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Montgomery County Ethics Commission
Text of Waivers - 1997

[Waiver 1997-1]


MEMORANDUM

TO: David W. Edgerley, Director
Department of Economic Development

FROM: Laurie B. Horvitz, Chair [initialed]
Montgomery County Ethics Commission

SUBJECT: Request for Advisory Opinion and Waiver

DATE: February 26, 1997

 

 

The Montgomery County Ethics Commission has reviewed your memorandum, dated February 5, 1997, in which you requested an advisory opinion and, if necessary, a waiver. In your memorandum you discussed the Department of Economic Development's interest in developing a project known as a "Business Resource Center." Your memorandum described the mission and services of the new center. The mission of the center would be to encourage the growth and productivity of small businesses by providing the following services: business counseling; business plan development; start up and entrepreneurial assistance; mentoring; computer access; library training and reference material; networking; and group training. The Department of Economic Development likely would provide operating or equipment financing to the center. Montgomery College also has expressed interest in contributing certain resources to this center. Although the details of the proposed partnership were not included in your memorandum, you explained that the College may contribute space, staff, and operating support. The center may be located at the College.

You have consulted the Ethics Commission because of your dual appointment as the Director if the Department of Economic Development for the County and as Special Assistant to the President for Montgomery College. In a memorandum dated September 8, 1995, the Commission first addressed your dual appointment and carefully considered your request for any waivers necessary to permit this dual appointment. At that time, the Commission issued a waiver of specific provisions in Section 19A-12 (prohibiting certain secondary employment) and a waiver of Section 19A-11(a)(1) (governing certain conflicts of interest). At that time, the Commission imposed several conditions upon its approval of your waiver request. These conditions were intended to reduce or eliminate any conflict of interest between the two positions. Although the College's interests will usually complement the County's economic development interests, there occasionally may be circumstances where the College and the County possess divergent interests or priorities.

In a subsequent memorandum, dated October 24, 1996, the Commission reviewed a report concerning your first year of service in both positions. At that time, the Commission cautioned you to be mindful of the conflicts that may arise. In order to reduce the likelihood of any conflicts, and to minimize the potential harm of any conflicts, the Commission stated that you must still comply with six of the earlier conditions. According to that memorandum, the following conditions remain applicable and must be observed:

  1. Your primary responsibilities shall be to serve as the Director of the Department of Economic Development, while your duties as Special Assistant to the President of Montgomery College shall be secondary.
  2. You shall not act as a public spokesman for the College.
  3. You shall not solicit funding or grants on behalf of the College. Furthermore, you shall not identify County grants for the College except to the extent that you ordinarily identify such County grants to members of the general public.
  4. You shall not divulge to the College any confidential information obtained through your County position. See Sec. 19A-15(a) of the Montgomery County Code.
  5. You must recuse yourself from any transactions which involve as parties both Montgomery County Government and Montgomery College. See Sections 19A-11(a)(2)(A) and 19A-12(b)(1)(B) of the Montgomery County Code. Neither provision has been waived by the Commission's decisions.
  6. The waiver is based on the position description for the Special Assistant to the President of Montgomery College that was attached to the Commission's 1995 memorandum. If any additional changes are made to this position description, an additional waiver may be necessary.

Based on these conditions, the Commission's waiver remained in effect after the Commission's one-year review.

In light of these conditions, you prudently decided to request advice regarding the Business Resource Center. Without clarification or a waiver, you would be prohibited from recommending or approving an award of County funds for this program and would not be allowed to participate in the Center's development and administration. See conditions 3 and 5 above.

By a majority vote, the Commission has decided to issue an additional waiver permitting your full participation in the proposed center. The Commission has employed the waiver standard in Section 19A-8(a) which applies to conflicts of interest. This standard requires the Commission to find the following:

  1. the best interests of the County would be served by granting the waiver;
  2. the importance to the County of a public employee performing his or her official duties outweighs the actual or potential harm of any conflict of interest; and
  3. granting the waiver will not give a public employee an unfair advantage over other members of the public.

As your memorandum explained, the Business Resource Center will advance legitimate interests of the County. The proposed partnership between the Department of Economic Development and the College is likely to improve the Center's effectiveness and to minimize the County's financial contribution. Although you have provided the Commission with few details regarding similar programs in other jurisdictions, you have advised the Commission that other counties have developed business resource centers and that some of these centers are associated with local educational institutions. In addition, your unique role with both institutions would allow for an effective coordination of resources. Therefore, the Commission has determined that the best interest of the County would be served by granting the waiver.

The Commission has also concluded that the importance of your participation in this program outweighs the actual or potential harm of any conflict of interest. As Director of the Department of Economic Development, it is important for you to participate in funding and other decisions relating to this program. Furthermore, there is little likelihood of any conflict of interest. With respect to this particular program, the County and the College do not possess divergent interests. Therefore, you are not likely to encounter circumstances where the goals and priorities of the College impede or conflict with the County's objectives for the Center. In addition, you will not receive any personal financial benefit from the program. You are a salaried employee and will not receive any bonus based upon the College's participation in the program.

The Commission also determined that the waiver will not give you an unfair advantage over other members of the public. As explained above, you will not be provided with any financial benefit from this program. If the program succeeds, you may receive general recognition for its success from the College or the County. Any recognition for such a professional accomplishment is not tantamount to an "unfair advantage."

Accordingly, the Commission has approved your request for a waiver. The approval is limited to your participation in this particular program. The six conditions remain in effect for all other activities. As stated previously, the Commission remains concerned that the interests of the College and the County could diverge in some circumstances. Therefore, it remains important for the Commission to review any other transactions which involve the Department of Economic Development and the College and any other proposals that may involve your solicitation of funding or grants for the College.

cc: Mr. Bruce Romer, Chief Administrative Officer
Chuck Thompson, County Attorney


[Waiver 1997-2]

March 17, 1997


Carol Rubin, Esq.
Office of the County Attorney

Dear Ms. Rubin:

The Ethics Commission has reviewed your request for a waiver of Section 19A-13 of the Montgomery County Code. In a Memorandum dated December 30, 1996, you requested a waiver so that you may accept employment with Moore & Associates, a commercial real estate development firm located in Silver Spring. The Commission was provided the following information:

In June 1992 you were assigned responsibility for legal oversight of the Silver Spring Redevelopment Program by the County Attorney. In February 1995, a Redevelopment Program office was established in Silver Spring and you were relocated there. Over the past four years with the County you (1) developed Urban Renewal Plans and strategies for the revitalization of Silver Spring; (2) participated in negotiations of agreements on behalf of the County; (3) approved all relevant County documents for form and legality; (4) managed land acquisition activities in the Urban Renewal Area; and (5) provided advice and recommendations to the Director of the Silver Spring Redevelopment Program and the County Executive concerning various aspects of revitalization activities in Silver Spring, including economic development initiatives. Many of these responsibilities involved negotiations with Moore & Associates because this firm was selected by the County to develop two major projects in Silver Spring's revitalization plan. In November of 1996, you had an initial conversation with a member of Moore & Associates regarding your possible employment as General Counsel with Moore & Associates. As soon as you commenced discussions with Moore & Associates, you withdrew from any representation of the County in its relationship with the firm. You have since been offered a job.

In a January 9, 1997 memorandum, Mr. William Mooney, your supervisor, informed the Commission that he had no objection to the Commission granting your waiver request. According to Mr. Mooney's letter, you do not possess confidential information concerning the County that is relevant to Moore & Associates or to the firm's property in the Urban Renewal Site. According to Mr. Mooney, the County is not negotiating or dealing with Moore & Associates in any substantive way except for enforcement of the Office Memorandum of Understanding. The County currently has no plans to acquire any of Moore & Associates' property.

If necessary, you have requested a waiver of Section 19A-13 of the Montgomery County Code. Section 19A-13 states:

(a) A former employee must not accept employment or assist any party, other than a County Agency, in a case, contract, or other specific matter for 10 years after the last date the employee significantly participated in the matter as a public employee.
(b) For one year after the effective date of termination from County employment, a former public employee must not enter into any employment understanding or arrangement (express, implied, or tacit) with any person or business that contracts with a County Agency if the public employee:
(1) significantly participated in regulating the person or business; or
(2) had official responsibility concerning a contract with the person or business (except a non-discretionary contract with a regulated public utility).

The Ethics Commission first examined whether you needed to obtain a waiver of Section 19A-13. The Commission reviewed your duties and responsibilities with the Redevelopment Program as they involved Moore & Associates and determined that your request for permission to work for Moore & Associates required a waiver of Section 19A-13(b).

The Commission then applied Section 19A-8(b) which states:

(b) After receiving a written request, the Commission may grant a waiver of the prohibitions of subsection 19A-12(b) or Section 19A-13 if it finds:
(1) the waiver is needed to ensure that competent services to the County are timely and available;
(2) failing to grant the waiver may reduce the ability of the County to hire or retain highly qualified public employees; or
(3) the proposed employment is not likely to create an actual conflict of interest.

Under this test, only one of the three criteria must be satisfied in order to grant a waiver request.

Based upon the facts presented in your memorandum and Mr. Mooney's correspondence, the Commission determined that Section 19A-8(b)(3) has been satisfied. The Commission found that the proposed employment is not likely to create an actual conflict of interest if you observe certain conditions. Accordingly, the Commission granted you a waiver of Section 19A-13(b) and imposed the following conditions:

(1) If the County enters into negotiations with Moore & Associates at any time in the future, you must not be involved in those negotiations for Moore & Associates.
(2) You must not represent Moore & Associates in any negotiations with the County regarding the Silver Spring Urban Renewal District.
(3) For the next 10 years, you must not participate in any litigation against Montgomery County involving contracts between Moore & Associates and the County that were in existence during your County employment (or renewals of those contracts).

If you deem necessary, you may request a waiver of these conditions, by presenting specific factual circumstances to the Commission for review and consideration at a future time.

The Commission trusts that this letter is responsive to your request. If you have any questions or need further assistance or advice, please contact our office.

Sincerely,
[signed]
Laurie B. Horvitz, Chair

LBH/jlw


[Waiver 1997-3]

April 11, 1997


Betty N. Ferber
Assistant County Attorney


Dear Ms. Ferber:

I write on behalf of the Montgomery County Ethics Commission in response to your memorandum of March 11, 1997. The Ethics Commission has considered your request for a waiver of the conflict of interest provisions in the County Code. See 19A-11 of the Montgomery County Code.

Specifically, you have advised the Commission that you have been assigned to review a legal matter on behalf of the Office of the County Attorney with respect to the application of the federal tax laws to a particular transaction involving the Potomac Edison Company. You own stock in the company both individually and in conjunction with others totaling approximately Thirty Thousand Dollars ($30,000.00). The issue that you have been assigned concerns whether the Federal Government may impose a tax upon a component of the project. The tax is passed along to the County by PEPCO. According to your memorandum, you are not analyzing PEPCO's tax liability. Instead, the County Attorney's Office is examining whether or not Montgomery County has a liability through PEPCO to the Federal Government.

At the Commission's meeting in March, the County Attorney informed the Commission of your unique qualifications to work on this project. He expressed support for your waiver request.

Based upon the County Attorney's recommendation, and your professional background and expertise, the Commission found that the best interests of the County would be served by granting the waiver. In addition, the Commission found that the importance to the County of your performing your official duties outweighs the actual or potential harm of any conflict of interest. Significantly, your involvement is not likely to affect PEPCO's liability. Therefore, the potential harm from this conflict is minimal. Finally, issuance of a waiver will not give you an unfair advantage over other members of the public. Your participation in this matter will not inure to your unique advantage as a PEPCO stockholder. Instead, you may save the County and the taxpayers from paying unnecessary taxes. Accordingly, you have satisfied the three criteria for a waiver of Section 19A-11. See 19A-8(a). Therefore, the Commission concluded that the conflict of interest provision in the Ethics Code should be waived in order to permit your participation in this legal matter.

Thank you for contacting the Commission. I trust that the Commission has fully answered your questions. If you have any additional concerns, please do not hesitate to contact us.

Very truly yours,
[signed]
Laurie Horvitz, Chair
Montgomery County Ethics Commission

LH/jlw


[Waiver 1997-4]

May 28, 1997


Carol Rubin, Esq.


Dear Ms. Rubin:

In your letter of April 11, 1997, you asked the Ethics Commission to reconsider its determination of March 21, 1997 regarding your employment with Moore & Associates. In that earlier determination, the Commission granted your waiver request but set forth three conditions limiting your activities with Moore & Associates.

The Ethics Commission has considered the concerns that you expressed in your April letter. The Commission has decided to modify its earlier decision and has revised the three conditions to accommodate your concerns. Your waiver is now governed by the following conditions:

Condition 1:
If the County enters into negotiations with Moore & Associates during the first year following your employment with the County, you must not be involved in those negotiations.

Condition 2:
You must not represent Moore & Associates in any negotiations with the County regarding the Silver Spring Urban Renewal District during the first year following your employment with the County.
Additionally, you may not participate for 10 years following your employment with the County in any negotiations between Moore & Associates and Montgomery County regarding any Silver Spring Urban Renewal District matters if you significantly participated in those matters as a County employee.

Condition 3:
For ten years following your employment with the County, you must not participate in any litigation against Montgomery County involving contracts between Moore & Associates and the County that were in existence during your County employment (or renewals of those contracts).
With respect to the third condition, you may seek case by case advice from the Commission if you do not believe that you significantly participated in the particular contracts that are the subject of such litigation.

The Ethics Commission has decided to grant your waiver request with these narrower restrictions. The Commission has concluded that the requirements of Section 19A-8 of the Montgomery County Code are satisfied by these revised conditions. The potential harm of any conflict of interest is adequately addressed by this revised waiver.

We trust this letter is responsive to your concerns. If you have any additional questions, please let us know.

Sincerely,
[signed]
Laurie B. Horvitz, Chair

LBH/jlw


[Waiver 1997-5]

MEMORANDUM

June 3, 1997

To: W. Van Aller
Communications Systems Engineer
Department of Information Systems & Telecommunications
From: Montgomery County Ethics Commission
RE: 800 MHz; Waiver

Willem Van Aller has requested a waiver from the conflict of interest provisions of §19A-11 of the Montgomery County Public Ethics Law. Van Aller requests this waiver in order to participate in the implementation stage of the County's project to acquire a new 800-Mhz public safety radio communications system. Bruce Romer, Chief Administrative Officer, and Donald V. Evans, Director, Department of Information Systems and Telecommunications (DIST), have submitted a memorandum supporting Van Aller's request.

Factual Background
The County has issued a Request for Proposal (RFP) to purchase an 800-MHz public safety radio communications system. In September 1996, the County retained the services of TRW to act as a consultant on this project. According to Donald Evans, TRW will act as a check and balance to in-house oversight over the 800-MHz project. TRW has assisted the County in preparing the RFP and will provide assistance in evaluating responses to the RFP.
Van Aller owns 960 shares of Motorola stock with a present value of about $52,800. The Motorola stock produces income of about $384 per year. Since its purchase in 1974, Van Aller has not bought or sold Motorola stock. In addition, Van Aller owns stock in GE. Van Aller obtained the stock while he was an employee of GE between 1960-1970. Van Aller owns some of the GE stock directly and other shares are held in a mutual fund named GE Savings and Security. The present value of the GE stock is about $91,000 and produces yearly income of about $2,800. Van Aller has not actively traded GE stock since 1970, but dividends from the GE Savings and Security Fund are reinvested in GE stock.
The County expects that Motorola and Ericsson Communications will submit proposals in response to the RFP. GE has an ownership interest in Ericsson.
In accordance with the County's Procurement Regulations, the Qualification Selection Committee (QSC), as a committee, will evaluate proposals and make a recommendation for a contract award. Donald Evans, as the Director of DIST, will review the QSC's recommendation and forward and forward a Department recommendation to the Director of Procurement who will make the final decision regarding a proposed contract award. After a contract award is posted, the County will negotiate with the highest ranked offer or enter into a contract.
The County wishes Van Aller to serve on the QSC along with other individuals representing user agencies and the technical departments of the County government. Van Aller apparently will provide technical assistance in negotiating this contract. Finally, after the contract is executed, Van Aller will also apparently play a role in providing technical input regarding administration of the contract.
Van Aller, Donald Evans, and Bruce Romer all agree that Van Aller's expertise in radio communications is unique in the County government and without substitute.

Ethics Law
Section 19A-11 provides that a public employee must not participate in a matter that affects, in a manner distinct from its effect on the public generally, a business in which the employee has an economic interest. Furthermore, a public employee must not participate in a matter if the employee knows that a party in the matter is a business in which the employee has an economic interest.
The Ethics Commission may waive the prohibitions of §19A-11 if the Commission finds that "(1) the best interests of the County would be served by granting a waiver; (2) the importance to the County of a public employee performing his or her official duties outweighs the actual or potential harm of any conflict of interest; and (3) granting the waiver will not give a public employee an unfair advantage over other members of the public." Section 19A-8(a).

Analysis
If Motorola or Ericsson, or both, submit a proposal in response to the RFP, §19A-11 would prohibit Van Aller from participating in evaluating proposals to the RFP. If Motorola or Ericsson is the proposed awardee and eventually the County's 800 MHz contractor, §19A-11 would likewise prohibit Van Aller from participating in matters involving the negotiation and administration of the contract as well.
The Ethics Commission believes that, under the circumstances of this case, the requirements under §19A-8 for granting Van Aller a waiver from the prohibitions of §19A-11 have been met. Van Aller, with the support of the Director of DIST and the Chief Administrative Officer, has demonstrated that it is in the County's best interest for Van Aller to participate in the implementation stage of the 800 MHz project. Van Aller is the only County employee with the technical knowledge needed to implement the 800 MHz project. The Commission notes that, with respect to the selection of the proposed contractor, Van Aller's recommendations will be only one of many in making the final determination. Van Aller's technical knowledge will be, in part balanced by the technical assistance of TRW. Finally, although by County standards the acquisition of the 800-MHz radio communications system will involve significant amounts of County funds, the Ethics Commission believes it is highly unlikely that the value of Van Aller's stock will be affected one way or the other by actions taken by the County in this project.
Accordingly, the Ethics Commission concludes that: (1) it is in the best interests of the County to grant this waiver; (2) the importance to the County of Van Aller performing his official duties outweighs the potential harm of any conflict of interests; and (3) granting this waiver will not give Van Aller an unfair advantage over other members of the public.

Conclusion
The Ethics Commission grants a waiver to Van Aller for the purpose of participating in the evaluation of proposals submitted in response to the County's RFP for acquisition of an 800-MHz radio communications system, to provide the County with technical advice in the negotiation of a contract with the highest rank offeror; and to assist the County in monitoring any contract awarded under the RFP.
The waiver is issued pursuant to action taken by the Ethics Commission on May 13, 1997.

[signed]
_____________________
Barbara McNally, Executive Secretary
Montgomery County Ethics Commission

cc: Bruce Romer, Chief Administrative Officer
Donald V. Evans, Director, DIST
Marc P. Hansen, Chief, Division of General Counsel, Office of the County Attorney

MPH:kh:97.01865


[Waiver 1997-6]


M E M O R A N D U M


July 8, 1997

TO: Councilmember Nancy Dacek
FROM: Laurie B. Horvitz, Chair [signed]
Montgomery County Ethics Commission
SUBJECT: Waiver re Friendship Heights Sector Plan

The Ethics Commission has considered your request for a waiver to allow your participation in the Council's deliberations of the Friendship Heights Sector Plan.
In your request you indicated that the May Company is a major developer in the Friendship Heights area. You are requesting this waiver because your husband owns approximately 11,000 shares of May Company stock and the County Council will be considering this Plan in the near future.

Section 19A-11 of the County Code states:

Unless permitted by a waiver, a public employee must not participate
in:
(1) any matter that affects, in a manner distinct from its effect on the public generally, any:
* * *
(C) property or business in which a relative has an economic interest, if the public employee knows about the relative's interest.

A waiver of this prohibition is permitted under Section 19A-8(a) if the Commission finds the following:

(1) the best interests of the County would be served by granting the waiver:
(2) the importance to the County of a public employee performing his or her official duties outweighs the actual or potential harm of any conflict of interest: and
(3) granting the waiver will not give a public employee an unfair advantage over other members of the public.

The Commission has decided to grant your waiver request so that you may participate in deliberations regarding the Friendship Heights Sector Plan. However, the Commission has decided that you must publicly disclose your husband's stock ownership prior to any such deliberations.

Your request did not specifically address whether you wished to cast a vote regarding any of the May Company's properties. Nonetheless, the Commission addressed this issue at its last meeting and concluded that you should not cast a vote regarding any properties owned by the May Company.

In reaching these decisions, the Commission concluded that the best interests of the County would be served by permitting your participation as a Council member in these important matters. The Commission has concluded that the importance to the county of the performance of your official duties outweighs the actual or potential harm of any conflict of interest. Notably, your role as an elected official cannot be delegated to others. In addition, the harm of any conflict of interest is minimized by the public disclosure of your husband's interest, your limited participation as a non-voting member, and the involvement of other Council members in the deliberations.

The Commission also has determined that granting the waiver will not give you an unfair advantage over other members of the public. Your non-voting participation in this particular sector plan is not likely to affect the value of your husband's stock. Significantly, the May Company is a sizeable company and, therefore, particular decisions by a county government are not likely to significantly affect stock values.

The Commission trusts that this letter is responsive to your request. Please contact the Commission office if you have any questions regarding this decision.


[Waiver 1997-7]


July 10, 1997

Mr. Thomas G. LaFleur


Dear Mr. LaFleur:

The Montgomery County Ethics Commission has reviewed your letter dated April 21, 1997. In that letter, you express an intention to retire from County employment and an interest in finding full time employment prior to retirement. You request a waiver of Section 19A-13 so that you may seek and secure employment with one of the firms that has requirements contracts with the County. Alternatively, you suggest employment as an independent sub-contractor for one of these firms.

In your letter, you have offered to limit your post-retirement to minimize any potential work conflict of interest. Although your prospective employer may possess County contracts, you would not perform work on any Montgomery County Government contract or on any contract that is administered by or performed for the Department of Information Systems and Telecommunications ("DIST").

Section 19A-13 states:
(a) A former employee must not accept employment or assist any party, other than a County Agency, in a case, contract, or other specific matter for 10 years after the last date the employee significantly participated in the matter as a public employee.
(b) For one year after the effective date of termination from County employment, a former public employee must not enter into any employment understanding or arrangement (express, implied, or tacit) with any person or business that contracts with a County Agency if the public employee:
(1) significantly participated in regulating the person or business; or
(2) had official responsibility concerning a contract with the person or business (except a non-discretionary contract with a regulated public utility.)
(c) Significant participation means direct administrative or operating authority to approve, disapprove, or otherwise decide government action with respect to a specific matter, whether the authority is intermediate or final, exercisable alone or with others, and exercised personally or through subordinates. It ordinarily does not include program or legislative oversight, or budget preparation, review, or adoption.

Section 19A-8 permits the Commission to waive the requirements of Section 19A-13. The Commission has approved your waiver request to secure employment with a firm that is currently contracting with the County. The waiver permits you to work as an employee of the contractor or as an independent sub-contractor.

However, the waiver is conditioned upon two restrictions that you proposed in your letter. First, you may not work on any DIST-related work. Second, you may not work on any County contracts during the periods prescribed by Section 19A-13. This second prohibition only applies if the contract falls within the scope of Section 19A-13, e.g. you significantly participated in regulating the firm, had responsibilities concerning a contract with the firm, or significantly participated in the particular matter. See Section 19A-13(a) and (b).

The Commission has concluded that the proposed employment, with these two limitations, is not likely to create an actual conflict of interest.

The Commission hopes that this decision is responsive to your request. Please contact our office if you have any questions regarding this waiver decision.

Sincerely,
[signed]
Barbara McNally
Executive Secretary

BMM:jw

 

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