This Advisory Opinion concerns the following issues 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 January 5, 1996.

Issue 1. May the Home Corporation, a body politic of the state, loan funds to a for-profit partnership to construct a multi-family housing facility in a municipality when the for-profit partnership's general partner is a corporation whose sole owner is a county supervisor for the county in which the municipality is located?

Issue 2. May the Home Corporation, a body politic of the state, loan funds to a county supervisor to construct a multi-family housing facility in a municipality which is located in the county the supervisor serves?

    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 entities 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)(i)(v), (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 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:

(i) Counties; and

(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.

(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

(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)(g) 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:

(g) May contract with the Mississippi Veteran's Home Purchase Board, Mississippi Housing Finance Corporation, or any other state loan program, for the purpose of securing a loan; however, public servants shall not receive favored treatment.

(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 in the form of the requestor's letter dated December 28, 1995, absent identifying data, are attached hereto and considered part of this opinion.

    The requestor is advised that this opinion will no longer be in effect should the facts and circumstances change or in any way be contrary to those presented in the attached letter.

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

    Issue 1. It would not as such be a violation of the conflict of interest laws for the county supervisor to be the sole owner of a corporation that is the general partner in a limited partnership which is receiving funding from the Home Corporation to construct a multi-family housing facility in a municipality located within the county that the supervisor serves.

    Issue 2. It would not as such be a violation of the conflict of interest laws for the county supervisor to individually receive funding from the Home Corporation to construct a multi-family housing facility in a municipality located within the county that the supervisor serves.

    Notwithstanding the above, the requestor should advise the county supervisor to be keenly aware of the following situations.

    If the county supervisor was a member of the Home Corporation, the loan to the partnership would result in the county supervisor being in violation of the above cited Constitutional Section 109 and Code Section 25-4-105(2). Also, should the county that the supervisor serves authorize any contracts or agreements concerning the construction or funding of the multi-family housing facility, the county supervisor would be in violation of Constitutional Section 109 and Code Section 25-4-105(2) and (3)(a).

    Should the county supervisor proceed with this loan and construction, he also will be prohibited by Constitutional Section 109 and Code Section 25-4-105(2) from having any interests in any future contracts authorized by his county. Therefore, there can be no contracts in the future authorized by county, such as an interlocal cooperation agreement with the municipality, that would promote, enable or enhance the economic viability of the multi-family housing facility in which he has an interest.

    The requestor is cautioned to advise the county supervisor 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.

    Furthermore, the county supervisor could be in violation of Code Section 25-4-105(1) and (3)(d), cited above, should the county supervisor, either individually or through the county, use his official position to cause any action that sanctions or supports the construction of the multi-family housing facility in which he has an interest.

    In addition, the county supervisor's use of any non-public information obtained through his public position of county supervisor that could result in a pecuniary benefit for the county supervisor, the corporation or the partnership would cause the county supervisor to be in violation of the above cited Code Section 25-4-105(5).
 
 
 
 

Ronald E. Crowe Executive Director