Gifts to Agencies Should Be Cleared with an Ethics Adviser

Anonymous

Thu, 11/08/2012 - 04:33

City Related

With the frequent confusion of person and office, sometimes it's not
that easy to tell the difference between a gift to a local
government agency and a gift to its director. This confusion can
open an agency director to accusations of ethical misconduct. 
 
This is what has happened in Baltimore. According to <a href="http://articles.baltimoresun.com/2012-10-17/news/bs-md-ci-pratt-angelos…; target="”_blank”">an
article in the Baltimore Sun</a>, the city comptroller accepted
the pro bono services of a firm whose most prominent member is the
owner of the Baltimore Orioles baseball team, in other words, a
major player in city politics. The legal services are for a suit
against the mayor, alleging that a large telephone contract was not
competitively bid.

The mayor came back with the allegation that the comptroller's
acceptance of the gift of legal services is a violation of the
ethics code. The comptroller insisted that the legal services were
not for her benefit, but for the benefit of the city's residents.
She also insisted that the Orioles owner does no business with the
comptroller's office, and that she would withdraw from any matter
involving him or his businesses or properties that came before the
comptroller's office or the Board of Estimate, on which she also
sits. 
 
Ask! 
The biggest problem with the handling of this situation has not
apparently been mentioned by either side. Before seeking a gift from
someone doing business with the city, especially in a complex and
combative situation such as this, involving someone so prominent as
the Orioles owner, an official should ask her city's government
ethics adviser what to do. Baltimore is fortunate enough to have
one, and he should be made use of. If she does not make use of him,
an official only has herself to blame for accusations made against
her. 
 
This situation should be used not to fuel a battle between
mayor and comptroller, but to show all officials and employees that
the first rule of government ethics is, Ask! 
 
The mayor is also wrong to accuse the comptroller of an ethics
violation. Baltimore has an ethics program. The mayor should seek an
advisory opinion or file a complaint, not act as if she is the one
who determines when ethics violations occur. It's understandable
that she's angry about the suit against her, but if she feels she's
in the right, she should act responsibly by going
through the proper channels in dealing with ethics issues. 
 
Basically, everyone handled this situation irresponsibly. The
comptroller should have sought advice from the city's ethics
adviser, the mayor should have sought advice from the city's ethics
adviser. And the comptroller's pro bono attorney should have kept
his mouth shut on government ethics issues he doesn't understand (he
wrongly stated that withdrawal from matters involving the law firm's
principal is sufficient to deal with a possibly illegal gift; see below for
more on this issue). 
 
Gifts to Local Government Agencies 
This situation is made especially complex because the
comptroller did not accept a gift of legal services to represent
the city's interests against, say, the state or a contractor that
has failed to fulfill its obligations under a contract. In such a
case, it would be much easier for her to treat the gift as one to
the city rather than to herself. As it is, she accepted the gift to
represent her agency against the mayor. The city's interest is not
clear. Only the outcome of the suit will, presumably, determine
whether her suit is in the city's interest rather than simply
representing her beliefs or her attempt to stymie the mayor. 
 
Considering all the circumstances, I would likely have advised the
comptroller to look elsewhere for legal services. If possible, her
office should pay for them. If she lacked the budget, she should
have sought out services from a firm or nonprofit legal services
organization that does not do business with the city. 
 
The reason is that, even if a gift of legal services is clearly in
the city's best interest, it is not the best thing for such a
high-level official, especially a comptroller – who should be above
reproach – to accept such a gift from someone doing business
with the city, especially someone so prominent. The appearance of
impropriety in this situation is too damaging. See <a href="http://www.cityethics.org/files/lgep1-0%20-%20Robert%20Wechsler.htm#Gif…; target="”_blank”">the
section of my book</a> Local Government Ethics Programs on gifts
to local governments. 
 
Withdrawal Is Not a Cure for an Illegal Gift 
Both the comptroller's attorney and the director of the University
of Baltimore's Hoffberger Center for Professional Ethics are quoted
in the article as saying that withdrawal is a sufficient cure for an
illegal gift. It is not. The proper cure for a gift is to return it
or, in this case, pay for services rendered and stop accepting the services in the future. Yes, the
comptroller should also withdraw from any matter involving the gift
giver, but this is a secondary cure. 
 
The attorney and the professor appear not to recognize the difference between a conflict
that exists and a conflict that is created. Let's say the pro bono
law firm employed the comptroller's spouse. Since a conflict exists,
the comptroller would have to withdraw from any matter involving the
law firm. The comptroller could violate the ethics code only by
failing to withdraw. 
 
But when an official accepts a gift from a law firm, she creates a
conflict. The creation of the conflict is a violation. The same
thing applies if the official's spouse were to accept a job from a law firm or other
company doing business with the official's agency or, in the case of
a high-level official such as the comptroller, with the city in any
capacity. The conflict should not have been created in the first
place. 
 
Withdrawal is not sufficient to cure this violation, although
withdrawal would be required. Failure to withdraw from a matter
involving the law firm would be a secondary violation. 
 
This is a difficult distinction to make. Even a professor of
professional ethics (but not government ethics) did not understand
it. That is why it is so important to seek advice from a trained
government ethics professional, and to make such ethics advisers
available. 
 
Requirement of Approval 
An alternative to seeking advice from an ethics officer or ethics commission administrator regarding gifts to a government agency is to require that officials seek approval, or a waiver, from the ethics officer or commission. In fact, Baltimore has just such a requirement (although it is limited to situations where the gift giver does business with the agency to which the gift is given, which may or may not be the case in the current situation). Here is the language from Baltimore's ethics code:<blockquote>

The prohibition [of soliciting gifts from those doing business with one's agency] does not apply to a solicitation if: 
(l) it is for the benefit of an official governmental program or activity or a City-endorsed charitable function or activity; and 
(2) it either: 
(i) is expressly allowed by a rule or regulation of the Ethics Board; or 
(ii) otherwise has been approved in advance by the Ethics Board, on the written
request of the public servant and his or her agency.</blockquote>

It's a good idea to make an explicit requirement such as this, since at least so far no jurisdiction requires its officials to seek government ethics advice when they are faced with a conflict situation. This provision accomplishes the same result, at least with respect to what are presented as gifts to an agency. 
 
The Baltimore provision, which is attached (see below), goes on to specify the standards the ethics board should use in deciding whether or not to approve, as well as giving a detailed description of what information must be included in a request for approval. Those who like their ethics codes short and simple will hate this provision. But this sort of detail, whether included in a law or in an ethics commission's rules and regulations, provides the necessary guidance to make the process work smoothly and fairly. The best way to structure this sort of approval process is to include it in an exception to gift rule, and provide a link to the relevant procedural rule, so that it won't make the code appear overwhelming to the great majority of officials and employees who will never employ this approval process. 
 
Robert Wechsler 
Director of Research-Retired, City Ethics 
 
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