HomeMy WebLinkAbout4.d. Conflict of InterestMEMORANDUM
TO:
ROSEMOUNT CITY COUNCIL
FROM:
MIKE MILES �X
DATE:
June 30, 1992_
RE:
CONFLICTS OF INTEREST
In response to the request of City Administrator Steve Jilk and
several members of the Rosemount City Council, the following is a
brief review of the law regarding potential conflicts of interest
involving members of the City Council. In addition to this
summary, copies of the applicable state statutes are attached for
your information.
The principal statute regarding conflicts of interest impacting on
members of the City Council is Minn. Stat. §10A.07. Essentially,
that provision states that if a local elected official in the
discharge of official duties would be required to take an action
that would substantially affect the officials direct or indirect
financial interest in a way greater than other persons of the same
profession or occupation, the local official must take the
following actions:
1. Prepare a written statement describing the proposed
action and potential conflict of interest;
2. Provide a copy of the statement to the Mayor; and
3. Abstain from taking action with respect to the specific
issue involved.
An example of a conflict of interest under this statute would be:
if you had a partial interest in a piece of real estate and a
decision proposed by the City Council would augment the value of
that real estate (i.e. rezoning, allowing for subdivision of the
property, etc.), you would be subject to the requirements of
§10A.07.
An example of a situation which does not entail a conflict of
interest would be: if as a council person you were to participate
in a decision to locate a new fire house in your neighborhood and
such decision might slightly benefit the value of your property
because of fire safety considerations but would also have a similar
effect on all other property owners within your neighborhood.
The other, more particularized prohibition found in state law x
appears in Minn. Stat. §471.87 and §471.88. Section 471.87
prohibits public officials from having a personal financial
1
interest in any sale, lease or contract in which that public
official will have decision making authority as part of his or her
official duty. There are numerous exceptions to this provision in
§471.88 (i.e. contracts involving designation of a bank, official
newspaper, contracts of a modest amount, etc.) and these exceptions
are set forth fully in the attached statutory materials.
In summary, state law simply says that you cannot use your official
position in order to receive a financial or personal benefit
different from other citizens.
Attachments
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-� RIGHTS, POWERS, DUTIES. § 471.87
471.87 Public officers, interest in contract; penalty
Except as authorized in section 471.88, a public officer who is
authorized to take part in any manner in making any sale, lease,
or contract in his official capacity shall not voluntarily have a
personal financial interest in that sale, lease, or contract or per-
sonally benefit financially therefrom. Every public officer who
violates this provison is guilty of a gross misdemeanor.
Laws 1951, c. 379, § 1. Amended by Laws 1955, c. 41, § 1.
471.88 Exceptions
Subdivision 1. The governing body of any port authority,
seaway port authority, town, school district, county, or city, by
unanimous vote, may contract for goods or services with an in-
terested officer of the governmental unit in any of the following
cases.
Subd. 2. In the designation of a bank or savings association
in which the officer is interested as an authorized depository for
public funds and as a source of borrowing, no restriction shall
apply to the deposit or borrowing of any funds or the designa-
tion of a depository by such authority or governmental unit in
any bank or savings association in which a member of an au-
thority or officer of a governmental unit shall have an interest
if such deposited funds are protected in accordance with chapter
118; provided, however, that any member or officer having such
an interest shall disclose that he is a director or employee of the
bank or savings association, which disclosure shall be entered
upon the minutes of the authority or governmental unit, such
disclosure shall be made when such bank or savings association
is first designated as a ,depository or as a source of borrowing,
or when such member or .officer is elected whichever is later,
and such disclosure shall serve as notice of such interest and
need not be made with each successive transaction;
Subd. 3. The designation of an official newspaper, or publi-
cation of official matters therein, in which the officer is inter-
ested when it is the only newspaper complying with statutory or
charter requirements relating to the designation or publication;
Subd. 4. A contract with a cooperative association of which
the officer is a shareholder or stockholder but not an officer or
manager;
Subd. 5. A contract for which competitive bids are not re-
quired by law and where the amount does not exceed $5,000
when the commodity or service contracted for is not otherwise
available in the affected governmental unit;
Subd. 6. A contract with a volunteer fire department for the
payment of compensation to its members or for the payment of
retirement benefits to these members;
Subd. 7. A contract with a municipal band for the payment
of compensation to its members;
Subd. 8. Contracts for goods or services when the considera-
tion does not exceed $5,000 in any year and the contracting gov-
ernmental unit has a population of less than 5,000;
Subd. 9. When a port authority commissioner is engaged in
or employed by a firm engaged in the business of importing or
§ 471.88 MUNICIPALITIES
exporting or general trade, it shall be lawful. for the authority to
do business with the commissioner or his employer provided that
in the fixing of any rates affecting shippers or users of the ter -
minal facility, said commissioner shall not vote thereon.
Subd. 10. When a seaway port authority commissioner is en-
gaged in or employed by a firm engaged in the business of im-
porting qr exporting or general trade, it shall be lawful for the
authority to do business with the commissioner or his employer
pirovided that in the fixing of any rates affecting shippers or
users of the terminal facility, said commissioner shall not take
part in the determination of, except to testify, nor vote thereon.
Subd. 11. When a commissioner of any public housing or
port authority is employed by a bank engaged in making loans
or performing trust services involving real or personal property
affected by any plan of such housing or port authority, no re-
striction shall apply to any such loans made or trust services
performed by said bank if the commissioner shall disclose the
nature of such loans or trust services of which he has personal
knowledge, which disclosure shall be entered upon the minutes
_of such authority.
471.89 MUNICIPAL RIGHTS, PONVERS, DUTIES 1 Z12 1213
or services could be obtained elsewhere. In case of an emergency when the Contract cannot Statutory city oblig
ann bc
Subd.
in advance, payment of the claims shall be authorized by a like resolution in AM"r some and shall not be liable for an
which the facts of the emergency are also stat ed.
the joint enterp rise of the statutor
Subd. 3. Claims, affidavits riled. Before such aclaim is paid, the interested officer shall
hospital.
davit statin
file with the clerk of the governing body an affidavit —3;
0 History: 1951 c 497 s I
me of the officer and the office held by the officer;
(a) The name - - - - - - - - - - J
(b) An itemization of the commodity or se rvices furnished; 471.91 AIR TRAVEL ACCOU'
(c) The contract price; Th governing governing body of any c
e
(d) The reasonable value; U first class is authorized to enter int
(e) The interest of the officer in the contrac t; and carrying passengers on schedule f]
a and belief the contract price is as low a, t accou for any such city C
(f) That to thebesrof the officer's knowled I M
nt
the commodity or services could be obtained from other necessary and proper to facilitat
lower than, the price at which
county, and t o deposit with the ai
sources.
such account.
History: 1951 c 379 s 3, 1965 c 45 s 64-66; 1967 c 125 s 1,2; 1978 c 651 s 2,3: !3`
History: 1951 c 630 s 1
1986 c 444
471.895 CERTAIN GIFTS BY INTERESTED PERSONS PROHIBITED. 471.92 DANGEROUS EXCAN
Subdivision 1. Definitions. (a) The definitions in this su bdivision apply to this section. Subdivision 1. Wells, pools
(b) "Gift" has the meaning given given it in section 10A.071, subdivision 1. county, city or town may regulate
cisterns, recharging basins, catch
(c) "Interested person" means aperson orarepresentative of a person or association that i i abandor
use, maintenance or
has a direct financial interest in a decision that a local official is authorized to make. Th e
4- any considerable number of per
(d) "Local official" means an elected or appointed official of a county or city or of -,in suant to the laws relating to pub
agency, authority, or instrumentality of a coun ty or city.
Subd. 2. Abate by cover, fe
Subd. 2. Prohibition. An interested person may not give a gift or request another to give
ably covering g
g ift from an interested. person. - such installation c
a gift to a local official. A local official may not accept a g 37
Subd. 3. Exceptions. (a) The prohibitions in this section do not apply if the gift is' History: 1955 c 601 s 1,2;
(1) a contribution as defined in section 211A.01, subdivision 5;
UNTY A (2) services to assist an official in the performance of official duties, including but not 471.9SubdiviOsion 1. limited to providing advice, consultation, information, and communication in connection
general welfare of its residents,
with legislation, and services to constituents-, K iD and and junk dealers.
(3) services of insignificant monetary va lue; services in afield . of specialty or Subd. 2. implementation.
C, . in- individual se
(4) a plaque or similar memento recognizing section shall be furthered by th
to a charitable cause; nance provisions.
(5) a trinket or memento o f insignificant value;
History: 1985 c 289 s 9;
(6) informational material of unexceptio nal value; or
t
meal, or meeting
(7) food or a beverage given at a reception, away from the recipien g
the recipient appears to make a speech or ail 471.925 DEFINITIO NS.
place of work by an organization before whom
part of a program. ram For purposes oections
saver questions as pa
1P apply if the gift is given: means a person engaged in the
(b) The prohibitions in this section do not memb are but riot ted to coins ehi cl es ant
gold, si
t's membership in a group, a mjority of whose
(1) because of the recipie n motor v :
ivalent gift is given to the other a members of the group ers or vehicles or
not local officials, and an equ oods and merchandise taken
(2) by an interested person who is a ot m meber of of u g
ly of the recipient, nlessthegift'
member of that family. History: 1985 c 289 S 10
is given on behalf of someone who is n a
History: 1994 c 377 s 6 471.926 RELATION TOO
S, HOSPITAL; TRANSFER TO COUNTY. Any or adopted b
471.90 STATUTORY CITIES, a duly authorized by unanimous vote Of its aON*ern plement and be in addition to a
Subdivision 1. Authorization. When
building d, situated thereon or a nomin an or rule. 1985 c 289,S 1
ing body any statutory city owning real estate an d a hospital f
equipment jointly with the county in which said statutory city is locate may, History:
consideration or without consideration, transfer its title and interest in the real estate, hospital
said county. 471.92 COOPERATION'
building, and equipment to s majority vote of its
The governing body of a:
Subd. 2. County may accept. Said county, when authorized by a
such grant and conveyance. riunkdeale,-
governing body, may accept latesecondhando J