Advisory Opinion No. 98-82

Re: Harold R. Shippee, Sr.

A. QUESTION PRESENTED

The Petitioner, a Foster Town Councilor, a municipal elected official, requests an advisory opinion as to whether he may participate in the Council's consideration of whether to form a special committee to review an existing Town ordinance that provides a tax freeze to the elderly and disabled where his spouse's parents benefit from the tax freeze.

B. SUMMARY

It is the opinion of the Rhode Island Ethics Commission that the Petitioner, a Foster Town Councilor, a municipal elected position, may participate in the Council's consideration of whether to form a special committee to review the Town's tax freeze ordinance notwithstanding the fact that his spouse's parents benefit from it since it is not reasonably foreseeable that his participation would result in an economic benefit or detriment to his in-laws. His participation in the vote to establish a special review committee, therefore, would not trigger the prohibitions set forth in R.I. Gen. Laws §§ 36-14-5(a) and 5(d). If, however, the Town Council considers any specific proposals or revisions relating to this ordinance or if the Petitioner seeks to become a member of the special committee, those prohibitions may be implicated and the Petitioner should seek additional guidance from the Commission.

C. DISCUSSION

1. Facts

In 1974, the Foster Town Council enacted an ordinance to provide tax relief for the elderly and the totally disabled. Under the provisions of the ordinance, any resident who has attained the age of sixty-five or who is totally disabled may file an application to stabilize the rate of taxation and the valuation of up to 4.5 acres of property, provided that the property is used for residential and noncommercial use. The parents of the Petitioner's wife applied for and receive the benefits of the tax freeze.

According to 1992 figures, approximately 200 elderly and/or disabled households have applied for and received benefits under the ordinance. The elderly and/or disabled residents who have applied for and obtained the benefits of the freeze before 1989 have had the assessed value of their property frozen before the Town reevaluated property values, which has resulted in significant tax savings.

Since passage, the Town Council, either formally or informally, has considered the tax freeze ordinance on a number of occasions. By a letter dated June 17, 1997, the Tax Assessor, Anne Carlson, after citing problems with the application of the ordinance, recommended that the Town Council create a non-partisan committee to review the intent, language, and interpretation of the ordinance. Ms. Carlson also suggested a list of possible changes and areas to be addressed.

On August 7, 1997, after considering Ms. Carlson's request, members of the Town Council voted against a motion that would have empowered the Tax Assessor to form a committee to study the tax freeze ordinance. The Petitioner voted in favor of the motion, thereby supporting the creation of the non-partisan committee. Since this vote, the Town Council has held workshops to study the ordinance.

The Petitioner anticipates that either the Tax Assessor or private citizens again will request the Town Council to form a committee to revise the ordinance at issue. He inquires as to whether he may participate in the Council's consideration of this issue.

2. Analysis

The Code of Ethics prohibits public officials from taking any official action that is likely to have a direct financial or monetary impact on, among others, a family member, or from having an interest which is in substantial conflict with the proper discharge of their duties in the public interest. See R.I. Gen. Laws §§ 36-14-5(a), 36-14-7(a). A substantial conflict of interest occurs if the Petitioner has reason to believe or expect that a family member would derive a direct monetary gain or suffer a direct monetary loss by reason of his official activity. See R.I. Gen. Laws § 36-14-7(a). An official has reason to believe or expect a conflict of interest exists if it is "reasonably foreseeable" that either he or a family member will be financially impacted. To be "reasonably foreseeable" the probability must be greater than "conceivable," but the impact need not be certain to occur. See Commission Regulation 36-14-6001.

Here, the Petitioner asks whether the Code of Ethics would prohibit his participation in matters relating to the formation of a special committee to review and study the tax freeze ordinance. Provisions of the ordinance, which provides a tax freeze to the elderly and the disabled benefit his wife's parents. After considering the relevant provisions of the Code of Ethics, we conclude that the Petitioner may participate in the Council's consideration of whether to establish such a special review committee. At this preliminary stage of review of the ordinance there is no evidence that his in-laws will receive a direct financial gain or suffer a direct financial loss as a result of the formation of such a committee. See A.O. 98-30 (opining that a member of the Barrington School Committee may vote on the selection of a construction manager where one of the three candidates considered was a client of the Petitioner's law firm provided that the vote does not affect the financial interests of his law firm's client); A.O. 97-86 (advising a member of the Newport School Committee that he could participate in the appointment of a candidate to a Teacher's Aide Position notwithstanding the fact that his wife previously had been an applicant for this position since he did not have reason to believe or expect that his wife would receive any financial benefit by his vote given that she was no longer a candidate and he planned to vote for the appointment of the nominated candidate).

Here, the proposed vote only would concern establishing a special committee to study the tax freeze. The special committee may identify inadequacies in the present ordinance and /or suggest possible revisions to it. Before enacting any specific changes in the ordinance, however, the Town Council necessarily would consider the committee’s recommendations, publicly notice any proposed revisions, hold a public hearing, and vote on any proposed revisions. In other words, a number of independent, intervening steps would need to be taken before anyone, including the Petitioner’s in-laws, were affected. This situation, therefore, is distinguishable from that addressed by the Supreme Court in Celona v. Rhode Island Ethics Commission, 544 A.2d 582, 586 (R.I. 1988). There, the Court held that the members of the North Providence Town Council violated the Code of Ethics when they enacted a preliminary resolution granting themselves $100 in monthly expense money. Although the resolution required final approval by the General Assembly, the Court found that the Council members had reason to believe or expect that the passage of a resolution would result in a personal financial benefit since the General Assembly generally adopted verbatim resolutions to amend a Town Charter.

However, the Petitioner is advised that the rationale of this opinion is limited to the formation of a special committee to study the tax freeze. This opinion would not apply if the Council, either by action of the special committee or otherwise, considers any future proposals or recommendations that impact his in-law's interest in the freeze since it would implicate the prohibitions set forth in R.I. Gen. Laws §§ 36-14-5(a) and 5(d). For example, if the Council considers a committee recommendation to abolish the tax freeze, change the eligibility requirements, or cap the benefits, it is reasonably foreseeable that the recommendation would impact his in-laws’ financial interests. Additionally, our opinion here does not give the Petitioner license to serve on such a committee where its members may formulate recommendations or changes to the tax freeze ordinance. The Petitioner, therefore, is cautioned that, should the Council consider anything beyond establishing a committee to study the ordinance, he should seek additional guidance from this Commission.

Code Citations:

36-14-5(a)

36-14-5(d)

36-14-7(a)

36-14-6001

Related Advisory Opinions:

98-30

98-27

97-86

Related Case Law:

Celona v. Rhode Island Ethics Commission, 544 A.2d 582,

586 (R.I. 1988)

Keywords:

Family: financial benefit