| Date: | 05/29/1984 |
|---|---|
| Organization: | State Ethics Commission |
Members of a Grants Review Committee internally formed by the Administering Agency for Developmental Disabilities within the Executive Office of Administration and Finance to administer the federal Developmental Disabilities Program in Massachusetts are state employees for conflict of interest law purposes. The Commission provides general advice on the conflict of interest law to the members.
The Administering Agency for Developmental Disabilities (AADD) is an agency within the Executive Office of Administration and Finance. The AADD administers the Developmental Disabilities Program (the Program) in Massachusetts pursuant to 42 U.S.C. § 6063(b)(1)(B). The Program receives approximately $1.0 million federal funds which is distributed through a competitive process. Private non-profit organizations and public agencies submit proposals, and the AADD funds those proposals which meet their criteria and which are consistent with Program priorities. The establishment of Program priorities and the overall planning and evaluation of state efforts in connection with the Program are the functions of the Massachusetts Developmental Disabilities Council (MDCC) pursuant to 42 U.S.C. § 6067.[1]
In the past, all grant applications have been reviewed solely by AADD staff. This year, in an effort to incorporate outside views in the funding process, the AADD has proposed the establishment of a Grants Review Committee (GRC). The membership would be drawn from AADD's internal staff, knowledgeable state agency personnel, experts in the field, consumers, and MDDC members. The GRC's function would be to review grant proposals and make recommendations to the AADD as to which are appropriate for funding. In their review of proposals, they would use the same evaluation criteria which the AADD staff would use in making the final decision. The GRC's recommendations would not be binding on the AADD although they would be given consideration. Assuming the GRC performed as planned, it would be made a permanent part of the funding process. GRC members would receive no compensation for their services, nor would they be reimbursed for their expenses.
1. Would members of the GRC be considered state employees within the meaning of G.L. c. 268A?
2. If so, how would G.L. c. 268A apply to GRC members?
1. Yes.
2. GRC members are subject to the limitations set forth below.
General Laws chapter 268A defines a state employee as:
A person performing services for or holding an office, position, employment or membership in a state agency, whether serving with or without compensation, on a full, regular, part-time intermittent or consultant basis . . . G.L. c. 268A, § 1(q) (emphasis added).
Prior opinions of the Commission have identified several criteria useful to an analysis of what constitutes "performing services for... a state agency." Among those criteria are
In a given fact pattern some of these criteria may be given more or less weight. Each factual situation must also be viewed in light of the purpose of the conflict of interest statute. Keeping these precedents in mind the Commission concludes that members of the GRC would be performing services for a state agency within the meaning of G. L. c. 268A.
First, there is the impetus for the creation of the GRC. There is no statutory or regulatory requirement that a body like the GRC be created. 42 U.S.C. § 6063 requires only that the administration of the Program be done by whatever body a state chooses to designate as its administering agency. In Massachusetts that agency is the AADD. It appears to be given wide discretion in terms of how the Program money is disposed of both substantively and procedurally. The only real limitation is that the programs or entities the AADD chooses to fund must have goals which are consistent with the plans and priorities of the MDDC. Even though there is no requirement for a GRC, the GRC would be a part of a function that is statutorily mandated. In this way it can be distinguished from the informal, ad hoc task forces whose status previously has been considered by the Commission.[2] In each of these previous opinions the task force or group in question was not providing its services in connection with any statutorily required function. In each case the subjects of its expertise were very general, e.g., general advice on the overall operation of a state agency (EC-COI-83-12), or discussions about the range of legal issues in various areas within a secretariat's jurisdiction (EC-COI-79-12).
The second criterion utilized by the Commission deals with the degree of formality associated with the job, its procedures, and its anticipated work product. The GRC would be utilizing evaluation criteria established by the AADD for its review of funding proposals. The existence of such substantive guidelines is a trait the GRC would share with those entities the Commission has found to be performing services for a state agency. See EC-COI-84-55; 83-74. Compare EC-COI-82-81. Although the final work product is a recommendation on a funding decision that is not binding on the AADD, such a work product is much more specific than, for example, commenting on proposed legislation or regulations (EC-COI-80-49) or expressing viewpoints on general topics in a purely advisory way (EC-COI-81-4; 79-12). Additionally, it is anticipated that the GRC would become a permanent part of the funding decision process. This suggests a much greater degree of formality than that found in the previously cited Commission decisions where the fact that the entity in question's role would be of limited duration was critical to the Commission's finding that its members were not state employees. See EC-COI-83-3; 79-12.
A third criterion is whether or not the entity is performing some essentially governmental function. In the case of the GRC it is clear from a reading of 42 U.S.C. § 6063 that decisions regarding the awarding of grants are to be the function of the state administering agency. Indeed, up until this year the funding decisions have been handled exclusively by AADD staff. Thus, in spite of the fact that the majority of GRC members would be drawn from outside the AADD, the GRC would be performing a governmental function. This is not to say that including outside viewpoints in that function may not only be appropriate but also desirable. That decision is left to the discretion of the AADD.
The last criterion is the extent of control or supervision exercised by government officials or agencies over the entity. The GRC would be required to function totally within the guidelines established by the AADD, which in turn fashions its guidelines to be consistent with the MDDC's plan and priorities. Both the AADD and the MDDC are state agencies within the meaning of G.L. c. 268A. Furthermore, the GRC presumably would have access to AADD staff and resources in performing its work. Given this high degree of control by the AADD and the MDDC, the GRC can be distinguished from those ad hoc, informal advisory groups whose agendas and work product are not so narrowly prescribed.
Because GRC members would not be compensated for their services, they would be considered special state employees as defined in G.L. c. 268A, § 1(o). The statute imposes fewer restrictions on the activities of special state employees. The proposed membership of the GRC would include state agency personnel, experts, consumers and MDDC members. The restrictions applicable to GRC members would be as follows.
Section 4 of the statute prohibits a special state employee from receiving compensation from or acting as agent or attorney for anyone other than the commonwealth or a state agency in relation to any particular matter[3] in which the commonwealth or a state agency is a party or has a direct and substantial interest and in which he has participated as a state employee, or which is pending in the state agency in which he is serving. Generally, this would prohibit a GRC member from being compensated by an outside entity in connection with that entity's application for Program funds. The member would also be prohibited from acting as agent for anyone in connection with a funding application.[4]
Section 6 of the statute prohibits a state employee from participating as an employee in a particular matter in which he or a business organization in which he serves as an officer, director or employee has a financial interest. Where the state employee's duties would require him to participate in the matter, the employee must advise his appointing authority and permit that person to decide whether the financial interest is substantial enough to require the employee to abstain from any participation in the matter. GRC members whose organizations have financial interests in AADD funding decisions would also be required to refrain from participating in discussions or votes on the funding applications of organizations or individuals who are in direct competition for the same funds. See EC-COI-83-78.
Section 7 of the statute prohibits a state employee from having a financial interest in a contract made by a state agency. Since this provision encompasses employment contracts, it is of particular significance to the members who are state agency personnel. As noted above, they, as members, are state employees. Accordingly, they would have a financial interest in their employment contract, i.e., their regular state job. However, since as members they are special state employees, they would qualify for an exemption contained in § 7(d) which permits them to serve as long as their work on the GRC does not require them to participate in or have official responsibility for any of the activities of the agency they are employed by, and they file an appropriate disclosure with the Commission.[5]
Section 23 of the statute contains general standards of conduct which are applicable to all state employees. It provides in part that no state employee shall;
Under these provisions GRC members who also have connections with entities seeking or receiving Program funding would have to avoid using their membership to secure unwarranted privileges (such as extensions of deadlines for submission of proposals) for the entities they are connected with. GRC members should also avoid participating as members in funding recommendations which would involve their organizations since to do otherwise would give reasonable basis for the impression that their connection with the organization could improperly influence their recommendations.[6]
