Opinion  EC-COI-83-56

Date:	04/12/1983
Organization:	State Ethics Commission

A legislator whose spouse has a financial interest in a business may not vote on special legislation that would affect his spouse's financial interest. Additionally, his spouse, who is a full-time state employee, may not have a financial interest in a contract between her business and a state agency unless she complies with the conditions for an exemption under the conflict law.

Facts

You are a member of the General Court, and your wife is a full-time employee within state agency ABC. Your wife and cousin (who is not a state employee) are planning to form a partnership in a travel agency and would be interested in making travel arrangements for state employees. You state that you would not be an officer in the business or have any ownership interest or be involved in the control or management of the business.

Question(s)

1: What restrictions would G. L. c. 268A place on your legislative activities should your wife commence the travel business?

2: What restrictions would G. L. c. 268A place on your wife should she commence the travel business?

Answer

You and your wife will be subject to the restrictions set forth below.

Discussion

Restrictions On Your Activities

       As a member of the General Court, you are a state employee within the meaning of G. L. c. 268A, §1 (q), and therefore are subject to the restrictions of G. L. c. 268A. The two provisions most relevant to your situation are §§6 and 23. Section 6, in pertinent part, prohibits you from participating^1/ as a legislator in any particular matter^2/ in which either you or a member of your immediate family has a financial interest. To the extent that your wife would have a financial interest in pending legislation affecting the travel industry, the §6 prohibition on your participation turns on whether the legislation is general or special. Proposed laws which are temporary, which do not amend the General Laws, or which would apply to a particular individual or business are examples of special legislation. See, Sands, 2 Sutherland Statutory Construction §40.01 etseq. (4th ed., 1973);EC-COI-82-169.^3/ In the event that a piece of special legislation affecting your wife's financial interest were to come before you, you would be required to refrain from any participation in that matter and to file with the Commission a statement disclosing "the nature and circumstances of the particular matter, and make full disclosure of such financial interest…” G. L. c. 268A, §6. Section 23 establishes standards of conduct which apply to all public employees as well as to members of the General Court. Under §23, you may not use your official position to secure unwarranted privileges for yourself or others. You should be aware of this section whenever you discuss the availability of your wife's travel business to individuals or entities which appear before you in your legislative capacity.^4/

Restrictions On Your Wife's Activities

       As a full-time ABC employee, your wife is also a state employee within the meaning of G. L. c. 268A, §1(q). Under §7, she is prohibited from having a financial interest in a state contract unless she qualifies for a statutory exemption. The scope of the §7 prohibition would include all travel arrangements which she would make with state agencies as well as with state employees whose work-related travel expenses will be reimbursed by their state agencies, because her commissions would constitute a financial interest in contracts made by state agencies. The only relevant exemption from this prohibition is contained in §7(b), which was enacted as part of St.1982, c.612 and took effect on March 29, 1983. This exemption permits your wife to have a financial interest in a state contract provided that:

1. her financial interest would be in a contract with a state agency other than ABC or an agency regulated by ABC;
2. she does not participate in or have official responsibility as an ABC employee for any of the activities of the contracting agency;
3. her contract is made after public notice or where applicable, through competitive bidding;^5/ and
4. she files with the Commission a written financial disclosure of her interest in the contract.^6/

       Thus, your wife will not be able to offer her services as a travel agent to ABC or ABC employees as long as she works for that agency. Whether she may do so for other state agencies or employees will turn on whether the above four conditions are satisfied.

End of Decision

DATE AUTHORIZED: April 12, 1983

^1/For the purposes of G. L. c. 268A, "participate" is defined as participate in agency action or in a particular matter personally and substantially as a state employee, through approval, disapproval, decision, recommendation, the rendering of advice, investigation or otherwise. G. L. c. 268A, §1(j).

^2/For the purposes of G. L. c. 268A, "particular matter" is defined as any judicial or other proceeding, application, submission, request for a ruling or other determination, contract, claim, controversy, charge, accusation, arrest, decision, determination, finding, but excluding enactment of general legislation by the general court. . . G. L. c. 268A, §1(k). (Emphasis added)

^3/You may contact the Commission should you need assistance in ascertaining whether a particular bill is general or special legislation under §1(k).

^4/section 7 of G. L. c. 268A prohibits, in certain circumstances, members of the General Court from having a financial interest in a state contract. As long as you refrain from serving as an officer, partner or owner and are not involved in the control or management of your wife’s business, any financial interest she may have in a state contract will not be imputed to you for the purposes of §7.

^5/As noted in EC-COI-83-35, “[t]he term, ‘public notice’ is not defined in the conflict of interest law. As the agency authorized to enforce that law, the Ethics Commission possesses the authority to interpret it, as well. . . Any such interpretation of ‘public notice’ must take into account the pairing of the term in the statute with ‘competitive bidding’ and the stated purpose of the drafter that ‘the general public [have] equal access to the contract through notice. . .’ Generally, §7 is designed to eliminate the public impression that state employees have an ‘inside track’ to procure state jobs and contracts. Where applicable, the mechanics of the competitive bidding process are sufficient to meet that goal. Such competition is not appropriate in many personal service employment arrangements. Therefore, a process other than competitive bidding, but addressing the concerns satisfied by that mechanism, must be adopted." In your situation as well, such a process would be required. At a minimum the state agencies and employees with whom your wife deals must contact other travel agents in order to compare terms. Their ultimate selection of an agent, be it her or one of the others, must be based on which one offers the arrangement most advantageous to the Commonwealth. The agencies or employees involved should keep a record of such attempts.

^6/The additional conditions in §7 (b) with respect to contracts for personal services would not be applicable here.