Advisory Opinion No. 2016-2 Rhode Island Ethics Commission Advisory Opinion No. 2016-2 Approved: January 12, 2016 Re: David Salvatore QUESTION PRESENTED: The Petitioner, a member of the Providence City Council, a municipal elected position, who until recently was also a Policy Analyst for the Rhode Island House of Representatives, a state employee position, requests an advisory opinion regarding the application of the Code of Ethics in light of his new private employment as the Director of Government Affairs for the Rhode Island Association of Realtors. RESPONSE: It is the opinion of the Rhode Island Ethics Commission that the Petitioner, a member of the Providence City Council, a municipal elected position, who until recently was also a Policy Analyst for the Rhode Island House of Representatives, a state employee position, may not represent his new employer, the Rhode Island Association of Realtors, before the General Assembly or the City of Providence until the expiration of one year from his severance from each public office. Additionally, the Petitioner must recuse from any Providence City Council matters that involve or financially impact his employer, the Association, and he may be required to recuse from some City Council matters that involve or financially impact certain members of the Association. The Petitioner has been a member of the Providence City Council (“City Council”) since being initially elected in 2010. He was reelected to a second four-year term in 2014. Beginning in 2013, the Petitioner was a full-time employee of the Rhode Island General Assembly’s Joint Committee on Legislative Services, serving as a Policy Analyst for the House of Representatives. He left that position on November 24, 2015, to accept a new position as the Director of Government Affairs for the Rhode Island Association of Realtors (“the Association”). The Petitioner represents that the Association is a membership organization for the approximately 4,000 real estate brokers, salespeople and appraisers who work in Rhode Island. The Petitioner notes that the Association is affiliated with five regional associations.[1] The mission and purpose of the Association is to monitor and promote issues that affect the Association’s members, private property rights and the real estate industry on both state and municipal levels. To accomplish its objectives, the Association engages in advocacy and lobbying of state and municipal executive and legislative bodies, including both chambers of the General Assembly. Revolving Door – Section 36-14-5(e) As the Association’s Director of Government Affairs, the Petitioner’s duties would normally include representing the Association as a lobbyist before various state and local governmental entities including the General Assembly, the Office of the Governor, the Rhode Island Housing Corporation, other state agencies, boards, commissions and quasi-public state entities, as well as municipal bodies and entities including city/town councils. While the Petitioner states that he is cognizant of the Code of Ethics’ revolving door provision which prohibits him from lobbying the General Assembly for a period of one year from his date of severance, or from lobbying any City of Providence agencies or departments given his current service on the City Council, he asks whether the Code prohibits him from lobbying or presenting the Association before other state or municipal entities. The Code of Ethics contains several “post-employment” and “revolving door” provisions that apply to current and former public officials in various circumstances. The instant request for an advisory opinion involves the application of section 36-14-5(e) of the Code, which provides that “[n]o person subject to the Code of Ethics shall . . . represent any other person before any state or municipal agency of which he or she is a member or by which he or she is employed . . . for a period of one year after he or she has officially severed his or her position with said state or municipal agency[.]” R.I. Gen. Laws § 36-14-5(e)(2), (4). In previous advisory opinions the Commission has applied section 36-14-5(e) to members and employees of the General Assembly. For example, in Advisory Opinion 2004-4, the former Special Assistant to the House Majority Leader of the House of Representatives sought advice as to whether, upon leaving his public employment, he could represent private businesses as a lobbyist before the Rhode Island Senate and certain executive branch agencies. Applying section 36-14-5(e) of the Code, the Commission opined that although the Petitioner would be permitted to lobby the executive branch immediately upon his severance from his position with the Majority Leader, he was required to wait one year prior to lobbying either chamber of the General Assembly. Similarly, in Advisory Opinion 2003-2 the Commission opined that a State Representative who was privately employed by the American Lung Association was prohibited by section 36-14-5(e) from lobbying or otherwise representing his employer before either chamber of the General Assembly. The Commission has also applied section 36-14-5(e)’s post-employment lobbying restrictions to persons serving in other branches of Rhode Island government. See, e.g., A.O. 2006-56 (Chief of Staff/Legislative Director for the Office of the Attorney General may engage in lobbying of the General Assembly and federal, state and municipal governmental agencies upon severing his employment with the Attorney General, but shall not engage in lobbying the Office of Attorney General for a period of one year); A.O. 2005-6 (former Legislative Director for the Governor may engage in lobbying of the General Assembly as well as state and municipal agencies other than the Office of the Governor); A.O. 2003-56 (former Director of Legislative and Governmental Affairs in the Office of the Lieutenant Governor may lobby the General Assembly and other state agencies in his new private employment, but shall not lobby the Office of the Lieutenant Governor for one year after leaving his employment there); A.O. 2003-32 (former Director of Administrative Records in the Office of the Secretary of State may lobby the General Assembly and other state agencies in his private employment, but shall not lobby the Office of the Secretary of State). In the instant matter, the Petitioner states that he is aware that the Code of Ethics prohibits him from lobbying or otherwise representing the Association before the entire General Assembly until a full year has passed from his severance of employment there. Provided he abides by that prohibition, the Code of Ethics does not prohibit him from lobbying other state or quasi-public agencies that do not fall under the legislative branch of government including, in particular, the Office of the Governor and the Rhode Island Housing Corporation. The Petitioner further advises that he is aware that he may not represent the Association before any agency or division of the City of Providence while he continues to serve on the City Council and for a year thereafter. Notwithstanding this restriction, the Petitioner is free to represent the Association’s interests before other municipalities. City Council - Conflicts of Interest and Recusal The Petitioner poses a second question relating to potential conflicts of interest that may arise while carrying out his duties as a member of the Providence City Council, given his new employment with the Association and the various interests of the Association’s members in decisions that are made by the City Council and other Providence agencies. The Petitioner states that some of the Association’s members have personal and/or professional financial interests in the policies, agreements and ordinances adopted by the City of Providence. The Petitioner asks whether he is required to recuse from participation in any of the following situations in which the Association’s members are most likely to be involved. First, the Petitioner states that the City budget, which is debated and adopted each year by the City Council, includes the tax levy on real estate and other property, and it is common for individual realtors, salespeople and appraisers to testify in person or through submission of written comments at budget hearings. Second, he states that tax stabilization agreements between the City and developers with regard to individual properties are approved by the City Council and, occasionally, a real estate broker, salesperson or appraiser may have a role in facilitating a transaction that is related to (or dependent upon) a tax stabilization agreement. Finally, he states that certain changes to the zoning ordinance require City Council approval, such as changes to classifications of property, which may involve a single property, a zoning district, or be city-wide. Under the Code of Ethics, a public official must recuse himself from participation when his business associate or employer, or a person authorized by his business associate or employer, appears or presents evidence or arguments before his state or municipal agency. Commission Regulation 36-14-5002(a)(2) (“Regulation 5002”); section 36-14-5(f). The Code of Ethics also prohibits a public official from using his public office or confidential information received through his public office to obtain financial gain for himself, his family, his business associate, or any business by which he is employed or which he represents. Section 36-14-5(d). Additionally, a public official may not participate in any matter in which he has an interest, financial or otherwise, that is in substantial conflict with the proper discharge of his 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 he, any person within his family, a business associate or an employer will derive a direct monetary gain or suffer a direct monetary loss by reason of his 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). The Ethics Commission considered a somewhat analogous situation in Advisory Opinion 2003-5, in which a member of the Westerly Town Council, who was also the Executive Director of the Misquamicut Business Association (“MBA”), sought advice as to whether he could participate in Town Council matters involving or financially impacting the MBA or any of its 180 members. The Commission first noted that the petitioner, as a business associate of the MBA, was prohibited by the Code from participating in any Town Council matters that either involved or financially impacted the MBA as an independent entity. Notwithstanding this finding, however, the Commission went on to opine that because the petitioner was not himself a business associate of each individual member of the MBA, he was not barred from participating in Town Council matters that involved or impacted individual members of the MBA. Nearly ten years later, the Commission issued another advisory opinion to this same petitioner on a similar question presented. In Advisory Opinion 2012-13, this same member of the Westerly Town Council asked whether he could participate in the Town Council’s consideration of a resolution to fund a sewer expansion to the Misquamicut Beach area, given his continued employment by the MBA and the fact that 90% of the businesses affected by the sewer expansion were MBA members, including three (3) businesses that were owned by members of the MBA’s Board of Directors (the Petitioner’s hiring authority). Given the clear financial impact of the sewer expansion on area businesses, and the fact that three (3) of the MBA’s Board members owned such businesses, the Commission advised the petitioner to recuse from the Council’s deliberations and decision-making. Applying the reasoning of these two prior advisory opinions to the instant question presented, we are able to offer some general guidance to the Petitioner.[2] First, the Code requires the Petitioner to recuse from any City Council matters that either involve or financially impact the Association itself. For example, the Petitioner would be required to recuse from an application by the Association to enter into a tax stabilization agreement for real estate that it owned. Second, the Petitioner is not required to recuse from City Council matters in which an individual member of the Association, as opposed to the Association itself, appears to testify or has a financial interest. However, as was the case in Advisory Opinion 2012-13, there may be situations where multiple Association members are impacted, and/or members who have leadership positions within the Association and/or particular hiring authority over the Petitioner are impacted. In such cases, the Petitioner should either recuse from participation or seek additional guidance from the Ethics Commission. In summary, it is the opinion of the Ethics Commission that the Petitioner is prohibited by the Code of Ethics from representing his new employer, the Rhode Island Association of Realtors, before the General Assembly or the City of Providence until the expiration of one year from his severance from each public office. Additionally, the Petitioner must recuse from any Providence City Council matters that involve or financially impact his employer, the Association, and he may be required to recuse from some City Council matters that involve or financially impact certain members of the Association. 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. Code Citations: § 36-14-2(3) § 36-14-2(7) § 36-14-5(a) § 36-14-5(d) § 36-14-5(e) § 36-14-5(f) § 36-14-6 § 36-14-7(a) Regulation 36-14-5002 Related Advisory Opinions: A.O. 2012-13 A.O. 2006-56 A.O. 2005-6 A.O. 2004-4 A.O. 2003-56 A.O. 2003-32 A.O. 2003-5 A.O. 2003-2 Keywords: Lobbying Post-Employment Private Employment Revolving Door