Advisory Opinion No. 99-21

Re: James V. Silvestri

QUESTION PRESENTED

The petitioner, a Westerly Town Councilor, a municipal elected position, requests an advisory opinion as to whether he may participate in the Council's review of bids and/or the award of a contract for an administrator of the Town's landfill where he, as a principal of an automobile parts store, has sold parts in the ordinary course of business to companies that may respond to the Town's Request for Proposals (RFP).

RESPONSE

It is the opinion of the Rhode Island Ethics Commission that the Code of Ethics does not prohibit the petitioner, a Westerly Town Councilor, a municipal elected position, from participating in the review and/or award of a contract for an administrator of the Town's landfill notwithstanding the fact that companies that purchase parts from his automobile parts store may respond to the Town's RFP since his relationship with such companies is not a business association that would trigger the prohibitions set forth in R.I. Gen. Laws §§ 36-14-5(a) and 7(a).

Under the Code of Ethics, the petitioner, as a member of the Westerly Town Council, may not participate in any matter in which he has an interest, financial or otherwise, which is in substantial conflict with the proper discharge of his duties in the public interest. See R.I. Gen. Laws §§ 36-14-5(a), 36-14-7(a). An official will have an interest in substantial conflict with his official duties if it is likely that a "direct monetary gain" or a "direct monetary loss" will accrue, by virtue of the public official's activity, to the official, a family member, a business associate, an employer, or any business which the public official represents. See R.I. Gen. Laws § 36-14-7(a). Business associates are defined as an individual or entities joined together to "achieve a common financial objective." R.I. Gen. Laws § 36-14-2(3).

The petitioner seeks guidance as to whether he may participate in the proceedings regarding a RFP for an administrator of the Town's landfill if customers of his automobile body store respond to this request. After considering the relevant provisions of the Code of Ethics, it is our opinion that the petitioner may participate in the Town Council's proceedings relating to the contract even if customers of his store participate. Here, the Petitioner does not have contracts or specific business relationships for the sale of automobile parts with any of the potential interested companies; he merely sells parts to such companies in the ordinary course of business and there is no evidence that his business would be financially affected by the Council's decisions regarding the landfill administrator. Absent some direct and ongoing financial relationship, the normal commercial dealings between the petitioner and the interested companies do not rise to the level of business association as defined in R.I. Gen. Laws § 36-14-2(3). See A.O. 93-21 (concluding that a West Warwick Town Councilor who is a regular customer of a restaurant could participate in the review of an application for a twenty-four hour victualling license for that restaurant absent a significant financial nexus). Compare with A.O. 97-103 (concluding that a Westerly Town Councilor's close and dependent business relationship with a loan officer who had been vocal about an issue together with the financial impact that such an ordinance may have on the loan officer would result in a substantial conflict with his duties as a member of the Town Council); A.O. 96-6 (opining that a Westerly Town Councilor could participate in matters involving customers of his bank unless there was some direct or current involvement between the Councilor and the bank customer, the participation of the Councilor in a decision of the bank that directly affects the customer, or the involvement of a customer who substantially impacts the economic fortunes of the bank); A.O. 93-21 (concluding that a West Warwick Town Councilor who supplied food to a local restaurant that applied for a twenty-four hour victualling license should not participate in the review of the application since he would be directly financially affected by the decision). Accordingly, since there is no direct financial nexus between the petitioner and the potential interested applicants, he does not have an interest in the contract that would prohibit his participation in the Council’s consideration and decision.

Code Citations:

36-14-2(3)
36-14-5(a)
36-14-7(a)

Related Advisory Opinions:

99-11
98-117
98-70
97-103
97-7
96-100
96-6
94-60
93-21

Keywords:

Business associate
Business interest
Financial interest