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 11, 2003, basing its approval solely on the facts and circumstances stated herein.
 

May an alderman who voted to approve a zoning change for a subdivision project and to accept the subdivision under the city’s regulations be a subcontractor on the subdivision project when there are no government contracts or funding involved in the subdivision project?

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:

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 25-4-101 states:

“The legislature declares that elective and public office and employment is a public trust and any effort to realize personal gain through official conduct, other than as provided by law, or as a natural consequence of the employment or position, is a violation of that trust.  Therefore, public servants shall endeavor to pursue a course of conduct which will not raise suspicion among the public that they are likely to be engaged in acts that are in violation of this trust and which will not reflect unfavorably upon the state and local governments.”

Code Section 25-4-103(c), (d), (f)(i)(ii), (g)(ii), (h), (l), (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  nonprofit 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:

(ii) Municipalities.

(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.

 
(l) ‘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.

(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 25-4-105(1) and (2) 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.”

Pertinent facts and circumstances provided by the requestor, absent identifying data, are set forth as follows and considered a part of this opinion.
 

I am writing in regard to a situation involving myself as an alderman with the City and as a contractor.

 
Last year a non-profit organization approached the city with plans to build a subdivision.  Since the request, we’ve changed the zoning in that area to meet the criteria that was already there.  We also granted the non-profit permission to build the subdivision by confirming the zoning change approved by the zoning board and accepting the subdivision under the city’s existing regulations.

The contractor was awarded the bid this July and asked me if I were interested in doing any sub work since I am a minority contractor.  Please keep in mind that no government funds are being used through the City.  Your attention in this matter is appreciated.

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

Constitutional Section 109 and Code Section 25-4-105(2), both cited above, prohibit a city board member from having an interest, direct or indirect, in a governmental contract authorized by the member’s board during his term and for one year thereafter. [Emphasis added to bold text]

In Frazier v. State, 504 So. 2d 675, (Miss. 1987), the Mississippi Supreme Court set forth the four elements for applying the prohibition imposed by Constitutional Section 109.  The four elements are:
 

1. Is there a governmental contract with the state, county, municipality or district?

2. Does the public officer have an interest, direct or indirect, in the contract?

3. Is the contract authorized by a law passed or order made by a board or public body of which the public officer is a member?

4. Was the authorizing law or order passed during the public officer’s term or within one year after the expiration (or termination) of such term?

Clearly, the zoning and subdivision approval by the city board and the requestor being a subcontractor on the project would result in elements 2, 3 and 4 being met if there is a governmental contract existing related to the subdivision project.

However, relying solely on the requestor’s facts that there is no governmental contract in which the requestor could have an interest, then there is no Constitutional Section 109 or Code Section 25-4-105(2) prohibition to the requestor accepting the subcontractor job.

 
The requestor is advised that if there is a government contract such as a grant or agreement for funding of the subdivision project from a governmental entity other than the city, then the requestor’s acceptance of the subcontractor’s  job would violate Constitutional Section 109 and Code Section 25-4-105(2).  This violation arises from the obvious fact that the subdivision project’s government assistance was contingent upon the town’s approval of the zoning change or the subdivision meeting city regulations, and as such, the action of the town’s board of aldermen was a part of the contract authorization process of such other governmental entity’s grant and/or funding. [Emphasis added to bold text]

A zoning change, or similar action, by a governmental board is not an authorization of a government contract as anticipated by Constitutional Section 109 and Code Section 25-4-105(2).

Notwithstanding the above, the requestor’s vote in favor of the zoning and subdivision  action before the city board of aldermen does raise concerns under the prohibition imposed by the above cited Code Section 25-4-105(1).

Code Section 25-4-105(1) prohibits a public servant, including an alderman, from using his official position to obtain a pecuniary benefit for himself or a business with which he is associated.

Clearly, the city board’s actions to approve the zoning and subdivision ultimately will result in a pecuniary benefit to the requestor if he and/or his business accepts the subcontractor job.

Regarding Code Section 25-4-105(1), the sole question would be whether the requestor  used his official position to obtain a pecuniary benefit for himself or his business when he voted in favor of the zoning and subdivision action.  To “use his official position,” a public servant must have some belief or expectation that his or her activities or inactivities will lead to the pecuniary benefit.  However, it is not required that his activities or inactivities constitute a misuse of his official position to violate Code Section 25-4-105(1).  In this case, the requestor’s favorable vote on the zoning and subdivision approval is not enough, by itself, to result in a violation of Code Section 25-4-105(1), unless the requestor had a reasonable expectation of benefitting from his vote. There is no indication from the available facts that the requestor had such a reasonable expectation of benefitting in this instance.  According to the requestor’s facts, the city board’s action on the zoning and subdivision was last year and the contractor was just selected this month.  In short, the requestor’s facts reflect no reasonable expectation of the requestor benefitting from his vote, as at the time of his vote, the selection of the contractor and thereby the contractor’s offer of subcontractor work to the requestor were months apart.

 
The issue presented by the requestor also must be viewed as it relates to Code Section 25-4-101, set forth above. This code section sets the tone for the conflict of interest laws as the Legislature’s “Declaration of Public Policy.” This public policy can be summarized as any circumstance having the potential of creating suspicion among the public and reflecting unfavorably upon the state or local government should be closely reviewed by public servants with the intent to reduce or eliminate any suspicion on the part of the public which detracts from the public’s trust in state or local government.

In order to comply with the public policy mandate set forth in Code Section 25-4-101, the requestor must avoid any actions that would benefit the nonprofit organization building the subdivision that comes before the city should he accept the subcontractor job.  A recusal is the only way the requestor can avoid such actions.

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 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.
 
The requestor is advised that a recusal or an abstention will not prevent a violation of Constitutional Section 109 and Code Section 25-4-105(2).  Even without a 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.
 
 

Scott Rankin
Executive Director