Advisory Opinion No. 2006-26 Advisory Opinion No. 2006-26 Re: Evan H. Matthews QUESTION PRESENTED The petitioner, the Director of Planning & Development for the Quonset Development Corporation, a state employee position, requests an advisory opinion regarding whether he may, within a year of leaving his public employment, enter into a limited liability company to purchase land that is currently managed by the Quonset Development Corporation and owned by the Rhode Island Economic Development Corporation. RESPONSE It is the opinion of the Rhode Island Ethics Commission that the petitioner, the Director of Planning & Development for the Quonset Development Corporation, a state employee position, may within a year of leaving his public employment, purchase land that is managed by the Quonset Development Corporation and is owned by the Rhode Island Economic Development Corporation, provided that 1) he did not participate in Quonset Development Corporation's decision to sell the property and/or establish the proposal, bid or sale specifications; 2) the availability of said property is publicly noticed; 3) there is subsequent public disclosure of all bids or offers considered; (4) the petitioner did not obtain any confidential information relating to said property through his public position; and 5) the petitioner does not represent himself or his limited liability company before the Quonset Development Corporation in connection with the purchase. The petitioner is the Director of Planning & Development for the Quonset Development Corporation (QDC). He states that the QDC is a subsidiary of the Rhode Island Economic Development Corporation (EDC) that regulates the sale and development of land owned by the EDC in the Quonset Business Park located in North Kingstown. As the Director of Planning & Development, the petitioner is generally responsible for coordinating, implementing and supervising activities pertaining to real estate planning and development, and related transactions in the Quonset Business Park. The Director of Planning and Development works under the general direction of the QDC's Chief Operating Officer. The petitioner states that he does not decide which properties are to be sold or leased, but that such decisions are made by the QDC Managing Director and approved by a Board of Directors. He further states that he does not negotiate or establish the pricing of land sales, but that pricing is controlled by QDC's principal real estate broker and approved by the QDC Managing Director. The petitioner represents that all available land at the Quonset Business Park is listed on the QDC website and is available to all interested parties. The terms of any sale or lease must be approved by the QDC Board of Directors at a monthly meeting that is noticed pursuant to the Open Meetings Act. Furthermore, any requests for development proposals are likewise posted on the QDC website and published in the Providence Journal. The petitioner states that he does not participate in the selection of development proposals, but that proposals are evaluated and approved by the Board of Directors. Given all of these representations, the petitioner asks whether he may leave his employment with the QDC and, within a year of such severance, enter into a limited liability company to purchase land that is currently managed by the QDC and owned by the EDC. Under the Code of Ethics, a public official may not have any interest, financial or otherwise, direct or indirect, which is in substantial conflict with the proper discharge of his duties in the public interest. R.I. Gen. Laws § 36-14-5(a). A substantial conflict of interest occurs if a public official has reason to believe or expect that he or any family member or business associate, or any business by which he is employed or represents will derive a direct monetary gain or suffer a direct monetary loss by reason of his official activity. R.I. Gen. Laws § 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, other than that provided by law, for himself, a family member, business associate, or any business by which he is employed or represents. R.I. Gen. Laws § 36-14-5(d). Further, the Code provides that while serving and for a period of one year after he has officially terminated his position with any state or municipal agency, he shall not represent himself or any other person before the state or municipal agency on which he had served. R.I. Gen. Laws §§ 36-14-5(e)(1) and 5(e)(4). Finally, no person subject to the Code or any business associate of said person may enter into a contract with a municipal agency unless “the contract has been awarded through an open and public process, including prior public notice and subsequent public disclosure of all proposals considered and contracts awarded.” R.I. Gen. Laws § 36-14-5(h). These provisions of the Code of Ethics do not bar the petitioner from seeking to purchase land owned by the EDC and managed by the QDC, within a year of his leaving the QDC. As a general rule, public officials may bid on property offered for sale by their own agency, department or municipality provided that the selling entity adheres to the open and public bidding process required by R.I. Gen. Laws § 36-14-5(h). See A.O. 2001-57 (Central Falls City Councilor may submit bid to purchase municipal property, provided 1)he not participate in Council’s decision to sell property or establish bid specifications; 2) sale of property is publicly noticed; 3) he did not obtain confidential information relating to property through his public position; 4) he does not appear before Council; and 5) he recuses from Council’s consideration of matters relating to disposition of property). The Commission has consistently concluded that public officials and employees may not bid on contracts where they have participated in the bid development process. Under the Code, participation in the bid specification process places the public official or employee in a privileged and/or advantageous position with respect to other bidders. See A.O. 98-65 (finding that Town employees who provided substantive input into a decision to put property to tax sale, or as to requirements of the bids, may not bid on the property). Based on all of the above, the Code of Ethics does not prohibit the petitioner, after leaving his employment with the QDC, from purchasing property from the EDC that is managed by the QDC, provided that 1) he did not participate QDC's decision to sell the property and/or establish proposal, bid or sale specifications; 2) the availability of said property is publicly noticed; 3) there is subsequent public disclosure of all bids or offers considered; (4) the petitioner did not obtain any confidential information relating to said property through his public position; and 5) the petitioner does not represent himself or any other entity before the Quonset Development Corporation in connection with the purchase. Please note that this opinion only address the applicability of the Rhode Island Code of Ethics. It does not address whether the petitioner's proposed course of action complies with any other laws, statutes, regulations, ordinances or personnel policies. Code Citations: 36-14-5(a) 36-14-5(d) 36-14-5(e) 36-14-5(h) 36-14-7(a) Related Advisory Opinions: 2001-57 98-65 Keywords: Business interest Contracts