Source: https://www.ag.state.mi.us/opinion/datafiles/1990s/op06721.htm
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Opinion #6721
Opinion No. 6721
Member of State Survey and Remonumentation Commission--Contracts with the Commission or counties receiving grants from the Commission
A member of the State Survey and Remonumentation Commission would be in a substantial conflict of interest in violation of Const1963, art 4, Sec. 10, and 1968 PA 318, if the member, or a business entity with which the member is associated, were to enter into a contract with the Commission for monumentation or remonumentation services.
A member of the State Survey and Remonumentation Commission would not be in a conflict of interest in violation of Const1963, art 4, Sec. 10, or 1968 PA 318, if the member were to participate in the approval of a grant by the Commission to a county with which the member, or a business entity with which the member is associated, may subsequently contract to provide services to the county which would be paid for with grant funds.
A member of the State Survey and Remonumentation Commission would not be in a prohibited conflict of interest in violation of Const1963, art 4, Sec. 10, or 1968 PA 318, if the member, or a business entity with which the member is associated, were to contract with a county and the county were to pay for the services rendered under the contract with funds granted to it by the Commission.
Mr. Larry Gerschbacher
Chairman, State Survey and Remonumentation Commission
116 West Allegan Street
You have asked several questions relating to possible conflicts of interests concerning actions which may be taken by members of the State Survey and Remonumentation Commission (Commission) who are also licensed land surveyors.
Section 3 of the State Survey and Remonumentation Act (the Act), 1990 PA 345, MCL 54.261 et seq; MSA 5.1035(261) et seq, established the Commission composed of five members, four of whom shall be licensed land surveyors. Under section 6 of the Act, the Commission is charged with restoration, maintenance and preservation of land survey records of vertical and horizontal monuments. Monuments consist of corners which are marked to "serve as the basis for all public and private property locations, including practically all privately owned parcels (of land), farms, and homes, plus thousands of miles of publicly owned roads, highways, utility lines, railroads and other public works." Senate Legislative Analysis, SB 380, June 21, 1990. Because monuments marking corners disappear or deteriorate, "property surveys have become more difficult, disputes more common, and surveys more expensive." Id.
Pursuant to section 10(1) of the Act, monumentation or remonumentation may be conducted by the Commission "pursuant to negotiated contracts" and the Commission is charged with the responsibility to "monitor the field work and notes of all work done under each contract to ensure compliance with (the) specifications" prepared by the Commission.
Section 8 of the Act requires counties to establish a county monumentation and remonumentation plan, including a perpetual monument maintenance plan requiring all corners to be checked and, where necessary, remonumentated at least once every twenty years, subject to approval by the Commission. To assist counties in performing these duties, the Commission is authorized to make annual grants to the counties from the state survey and remonumentation fund under sections 11 and 12 of the Act. Monies in the fund represent the collection by the county registers of deeds of the fee of $2.00 for entering and recording any instruments left for recording. MCL 600.2567 and 600.2567a; MSA 27A.2567 and 27A.2567(1).
Your questions will be addressed separately against this background. Your first question may be stated as follows:
Would a member of the State Survey and Remonumentation Commission be in a prohibited conflict of interest in violation of Const1963, art 4, Sec. 10, or 1968 PA 318, if the member, or a business entity with which the member is associated, were to enter into a contract with the Commission?
Const1963, art 4, Sec. 10, provides:
1968 PA 318, MCL 15.301 et seq; MSA 4.1700(21) et seq, implements Const1963, art 4, Sec. 10. In defining the term "substantial conflict of interest" in section 4(b)(iv) of 1968 PA 318, the Legislature has provided that there is no substantial conflict of interest:
[I]f the legislator or state officer does not solicit the contract, takes no part in the negotiations for or in the approval of the contract or any amendment thereto, and does not in any way represent either party in the transaction and if the contract is not with or authorized by the department or agency of the state or a political subdivision thereof with which the state officer is connected. [ Emphasis added.]
This statutory provision fairly explicates Const1963, art 4, Sec. 10. OAG, 1973-1974, No 4799, p 116 (February 1, 1974).
Members of the State Survey and Remonumentation Commission are state officers within the purview of Const1963, art 4, Sec. 10, and 1968 PA 318. See OAG, 1973-1974, No 4799, p 119, supra.
Const1963, art 4, Sec. 10, as explicated by section 4(b)(iv) of 1968 PA 318, declares a substantial conflict of interest if a state officer or a business entity with which the state officer is associated enters into a contract with the state commission upon which the state officer serves. OAG, 1983-1984, No 6211, p 246, 254-256 (March 21, 1984); OAG, 1979-1980, No 5689, p 732, 733 (April 22, 1980).
Since section 10 of the Act imposes a duty upon members of the Commission to negotiate contracts for monumentation or remonumentation and any such contract would be with the Commission, a member of the State Survey and Remonumentation Commission would be in a substantial conflict of interest prohibited by Const1963, art 4, Sec. 10, as implemented by section 4(b)(iv) of 1968 PA 318, if the member, or a business entity with which the member is associated, were to enter into a contract with the Commission for monumentation or remonumentation services.
It is my opinion, therefore, in answer to your first question, that a member of the State Survey and Remonumentation Commission would be in a substantial conflict of interest in violation of Const1963, art 4, Sec. 10, and 1968 PA 318, if the member, or a business entity with which the member is associated, were to enter into a contract with the Commission for monumentation or remonumentation services.
Would a member of the Commission be in a prohibited conflict of interest in violation of Const1963, art 4, Sec. 10, or 1968 PA 318, if the member were to participate in the approval of a grant by the Commission to a county with which the member, or a business entity with which the member is associated, may subsequently contract to provide services to the county which would be paid for with grant funds?
Pursuant to sections 12, 13 and 14 of the Act, the Legislature has empowered the Commission to make grants to counties to implement plans for monumentation or remonumentation, approved by the Commission, in the respective counties.
There is some authority for the proposition that grants have some aspects of a contract, Pennhurst State School & Hospital v Halderman, 451 US 1, 17; 101 SCt 1531, 67 LEd2d 694 (1981); Bennett v New Jersey, 470 US 632, 638; 105 SCt 1555; 84 LEd2d 572 (1985), subject, of course, to the terms and conditions of the statute and promulgated rules under which the grants are made. Assuming arguendo that the grant to a county has some aspects of a contract, section 4(c) of 1968 PA 318, provides that there shall be deemed to be no conflict of interest which is substantial in a contract between the state and a political subdivision of the state such as a county.
Sound public policy requires, however, that a member of the Commission who has reason to believe that the member, or a business entity with which the member is associated, may subsequently contract to provide services to the county which would be paid for with grant funds, disclose that interest when voting on whether the grant should be made to that county. OAG, 1987-1988, No 6468, p 197, 199 (September 29, 1987).
It is my opinion, therefore, in answer to your second question, that a member of the State Survey and Remonumentation Commission would not be in a conflict of interest in violation of Const1963, art 4, Sec. 10, or 1968 PA 318, if the member were to participate in the approval of a grant by the Commission to a county with which the member, or a business entity with which the member is associated, may subsequently contract to provide services to the county which would be paid for with grant funds.
Would a member of the State Survey and Remonumentation Commission be in a prohibited conflict of interest in violation of Const1963, art 4, Sec. 10, or 1968 PA 318, if the member, or a business entity with which the member is associated, were to contract with a county and the county were to pay for the services rendered under the contract with funds granted to it by the Commission?
By their plain terms both Const1963, art 4, Sec. 10, and 1968 PA 318, prohibit state officers from having an interest in a contract with any political subdivision which shall cause a substantial conflict of interest. Const1963, art 4, Sec. 10, as implemented by section 4(b)(iv) of 1968 PA 318, declares a substantial conflict of interest if a state officer, or a business entity with which the state officer is associated, enters into a contract with a state commission upon which the state officer serves. OAG, 1983-1984, No 6211, supra; OAG, 1979-1980, No 5689, supra. Since the member of the Commission is not an officer of the contracting county, and has no public duty to act on behalf of the contracting county, there is no violation of either Const1963, art 4, Sec. 10, or 1968 PA 318, if the member of the Commission, or a business entity with which the member is associated, were to contract with a county and the county were to pay for the services rendered under the contract with funds granted to it by the Commission. OAG, 1983-1984, No 6211, pp 255-256, supra.
It is my opinion, therefore, in answer to your third question, that a member of the State Survey and Remonumentation Commission would not be in a prohibited conflict of interest in violation of Const1963, art 4, Sec. 10, or 1968 PA 318, if the member, or a business entity with which the member is associated, were to contract with a county and the county were to pay for the services rendered under the contract with funds granted to it by the Commission.
Finally, it must be observed that the Commission is authorized to review and approve county monumentation and remonumentation plans, to make, withhold, or revoke grants made to counties, and to approve changes in county plans. See sections 8 and 15 of the Act. Because of these powers and duties, the state board of ethics act, MCL 15.341 et seq; MSA 4.1700(71) et seq, may bear upon your question. Section 2(6) of that statute prohibits officers, including members of the Commission, from accepting employment from or rendering services for a public interest that is incompatible with the discharge of official duties or may "tend to impair his or her independence of judgment or action in the performance of official duties." Questions whether such a contract with a county would violate the state board of ethics act may be addressed to the Board of Ethics which is empowered to render advisory opinions on questions directed to it under section 5 of that act.