Advisory Opinion No. 2013-15 Advisory Opinion No. 2013-15 Re: James S. Bennett QUESTION PRESENTED The Petitioner, the Director of Economic Development for the City of Providence, a municipal appointed position, requests an advisory opinion regarding whether the Code of Ethics prohibits the City from paying for the Petitioner’s travel expenses relative to the economic development of the Port of Providence with funds donated to the City by ProvPort, the non-profit corporation that operates the Port of Providence. RESPONSE It is the opinion of the Rhode Island Ethics Commission that the Code of Ethics does not prohibit the City of Providence from paying for the Petitioner’s travel expenses relative to the economic development of the Port of Providence with funds donated to the City by ProvPort, the non-profit corporation that operates the Port of Providence. The Petitioner is the Director of Economic Development for the City of Providence (“City”), having been appointed by the Mayor to that position in August 2011. The Petitioner represents that the Mayor has also appointed him, as part of his official duties, to act as the administration’s liaison to ProvPort, a domestic non-profit corporation that operates the Port of Providence (“Port”), by serving as an ex officio non-voting member of the ProvPort Board of Directors.[1] The Petitioner represents that the City has substantial ongoing interests in the Port and in ProvPort’s success and decision-making relative to the Port’s operations. Consistent with these interests, ProvPort has offered to donate $30,000 to the City to be used exclusively to pay for travel expenses related to the economic development of the Port, which is mutually beneficial to both the City and ProvPort. The Petitioner states that only the Mayor could authorize withdrawals from this account. He informs that the Mayor plans to designate the Petitioner as a joint representative of the City and ProvPort to travel to meetings with potential Port clients both in the United States and abroad. He further represents that he would not have the authority to approve the use of these travel funds and could only undertake the travel under the direction of the Mayor. Under the Code of Ethics, a public official may not participate in any matter in which he has an interest, financial or otherwise, which is in substantial conflict with the proper discharge of his duties and employment in the public interest. R.I. Gen. Laws § 36-14-5(a). A public official will have an interest in substantial conflict with his official duties if he has a reason to believe or expect that a “direct monetary gain” or a “direct monetary loss” will accrue, by virtue of his official activity, to himself, a family member, a business associate, an employer, or any business which he represents. Section 36-14-7(a). A public official is also prohibited from using his public position or confidential information received through his position to obtain financial gain, for himself or his family or business associates, other than that provided by law. Section 36-14-5(d). Finally, Commission Regulation 36-14-5009 (Regulation 5009) entitled “Prohibited Activities – Gifts,” prohibits public officials and employees from accepting or receiving any gifts of cash, or any goods or services valued at more than twenty-five dollars ($25) from an “interested person.” Recently, in Advisory Opinion 2013-4 the Commission concluded that ProvPort was an “interested person” as to this Petitioner because ProvPort has a direct financial interest in decisions that the Petitioner is authorized to make, or participate in making, as part of his official duties as the Director of Economic Development. Therefore, the Commission opined that the Code of Ethics prohibited the Petitioner from accepting gifts of travel worth more than $25 directly from ProvPort. A.O. 2013-4; Commission Regulation 36-14-5009. Nevertheless, the Commission advised this Petitioner that, given the City’s and ProvPort’s common interests in Port development, the Code of Ethics may allow ProvPort to provide the City with a grant or payment to subsidize the Port-related travel of staff who are independently selected by the City for that purpose. As a result, the Petitioner sought the instant advisory opinion. In the present matter, the facts as represented above do not implicate Regulation 5009 because the Petitioner’s travel expenses would be directly paid by his employer, the City, and not by an “interested person.” ProvPort’s proposed donation is not a gift to an individual official but to the City to be used for the limited purpose of funding travel expenses related to the economic development of the Port, which is mutually beneficial to both the City and ProvPort. After the City accepts this donation, the money becomes City funds to be expended only with the approval of the Mayor, who will independently determine whether it is appropriate for the Petitioner or any other person to travel on the City’s behalf and whether to authorize funds for such travel expenses.[2] For all of these reasons, it is the opinion of the Ethics Commission that the Code of Ethics does not prohibit the City from paying for the Petitioner’s travel expenses relative to the economic development of the Port of Providence with funds donated to the City by ProvPort, for the limited purpose of subsidizing travel expenses related to the economic development of the Port. Code Citations: § 36-14-5(a) § 36-14-5(d) § 36-14-7(a) Commission Regulation 36-14-5009 Related Advisory Opinions: A.O. 2013-4 A.O. 98-20 A.O. 97-20 Keywords: Gifts Travel [1] Pursuant to a 1994 agreement with the City, in which ProvPort purchased the Port from the City for $16.7 million, the City retained the right to purchase the Port back from ProvPort for the sum of $1 after thirty (30) years. Given the City’s repurchase rights, this “sale” of the Port is sometimes characterized as a thirty (30) year lease. ProvPort’s purchase was financed through the sale of bonds backed by the moral obligation of the City to repay bondholders in the event of ProvPort’s default. See A.O. 2013-4. [2] This opinion is strictly limited to the facts herein and it provides no opinion as to whether the Mayor may authorize the payment of Port related travel expenses for himself from the funds donated to the City by ProvPort.