| Date: | 01/30/1984 |
|---|---|
| Organization: | State Ethics Commission |
The conflict of interest law permits an individual to work for a state agency while that agency leases property from that employee's adult children.
- This page, EC-COI-84-11, is offered by
- State Ethics Commission
Opinion
Opinion EC-COI-84-11
Table of Contents
Facts
You are presently a part-time employee with a state agency (ABC). Your husband is a property developer. In his role as a trustee, he arranged for ABC to lease two parcels of land beneficially owned in trust by your three adult children. The leases were competitively bid and involve the rehabilitation of buildings for ABC office space. One parcel is owned by your children through an irrevocable trust, and the other parcel is owned seventy percent by your children and thirty percent by another unrelated party.
In your position with ABC, you do not monitor the leases. You also had no role in any aspect of the agency's decision-making process regarding these leases. You are neither a party to nor derive benefit from either trust, nor do you support any of your children.
Question
Does the conflict of interest law, G. L. c. 268A, allow you to work for ABC while the agency leases property from your children?
Answer
Yes.
Discussion
As an employee of ABC, you are a state employee as defined in G. L. c. 268A, §1 (q), and §7 of the law applies to you. Under this section, a state employee is prohibited from having a direct or indirect financial interest in a contract made by a state agency. The leases which your husband arranged with ABC are contracts made by a state agency. See EC-COI-81-92. Your husband, as a trustee receiving a commission for arranging the leases, has a financial interest in the ABC contracts. However, as a general rule, §7 does not automatically attribute a spouse's financial interest in a state contract to the state employee. see EC-COI-80-105; 80-60. Inasmuch as you do not share the control or management of your husband's business, his financial interest in the ABC contracts will not be attributed to you. See EC-COI-82-128.
In a prior opinion, EC-COI-81-92, the Commission advised another state employee in a similar situation that the leasing of a building to a state agency violated §7 because the beneficiaries of the trust were minor children whom the employee had a duty to support. Thus, to the extent that the children derived financial benefit from the lease, the individual's duty of support was commensurately lessened, thereby giving the individual an indirect financial interest in the lease. However, since you have no interests in the trusts and have no financial obligations to your adult children which could be affected by their income from the trusts, you will derive no direct or indirect financial benefit from these leases. This conclusion is consistent with a prior Commission advisory opinion, EC-COI-80-121, where no §7 violation was found under circumstances nearly identical to your situation. See, also, Attorney General Conflict Opinion No. 854.
End of Decision
DATE AUTHORIZED: January 30, 1984