Advisory Opinion No. 2021-48

Rhode Island Ethics Commission

Advisory Opinion No. 2021-48

Approved: June 29, 2021

Re: David J. DeCost, Jr.

QUESTION PRESENTED:

The Petitioner, a principal civil engineer for the Rhode Island Department of Environmental Management’s Division of Planning and Development, a state employee position, who in his private capacity owns and operates an apple cider orchard, requests an advisory opinion regarding whether he is prohibited by the Code of Ethics from applying for a Local Agriculture and Seafood Act Grant advertised by the Rhode Island Department of Environmental Management’s Division of Agriculture and, if so, whether he qualifies for a hardship exception to the Code of Ethics’ prohibition against representing himself before the state agency by which he is currently employed for purposes of seeking the grant.

RESPONSE:

It is the opinion of the Ethics Commission that the Petitioner, a principal civil engineer for the Rhode Island Department of Environmental Management’s Division of Planning and Development, a state employee position, who in his private capacity owns and operates an apple cider orchard, qualifies for a hardship exception to the Code of Ethics’ prohibition against representing himself before the state agency by which he is currently employed for purposes of seeking a Local Agriculture and Seafood Act Grant administered by his agency’s Division of Agriculture.

The Petitioner is currently employed as a principal civil engineer in the Division of Planning and Development (“Division of P&D”) at the Rhode Island Department of Environmental Management (“DEM”) and has been so employed for the last five years.  He cites among the accomplishments of the Division of P&D the design and construction of award winning State Park & Management Area Facilities including boat ramps, beach pavilions, bike paths, and more.  The Petitioner explains that, in his capacity as a principal civil engineer, he assists with the completion of capital improvement projects which may include infrastructure upgrades, renovations to older buildings, new construction, and site improvements and that his duties also include the permitting and design processes and management of construction efforts.

The Petitioner states that, in his private capacity, he has owned and operated an apple cider orchard located in Glocester, Rhode Island, not far from his home, for the past eighteen months.  He further states that he would like to apply for a Local Agriculture and Seafood Act Grant (“LASA Grant”) to fund the purchase of some apple processing equipment.  He explains that, although the LASA

Grant is advertised and administered by the DEM’s Division of Agriculture, he actually learned about the LASA Grant from another local farmer.  The Petitioner informs that the Division of P&D and the Division of Agriculture are two separate offices within the DEM and that neither he nor the Division of P&D had any involvement in the creation of the LASA Grant application or its advertisement and, likewise, will have no involvement in the scoring of the applications or awarding of any LASA Grants.  The Petitioner referred Ethics Commission Staff to the DEM website on which the LASA Grant is advertised (“the website”)[1] and to DEM employee Ananda Fraser (“Ms. Fraser”), Chief of Program Development within the Division of Agriculture, to obtain more information about the LASA Grants Program.

According to the website, the LASA Grants Program was established by the Local Agriculture and Seafood Act (LASA) of 2012, and its goal is “to support the growth, development, and marketing of local food and seafood in Rhode Island.”  Ms. Fraser states that the DEM’s Division of Agriculture will award between $160,000 and $240,000 in the current grant round and that the maximum grant award available to any farmer, individual, business, or non-profit organization is $20,000.  Ms. Fraser further states that all applicants must be based in Rhode Island and that, while the application does not inquire of an applicant’s employment status, that information could be disclosed by an applicant in an answer to a particular question or within an answer to an essay question contained in the application.  The Petitioner represents that he did not disclose his full-time employment as a principal civil engineer in the DEM’s Division of P&D on his LASA Grant application. This year’s application deadline was extended from May 30th to June 13th, and the awards are expected to be announced in June of 2021.[2]

Ms. Fraser represents that the LASA Grant applications will be evaluated by the LASA Grants Program Advisory Committee (“Advisory Committee”), after which the Advisory Committee will forward its recommendations for grant recipients to the DEM Director (“Director”) for approval.  She explains that the Advisory Committee is composed of nine members and is chaired by the Chief of the DEM’s Division of Agriculture (“Chair”), who is the only non-voting member of the Advisory Committee.  Ms. Fraser states that the other eight members, all of whom were appointed by the Director, and none of whom are employed by the DEM, represent agencies, organizations, and individuals that have a role or interest in the planning, development, and support of viable agriculture and seafood sectors and a locally-based sustainable food system.  Because the Chair is a non-voting member of the Advisory Committee, he will not participate in the selection of applicants to recommend as  LASA Grant recipients.  Ms. Fraser represents that requiring the Chair to refrain from participation in the recommending of grant recipients is intended to keep the DEM impartial, given the Chair’s familiarity with certain applicants and/or their projects because of the Division of Agriculture’s regulatory role with aspects of agriculture by which certain applicants and grant recipients are bound.  She further represents that the appointment of eight voting members of the Advisory Committee who are not DEM employees is also intentional, the goal being to seat the Advisory Committee with a wide swath of agricultural stakeholders. 

Prior to this year, the DEM had contracted with the Rhode Island Food Policy Council, a local non-profit organization, to organize and administer the LASA Grants Program on behalf of the DEM.  This year, the DEM has assumed responsibility for the administration of the LASA Grants Program.  Ms. Fraser explains that the change will allow the DEM to increase the pool of grant funds to be made available to applicants by approximately $20,000 (the fee previously paid to the Food Policy Council) and allow the DEM to monitor the use of the funds awarded to grant recipients more closely.  Ms. Fraser states that the percentage of grant applicants who are awarded grants fluctuates annually depending upon the number and quality of applications received.[3]  Ms. Fraser reports that, while the Director makes the final decision on who will receive a LASA Grant, the Director has always gone with the recommendations of the Advisory Committee.  She explains that the Director might ask questions of the Advisory Committee or seek additional information about a particular applicant, but that the Director trusts the process and adopts the recommendations of the Advisory Committee.

Ms. Fraser states that, beginning this year, LASA Grant recipients will be paid 50% of their total award amount upon receipt by the DEM of the executed grant agreement and related documents and receive the second 50% of their total award amount after completion of their project when a final report, claim, and invoice have been submitted and approved by the DEM’s Division of Agriculture.  Each grant recipient must authorize the DEM to monitor his or her project, which may be up to 24 months in length.  Discretion will be exercised by the DEM employee monitoring the work of each grant recipient when determining whether the grant is being used in conformance with the methods stated in the grant application, be it through on-site visits or the review of interim and final reports submitted by the grantees.  Ms. Fraser represents that, while there are other grant opportunities available to area farmers, none match the amounts awarded and flexibility of use offered by the LASA Grants.  It is in the context of these representations that the Petitioner seeks guidance from the Ethics Commission regarding whether he is prohibited by the Code of Ethics from applying for a LASA Grant and, if so, whether he qualifies for a hardship exception to the Code of Ethics’ prohibition against representing himself before the DEM for purposes of seeking the grant.

The Code of Ethics prohibits a public employee from representing himself or any other person before any state agency by which he is employed.  R.I. Gen. Laws § 36-14-5(e)(1) & (2) (“section 5(e)”).  This prohibition extends for a period of one year after the public employee has officially severed his position with the agency.  Section 5(e)(4).  The “revolving door” language of section 5(e) is designed to both prevent any undue influence that a current employee may have over his agency and colleagues by reason of his employment there, and to minimize any undue influence that a former employee may have over his former agency and colleagues by reason of his past employment there.  Under the Code of Ethics, a person represents himself or another person before a state agency if he participates in the presentation of evidence or arguments before that agency for the purpose of influencing the judgment of the agency in his own favor or in favor of another person.  Section 36-14-2(12) and (13); Commission Regulation 520-RICR-00-00-1.1.4 Representing Oneself or Others, Defined (36-14-5016).  Section 5(e)’s prohibitions are stricter than virtually any other provisions in the Code of Ethics.  In most instances under the Code of Ethics, public officials and employees may address potential conflicts of interest by declining to participate in related discussions and votes.  Such is not the case with section 5(e).  Absent an express finding by the Ethics Commission that a hardship exists, the prohibitions in section 5(e) are absolute. 

Section 5(e) Applies to Entire Agency

In Advisory Opinion 2020-7, the Ethics Commission opined that the Chief Civil Engineer of the Transportation Planning Division of the Rhode Island Department of Transportation (“DOT”) was prohibited by the Code of Ethics from preparing plans to be submitted by a private client to the DOT, including any separate divisions thereof or entities therein, while he was employed by the DOT and for a period of one year thereafter.  Such was not always the case.  More than twenty years earlier, the Ethics Commission opined that section 5(e)’s prohibitions could apply to either the entire agency by which an individual was employed or, more narrowly, to only the specific department by which he or she was employed or with which he or she had contact, based upon factors that included the agency’s size, the nature of working relationships of separate departments within the agency, and a particular individual’s responsibilities within the agency.  See, e.g., A.O. 97-46 (opining that a DEM engineer working in the Office of Waste Management could submit material for approval to the DEM’s Office of Water Resources and Office of Compliance and Inspection as a private engineer).

However, in Advisory Opinion 2003-51, the Ethics Commission affirmed that, notwithstanding the issuance of prior advisory opinions interpreting section 5(e) more narrowly,  no person subject to the Code of Ethics shall represent himself or herself or 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 and that this prohibition is absolute and applies to the entire agency, including all of its offices, sections, programs or divisions. Therefore, the Petitioner’s statement that the Division of P&D to which he is assigned and the Division of Agriculture which administers the LASA Grants are two separate offices within the DEM will not factor into the Ethics Commission’s determination as to the applicability of section 5(e).

The Submission of Grant Applications is Representation Before One’s Own Agency

Historically, the Ethics Commission has consistently recognized the submission of grant applications by a public official as the representation of that public official before his or her own state agency.  See A.O. 2020-32 (opining that a former Senior Projects Review Coordinator for the Rhode Island Historical Preservation & Heritage Commission (“RIHPHC”) was prohibited from, among other things, submitting a grant application to the RIHPHC from the petitioner’s new private employer on which the petitioner’s name appeared); A.O. 2016-23 (opining that Pawtucket’s Assistant City Solicitor, who was also President of the Board of Directors of Cape Verdean American Community Development (“CACD”), was prohibited from representing the CACD before the City of Pawtucket on any matter, including Block Grant applications, and from signing and submitting such applications); A.O. 2002-59 (opining that a former Rhode Island State Council on the Arts (“RISCA”) member could not apply for a grant from the RISCA, given that she would have to appear before her former board prior to the expiration of one year following her resignation).[4]

Given the advisory opinions issued herein which recognize a public official’s application for grant funding as an appearance before one’s own agency, the Petitioner’s proposed conduct falls within the Code of Ethics’ prohibition against representing oneself before a state agency by which he is currently employed.  Having determined that section 5(e)’s prohibitions apply to the Petitioner, the Ethics Commission will consider whether the unique circumstances represented by the Petitioner herein justify a finding of hardship to permit him to apply for a LASA Grant.

The Hardship Exception

Section 5(e)(1) specifically authorizes the Ethics Commission to grant exceptions, in certain circumstances, to allow a public official to represent himself before his own agency, based upon a finding that a denial of such self-representation would result in a hardship.  Upon receiving a hardship exception, the public official is required to recuse from participating in his agency’s consideration and disposition of the matter at issue.  Section 36-14-5(e)(1)(ii).  The public official must also “follow any other recommendations that the Ethics Commission may make to avoid any appearance of impropriety in the matter.”  Section 36-14-5(e)(1)(iii).  See, e.g., A.O. 2014-4 (granting a hardship exception to a member of the Portsmouth Town Council and permitting him to represent himself before the Portsmouth Zoning Board in order to seek a variance for his personal residence, provided that, in order to avoid any appearance of impropriety, he recused from the Town Council’s appointment or reappointment of any person to the Zoning Board until after the election cycle following the resolution of his applications for zoning relief).

The Ethics Commission reviews questions of hardship on a case-by-case basis and has, in the past, considered some of the following factors in cases involving real property: whether the subject property involved the official’s principal residence or principal place of business; whether the official’s interest in the property was pre-existing to his public office or was recently acquired; whether the relief sought involved a new commercial venture or an existing business; and whether the matter involved a significant economic impact.  The Ethics Commission may consider other factors and no single factor is determinative.

Before reviewing the question of hardship in the Petitioner’s case, it is worth noting that there have been several instances where the Ethics Commission allowed a petitioner to appear before his or her own agency, or former agency, without invoking the hardship exception.  See A.O. 2002-42 (opining that a Central Falls Housing Authority employee could participate in the City’s Section 8 subsidized housing program as a landlord property owner but was required to recuse from participation in any Housing Authority matters involving his own property).  In Advisory Opinion 2016-38, the Deputy Chief of Legal Services for the Rhode Island Department of Business Regulation (“DBR”), who also served as legal counsel to the Rhode Island Board of Real Estate Appraisers (“Board”), was allowed to complete her real estate appraiser pre-licensing education and obtain a real estate appraiser license from the DBR.  There, the petitioner stated that in her capacity as legal counsel to the DBR and to the Board she did not participate in any way in the decision-making relative to approval or disapproval of a real estate appraiser application and that the standards and required qualifications for trainee and licensed real estate appraisers were federally mandated.  Moreover, the examination required to upgrade from a trainee to a licensed appraiser was administered and graded by an independent online testing company and the results forwarded to the DBR, negating the risk of favoritism to the petitioner by DBR or the Board. 

There have also been instances where the Ethics Commission has allowed public officials to seek loan funds from the state agencies by which they were employed, deeming the applications as ministerial in nature.  See, e.g., A.O. 98-22 (opining that a Providence Plan Housing Corporation employee could submit an application for HOME funds to the PPHC, given that it was a ministerial act and she did not possess discretionary authority regarding the HOME funding program in her employment with the PPHC, nor was she in any way involved with the application or approval process for the HOME program).

Still, dating back even further, the Ethics Commission allowed public employees to petition their public employers for licenses, loans, and programs in instances where those employees were not involved in the decision-making process and provided that they did not use their positions to influence the status of their applications.  See A.O. 95-76 (opining that an employee of the Rhode Island Department of Substance Abuse (“DSA”), who was responsible for monitoring a federal grant funded by the Center for Substance Abuse Prevention, was not prohibited by the Code of Ethics from petitioning the DSA for a license to open an out-patient substance abuse facility because the employee did not participate in the decision-making process concerning whether to issue the license and used neither his position with the DSA nor confidential information received through his position to benefit his business venture); A.O. 95-105 (opining that employees of the Historical Preservation & Heritage Commission could apply for loans made available through that agency, provided that said employees did not use their official positions or confidential information obtained through those positions to influence their selection for the loans and, further provided that they notified the HPHC, in writing, of the nature of their interest in the matter and refrained from participation in said matter[5]); A.O. 90-55 (opining that an employee of the Department of Transportation was allowed to apply to a program operated and administered by his employer provided that the petitioner did not use his official position to influence the status of his application).

Here, the Petitioner’s ownership of the apple orchard does not involve his principal residence, his principal place of business, or predate the start of his employment at the DEM, and the relief sought more closely resembles a new commercial venture than a personal undertaking.  However, the Ethics Commission is not limited to contemplation of only those factors routinely considered when weighing the award of a hardship exception, but may consider other factors, as well.  In this case, additional factors worthy of consideration include the Petitioner’s representation that he had no role in the development of the LASA Grant, has no role in the evaluation of the applications and the selection of grantees, and that the grant program is administered by an entirely different division outside of his chain of command or responsibilities.  The fact that the Advisory Committee is purposely composed of voting members who are not employees of the DEM further distances the Petitioner from section 5(e)’s design  to prevent any undue influence that a current employee may have over his agency and colleagues by reason of his employment there.  This year, the DEM has elected to monitor the use of grant funds awarded to grant recipients more closely than in years past before distributing the second 50% of a grant award to a recipient.  Under such circumstances, in the event that the Petitioner is among those selected by the Advisory Committee to receive a grant, it is highly unlikely that he would be situated to use or attempt to use his position to influence the determination by a DEM employee of whether the Petitioner’s grant award is being used in conformance with the methods stated in his application, a determination which is arguably ministerial, given the Petitioner’s having specifically identified his intended use of the grant award to purchase apple processing equipment.  Further, the LASA Grant award, which could be up to $20,000 for the Petitioner, is significant and, reportedly, while there are other grant opportunities available to area farmers, none match the amounts awarded and flexibility of use offered by the LASA Grants.

Conclusion

Consistent with the advisory opinions cited herein, the Ethics Commission deems the submission of a LASA Grant application by the Petitioner to be self-representation before the DEM, which is prohibited by section 5(e).  However, the extenuating circumstances presented by the Petitioner under which he seeks a hardship exception have merit.  Such circumstances include the absence of both the Petitioner’s involvement and that of the Division of Planning and Development with the LASA Grants Program, and that the voting members of the Advisory Committee are not DEM employees. That the DEM has elected to monitor the award of the second 50% of grant funds to recipients more closely this year does not lend itself to an ability on the part of the Petitioner to exercise any undue influence over the DEM by reason of his employment there.  Accordingly, based upon the very specific facts as represented herein, it is the opinion of the Ethics Commission that the Petitioner qualifies for a hardship exception to the Code of Ethics’ prohibition against representing himself before the state agency by which he is currently employed for purposes of seeking a LASA Grant, provided that he does not use or attempt to use his official position to influence the monitoring by a DEM employee of the use of any grant award the Petitioner might receive.

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(12) 
§ 36-14-2(13) 
§ 36-14-5(e)   
520-RICR-00-00-1.1.4 Representing Oneself or Others, Defined (36-14-5016)      

Related Advisory Opinions:  
A.O. 2020-32 
A.O. 2020-7   
A.O. 2016-38 
A.O. 2016-23 
A.O. 2014-4   
A.O. 2003-51 
A.O. 2002-59 
A.O. 2002-42 
A.O. 98-22     
A.O. 97-46     
A.O. 95-105   
A.O. 95-76     
A.O. 90-55                 

Keywords:     
Grants            
Hardship Exception   
Revolving Door                     

[1] http://www.dem.ri.gov/programs/agriculture/grants-lasa.php (last accessed June 18, 2021).          
[2] The Petitioner’s request for this advisory opinion was received by the Ethics Commission on May 26, 2021.  Because it was not feasible to provide the Petitioner with an advisory opinion prior to June 13, 2021, the Petitioner was advised by Ethics Commission Staff that he would not be prohibited from applying for the LASA Grant on the condition that, if the Ethics Commission ultimately issues an advisory opinion deeming him ineligible to apply for and receive a LASA Grant, he will either withdraw his application or, if he has been awarded a LASA Grant before the Ethics Commission considers his request, will condition his acceptance of the LASA Grant on the issuance of a formal advisory opinion from the Ethics Commission that applying for and accepting the LASA Grant does not violate the Code of Ethics.  The Petitioner agreed to these conditions. 
[3]Ms. Fraser states that the DEM currently has no policy in place making DEM employees ineligible to apply for LASA Grants.  She adds that, in the past, DEM employees have applied for and received LASA Grants when the Rhode Island Food Policy Council had been hired by the DEM to run the LASA Grants Program.
[4] In the cases of Advisory Opinions 2020-32, 2016-23, and 2002-59, each of the petitioners had either been, or could potentially have been, tasked with reviewing grant applications as part of the performance of their duties for each of their respective agencies.
[5] The Ethics Commission did conclude, however, that the Code of Ethics barred the HPHC Commissioners from applying to the loan program, based on the fact that Commissioners of that agency played a vital discretionary role in the loan application process; served on the Loan Committee, made recommendations concerning applications; and voted to provide the final approval of each loan application.