Source: http://www.ct.gov/ethics/cwp/view.asp?a=2305&q=416490
Timestamp: 2017-12-13 20:41:37
Document Index: 503390133

Matched Legal Cases: ['§ 1', '§ 1', '§ 1', '§ 1', '§ 1', '§ 1', '§ 10', '§ 1', '§ 1', '§ 1', '§ 1']

Ethics: 2008-3
ADVISORY OPINION 2008-3
Application of the Code of Ethics for Public Officials to members of the
<?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Connecticut Health and Educational Facilities Authority Board
The Citizen’s Ethics Advisory Board issues this advisory opinion at the request of Jeffrey A. Asher, ethics liaison for the Connecticut Health and Educational Facilities Authority (“CHEFA”). In that request, Mr. Asher asks several questions concerning a CHEFA board member’s acquisition of CHEFA-issued bonds.
CHEFA is a quasi-public agency.[1] Its board members are considered public officials subject to the Code of Ethics for Public Officials (“Code of Ethics”).[2]
As noted on CHEFA’s website:
The Connecticut Health and Educational Facilities Authority provides Connecticut's nonprofit institutions access to low cost financing in the public municipal markets. Formed in 1965, CHEFA currently has in excess of $6.3 billion in bonds outstanding. Hospitals, institutions of higher education, independent schools, childcare providers, cultural institutions, and human service providers have benefited from financing through CHEFA to expand their physical plant and equipment and increase services to their clients. . . . The Authority's operations do not rely upon any State appropriation either from the General Fund or from bond funds. CHEFA generates revenue from fees on its portfolio of bonds and investment income and controls expenses often generating a surplus that it reinvests back into the State.
CHEFA-issued bonds may be accessed or purchased by any member of the general public. Once bonds have been issued for a particular institution, the CHEFA board generally takes no further action with regard to that bond. The board may be required to take action on subsequent bond issues for the same institution.
CHEFA’s Code of Conduct prohibits direct ownership by any CHEFA board or staff member of a bond issued by CHEFA. A particular member of the CHEFA board inadvertently acquired certain CHEFA bonds. Specifically, the board member’s broker acquired the bonds on the board member’s behalf on April 16, 2007, and on August 17, 2007. The board member only became aware of this acquisition upon completing his 2007 Statement of Financial Interests.[3] Immediate disposal would result in a loss of approximately $26,000 to the board member. He has, therefore, requested a reasonable period of time—not to exceed twelve months—to dispose of the bonds. The board member has agreed not to participate in any matters involving the bonds or the entities on whose behalf the bonds were issued.
1. Whether a CHEFA board member’s possession of CHEFA-issued bonds violates the Code of Ethics.
2. Whether a CHEFA board member’s possession of CHEFA-issued bonds violates CHEFA’s enabling statute.[4]
3. Whether the CHEFA board member’s continued possession of CHEFA-issued bonds for the following twelve months violates the Code of Ethics.
4. Whether the CHEFA board member’s continued possession of CHEFA-issued bonds for the following twelve months violates CHEFA’s Code of Conduct.
The first question (i.e., whether a CHEFA board member’s possession of CHEFA-issued bonds violates the Code of Ethics) is answered in the negative. Pursuant to the Code of Ethics, “no public official or state employee shall use his public office or position or any confidential information received through his holding such public office or position to obtain financial gain for himself, his spouse, child, child's spouse, parent, brother or sister or a business with which he is associated.”[5] The board member did not “use his public office or position” or any confidential information gained therein to obtain said bonds because: (1) the board member’s broker acquired the bonds on the board member’s behalf without the board member’s knowledge; (2) CHEFA-issued bonds may be accessed or purchased by any member of the general public in the same manner as it was acquired by the board member’s broker; and (3) the board member would receive no greater benefit than any other bond purchaser. Absent any use of office for financial gain, neither the bonds’ acquisition nor their possession constitutes a violation of the Code of Ethics.
The second question is whether a CHEFA board member’s possession of CHEFA-issued bonds violates CHEFA’s enabling statute.
It is beyond this Board’s statutory authority to analyze and interpret CHEFA’s enabling statute. The Citizen's Ethics Advisory Board only has specific authority to issue Advisory Opinions regarding Part I, The Code of Ethics for Public Officials, and Part II, The Code of Ethics for Lobbyists.[6] We will not, therefore, render advice as to whether a CHEFA board member’s possession of CHEFA-issued bonds violates CHEFA’s enabling statute.
The third question (i.e., whether the CHEFA board member’s continued possession of CHEFA-issued bonds for the following twelve months violates the Code of Ethics) is also answered in the negative. The Code of Ethics is not triggered by the board member’s continued possession provided that neither the bonds nor the entities on whose behalf the bonds were issued require further action from CHEFA. If further action is required, there are two conflict of interest provisions, one for substantial conflicts[7] and one for potential conflicts,[8] that may apply.
In a situation when an issue arises requiring the board to take further action with regard to the bonds or the entities on whose behalf the bonds were issued, the board member facing either a substantial or potential conflict shall recuse himself or herself from the matter at hand and file a written statement mandated by General Statutes § 1-86 (a). Pursuant to procedure outlined under § 1-86 (a), the board member must sign the written statement under penalty of false statement describing the matter requiring action and the nature of the conflict and must deliver a copy of such statement to his or her chairperson or to the Office of State Ethics.
As was the case with the second question, question number four (i.e., whether the CHEFA board member’s continued possession of CHEFA-issued bonds for the following twelve months violates CHEFA’s Code of Conduct) is beyond the scope of this Board’s authority. It is the position of the Office of State Ethics that it is permissible for agencies to adopt their own, more restrictive ethics policies. This stance is similar to that taken by the former State Ethics Commission.[9]
It is entirely appropriate for CHEFA’s ethics policy to contain rules that are more restrictive than the Code of Ethics in order to avoid even the appearance of a conflict of interest. Nonetheless, the Citizen's Ethics Advisory Board does not interpret and is without authority to enforce other agencies’ ethics policies.
It is the opinion of the Citizen's Ethics Advisory Board that:
1. Absent any “use of office for financial gain,” neither this CHEFA board member’s previous, unknowing acquisition, nor his possession of CHEFA-issued bonds, constitutes a violation of the Code of Ethics.
2. It is beyond this Board’s statutory authority to analyze and interpret CHEFA’s enabling statute. The Citizen's Ethics Advisory Board will therefore not opine as to whether a CHEFA board member’s possession of CHEFA-issued bonds violates CHEFA’s enabling statute.
3. The Code of Ethics is not triggered by the board member’s continued possession provided that neither the bonds nor the entities on whose behalf the bonds were issued require further action from CHEFA. In the case that an issue arises requiring the board to take further action with regard to the bonds or the entities on whose behalf the bonds were issued, the board member shall recuse himself or herself from the matter at issue and file a written statement as mandated by General Statutes § 1-86 (a).
4. While it is entirely appropriate for CHEFA’s ethics policy to contain rules that are more restrictive than the Code of Ethics, the Citizen's Ethics Advisory Board does not interpret or enforce other agencies’ ethics policies. The Citizen's Ethics Advisory Board will therefore not opine as to whether a CHEFA board member’s possession of CHEFA-issued bonds violates CHEFA’s Code of Conduct.
Dated May 29, 2008
[1]General Statutes § 1-79 (l).
[2]General Statutes § 1-79 (k).
[3]Pursuant to General Statutes § 1-83, certain public officials must file a Statement of Financial Interests with the Office of State Ethics which includes, in pertinent part, information about the officials’ “securities in excess of five thousand dollars at fair market value owned by such individual, spouse or dependent children or held in the name of a corporation, partnership or trust for the benefit of such individual, spouse or dependent children . . . .”
[4]CHEFA’s enabling statute reads: “Notwithstanding any other law to the contrary, it shall not be or constitute a conflict of interest for a trustee, director, officer or employee of an institution for higher education or a health care institution, or for any person having a financial interest in such an institution, to serve as a member of the board of directors of the authority; provided such trustee, director, officer, employee or person shall abstain from deliberation, action and vote by the board under this chapter in specific respect to the institution for higher education or the health care institution of which such member is a trustee, director, officer or employee or in which such member has a financial interest.” General Statutes § 10a-179 (g).
[5]General Statutes § 1-84 (c).
[6]General Statutes §§ 1-81 (a) (3) and 1-92 (e).
[7]“A public official, including an elected state official, or state employee has an interest which is in substantial conflict with the proper discharge of his duties or employment in the public interest and of his responsibilities as prescribed in the laws of this state, if he has reason to believe or expect that he, his spouse, a dependent child, or a business with which he is associated will derive a direct monetary gain or suffer a direct monetary loss, as the case may be, by reason of his official activity. A public official, including an elected state official, or state employee does not have an interest which is in substantial conflict with the proper discharge of his duties in the public interest and of his responsibilities as prescribed by the laws of this state, if any benefit or detriment accrues to him, his spouse, a dependent child, or a business with which he, his spouse or such dependent child is associated as a member of a profession, occupation or group to no greater extent than any other member of such profession, occupation or group. A public official, including an elected state official or state employee who has a substantial conflict may not take official action on the matter.” General Statutes § 1-85.
[8]“Any public official or state employee, other than an elected state official, who, in the discharge of such official's or employee's official duties, would be required to take an action that would affect a financial interest of such official or employee, such official's or employee's spouse, parent, brother, sister, child or the spouse of a child or a business with which such official or employee is associated, other than an interest of a de minimis nature, an interest that is not distinct from that of a substantial segment of the general public or an interest in substantial conflict with the performance of official duties as defined in section 1-85 has a potential conflict of interest. Under such circumstances, such official or employee shall, if such official or employee is a member of a state regulatory agency, either excuse himself or herself from the matter or prepare a written statement signed under penalty of false statement describing the matter requiring action and the nature of the potential conflict and explaining why despite the potential conflict, such official or employee is able to vote and otherwise participate fairly, objectively and in the public interest. Such public official or state employee shall deliver a copy of the statement to the Office of State Ethics and enter a copy of the statement in the journal or minutes of the agency. If such official or employee is not a member of a state regulatory agency, such official or employee shall, in the case of either a substantial or potential conflict, prepare a written statement signed under penalty of false statement describing the matter requiring action and the nature of the conflict and deliver a copy of the statement to such official's or employee's immediate superior, if any, who shall assign the matter to another employee, or if such official or employee has no immediate superior, such official or employee shall take such steps as the Office of State Ethics shall prescribe or advise.” General Statutes § 1-86 (a).
[9]See, e.g., Advisory Opinion No. 2000-17 (“DCP is not precluded . . . from establishing additional personnel policies for its employees including a ban on recreational gambling, should it determine that such a policy or policies are appropriate”).
Content Last Modified on 6/2/2008 9:51:06 AM