Opinion  EC-COI-85-63

Date:	08/13/1985
Organization:	State Ethics Commission

A full-time state employee may, while on leave of absence from his position, enter into a lease agreement with a state agency.

 

Facts

You are currently a full-time employee of state agency ABC. You are considering entering into a lease arrangement for space in a state office building for the purpose of running a cafe restaurant open to the general public. Your brother, who is not a state employee, would be your business partner in this venture. Once a lease arrangement is entered into you will either resign your position or take a leave of absence.

Question

What limitations does G.L. c. 268A place on your having a contract with another state agency?

Answer

You are subject to the restrictions discussed below.

Discussion

As a full-time employee of ABC you are considered a "state employee" for the purposes of G.L.. c. 268A, § 1(q). According to § 7 of G.L. c. 268A, a state employee is prohibited 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." The lease you would have with the state would be considered a contract. Therefore, in order to enter into this contract you would have to either take a leave of absence or become a part-time employee.

1. Leave of Absence

The Commission has held in previous opinions that a state employee on leave of absence who is not receiving compensation, fringe benefits or retirement credit would not be subject to the prohibitions of G.L. c. 268A, § 7. See EC-COI-84-17.^[1] During the period of a leave of absence, you would not, strictly speaking, hold employment with ABC if you suspended your right to receive benefits attributable to that position. Therefore, during your leave of absence, your financial interest in the lease with the Division of Capital Planning and Operations (DCPO) is not subject to § 7. This conclusion will apply as long as you are on a bona fide unpaid leave of absence from your ABC position. A period of absence from your position due to vacations, holidays, personal time or illness, for example, would not insulate you from state employee status during that period because you would be receiving commonwealth benefits attributable to the leave period.

2. Special state employee status

You should also be aware that a state employee who works part-time may under certain circumstances have a contract with another state agency. Section 1(o) defines in pertinent part a special state employee as one who occupies a position which, by its classification in the state agency involved or by the terms of the contract or conditions of employment, permits personal or private employment during normal working hours provided that disclosure of such classification or permission is filed in writing with the State Ethics Commission prior to the commencement of personal employment. In this regard, § 7(d) states that the prohibition in § 7 shall not apply to a special state employee who does not participate^[2] in or have official responsibility^[3] for any other activities of the contracting agency. Section 7(d) also requires you to file a disclosure of your financial interest in the contract you would have with DCPO. Inasmuch as your work with ABC does not place you in a position of participating or having official responsibility for matters in DCPO, you would be eligible for the exemption in § 7(d) were you to obtain special state employee status.

 

End Of Decision

^[1] This citation refers to prior Commission conflict of interest opinions including the year these were issued and their identifying numbers. Copies of advisory opinions (with identifying information deleted) are available for public inspection at the Commission offices.

^[2] 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, county or municipal employee, through approval, disapproval, decision, recommendation, the rendering of advice, investigation or otherwise." G.L. c. 268A. § 1(j).

^[3] For the purposes of G.L. c. 268A, "official responsibility" is defined as "the direct administrative or operating authority, whether intermediate or final and either exercisable alone or with others, and whether personal or through subordinates, to approve, disapprove or otherwise direct agency action." G.L. c. 268A, § 1(i).