DAN MORALES

r\l-rORNEY GENERAL 

## QMfice

oftfy !&tornep &neral Qtate of ID;exas
March 17,1993

Mr. JamesL. Crouch ExecutiveDirector Publicutility commission 7800 ShoalCreekBoulevard Austin, Texas 78757 OpinionNo. DM-209

Re: whether the hner employee of the Public Utility Conumss~

’ ‘on who goes to work for an afHiate of a qulated utility violates nection6 of a&k 1446c.V.T.C.S. (RQ-118)

Dear Mr. Crou&
You ask seeral questions about the post-employmentrestrictions applicableto a Public Utility Commission(PVC) employee who resigned to work for an a5liate of a PUC-regulatedtelephone company. You state that one of his last PUC assignmentswas asprojectmanagerfbra managementaudit on the regulated company. The audit was completed in Februaq 1991, and the employee resigned from the PUC in May 1991, beginningemploymentfor the affdiate soon after. You state that the employee and the president of the regulated company, who was a&o president of the a5liate. apparently began employmentnegotiationswhilethe audit ofthe telephonecompanywas in progress.
Article 1446c, V.T.C.S., the Public Utility Regulatory Act (Pm), restricts certain trwsacdons between PUC employees and a5liates of publicutilities. In general,
an”~te”orM*Iffiliatedintaest”ofaplblicutilityieapaaonorentitythatcM subswially control the policies and actions of the pubiic utility, that is subject to being controlledinthiswaybythepublicutility,orthatisurdercommon Oxltrolofthesame entity as the publicutility. Section 3(i) of article 1446cde&s these terms as follows:

“A6iliatedinterest”or”~“means: (1) any person or corporation owning or bold& dimctly or indktly,fivepercentormoreofthevotingseauitiesofapubtic utility;’ (2)anypersonorcorPorationinanychainofsucceaGve ownership of five percent or more of the voting securities of a public utility.

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(3) 8ny wrpomtion 6ve pacent or more of the voting ssurities of which is owned or controlled, dir&y or indkctly, by a public utility; (4) 8ny wrporation fivepercent or more of the voting securhies ofwhichisownedorw~~~direatyorindirectly,byanypenon
or corporation that owns or wntroh dkectly or indkdy, five pacmtormoreofthevotingrearritiesofMypublicutility...; (5) anypemonwhoisanofficerordirectorofapublicutilityor ofanywrpomtioninanychainof- ownership of sve percent or more of vodng aeauitk of a publicutility; (6) anypersonorwrpomtionthatthewmmission,afkrnotice and heaing, determinesact&y exercisesany substantialinfluenceor control ova the policies and actions of a publicutility, or over which rpublicutilityexerciaessuchwntrol.. .; (7) any person or wyratiti the wmmission a&r notice andhearingdetumines exacihgsuchsubstMti8l **infium over** 

**the policies**  **and** action of the publicutility

. . . . Section 6 ofPURA prohibii various mmsactions between employees and fbrmer ~l~ofthePUContheonehand~dpublicutilitiesMdtheiratbliat~ontheother. This sectionprovides in part:

6-QNo ccmmhiona or employee of the wmmission may dirwtlyorifdindysolicitorrequeatfiomorauggestorrewmrnwd to. my public utility, or to any agaq lqWen&q attolney, anploye+ officer, owner, director, or partner thereoc the appointmenttoanypositionortheemploymentin8nycapachyof anypasonbysuchpublicu5ityora5lkedintaest. (e) No public utility or dEliated intatst....nor any agent, ItpmaWq attorney, employcq officer, owner, director, or paRnerofarrypublicutilityora5liatedintere&...maygivqor offatogive,any...anployment...wfiatsoevato~manberor employee of the wmmission

. . . .

. . . (i) No.

. . employee aha&within one year afta his employment with the wmmision has ceased, be employed by a public utility which w8s in the scope of the wmmission& or employee?3 05cial responsiiity while the wmmissiona or employee wns assoc&d with the wmmission.

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(j)Duringthetimea wmmissiona or en@oyee of the wmmissionisassocb&withthewmmissionorat~time*, the wmmissiona or employee may not mpmseat a paaoq wrporatio~~ or other business entity before the wmmission or a courtinamattainwhichthewmmissioneroranployeewas pasondyinvo~whue asao&edwiththewmmissionora mattathuwaswithinthe cxmlmhids or employee!? official responsiii while the wmmissioneroremployeewasllso&ed with the wmmision. V.T.C.S. art. 1446c.5 6.
You 6rst ask whetha section 6(i) was violated under the facts you have provided. Although we calmotresolve fact questionsin an attorney gulaal opinios we can answer a legal questionbased on facts providedto us. Attorney General Opiion JM-495 (1986). Attorney Genersl Opiion JM-280 (1984) concluded that section 6(i) of article 1446c applied to the employment of a former member or employee of the Public Utility Commission by a public utility, but not to that person’ s employment by en e5liated inkrestofrpublicutility. Acwrdingly,amumingthea5iiateinthiscaaemeetsthe definitionset out in section 3(i) of PLRA, the former employeedid not violate section 6(i) by awep6ng employmentwith that entity.
YounartuL~itwu”l~undaKaion6(d)urd(e)fortheemployee andthewmpMyo5catonegotiateauchM uranganentwhiletheo5cerwespresident ofboththew~undaauditMdthe~edw~~dtheemployeewrsthe PUC stafF

memba in chargeofthe audit?”
Section 6(d) provides that no PUlM employee may “solicit or request from or suggest or recommendto” any 05cer of a publicutility, “the employmentin eny capacity of~pcrsanbysuchpublicutilityora5liatediaterest.” (Emphesisedded.) Inour opinion, the proh.i.ion in section 6(d) sgainst soliciting anployment for any person would bar a PURA employee fkommaking such solicitations, requests, suggestions, or r-mmemMonsonbehalfofhisownallployment. IfthePURAanployeeaskedthe o5~foremploymmtwithtbe~eormademyothaoftheproMibed wmmmications, he violated section 6(d).
Section 6(e) provides that no “05ca.. .ofanypublicutilityor[any]effWed intaest.. .may givq or offa to give. [My] employment...- to any...emp4oyeeofthewmmission.” Iftheo5caoftheregu&dutilitymadefmoffa of employmentto the PUC employee whilethe employeeworked for the PUC, the 05cer

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violated section 6(e).3 Whetha the PURA employee or the officcxsnsllgsd in wnduct proscrii by s§ion (6)(d) or 6(e) of article 1446~is a question of fact that cumot be fdhSSdiUMattorneygWMllOpiUiOll. You~Mkwhdbamyothallpplicablekanwaeviokteduadathe~ stated. YoudonotapeciQ~statutetiyouwishwtorddrrss,butwealggestttlat **you wnsider** 

**whether section**  **8** of article 6252~9b,V.T.C.S., as well as se&on 39.01 of the Penal Cd might applyto the case you have de&x&d. Won 8 of article 6252%. V.T.C.S.. is designedto prevent a state 05cer or employee 6vm using his 05chl position to seek personal gain. It prohibits 05ccrs and employees hm having various private ewnomic illtams that might influencethem in their exacise of public authohy.’ see Attorney General Opinion Jh4-587 (1986) (section 8 of article 6252-9b, V.T.C.S. provides
no tanctions for violations of its provisions).

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Your mmabdngthree questionsare as fbllows: (4)Ifthescfkctshadoc~~edatIerJanwyl,l992,the effectivedate of Senate Bii 1, -;=I Legidatun, R@ar sessiol& 1991.wouldyour - * (5)Towhatextent,ifany,wiUtheethicslawestabliahedio PURA wnhue to apply to PUC wmmissionu5 and 8taff afta the dfective date of SenateBill l? (6) Conve&y~towhatextent,ifany,willthenewethicskW &Ii&d in Senate Bill 1 apply to PUC commisrionas and staff 8fkitSCfkUiVCdlUC? senatCBiulofthe72dLegiskture~~~provisionsregulatingthedhicsof public savants.) Some of its provisions address conduct also wveted by section 6 of article 1446c,V.T.C.S. Article 6252-9b,V.T.C.S.. adopted in 1973to establishstandards of wmhlct for state 05cers and employces,~applies to 05cers and employees of the PUC. Srr V.T.C.S. art. 6252-9b. 50 2(l), (S)(A)(i), o(A). **(S)(A)** (dcfming “state o6ica” and “state employee”). Senate Bill 1 adopted several amendments to article 6252-9b, V.T.C.S., but most of these do not overlap with section 6 of article 1446c, V.T.C.S. SIX V.T.C.S. art. 6252-9b. §7B (probibithg assockion of employees of regulatory agency from sokiting anyhing of v&e hm regulated entities). Section 74 thepaendmentmostrelevanttoyouriaquiry,providesasMknvs:

(a) **A** memba of the goveming body or executive head of a regulatoryagencymaynotmak~withtheintenttoin6ualc4My wmmunication to or appearancebefore an 05cer or employeeof the 8gencyinwhichthepason~beforethe~ud~of thedatethepersonccasestobeamemberofthegovaningbodyor cJtecukllaldoftheagency,onbehalfofmlypuaoninwmIeuion withanynwlaonwhichtheperaon~o5cialaction. (b) Aformerstateo5caoraqhyeeofareguhtoryagcq whoceasesserviceoremploymentwiththeagencyonorah January 1, 1992, may not repnsent any pason or receive compensation for pavices rendered on behalf of any pcmon ~aparticularmatterinwhichthefonnao5.caoranployee participated during the period of state service or employment, &her t&oughpasonrlinvo~entorbccausethecaseorprocesdingwrs
a matta withinthe 05&s or employee’ s 05cial respomiibii. This

‘Acls 1991, M Leg. dl. 304. at 1290.

‘kas 1973.63d Lc& ch 421.a11086

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subsection does not apply to a rule-mahing procad@ thet was concluded before the 05&s or employee’ sservice or employment aared. (c) Subsection(b) ofthis sectionnppliesonly to: (1) asteteofficaorrregulatoryrgency,or (2) a state employee of a regulatory egency who is wmpensated

. . . [detsils of wmpensation set out]. (d) rjorher Iawre.rfriUsrhr rzpresarrariar ofaperson befav a prtiadar stale

agent @ afonnrrstate ofleer or emplqwer,

lhe dher &nvpr6waover

this section. V.T.C.S. at. 62524%. 5 7A (emphesisadded).
Swtion 6tj) of the PuRq quoted above. prohiits a forma state 05ca or anployet f+omrrpr*renting personsbeforethePucunda-similatothose set out in section 7A Section 6(j) applies during the time the officer or employee is ILWC&~ with the wmmission “or at sny time a&r.” V.T.C.S. at. 1446c, 6(j). It prohibits the wmmissiona or employee from represemmg nny “perso& wrporatig or otba busin- entity hefore the wmmission or a wurt in a mstta in which the wmmissiona or employee was pasonslly involvedwhiJeamociated with the wmmission oramnttathntwesvdthinthewmmissi on&s or employee!? 05cinl reqxmsibiity” while raoaaed with

thewmmission.

Id. As expressly

provided in section 7A(d) of article 62524b, section 6(j) of the PUM prevahs ova section7A@). Accordiagly,~&nnotbdieveouruLIwawouldbediffantifthetrpasactions youdescribehndouauredemirelyefkatheefktivedateofSennteBill1. Section7Aof article 62524b. V.T.C.S.. does not npplyto the PUC. You have not identilied eny otha provisionsofSensteBilllthatappeartownflictwithprovisionsofsection6ofthe PUPA Amumingthe ebsence of wntlicting provisions,the wmmissioners and employees ofthePUCeresubjecttotheprovisionsofSenateBii1tothesemedegreensaestete agency 05cers and employeesin geneml.



### SUMMARY
Section 6(i) of article 1446c. V.T.C.S., pawides thst a fbrmer employee of the Public Utility Commission (PVC) may not be employed within one year afta leaving the commission by II public utilitythatwasinthcscopeofhiso5~responsibilitywhilehe worked for the wmmission. This prohibition does not bar a former employee from working for the a5liate of such publicutility within a year afla his depature &omthe wmmission.

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Section 6(d) of article 1446c, V.T.C.S.. pro&bits an employee of the Public Utility Commission(PVC) fhm asking an 05cer of a regulated utility for employment with that utility or en a5liated intaest of the utility. Section 6(e) prohibits an 05cer of a public utility or a5liated interest from offering employment to any employeeofthe wmmission. whether any person has violated either of these provisionsis a fact question. Senate Bii 1 of the 72d Legislature adopted post-employment restrictions on the appearancebefore a regulatory agency by former state officers sod employees of that agency. These provisions, cod&d as section 7A of article 6252-9b, V.T.C.S.. do not apply to forma state 05cers or employeesiftheir represenWion of a person before a state agencyis restricted by other law. Smce section 6(j) of article 1446c. V.T.C.S., places post-employment restrictions on appearances b&e the PUC by its forma wmmissioners and employees, section 7A of article 6252~9b, V.T.C.S., does not apply to these individuals.

DAN MORALES Attorney Oenaal ofTexas
WILLPRYOR First Ass&ant Attorney General
MARYKELLER Deputy Attorney Oenaal for Litigation
RENBAHIcKs State Solicitor
MAD- B. JOHNSON Chair, Opiion Committee Prepamd by SusanL. Garrison At3shamAttorneyoulaal

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