HomeMy WebLinkAboutMinutes - Ethics Review Board - 07/26/1994 -r
MINUTES
ETHICS REVIEW BOARD MEETING
July 26,1994 at 12:15 p.m.
Second floor Conference Room
City Hall West
The Board convened on the above date at 12:15 p.m.in the second floor conference room in
City Hall West to discuss the following question which had been presented by Councilmember
Gina Janett:
Whether any members of the Affordable Housing Board may have a conflict of
interest in participating in recommendations to the City Council about alternative
funding programs for affordable housing projects.
In attendance were Ethics Review Board members Ann Azari,
McCluskey;Councilmember and Affordable Housing Board Liaison
Housing Board members Christa Sarrazin,
Mary Cosgrove,Tom Sibbald and Bob Browning;Chief Planner Ken
Mike Ludwig;and City Attorney Steve Roy.
The Board discussed the question referenced above,as well as
opinions that had been rendered regarding similar questions.
opinion and directed the City Attorney to prepare a draft of the
and presentation to the City Council.(A final draft of said
incorporated herein.)
The meeting was adjourned at approximately 1:00 p.m.
Gerry Horak and Bob
Gina Janett;Affordable
Anne Sanders,
Waido and City Planner
previous Ethics Review Board
The Board then rendered its
opinion for the Board’s review
opinion is attached hereto and
J
Stephe 3.Roy,City Atto’ey
r
94-1
OPINION OF THE ETHICS REVIEW BOARD
OF THE CITY COUNCIL OF THE CITY OF FORT COLLINS
July 26,1994
The Ethics Review Board met on the above-referenced date to address a question presented by
Councilmember Gina Janett,liaison to the Affordable Housing Board (“the Board”).In
attendance were Ethics Review Board members Ann Azari,Bob McCluskey and Gerry Horak,
as well as Councilmember Janett and several members of the Board.The question presented to
the Ethics Review Board was the following:
Whether any members of the Affordable Housing Board (by reason of their involvement
in particular affordable housing projects)may have a conflict of interest in participating
in recommendations to the City Council about a funding program for which their projects
might be eligible.
BACKGROUND INFORMATION
On June 28,1994,the City Council met at a work session with the Board to discuss,among
other things,alternative proposals for disbursing monies from the City’s Affordable Housing
Fund (“the Fund”).The Board then met on July 7,1994,to discuss those alternatives.During
the course of that meeting,the Board formulated a recommendation to the Council,which is
scheduled for Council’s consideration at its regular meeting on August 16,1994.The Board’s
recommendation is that $133,000 be appropriated from the Fund to be used to provide rebates,
ranging in amounts from $2,100 to $4,200,to affordable housing projects that meet certain
criteria.
CHARTER PROVISIONS
Under Article IV,Section 9,of the City Charter,officers and employees of the City are
prohibited from “voting on,attempting to influence or otherwise participating in”(as an officer
or employee)any decision in which he or she has a personal or financial interest.Under such
circumstances,the officer or employee must file a conflict of interest disclosure statement with
the City Clerk.
A financial interest is defined as “any interest equated with money or its equivalent.”Financial
interest does not include either of the following:
(1)The interest of an employee of a business,or a holder of an ownership
interest in such business,in a decision of any public body,when the
decision financially benefits or otherwise affects such business but entails
no foreseeable,measurable financial benefit to the employee or interest
holder
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Ethics Opinion 94-1
July 26,1994
Page 2
(2)The interest of a nonsa]aried officer or member of a nonprofit corporation
or association or of an educational,religious,charitable,fraternal or civic
organization in the holdings of such corporation,association or
organization;..(City Charter,Section 9{aJ.)
A personal interest is defined as follows:
any interest (other than a financial interest)arising from blood or marriage
relationships or from close business,political or personal associations or concerns
which would,in the judgment of a reasonably prudent person,tend to impair
independence of judgment or action in the performance of official discretionary
duties.(City Charter,Section 9[aJ.)
RELEVANT CODE PROVISIONS
The Affordable Housing Board was created by Ordinance No.84,1993.The Board consists
of nine members appointed by the City Council.Those members,as required by Section 2-82
of the City Code,possess expertise in affordable housing issues,including,without limitation,
issues pertaining to development,finance,lending,charitable and low income services and
general community issues.
The duties and functions of the Board,as described in Section 2-83 of the Code,are as follows:
(I)To advise the Council on all matters pertaining to affordable housing
issues of concern to the city;
(2)To aid and guide the development of city-wide affordable housing
programs to address currently existing and potential affordable housing
issues;
(3)To promote citizen participation and public education on city-wide
affordable housing issues;
(4)To be aware of and coordinate with the various other city boards and
commissions whose actions may affect affordable housing in the
community;and
(5)To perform other such duties and functions and have other powers as
provided by the Council.
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Ethics Opinion 94-1
July 26,1994
Page 3
A N A LYS IS:
1.Overview.
All members of City boards and commissions run the risk of encountering situations that entail
potential conflicts of interest,because they are generally appointed to a particular board by
reason of the fact that they have some experience or expertise in the Board’s area of interest.
This can often mean that their employment situation or other personal or professional
associations may require them to refrain from participating in a particular decision of the board.
With regard to the Affordable Housing Board,the risk of a conflict of interest may be greater
than usual.This is because one of the Board’s functions is to “aid and guide the development
of city-wide affordable housing programs.”In performing this function,it is predictable (and
perhaps unavoidable)that the Board will be called upon to make specific recommendations to
the Council abou,t ways in which financial assistance might be given to affordable housing
projects.This conflict of interest question arises because many of the Board members are
involved,in one capacity or another,with projects that could,either immediately or in the
foreseeable future,seek funding assistance from the program which is they subject of their
recommendation.
2.Financial Interest.
The first question to be addressed by the Ethics Review Board is whether any members of the
Affordable Housing Board may have a financial interest in participating in recommendations
about funding programs for affordable housing projects by reason of their own involvement with
particular projects.In applying the definition of financial interest contained in the Charter,the
Ethics Review Board does not believe that Board members who are placed in this position do
have a financial conflict of interest.This is because the recommendations of the Board are also
accompanied by staff recommendations and,ultimately,the decision whether to adopt the criteria
is a decision to be made by the City Council rather than the Board.Thus,the Board’s
recommendation is only one factor in one step along the way in determining the kind of program
that will be made available for affordable housing projects and the criteria that will be
established to determine the eligibility of particular projects.Therefore,within the meaning of
the Charter provision,the Board’s recommendation to the Council on this subject is sufficiently
removed from the actual award of any funding that it does not entail any measurable financial
benefit to any member of the Board.
3.Personal Interest.
A closer question is presented by the personal interest standard in the City Charter.Obviously,
all members of the Board have a strong interest in the subject of affordable housing.Otherwise,
they would not have been considered to be qualified for service on the Board.The Charter
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Ethics Opinion 94-1
July 26,1994
Page 4
prohibition,however,is directed toward a more particular kind of personai interest,that is,an
interest in a particular agency or organization or project which might,in the judgment of a
reasonably prudent person,interfere with that Board member’s independence of judgment in
formulating a recommendation to the Council about funding programs for affordable housing
projects.
In Opinion 93-3,the Ethics Review Board has previously articulated the following factors which
should be considered in determining whether a personal interest exists:
•The extent to which the decision in question “focuses’on the individual officer
or employee.
•The magnitude of the potential financial or personal impact of the decision on the
individual officer or employee.
•The need for the officer or employee to participate in the decision.
In applying these criteria to the situation at hand,the formulation of eligibility criteria for
affordable housing applicants is not focused on any individual Board member.Instead,the
Board members are part of a larger class of individuals in various professions who are interested
in the subject of affordable housing,some of whom may potentially be applicants for funding.
The criteria recommended by the Board for Council consideration are very general in nature,
and none of them guarantee the eligibility of any particular affordable housing project.
As to the second factor to be considered,it is unlikely that the establishment of the criteria will
have a substantial impact on the personal circumstance of any individual Board member.
As to the third factor,because of the particular expertise and various perspectives represented
by each member of the Board,there is a strong need for Board members to be able to participate
in the formulation of eligibility criteria for affordable housing projects.Absent the benefit of
the special expertise of the members of the Board,the Council would be left without an
invaluable source of information as to the kinds of programs that might effectively attract
affordable housing projects.
In the balance,the Ethics Review Board does not believe that any member of the Affordable
Housing Board should be ineligible to participate in discussions and recommendations about
affordable housing programs,including recommendations concerning eligibility criteria for
applicants.Board members should be aware,however,of the potential for a personal or
financial conflict of interest as the decisions of the City become more focused on individual
applicants.At such time as any decisions are made about the award of funds to individual
agencies,those Board members who have a financial or personal interest in particular projects
that may seek funding from the City should refrain from participating.Each Board member
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Ethics Opinion 94-1
July 26,1994
Page 5
should continue to carefully assess his or her own circumstance on a case-by-case basis in
determining the point in the decision-making process when a conflict of interest may exist.
Board members are encouraged to seek the advice of the City Attorney’s office in making that
determination,and additional questions of conflict of interest with regard to this matter can be
submitted to the Ethics Review Board for a subsequent opinion and recommendation.
This advisory opinion was reviewed and approved by Mayor Azari,Mayor Pro Tern Horak and
Councilmember Bob McCluskey,regular members of the Ethics Review Board.Pursuant to
Section 2-569(e)of the City Code,this opinion and recommendation is to be immediately filed
with the City Clerk and made available for public inspection.Additionally,this opinion and
recommendation shall be placed on the agenda for the next meeting of the City Council on
August 2,1994.
Dated this 27th da of July,1994.
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~tephe~oy,/City Attor~
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