This Advisory Opinion concerns the following issue as formulated from facts and/or circumstances furnished by a requestor. The Commission approved this opinion on March 5, 2004, basing its approval solely on the facts and circumstances stated herein.
 

May an attorney who is a partner in a law firm that represents a county board of supervisors sell land to individuals on which they intend to construct homes when the construction of the homes will be funded through a first-time home buyers program operated by a regional housing authority which receives funding from the county board of supervisors for the first-time home buyers program?

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(a), (f)(i)(ii), (g)(i)(v), (h), (i), (l), (n), (o) and (p)(i)(ii)(iii) states:
 

“(a) ‘Authority’ means any component unit of a governmental entity.

(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) ‘Government’ 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.

(i) ‘Income’ means money or thing of value received, or to be received, from any source derived, including but not limited to, any salary, wage, advance, payment, dividend, interest, rent, forgiveness of debt, fee, royalty, commission or any combination thereof.

(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.

(n) ‘Property’ means all real or personal property.

(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), (2), (3)(a) and (4)(b) 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.

(4) Notwithstanding the provisions of subsection (3) of this section, a public servant or his relative:

(b) May be a contractor or vendor with any authority of the governmental entity other than the authority of the governmental entity of which he is a member, officer, employee or agent or have a material financial interest in a business which he is a member, officer, employee or agent where such contract is let to the lowest and best bidder after competitive bidding and three (3) or more legitimate bids are received or where the goods, services or property involved are reasonably available from two (2) or fewer commercial sources, provided such transactions comply with the public purchases laws.”

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 an attorney who practices law in a City in Mississippi.  The firm in which I am a partner represents the Board of Supervisors of the County. The Board of Supervisors of the County provides funding to a Regional Housing Authority who in turn operates a series of housing programs for the county including a first time buyers program.  I also own a small tract of farm land.  Three individuals have contacted me wanting to purchase one acre lots from me such that they can construct homes on the lot.  We have agreed upon a price but during my discussions, they indicated that they were participating in the County first time home buyers program.  I am concerned about my position as being a partner in the law firm that represents the Board of Supervisors of the County coupled with the fact that the Board of Supervisors also provides funding to the Regional Housing Authority for the operation of the first time home buyers program.  In connection with this, I would request that you advise as to whether this would constitute a violation of the Mississippi Ethics laws.

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 member of a governmental board, such as a member of a county board of supervisors, from having an interest, direct or indirect, in any contract authorized by the board of which he is a member, during his term or for one year thereafter.¹  As the county’s board attorney, Constitutional Section 109 and Code Section 25-4-105(2) do not apply to the requestor. Therefore, the question of whether the requestor will have a direct or indirect interest in the individuals’ loan contracts with the regional housing authority by way of the county board of supervisors’ funding of the first-time home buyers program is not at issue here.

Sections 43-33-101 through 43-33-133, 1972 Mississippi Code Annotated (amended), the “Supplemental Housing Authorities Law,” provide that a housing authority is a public body corporate and politic and is given its independent powers once it has been established by its governmental entities.  Therefore, a housing authority must be considered a separate governmental authority from its establishing governmental entities, in this case, the establishing counties, based on the “Supplemental Housing Authorities Law.”

Code Section 25-4-105(3)(a), cited above, prohibits a public servant from being a contractor, subcontractor or vendor with the governmental entity of which he is a member, officer, employee or agent.  Therefore, Code Section 25-4-105(3)(a) will apply to this instance since the requestor is the county board of supervisors’ employee as its board attorney(s), and since the county is one of the counties establishing and funding the regional housing authority.

Based on the above, Code Section 25-4-105(3)(a) will prohibit the requestor from selling his property to the regional housing authority unless one of the exceptions in Code Section 25-4-105(4)(b) is applicable, as the regional housing authority and the county board of supervisors are authorities of the same governmental entity for purposes of the Ethics in Government laws.

Code Section 25-4-105(4)(b) will allow the requestor to sell property to the regional housing authority, as it is a separate authority from the county board of supervisors which employs the requestor, only if the property is sold through a competitive bidding process and the requestor’s bid is determined to be the lowest and best bid when three (3) or more legitimate bids are received or only where the property is reasonably available from only two (2) or fewer commercial sources.

Notwithstanding the above, the requestor may sell the property directly to the individuals who have been determined to qualify under the regional housing authority’s first-time home buyer  program without violating Code Section 25-4-105(3)(a). The reason being that: 1)   the selling of the property to the individuals does not result in the requestor being a contractor with the regional housing authority, as the regional housing authority is not a party to the sale contract between the requestor and the individuals; 2)  the requestor is not a subcontractor with the regional housing authority as the requestor is not contracting with the individuals for the performance of an act that they have contracted to perform with the regional housing authority,² and 3)  the Mississippi Supreme Court in Attorney General Mike Moore, ex rel., et al. v. Byars, 757 So. 2d  248, 249, found that a contract in the form of a loan between a city and another party did not result in the other party being a contractor with the city as that term is meant in Code Section 25-5-105(3)(a).

The requestor is cautioned to remain keenly aware of Code Section 25-4-105(1), cited above, in regard to the circumstance presented herein.

Code Section 25-4-105(1) prohibits a public servant, including a county board attorney, from using his official position to obtain a pecuniary benefit for himself other than his compensation provided by law.
 
The only way a public servant can be certain to avoid a violation of Code Section 25-4-105(1) is to totally and completely recuse himself from any matter where it can be inferred that he  has a pecuniary interest.

 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.

Therefore, the requestor and/or his law firm are advised to totally and completely recuse  themselves from the county board of supervisors’ deliberations and actions pertaining to the funding of the first-time home buyers program. Also, the requestor and his law firm should not be representing the regional housing authority  in matters related to the first-time home buyers program.

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.
 
The public policy mandate set forth in Code Section 25-4-101 is another reason why the requestor and/or his law firm should totally and completely recuse themselves from the county board of supervisors’ deliberations and actions pertaining to the funding of the first-time home buyers program and avoid representing the regional housing authority in matters related to the first-time home buyers program.
 

Scott Rankin
Executive Director
 

¹ The Mississippi Supreme Court, in Frazier v. State, 504 So. 2d 675 (1987), held that an order of a public official’s board that appropriates funds that directly or indirectly benefit the public official through a governmental contract is part of the contract authorization process.

² The term contractor is generally used in the strict sense of one who contracts to perform a service for another and not in the broad sense of one who is a party to a contract.  Attorney General Mike Moore, ex rel., et al. v. Byars, 757 So.2d 243 (Miss. 2000).
Subcontractor.  One who has entered into a contract, express or implied, for the performance of an act with the person who has already contracted for its performance.  Black’s Law Dictionary 1277 (5th ed. 1979).