September 11, 1991

FACTS:

Page 357

You are presently a Selectman in the Town of Northbridge. In
the FY1991 and FY1992 budgets, the Town Meeting approved a line
item providing no compensation for Selectmen. The Selectmen had
recommended this line item to assist in alleviating a budget crisis
in Town. Although uncompensated, several of the Selectmen continued
to receive health benefits through the Town's group insurance
policy under a 1977 Town By-law which provided that compensated and
uncompensated employees were eligible for health insurance if their
respective boards met certain criteria, such as frequency of
meetings.

Recently, the Northbridge Finance Committee has requested that
uncompensated employees be removed from the group health insurance
policy pursuant to G.L. c. 32B, the statutory contributory group
insurance scheme for county and municipal employees. G.L. c. 32B
defines an employee as a person in the service of any political
subdivision of the Commonwealth and who receives compensation for
such service. G.L. c. 32B, s.2. The definition includes elected and
appointed officials. Northbridge Town Counsel has confirmed that
c. 32B is applicable to the Town and that the Selectmen must
receive compensation in order to be eligible for health benefits.
It is estimated that the municipality's contribution to each health
insurance premium is approximately $5,000 per year.

At the time that the Selectmen relinquished their salaries,
they were not aware that they would be ineligible for the group
insurance coverage. At one of the Selectmen's meetings, a former
Selectman offered to donate $5.00 for the purpose of creating a
$1.00 salary for each Selectman so that the Selectmen would remain
eligible for group insurance.


QUESTION:


Does G.L. c. 268A permit the Selectmen to accept the $5.00
donation?


ANSWER:


No.


DISCUSSION:



Selectmen, as municipal officials, are subject to G.L. c.
268A, s.23(b)(2), which prohibits a municipal official from using
or attempting to use his position to secure for himself or others
unwarranted privileges or exemptions which are of substantial value
and which are not properly available to similarly situated
individuals. At issue is whether the Selectmen, by accepting the
donation, are securing an unwarranted privilege of substantial
value that is not available to other similarly situated
individuals.

In past precedent, the State Ethics Commission and the
Massachusetts courts have considered a benefit to be of substantial
value if it is worth $50 or more. See Commonwealth v. Famigletti,
4 Mass. App. Ct. 584 (1976); {Commission Advisory No. 2};
EC-COI-85-42. In its cases, "the Commission has recognized that 'substantial
value' is a standard to be dealt with by judicial interpretation
in relation to the facts of the particular case and is more
desirable than the imposition of a fixed valuation formula." In
the Matter of William A. Burke, Jr.,
1985 SEC 248, 251. Among the
factors the Ethics Commission will weigh in a determination of
whether an item is of substantial value are: the cumulative
value of multiple gratuities, any facts which would enhance the face
value, and the prospective worth and utility value of a benefit.
See EC-COI-88-22 (cumulative value of car rental discounts exceeds
$50); 83-70 (unpaid faculty appointment of substantial value); In
the Matter of William A. Burke, Jr.,
1985 SEC 248 (access to
hospital's CEO is of substantial value).

Under the circumstances you present, the Ethics Commission
concludes that the intended benefit conferred on the Selectmen is
not $1.00 salary, but rather, the eligibility for health benefits.
This conclusion is based on the fact that the proffered donation
is only a token salary and the real underlying purpose of the
donation is to allow the Selectmen to continue health benefits.
These health benefits are of substantial value.

Further, the Ethics Commission concludes that acceptance of
this donation would constitute an unwarranted privilege. Under G.L.
c. 41, s.108, it is the responsibility of the town to set the
salary and compensation of all elected officers and to revise any
salary at a town meeting. See Amerige v. Saugus, 208 Mass. 51
(1911) (town, not selectmen, set compensation rates). At the Town
Meetings, the Northbridge residents voted not to compensate their
Board of Selectmen. Under these circumstances, a donation from a
private party, which is used to obtain personal compensation and
benefits that were not appropriated by a town meeting vote as
required by law, constitutes an unwarranted privilege for purposes
of G.L. c. 268A, s.23(b)(2). Acceptance of this donation is also
unwarranted as it is being offered for the personal use of the
Selectmen solely because of their status as Selectmen and is not
available to other similarly situated individuals, such as all
other uncompensated Town personnel. See EC-COI-87-7; 86-17; 86-14.

The Ethics Commission is aware that G.L. c. 44, s.53A permits
selectmen to accept gifts on behalf of a municipality,[2] but we
do not find that the statute is applicable where the Selectmen are
approving a gift for their personal benefit. The Ethics Commission
has suggested that c. 44, s.53A may be used as a vehicle by which
a private party may pay expenses for public officials without
violating G.L. c. 268A. See e.g., Public Enforcement Letters 90-1;
90-2; 90-5
. But, implicit in the Commission's suggestion, are the
facts that donations under c. 44, s.53A would be used to further

Page 358

municipal purposes and that the Town's governing body would review
the appropriateness of the gift.[3] For example, the Commission
suggested that c. 44, s.53A may apply to vendor payment of travel
expenses for fire chiefs to inspect fire trucks because the travel
may serve a legitimate public purpose as fire trucks are
manufactured to meet the needs of a specific municipality and the
c. 44 procedures would allow scrutiny of the reasonableness of the
expenses by other municipal officials. Public Enforcement Letter
90-2. See also, Public Enforcement Letter 90-1
(public interest in
travel to inspect curriculum); Public Enforcement Letter 90-5 (may
be public purpose in accepting travel packages permitting the
Director of Haverhill Council on Aging to make decisions regarding
packages offered to the elderly).

Under the facts that you present, we do not find that the
donation to the Board of Selectmen will be used to further
municipal purposes. Rather, the donation will be used for the
personal benefit of the individual selectmen to obtain health
benefits. Compare EC-COI-89-23 (s.s.3 and 23 not violated by
donation of computer for benefit of agency, not particular
employee); 84-114 (s.s.3 and 23 not violated by donation of artwork
for permanent exhibition in government agency and not for personal
use of any employee) with EC-COI-87-7 (payment of trip expenses not
connected with any municipal duties violates s.23); 86-14 (private
automobile purchase discount violates s.23); 85-23 (private stock
purchase violates s.23). Accordingly, G.L. c. 268A, s.23(b)(2) will
prohibit the Northbridge Selectmen from accepting a token salary
from a private party in order to continue health insurance benefits
under a municipal group policy.[4]

---------------

[1] You state that the former Selectman made his offer because
he believed that the Selectmen's loss of health benefits was unfair
where the Selectmen relinquished compensation in order to assist
the Town and where past practice permitted uncompensated employees
to receive health insurance benefits. This former Selectman does
not have any official dealings with the Board of Selectmen.

[2] G.L. c. 44, s.53A provides, in pertinent part, that an
officer or department of a town may accept grants or gif] from
funds from the federal government or from a charitable foundation,
a private corporation, an individual or the Commonwealth and may
expend the funds for the purposes of the grant or gift with the
approval of the Board of Selectmen without further appropriation.

[3] We note that c. 44, s.53A is titled " An Act Providing that
Officers and Departments of Cities, Towns and Districts May Accept
Grants or Gifts For Municipal Purposes and May Expend the Same
Without Appropriation.
" (emphasis added). According to legislative
history this legislation was recommended in order to permit
municipalities to accept all types of federal grants and to enable
all municipal departments to accept grants and gifts for municipal
purposes. Among the examples cited in the committee report were
grants for public assistance or education. 1964 House No. 83

[4] We note that your facts also present issues under G.L. c.
268A, s.3. Section 3(b) prohibits a public official from accepting
an item of substantial value for or because of any official act
performed or to be performed by such employee. This section would
be violated if the donor of the gift had official dealings before
the Board of Selectmen. Because we find that s.23(b)(2) prohibits
acceptance of the $5.00 donation, we need not decide, at this time,
whether s.3 is violated when a gift is offered solely because of
a public official's status as public official, without any further
nexus between the donor and the donee.

End Of Decision