Filing Number: 06-10
Subject: Charitable Fundraising
Keywords: appearance of impropriety, conflict, County official, Executive Office, impropriety, non-profit, official business, representation, solicitation
Decision By: Commissioners: John McMahon, Kathryn Denhardt, Eugene McCoy, Ernest Price, James R. Soles
Contact Email: admin@nccethics.org
 
Status: Active

Question:

            An Executive branch official requests an opinion about whether County officials violate the Ethics Code if they play a leadership role in a charitable fund raising campaign that solicits contributions from County employees and appointed officials.

Conclusion:

            An official who chairs a section of a charity's fundraising campaign has a private interest in the charity different from the County's interest as a participating employer assisting in raising funds for the charity. When performing as a chairperson for the charity, the official may not use County time or County resources, solicit County employees or officials to volunteer for the campaign or contribute to it without violating the conflict of interest provision of the Code of Ethics. However, County officials and employees who do not have a similar functional position with the charity who volunteer to assist the County government employer in the portion of the campaign it sponsors may solicit in a non-coercive manner among employees provided they do not personally solicit their subordinates.

Facts:

            A senior official plans to chair a section of a charity's campaign which raises funds from local government entities. Other highly placed officials plan to assist in the fundraising among County government employees and officials as part of the County's performance as a participating employer. County government solicitation efforts will be primarily in written form and through group meetings. The responses from the individual County employees and officials will not be seen by the official chairing the local government section or those assisting in the County sponsored campaign.

Code or Prior Opinion:

Code provisions
 
            The conflict of interest rules at Code Section 2.03.103(A)(1) restrict the use of official authority by a County official or employee "for the personal or private benefit of himself or herself, a member of his or her immediate family or a business with which he or she is associated."1 Section 2.03.103(B)(2) prohibits County officials and employees from representing the interests of a private enterprise in any matter before the County.2 Additionally, the Code's conduct rule at Section 2.03.104 (D) prohibits County employees and officials from using their status as public officers to obtain unwarranted privileges or gain.3
 
            Newly enacted Code Section 2.03.103(J)(3), approved by Council on March 28, 2006, signed into law on April 3, 2006, permits elected officials to set office-wide, non-coercive solicitation policies intended to benefit charitable entities or events if the policy does not create a conflict of interest or appearance of impropriety and does not violate the rule of subsection (J)(2) against personal solicitation of donations by County officials and County employees from subordinates.4
 
Commission precedent and other authorities
 
            Past interpretations of the Code of Ethics have permitted solicitation activities by County employees under restricted circumstances but the Commission precedent predates the newly enacted law found at Section 2.03.104 (J), which prohibits solicitation of subordinates. Unlike this case, the majority of those opinions relate to situations in which the official or employee is seeking donations for private charitable enterprises which have no County government sponsorship.
 
            However, Order 03-03 stemmed from an investigation of whether a County Official violated the Code when he exercised official authority to make a grant for a non-profit agency in which he was a member of the corporate board of directors. In that Order the Commission reviewed a number of prior opinions and determined that if an employee or official's County position figures prominently in the person's status with the non-profit there is a potential for improper appearance in fundraising for the private entity. In the Order the Commission quoted an Opinion from Anne Arundel County, Maryland, Ethics Commission on a similar question involving an official's board participation. The Maryland Commission found that an official could participate on a board of a charity as long as he avoided "duties involving management or control . . . or where he would be viewed as a responsible party as to its financial relationships . . . ."5 As a government employee, he had an obligation to draw a clear line for the public between his official status and his private status and not use the former to assist the latter.
 
            A more relevant opinion was issued by the Alaska Attorney General's Office concerning a government sponsored United Way campaign, 2003 WL 22701377 (Alaska A.G.). That opinion found that solicitation of truly voluntary service or contributions to the United Way campaign from government employees was not precluded as long as employees who were board members of United Way were not assigned to be coordinators or key workers and did not otherwise solicit general contributions from other government employees on government time or with government resources. The opinion reasoned that since Alaska law (like New Castle County's) prohibited a state employee from using an official position for personal gain, if the volunteer employee or his or her immediate family member, was on the board of United Way or a member of a charitable organization which could benefit in the United Way campaign, the employee had a prohibited personal interest in the outcome of the campaign and could not use his or her government position, government time or government resources to solicit for United Way.6 The opinion found that volunteer coordinators and key workers for the State sponsored portion of the campaign who were true volunteers had no similar personal interest in or function with the charities and could properly use government time and resources because they were pursing the government's interest in its role as a participating employer in the United Way campaign.7

Analysis:

            The Commission is persuaded by the language of the prohibitions in New Castle County Ethics Code at Sections 2.03.103(A)(1), 2.03.103(B)(2), 2.03.104 (D) regarding conflicts of interest and representation of private interests that the senior County official who intends to chair a section of the charity's fundraising campaign is the equivalent of the United Way board member described in the Alaska opinion and must be viewed as a responsible party for the charity's financial relationships. That official has a personal stake in the outcome of the campaign different from that of County government as sponsoring employer. The Commission is also persuaded by the logic of the Alaska Opinion that if the senior executive uses County time and resources to solicit County employees he will be advancing his private interest in the charity, not the employer's and would violate the conflict of interest and representation provisions of the Code.
 
            Other officials who volunteer to assist their County employer in the County sponsored portion of the campaign but who do not function in any other capacity with the charity will not violate the Code as long as they use non-coercive means to advance the campaign and do not perform personal solicitations of their subordinates in violation of Sec. 2.03.104(J)(2).

Finding:

In issuing this Advisory Opinion, the Ethics Commission is applying the New Castle County Code of Ethics, which establishes the minimum level of ethical conduct required of County officials and employees. The Commission reminds each County elected official that he or she has authority to impose as part of his or her own policy additional or greater restrictions on subordinate officials and employees than those set forth in this Opinion. See, Section 2.03.101(D).
 
            BY AND FOR THE NEW CASTLE COUNTY ETHICS COMMISSION ON THIS 14TH DAY OF JUNE, 2006.
 
                                                             
John McMahon, Chairperson
 
Decision:  Unanimous

Footnotes:

1 Section 2.03.103. Prohibitions relating to conflicts of interest, states in pertinent part:
(A.) Restrictions on exercise of official authority.
1. No County employee or official knowingly or willfully shall use the authority of his or her office or employment or any confidential information received through his or her holding County office or employment for the personal or private benefit of himself or herself, a member of his or her immediate family or a business with which he or she is associated. This prohibition does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the County official or employee, a member of his or her immediate family or a business with which he or she or a member of his or her immediate family is associated. There will be a rebuttable presumption of a knowing or willful violation of this section if the action benefits the County official or employee, his or her spouse, or his or her dependent children (whether by blood or by law).

2 Sec. 2.03.103. Prohibitions relating to conflicts of interest, states in pertinent part:
(B.) Restrictions on representing another's interest before the County.
. . .
2. No County official may represent or otherwise assist any private enterprise with respect to any matter before the County. This prohibition is to be considered personal to the County official and is not, for the purposes of the New Castle County Ethics Code only deemed to impact other members of a firm, business, or other employer by which the County official is employed.

32. Sec. 2.03.104. Code of conduct, states in pertinent part:
. . .
(D.) No county employee or County official shall use such public office to secure unwarranted privileges, private advancement or gain.
. . .

4 Ordinance 06-022, added Sec. 2.03.104 (J), Solicitation, to the Ethics Code and states in pertinent part:
. . .
(2) Personal solicitation of donations by County officials and County employees, or by their agents, spouses or minor children, from subordinates of the county official or employee is prohibited.
(3) Elected Officials may set office-wide, non-coercive solicitation policies intended to benefit charitable entities or events if the policy does not create a conflict of interest or appearance of impropriety and does not violate subsection J(2).
            Ordinance 06-022 added new definitions to Section 2.03.102 and added Sections 2.034.104 (H), (I), and (J) to the New Castle County Code. It has been described as not as stringent as State law by the Public Integrity Commission because the State law contains no provisions referencing solicitation of any nature and in prior Opinions the Public Integrity Commission has prohibited any form of solicitation by State agencies without express General Assembly authorization. The County Ethics Commission has requested reconsideration of that finding as applied to County government.

5 Anne Arundel County Advisory Opinion 96-109.

6 The opinion found, however, that with prior approval of the "ethics supervisor", the employee/board member could make occasional and insignificant use of government time and resources to pursue other United Way interests if he first received authorization from the "ethics supervisor" and kept the use within the parameters set by the supervisor.

7 The opinion defined "personal interest" as "an interest held or involvement by a public officer or the officer's immediate family member or parent, including membership, in any organization, whether fraternal, nonprofit, for profit, charitable, or political, from which, or as a result of which, a person or organization receives a benefit."