03-E Hist Pres.Comm. (10/14/02) - Laserfiche WebLink

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October 14, 2002 Page 14 of 35 The second perhaps is not as well defined. The second matter that I want to talk with you about which is Item 8B on your agenda has to do with conflicts of interest. And that is this handout here: the Basic Principles of Conflicts of Interest. I was able to get the basic principles on a single page but not to do so without providing you with three or four pages of attachments. Let me tell you what this is and the conflict of interest or sometimes it is called adverse interests, ethics, whatever. There is less law or the law is less exact in defining this issue but it is somewhat related in the concept that you have in open meetings. That is the purpose of each board, each commission is to conduct their affairs in a manner that is fair to both parties. I think if you let the matter of fairness be your guide in what you do it will be very difficult for you to go wrong. I think that is the point that I am making in item number one, basic goal of conflict of interest and ethics statutes, is to assure that all proceedings of every public body are conducted in a manner that is fair and equitable to all parties concerned. As a consequence commission members must avoid conflicts of interests whether direct or perceived. Conflicts of interest, and this is a very general definition in the general sense, means that a board or commission member has an interest whether monetary or otherwise which would appear to preclude the commission member from making an unbiased decision that would force the commission member to vote against his or her own interest. There is a lot of heavy hardware in there. But it is very simply that there are means or ways that your conflict of interests should be avoided in making your decision. There are three sources of rules and regulations governing conflicts of interest. There is some state law. There is the city charter, and then there is what called common law. The state law provisions of conflicts of interests are found in Chapter 171 of the Local Government Code; which I apologize I think is the latter part of your handout beginning with this funny looking, legalistic type of material. Skip the charter page for a moment and focus on these materials. This is Chapter 171 out of the Local Government Code. What it basically says, if you look at it, is that it defines a local public official which by the way you are by providing service on this board for purposes of this statute but not for every statute you are considered a local public official because you are a member of a local governmental entity and you exercise responsibility beyond those that are advisory in nature. What this precludes is what is called a controlled situation of a"substantial interest in business entity." That is on page 336 on the second page of that handout, that portion of the handout. Under Section 171.002, a person shall have a substantial interest in a business entity if that person owns 10% or more of voting stock or shares of this entity or 10% or more or $15,000 or more of the fair market value of the business entity; or funds received by the person from the business entity exceed 10% of the person's gross income for the previous year. Understand I did not write this. The legislature wrote this. I make no apologies for how clear or readable it is. The person has substantial interest in real property, that is real estate, if the interest is an equitable or legal ownership of the fair market value of $2,500.00 or more. If you have the kind It also applies to a person who is related to the public official in what is called the first degree of consanguinity or infinity. I am not going to tell you what that is today other than you