Advisory Opinion No. 99-57

Re: Carl I. Hoyer, Esq.

QUESTION PRESENTED

The petitioner, an East Greenwich Town Councilor,

a municipal elected official, seeks an advisory opinion as to whether he may serve as the liaison to the East Greenwich Free Public Library given that the Library receives the majority of its operating funds from the Town Council.

RESPONSE

It is the opinion of the Rhode Island Ethics Commission that the petitioner, an East Greenwich Town Councilor, a municipal elected official, may serve as the liaison to the East Greenwich Free Public Library (the Library). However, in his role as a Council member, the petitioner must recuse on any matters relating to the Library, including discussion or vote on the Library’s budget. As the liaison to the Library, the petitioner serves the interests of a private entity rather than a municipal department within the Town. As the business associate of the Library, the petitioner may not use his public position and/or office to benefit the Library in any way and may not vote on the Town Budget line-item for the Library.

Under the Code of Ethics, persons subject to the Code may not participate in any matters when it is likely that a “direct monetary gain” or a “direct monetary loss” will accrue to, inter alia, a business associate by virtue of any such official action. R.I. Gen. Laws §§ 36-14-5(a) and 36-14-7(a). In addition, a person subject to the Code may not participate in the consideration and/or disposition of a matter involving a business associate. R.I. Gen. Laws § 36-14-5(f). “Business associate” is defined as any individual or entity joined with a public official or employee “to achieve a common financial objective.” R.I. Gen. Laws § 36-14-2(3).

In numerous prior advisory opinions, the Commission has concluded that persons who serve on the Boards of Directors of for-profit and not-for-profit entities are “business associates” of the entities on which they serve. See A.O. 98-108 (concluding that state legislator could not submit a legislative grant for the Alms for Animals, a non-profit agency, given that she served on its Board of Directors); A.O. 98-76 (opining that member of Narragansett Town Council was prohibited from participating in matters concerning the Chamber of Commerce, including a vote to appropriate funds to the Chamber, given that she served on the Chamber’s Board of Directors); A.O. 96-75 (advising three members of the General Assembly who also serve as members of the Board of Directors of local hospitals to recuse themselves from any hospital issues given their business association with local hospitals); A.O. 95-59 (advising a member of the Smithfield School Committee to recuse from a vote concerning a community organization if the official’s association with the organization allowed him to affect the financial objectives of the organization).

In this case, the petitioner is a business associate of the Library because he serves on the Board of Directors and participates in and affects Library business. In addition, because the Library is not a municipal or government entity, the Petitioner would be using his official position as Council member in matters relating to the Library. His relationship with the Library triggers the prohibitions of R.I. Gen. Laws §§ 36-14-5(a) and 5(f). To comply with the Code, the petitioner may not act in any manner which could result in financial gain to the Library, including voting on the line-item relating to the Library in the Town Budget.

(Note: In Advisory Opinion 97-94, the Commission found that Town Council members, serving on the Health Services Board of Directors to protect the Town property interests, may participate in Town Council matters which affect the Health Services. Additionally in Advisory Opinion 97-145, this Commission found no substantial conflict of interest for the Executive Director of RIHMFC, who served as an ex officio member of the State Housing Appeals Board, to participate in a matter affecting a prior applicant before RIHMFC)

Code Citations:

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

Related Advisory Opinions:

98-108
98-76
98-44
98-16
98-10
97-51
96-75
96-54
95-59

Keywords:

Business Associates
Memberships