Advisory Opinion No. 98-124

Re: Thomas Mattos

QUESTION PRESENTED

The Petitioner, the Finance Director for the Town of Cumberland, a municipal appointed position, requests an advisory opinion as to whether the Town may award a bid to a firm given that a Town Councilor, a municipal elected position, is employed by that firm.

RESPONSE

It is the opinion of the Rhode Island Ethics Commission that the Town of Cumberland may award a bid to a firm for group life insurance although a Town Councilor, a municipal elected position, is employed by that firm. While the Town Councilor works as an independent insurance broker for the same company as the successful low bidder, the Town Councilor did not participate in the bid development as a Town Councilor and did not take part in the bid submission of his employer, Benefit Development Group. Additionally, Cumberland followed an open and public process for the group life insurance contract consistent with the requirements of Section 5(h). Based on these factors, and since there is no indication that the low bidder obtained confidential information regarding the contract submissions (See R.I. Gen Laws §§ 36-14-5(b),(c)), the Code does not prohibit the award of the group life insurance contract to Benefit Development Group.

The Code of Ethics provides that a public official, his/her family, business associates, or any business entity where the public official's family or business associate has a 10% equity interest or a $5,000 cash value interest, may enter into a contract with a municipality provided the contract has been awarded through an open and public process, including public notice and subsequent public disclosure of all proposals considered and contracts awarded. See R.I. Gen. Laws § 36-14-5(h). The Commission previously has ruled that officials who participate in the bid development process place themselves or their employers in a privileged position with respect to other bidders and consequently diminish, if not eliminate, the "open and public process" required under the Code. That did not happen here. The Cumberland Finance Director developed the bid specifications for the group life insurance contract without any involvement by any members of the Town Council.

Additionally, public officials are prohibited for disclosing confidential information for pecuniary gain. See R.I. Gen Laws §§ 36-14-5(b), 36-14-5(c). Again, here there is no indication that any members of the Town Council had confidential information relating to this contract or that any confidential information was disclosed to the low bidder. Therefore, nothing in the Code of Ethics prohibits the Town of Cumberland from awarding the group life insurance contract to Benefit Development Group or one of its agents.

Code Citations:

36-14-5(b)

36-14-5(c)

36-14-5(h)

Related Advisory Opinions:

98-46

98-50

98-61

98-65

98-86

98-90

97-15

97-24

97-37

97-50

97-66

97-94

97-122

97-136

97-148

95-41

Keywords:

Contracts