| Date: | 01/31/1985 |
|---|---|
| Organization: | State Ethics Commission |
The president of a small consulting firm which provides management consultation for DMH is a state employee for the purposes of G.L. c. 268A because DMH has specifically contemplated that he will be performing those services. As a special state employee, he may not have a financial interest in other state contracts unless he qualifies for a §7 exemption.
You are the president of a consulting firm, ABC. The firm consists of you and your partner. Your area of expertise is within the mental health field. At the present time ABC has a contract with the Department of Mental Health (DMH) to provide consultation. You signed the contract as president of ABC and you are personally performing the services called for in the contract on a part-time basis.
1. Are you a state employee as that term is defined in G.L. c. 268A?
2. What limitations does G.L. c. 268A place on you with respect to your ability to enter into additional contracts with DMH or with other state agencies?
1. Yes.
2. You are subject to the following limitations.
G.L. c. 268A, the conflict of interest law, broadly defines a state employee as:
a person performing services for or holding an office position, employment, or membership
in a state agency, whether by election, appointment, contract of hire or engagement,
whether serving with or without compensation, on a full, regular, part-time, intermittent or
consultant basis, including members of the general court and executive council.
This definition is generally not interpreted to include an employee of a corporation or vendor which contracts with the state. See e.g. EC-COI-84-49; 84-5; 83-94.[1] However, both the Commission and the Attorney General have held that such an employee is covered by the definition if the terms of the contract indicate that a specific individual's services are being contracted for. See, e.g. EC-COI-83-165; Attorney General Conflict Opinion No. 852. That is the case here. Although ABC is the party with whom DMH has formally contracted, you signed that contract and you have stated that you are the person who will actually be performing the services. Additionally, given the fact that ABC is a small entity and that the services being provided to DMH are precisely those services within your area of expertise, the Commission concludes that DMH specifically contemplated using your services. Therefore you are a state employee for purposes of G.L. c. 268A.
Because you are a state employee during the term of your contract with DMH, there are limitations on your ability to enter into other contracts funded by state agencies. Section 7 of G.L. c. 268A provides in relevant part that a state employee may not have 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." However, because you work only part-time for DMH you are considered a special state employee.[2] Section 7 applies less restrictively to special state employees. Section 7(d) provides that the prohibition on contracting does not apply to a special state employee who does not participate in or have official responsibility for any of the activities of the contracting agency and who files with the State Ethics Commission a statement making full disclosure of his interest..'. in the contract." Thus, while § 7(d) would prohibit you from having additional contracts with DMH during the term of your present contract, it does not prohibit you from entering into contractual arrangements with other state agencies. Section 7(e) provides that the prohibition on contracting does not apply "to a special state employee who files with the State Ethics Commission a statement making full disclosure of his interest...in the contract, if the governor with the advice and consent of the executive council exempts him." You may therefore have more than one contract with DMH only if you obtain the necessary waiver from the governor and executive council.
End Of Decision
