Letter Ruling  Public Education Letter in the Matter of William Kingkade

Date:	09/30/2021
Organization:	David A. Wilson, Executive Director
Referenced Sources:	G.L. c. 268A, the Conflict of Interest Law, as Amended by c. 194, Acts of 2011

Public Education Letter

Dear Mr. Kingkade:

As you know, the State Ethics Commission conducted a preliminary inquiry into whether you, in your capacity as a member of the Milford Select Board, violated the state conflict of interest law by: (1) participating in matters related to the sale of town-owned property for use by the Greater Milford Social Club, of which you are a founding member; and (2) voting to appoint personal friends to Town positions. You cooperated fully with the inquiry.

On July 29, 2021, the Commission voted to find reasonable cause to believe that your actions, as described below, violated sections 19 and 23(b)(3) of the conflict of interest law, General Laws chapter 268A, and authorized adjudicatory proceedings. The Commission further determined, however, that, in lieu of adjudicatory proceedings, the public interest would be better served by publicly discussing the facts revealed by the preliminary inquiry and explaining the application of the law to those facts in this Public Education Letter. By resolving this matter through this Public Education Letter, the Commission seeks to ensure that you and public employees in circumstances similar to those described below will have a clearer understanding of the conflict of interest law and how to comply with it.

The Commission and you have agreed that this matter will be resolved publicly with this educational letter and that there will be no formal proceedings against you. You have chosen not to exercise your right to a hearing before the Commission.  

Violations Relating to Sale of Town-Owned Land

The Facts

You were a member of Milford’s Select Board from April 2015 through April 2021.  

On February 26, 2019, the Milford Club, LLC (“the Milford Club”) was incorporated in Massachusetts. According to its certificate of organization, the Milford Club’s primary activities are the buying and selling of real estate. Christopher Morin is one of the Milford Club’s three part-owners. You have been personal friends with Morin for many years and were best man at his wedding.

On March 14, 2019, the Greater Milford Social Club (“the Social Club”) was incorporated in Massachusetts. According to its certificate of organization, the Social Club’s primary activities are “to operate, manage, and maintain a private member club,” and to “make, sell, deal with and in food products… and alcoholic and non-alcoholic beverages.” The Social Club also engages in community activities and fundraising for local charities. Neither the Milford Club nor the Social Club were incorporated as not-for-profit corporations.

You are one of twelve founding members of the Social Club. According to the Social Club’s Operating Agreement, signed on March 14, 2019, the twelve founding members formed an LLC under which the members’ capital contributions consisted of a one-time initiation fee and membership fees, and their liability is limited to their initial capital contributions. The Operating Agreement also provides that net profits and losses are to be allocated in proportion to the founding members’ capital contributions. On its seasonal liquor license application dated July 19, 2019, the Social Club’s twelve founding members, including you, are listed as having a direct or indirect financial interest in the Social Club.  

On April 5, 2019, the Milford Club purchased the former Foggiano Club property at 28 Granite Street, Milford (“the Club Property”), to be the site of the Social Club. During the purchase process, the Milford Club learned from its lender that a structure on the Club Property encroached upon a 0.073 acre parcel of town-owned land at Granite and Railroad Streets (“the Town Parcel”). The lender required the Milford Club to solve the encroachment issue in order to finalize its purchase of the Club Property, by either purchasing the Town Parcel from the town, or seeking a variance from the town, or removing the encroaching structure (a small storage room).

One of the Milford Club owners described the Club Property encroachment situation to Town Counsel. After a survey of town departments reflected no municipal need for the Town Parcel, Town Counsel determined that the Select Board could authorize the sale of the Town Parcel.

On April 8, 2019, the Town Treasurer appeared before the Select Board to recommend that the Town Parcel be declared as surplus property and offered by sale at a public auction. You made a motion to declare the Town Parcel as surplus. The Select Board unanimously voted in favor of your motion. You participated in the vote on your motion.

You then asked whether the Town Parcel could be sold by direct disposition rather than at a public auction. You stated, “I was there today, and this was of interest to me. Since there’s two abutters, but one already is on the land, do we have to go to auction rather than ask them to purchase it?” Town Counsel replied that a direct disposition was lawful.[1] You then moved to offer the Town Parcel for sale by direct disposition to the abutters. The Select Board unanimously voted in favor of your motion. You participated in the vote on your motion.

At no time did you publicly disclose that you were a founding member of the Social Club with an interest in the club, that the Milford Club was required by its lending bank to solve the encroachment upon the Town Parcel in order to complete its purchase of Club Property, that the Milford Club was purchasing the Club Property to be the site of the Social Club, or that you had a close personal friendship with one of the Milford Club’s co-founders.  

The Conflict of Interest Law

Section 19

Section 19 of the conflict of interest law prohibits a municipal employee from participating as a municipal 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. Section 19 encompasses any reasonably foreseeable financial interest, whether positive or negative, large or small.

The Select Board decisions to declare the Town Parcel as surplus and to offer it by sale by direct disposition to the abutters were “particular matters” under § 19.[2]

The Social Club had a financial interest in the decisions concerning the Town Parcel because the Milford Club, which purchased the Club Property for use by the Social Club, sought to purchase the Town Parcel to resolve its lender’s concern about the Club Property’s encroachment on the Town Parcel.

The Social Club is a business organization for purposes of the conflict of interest law. Although it participates in charitable endeavors, it is primarily a private social club engaged in the selling of food and drinks. It is not incorporated as a not-for-profit corporation. Even it if it were, however, it would still be considered a business organization under the conflict of interest law.[3] As a founding member of the Social Club, and pursuant to its Operating Agreement, you were a partner in the Social Club.

Accordingly, you were prohibited by § 19 from participating as a Select Board member in the Board’s decisions to declare the Town Parcel as surplus and offer it for sale by direct disposition to the abutters. Nonetheless, you participated in the decisions by moving to declare the Town Parcel as surplus, asking whether the town could offer the Town Parcel by direct disposition to the abutters rather than at a public auction, moving to offer the Town Parcel for sale by direct disposition, and voting in favor of both motions.  Therefore, the Commission found reasonable cause to believe you violated § 19 of the conflict of interest law.

Section 23(b)(3)

Section 23(b)(3) of the conflict of interest law prohibits a municipal employee from acting in a manner which would cause a reasonable person, having knowledge of the relevant circumstances, to conclude that he can be improperly influenced in the performance of his official duties, or that he is likely to act or fail to act as a result of kinship or undue influence of any party or person. Even if a public official is not improperly influenced or does not act with bias, he is still in violation of this section if he gives the appearance of bias, as even an appearance of acting on behalf of private interests, rather than the public interest, harms the confidence in government and the government’s ability to act. 

By participating in matters related to the sale of the Town Parcel as described above, the Commission found that a reasonable person could believe that you were improperly influenced in your Select Board duties by your association with the Social Club and/or your close personal relationship with Milford Club part-owner Morin. Therefore, the Commission found reasonable cause to believe you violated § 23(b)(3) of the conflict of interest law.

 

Violation Relating to Appointment of Friends to Town Positions

The Facts

On June 20, 2016, the Select Board was presented with three candidates for local building inspector. You moved to appointed Matthew Marcotte to the position. The Select Board unanimously voted to appoint Marcotte to the position. You participated in the vote. In October 2017, the Select Board unanimously voted to appoint Marcotte as Building Commissioner. You participated in the vote.

On July 30, 2018, the Select Board was presented with nine candidates for Labor Counsel. You moved to appoint Patrick Holland. The Select Board unanimously voted to appoint Holland. You participated in the vote.

You testified that in 2016, Marcotte was an “acquaintance” with whom you were “friendly” and knew his family members. When asked how you moved to appoint Marcotte of the three candidates, you testified that he had asked you for your support, that you knew his family, and that you knew he was qualified. You described Holland as a friend. At no time did you file a written public disclosure regarding your relationships with Marcotte or Holland.

The Conflict of Interest Law

Section 23(b)(3)

By moving to appoint, and voting in favor of appointing, Marcotte, whose family you knew and who had asked you for your support, and Holland, who you considered a friend, to town positions, the Commission found that a reasonable person could believe that you could be improperly influenced in your Select Board duties by your relationships with Marcotte and/or his family and Holland. Therefore, the Commission found reasonable cause to believe you violated § 23(b)(3).

Disposition

Based upon its review of this matter, the Commission has determined that the public interest would be best served by the issuance of this Public Education Letter and that your receipt of this letter should be sufficient to ensure your understanding of and future compliance with the conflict of interest law.

This matter is now closed

[1] Just prior to its discussion of the Town Parcel, the Select Board had voted to declare certain town-owned property on Bowdoin Drive as surplus and offer it for sale at a public auction. You then moved that the Select Board reconsider its vote as to the Bowdoin Drive property and offer it for sale by direct disposition to the direct abutters, rather than at a public auction. The Select Board unanimously voted in favor of your motion.

[2] “Particular matter” includes any contract, claim, controversy, decision or determination. G.L. c. 268A, §1(k).

[3] See EC-COI-07-2. The definition of “business organization” includes non-profit organizations that substantially engage in business activities, such as selling goods and services in exchange for fees. Relevant factors include: 1) whether the organization’s activities include commerce, trade, or other common business activities; 2) whether the activities are engaged in for the organization’s support or profit; 3) whether the activities are regularly engaged in; and 4) whether the activities are a significant rather than de minimis part of the organization’s activities.