AB 1234 Self-Study Opportunity, Part Two: Laws and Ethical Principles Related To Governmental Transparency and Fair Processes
This column is a service of the Institute for Local Government Ethics Project, which offers resources for local officials on public service ethics. For more information, visit www.ca-ilg.org/trust.
AB 1234 requires elected and appointed officials to take two hours of ethics training if they receive compensation for their service or are reimbursed for their expenses. The ethics training requirement may also apply to agency employees designated by the agency’s legislative body.
There are many ways to satisfy this requirement, including in-person training and self-study activities. Furthermore, like all ethics laws, AB 1234 is a floor, not a ceiling. Local officials can demonstrate their commitment to ethics in public service by going beyond AB 1234’s minimum requirements.
As a special service, Western City and the Institute for Local Government (ILG) are offering this article for one hour of AB 1234 self-study credit (or half of the minimum requirement). To claim self-study credit, log on to www.ca-ilg.org/AB1234selfstudy, print out and take the test, then mail it to the address indicated with the $25 processing fee. This fee covers grading the test, providing the correct answers (and explanations) and your proof of participation certificate; it
also supports ILG’s work in the public service ethics area.
Scope of This Self-Study Exercise
This article covers half of AB 1234’s required elements, including:
- Governmental transparency laws, including financial disclosure laws and laws protecting the public’s right to participate in meetings and access public records (the Brown Act and Public Records Act); and
- Laws related to fair processes, including common law bias, due process, incompatible offices, competitive bidding requirements for public contracts, and disqualification from participation in decisions involving family members.
The April 2006 “Everyday Ethics” column covered the balance of AB 1234’s requirements, including:
- Laws related to personal financial gain by public officials (including bribery and conflict of interest laws); and
- Laws related to office-holder perks, including gifts and travel restrictions, personal and political use of public re-sources, and prohibitions against gifts of public funds.
Note that public service ethics laws are extraordinarily complex. The learning objective of both self-study and in-person AB 1234 training courses is to familiarize local officials with when they need to consult agency counsel, the attorney general or the Fair Political Practices Commission (FPPC) about a given situation or course of action.
The principle underlying the governmental transparency laws is that the public trusts what it can observe. Furthermore, the prospect that actions will be publicly known can be a deterrent against actions that might undermine public trust. Thus, the laws in this area are designed to promote the general ethical values of trustworthiness and responsibility.
There are two basic categories of transparency laws. One relates to activities of the individual official. For example, these laws require specified officials to periodically disclose their personal financial interests (so the public can assess whether those interests played a role in the official’s decisions). They also require officials to disclose campaign and charitable fund-
The other kind of transparency laws require governmental processes to be transparent to the public. These laws require that governmental decisions bemade in public and that the public has the opportunity to weigh in on those decisions. They also require that most public records be open to public inspection.
This self-study exercise discusses both kinds of transparency laws.
Financial Disclosure Laws
There is an adage about one’s life being an open book. Nowhere is this truer than for public officials and their finances. When you become a public official, the public gets to learn a great deal about your financial life. California voters created these disclosure requirements when they approved the Political Reform Act in 1974.
The disclosure requirements apply to nearly every local elected official and department head. Members of commissions, boards, committees and other local agency bodies with significant decision-making authority are also subject to disclosure requirements. An agency may require additional staff positions to disclose their economic interests under the agency’s local conflict of interest code. Such employees are known as “designated employees.”
The following kinds of economic interests must be disclosed if they meet certain minimum thresholds:
- Sources of income;
- Interests in real property;
- Business positions; and
This disclosure is made on forms called “Statements of Economic Interests” and “Form 700.” Copies of these forms are generally provided by one’s agency. Interactive versions of the forms are available online at www.fppc.ca.gov.
These forms are filed upon assuming office, on an annual basis while in office and upon leaving office.
Charitable Fund Raising
The disclosure laws are not limited to an official’s personal financial interests. There are extensive disclosure requirements relating to an official’s campaign fund-raising activities, of course. However, a sometimes-overlooked disclosure obligation relates to an official’s charitable fund-raising activities. The theory is that the public has a right to know who is contributing to an elected official’s favorite charities and other causes.
This disclosure requirement is triggered when an elected official gets someone to contribute $5,000 or more to a legislative, governmental or charitable cause during a calendar year. Within 30 days of reaching the $5,000 threshold, the elected official must file a report with his or her agency (typically with the filing officer).
Conducting the Public’s Business In Public
California’s open meeting laws provide legal minimums for local governmental transparency in decision-making. Decision-making bodies — which include the governing board as well as many committees and advisory bodies — must conduct their business in an open and public meeting to ensure that the public is fully informed about local decisions.
Key things to keep in mind include:
- Meetings. A “meeting” is any situation involving a majority of the governing body in which business is transacted or discussed. In other words, a majority of the governing body cannot talk privately about an issue for consideration before the body no matter how the conversation occurs, whether by telephone, e-mail or at a local coffee shop.
- Serial Meetings. One thing to watch out for is unintentionally creating a “serial” meeting — a series of communications that results in a majority of governing body members having conferred on an issue. For example, if two members of a five-member governing body consult outside of a public meeting (which is not in and of itself a violation) and then one of those individuals consults with a third member on the same issue, a majority of the body has consulted on the same issue. Note the communication does not need to be in person and can occur through a third party. For example, sending or forwarding e-mail can be sufficient to create a serial meeting, as can a staff member polling governing body members in a way that reveals the members’ positions to one another.
- Permissible Gatherings. Not every gathering of governing body members is a problem. For example, a majority of the governing body may attend the same educational conference or a community meeting not organized by the local agency. Nor is attendance at a social or ceremonial event in and of itself a violation. The key rule to keep in mind is a majority of the governing body members cannot meet and discuss agency business except at an open and fully noticed public meeting.
- Closed Sessions. The open meeting laws include provisions for nonpublic discussions under very limited circumstances. Because of the complexity of the open meeting laws, close consultation with an agency’s legal advisor is necessary to ensure that the requirements related to and the limitations on closed sessions are observed.
The Public’s Right to Participate In Meetings
Another element of open meeting laws is the public’s right to address the governing body. A public official’s role is to both hear and evaluate these concerns, and there are a number of basic rules that govern this right, such as:
- Posting and Following the Agenda. The open meeting laws require that the public be informed about the time of and the issues to be addressed at each meeting.
- The Public’s Right To Be Heard. Generally, every agenda must provide an opportunity for the public to address the governing body on any item of interest to the public within the body’s jurisdiction. If the issue of concern is one pending before the legislative body, the opportunity must be provided before or during the body’s consideration of that issue.
- Reasonable Time Limits May Be Imposed. Local agencies may adopt reasonable regulations to ensure that everyone has an opportunity to be heard in an orderly manner.
The Public’s Right to Access Records
Copies of the agenda materials and other documents distributed to the governing body must also be available to the public. The public has the right to see any materials that are created as part of conducting the people’s business. These materials include any written item that was prepared, owned, used or retained by a public agency. They include documents, computer data, e-mails, facsimiles and photographs.
Although there are exceptions to a public agency’s duty to disclose records, the safe assumption is that virtually all materials involved in one’s service on a public governing body — including e-mails — are public records subject to disclosure.
Fair Process Laws
Not surprisingly, fair process laws promote the ethical value of fairness. This is the concept that everyone has a right to be treated fairly by governmental processes, regardless of who they are or know. The public’s perception that decisions are made fairly is a key element of the public’s confidence and trust in government and individual public officials.
The Obligation To Be a Fair and Unbiased Decision-Maker
Although California statutes largely determine when public officials must disqualify themselves from participating in decisions, common (judge-made) law still requires a public official to exercise his or her powers free from personal bias — including biases that have nothing to do with financial gain or loss.
In addition, constitutional due process principles require a decision-maker to be fair and impartial when the decision-making body is sitting in what is known as a “quasi-judicial” capacity. Quasi-judicial matters include variances, use permits, annexation protests, personnel disciplinary actions and licenses. Quasi-judicial proceedings tend to involve the application of generally adopted standards to specific situations, much as a judge applies the law to a particular set of facts.
For example, a court overturned a planning commission’s decision on due process grounds, concluding that a planning commissioner’s authorship of an articlehostile to a project before the commission gave rise to an unacceptable probability of bias against the project.
Typically, having the official who may have exhibited bias disqualify himself or herself solves the problem. If the problem is not addressed, though, the agency’s decision will be at risk of being overturned by the courts. The agency will have to conduct new proceedings free of the influence of the biased decision-maker. If the violation rises to the level of a denial of due process under constitutional law, the affected individual(s) may seek damages, costs and attorneys’ fees.
Finally, community relations — and the public’s views of an official’s responsiveness — are seriously undermined when it appears an official is not listening to public input. Even if you disagree with the views being offered, treat the speaker with the same respect you would want if the roles were reversed. Furthermore, at least one court has ruled that officials’ perceived inattentiveness during a hearing violated due process principles.
Campaign Contributions and Bias
Generally, the ethics laws with respect to campaign contributions emphasize disclosure rather than disqualification. The emphasis on disclosure enables the public to assess for itself the degree to which an official could be influenced by campaign contributors who appear before the agency. Both financial and in-kind support must be disclosed.
However, under limited (and sometimes counterintuitive) circumstances, certain local agency officials must disqualify themselves from participating in proceedings regarding licenses, permits and other entitlements for use if the official has received campaign contributions of more than $250 during the previous 12 months from any party or participant. The res-trictions apply if the official is sitting on an appointed (as opposed to elected) body.
In addition, these officials are prohibited from receiving, soliciting or directing a campaign contribution of more than $250 from any party or participant in a license, permit or entitlement proceeding while the proceeding is pending and for three months after the contribution.
Holding Multiple Public Offices
There is such a thing as too much public service; the law limits the degree to which public officials can hold multiple public offices. The reason is that when one assumes a public office, one takes on responsibility to the constituents of that agency to put their interests first. When one occupies multiple offices in multiple agencies (for example, membership on the city council and serving on the board of another local agency), that role becomes more complicated because of the possibility of conflicting loyalties.
Offices are incompatible if there is any significant clash of duties or loyalties between the offices or if either office exercises a supervisory, auditory or removal power over the other. Note there can be specific legislative exceptions to incompatible office rules.
Competitive Bidding Processes for Public Contracts
Public contracting laws — including those adopted at the local level — are designed to give all interested parties the opportunity to do business with the government on an equal basis. This keeps contracts from being steered to businesses or individuals because of political connections, friendship, favoritism, corruption or other factors. It also ensures that the public receives the best value for its money by promoting competition among businesses.
Many competitive bidding requirements are locally imposed; for example, by charter cities as part of their municipal affairs authority. State law also authorizes local agencies to adopt procedures for acquiring supplies and equipment. Most of these purchasing ordinances require competitive bids for contracts in excess of designated dollar amounts.
For public works projects, state law defines when general law cities and counties must use competitive bidding. For general law cities, public works projects of more than $5,000 are subject to the state’s competitive bidding requirements. For county projects, the threshold is based on population: $6,500 (counties with populations of 500,000 or more); $50,000 (counties with populations of 2 million or more); and $4,000 (all other counties). Note that it is a misdemeanor to split projects to avoid competitive bidding requirements.
In order to give all interested parties an opportunity to do business with the agency and get the best price for the public, the agency has to publicize the opportunity. This is typically accomplished by publishing a notice inviting bids in a newspaper of general circulation that is printed or published in the jurisdiction, or if there is none, posting the notice in at least three public places in the jurisdiction. Trade publications can also be a helpful way to reach a wide segment of the contracting industry.
Decisions Involving Family Members
The Political Reform Act requires public officials to disqualify themselves from participating in decisions that will increase or decrease their immediate family’s expenses, income, assets or liabilities. “Immediate family” includes one’s spouse or domesticpartner and dependent children. The notion is that it’s very difficult for any person to be fair and unbiased when one’s family’s interests are concerned; of course, it’s also difficult for the public to perceive the official to be fair and unbiased about close family members.
Because of this, some jurisdictions have adopted additional restrictions on hiring or appointing relatives of public officials. These are known as anti-nepotism policies. It can be wise to avoid questions about family relationships by voluntarily not participating in decisions that affect family members, even if the law or local agency regulations allow you to participate.
Beyond the Law
At some point in your service as a public official, you will likely face two common types of ethical dilemmas:
- Personal Cost Ethical Dilemmas. This involves situations in which doing the right thing may (or will) come at a significant personal cost to you or your public agency. These also can be known as “moral courage” ethical dilemmas.
- Right-Versus-Right Ethical Dilemmas. This type of ethical dilemma involves those situations in which there are two conflicting sets of “right” values.
Of course, some dilemmas are a combination of both: a conflict between competing sets of “right” values (right versus right) and a situation in which doing the right thing involves personal or political costs.
Personal Cost Ethical Dilemmas
With these kinds of dilemmas, the costs can be political — such as the loss of a political supporter or perhaps even one’s prospects for re-election. Or the cost can be financial; for example, a missed opportunity for financial gain or material benefit. Issues related to the proper use of public resources fall into the “personal cost” type of ethical dilemma, inasmuch as these dilemmas typically involve whether one is going to forgo a tempting political or personal benefit. Finally, the cost can be more directly personal; for example, when one fears a particular course of action may jeopardize a friendship or one’s job. In these situations, the answer is relatively simple. The bottom line is that being ethical means doing the right thing regardless of personal costs.
Right-Versus-Right Ethical Dilemmas
Right-versus-right ethical dilemmas can be more difficult to resolve. An easy example, however, is when a political supporter urges you to do something that conflicts with your own best sense of what will serve your community’s interests. In this dilemma, there is a conflict between your responsibility to do what is in the public’s best interest and your loyalty to your political supporter. Responsibility and loyalty are both bona fide ethical values.
The key is, as a public servant, the ethical value of responsibility (and the responsibility to do what is in the public’s best interest) trumps the ethical value of loyalty. This is when thinking about the public’s perception of the right thing to do can be a useful dilemma-resolution strategy.
The Means and the End
In politics, there is a great temptation to engage in ends-means thinking in which one might be persuaded to conclude that good or desirable ends justify the means. As both Dr. Martin Luther King Jr. and Mahatma Gandhi observed, the means are the end in a democracy and good ends cannot come from questionable means.
Public officials are stewards of the public’s trust in both their institutions and their leaders. A fair and open process is central to that trust. As a leader, conscientious attention to laws and principles of fair and open government will help you pursue both good means and good ends.
For More Information
The following resources offer more information about ethics laws and principles.
California Attorney General Publications (click on “Ethics’’)
Fair Political Practices Commission Publications
Institute for Local Government Ethics Resource Center