Advisory Opinion No. 98-33 Re: Nicholas Trott Long, Esq. A. QUESTION PRESENTED The Petitioner, Legal Counsel to the Commissioner of Higher Education and Rhode Island College, a state employee position, requests an advisory opinion as to whether he and his business associate may contract with Rhode Island College for computer software developed by the Petitioner and his business associate and for the computer services attendant with the computer software without open and public bidding given that Petitioner works part-time as legal counsel to Rhode Island College and given that the product and services are unique and not available elsewhere. B. SUMMARY It is the opinion of the Rhode Island Ethics Commission that the Petitioner, Legal Counsel to the Commissioner of Higher Education and Rhode Island College, a state employee position, and his business associate may contract with Rhode Island College to sell the unique computer software which they developed and to provide computer services without open and public bidding provided that the contract complies with the State Purchases Act criteria for sole source procurement. This opinion is limited to these circumstances, however, and would not apply had Petitioner actively used his public employment to solicit this private business for himself or his business associate. C. DISCUSSION 1. Facts The Petitioner is an attorney in private practice in Providence, RI. He is also employed as part-time Legal Counsel to the Commissioner of Higher Education and Board of Governors of Higher Education. In that capacity, he provides legal services to Rhode Island College (hereinafter "RIC"). In the Petitioner's private practice, he conducts legal audits of schools, colleges and universities. As a by-product of that work, the Petitioner and Michelle Ricci, principal of MCR Research, Inc. ("MCR"), developed the Electronic Policy Guide.ä The Petitioner states that the Electronic Policy Guideä is a unique product containing proprietary software and is available only from MCR and the Petitioner. The Petitioner and MCR collaborate together on projects involving their computer software. In the ordinary course of discussions between the Petitioner and individuals at RIC regarding the Petitioner's private law practice in general, and not by means of direct solicitation by the Petitioner, RIC learned that the Petitioner and MCR had developed the electronic Policy Guideä which the Petitioner and MCR sells to schools, colleges, and universities. RIC wishes to purchase the software and to contract with the Petitioner and MCR for the attendant professional services as a sole source procurement as provided for in the State Purchases Act, R.I. Gen. Laws § 37-2-21. The Petitioner has indicated that he would not receive any compensation for the Electronic Policy Guide.ä However, MCR would be compensated at its customary rate. 2. Analysis The Rhode Island Code of Ethics (the "Code") holds all public officials and employees to the "highest standards of ethical conduct" and requires that they avoid even the "appearance of impropriety." R.I. Gen. Laws § 36-14-1. A person subject to the Code may not use his or her public employment or confidential information received through his or her public employment to obtain financial gain for him or herself or for a business associate. R.I. Gen. Laws § 36-14-5(d). In addition, no person subject to the Code nor any business associate of said person may enter into a contract with a state 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). The section provides an exception for "contracts for professional services which have been customarily awarded without competitive bidding." Id. In this case, the Petitioner and RIC wish to contract for proprietary computer software available only through the Petitioner and his business associate despite the Petitioner's employment relationship with RIC. Cognizant of the Code, however, they sought the opinion of the Commission before proceeding. Under the circumstances presented, the sole source procurement contract between the Petitioner, his business associate and RIC would not violate the Code. This situation does not implicate section 5(d), because the Petitioner did not use his employment or confidential information gained from his employment to acquire the contract. Rather, RIC raised the idea of the contract after learning, through ordinary conversation, of the Petitioner's computer software and services. Further, no violation of the Code will result if the Petitioner and his business associate contract with RIC as a sole source procurement, without open bidding, provided that the Petitioner and MCR meet the criteria for sole source procurement as provided by state law. RIC is subject to the State Purchases Act (the "Act"), R.I. Gen. Laws § 37-2-1 et seq. Like section 5(h) of the Code, the Act requires that all state contracts and purchases be awarded only after open and competitive bidding or negotiation. However, unlike section 5(h), the Act provides exceptions when 1) the contract meets the criteria for sole source procurement or 2) it constitutes a "small purchase." Under the Act, contracts requiring the expenditure of public funds may be awarded as a sole source procurement only after the chief purchasing officer for the state or other designated person "determines, in writing, that there is only one source for the required supply [or] service." R.I. Gen. Laws § 37-2-21. To the extent the Petitioner and MCR meet the criteria for sole source procurement under state law, any requirement by the Commission that they contract only after open and public bidding would contravene state law and put form over substance. Additionally, this circumstance is akin to a contract for professional services customarily awarded without competitive bidding and should not require open and public bidding when only one provider exists. Thus, in this limited circumstance, the Code will not be violated if the Petitioner, MCR and RIC contract without open and public bidding. Code Citations: 36-14-1 36-14-5(d) 36-14-5(h) Keywords: contracts