This Advisory Opinion concerns the following issue as formulated from facts and/or circumstances furnished by a requestor. The Commission approved this opinion on June 7, 1996, basing its approval solely on the facts and circumstances stated herein.
 

May a law firm that represents a county board of supervisors also serve as bond counsel for that same county board of supervisors?

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 entity's internal rules and regulations.

The pertinent conflict of interest laws to be considered here are:

Code Section 25-4-103(f)(i)(ii), (g)(i), (h), (k)(i)(ii) 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:

(i) Counties.

(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);

(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(3)(a) states:

 
"(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.
 

This firm requests an opinion on the question of whether a firm can serve as bond counsel for a governmental entity which it already represents. This firm represents a county board of supervisors on a continuing basis, and that board is considering issuing bonds to fund its portion of a joint project with a municipality located in that county. Although this is a joint project of the city and county, each entity will issue its own bonds.

Our question is whether a firm may serve as bond counsel to a governmental entity which it represents on a continuing basis.

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

Section 19-3-47, 1972 Mississippi Code Annotated, provides that a county board of supervisors "shall have the power to pay reasonable compensation to attorneys who may be employed by it in the matter of issuance of bonds and the drafting of orders and resolutions in connection therewith", and "may employ a firm of attorneys to represent it as its regular attorneys on the same terms, conditions and compensation as provided for employment of an attorney as its regular attorney".

The question is whether or not the county board of supervisors' employment of the same law firm as both its regular attorneys and as bond counsel is prohibited by the above cited Code Section 25-4-105(3)(a).

Code Section 25-4-105(3)(a) prohibits a law firm and its members that serve as the regular attorneys for the county board of supervisors from being a contractor, subcontractor and vendor with that same county board of supervisors. This prohibition arises because the law firm and its members as employees and/or agents of the county are public servants of the county as defined in the above cited Code
Section 25-4-103(p)(ii).

If the contract employing the law firm provides that its duties as the county's regular attorneys include serving as bond counsel and sets the compensation for such service, then the law firm and its members would not be violating Code Section 25-4-105(3)(a).

However, a law firm that a county employs as its regular attorneys may not contract later to serve as bond counsel on a particular bond issue as to do so would violate Code Section 25-4-105(3)(a). The law firm and its members are public servants of the county under the original employment contract and therefore are prohibited from contracting with the county to provide bond counsel services under a second contract.

Ronald E. Crowe
Executive Director