This Advisory Opinion concerns the following issue as formulated from facts and/or circumstances furnished by a requestor. The Commission approved this opinion on July 12, 1996, basing its approval solely on the facts and circumstances stated herein.

May an individual serve on a regional housing authority board while simultaneously being employed as the executive director of a non-profit corporation that has as its purpose the development of low cost housing for low- income families?

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), (1), (m), (o) 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);

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.

(o) 'Public funds' means money belonging to the government.

(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 254-105(1), (2), (3)(a) and (5) 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 a part of this opinion.

I would like an official opinion as to whether a conflict of interest would exist if I, as Executive Director of the county housing and human development corporation, am appointed to the Regional Housing Authority Board.

Besides the above, the requestor provided the Commission's staff the following additional information. The county housing and human development corporation is a non-profit corporation that has as its purpose the development of low cost housing for low-income families. The non-profit corporation operates in one county served by the regional housing authority. No contracts, including rent subsidies, Section 8 approvals or other direct or indirect funding, presently exist between the non-profit corporation and the regional housing authority.

The Commission formally adopts Advisory Opinions No. 92-202-E and No. 91-063-E in response to this request and by attachment incorporates them into this opinion.

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

The requestor's appointment to the regional housing authority board is not as such prohibited by the conflict of interest laws because he is the executive director of the county housing and human development corporation.

However, Constitutional Section 109 and Code Section 25-4-105(2), both cited above, would prohibit the regional housing authority board from authorizing a contract with the county housing and human development corporation should its executive director be appointed to the regional housing authority's board. The prohibition would continue during the executive director's term on the regional housing authority's board, and for one (1) year thereafter. All contracts and all direct or indirect funding, including rent subsidies and Section 8 approvals, would be prohibited.

In addition, Code Section 25-4-105(3)(a), cited above, would prohibit the requestor from having a material financial interest in the county housing and human development corporation should it become a contractor, subcontractor or vendor with the regional housing authority after his appointment and should it receive any public funds. This is because a non-profit corporation receiving public funds is a "business" under the conflict of interest law's definition set forth in the above cited Code Section 25-4-103(c).

Notwithstanding the above, the requestor is advised to remain keenly aware of the above cited Code Section 25-4-105(1) and (5).

The requestor may not use his official position as a member of the regional housing authority board to obtain a pecuniary benefit for himself or the non-profit corporation if it is a business with which he is associated as defined in the above cited Code Section 25-4-103(d). A board member's use of his or her official position in this manner is prohibited by Code Section 25-4-105(1).

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.

Code Section 25-4-105(5) prohibits a public servant from using or disclosing non-public information gained through his or her official position 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 a non-profit corporation.

The requestor is advised 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 member's board nonetheless results in a contract in which the board member has a prohibited interest.

Ronald E. Crowe Executive Director