Advisory Opinion No. 2014-5 Rhode Island Ethics Commission Advisory Opinion No. 2014-5 Approved: January 28, 2014 Re: Sean J. McGarry QUESTION PRESENTED: The Petitioner, a former member of the New Shoreham Town Council, a municipal elected position, requests an advisory opinion regarding whether the Code of Ethics prohibits his business, Block Island Recycling Management, from bidding on new contracts through an open and public bidding process for services that it currently performs for the Town of New Shoreham. RESPONSE: It is the opinion of the Rhode Island Ethics Commission that the Petitioner’s business, Block Island Recycling Management, is authorized to bid on new contracts through an open and public bidding process for services that it currently performs for the Town of New Shoreham. This opinion is based upon a finding that the unique circumstances in this matter justify an exception to the Code of Ethics’ Municipal Official Revolving Door Regulation. The Petitioner served on the New Shoreham Town Council (“Town Council”) from December 2012 until his resignation on November 19, 2013. In his private capacity, the Petitioner is a fifty percent (50%) owner of Block Island Recycling Management (“BIRM”), a waste collection and hauling company with its principal place of business in the Town of New Shoreham (“Town”). The Petitioner resigned from his position on the Town Council the day after the issuance of Advisory Opinion 2013-37 by the Ethics Commission. In Advisory Opinion 2013-37, the Commission opined that the Petitioner’s business, BIRM, was prohibited from seeking or accepting any new contracts with the Town for the duration of the Petitioner’s service on the Town Council and for a period of one year after his official date of severance from the Town Council. The Petitioner represents that BIRM currently holds five (5) contracts with the Town for: 1) the operation of the transfer station; 2) tippy can trash collection; 3) container service; 4) hauling materials; and 5) road materials. He informs that BIRM has held all of these contracts for at least ten (10) years. He relates that BIRM derives approximately 50% of its income from its five (5) contracts with the Town. He states that BIRM is the primary source of income for both himself and his business partner. He informs that BIRM has five (5) year-round employees and an additional five (5) seasonal employees in the summer. He represents that upon his election to the Town Council he believed that he would only have to recuse from matters involving BIRM and he was not aware that his public service would prevent BIRM’s future contracting with the Town. He represents that if he had known that his business would be prohibited from bidding on future contracts with the Town, he would not have sought election to the Town Council. The Petitioner informs that on January 8, 2014, the Town posted its annual advertisement for sealed bid proposals for fifteen (15) different service contracts, including four (4) contracts that BIRM currently holds with the Town: tippy can, container service, hauling materials and road materials. The Town has posted the information for each contract on its website, in addition to advertising in the Block Island Times and the Providence Journal, and directly mailing requests for bids to a list of previous contractors. All bids must be received by the Town Manager by 10:00 a.m. on January 31, 2014, at which time all bids will be opened and read aloud. Thereafter, the Town Manager will review the bids and make a recommendation to the Town Council relative to each contract. The Town Council considers each contract at an open meeting and awards the bids. The Petitioner states that he did not participate in any Town Council matters related to BIRM’s contracts during his service on the Town Council. The Petitioner represents that BIRM’s contracts with the Town for tippy can, container service, hauling materials and road materials are set to expire on June 30, 2014. He informs that BIRM would like to submit bid proposals to continue providing these services to the Town. He informs that, in his experience, BIRM has been the only contractor bidding on the tippy can and container service contracts. He further informs that the hauling materials and road materials contracts have had one other contractor bid on them in the past. Cognizant of the Code of Ethics’ revolving door restrictions, the Petitioner seeks permission for his business, BIRM, to bid on new contracts for services that it currently performs for the Town. He advises that the all of the contracts will be bid on through an open and public process. Commission Regulation 36-14-5014 (“Regulation 5014”), entitled “Municipal Official Revolving Door,” generally prohibits a municipal elected official from leaving elective office in a city or town and then, within one year, obtaining employment in that same city or town. The provision reads as follows: (a) No municipal elected official or municipal school committee member, whether elected or appointed, while holding office and for a period of one (1) year after leaving municipal office, shall seek or accept employment with any municipal agency in the municipality in which the official serves, other than employment which was held at the time of the official’s election or appointment to office or at the time of enactment of this regulation, except as provided herein. (1) 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 any municipality or municipal agency, whether as an individual or a principal of an entity performing such service. (2) For purposes of this regulation, “municipal agency” shall include any department, division, agency, commission, board, office, bureau, authority, quasi-public authority, or school, fire or water district and any other agency that is in any branch of municipal government and exercises governmental functions other than in an advisory nature. (b) Nothing contained herein shall prohibit a municipal elected official or municipal school committee member, whether elected or appointed, from seeking or being elected to any elective office. (c) The Rhode Island Ethics Commission may authorize exceptions to this regulation where such exceptions would not create an appearance of impropriety. In Advisory Opinion 2013-37, the Commission found that BIRM’s contracts with the Town constituted “employment” as that term is defined in Regulation 5014 because the Petitioner is a principal of BIRM, an entity that is providing independent contractor services to the Town. The Commission further found that under the circumstances presented, the act of bidding on a new contract, even for services that were previously provided to the Town under an expired contract, would constitute “seeking or accepting” new employment within the municipality in which the Petitioner served and, thus, would be prohibited by Regulation 5014 until November 19, 2014, unless the Ethics Commission granted an exception. The Petitioner has come before the Commission asking for an exception to Regulation 5014’s revolving door restrictions. After considering the Petitioner’s above representations and his adherence to the advice set forth in Advisory Opinion 2013-37, we believe that the unique circumstances herein justify the application of the exception found in Regulation 5014(c). In particular, we note that BIRM is the Petitioner’s primary source of income, he would not have sought election to the Town Council if he had anticipated this problem, he immediately resigned when he learned of this conflict, and BIRM would be bidding on contracts for services that it has been providing to the Town for at least ten (10) years. Under these circumstances, we find that an exception to the revolving door regulation is reasonable and appropriate. Accordingly, the Ethics Commission authorizes the Petitioner’s business, BIRM, to bid on new contracts for services that it currently performs for the Town of New Shoreham through an open and public bidding process, in accordance with subsection (c)’s exception to Regulation 5014. Code Citations: Commission Regulation 36-14-5014 Related Advisory Opinions: A.O. 2013-37 A.O. 2013-36 A.O. 2013-27 Keywords: Private Employment Revolving Door This Advisory Opinion is strictly limited to the facts stated herein and relates only to the application of the Rhode Island Code of Ethics. Under the Code of Ethics, advisory opinions are based on the representations made by, or on behalf of, a public official or employee and are not adversarial or investigative proceedings. Finally, this Commission offers no opinion on the effect that any other statute, regulation, ordinance, constitutional provision, charter provision, or canon of professional ethics may have on this situation.