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 5, 1996, basing its approval solely on the facts and circumstances stated herein.

May an employee of a non-profit consortium that has contracted with a state agency to implement a state-wide computerized system independently contract with an international firm that is the parent company of a national firm that will be bidding on the state-wide computerized system contract when the employee also was the primary consultant for the non-profit consortium on the state-wide computerized system implementation contract?

    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:

Code Section 25-103(f)(i)(ii), (g)(v), (h), 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:

(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.

(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."

    Pertinent facts and circumstances provided by the requestor, absent identifying data, are set forth as follows and considered a part of this opinion. The additional documentation referenced in the requestor's letter is available for review, absent identifying data, in the Commission's office.

I am requesting your guidance in determining what actions we should take in order to best protect the State's interest in a procurement project for a State Agency (SA). This project will establish a contract for the implementation of a Statewide Computerized System (SCS) to be administered by SA. The SCS includes an Automated Identification System (AIS) module as one of the major components.

Several months ago, SA entered into a contract to obtain consulting services through a non-profit consortium (NPC) which is partially funded by a department of the United States government. A copy of that contract is attached for your perusal. NPC is a widely acclaimed resource for expertise in this field of automation at the state, national and international levels. A salaried employee of NPC earning more than $5,000.00 a year as a senior systems specialist was assigned by NPC as the primary person responsible for developing specifications for the request for proposals (RFP) for the Mississippi project. It has now been brought to our attention that NPC's employee may be offered an opportunity to provide technical consulting services in Europe to an international AIS vendor. NPC's employee will be performing these consulting duties as an individual and not under the sponsorship of NPC or under his employment duties with NPC. In fact, NPC's employee will be taking a leave of absence from NPC in order to offer his services to the international AIS vendor. NPC's employee's understanding of the nature of his contract with the international AIS vendor, if offered, would be to serve as an expert witness in a court case in England involving a dispute over a national AIS system implementation. His fees for his services would exceed $5,000.00. An American AIS firm is, according to NPC's employee, a wholly owned subsidiary of the international MS vendor. We know that the American MS firm is likely to bid on the SA SCS/MS project either as a prime contractor, or a sub-contractor. Hence arises the possible conflict of interest.

We have received requests from approximately eighty (80) different vendors for the RFP. These vendors have been logged on our RFP request tracking system and will be mailed the RFP when it is ready for release. We expect to mail the RFP to all requestors this month. As a part of the RFP process, we will be hosting a mandatory bidders' conference next month. Any vendor who wishes to submit a bid on the project will have to be in attendance. This requirement applies only to prime contractors. Sub-contractors do not have to be in attendance in order to be included in a prime contractor's proposal. In addition to the regular items of business which are typically handled at a meeting of this type, we intend to use the meeting as an opportunity to address any issues regarding any conflict of interest, including a notification to potential bidders that a bid including the American MS firm will be disqualified, if that should be your decision.

We respectfully request your opinion on the following questions:

1. Is NPC's employee a "public servant" as provided for in Section 25-4-103 (p) of the 1972 Mississippi Code Annotated, as amended?

2. If NPC's employee accepts a consulting engagement with the international MS vendor, would that create a potential conflict of interest or an appearance of impropriety if the American MS firm bids on the project either as a prime or a sub-contractor, or is the conflict or appearance of impropriety only created if they bid and are awarded the contract?

3. What circumstance would have to exist to create a conflict of interest or the appearance of impropriety?

4. What actions should be taken by the State or others in order to prevent a conflict of interest or the appearance of impropriety?

5. If the Commission finds that a conflict would exist if the American MS firm serves as a contractor on the project, would our agency be required to disqualify any bids which included the American AIS firm as a potential contractor, either prime or sub?

6. If the Commission finds that a conflict would exist if the American MS firm serves as a contractor on the project, would our agency be obligated to inform the international MS vendor and/or any other potential bidders that this conflict exists so they may make the appropriate business decision?

7. If the Commission finds that a conflict would exist if the American MS firm serves as a contractor on the project, could NPC's employee later be re assigned by NPC to the Mississippi project without creating a conflict of interest?

8. If your answer to question #7 above is in the affirmative, please state under what circumstances NPC's employee could be reassigned? (110w much time must pass before he could rejoin the SA project, and in what capacity could he rejoin?)

9. If a conflict exists, could a new analyst be assigned by NPC to the Mississippi project without creating a conflict of interest, or should all ties with NPC be terminated?

    I am attaching copies of the following documents which are pertinent to the situation:
a letter from NPC to SA informing SA of NPC's employee's job opportunity with the
international AIS vendor; a responsive letter from our agency to NPC; and a fax from
NPC to our agency.

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

    The first question in the requestor's letter asks whether or not the non-profit consortium's employee is a "public servant" within the meaning set forth in the above cited Code Section 25-4-103(p). This is the key question because the state conflict of interest laws only address the conduct of "public servants."

    Clearly, the non-profit consortium's employee is not a "public servant" under the definitions in Code Section 25-4-103(p)(i) and (p)(iii). Therefore, the definition set forth in Code Section 25-4-103(p)(ii) must be met for him to be classified as a "public servant."

    The non-profit consortium's employee must be an officer, director, commissioner, supervisor, chief, head, agent or employee of the state agency for Code Section 25-4-103(p)(ii) to apply. The only possible position of those addressed that he might be is an agent.

    The non-profit consortium and its employee were not given the authority to act for or in the place of the state agency. The contract only requires the non-profit consortium to develop the system model, to prepare the request for proposals and to assist with technical analysis of the bids. Therefore, the non-profit consortium's employee is not an agent of the state agency.

    Since the non-profit consortium's employee is not a "public servant" for purposes of the state's conflict of interest laws, the state conflict of interest laws do not apply to him and for that reason responses to your remaining questions are not and cannot be addressed by the Commission.
 
 
 
 

Ronald E. Crowe Executive Director