Cultural Council Agenda and Packet 2015 01 15

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Those entrusted with positions in the City government must commit to adhering to the letter and spirit of the Code of Ethics. Only when the people are confident that those in positions ofpublic responsibility are committed to high levels of ethical and moral conduct, will they have faith that their government is acting for the good of the public. This faith in the motives of of- ficers, public body members, and employees is critical for a harmonious and trusting relationship between the City government and the people it serves. The City's Code of Ethics (Sections 5 -6 though 5 -17 of the Charter) is summarized in the following paragraphs. While the focus is to provide a general overview of the rules, it is impor- tant to note that all persons subject to the Code of Ethics must strive to follow both the letter and the spirit of the Code, so as to avoid not only actual violations, but public perceptions of violations. Indeed, perceptions of violations can have the same negative impact on public trust as actual violations. Conflicts of Interest One of the most common ethical rules visited in the local government arena is the "conflict of interest rule." While some technical aspects of the rule are discussed below, the general rule under the Code of Ethics is that if a Council, Board, or Commission member has an "interest" that will be affected by his or her "official action," then there is a conflict of interest and the member must: •Disclose the conflict, on the record and with particularity; • Not participate in the discussion; •Leave the room; and • Not attempt to influence others. An "interest" is a pecuniary, property, or commercial ben- efit, or any other benefit the primary significance of which is economic gain or the avoidance of economic loss. However, an "interest" does not include any matter conferring similar benefits on all property or persons similarly situated. (There- fore, a City Council member is not prohibited from voting on a sales tax increase or decrease if the member's only interest is that he or she, like other residents, will be subject to the higher or lower tax.) Additionally, an "interest" does not include a stock interest of less than one percent of the company's out- standing shares. The Code of Ethics extends the concept of prohibited inter- est to persons or entities with whom the member is associated. In particular, an interest of the following persons and entities is also an interest of the member: relatives (including persons related by blood or marriage to certain degrees, and others); a business in which the member is an officer, director, em- ployee, partner, principal, member, or owner; and a business in which member owns more than one percent of outstanding shares. The concept of an interest in a business applies to profit and nonprofit corporations, and applies in situations in which the official action would affect a business competitor. Addition- ally, an interest is deemed to continue for one year after the in- terest has ceased. Finally, "official action" for purposes of the conflict of interest rule, includes not only legislative actions, but also administrative actions and "quasi-judicial" proceed- ings where the entity is acting like a judge in applying rules to the specific rights of individuals (such as a variance request or liquor license). Thus, the conflict rules apply essentially to all types of actions a member may take. Contracts In addition to its purchasing policies and other rules intend- ed to secure contracts that are in the best interest of the City, the Code of Ethics prohibits various actions regarding con- tracts. For example, no public body member who has decision - making authority or influence over a City contract can have an interest in the contract, unless the member has complied with the disclosure and recusal rules. Further, members are not to appear before the City on behalf of other entities that hold a City contract, nor are they to solicit or accept employment from a contracting entity if it is related to the member's action on a contract with that entity. Gifts and Nepotism The Code of Ethics, as well as state law, regulates the receipt of gifts. City officials and employees may not solicit or accept a present or future gift, favor, discount, service or other thing of value from a party to a City contract, or from a person seeking to influence an official action. There is an exception for the "occasional nonpecuniary gift" of $15 or less, but this exception does not apply if the gift, no matter how small, may be associated with the official's or employee's official action, whether concerning a contract or some other matter. The gift ban also extends to independent contractors who may exercise official actions on behalf of the City. The Code of Ethics also prohibits common forms of nepo- tism. For example, no officer, public body member, or em- -6-