Advisory Opinion No. 95-94

Re: The Honorable Charles E. McDevitt

A. QUESTION PRESENTED

Whether a State Representative, simultaneously employed by a retail store located in the City of Cumberland, may participate and vote on matters relating to the construction of the Providence Place Mall retail complex.

B. SUMMARY

It is the opinion of the Rhode Island Ethics Commission that a State Representative, who is employed by a retail store located in the City of Cumberland, may participate and vote on matters relating to the construction of the Providence Place Mall retail complex. The Commission bases its finding on previous holdings, including General Commission Advisory Opinion No. 13, which have allowed legislators to participate and vote on matters related to their private employment unless the legislation in question would result in a direct and specific financial benefit to the legislator, his or her spouse, employer, or business associate. In addition, a legislator is protected by Ethics Code provision R.I. Gen. Laws § 36-14-7(b) ("the 7(b) exception") when the benefit to such official is no greater than to any similarly situated member of the official's (his or her spouse's, employer's or business associate's) business, profession or occupation.

C. DISCUSSION

1. Facts

Charles E. McDevitt, a State Representative also employed by the Ann & Hope retail store located in Cumberland, Rhode Island, requests guidance as to whether he may participate and vote on matters related to the construction of the Providence Place Mall retail complex. The petitioner advises that he is the Assistant Department Manager in the Consumer Electronics Department, that he is paid on an hourly basis, and that his responsibilities involve managing the department, as well as sales and merchandizing. He also advises that he is not vested nor does he own any dividends in Ann & Hope.

The legislation to be considered will involve taking a position concerning whether the State of Rhode Island should enter an agreement with the private developers of the Providence Place Mall involving the State's contribution of up to $6 million in sales taxes per year to the construction of a garage. This garage will serve the retail complex among other establishments in the down town Providence area. The legislation also provides that the State of Rhode Island shall have the option of purchasing the garage for $1 after a specified number of years. The Mall developers shall also pay the State a fee for use of the land on which the retail complex will be built. None of the public funds will be applied to the construction of the Mall itself.

The petitioner advises that he expects that the impact on his employer from the construction of the Providence Place Mall, if any, may be negative; some of their customers may be drawn to the new complex. However, he expects the impact to be slight in light of the fact that the Mall complex is expected to contain retail establishments in the moderate to high-priced end of the retail market while Ann & Hope serves the moderate to low end.

2. Analysis

R.I. Gen. Laws § 36-14-5(a). No person subject to this Code of Ethics shall have any interest, financial or otherwise, direct or indirect, or engage in any business, employment, transaction or professional activity, or incur any obligation of any nature, which is in substantial conflict with the proper discharge of his or her duties or employment in the public interest and of his or her responsibilities as prescribed in the laws of this state, as defined in section 36-14-7.

R.I. Gen. Laws § 36-14-5(d). No person subject to this Code of Ethics shall use in any way his or her public office or confidential information received through his or her holding any public office to obtain financial gain, other than that provided by law, for him or herself or any person within his or her family or business associate or any business by which the person is employed or which the person represents.

R.I. Gen. Laws § 36-14-5(e). No person subject to this Code of Ethics shall:

(1) Represent him or herself before any state or municipal agency of which he or she is a member or by which he or she is employed.

(2) 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.

(3) Act as an expert witness before any state or municipal agency of which he or she is a member or by which he or she is employed with respect to any matter the agency's disposition of which will or can reasonably be expected to directly result in an economic benefit or detriment to him, or herself, or any person within his or her family or any business associate of the person or any business by which the person is employed or which the person represents.

R.I. Gen. Laws § 36-14-7(a). A person subject to this Code of Ethics has an interest which is in substantial conflict with the proper discharge of his or her duties or employment in the public interest and of his or her responsibilities as prescribed in the laws of this state, if he or she has reason to believe or expect that he or she or any person within his or her family or any business associate, or any business by which the person is employed or which the person represents will derive a direct monetary gain or suffer a direct monetary loss, as the case may be, by reason of his or her official activity.

R.I. Gen. Laws § 36-14-7(b). A person subject to this Code of Ethics does not have an interest which is in substantial conflict with the proper discharge of his or her duties in the public interest and of his or her responsibilities as prescribed by the laws of this state, if any benefit or detriment accrues to him or her or any person within his or her family or any business associate, or any business by which the person is employed or which the person represents, as a member of a business, profession, occupation or group, or of any significant and definable class of persons within the business, profession, occupation or group, to no greater extent than any other similarly situated member of the business, profession, occupation or group, or of the significant and definable class of persons within the business, profession, occupation or group.

It is the opinion of the Rhode Island Ethics Commission that a State Representative employed by a retail establishment located in the City of Cumberland may participate and vote on legislation pertaining to the retail complex known as the Providence Place Mall.

The Commission bases this finding on the lack of a direct financial impact on the petitioner or his employer, defined as a "business associate"(1) under the Code of Ethics and previous Commission holdings.(2)

This Commission has previously issued several advisory opinions to legislators seeking guidance as to the propriety of their participating in discussions of and voting on legislation related to their outside employment or outside business interests. In General Commission Advisory No. 13, this Commission held that legislators' official decisions must be driven by "[an] assessment of what is in the best interest of the public, and not based upon any particular advantage which might accrue to the particular legislator." According to the Code of Ethics, specifically R.I. Gen. Laws § 36-14-7(a), a legislator has a substantial conflict of interest if he or she participates and votes on issues which would result in a direct financial benefit to the legislator, his or her family member, employer, or business associate. The Commission concluded that legislators may not introduce, discuss, or vote on legislation affecting their own, their family member's or business associate's financial interests unless such interests are affected to no greater or lesser extent than the interests of all of the members of the affected group or profession to which the legislator or his or her family member or business associate is a member pursuant to R.I. Gen. Laws § 36-14-7(b) ("the 7(b) exception").

In that General Advisory, this Commission also outlined a mechanism by which to clarify what constitutes "an interest in substantial conflict with the proper discharge of his or her duties" as opposed to a general interest in finding that "[t]he question in each instance must be whether the group that will be affected by the legislation is of sufficient magnitude to erase the specter that the legislator's actions are being influenced by the financial benefits" to that legislator. Thus, a legislator who participates in legislation "which applies generally to such legislator's business or profession," would not be in violation of the Code of Ethics. See Commission General Advisory No. 13.

This Commission has consistently ruled that legislators may participate and vote on matters before the Legislature when such matters do not entail a benefit to the legislator, a family member or a business associate greater than that to others of the affected group if it is a significant section of the public as outlined in R.I. Gen. Laws § 36-14-7(b).(3) In 1991, a legislator, who is simultaneously a private attorney handling personal injury matters, was permitted to sponsor and vote on legislation which would prohibit insurance companies from preventing one family member from filing a claim against another for personal injuries. See Advisory Opinion 91-25. In 1994, a legislator, also employed by the Rhode Island Philharmonic, was permitted to vote on the State budget which included an appropriation for the State Council on the Arts, an organization which funds her employer. See Advisory Opinion 94-34. More recently, a legislator employed as the executive director of agency concerned with drug and alcohol treatment was permitted to participate and vote on budgetary and policy issues concerning substance abuse. See Advisory Opinion 95-48. In addition, several advisory opinions were issued to legislators who are active or retired teachers allowing them to participate and vote on legislation concerning the state retirement system. See Advisory Opinions 95-54, 95-55, 95-56, 95-63, 95-64, 95-65, 95-69, 95-70, 95-75.

Footnotes

(1)"Business associate" is defined as a person joined together with another person to achieve a common financial objective.

(2)See Advisory Opinions 87-05, 89-37, 93-02.

(3)The lack of a direct financial impact on the legislator's employer which represents a narrow business interest distinguishes this matter from Advisory Opinions 91-16 and 92-28 in which we concluded that such financial impact required recusal by the legislator under the Code of Ethics.

Keywords

Private Employment

Class Exception