| Date: | 04/23/1985 |
|---|---|
| Organization: | State Ethics Commission |
An attorney who works in a state agency may conduct her own real estate business subject to certain limitations. In particular, she may not take any action as a state employee with respect to any property or person with whom she does, or expects to do, business, nor may her business receive a commission from the purchase or sale of state property unless certain special conditions have been satisfied.
You are an employee of Department of Revenue (DOR). You presently are in the process of obtaining your real estate broker's license. Once you obtain the license, you plan to open a real estate office. The office would employ several salespersons on a commission basis who would show properties to prospective buyers or lessees. You personally would also be showing property during weekends and evening hours.
What limitations would G.L. c. 268A impose on you in connection with your real estate business?
You will be subject to the following limitations.
As a state employee you are subject to the provisions of G.L. c. 268A, the conflict of interest law. The sections of that law which are applicable to your question are §§ 4, 6, 7 and 23. Section 4 prohibits a state employee from being compensated by or acting as agent or attorney for anyone other than the commonwealth or a state agency in connection with any particular matter[1] in which the commonwealth or a state agency is a party or has a direct and substantial interest. Your real estate business would be someone other than the state. Thus, this section would prohibit you from acting as agent for your business or for one of your employees or clients before any state agency in relation to particular matters in which the state is a party or is directly and substantially interested. Such matters would include, for example, application to state agencies for permits or licenses for your business or for its employees.[2]
Section 6 provides in relevant part that a state employee may not officially participate[3] in any particular matter in which she or any business organization in which she is an officer, director or employee, has a financial interest. This section precludes you from taking any action in your DOR capacity in connection with any matter involving state taxes which you or your business owes, or property for which your business is acting as a broker. Should such a matter come before you, you must disclose the nature of the matter and the financial interest in it to the Ethics Commission and your appointing official. That official must then either:
Section 7 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. You would have such a financial interest in any purchase or sale of state property if you or your business received a commission. There is, however, an exemption to § 7 which is potentially available to you. Section 7(b) provides that the § 7 prohibition will not apply to:
. . . a state employee other than a member of the general court who is not
employed by the contracting agency or an agency which regulates the activities
of the contracting agency and who does not participate in or have official
responsibility for any of the activities of the contracting agency, if the contract
is made after public notice or where applicable, through competitive bidding,
and if the state employee files with the state ethics commission a statement
making full disclosure of his interest and the interests of his immediate family
in the contract...
Thus if the contract for purchase or sale is made after public notice or advertisement, and as long as DOR is not the purchasing or selling agency and the other statutory conditions are satisfied, your financial interest in the contract would not be prohibited.
Finally, § 23 contains general standards of conduct applicable to all state employees. In particular you should be aware of two of its provisions. First, a state employee may not use or attempt to use his official position to secure unwarranted privileges or exemptions for himself or others. This section would be implicated if you were to use information you obtained in your DOR position to secure business for yourself. See e.g. EC-COI-84-131. Second, a state employee may not by his conduct give reasonable basis for the impression that any person can improperly influence or unduly enjoy his favor in the performance of his official duties, or that he is unduly affected by the kinship, rank or position of any party or person. This section would prohibit you, for example, from having private business dealings with taxpayers or employees over whom you have some official authority. See e.g. EC-COI-83-156.
End Of Decision
