Conflict of Interest Law Questions and Answers
Housing authority and redevelopment authority members and employees are municipal employees covered by the conflict of interest law (G.L. c. 268A). This is true even for the members appointed by the state Department of Housing and Community Development. Although only housing authority members and employees are mentioned below, the advice is about redevelopment authority members and employees as well.
The conflict of interest law applies to all municipal employees, whether elected or appointed, full-time or part-time, paid or unpaid. The purpose of the conflict law is to ensure that your private interests and relationships do not conflict with your responsibilities as a housing authority member or employee. The law is broadly written to prevent you from becoming involved in a situation that could result in a conflict or give the appearance of a conflict. The law also regulates the activities of former employees and business partners of current and former employees.
"Special Municipal Employee" Status
By law, housing authority members (but not housing authority employees) are "special municipal employees" to whom the law in some instances will apply in a less restrictive way. People who provide professional services for a housing authority on a part-time, intermittent or consultant basis are also special municipal employees. Such professionals include architects, attorneys, engineers, planners, or experts in construction, finance, real estate or traffic. (See G.L. c. 121B, § 7.)
For municipal employees who have been designated "special," two sections of the conflict law -- §§ 17 and 20 -- apply less restrictively than they do to regular municipal employees. All other sections of the conflict law that affect municipal employees apply to special municipal employees in the same way.
The legislation creating housing authorities specifically states that "each member of a [a housing and redevelopment authority] . . . shall be considered a special municipal employee." See G.L. c. 121B, § 7. In so doing, the Legislature was careful to point out that the city council, board of aldermen or board of selectmen was not precluded from making other employees of such authorities "specials."
The positions of housing authority employees who are not members may be designated as "special municipal employee" positions by the board of selectmen or city council. A position may be designated as special on formal vote by the appropriate board at any time provided that an employee:
- is not paid; or
- holds a part-time position which allows him or her to engage in other employment during normal working hours; or
- was not paid by the municipality for more than 800 hours during the preceding 365 days.
All employees holding the same office or position must be treated the same, having the same classification as special municipal employee. For example, if one part-time secretary at a housing authority is classified as a special, all part-time secretaries should be so classified.
Bribes (Section 2)
Section 2 of the conflict law prohibits the most obvious kind of corruption: bribes. The law imposes criminal penalties, not only on officials who seek or receive payoffs or kickbacks, but also on private parties who offer or pay them. Criminal conviction under § 2 bars you from holding any state, county or municipal position.
Restrictions on Accepting Gifts (Sections 3 and 23)
It is illegal to request or accept anything of "substantial value" – in other words, anything with a value of $50 or more -- from anyone if you receive it "for or because of" a specific official act or an act within your official responsibility that you have performed or will perform as a housing authority member or employee. It is also illegal for a private party to offer or give anything of substantial value to you because of such acts that you performed or will perform. This is true even if there is no corrupt intent on the part of either the giver or the receiver.
You also may not request or accept a gift of substantial value from anyone if you are receiving it because of the official position you hold as a housing authority member or employee, even if the motivation for the gift is to express gratitude for a job well done or to foster goodwill.
Public employees may accept specific types of gifts with a value of $50 or more either because the conflict of interest law does not prohibit them or because exemptions to §§ 3 and 23 or G.L. c. 268B, § 6 allow public employees to accept them. For more information about restrictions on receiving such gifts, see the Commission’s Primer on Receiving Gifts and Gratuities.
If you receive a gift with a value of less than $50, you may have to file a disclosure. If a reasonable person would conclude that you would show undue favor toward the giver or you would be improperly influenced by the giver because of the gift, you must file a disclosure before performing duties for the housing authority in relation to the giver. The housing authority may make a rule about gifts with a value of less than $50 that is stricter than the rule in the conflict of interest law.
Prohibited Actions Affecting Financial Interests (Section 19)
The law recognizes that your objectivity can be compromised when you act on matters in which you -- or a family member or close business associate -- have a financial stake. To discourage "self-dealing", the law prohibits you from participating in a particular matter in which you or any of the following have a financial interest:
- your immediate family (you, your spouse and each of your parents, children, brothers and sisters);
- your partner(s);
- a business organization in which you serve as an employee, officer, director, trustee or partner (including some non-profit organizations); and
- any person or organization with whom you are negotiating or have any arrangement concerning prospective employment.
For example, as a housing authority member or employee, you should not participate in any discussions or vote on awarding a contract to your brother's development company, nor should you act on applications from competitors. The best course of action is to leave the room during any discussions or votes concerning the matter.
- In an October 1984 enforcement case, the Commission found two Randolph Housing Authority members in violation of this section of the law by participating in a decision to invest Housing Authority funds in a bank at which both members were employed.
- In a March 1987 case, the Commission found the Mayor of Chelsea to have violated this section of the law by appointing his brother to the local housing authority.
A "particular matter" is defined by statute to include almost any proceeding, application, request for determination, contract, claim, finding, decision or controversy which might come before you. The definition refers to specific matters and proceedings rather than general issues. Section 19 does not apply if the particular matter involves a determination of general policy and your interest is shared with a substantial segment of the population of the town. For example, you could vote on raising or lowering local property tax rates, even if you are a homeowner, because your personal financial interest is shared with the majority of citizens in your town.
There is another exemption under § 19 available to appointed municipal employees. Appointed municipal employees may act on a matter affecting their own financial interest or the financial interest of their immediate family members, their business partners, their business organization or their potential future employers if they file a disclosure and receive written permission from their appointing authority prior to taking any action.
Prohibited Municipal Contracts and Multiple Jobs (Section 20)
Section 20 of the conflict law prohibits a municipal employee from having a financial interest in a contract with his or her city or town or any municipal agency. Employment is considered a contract, and thus this section prohibits housing authority employees from having a second job with their city or town.
However, exemptions to § 20 make it possible to have additional jobs with a city or town if specified requirements are met. Employees whose positions have not been designated special may hold more than one paid position with the city or town only under limited circumstances, and most often when the second position is an advertised job with a municipal agency whose work does not have anything to do with the housing authority.
Two exemptions are available to special municipal employees, including housing authority members, professionals who provide service to the housing authority and any employee whose position has been designated special. "Specials" may have an additional job with their city or town as long as they comply with the disclosure requirements in the exemptions.
When you do your work for the housing authority as a special municipal employee, do you participate in, or have official responsibility for, the other municipal agency which will employ you? If the answer is no, you are eligible for an exemption under if you file a disclosure with the city or town clerk making full disclosure of the other employment relationship. If the answer is yes, however, you must get approval from the city council, aldermen, board of selectmen, or district prudential committee before you file your disclosure with the city or town clerk. For example, you could just file a disclosure to have a second job with the public schools, but you would need approval from the city council, aldermen, board of selectmen, or district prudential committee of the exemption under § 20 to have a second job with the housing authority.
Any housing authority employee may hold any elective office other than mayor in the city or town, but the exemption which allows this requires compliance with certain conditions. The employee only may be paid either for the elected position or the housing authority position. An individual who is both an elected official and a housing authority employee also must abstain from participating as an elected official in any particular matter that is within the purview of the housing authority, and may not be appointed to any additional position with the same city or town until six months after leaving the elected position.
Section 20 also prohibits a municipal employee of a city or town to have a financial interest in other kinds of contracts with the same city or town, for example, contracts to buy, sell or rent goods, equipment or real estate, unless the requirements of an exemption are satisfied.
Finally, some specific exemptions under § 20 may allow you to engage in the following activities that have to do with housing authorities:
- You may take advantage of a housing subsidy program administered by the housing authority.
- If you own residential rental property, you may rent to a tenant receiving a rental subsidy administered by the housing authority.
- You may take advantage of affordable housing programs and community development programs administered by the housing authority or municipal agencies.
You may not engage in the activities listed above, however, if you, as a housing authority member or employee, have responsibility for the administration of the program involved.
There are a number of other exemptions to the general rules regarding holding multiple positions or having contracts with the municipality, in addition to the exemptions discussed above. All of the exemptions cannot be adequately explained in this summary. Please be sure to ask the Ethics Commission or your town counsel for advice concerning contracting with your town.
Restrictions after Hours (Section 17)
The law limits what you may do for someone other than the municipality which you serve; in other words, what you may do on the side. This section is designed to protect both the housing authority members and employees and the municipality from the problems that result when people "serve two masters."
While you work for the housing authority in a city or town, unless you are a special municipal employee, you may not act as agent or attorney for a private party before any municipal agency or board in the same city or town, even if you are not paid. You also may not be compensated by anyone else in relation to any "particular matter" in which any agency of the same municipality is a party or has a direct and substantial interest. If you are a special municipal employee, you may represent private parties before town boards other than the housing authority, as long as you have not been involved in the particular matter in question as a municipal employee and as long as the housing authority is not likely to become involved in the matter.
For example, if you are a lawyer in private practice and you become a housing authority member (and thus a special municipal employee), you would be allowed to represent a client before any town agency other than the housing authority. If you were a regular municipal employee of the housing authority, however, you would be precluded from representing a client before any municipal agency.
The law also restricts the activities of business partners of current municipal employees. Your partner may not act as agent or attorney for anyone other than your city or town in connection with a particular matter if you have participated as a housing authority member or employee in the matter or the matter is a subject of your official responsibility. For example, your business partner may not represent a developer in her application to the housing authority for an extension on her project.
Misuse of Official Position (Section 23)
Section 23 provides a general code of conduct for all public employees. The conflict law prohibits you from using or attempting to use your official position to secure an unwarranted privilege for anyone or from giving a reasonable basis for the impression that you can be improperly influenced in the performance of your official duties. The law also prohibits you from disclosing confidential information obtained on the job and from accepting outside employment that will impair your independence of judgement in the exercise of your official duties.
- In a 1982 case the Commission found a Worcester Housing Authority Deputy Director had violated § 23 by securing discounts on personal purchases from a private business that did business with the housing authority, and by using the housing authority's tax exempt organization number to avoid paying sales tax on a number of personal purchases. The Commission found the housing authority member used his official position to garner unwarranted privileges in these instances.
Restrictions after You Leave Government Service (Sections 18 and 23(c))
Former housing authority members and employees are subject to restrictions on doing work for their next employers or other people or entities on matters they worked on as housing authority members and employees. They also may not improperly disclose confidential material or data obtained while serving the housing authority or use such information for personal purposes.
The law does not prevent you from using general expertise developed while employed by the housing authority. Rather, it focuses on particular matters you worked on at the housing authority.
If you participated in a particular matter as a housing authority member or employee, you can never become involved in that same matter for a private party or anyone else except the town after you leave municipal service. (This same restriction applies to your business partners for one year after you leave the board).
If you had official responsibility for a particular matter as part of the housing authority at any time within a two-year period prior to the termination of your employment, even if you did not actually participate in it, you may not appear before any municipal agency on behalf of a private party in connection with that matter for one year after leaving the board.
For example, if you voted as a housing authority board member to award a company a contract to provide computer services for the housing authority, you may not leave town government and work for the company on the same contract you voted on. You may, however, work for that company on other projects and you may also work for the company on town contracts proposed and awarded after you left the board.
This summary presents a brief overview of the conflict law and suggests activities which you, as a housing authority member or employee, must avoid. It is not a comprehensive review. You may call the Ethics Commission's Legal Division at 617-371-9500 for particular advice on the conflict law, as well as seek an advisory opinion from your town counsel or city solicitor. As of April 1986, the Commission regularly reviews town counsel opinions on the conflict law.
If you have a question about your own activities, we urge you to request an opinion from your local counsel or directly from the Commission prior to engaging in the activity in question.
ISSUED: July 1989
REVISED: October 2017