Advisory Opinion No. 95-104

Re: Michael P. DeFrancesco

A. QUESTION PRESENTED

A member of the Exeter Town Council, also the principal owner of a civil engineering firm, requests an advisory opinion as to whether his firm may be listed on the Town's prequalified list of engineering firms when members of the Town Council, including the petitioner, participated in selecting firms to appear on said list.

B. SUMMARY

It is the opinion of the Rhode Island Ethics Commission that the petitioner, a member of the Exeter Town Council and also the principal owner of a civil engineering firm, would violate the Code of Ethics if his firm were to be selected from a prequalified list of engineering firms to provide services to municipal agencies. We base our conclusion on the petitioner's representations that he participated in preliminary decisions as to whether to introduce the prequalified list procedure to the Town of Exeter, that he participated in reviewing the qualification packages of firms responding to the Town's Request for Qualifications, and that he participated in the process of selecting firms to appear on the short list of prequalified firms. This Commission acknowledges that Mr. Francesco did not nominate his own firm to appear on the list of prequalified firms, but that he did nominate another firm to this list.

This Commission concludes that the participation by the petitioner in deliberations concerning a process--in the preliminary stages and in the ongoing development of the prequalified list--which could potentially benefit his firm is not permitted by the Code of Ethics, specifically Commission Regulation 36-14-5002. The potential for a public official's firm to receive an unfair advantage when its qualifications appear before said official's own agency, as well as the potential for a public official to influence the selection process to favor his or her firm, compels this Commission to recommend that Mr. De Francesco withdraw his firm from the list of prequalified firms.

C. DISCUSSION

1. Facts

Michael P. De Francesco, a member of the Exeter Town Council and simultaneously the principal owner of a civil engineering firm, requests an advisory opinion as to whether said firm may appear on a list of engineering firms "prequalified" to provide professional services to the municipal agencies of Exeter. The petitioner and other members of the Town Council expect that relying on such a list would save the municipality time and resources on small jobs costing less than a certain monetary threshold (approximately $5000) as opposed to the previous practice of advertising for services each time an individual agency required engineering services. Each individual municipal agency would consult the list when requiring such services. The individual firms would not be permitted to accrue fees above a certain annual threshold.

As represented by the petitioner and pursuant to R.I. Gen. Laws § 45-55-12, municipalities are authorized to "provide for prequalification of suppliers as responsible prospective contractors for particular types of supplies, services, and construction." Municipalities opting to create a prequalified list are required to "adopt regulations for prequalification in the same manner provided for in the adoption of ordinances..."

Upon deciding to rely on a prequalified list of engineering firms, the Town Council publicly circulated a "Request for Qualifications" in response to which numerous qualification packages were received. The petitioner advises that his firm submitted its standard qualification package, which was discussed with the other packages at a meeting regarding the prequalification process. Each firm was required to submit documents reflecting the type of projects previously undertaken, staff resumes, and references from clients concerning projects. Approximately seventeen firms responded to the request, and five of these were selected to appear on the short list which would become the prequalified list.

The process for selecting the five agencies to appear on the short list involved reviewing the qualification packages submitted by the individual firms. Each member of the Town Council was then asked to nominate a firm to the list. The petitioner advises that he made the motion to select the firms through this process, and that he also nominated a firm, not his own, to appear on the short list. His own firm was nominated by another member of the Town Council.

Following the selection of the prequalified list of engineering firms, Mr. De Francesco was approached by a citizen who questioned the propriety of his firm appearing on the list and providing services to the Town while he sits on the Town Council. The petitioner specifically requests guidance as to whether his firm may provide services to the Town of Exeter and, if so, under which conditions. Mr. De Francesco advises that if the above process by which his firm came to appear on the prequalified list is improper, he would immediately withdraw his firm from consideration as a prequalified firm. Finally, he advises that no services have been or will be provided to the Town by his firm while he awaits a decision from this Commission.

2. Analysis

At issue in this advisory opinion request is whether a civil engineering firm, with which a member of the Exeter Town Council is affiliated as a principal owner, may be listed on the Town's prequalified list of engineering firms. Relevant provisions of the Code of Ethics include the following:

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. In cases of hardship the Ethics Commission may permit such representation upon application by the official and provided that he or she shall first:

(a) advise the state or municipal agency in writing of the existence and the nature of his or her interest in the matter at issue, and

(b) recuse him or herself from voting on or otherwise participating in the agency's consideration and disposition of the matter at issue, and

(c) follow any other recommendations the Ethics Commission may make to avoid any appearance of impropriety in the matter.

(4) Shall engage in any of the activities prohibited by subsection (e)(l), (e)(2) or (e)(3) of this section for a period of one year after he or she has officially severed his or her position with said state or municipal agency; provided, however, that this prohibition shall not pertain to a matter of public record in a court of law.

Regulation 36-14-5002 Additional circumstances warranting recusal.\l1 A person subject to this Code of Ethics must also recuse himself from participation and notify, in writing, his board/agency of an interest when any of the following circumstances arises:

His or her spouse (if not estranged) or dependent child appears before his or her board/agency.
His or her business associate, spouse (if not estranged) or dependent child authorizes another person to act as attorney-at-law or attorney-in-fact and that authorized individual appears before his or her board/agency representing his or her business associate, spouse (if not estranged) or dependent child.
His or her employer, or the interests of his or her employer appear before his or her board/agency.

Regulation 36-14-5003 Limitations on recusal\l1. The notice and recusal provisions of sections 36-14-5 (e)(l) and 36-14-5(f) shall not be interpreted so as to permit a person subject to this chapter to make use of such provisions on a regular basis. If such actions occur with such frequency as to give the appearance of impropriety, the person subject to this chapter may be deemed to have violated the provisions of this chapter, unless such actions are necessitated by circumstances beyond the control of such person and are the only legal course of action available to such person in order to protect a vested property interest.

R.I. Gen. Laws § 36-14-7(a). Interest in conflict with discharge of duties\l1. 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.

This Commission concludes that the participation by a public official in deliberations concerning a process--in the preliminary stages and in the ongoing development of the prequalified list--which could potentially benefit his firm is not permitted by the Code of Ethics, specifically Commission Regulation 36-14-5002. The potential for a public official's firm to receive an unfair advantage when its qualifications appear before said official's own agency, as well as the potential for a public official to influence the selection process to favor his or her firm, compels this Commission to recommend that Mr. De Francesco withdraw his firm from the list of prequalified firms.

In an advisory opinion considering an issue similar to the one presented by the petitioner, this Commission concluded that a member of the Smithfield Town Council, also employed by and having a financial interest in a computer company, may not participate in and vote on matters involving proposals submitted to the Town for municipal computer goods or services in the event the petitioner's company submits bids or proposals relating to the same pursuant to R.I. Gen. Laws § 36-14-5(h). See Advisory Opinion 91-60. See also Advisory Opinions 83-7 and 91-23. Further, the Commission concluded that in the event a particular issue involving the purchase of computer goods or services should come before the petitioner, he should exercise notice and refrain from participating in the discussion of or voting on any matter connected with the contract. In view of the fact that Mr. De Francesco did not exercise these precautions, his firm may not be considered for the prequalified list unless and until an open and public bidding process begins again, with full recusal by Mr. De Francesco in that process.

Keywords

Purchasing

Contracts

Business Interest

Referrals