Conflicts of interest explained

Election season seems to bring out the worst in some. Is it desperation, an unfettered drive to compete, or simple antipathy that elicits the tendency to accuse and confuse, with or without basis? Sometimes even those nobly intended are inaccurate.

Take conflicts of interest - a term bandied year-round and whose applications too few (including some elected officials) accurately comprehend.

Routinely three basics are misunderstood.

One: Any interest does not necessarily amount to a conflict.

Two: Conflicts rules apply only to certain "proceedings," not just any meeting or official act.

Three: If a potential conflict exists, that doesn't necessarily mean the official can't discuss, debate, or yes - even vote on the issue. Nevertheless, even when they might legally do so, officials may abstain on an ethical basis to appease not the law so much as their (or their constituents') consciences.

Federal and state laws include many provisions relating to conflicts of interest. Some are more general, others pertain to specific offices both elected and appointed. In addition, certain professions - such as attorneys, bankers, medical industries, insurers, and investment advisers - have their own conflict rules. Others apply to corporate (profit and nonprofit) boards.

Each defines conflict, and what must be done if it is suspected, a little differently. "Conflict of interest" is defined simply by Webster's Dictionary as "a conflict between the private interests and the official responsibilities of 'a person in a position of trust.'" Generally what's at stake is impartiality, but that's only the beginning.

Legal definitions specify that "a person of trust" is a public official or one who has a "fiduciary duty" - such as a trustee, board member, attorney, or executor (e.g., of a will) - to act for the benefit of another. If a private interest (usually financial, affecting money/property, business, non-public career, or immediate family) may potentially clash with that duty, there may be a conflict.

Or there may not: point one. Just having an interest does not necessarily mean a clash. Might the interests of the public/beneficiary coincide? It happens occasionally.

Certain professions, such as judges, also have higher standards and special rules, specifying that even without actual conflict the mere appearance of one can be sufficient reason to step away, to engender public faith in the court system.

Idaho has three primary laws (and more agency-specific rules) governing official conflicts and ethics, but one - the Ethics in Government Act - is most commonly at the center of public concern. Under this law, the potential "benefit" to be avoided is to "a public official or member of his household" and one of "economic gain" (e.g., money, valuable property, or employment) and not merely a remote interest (one of several exceptions). A remote interest might be a very low percentage ownership of stock, or other benefit with little impact. Public servant includes consultants and others "performing a governmental function."

Remember point two above? The "proceeding" to which these rules apply must be one "the outcome of which is required to be based on a record," in other words, a meeting whose result - not just standard minutes of the meeting - must be officially recorded. That typically means a vote or a public hearing. Oh, and speaking of meetings, even an official with a conflict may be counted to determine a quorum (the minimum number necessary to hold an official meeting), even if s/he doesn't vote.

OK, that's where, when, and for whom a conflict may come up. On to point three - what if it does? The answer turns on one key word: disclosure.

Disclosure isn't due directly to the public. It's given to the "body" - i.e., city council, county commission, legislature, or agency - of which the official is part. The disclosure must be (1) before the relevant contract or vote, and (2) on record, i.e., in meeting minutes, so theoretically the public gets notice this way, often through newspapers and other media monitoring.

Then what? Recuse/excuse oneself and bow out, or participate? That depends on what the body does with the disclosure and of course, the extent of the potential conflict. The rest of the group can vote to let the official continue, or not. Generally the law explicitly requires the disclosure, but unless more specific rules apply, not the removal. Sometimes they decide to keep the interested official in the loop (still attend meetings and review information) and the vote; perhaps only one, but rarely neither. Sometimes the official bows out anyway, due to personal discomfort or anticipating negative public reaction regardless of legal permissibility.

For much more information on conflicts laws, see the Ethics in Government Manual at AG.Idaho.gov (Idaho) and OGE.gov (federal). Thanks to attorney and former state legislator Denny Davis for the topic suggestion.

Sholeh Patrick, J.D. is a columnist for the Hagadone News Network. Contact her at sholeh@cdapress.com.