Supreme Court decision clears up the constitutional issue, but raises a myraid of local issues related to conflicts of interest by local officials | Eastern North Carolina Now

Publishers Note: This article originally appeared in the Beaufort Observer.

Many may apply locally.

    Is it a conflict of interest for a local government official to vote on a matter before a board upon which he/she sits if one of the parties with an interest in the issue before the board is a close associate, such as a client, employee or close business associate of the official? In recent years there has been a legal controversy about just how far ethics rules may go in restricting officials from participating in decisions that directly impact a close associate. Some have argued that such restrictions are an unconstitutional violation of the officials' free speech rights (which include freedom of association). The Supreme Court of the United States Monday (6-13-11) settled the legal issue, ruling that officials' free speech rights do not trump conflict of interest rules.

    The case before the Court was one from Nevada where a local city councilman had cast a vote on a casino/hotel project in which the officials long-time friend and campaign manager was a paid consultant to the developers of the project. The Court's decision was unanimous, although Justice Alito wrote a separate concurring (in the decision) opinion in which he used different reasoning than Justice Scalia's opinion for the Court. Click here to read the Court's decision.

    The decision gives rise to a number of questions that have been raised in recent months here in Beaufort County. We have elected and appointed officials who have sat on boards that have made decisions that have directly impacted members of their family, close personal/social associates and business associates who have benefitted from the decisions of the boards. The Hospital is a notable example. We also have a local official who owns a building via ownership of a corporation that rents the building to the government entity upon whose board he sits. We have other officials who have voted on contracts that involve close business associates (clients or customers) of the official.

    And then there are the "non-profits." Recently questions were raised in a public meeting about whether it is a conflict of interest for an elected or appointed officials on a governing board to vote to give money to a non-profit of which the official is a member. Similarly, issues have been raised about members of non-profit organizations, that are funded by tax levying entities, participating in decisions of the non-profit entity that benefit their members directly, their friends or business associates.

    The Supreme Court decision does not address the myriad of issues that arise in such conflict of interest issues or situations which appear to be a conflict of interest but what it does do is say that rules, policies, regulations, laws etc. that restrict such matters are not unconstitutional on their face.