Conflicts of Interest

Many municipal ethics codes have a provision similar to this one: Contingent Fees No official or employee may retain, or be retained by, anyone to solicit or secure a contract with the town upon an agreement or understanding that includes a commission, percentage, brokerage, or contingent fee, except with respect to attorneys hired to represent the town on a common contingency fee basis. I had never thought twice about the exception for attorneys who work on a contingency fee basis until I read Adam Liptak's column in today's New York Times.

Areas to check:

1. Using office for private gain
2. using organization resources for personal purposes
3. soliciting gifts or accepting gifts from persons doing business with the organization
4. seeking or accepting private compensation for doing one's work (gratuities)
5. soliciting political contributions or political activity from subordinates
6. disclosure of confidential organization information or using this information for private purposes
7. appearing before organization agencies on behalf of private interests or representing private

In an earlier blog entry, I took the side of the Louisiana Board of Ethics in its dispute with the state legislature over whether it has jurisdiction over legislators who participate in debate when they have a conflict of interest. In another case, which the Board of Ethics lost on appeal, I feel the Board of Ethics was wrong, and I feel it is instructive to say why. The matter involved two parish council members who voted for themselves for mayor pro-tem.

A former chancellor of Maricopa Community College in Phoenix, Arizona continued to work for the college on contract, while also having a business on the side that did business with the college on a no-bid basis. The business was set up by the college when he was chancellor and was given to him a few months after he retired. The former chancellor denies any conflict of interest because his business (Sedona Conferences and Conversations, which does business with colleges around the world) is not always profitable. 'If I were really crazy about making money, I wouldn't be doing Sedona.

Buried in my blog entry on the Louisiana legislators' attempt to undermine recusal on constitutional grounds is a short discussion of what I refer to as 'the public-interested side' of recusal. I would like to talk a little more about this, because I think the failure to discuss it enough is a serious problem. When a government official has a conflict of interest, he or she is forced to choose between conflicting obligations.

No, the class exception does not except classy people from ethics codes. It excepts people from recusing themselves when the interests they have that would be affected by an act or decision are similar to a broad class of people. The biggest class is, of course, taxpayers. Municipal officials can vote for budgets even though their taxes are affected by it. Other classes excepted without controversy include homeowners, renters, members of a pension plan, and business owners.

Double-dipping occurs when someone holds two government jobs, usually at two different levels of government. This is not legal in many states, and for a good reason. It sets up many possible conflicts of interest, not the least of which is that when you're doing one job, you're not doing the other. It sometimes means actually dealing with yourself, wearing both your hats at once. It leads to a lot of pork-barrel spending, as local officials use their state power and local connections to direct state grant money.

Lobbyists, lawmakers, and charitable fundraising form a triangle that is both virtuous and harmful. Community leaders like to be identified with charitable groups, and charitable groups like to be identified with community leaders. It's a natural combination. But what is not natural, or even easy to see, is the line between charitable fundraising and campaign fundraising, when lobbyists, contractors, and developers enter into the picture. The typical problem involves a mayor's favorite charity.

Here's a difficult case involving a board of education's attorney. The board of education in a wealthy, medium-sized Connecticut town is represented by a large law firm that represents 80 boards of education across the state (half the state's total). That same firm is representing a developer that is suing the town's planning and zoning commission, and it appears to be a controversial matter. There is no doubt that the state's rules of professional conduct allow a firm to represent both a town and another client that is suing it, as long as there is no relationship between the matters.

My blog entries must often seem like attacks on business interests. One reason is that conflicts are usually about personal financial interests conflicting with a government official's obligations to the public, and our democratic values require that the official's fiduciary obligations take precedence. And where there are financial interests, there are usually businesses. But that is not always the case. Obligations themselves can conflict, without any direct financial interest.