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Settlement

Settlement  In the Matter of Whiting Willauer

Date: 09/27/2011
Organization: State Ethics Commission
Docket Number: 11-0019
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Disposition Agreement

The State Ethics Commission ("Commission") and Whiting Willauer ("Willauer") enter into this Disposition Agreement pursuant to Section 5 of the Commission's Enforcement Procedures. This Agreement constitutes a consented-to final order enforceable in the Superior Court, pursuant to G.L. c. 268B, § 4(j).

On April 15, 2011, the Commission initiated, pursuant to G.L. c. 268B, § 4(a), a preliminary inquiry into possible violations of the conflict of interest law, G.L. c. 268A, by Willauer. The Commission has concluded its inquiry and, on September 16, 2011, found reasonable cause to believe that Willauer violated G.L. c. 268A.

The Commission and Willauer now agree to the following findings of fact and conclusions of law:

Findings of Fact

  1. Willauer was a member of the Nantucket Board of Selectmen ("BOS") from April 2005 through March 2008, and from April 2010 to the present.
  2. Willauer served on the board of directors of the Alliance for Substance Abuse Prevention, Inc. ("ASAP") from November 2003 until May 2011. ASAP is a non-profit organization whose mission is to provide leadership, education, and support in the community for the prevention and treatment of alcoholism, addiction, substance abuse, and related problems.
  3. Since June 2008, Willauer has served as the uncompensated president of a nonprofit organization called Family & Children's Services of Nantucket County, Inc., doing business as Nantucket Behavioral Health Services, Inc. ("BHS"). BHS provides outpatient mental health services, and operates the only licensed mental health clinic on Nantucket.
  4. In 2006 and 2007, Willauer, as a BOS member, voted to award contracts to ASAP in the amounts of $5,000 and $15,000, respectively.
  5. On June 23, 2010, the BOS, with Willauer participating in his capacity as a selectman, voted to award a $152,100 town contract to BHS and ASAP as a joint venture.
  6. On June 23, 2010, Willauer, as president of BHS, signed the $152,100 contract on behalf of BHS.
  7. At its November 17, 2010 meeting, the BOS discussed whether Willauer had a conflict of interest when he participated in the June 23, 2010 vote to award the $152,100 town contract to BHS/ASAP. Willauer stated that he (Willauer) needed clarification on how to handle such situations in the future. Willauer did not take any steps to obtain such clarification.
  8. At the December 8, 2010 BOS meeting, a BOS member moved that, in light of the conflict of interest concerns previously raised, the BOS re-vote whether to award the $152,100 town contract to BHS/ASAP, previously approved at the June 23, 2010 BOS meeting. The BOS re-voted 4-0 in favor of awarding the contract to BHS/ASAP, with Willauer participating.

Conclusions of Law

  1. As a BOS member in a town with a population of 10,000 or fewer persons, Willauer was, at all times relevant to this matter, a special municipal employee as defined in G.L. c. 268A, § 1.

Section 19

  1. Section 19, in relevant part, prohibits a municipal employee from participating[1] as such an employee in a particular matter[2] in which to his knowledge, a business organization in which he is serving as officer, director, trustee, partner or employee, has a financial interest.[3]
  2. The BOS's decision to award the $152,100 town contract to BHS/ASAP was a particular matter.
  3. Willauer, as a BOS member, participated in the particular matter by voting at both the June 23, 2010 and the December 8, 2010 BOS meetings to award the $152,100 town contract to BHS/ASAP.
  4. Although BHS is a non-profit organization, it appears to be a business organization for purposes of the conflict of interest law, as its activities regularly involve providing services for fees, and these activities constitute a significant portion of BHS's total activities. See EC-COI-07-2.[4]
  5. As BHS' president, Willauer is an officer of a business organization.
  6. BHS, as a recipient of the $152,100 town contract awarded to the joint venture of BHS/ASAP, had a financial interest in the particular matter.
  7. At the time of his participation, Willauer knew that BHS had a financial interest in the particular matter.
  8. Accordingly, by participating as a selectman in each decision to award the $152,100 town contract to BHS/ASAP at the June 23, 2010, and the December 8, 2010 BOS meetings, while he was also serving as BHS' president, and while he knew that BHS had a financial interest in those decisions, Willauer violated § 19.

Section 17(c)

  1. Section 17(c) prohibits a municipal employee from, otherwise than in the proper discharge of his official duties, acting as agent for anyone other than the same municipality in connection with a particular matter in which the municipality is a party or has a direct and substantial interest.
  2. A special municipal employee is subject to § 17(c) only in relation to a particular matter (a) in which he has at any time participated as a municipal employee, or (b) which is or within one year has been a subject of his official responsibility, or (c) which is pending in the municipal agency in which he is serving.
  3. The award of a $152,100 town contract to BHS/ASAP was a particular matter.
  4. The contract was a subject of Willauer's official responsibility as a BOS member, as the BOS voted to award the contract on June 23, 2010.
  5. The town was a party to the contract.
  6. On June 23, 2010, as BHS' president, Willauer signed the $152,100 town contract. Thus, Willauer acted as BHS's agent in connection with the contract.
  7. Willauer's actions as agent for BHS were not in the proper discharge of his official duties.
  8. Willauer's actions as agent were in connection with a particular matter, the award of a $152,100 town contract to BHS/ASAP, which, at the time he acted as BHS' agent was, or within one year had been, the subject of Willauer's official responsibility as a BOS member.
  9. Therefore, by as BHS president, signing the $152,100 town contract, which, at the time he so acted was, or within one year had been, the subject of his official BOS responsibility, Willauer violated § 17(c).

Section 23(b)(3)

  1. Section 23(b)(3) of G.L. c. 268A prohibits a municipal employee from, knowingly, or with reason to know, acting in a manner which would cause a reasonable person, having knowledge of the relevant circumstances, to conclude that any person can improperly influence or unduly enjoy his favor in the performance of his official duties, or that he is likely to act or fail to act as a result of kinship, rank, position or undue influence of any party or person. The section further provides that it shall be unreasonable to so conclude if such employee has disclosed in writing to his appointing authority or, if no appointing authority exists, discloses in a manner which is public in nature, the facts which would otherwise lead to such a conclusion.
  2. By participating in his capacity as a BOS member in the award of contracts to ASAP,[5] a non-profit organization on whose board of directors he was serving, Willauer knowingly, or with reason to know, acted in a manner which would cause a reasonable person, having knowledge of all the relevant circumstances, to conclude that ASAP could unduly enjoy his favor in the performance of his official duties. Willauer did not file any § 23(b)(3) disclosure to dispel this appearance of impropriety. Therefore, in so acting, Willauer repeatedly violated § 23(b)(3).

In view of the foregoing violations of G.L. c. 268A by Willauer, the Commission has determined that the public interest would be served by the disposition of this matter without further enforcement proceedings, based on the following terms and conditions agreed to by Willauer:

  • that Willauer pay to the Commonwealth of Massachusetts, with such payment delivered to the Commission, the sum of $3,000 as a civil penalty for violating G.L. c. 268A, §§ 17(c), 19 and 23(b)(3); and
     
  • that Willauer waive all rights to contest, in this or any other administrative or judicial proceeding to which the Commission is or may be a party, the findings of fact, conclusions of law and terms and conditions contained in this Agreement.

[1] "Participate" means to 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).

[2] "Particular matter" means 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. G.L. c. 268A, § 1(k).

[3] "Financial interest" means any economic interest of a particular individual that is not shared with a substantial segment of the population of the municipality. See Graham v. McGrail, 370 Mass. 133 (1976). This definition has embraced private interests, no matter how small, which are direct, immediate or reasonably foreseeable. See EC-COI-84-98.The interest can be affected in either a positive or negative way. EC-COI-84-96.

[4] In EC-COI-07-2 the Commission decided, in certain circumstances, some non-profit organizations were "business organizations" for purposes of the conflict of interest law. The Commission uses a four factor test to determine whether a non-profit is a business organization. Those factors are:

  1. whether the organization's activities involve commerce, trade, the sale of goods or the provision of services in exchange for fees (or other compensation) or any other activities, including professional activities, that are commonly understood to be business activities;
  2. whether the organization's business activities are engaged in for its support or profit;
  3. whether the organization's business activities are continuously or regularly engaged in; and
  4. whether the organization's business activities constitute a significant rather than de minimis portion of the total activities of the organization.

[5] ASAP does not appear to be a business organization for purposes of the conflict of interest law as it mainly provides advocacy, education and support without collecting any fees, and it is not involved in any other activities that are commonly understood to be business activities.

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