OREGON GOVERNMENT ETHICS COMMISSION

1. OREGON GOVERNMENT ETHICS COMMISSION Training on Oregon Government Ethics Law 12-1-2011 Oregon State Board of Education

2. Objectives • Identify when, as a public official, the law restricts some choices decisions or actions you may make. • Review how the provisions in ORS Chapter 244 apply to opportunities for personal gain or to avoid an expense. • Review how the provisions in ORS Chapter 244 apply to conflicts of interest. • Convene and conduct an executive session in compliance with the applicable provisions.

3. Training Outline • Prohibited financial gain & allowed financial gain • Conflicts of interest • Executive sessions • Oregon Government Ethics Commission • Questions you may have

4. Oregon Government Ethics Law • Enacted by voters in 1974 • Use of office and conflict of interest provisions found in ORS Chapter 244 • Clarification provided in OAR Chapter 199 • Executive session provisions found in ORS 192.660-192.685

5. Safeguard of the Public Trust “The Legislative Assembly declares that service as a public official is a public trust, and that as one safeguard for that trust, the people require all public officials to comply with the applicable provisions of this chapter.” ORS 244.010 (1)

6. Public Official A “public official” is any person who is serving the State of Oregon or any of its political subdivisions or any other public body, as an elected official, appointed official, employee, agent or otherwise, irrespective of whether the person is compensated for the services. Elected Official Employee Supervisor Volunteer*Contractor*

7. Financial Gain

8. Prohibited Financial Gain ORS 244.040(1) Prohibits the use or attempted use of position or office to obtain financial gain that would not otherwise be available, but for the position or office. The prohibited financial benefit can be either an opportunity for gain… …or to avoid an expense.

9. Prohibited Financial Gain The public official is prohibited from obtaining financial gains for: ■ Himself ■ A relative of the public official ■ A household member of the public official ■A business with which any of them are associated

10. Who Are My Relatives? ORS 244.020(15) • Spouse • Children • Siblings • Spouse of Siblings • Parents • Person for whom the public official have a legal support obligation • Person to whom the public official provides benefits through the public official’s public employment • Person who provides benefits to a public official or candidate through the person’s employment

11. Member of Household Be aware of actions that may result in a financial effect to a member of your household, or the household of any of your relatives. If household members are economically impacted, it could create either an economic benefit or loss to you or one of your specified relatives, so that action might cause you to violate the law.

12. Diagram of Relatives Other people as defined in 244. 020 (15) (f) (g) and (h)

13. Definition of “Business” ORS 244.020(2) A “business” is: any corporation, partnership, proprietorship, firm, enterprise, franchise, association, organization, self-employed individual and any other legal entity operated for economic gain. note: public bodies not included A “business” is not: any tax-exempt 501-C non-profit organization, if the public official or a relative of the public official is associated only as a member or board director or holds an unpaid position.

14. Definition: “Associated With” ORS 244.020(3) A person is “associated with” a private business if: the person is a director, officer, owner or employee, or agent of the business; or if a person owns or has owned more than $1000 worth of stock, equity interest, stock options, or debt interest of a private business in the preceding calendar year. A person is “associated with” a publicly held corporation if: the person is an officer or director of the publically traded company, or if the person owns or has owned more than $100,000 worth of stock in the preceding calendar year.

15. Prohibited Use of Office

16. Question to Ask: “Would I have this opportunity if I was not a public official? If the answer is NO, you may be prohibited! ? ? ? ? ? ?

17. Prohibited Use of Office Unless the general public has the same access, that use is prohibited.

18. Use of Office and Private Employment

19. Private Employment of Public Officials In general, public officials may obtain employment with a private employer or engage in private income producing activity of their own. • Must not use the position held as a public official to create the opportunity for additional personal income. • Ensure that there is a clear distinction between the use of personal resources and time for personal income producing activity and the use of the public body’s time and resources.

20. Guidelines for Private Employment • Use no governmental body time • Use no governmental body resources • Take no official action that could financially impact your private enterprise • Use no confidential information obtained … . through your position as a public official • Disclose all conflicts of interest Guide for Public Officials, page 16

21. Employment and Contracts For two years after a public official ceases holding the position as a public official may not have a direct beneficial financial interest in a public contract when one of the parties to the contract is the official’s former public body if the contract: • Was authorized by the public official, in their former capacity as a public official. • Was authorized by a governing body (board, committee, or council) that the former public official was a member of when the contract was authorized. ORS 244.047

22. Future Private Employment ORS 244.040(3) prohibits a public official from directly or indirectly, soliciting or accepting the promise of future employment based on the understanding that the offer is influenced by the public official’s vote, official action or judgment.

23. Use of Office Now that we have looked at some prohibited benefits, we will review the allowable financial benefits in ORS 244.040(2).

24. Allowable Financial Gain • Official Compensation Package • Honoraria less than $50 • Reimbursement of Expenses • Award for Professional Achievement • Gifts [To be continued]

25. Scenarios – Lawful Financial Gain • Official Compensation Package • Honoraria less than $50 • Reimbursement of Expenses • Award for Professional Achievement

26. Conflict of Interest

27. Conflict of Interest In brief, a public official is met with a conflict of interest when participating in an official action could result in a financial benefit or detriment to the public official, a relative of the public official or a business with which either are associated.

28. Conflicts of Interest Statutory conflicts of interest have three components: 1. An action, decision, or recommendation made in the official capacity which causes 2. A private pecuniary benefit or detriment for 3. The public official, the public official’s relatives, or a business associated with the public official or the public official’s relative.

29. Conflicts of Interest Many of these words have a specific meaning in statute. Reviewing the definitions of some of these words will help us understand the statute more clearly.

30. Definition: Pecuniary Benefit Pecuniary benefit Benefit measureable in terms of money. Pecuniary detriment Loss measurable in terms of money.

31. Definitions The definitions for Conflicts of Interest are the same as the ones for Prohibited Use of Office, including: ■ Relative ■Business ■Business you are “associated with” Remember: public bodies not included

32. Member of Household As mentioned before, if household members of you or one of your relatives are economically impacted, it could create either an economic benefit or loss to you or one of your relatives, so that action might present you with a conflict of interest.

33. Conflicts of Interest Now that we have reviewed the definitions individually, we can see how they relate together in the conflict of interest statutes.

34. Actual Conflicts of Interest Actual Conflict of Interest Any action, decision, or recommendation by a public official in their official capacity, the effect of which WOULD be to the private pecuniary gain or detriment of the public official, a relative or household member of the public official, or a business with which any of the above are associated. ORS 244.020(1) If the financial effect of an action is both specific and certain, then that action presents an actual conflict of interest.

35. Example: Actual Conflict of Interest Let’s say a public body is going to award a contract. The company that is awarded the contract will receive a specific financial impact; that is, they will be able to do business according the terms of the contract. The companies that are not selected will also see a specific financial impact; that is, they will lose the opportunity to do business according to the terms of the contract. Since awarding the contract will definitely cause those results, then participating in awarding the contract will cause both a specific and certain financial impact, and could present an actual conflict of interest to a public official.

36. Potential Conflicts of Interest PotentialConflict of Interest Any action, decision, or recommendation by a public official in official capacity, the effect of which COULD be to the private pecuniary gain or detriment of the official, relative, or business of official or relative. ORS 244.020(12) If the financial effect of an action is unknown, or if the financial effect might happen but might not, so the effect of that action is not certain, then that situation would present only a potential conflict of interest to a public official.

37. Example: Potential Conflict of Interest Let’s say a public official has the opportunity to decide whether or not to solicit bids for a contract. His brother works for a company that performs the services described in the contract. The financial effects of the contract are specific. A company that wins the bid will do business according to the terms of the contract. However, the effect of opening a bid is uncertain. If a bid is opened, the brother’s company might put in a bid, but they might not. Since the financial effects of this vote are specific but uncertain, they do not present an actual conflict of interest, only a potential conflict of interest.

38. Summary: Conflict of Interest To summarize, there are several conditions that must be met in order to create a conflict of interest. 1.) The action must be an official action of a public official 2.) That official action either might result in or will result in a private financial benefit or loss 3.) The private financial result must affect one of the parties specified in the statute

39. What if I have a conflict of interest?

40. Appointed to Boards/Commissions & Elected Public Officials Must publicly announce the nature of the conflict of interest on each occasion the conflict arises. • Must publicly announce potential conflicts of interest, on each occasion beforetaking action. • Must publicly announce actual conflicts of interest, on each occasion, and refrain from participating in discussion, debate, or voting on the issue out of which the actual conflict arises.

41. Does Disclosure Exempt You from violation? No! Disclosure does not exempt you from violation.

42. Appointed, Employed or Volunteer Must provide written notice to the person who appointed or employed you. The notice must describe the nature of the conflict of interest. An announcement needs to be made on each occasion the conflict of interest is met. Maintain a copy of the notice in your own records. ORS 244.120(1)(c)

43. The Public Body’s Response The supervisor must respond to the written conflict of interest notice by either assigning someone else to that task or by instructing the employee how to take care of the matter. This response should be in writing. ORS 244.120(1)(c) When a public official gives notice of a conflict, the notice mustbe recorded in the official records of the public body. ORS 244.130

44. Scenarios - Conflict of Interest

45. Sanctions for Ethics Violations • Civil Penalty: $5000 maximum [ORS 244.350] • Forfeiture: Twice the amount of any financial benefit realized from ethics violation [ORS 244.360] • Letters of Reprimand, Explanation or Education [ORS 244.350(5)]

46. Public Meetings Law:Executive Session Provisions

47. Public Meetings Law:Executive Session Provisions The Oregon form of government requires an informed public aware of the deliberations and decisions of governing bodies and the information upon which such decisions were made. [ORS 192.620] -Attorney General’s Public Records and Meetings Manual (Jan. 2008)

48. Resource Attorney General’s Public Records and Meetings Manual The Department of Justice - Publications Section1162 Court Street NESalem, OR 97301-4096www.doj.state.or.us/public_records Available in a free online PDF at: http://www.doj.state.or.us/pdf/public_records_and_meetings_manual.pdf

49. What is an Executive Session? Executive session is any meeting or part of a meeting of a governing body which is closed to certain persons for deliberation on certain matters. A governing body may hold a meeting consisting of only an executive session. The notice requirements are the same as those for any other meeting.

50. Executive Session Provisions Provisions in ORS Chapter 192 allow specific, limited reasons for which a public body may meet in a closed session.