Public Education Letter
November 3, 2009
Dear Mr. Erbetta:
As you know, the State Ethics Commission's Enforcement Division has conducted a preliminary inquiry into whether you, as a Marblehead Community Charter Public School (the "School") Board of Trustees ("Board") member, violated §§ 6, 7, and 23 of G.L. c. 268A, the conflict of interest law, by performing private compensated work at the School on a project for which you were the Board liaison, and thereafter by voting on the contract of the head of school, who had authorized that work. Based on the staff's inquiry (discussed below), the Commission voted on April 17, 2009, to find that there is reasonable cause to believe that you violated the conflict of interest law.
For the reasons discussed below, however, the Commission has concluded that further proceedings in your case are not necessary. Instead, the Commission has determined that the public interest would be better served by bringing to your attention, and to the public's attention, the facts revealed by the preliminary inquiry, and by explaining the application of the law to the facts, with the expectation that this advice will ensure your understanding of and future compliance with these provisions of the conflict of interest law.
By agreeing to this public letter as a final resolution of this matter, you do not admit to the facts and law discussed below. The Commission and you have agreed that there will be no formal action against you in this matter and that you have chosen not to exercise your right to a hearing before the Commission.
I. The School Expansion Project
You were appointed to the Board in 2001 and served on the Board until October 2007. In late 2003, the Board made plans to expand the leased space used by the School by adding four classrooms and a gymnasium (the "Project") at a cost of approximately $500,000. Head of School Thomas Commeret hired a contractor to do the work, and the Board designated you to serve as the Board's liaison on the Project. As the liaison, you presented Project updates to the Board and you were involved in the budget meetings regarding the Project.
In 2003, Mr. Commeret hired you and your company, Management Design Associates, Inc. ("MDA"), to be the School's project manager on the Project. You and your company served in that capacity until approximately February 2006.
Although you told us in a statement made under oath that you believed that Board members knew of this project manager arrangement, several Board members stated that they were unaware that you were being compensated for this work until after the fact.
In your defense, you note that as a trustee you regularly filed disclosure statements with the State Department of Education as required by G.L. ch. 71, § 89.  (These disclosures are also filed with the Commission.) While none of the disclosures specifically mentions the Project, your disclosure filed in January of 2004 identified you as a School trustee and states that you had the following financial interest at the School: providing "const. mgmt. from time to time." Your April 2005 disclosure states "const. mgmt," while the August 2006 disclosure states "const. mgr." According to you, you believed that, as a School trustee, you and/or your company could do compensated work for the school as long as you completed the financial disclosure forms.
Records obtained from the School indicate that you received a total of $93,833 in payments from the School between November 2003 and February 2006. Because your invoices are lacking in detail, it is difficult to determine how much of the $93,833 was actually for project management work for the Project. It appears that, at a minimum, you charged the School $12,482 for work performed between November 2003 and February 2006 for what you termed "miscellaneous labor," which was not related to the Project. This "miscellaneous labor" included loam spreading, painting, chair set-up, and sweeping.
As a School trustee, you were a "special state employee" as that term is defined in G.L. c. 268A, § 1(o). EC-COI-97-3. As such, you are subject to the provisions of the conflict of interest law that apply to state employees, and, in particular for the purposes of this discussion, to §§ 6, 7 and 23(b)(3) of that statute.
In relevant part, § 6 prohibits any state employee from participating as a state employee in a particular matter in which to his knowledge he, or a business organization in which he is serving as officer, director, trustee, partner or employee has a financial interest.
The School's contract with the construction company was a particular matter. In addition, the decisions made by the Board regarding the Project were also particular matters. You participated as a state employee in those particular matters by acting as the Board's liaison regarding the contract by presenting updates to the Board and by being involved in the Project budget meetings. Where you were being compensated in your private capacity as the project manager for the Project, you had a financial interest in these matters. The Board could have decided at any time that it was dissatisfied with the progress of the Project, or with the performance of the project manager. In effect, you were substantially involved in the ongoing review of your own performance and continuation of work, even though your board was not aware of that fact. Therefore, there is reasonable cause to believe that you violated § 6 by participating as a trustee in matters concerning the Project in which you had a financial interest.
Section 7 of G.L. c. 268A prohibits a state employee from having a financial interest, directly or indirectly, in a contract made by a state agency, in which the commonwealth or a state agency is an interested party, of which interest he has knowledge or has reason to know.
As stated above, as a School trustee, you were a "special state employee." At the same time as you were a School trustee, you had a financial interest in the Project contract as you were paid for work you did as project manager regarding that contract. You also had a financial interest in the contractual arrangement with the School by which you provided more than $12,000 in non-Project related services to the School. Therefore, there is reasonable cause to believe that you violated § 7.
In 2004 and 2005, you filed disclosures under G.L. c. 71, § 89(v) stating that you were a School trustee and that you had a financial interest in providing construction management services to the School. The G.L. c. 71, § 89(v) disclosures you made as a School trustee were insufficient to meet the disclosure and exemption requirements of G.L. c. 268A for purposes of § 7. In addition, you did not file any disclosures concerning the more than $12,000 that you received from the School for doing routine maintenance work between November 2003 and February 2006, which are separate § 7 violations. Although you could have sought exemptions under § 7(e)  to perform this work, such exemptions would have required separate disclosures to and approvals by the Governor. In any event, you did not obtain any § 7(e) exemptions.
II. Vote on Head of School Contract
In or about March 2005, the Board voted, with you voting in favor, to renew Mr. Commeret's two-year contract (July 2005 - June 2007) as Head of School. You so participated without making any disclosure that Mr. Commeret had hired you as the project manager and that he had approved and was approving invoices from you for that work as well as approving payments to you for non-Project-related work. (In March 2005, you submitted invoices totaling $752, purportedly for work you performed on the Project.)
The School's 2005 decision to renew Mr. Commeret's contract as Head of School was a particular matter. You participated in that decision (voting in favor), despite the fact that you were at the time performing paid project management work for the School under an agreement negotiated and agreed to by Mr. Commeret and you were doing paid non-Project work approved by Mr. Commeret. Therefore, there is reasonable cause to believe that you violated § 6 by voting to retain Mr. Commeret in a position where it was reasonably foreseeable that he would be able to allow you to continue to receive compensation for work that he authorized you to perform. See EC-COI-93-17 (municipal counterpart to § 6 prohibits a teacher from participating in the proposed re-negotiation of the town manager's contract, because such re-negotiations will determine whether or not the manager continues to participate in the union negotiations, which in turn will affect the teacher's financial interests).
Section 23(b)(3) of G.L. c. 268A prohibits a public employee from, knowingly or with reason to know, acting in a manner which would cause a reasonable person, knowing all of the facts, to conclude that anyone can improperly influence or unduly enjoy that person's favor in the performance of his official duties, or that he is likely to act or fail to act as a result of kinship, rank, position or undue influence of any party or person. This subsection's purpose is to deal with appearances of impropriety, including actions that give rise to appearances that public officials have given people preferential treatment. This subsection further provides, in effect, that the appearance of impropriety can be avoided if the public employee discloses in writing to his appointing authority all of the relevant circumstances which would otherwise create the appearance of a conflict of interest. The appointing authority must retain that written disclosure as a public record.
There is also reasonable cause to believe that you violated § 23(b)(3) by voting to renew Mr. Commeret's contract, while at the same time Mr. Commeret was approving your invoices for work at the School, thereby giving the appearance that Mr. Commeret (who had hired you as the project manager, which was not disclosed to the Board) could improperly influence you or unduly enjoy your favor or that you were likely to act or fail to act as a result of undue influence of Mr. Commeret.
Based upon its review of this matter, the Commission has determined that your receipt of this public education letter should be sufficient to ensure your understanding of and future compliance with the conflict of interest law. Therefore, this matter is now closed.
Very truly yours,
Karen L. Nober
 General Laws, ch. 71, § 89(v) provides: "Notwithstanding the provisions of this section or any other general or special law to the contrary, for the purposes of chapter 268A: (i) a charter school shall be deemed to be a state agency; and (ii) the appointing official of a member of the board of trustees of a charter school shall be deemed to be the commissioner of education. Members of boards of trustees of charter schools operating under the provisions of this section shall file a disclosure annually with the state ethics commission, the department of education, and the city or town clerk wherein such charter school is located. The form of the disclosure shall be prescribed by the ethics commission and shall be signed under penalty of perjury. Such form shall be limited to a statement in which members of the board of trustees shall disclose any financial interest that they or a member of their immediate families, as defined in section 1 of said chapter 268A, have in any charter school located in the commonwealth or in any other state or with any person doing business with any charter school.
Each member of a board of trustees of a charter school shall file such disclosure for the preceding calendar year with the commission within 30 days after becoming a member of such board of trustees, on or before September 1 of each year thereafter that such person is a member of such board and on or before September 1 of the year after such person ceases to be a member of such board; provided, however, that no member of a board of trustees shall be required to file such disclosure for the year in which he ceases to be a member of such board if he served less than 30 days in such year."
 At the time in question, § 7 (e) stated that § 7 does not apply to a special state employee who files with the State Ethics Commission a statement making full disclosure of his interest and the interests of his immediate family in the contract, if the governor with the advice and consent of the executive council exempts him. [The statute has since been amended to remove the requirement of the consent of the executive council.]