… to CLE Fest 2006 Conflicts/Ch. 68 Training CLE Credits: 2 (ethics)

1. … … to CLE Fest 2006 Conflicts/Ch. 68 Training CLE Credits: 2 (ethics) Alex Corrections

2. What Every AttorneyShould Know AboutNew York CityConflicts of Interest Law or… Alex Corrections

3. …How to Beat the Conflicts Blues!! Alex Corrections

4. YOUR “CONFLICTS OF INTEREST”TOUR GUIDE WILL BE… Alex Corrections

5. GROUP INTRO’s Alex Corrections

6. Training Hand-Outs • Power Point print-out of this training • “What Every Attorney Should Know About NYC Conflicts of Interest Law” (bound booklet) • Chapter 68 of NYC Charter (the law) • Rules of the Board (Conflicts of Interest Board of the City of New York) • Instructional Articles on Main Conflicts Topics (authored by COIB officials/staff) • ACS packet: excerpt from Personnel Manual and ACS memos re Outside Employment/Law Practice) • Hypotheticals Alex Corrections

7. I. Introduction • Conflict of Interest – Generally: • Situation in which regard for one duty leads to disregard of another • Attorneys bound by Code of Professional Conduct • Law practice examples of conflict of interest… • Conflict of Interest – Ch.68, NYC Charter: • New York City attorneys also bound by Ch. 68, which governs conduct of City employees • Applies to all City employees of all City agencies Alex Corrections

8. II. Chapter 68 ofthe NYC Charter • City law which regulates conflicts between your public duties and private interests • Sets higher standard than that of the private sector • Sets minimum standard of conduct -- your own agency may set higher standards • Provides for an independent City agency to interpret and enforce: TheNYC Conflicts of Interest Board (“COIB”) Alex Corrections

9. FUNCTION OF CHAPTER 68 These prohibitions on the conduct of public servants are enacted to: • 1. protect the trust placed in public servants of the City; • 2. promote public confidence in government • 3. preserve the integrity of government-decision making; and • 4. enhance government efficiency Alex Corrections

10. PREAMBLE to Ch. 68 We the people...!! §2600 Preamble. Public service is a public trust. These prohibitions on the conduct of public servants are enacted to preserve the trust placed in public servants of the city, to promote public confidence in government, to protect the integrity of government decision-making and to enhance government efficiency. Alex Corrections

11. III. WHY DO I CAREABOUT CHAPTER 68? • Because you are an upstanding public servant • Because you wish to avoid unwitting violations of Ch. 68, which may result in - ACS disciplinary proceedings; and/or - Conflicts of Interest Board disciplinary proceedings: • civil penalties of up to $10,000 • criminal charges/proceedings (misdemeanor) • Because you want those 2 CLE ethics credits!! Alex Corrections

12. WHAT IS A WAIVER? • COIB sometimes authorizes an outside activity/job which may be prohibited by the letter of the law, but not the spirit of the law • The granting of a waiver upholds the spirit of the conflicts of interest laws • Job/activity must be in furtherance of the purposes and interests of the City • Requires ACS Commissioner approval • To seek waiver or waiver consult, contact ACS Legal Counsel Unit (can also contact COIB w/ option to remain anonymous) Alex Corrections

13. V. Primary Topics addressed by Ch. 68 & the Conflicts Board A. Gifts & Honoraria B. Misuse of City Office C. Outside Activities D. Post-Employment Restrictions E. Political Activities Alex Corrections

14. A. Gifts & Honoraria(Booklet pp. 49-58) • Conflict of interest may arise where public servant receives item of value from private individual or entity doing biz with City • Guidelines established to assist public servants in identifying which gifts and honoraria may be accepted Alex Corrections

15. A. Gifts (cont.)Charter §2604(b)(5) &COIB’s “Valuable Gift Rule” No public servant shall accept any “valuable gift” from person/firm the public servant knows is engaged in business dealings with the City… …except gifts which are customary on family or social occasions. “valuable gift” – defined as any gift, in any form, with value of $50 or more - Cummulative within 12 month period; e.g. two $25 gifts in a year = “valuable gift” Alex Corrections

16. A. Gifts (cont.)Gifts that Conflict w/ Official Duties In addition to above gift provision, other provisions also regulate gift acceptance and gift solicitation… …even if less than $50 and/or giver/donor has no City biz dealings §2604(b)(2) - public servant shall not engage in any business, transaction or private employment, or have any financial or other private interest, direct or indirect, which is in conflict with the proper discharge of official duties (“catch-all”) §2604(b)(3) - public servant shall not use or attempt to use position to obtain financial gain, privilege, etc., for public servant or person or firm associated with public servant Alex Corrections

17. Gifts (cont.)Permitted Gifts Subject to §§2604(b)(2) and (b)(3) above, okay to accept gifts from persons or firms doing biz with City in some circumstances: 1. Family & Social Occasions • Reason for gift must be family/personal relationship, and NOT the biz dealings • Receipt of gift would not result in appearance of conflict • e.g., must not appear to be using one’s office for personal/private gain, or giving preferential treatment to particular person/entity Alex Corrections

18. A. Gifts (cont.)Permitted Gifts (cont.) 2. Awards & Plaques – of no substantial resale value 3. Meals & Refreshments – generally okay in course of City biz where • the spread is not lavish; and/or • it would be impractical to decline (e.g., no other place/time to eat elsewhere; all other participants are partaking and continuing biz) 4. Invitations to Attend at Functions/Annual Events - sometimes ok, depends on many variables Alex Corrections

19. A. Gifts (cont.)Permitted Gifts (cont.) 5. Payment for Travel Related Expenses -may be acceptable “gift to City” if for City purpose, not lavish, not longer than necessary to carry out City biz, and approved by agency 6. Gifts to City for City Purpose -gifts from private entities doing biz with City may be okay if for City purpose, subject to restrictions -must adhere to solicitation/fundraising guidelines Alex Corrections

20. A. Gifts (cont.)Compensation/GratuitiesFrom Non-City Sources Charter §2604(b)(13) – no public servant shall receive compensation, except from the City, for performing any official duty or accept or receive any gratuity from any person whose interests may be affected by the public servant’s official actions Translation: No tips, gratuities or gifts for doing what the City already pays you to do! Alex Corrections

21. A. Gifts (cont.)Honoraria Guidelines Okay to accept honoraria and/or expenses, subject to following guidelines: • Cannot accept honorarium/expenses for an engagement before a group if it might appear that the group (or a member) might receive favorable treatment from the City • Amount must be reasonably related to services rendered • City managers’ paid speaking engagements must be limited in quantity to avoid appearance of neglecting public duties Alex Corrections

22. A. Gifts Honoraria Guidelines (cont.) • Amount received must not exceed 20% of annual salary • May not accept honoraria for speeches or appearances made as part of official duties e.g., must decline honorarium if speech is related to operations of own agency (remember, you can’t be paid by non-City source for doing your job) • May accept payment, on behalf of City, for reasonable and necessary expenses • requires Commissioner approval (contact Legal Counsel if unsure of proprietary of specific payment Exceptions: teaching/lecturing (see “Outside Activities”) Alex Corrections

23. Gifts (cont.)Office Collections/Solicitations Office Collections for gifts, social occasions, fundraisers, etc., should be carried out with caution: • Collection efforts should be unobtrusive, i.e., no one-on-one soliciting; no pressure on nonparticipants • Superiors MAY NOT solicit subordinates • Subordinates may solicit superiors ($25 max) • COIB Rule of Thumb: IT SHOULD BE AN OPPORTUNITY -- NOT A NECESSITY!! • May contact Legal Counsel Unit or COIB for consult Alex Corrections

24. A. Gifts (cont.)Additional Gift Rules • City agencies may have stricter rules than the Charter, but may not have more lenient rules than the Charter • Nothing in the Board’s “Valuable Gift Rule” authorizes violation of any applicable federal, state, or local law, rule or regulation • e.g., a stricter rule issued by the Mayor’s office, Mayoral Executive Order Number 16 – bribes must be reported; though you might not otherwise be required to report it under Ch. 68 Alex Corrections

25. Misuse of CityOffice/Resources • Public servants may not use their City office/position to gain advantage for themselves, immediate family or associates • Duty of undivided loyalty to City • May not use City time, letterhead, personnel, equipment, resources or supplies for non-City purposes • May not induce/cause other public servants to violate ethics/conflicts laws Alex Corrections

26. B. Misuse of Office/Resources (cont.)Use of City Office for Personal Gain Charter §2604(b)(3) - public servants may not use or attempt to use City position for financial gain, contract, license, privilege, or other private or personal advantage, direct or indirect, for themselves or any person or firm with whom they are “associated” e.g., political campaigning, running side biz, etc., using City time, resources and equipment Alex Corrections

27. B. Misuse of Office (cont.)Use of City Office for Personal Gain (cont.) “associated”- (appears in §2604(b)(3) • spouse, domestic partner, child, parent, or sibling; • person w/whom public servant has biz/financial relationship with • firm in which public servant has present or potential “interest” in “interest” – (appears in §2604(b)(2) [‘catch all”]) a) ownership interest of public servant, spouse or unemancipated child of 5% or $40,000; or b) position as employee, consultant, officer, director, trustee, attorney, agent, broker or manager Alex Corrections

28. C. Outside Activities Activities include moonlighting, volunteering, ownership interests • Charter laws and COIB guidelines apply both to paid and unpaid activities, albeit differently in some cases. • Your agency may impose stricter guidelines • ACS does! • Must notify ACS (Legal Counsel Unit) of all outside volunteer or employment activity • “conflicts of interest” assessment will be conducted Alex Corrections

29. C. Outside Activities (cont.) GENERAL PROVISIONS §2604(b)(2) - (“catch-all”) – don’t do anything that conflicts with your official duties §2604(b)(3) – (“misuse of office”) – don’t exploit your City position, or use City time/resources, for personal/private gain Alex Corrections

30. C. Outside Activities (cont.)GENERAL PROVISIONS (cont.) • A “misuse of office” violation could occur where public servant was involved with outside employer’s City dealings/biz • i.e., gives appearance of public servant seeking private advantage for an entity with whom he/she is “associated” Alex Corrections

31. C. Outside Activities (cont.)GENERAL PROVISIONS (cont.) • §2604(b)(6) – public servants prohibited from “representing” private interests for compensation before any City agency or from “appearing” anywhere, directly or indirectly, on behalf of private interests in matters involving the City. • “Appear” §2601(4) defines as any communication for compensation, other than re “ministerial” (nondiscretionary) matters. • “Represent” – COIB defines as acting as representative of someone to bring issues before a City agency Alex Corrections

32. Outside Activities (cont.)No Biz Dealings With City • Moonlighting – okay to work for person/firm with no City biz, subject to above charter provisions • Ownership Interests – okay to possess ownership interest in firm with no City biz, subject to above charter provisions • Volunteer Activities – okay to volunteer for not-for-profits with no City biz, subject to above charter provisions Alex Corrections

33. C. Outside Activities (cont.)BIZ DEALINGS WITH CITY Moonlighting – Regular Employees §§2601(12) & 2604(a)(1)(b) - no full-time public servant may have a position with a “firm” that public servant knows or should know is engaged in biz dealings w/ any City agency “firm” – §2601(11) defines as sole proprietorship, joint venture, partnership, corp. or any other form of enterprise, but shall not include public benefit corp., local development corp. or other similar entity Alex Corrections

34. C. Outside Activities (cont.)BIZ DEALINGS WITH CITY (cont.) Ownership Interests for Regular Employees §2604(a)(1)(b) – no f/t public servant may have “ownership interest” in “firm” that does biz with any City agency “ownership interest” - interest in firm held by public servant, spouse, domestic partner or unemancipated child, which exceeds 5% of the firm or an investment of $40,000, whichever is less… *Rule does not apply to publicly traded companies, except for those that do biz with public servant’s own agency Alex Corrections

35. C. Outside Activities (cont.)BIZ DEALINGS WITH CITY (cont.) Volunteering for Not-For-Profits w/ City Biz §2604(c)(6) - public servant may volunteer (unpaid) as an attorney, agent, broker, employee, officer, director or consultant for any not-for-profit entity, subject to certain conditions: - must recuse self from not-for-profit’s City biz - own agency must not have City biz w/ not-for-profit, unless ACS Commissioner determines proposed volunteer activity is in furtherance of the purposes and interests of the City (no COIB approval nec’y) Alex Corrections

36. C. Outside Activities (cont.)BIZ DEALINGS WITH CITY (cont.) Volunteering for Not-For-Profits w/ City Biz (cont.) - exception: do not need Commissioner approval if volunteer work at not-for-profit does not involve policy-making or administrative authority (COIB Advisory Opinion No. 98-8) e.g., okay to serve food in soup kitchen w/out approval Double recusal applies: may have no City dealings at not-for-profit position; may have no not-for-profit dealings at ACS/City job. Alex Corrections

37. C. Outside Activities (cont.)Waivers for Moonlighting & Volunteering §2604(e) – public servant may hold an otherwise prohibited position upon Commissioner’s written approval, and determination by COIB (i.e., waiver) that position would not conflict with purposes and interests of the City - COIB considers various factors, including hours, compensation, and any possible relationship between official duties and outside activities Alex Corrections

38. C. Outside Activities (cont.)Waivers for Moonlighting & Volunteering (cont.) • Upon obtaining waiver, public servant may accept position w/ firm • Still bound by standard restrictions re outside work - cannot use City time and resources for non-City purpose - cannot release confidential information obtained in course of City employment • Waivers usually include add’l restrictions • e.g., two-way recusal Alex Corrections

39. C. Outside Activities (cont.)Waivers for Moonlighting & Volunteering (cont.) Teaching Waivers - • Many public servants have been granted waivers to hold p/t and adjunct teaching positions • may not be paid to teach that which constitutes your official duties (i.e., can’t be paid to teach your job) - This is an area of some contention; determinations often difficult; call Legal Counsel and/or COIB re your particular situation!! Alex Corrections

40. C. Outside Activities (cont.)Waivers for Moonlighting & Volunteering (cont.) Teaching Waivers (cont.) • Almost all colleges within NYC conduct some biz with the City – therefore, waiver required • Exception: CUNY/SUNY schools do not require waiver because 1) these government institutions are not “firms” as defined in §2601(11) and 2) Alex Corrections

41. C. Outside Activities (cont.)SPECIAL SITUATIONS Private Practice of Law §2604(b)(7) - No public servant may appear as an attorney or as counsel against the interests of the City in any litigation in which the City is a party, or in any action or proceeding in which the City, or any public servant of the City, acting in the course of official duties, is a complainant. • Your agency may impose stricter policy • ACS does! Alex Corrections

42. C. Outside Activities (cont.)SPECIAL SITUATIONS (cont.) Private Practice of Law (cont.) ACS Policy - per ACS Memo, “Policy on Outside Practice” (10/7/98) (copy in hand-out) - may not engage in private practice of law without written approval of the General Counsel - applies regardless whether paid or unpaid - rarely granted; mainly for one-time transaction for relative - may not use City time or resources - some pro bono work may be approved if no conflict and does not involve use of City time/resources. Alex Corrections

43. C. Outside Activities (cont.)SPECIAL SITUATIONS (cont.) Financial Relationships – Superiors/Subordinates §2604(b)(14) – No public servant shall enter in any business or financial relationship w/ another public servant who is a superior or subordinate of such public servant e.g., joint biz ventures, borrowing money, landlord/tenant, cohabitation(?!?!) Alex Corrections

44. C. Outside Activities (cont.)SPECIAL SITUATIONS (cont.) Expert Testimony (cont.) §2604(b)(8) – prohibits public servant from giving opinion evidence as paid expert against interests of the City in civil litigation brought by or against the City. • Rules differ re p/t City employees Alex Corrections

45. C. Outside Activities (cont.)SPECIAL SITUATIONS (cont.) Independent Contracting & Other Freelance Work • Generally okay as long as no City time/resources used • If “ongoing relationship” with client firm which does biz w/ City, COIB waiver needed • May not use City position to obtain clients (misuse of office, §2604[b][3]) • May not provide services to City subordinate or superior (financial relationships between sub’s and sup’s is prohibited, §2604[b][14]) Alex Corrections

46. C. Outside Activities (cont.)SPECIAL SITUATIONS (cont.) Fundraising for Not-For-Profits • Generally okay • May not use City time and resources* • May not use City position to assist fundraising efforts* * Some exceptions where authorization obtained b/c efforts in furtherance and purposes of City Alex Corrections

47. Outside Activities (cont.) • Consult COIB (www.nyc.gov/ethics) for specific guidelines re: • Outside employment of p/t public servants • Ownership interests of p/t public servants • COIB “orders” allowing ownership interests • Ownership interests in coops and condos • Temporary Employment • Outside employment as architects, engineers, electricians, plumbers, planners, etc. (subject to City inspection) • City-related outside employment Alex Corrections

48. D. Post-Employment Restrictions(booklet pp. 87-99) • Applicable to all City employees (regardless of responsibility/discretion) who leave City for private sector • Purpose of restrictions to prevent: • former public servants from exploiting public office for personal gain; • subordinating City interests to those of prospective employer; or • exerting undue influence on government decision-making. Alex Corrections

49. Post-Employment (cont.) 4 Main Post-Employment Restrictions: Public Servants (current/former) may not: • Negotiate for job w/ private employer who is involved w/ particular matter public servant is working on in City job • Appear before one’s former City agency within one year after leaving City service (“one-year appearance ban”) • Work on a particular matter that public servant worked on personally and substantially as a City employee (“lifetime particular matter ban”) • Use or disclose confidential info gained in City service. Alex Corrections

50. D. Post-Employment (cont.) 1. Negotiating/Applying for Private Sector Job §2604(d)(1)– prohibits soliciting, negotiating for, or accepting position (a) that you would be prohibited from holding after leaving City service as per Charter’s post-employment provisions, or (b) with any person/firm involved in “particular matter” w/ City while you are involved in such matter - “particular matter” – basically means any matter, case, project, etc., but varies according to specific facts, including the nature of the matter and the nature of your involvement. Alex Corrections