Advisory Opinion No. 2011-25

Re: The Honorable Jared R. Nunes

QUESTION PRESENTED

The Petitioner, a member of the Rhode Island House of Representatives, a state elected position, who in his private capacity is an employee, officer and part-owner of R.T. Nunes & Sons, Inc., requests an advisory opinion regarding whether R.T. Nunes & Sons, Inc. can: 1) continue to provide snow plowing services to the Rhode Island Department of Transportation given that it has done so continuously for the past twenty-eight (28) years; 2) bid on projects advertised by Rhode Island state agencies in the capacity of a general contractor; and 3) bid on projects advertised by a general contractor to work as a subcontractor on state agency projects.

RESPONSE

It is the opinion of the Rhode Island Ethics Commission that the Code of Ethics does not prohibit R.T. Nunes & Sons, Inc. from continuing to provide snow plowing services to the Rhode Island Department of Transportation, notwithstanding the fact that the Petitioner, an employee, officer, and part-owner, is an elected member of the Rhode Island House of Representatives, given that such employment was held at the time of the Petitioner’s election to office. The Code of Ethics does prohibit R.T. Nunes & Sons, Inc. from bidding on any other publicly advertised projects with state agencies for the duration of Petitioner’s service in the General Assembly and for a period of one (1) year thereafter. However, this prohibition does not apply to work as a subcontractor for another general contractor on state agency projects.

The Petitioner was elected to the Rhode Island House of Representatives in November 2010. He represents that he is also a minority owner and secretary of R.T. Nunes & Sons, Inc. (“Nunes & Sons”), a construction, paving, and asphalt company. He advises that Nunes & Sons has a diverse business, working on projects such as the installation of underground utility pipes for water and sewer mains, asphalt and concrete paving, landscaping and drainage work. He states that his duties at Nunes & Sons primarily consist of site supervision at various projects. He also states that he personally has no involvement in the preparation of bid proposals.

The Petitioner informs that Nunes & Sons has been providing snow plowing services to the Rhode Island Department of Transportation (“DOT”) for over twenty-eight (28) years. He explains that Nunes & Sons secured a place on the snow plow list and has continuously renewed its contract with the DOT each fall, plowing the same routes year after year. He informs that unlike a typical bidding process, the DOT sets the hourly rates each year for the snow plow operators to accept or reject.

Outside of snow plowing, the Petitioner represents that the majority of Nunes & Sons’ work consists of private sector projects. Significantly, however, he states that Nunes & Sons has, from time to time, bid on publicly advertised projects with state agencies. He advises that Nunes & Sons’ projects with state agencies, other than snow plowing, have separate and distinct contracts for each individual job. According to the Petitioner, irrespective of snow plowing, Nunes & Sons most recently contracted directly with a state agency in 2002, performing work for the Rhode Island Economic Development Corporation.

The Petitioner represents that Nunes & Sons has also contracted with other general contractors to work as a subcontractor on state agency projects. He advises that since 1985 Nunes & Sons has worked as a subcontractor on ten (10) state agency projects, most recently in 2009. Moreover, he states that Nunes & Sons is a qualified Minority Business Enterprise. Pursuant to Rhode Island General Laws section 37-14.1-6, “[m]inority business enterprises shall be included in all procurements and construction projects [for the state] and shall be awarded a minimum of ten percent (10%) of the dollar value of the entire procurement or project.” The Petitioner states that Nunes & Sons, in its capacity as a subcontractor, would be contacted by a general contractor seeking a quote for particular part of a state contract, sometimes in order for the general contractor to comply with the minority business enterprise statute. If that general contractor is awarded the state agency contract, the Petitioner advises that Nunes & Sons would sign a contract with the general contractor, not the state agency, and would be paid for its services directly by the general contractor.

Cognizant that the Rhode Island Code of Ethics contains certain prohibitions against state elected officials generally, and members of the General Assembly specifically, from seeking other state employment or work as an independent contractor, the Petitioner requests guidance as to whether Nunes & Sons can: 1) continue to provide snow plowing services to the DOT; 2) bid on other projects advertised by state agencies; and 3) bid as a subcontractor on state agency projects advertised by a general contractor.

The Code of Ethics contains both statutory and regulatory revolving door provisions that are applicable to current and former members of the legislature. Section 36-14-5(n)(1) of the Code of Ethics provides:

No state elected official, while holding state office and for a period of one (1) year after leaving state office, shall seek or accept employment with any other state agency, as defined in section 36-14-2(4), other than employment which was held at the time of the official’s election or at the time of enactment of this subsection, except as provided herein.

The term “employment,” as used in section 5(n), includes “service as an independent contractor or consultant to the state or any state agency, whether as an individual or principal of an entity performing such service.” Commission Regulation 36-14-5017.

While section 5(n) applies generally to all state elected officials, the Code of Ethics contains a more specific, regulatory prohibition that applies only to members of the General Assembly. Originally adopted in 1991 by the Ethics Commission, along with several other regulations aimed at strengthening the Code of Ethics, Commission Regulation 36-14-5007 (“Regulation 5007”) currently reads as follows:

No member of the General Assembly shall seek or accept state employment, not held at the time of the member’s election, while serving in the General Assembly and for a period of one (1) year after leaving legislative office. For purposes of this regulation, “employment” shall include service as defined in R.I. Gen Laws § 36-14-2(4) and shall also include service as an independent contractor or consultant to the state or any state agency, whether as an individual or a principal of an entity performing such service.

Significantly, the Rhode Island Supreme Court issued a decision in 1993 specifically upholding the constitutionality of both section 5(n) and Regulation 5007. In re Advisory from the Governor, 633 A.2d 664 (R.I. 1993). In its decision, our Supreme Court recognized that “the legislative aim of the revolving-door provisions is to ensure that public officials adhere to the highest standards of conduct, avoid the appearance of impropriety, and do not use their positions for private gain or advantage. Id. at 671 (citing R.I. Const., art. 3, sec. 7). The Court further observed that “[t]he integrity of our government officials is quintessential to our system of representation. In general the purpose of revolving-door provisions is to prevent ‘government employees from unfairly profiting from or otherwise trading upon the contacts, associations and special knowledge that they acquired * * *.’” Id. at 671 (quoting Forti v. New York State Ethics Comm’n, 554 N.E.2d 876, 878 (1990)). The Court concluded that “the revolving-door legislation is an effective device by which the public trust may be enhanced.” Id.

In the years following our Supreme Court’s 1993 decision, the Ethics Commission has several times applied section 5(n) and Regulation 5007 to legislators. For example, in Advisory Opinion 2009-44 the Ethics Commission opined that section 5(n) and Regulation 5007 both prohibited a legislator from providing arbitration or mediation services to a state agency, although he could continue to be listed on the Department of Administration’s master price agreement as qualified to provide such services to non-state entities.

Similarly, in Advisory Opinion 2006-25 it was determined that Regulation 5007 would apply to prohibit a member of the House of Representatives from providing insurance brokerage services (a consulting relationship) to a quasi-public state agency. In Advisory Opinion 2001-6, the Ethics Commission opined that both section 5(n) and Regulation 5007 prohibited a member of the House of Representatives from accepting work as a part-time instructor at Rhode Island College.

As an initial matter, it is important to note a distinction between Nunes & Sons’ other work for state agencies and its continuous snow plowing contract with the DOT. The continuous nature of the DOT’s snow plow list, based on the Petitioner’s representation that Nunes & Sons has remained on the DOT’s snow plow list for over twenty-eight (28) years without interruption, qualifies this contract and only this contract as employment held at the time of the Petitioner’s election. Accordingly, it is the opinion of the Ethics Commission that Nunes & Sons can continue to provide plowing services to the DOT because the plowing contract constitutes state employment held at the time of his election to the General Assembly, which is an exception to the prohibitions in both section 5(n) and Regulation 5007. See e.g. A.O. 93-53 (opining that a state representative may continue to work as paid consultant for Department of Business Regulation, notwithstanding Regulation 5007, since such work pre-dated his election).

However, based on the Petitioner’s representations that each contract for Nunes & Sons’ other state agency work was separate and distinct and completed several years prior to his election to office, such other work does not constitute employment held at the time of the Petitioner’s election to the General Assembly. The list of Nunes & Sons’ state agency projects provided by the Petitioner reveals that, aside from snow plowing, the last time Nunes & Sons contracted directly with a state agency was in 2002. A single instance of contracting directly with a state agency in the past ten years does not establish a regular, past practice of working for the state as an independent contractor. Therefore, given the Petitioner’s status as both a member of the General Assembly and an employee, officer, and part-owner of Nunes & Sons, it is the opinion of the Ethics Commission that both section 5(n) and Regulation 5007 prohibit Nunes & Sons from bidding on or accepting any new contracts with the State of Rhode Island, including the DOT, irrespective of whether the contracts are publicly advertised, for the duration of the Petitioner’s service in the General Assembly and for a period of one (1) year after leaving legislative office.

Although the Code of Ethics prohibits Nunes & Sons from contracting directly with any state agency, the Code does not prohibit Nunes & Sons from seeking and accepting work as a subcontractor for a general contractor who is seeking or has already been awarded a state agency contract. Based upon the Petitioner’s representations that Nunes & Sons’ contractual obligations as a subcontractor are only to the general contractor, and that Nunes & Sons is paid directly by the general contractor, Nunes & Sons is not in contractual privity with the state while working as a subcontractor on a state agency project. Therefore, such subcontracting work does not constitute state employment under section 5(n) or Regulation 5007. Accordingly, it is the opinion of the Ethics Commission that the Petitioner’s dual status as a member of the General Assembly and as an employee, officer and part-owner of Nunes & Sons, does not impair Nunes & Sons’ ability to subcontract with a general contractor to perform work on a state agency project.

In summary, based upon the Petitioner’s dual status as a member of the Rhode Island House of Representatives and also as an employee, officer and part-owner Nunes & Sons, it is the opinion of the Ethics Commission that: 1) Nunes & Sons can continue to provide snow plowing services to the DOT because it qualifies as employment held at the time of the Petitioner’s election to the General Assembly; 2) Nunes & Sons is prohibited by the Code of Ethics from bidding on any other publicly advertised projects with state agencies for the duration of the Petitioner’s service in the General Assembly and for a period of one year thereafter; and 3) Nunes & Sons is not prohibited by the Code of Ethics from working as a subcontractor for another general contractor on state agency projects.

Code Citations:

§ 36-14-5(n)

Commission Regulation 36-14-5004

Commission Regulation 36-14-5017

Other Authority Cited:

In re Advisory from the Governor, 633 A.2d 664 (R.I. 1993).

R.I. Gen. Laws § 37-14.1-6.

Related Advisory Opinions:

A.O. 2010-54

A.O. 2009-44

A.O. 2006-25

A.O. 2001-6

A.O. 93-53

Keywords:

Revolving Door

Prospective Employment