The Educational Opportunities of a Local Ethics Case in Massachusetts

Anonymous

Fri, 03/22/2013 - 05:35

Complaints/ Investigations/Hearings

A settlement in a Massachusetts ethics proceeding can be used as
an educational opportunity in several ways. 
 
According to <a href="http://www.mass.gov/ethics/press-releases-meetings-and-publications/pre…; target="”_blank”">a
February 28 press release from the Massachusetts Ethics Commission</a>,
which has jurisdiction over local officials, a member of the
Kingston Community Preservation Committee (CPC) participated in the
making of a grant to a nonprofit organization for which she was the
unpaid president. The grant was for the renovation of two boat sheds
on the nonprofit's property, a river landing.

Educational Opportunity #1 - Training 
According to <a href="http://www.bostonglobe.com/metro/regionals/south/2013/03/07/kingston-en…; target="”_blank”">an article in the Boston Globe</a>, the CPC member said that she did
not know that being a volunteer member of a town committee made her
a “town employee” under the state ethics code. The chair of the
nonprofit's board is quoted as saying, “That was news to all of us.
That’s very little known.” 
 
Commission staff only give training sessions in towns that invite
them, and to officials who attend monthly in-house training sessions
in Boston. Kingston apparently has not requested a training session
or sent its board members to Boston, about 35 miles away. The CPC
member did attend an ethics session run by the town counsel, but it
was a year after the events occurred. And such sessions often make
little or no effort to show how an ethics code is applicable to each
sort of official or employee. 
 
<a href="http://www.nonprofitquarterly.org/governancevoice/21927-conflict-of-int…; target="”_blank”">A
column in the Nonprofit Quarterly</a> notes that, after what
happened, the CPC member's "two charities will be on top of their
conflict of interest policies and disclosures." Hopefully, this case
will get more than these two charities and this one official to look
more closely at the state ethics code and the responsible handling
of conflict situations. 
 
And hopefully, this case will either make many more towns request
ethics training from the state commission or get the state
commission to seek funding to provide mandatory training to local
officials. The commission was successful last year in getting
funding sufficient to hire a second full-time training person. And
last year as well, it put on its website <a href="http://www.mass.gov/ethics/new-online-programs-available-december2012.h…; target="”_blank”">an
improved training program</a> and a <a href="http://www.mass.gov/ethics/education-and-training-resources/implementat…; target="”_blank”">plain-language
summary</a> of the applicable ethics laws. But nothing is as good
as in-person training. 
 
Educational Opportunity #2 - Recognizing Conflicts 
One of the most important things officials should get out of ethics
training is the ability to recognize conflicts of interest when they
and their colleagues are faced with them. In this case, even after
what she's been through, the official still has a basic
misunderstanding of conflicts. 
 
According to <a href="http://www.wickedlocal.com/kingston/news/x711930998/Ethics-Commission-o…; target="”_blank”">an article on the Wicked Local Kingston website</a>, the official
"maintains that she never acted in conflict with the interests of
the town but rather acted in the interest of the town with the goal
of preserving its environment and history." She says that she was
simply doing what the preservation committee asked her to do. 
 
My organization, she said, "expends considerable effort and
resources to protect and improve the natural environment and
maintain the maritime heritage of the Jones River for Kingston, not
in conflict with it. Neither I nor the organization received any
private benefit from my work on the CPC.” 
 
In other words, the official takes the position that if an official
acts to help her town, she cannot have a conflict unless she or her
organization financially profits from it. 
 
This misunderstanding is extremely common. Most ethics codes
restrict conflicts to those situations where an official has a
financial interest in a matter. Being an unpaid nonprofit president
would not give rise to a conflict in most jurisdictions. 
 
The Massachusetts ethics code has an unusual provision that defines
a conflict in terms of agency. Section 17(c) of the code prohibits a
municipal employee from, "otherwise than in the proper discharge of
her official duties, acting as agent for anyone other than the
municipality in connection with a particular matter in which the
municipality is a party or has a direct and substantial interest."
That is, you cannot be on two sides of a matter, whether or not you
or anyone else can financially benefit from any decision that is
made. 
 
This provision effectively recognizes three facts that are often
ignored, and which the official in this case did not take into
account. One is that there is more to life than money. Even if a
nonprofit pays no one, the more grants it gets, the more power and
prestige its leaders have in the organization and in the community. 
 
Two, personal benefit is only one problem with conflicts. The more
important problem is how the public perceives what its government is
doing. When the public sees town committees giving grants to its
members' organizations, it comes to think officials are using the
government for their own purposes. Yes, those purposes may often be
aligned with the best interests of the community, but then again,
they may be aligned with the best interests of certain segments of
the community (e.g., those with boats). 
 
Three, the outcome of a matter is irrelevant to whether or not there
is a conflict situation. If you're wearing two hats, there is a
conflict, no matter what effect wearing two hats may have.
Similarly, withdrawing from a matter may be harmful to the public
interest if this changes the outcome for the worse. But the way to deal with this
problem is not by ignoring the conflict, but rather by asking
yourself whether someone without conflicts would be more effective
in your seat on the committee. 
 
The problem is that all this stuff has to be explained. It's not
clear from the provision itself. Language about "agency" and the
"proper discharge of official duties" is less clear to laypersons
than it is to lawyers. Local officials are required to sign off that
they've read the state ethics code, but this doesn't mean they
really understand it. They need explanation and relevant examples
before they can recognize conflict situations and deal with them
responsibly by seeking advice or withdrawing from the matter even if
they're not sure they have to. It's too bad that the CPC member did not have the benefit of the ethics commission's new plain-language summary, which includes lots of explanation and examples. Every ethics program needs a plain-language summary, but Massachusetts more than most, due to the unusual complexity of the ethics code's language. 
 
Educational Opportunity #3 - Volunteers and Terms 
This is the perfect case for the state ethics commission to use to
make it clear to all local volunteers that their volunteer status is
irrelevant to government ethics. They are local officials, whether
paid or not. In addition, it's a perfect opportunity to make it
clear to all officials that their work for nonprofits, or anyone
else for that matter, can give rise to a conflict whether or not
they are paid. In fact, high-level officials have many problems that
arise from their association with nonprofits. 
 
One thing that gets in the way is the term that the Massachusetts
ethics code uses for government officials and employees:
"employees." The definition defines "employees" to include
officials, but who reads the definition when the term appears to be
clear? This is somewhat corrected by having the first section of the plain-language summary say who is considered an "employee." 
 
Terms should be over-inclusive rather than under-inclusive, so that
the definition of the term clarifies rather than adds to a
term people, conduct, or activities that the term itself appears to
exclude. Since board and commission members are volunteers and,
therefore, do not in any way think of themselves as “employees,”
this term makes them think that the ethics code does not apply to
them. Definitions should never add to a term. They are there
primarily for clarification. 
 
Educational Opportunity #4 - Improper Influence and Disclosure 
Here the education is not of officials, but of the state
legislature. Education of the legislature is necessary because the
ethics code's influence provision, and its disclosure exception, are
even more problematic than the agency provision. 
 
Section 23(b)(3) of the state ethics code prohibits a municipal
official from "knowingly, or with reason to know ... act[ing] in a manner
which would cause a reasonable person, having knowledge of the
relevant circumstances, to conclude that any person can improperly
influence or unduly enjoy her favor in the performance of her
official duties, or that she is likely to act or fail to act as a
result of kinship, rank, position or undue influence of any party or
person." 
 
How can anyone comply with this provision? One needs to know what a
reasonable person would conclude about the manner of one's actions,
what influence is proper and what is improper (as well as due or
undue), and what it means to "unduly enjoy" someone's favor. One
also needs to be able to parse a very complex sentence, and to keep
one's eyes from blurring over words such as "kinship" and "rank,"
which nobody uses. This provision has a serious case of legalese,
which is deadly when contracted by laypersons. This language does
not belong in a government ethics code. 
 
But this isn't all. The section goes on to provide that "it shall be
unreasonable to so conclude if such officer or employee has
disclosed in writing to her appointing authority the facts which
would otherwise lead to such a conclusion." 
 
There are three serious problems here. One is making disclosure
sufficient to correct a conflict situation, even if involves
improper influence or preferential treatment. As long as you tell
your appointing authority that you are going to give your
organization a grant, it's fine. When what happened comes out, the
appointing authority waves the sheet of paper, and all the
reasonable people in the public will say that the government is to
be fully trusted, because although undue influence and self-serving
conduct is common, it is being privately disclosed to a public
servant. No, it doesn't work like that. Disclosure is not
sufficient, and secret disclosure makes it look like there's a
reason it's being hidden from the public. 
 
The ethics commission's executive director pointed out to me that such disclosures are public records, but you have to know about
the conflict before you can ask for the disclosure form.
Disclosure is supposed to be public, so it provides a check on
officials who might otherwise fail to deal responsibly with a
conflict. The only check here is that, after receiving the
disclosure, the appointing authority could ask the official to
withdraw. But this assumes that the conduct has not already occurred. 
 
Two, the disclosure exception is absurd, as written. The exception is
saying that it is unreasonable for a reasonable person to conclude
that any person can improperly influence, etc. because the facts
have been disclosed. The provision has gotten into a deep hole by
using the concept of a reasonable person, so that the only way it
can get out of the hole is by having the reasonable person's
conclusion magically become unreasonable. 
 
Three, the disclosure has to be in writing, even if the disclosure
occurs at a public meeting and is placed on the record, which is the
norm for transactional disclosure. This is what caught the Kingston
official. She told her appointing authority about her position with
the nonprofit, everyone on her committee knew, but she didn't put it
in writing until it was too late. If disclosure is to be private and
to one's appointing authority, then it should not have to be in
writing. If the appointing authority is going to lie to protect her
appointee, then she can just as easily type up a pre-dated letter
and lie about that. If the appointing authority is not going to lie,
then her testimony should be worth as much as a letter. In this
case, the appointing authority was behind the official all the way.
Only she chose not to manufacture a pre-dated letter. So the
official has to pay $2,500. That doesn't seem right. 
 
The executive director of the state ethics commission pointed out to
me in an e-mail that Section 23(b)(3) "only deals with the
appearance of a conflict of interest. You are still required
to comply with the other sections of the conflict law. For
example, under section 23(b)(2)(ii), you could not use your position
to provide an unwarranted benefit to someone, which is not available
to others who are similarly situated. So, even if you file a
disclosure in a certain situation to dispel an appearance of a
conflict because of a private relationship you have with someone who
would be affected by an action you are about to take, you are still
required to act fairly and without bias in taking the action.
If you cannot, then you must abstain from acting." 
 
This is very complicated, too complicated to provide clear guidance
to non-lawyers. The distinction between appearance and reality of
conflict situations is something government ethics professionals
like to make, and it is important to understanding government
ethics. But it is not a distinction that I think should be part of
an ethics code. In addition, enforceable ethics provisions should
not apply the concept of appearance. Taking appearance into account is important to the
provision of ethics advice, but it should not be the basis for
either enforcement or disclosure. 
 
In fact, the plain-language summary of this rule (see below) does
not provide the information the executive director provided to me so
clearly. It does not say that the disclosure does not cure other
rules; in fact, the example it gives makes it appear that it cures a
very basic conflict situation. It also does not say that the
disclosure must be filed before official action is taken, as the
executive director told me. Here is the plain-language summary:<blockquote>

A municipal employee may not act in a manner that would cause a
reasonable person to think that she would show favor toward someone
or that she can be improperly influenced. Section 23(b)(3) requires
a municipal employee to consider whether her relationships and
affiliations could prevent her from acting fairly and objectively
when she performs her duties for a city or town. If she cannot be
fair and objective because of a relationship or affiliation, she
should not perform her duties. However, a municipal employee,
whether elected or appointed, can avoid violating this provision by
making a public disclosure of the facts. An appointed employee must
make the disclosure in writing to his appointing official. 
 
Example where there is no violation : A
developer who is the cousin of the chair of the conservation
commission has filed an application with the commission. A
reasonable person could conclude that the chair might favor her
cousin. The chair files a written disclosure with her appointing
authority explaining her relationship with her cousin prior to the
meeting at which the application will be considered. There is no
violation of Sec. 23(b)(3).</blockquote>

Conclusion 
The official had a conflict and should have sought advice about it.
But without ethics training and in the misbelief that as a double
volunteer she had no conflict, she did not recognize that she had a
conflict. 
 
In addition, as a committee member, she had the reasonable misbelief
that she was not an "employee" and, therefore, not subject to the
state ethics code. The term should be changed to "official or
employee." Even the new online ethics course refers to the
government as the "employer." This sort of shorthand is confusing
for board and commission members. 
 
The language of the relevant ethics provisions is such that had she
read them, she still might not have recognized that she had a
conflict or even that she needed to disclose her conflict in writing, or if so when
(because all that legalese may not have convinced her that she had a
conflict). She did disclose her relationship with the nonprofit, but
didn't put it in writing in time, at least as the provision has been interpreted. 
 
A great deal can be learned from this case, by local officials,
especially volunteers; by nonprofits that seek benefits from local
governments; and by the state ethics commission and the state
legislature, which can improve the law and increase the budget for
ethics training, so that this sort of thing is less likely to happen
again. Steps have recently been made, but as long as the language of the ethics code is so difficult, it is an uphill battle. It shouldn't be a battle at all. 
 
Robert Wechsler 
Director of Research-Retired, City Ethics 
 
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The Educational Opportunities of a Local Ethics Case in Massachusetts

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