary benefit to the public servant, any relative or any other person. A person within the definition set forth in Code Section 25-4-103(m), cited above, can be an organization or company.
Issue 2. It is the Commission's understanding that the standing committees that are the subject of this issue are not authorized by state law, but instead are set up by the state commission, except for one which was set up by the Governor, to provide advisory assistance. The committees are made up of individuals that have specific and beneficial knowledge about the industries on which the state commission advises the Governor and Legislature. They have no legal standing and service is strictly voluntary. In other words, the committee members have no authority other than to advise the state commission upon its request and are not compensated in any way from public funds nor do they expend, authorize or recommend the use of public funds.
The Commission finds that the members of the standing committees are not public servants under the definition set forth in Code Section 25-4-105(p), and therefore are not covered by the conflict of interest laws.
Ronald E. Crowe Executive Director