Opinion  EC-COI-86-13

Date:	06/16/1986
Organization:	State Ethics Commission
Location:	Boston, MA

A police chief would violate §19 of the conflict of interest law by participating in liquor license matters affecting a liquor establishment that is 50% owned by his spouse unless he first obtains a §19(b)(1) exemption from his appointing authority.

Facts

You are the police chief in a city (City). In that capacity you are the chief investigative officer of infractions by liquor license holders, although in practice you have delegated most of the investigative responsibilities to three other police officers. Following the investigation of infractions (e.g. selling liquor to minors or remaining open beyond permissible hours) you or your department may submit to the city licensing board (board) a complaint against the license holder. The board, which has issued approximately sixty liquor licenses, will thereafter review the complaint and determine what sanctions, if any, should be imposed against the liquor license holder. The board will also periodically request from your department information concerning criminal law violations by license holders.

As police chief, you are also responsible for assigning police officers to areas in which license holders are located, and for investigating alleged violations of criminal laws at these establishments. Your wife is the 50% owner with another individual of a liquor establishment, ABC, which holds a liquor license issued by the board.^[1] ABC is a neighborhood pub.

Question

In view of your wife's ownership interest in ABC, what limitations does G.L. c. 268A place on your official activities as they relate to liquor license holders?

Answer

Absent written permission from your appointing officials pursuant to G.L. c. 268A s.19(b)(1), you may be in violation of G.L. c, 268A s.19 by participating as chief in any matter affecting the financial interest of any liquor license holder in the city.^[2]

Discussion

In your capacity as police chief, you are a municipal employee within the meaning of G.L. c. 268A. EC-COI-85-65. By virtue of your municipal employee status, you are required by G.L. c. 268A, s.19 to refrain from participating^[3] as police chief in any decision, determination, or other particular matter^[4] in which your wife has a financial interest. The prohibition of s.l9, in effect, relieves you from choosing between the public's interests and your family's interests in the exercise of your official duties. Section 19 assures the public that its interests will not be clouded by potentially competing private interests. Compare, Graham v. McGrail, 370 Mass. 133(1976); Scuito v. City of Lawrence, 389 Mass 939(1983). Exemptions from s.19 may be granted only by your appointing officials pursuant to s.19(b)(1).

As applied to you, G.L. c. 268A, s.19 clearly prohibits your participation in any particular matter involving ABC because of your wife's 50% ownership interest in the pub. The prohibition applies in particular to the assignment of officers to ABC, the investigation of alleged infractions involving ABC, and the communications between the police department and board concerning violations of law by ABC. Because the consequence of a liquor law violation may be the suspension or termination of a liquor license, your wife has a financial interest in each matter in which you participate involving ABC.

The prohibition on your official activities extends beyond your involvement in ABC matters. Section 19 prohibits your participation in any matter affecting your wife's financial interest and necessarily includes matters affecting competitors of ABC. Because the consequence of an investigation of an infraction by a competitor may be the suspension or termination of the competitor's liquor license, the removal of a competitor would have a foreseeable financial impact on ABC. See, EC-COI-81-118; 82-95; 82-98. You must, therefore, not participate as police chief in the assignment of any police officer to, or in the investigation of, any complaint involving a liquor license holder which is in competition with ABC.

Based upon the information which you have provided, it is unclear if the scope of the competitive area is less than the entire city. Because your appointing officials are in a better position than the Commission to identify the local factors which would make a liquor license holder a competitor with ABC, you should review your situation with them. Under s.19(b)(1), your appointing officials may grant you written permission to participate in matters in which your wife may have a financial interest.^[5] The s. 19(b)(1) procedure therefore allows your appointing officials to accommodate the needs of the department to have a chief who can deal with liquor license matters with the public interest in having those dealings unclouded by potentially competing private loyalties.

Section 23(b)(2) is also relevant to your question. Under this paragraph, you may not use your official position as police chief to secure unwarranted privileges or exemptions of substantial value which are not properly available to similarly situated individuals. St. 1986, c. 12. For example, you may not direct officers to treat ABC differently from other liquor establishments with respect to the investigation of infractions. You must also refrain from providing rewards to a police officer because of favorable action he has taken towards ABC, or from treating adversely any police officer because of unfavorable action he has taken towards ABC. See, Craven v. State Ethics Commission, 390 Mass.191 (1983). You should keep these principles in mind in particular when determining such personnel matters as promotions, shift assignments, detail opportunities and assignments, overtime opportunities and performance evaluations.^[6]


End of Decision

[1] The pub was purchased several years ago from another police officer. Although it is unclear whether you also share the ownership of the pub, it is unnecessary to resolve this point. The Commission's conclusions regarding the application of s.s.17,19 and 29 would be the same in either case.

[2] The advice provided in this opinion is intended to guide your prospective conduct and does not purport to review the propriety of your prior activities, The opinion is limited to the application of G.L. c. 268A. You should ascertain from your City Solicitor the extent to which other statutes may regulate your activities.

[3] G.L.c. 268A, s.1(j), defines "participate" as participate in an agency action or in a particular matter personally and substantially as a state, county and municipal employee, through approval, disapproval, decision, recommendation, the rendering of advice, investigation or otherwise.

[4] G.L.c. 268A, s.1(k) defines "particular matter", any judicial or other proceeding, application, submission, request for a ruling or other determination, contract claim, controversy, charge, accusation, arrest, decision, determination, finding, but excluding enactment of general legislation by the general court and petitions of cities, towns, counties and districts for special laws related to their governmental organizations, powers, duties, finances and property.

[5] The statute requires a written determination that the financial interest is not so substantial as to be deemed likely to affect the integrity of your services as police chief.

[6] As a municipal employee, you are also subject to the restrictions of G L. c. 268A, s.17(a) and (c). Although not directly raised by your opinion request, these sections come into play whenever ABC has a matter pending before any agency of the city, including the police department. Under s.17, you may not receive compensation from ABC or act as the agent of ABC with respect to any of its dealings with city agencies or employees.

Members of the police department who are assigned to investigate complaints or to prepare reports involving ABC or any other license holders must comply with certain standards of conduct to assure that their actions will not be influenced by the fact that your wife is a owner of ABC. Under G.L c. 268A. s.23, they may not use their official position to secure unwarranted privileges or exemptions of substantial value to ABC, or act in a manner which would cause a reasonable person, having knowledge of the relevant circumstances, to conclude that they are likely to act or fail to act with respect to ABC because of their subordinate relationship to you. Issues under this section inevitably arise whenever police officers are assigned to investigate alleged violations by ABC. If an officer were to overlook an obvious violation at ABC because your wife has an ownership interest in the pub, the officer would violate s.29. See In the John Saccone. 1982 Ethics Commission 87, reversed on other grounds sub nom. Saccone v. State Ethics Commission, 395 Mass. 326(1985). Your subordinate officers should be made aware of these principles: any officer who has a specific question about the application of s.29 may seek further guidance from the Commission.