Untitled Texas Attorney General Opinion ( 1993 )

QBfficeof tip IZlttornepGeneral
&ate of Qtexa$
DAN MORALES
ATTORSEY
GENERAL October25.1993
Honorable Liiby Linebarger Opinion No. DM-267
Chair
Public Education Committee Re: whether wntlicts of interest exist
Texas House ofRepmsem&es thatwoulddiqual@rspousefromserving
P.O. Box 2910 in elected office when both spouses hold
Austin, Texm 78768-2910 elected positions in kd govemmd
bodies with overlapping jutisdictional
.
tmndaries and one jurisdiction Is
responsiile for 8 portion of the annual
budget of the other governments) body,
uld related questions (IQ566)
Your request for an opinion involves a married couple’s possible wnflicts of
interest when each spouse holds elected office in a local governmental body whose
jurisdictional boundary overlaps with that of the other body and one govemmanal body is
responsiile for a portion of the annual budget of the other body. You explain that one
spouse is an elected director of a state cotion district (“CD”) opemting under its
enabling legislation and chapters 50 and 52 of the Water Code. The CD derives its
~esfiom”userfees”~onpum~efromwdlsinthecD. About4Opercentof
theusafee~eswme~mwellsthat~locatedinacatainci~(“thtcity”)whose
jurisdiction partially overlaps that of the CD. The directors of the CD do not receive a
salary, but they are entitled to a per diem for meeting attendance. which per diem this
spousealwayshasdeclined. Theothaspouseisamanberofthecitycouncilofthecity
and receives an atmual s&y as a wuncil member. You ask whether, under the foregoing
&US,either spouse would be disqua%ed from 05ce because of a wngict of interest.
Each spouse is a “@]d public official,”that is, “a member of the governing
body.. .ofanydistrict . . . . municiprdity,... or other local govemmental entity,” Local
CWt Code g 171.001(1). and as such is subject to the rules regarding conflicts of interest
codified in chapter 171 of the Local Government Code. Under chapter 171 “a local public
official [who] has a substantisj interest in a business entity or in real property” must in
certaininstsnces
file [with the official record keeper of the governmental entity],
before a vote or decision on any matter involving the business entity
p. 1398
HonorableLibby Lmebsrger - Page 2 (DM-267)
or the real property, an &Ed&t stating the nature and extent of the
interest and . . abstsin from 5rther participation in the matter.
Id. 5 171.004(a)(l)-(2). (b). Chapter 171 provides for disclosure and abstention but
does not disqualiQ local public officialsfrom office.
Your hcts do not suggest that any real property interest is involved here, but you
do mention that one spouse receives a salary as a city council member and that the other
has declined the per diem for meetings of the CD. These fncts suggest that we consider
whether either spouse hss a substantial interest in I business entity for putposes of chapter
171. In that chapter a “‘[b]usinessentity means a sole proprietorship, paRwmhip, firm,
wrpodon. holding wmpany, joint-stock wmpany, receivership, trust, or any other
entity recognized by law.” Id. 8 171.001(2). *[A] person has a substamisl interest in a
business entity if: . . .5nds received by the person from the business entity exwed 10
percent of the person’s gross income for the previous year.” Id. 5 171.002(a)(2).
Therefore, the city wuncii member spouse has a substwtial interest in a business entity if
the city is a business entity and if the money received from the city exceeds 10 percent of
that spouse’s income last year. Further. if the city council member has a substsntial
interest in a business entity by virtue of the salary from the city, then the other spouse also
hss a substantial interest in a business entity because of that person’smarital relationship to
the wuncil member. See id. 5 171.002(c) (local public official has substantial interest if
person related to that official in 5st degree of wnmnguinity or a5nity has substantial
interest).
There is no precedent on whether a city is a business entity for purposes of chapter
171. In Attorney General Opiion JM-852 (1988) we concluded by application of the rule
of ejur&m generis to the detinition of “business entity” in section 171.001(2) that a state
university is not included within that definition as “any other entity recognized by law”
because it is a public entity and its purpose is wt to produce 5tancial benefits for private
persons. Attorney Geneml Opiion IM-852 at 34. The same rule of construction shows
that a city is not a “businessentity.” A city is, rather, “[a] political entity or subdivision for
local govemment8l purposes.” BLACK’SLAWDICI~ONARY 244 (6th ed 1990). We
conclude, therefore, that neither spouse has a substamial interest in a business entity under
chapter 171 by virtue of one spouse’ssalary income from serving as a member of the city
wuncil. Nor do any of the other facts you have offered suggest any substantial interest in
a business entity that would invoke the application of chapter 171.
You ask whether the spouse that is a director of the CD may accept the per diem.
We see no reason under the fads you have givw that the director spouse should not
ciccepttheperdiem.
You also ask what restrictions apply if the spouse who is a director of the CD also
is an employee of a conservation and reclamation district. Your question raises the issue
of dual office holding. Article XVI, section 40 of the Texas Constitution prohibits the
holding by one person of “more thw one civil office of emolument.” The wnstitutional
p. 1399
HonorableLibby Lmebarger - Page 3 (DM-267)
prohibition against dual 05ce holding thus generally would apply under these facts only if
both the position at the wnsmgtion and reclamation district and the directorship of the
CD are “civil offices of emolument.” You do wt present us any details wnceming the
nature of the CD directofs “employment”at the conservation and reclamation district, so
we accept as fact that the position at the wnmrvation and reciamation district is an
employment and not a “civiloffice.” See Akii?reIn&p. Sch. Dist. v. Standley, 280 S.W.Zd
578,583 (Tex. 1955) (decisive factor distinguishingpublic officer from public employee is
“whether any sovereign fimction of the govermnent is wnferred upon the individual to be
exercised by him for the benefit of the public &r&v independnt of the control of
athers”) (quoting Dunbar v. Bmzoria Count, 224 S.W.2d 738,740-41 (Tex. Civ. App.-
Galveston 1949, writ refd), with emphasis supplied by Akfine court). Under these
circumstances, the prohibition of article XVI, section 40, against dual office holding does
not apply to the spouse who is a director of the CD and an employee of a conservation
and reclamation district.
Another potential bar to dual office holding is the wmmon-law doctrine of
inwmpatibiiity. See State ex rel. Brennan v. Mbrtin, 51 S.W.2d 815, 817 (Tex. Cii.
App.-San Antonio 1932, no writ) (statement of doctrine). In general, inwmpatiiity may
arise when one person serves as an officer for two diRerent govemmemal entities, or when
one person serves as an officer and employee for the same governmentdentity. See
Attorney Oenersl Opinion JM-203 (1984) at 7-l 1. But see Attomey Gcneml Opiion
JM-1047 (1989) at 5-6 (incompatibility prevents one person from serving as justice of
peace.and as jailer in same county). Because we do not have any details wnwming the
nature of the CD director’s employment at the wnservation and reclamation district, we
cannot determine whether the two positions are incompatible.
Fiiy, you ask what possible wnflicts of interest there are mgarding voting on
issues gamane to either governmental body by either official. ,We can answer this
question only by referring you generally to chapter 171 of the Local Government Code
and the case law and attorney genera) opinions wnstruing it. We invite you to submit a
new request if you have a particular issue you wish us to consider in this regard.
p. 1400
Honorable Libby Linebarger - Page 4 W-267)
SUMMARY
A city is not a “lniness entity” for purposes of chapter 171 of
the Local Oovemment Code. Tlte prohibition of article XV& section
40 of the Texas Constitution against dual office holding does not
applytoaperson~oisbothadirectorofrstateconservation
district 8nd 8 mere employee of 8 wnserwtion and reclamation
district.
DAN MORALES
Attorney Oeneml of Texas
WILL.PRYOR
Fii Asshnt Attorney General
MARYKELLER
Deputy Attorney Gend for Litigation
RENEAHICKS
St8te Solicitor
MADELEINE B. JOHNSON
Chair, Opiion Committee
Prepared by James B. Pinson
Assisttmt Attorney General
p. 1401