Advisory Opinion No. 2012-34

Re: Shelley Pezza

QUESTION PRESENTED:

The Petitioner, a member of the Foster School Committee, municipal elected position, who is also a member of the Foster-Glocester Regional School Committee, requests an advisory opinion regarding whether the Code of Ethics prohibits her from participating in matters before either School Committee that involve Sodexo, Inc., the school lunch contractor for Foster and Glocester, given that the Petitioner’s family farm entered into an agreement with Sodexo to grow vegetables for the school lunch program.

RESPONSE:

It is the opinion of the Rhode Island Ethics Commission that the Petitioner, a member of the Foster School Committee, municipal elected position, who is also a member of the Foster-Glocester Regional School Committee, is prohibited by the Code of Ethics from participating in and voting on matters before either School Committee that involve Sodexo, Inc., given that the Petitioner’s family farm entered into an agreement with Sodexo to grow vegetables for the school lunch program.

The Petitioner is a current member of the Foster School Committee and the Foster-Glocester Regional (“FGR”) School Committee. The Foster School Committee has three members who oversee a single school, the Captain Isaac Paine Elementary School. By virtue of a their election to the Foster School Committee, all three members automatically serve as members of the FGR School Committee, which oversees Ponaganset Middle School and Ponaganset High School.

In her private capacity, the Petitioner and her family own and operate Pezza Farm, Inc. (“Farm”), located in Johnston, Rhode Island. She states that she is a member of the LLC that owns the land on which the Farm is situated and that she is a stockholder and employee of the Farm. She informs that the Farm is a year round business that grows and sells its produce, as well as nursery products and holiday decorations. She states that in addition to selling its products at its Farm Stand, the Farm participates in various farmers markets within Rhode Island and sells its vegetables wholesale to Roch’s Fruit & Produce, Inc. (“Roch’s”) and Farm Fresh.

The Petitioner states that in the spring of 2012, in her capacity as communications liaison for the Farm, she was contacted by Sodexo regarding whether the Farm could grow lettuce, broccoli, peppers, beans, cauliflower and cherry tomatoes for its school lunch menus in Rhode Island. She informs that the Farm and Sodexo entered into an oral agreement that the Farm would provide the produce requested by Sodexo and sell the produce wholesale to Roch’s, with Sodexo purchasing the produce directly from Roch’s. She states that the Farm was paid for the produce by Roch’s. She represents it was a difficult arrangement for the Farm to try to grow specific crops by Sodexo’s deadlines and that the Farm bore the entire risk of loss if a crop earmarked for Sodexo was not ready on time or was not of sufficient quantity. She further states that despite such difficulties, it is reasonably foreseeable that the Farm will work with Sodexo in the future to provide produce for its school lunch program.

The Petitioner informs that the renewal of Sodexo’s contracts with both the Foster School District and the FGR School District will be coming before the Foster School Committee and the FGR School Committee, respectively, in December 2012 or January 2013. She seeks advice as to whether she can participate and vote on matters involving Sodexo that may come before either the Foster School Committee or the FGR School Committee.

Under the Code of Ethics, a public official must recuse herself from participation when her business associate or a person authorized by her business associate, appears or presents evidence or arguments before her state or municipal agency. Commission Regulation 36-14-5002 (“Regulation 5002”); R.I. Gen. Laws § 36-14-5(f). The Code of Ethics also prohibits a public official from using her public office or confidential information received through her public office to obtain financial gain for herself, her family, her business associate, or any person by which she is employed or whom she represents. Section 36-14-5(d).

Additionally, a public official may not participate in any matter in which she has an interest, financial or otherwise, that is in substantial conflict with the proper discharge of her duties or employment in the public interest. Section 36-14-5(a). A substantial conflict of interest exists if an official has reason to believe or expect that she, any person within her family, a business associate or an employer will derive a direct monetary gain or suffer a direct monetary loss by reason of her official activity. Section 36-14-7(a). A business associate is defined as “a person joined together with another person to achieve a common financial objective.” Section 36-14-2(3). A person is defined as “an individual or a business entity.” Section 36-14-2(7).

In determining whether a relationship between two parties constitutes an ongoing business association as defined in the Code of Ethics, the Ethics Commission examines the nature of the association and the scope of the business dealings between the parties and looks to, among other things, whether the parties are conducting ongoing business transactions, have outstanding accounts, or there exists an anticipated future relationship. See A.O. 2010-16 (opining that an East Greenwich Planning Board member, who in his private capacity was the publisher of a local news and information website, was required to recuse when a business associate appeared before the Planning Board, specifically, if the business associate currently advertised on the petitioner’s website, had outstanding accounts, or when there was an anticipated future relationship between the parties).

In the present matter, the oral agreement between Sodexo and the Farm, whereby the Farm would grow specific quantities of certain vegetables earmarked for Sodexo’s school lunch program, constitutes a business association under the Code of Ethics. The Petitioner represents that it is reasonably foreseeable that a similar agreement could exist in the next growing season between the Farm and Sodexo. Given the existence of an anticipated future relationship between Sodexo and the Farm, Sodexo and the Farm are business associates. Furthermore, the Petitioner is a business associate of Sodexo because, as a part owner of the Farm, business associates of the Farm are considered to be business associates of the Petitioner.

Accordingly, Regulation 5002 and § 36-14-5(f) prohibit the Petitioner from participating or voting on any matters involving Sodexo before both the Foster School Committee and the FSG School Committee. Notice of recusal must be filed with the Ethics Commission in accordance with § 36-14-6.

Code Citations:

§ 36-14-2(3)

§ 36-14-2(7)

§ 36-14-5(a)

§ 36-14-5(d)

§ 36-14-5(f)

§ 36-14-6

§ 36-14-7(a)

Commission Regulation 36-14-5002

Related Advisory Opinions:

A.O. 2010-27

A.O. 2010-16

Keywords:

Business Associates

Private Employment