Ethics Advisory Opinion No. 76
August 1, 2003
Issued By:
City Attorney’s Office
I. Issue
May a
city employee and members of his family who own a restaurant business enter
into a contract with the city to provide catering services?
II. Factual
Background
The city employee making
this inquiry has worked for the City of
The employee and his wife
own 30% of a family restaurant business.
His brother-in-law and his mother and father-in-law own the other
70%. A representative of the city
contacted the restaurant owned by the employee and his family seeking catering
services for the city. The employee has
inquired whether the Ethics Code would prohibit him or his family business from
entering into a contract with the city to provide this service.
III.
Analysis
A. Prohibited
Interest in Contracts
Section
141 of the City Charter and Part B, Section 10 of the Ethics Code (currently codified in Ethics Code Section 2-52 ) bar a city officer
or employee from having a financial interest in a contract with the city or its
agencies. Generally, a city employee is anyone on the city payroll. Ethics Code Part A, Section 2 (currently codified in Ethics Code Section 2-42). However, for
purposes of Section 141 of the City Charter, the definition of employee is
limited to only employees who are required to file a financial disclosure
statement. Ethics Code Part B, Section 10(c) (currently codified in Ethics Code Section2-52(e)).. Under Part B, Section 10(c) (currently codified in Ethics Code Section 2-52)), an employee who files a
financial disclosure statement may not have any interest, direct or indirect,
in a contract with the city. Such an
employee would also have a prohibited financial interest if he owned 10% or
more of a business that had a contract with the city. Ethics Code Part B, Section 10(b) (currently codified in Ethics Code Section 2-52(b))..
The employee
in this matter is not an employee who is required to file the financial
disclosure statement. The contract
prohibition under Section 141 of the City Charter and Part B Section 10 of the
Ethics Code (currently codified in Ethics Code Section 2-52), therefore, would
not apply to him or preclude him or his family from entering into a contract
for catering services with the city.
B. Conflicting
Outside Employment
Part B,
Section 6 of the Ethics Code (currently codified in Ethics Code Section 2-48 ) states that a city employee
cannot solicit, accept or engage in concurrent outside employment which could
impair or interfere with the employee’s official duties. In addition, under Personnel Rule XXIV, the
employee must obtain written approval from his department before engaging in
the outside employment. Assuming that the outside employment will not interfere
with the employee’s work for the city and assuming the department head has
approved the additional employment in writing, the employee may participate in
the family-owned business.
C. Unfair
Advancement of Private Interests
Part B,
Section 2 (currently codified in Ethics
Code Section
2-44) prohibits the use of a city employee’s position to unfairly advance or
impede the private interests of another or to grant or secure for any person,
including the employee himself, any form of special consideration beyond that
which is lawfully available to other persons.
Again, should some issue regarding the family business come before the
employee’s department, he could not participate in any related action, nor use
his position to influence others who work for the city.
D. Public
Property and Resources
A city
official or employee cannot use, request or permit the use of city facilities,
personnel, equipment or supplies for private purposes except to the extent and
according to the terms that those resources are lawfully available to the
public Part B, Section 7(currently
codified in Ethics Code Section 2-49). The
employee, therefore, cannot use any city resource, including the time for which
he is scheduled to work for the city, for a private purpose, including
attending to the family business.
IV. Conclusion
The
“prohibited interests in contracts” provision of the City Charter and Part B,
Section 10 of the Ethics Code (currently codified in Ethics Code Section 2-52) prohibits
only an official or employee required to file a financial disclosure statement
from having an interest in a contract with the city. Since this employee is not in this category,
the prohibition would not apply. The
employee, though, should remain cognizant of the other obligations and responsibilities
imposed upon him by the Ethics Code as discussed in this opinion.