Advisory Opinion No. 2001-7

Re: Nicholas Castagna

QUESTION PRESENTED

The Westerly Town Solicitor requests an advisory opinion on behalf of the petitioner, a Westerly Town Councilor, a municipal elected position, as to whether he must recuse himself from participating and/or voting on Council matters involving customers of his haircutting business.

RESPONSE

It is the opinion of the Rhode Island Ethics Commission that the Code of Ethics does not prohibit the petitioner, a Westerly Town Councilor, a municipal elected position, from participating and/or voting on Council matters involving customers of his haircutting business since his relationship with such individuals is not a business association that would trigger the prohibitions set forth in R.I. Gen. Laws §§ 36-14-5(a) and 7(a).

Under the Code of Ethics, the petitioner, as a member of the Westerly Town Council, 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 in the public interest. See R.I. Gen. Laws §§ 36-14-5(a), 36-14-7(a). An official will have an interest in substantial conflict with his official duties if it is likely that a "direct monetary gain" or a "direct monetary loss" will accrue, by virtue of the public official's activity, to the official, a family member, a business associate, an employer, or any business which the public official represents. See R.I. Gen. Laws § 36-14-7(a). Business associates are defined as individualsor entities joined together to "achieve a common financial objective." R.I. Gen. Laws § 36-14-2(3).

The petitioner seeks guidance as to whether he may participate and/or vote in Council matters involving customers of his local business, known as “Ray’s Haircutting”. He advises that he has owned and/or been employed by this business for approximately twenty years and has numerous established customers, many of whom have been regular customers for several years. He indicates that these customers spend less than $500.00 per year at his establishment.

After considering the relevant provisions of the Code of Ethics, the Commission concludes that the petitioner may participate in the Town Council's consideration of matters involving his customers. Here, the petitioner does not have contracts or specific business relationships with any of the potential interested individuals; he merely provides haircutting services to his customers in the ordinary course of business. Further, there is no evidence that his business would be financially affected by the Council's decisions on matters involving his customers. Absent some direct and ongoing financial relationship, the normal commercial dealings between the petitioner and his customers do not rise to the level of business association as defined in R.I. Gen. Laws § 36-14-2(3). See A.O. 99-21 (finding that a Westerly Town Councilor may participate in the review and/or award of a contract, despite the fact that companies that purchase parts from his automobile parts store may respond to the RFP, since his relationship with such companies is not a business association); A.O. 93-21 (concluding that a West Warwick Town Councilor who is a regular customer of a restaurant could participate in the review of an application for a twenty-four hour victualling license for that restaurant absent a significant financial nexus). Compare A.O. 97-103 (concluding that a Westerly Town Councilor's close and dependent business relationship with a loan officer who had been vocal about an issue together with the financial impact that such an ordinance may have on the loan officer would result in a substantial conflict with his duties as a member of the Town Council); A.O. 96-6 (opining that a Westerly Town Councilor could participate in matters involving customers of his bank unless there was some direct or current involvement between the Councilor and the bank customer, the participation of the Councilor in a decision of the bank that directly affects the customer, or the involvement of a customer who substantially impacts the economic fortunes of the bank); A.O. 93-21 (concluding that a West Warwick Town Councilor who supplied food to a local restaurant that applied for a twenty-four hour victualling license should not participate in the review of the application since he would be directly financially affected by the decision). Accordingly, since there is no direct financial nexus between the petitioner and potential Council actions involving his customers, he does not have an interest that would prohibit his participation in the Council’s consideration of matters involving his customers, whether in their individual or professional capacities.

Code Citations:

36-14-2(3)

36-14-5(a)

36-14-7(a)

Related Advisory Opinions:

99-21

97-103

96-6

93-21

Keywords:

Business associate

Business interest

Financial interest