New York State
Ethics Commission


Advisory Opinion No. 93-13: Application of Public Officers Law §73(8) to a former State employee; what "directly concerned and personally participated" or "active consideration" mean; whether volunteer service at the request of the former State agency is allowable.

Introduction

The following advisory opinion is issued in response to an inquiry from [a former employee of the Executive Chamber] requesting advice on the application of the post-employment restrictions of Public Officers Law §73(8) to his anticipated activities.

Pursuant to the authority vested in the New York State Ethics Commission ("Commission") by Executive Law §94(15), the Commission hereby renders its opinion that (1) the lifetime bar of Public Officers Law §73(8) may appropriately be applied to services rendered before Congress and federal branch agencies; (2) that to invoke the lifetime bar, the former employee must have been directly concerned with and personally participated in or actively considered the transaction while in State service, which is not found here; and, finally, (3) that the described uncompensated service by a former State employee on a State task force reporting to his former State agency subsequent to his termination from State service does not violate the post-employment proscriptions of Public Officers Law §73(8).

Background

[The requesting individual served in] the Executive Chamber. [He] submitted an inquiry on the application of the post-employment restrictions of Public Officers Law §73(8) to his circumstances. He indicated he would be leaving State service as of [ ] to join the law firm of [ ]. He also indicated plans to sign a consultant contract with [ ] a New York State corporation that provides information regarding the availability of federal research and development grants to its clients. [He] described a variety of services he intends to provide and requested Commission review and approval. The Commission responded by informal opinion on March 22, 1993, to most of his questions and reserved ruling on others for a formal opinion. [He] requested the Commission address all his inquiries in a formal opinion and supplied additional information through telephone conversations with staff and by letter on [ ].

Areas of inquiry.

  1. As a partner at [the private law firm, the requesting individual] may be retained to represent local governments or State authorities that he previously worked with on issues before Congress and federal agencies. For example, he had discussions and meetings with Congressional representatives and administration officials on behalf of the State Job Development Authority ("JDA"). [He] inquires whether he may represent JDA on particular Congressional or federal administrative matters in the future.

  2. [The private law firm] currently serves as bond counsel to several New York State agencies and authorities. [The requesting individual] has never been an employee of any such bond issuing agency or authority and asks whether his active involvement as [a partner in the law firm] could pose any §73(8) problems.

  3. The State created the Excelsior Fund to review and approve economically targeted investment programs. Pension managers and State officials sit on the board of the Excelsior Fund and make judgments on investment applications. [The requesting individual] has not served as an officer or employee of any State or city pension fund or the Excelsior Fund and asks whether he may represent [the law firm's] clients, investment bankers, before the funds. [He] offered the examples of attempting to secure funds to underwrite ventures in developing countries or assisting the transition of defense industries to commercial construction.

  4. [The requesting individual] wishes to serve as consultant to [ ] an independent not-for-profit corporation that provides services to the higher education community, particularly on sponsor funding and systems for sponsored funds administration. [The not-for-profit corporation] may seek to provide services to State agencies, specifically the Science and Technology Foundation ("Foundation") and regional Technology Development Organizations that receive financial support from the Foundation. [The requesting individual's] services would include providing advice on marketing, product design, pricing and delivery of computer-based information on available public and private sector research projects to individual firms that belong to a Technology Development Corporation. [He] concludes that since he never served as an officer or employee of the Foundation, he should not be barred from receiving a share of proceeds from [the not-for-profit corporation] for services rendered to the State agencies.

  5. [The requesting individual] would represent the interests of private and public sector clients, including firms with which he worked on issues "of mutual concern" during his tenure in the Executive Chamber. For example, [in his State position] he had numerous conversations and meetings with federal officials in the legislative and executive branches regarding the enactment and implementation of federal defense conversion programs. In those conversations, he raised the concerns of New York State government and New York-based defense firms. At [the private law firm], he may be retained by particular New York State defense firms to advance their interests in Washington. [He] writes, "[b]ecause I will be representing these clients before federal agencies and Congress, not before the State, I believe these activities are not prohibited by New York's Public Officers Law."

  6. The Governor announced the creation of the Task Force on [ ] in his 1993 State of the State message. The Task Force is to make recommendations to the Governor on how New York can further the growth of new industries in the State. The Task Force membership will include select members of the Governor's cabinet and private sector. [The requesting individual] was named [to the Task Force]. The Task Force will evaluate proposals to help develop new industries in the State and attract federal research and development funding to public and private research institutions in New York. [The requesting individual] asks whether, since the Task Force serves in an advisory capacity only, he is barred from representing clients before State energy, environmental and scientific agencies and authorities during his tenure [ ].

Applicable Law

Public Officers Law §73(8) provides in part:
No person who has served as a state officer or employee shall within a period of two years after the termination of such service or employment appear or practice before such state agency or receive compensation for any services rendered by such former officer or employee on behalf of any person, firm, corporation or association in relation to any case, proceeding or application or other matter before such agency. No person who has served as a state officer or employee shall after the termination of such service or employment appear, practice, communicate or otherwise render services before any state agency or receive compensation for any such services rendered by such former officer or employee on behalf of any person, firm, corporation or other entity in relation to any case, proceeding, application or transaction with respect to which such person was directly concerned and in which he personally participated during the period of his service or employment, or which was under his or her active consideration.

Discussion

For purposes of the two year bar of §73(8), [the requesting individual's] former agency is the Executive Chamber. The Commission shall discuss below the implications of §73(8) for [his] anticipated activities after he leaves State service.

(1) Representing local governments or State authorities before Congress and federal agencies.

The two year bar would not apply as the proposed services would be before Congress and federal agencies, not the Executive Chamber.

It must next be determined whether such services would violate the lifetime bar. [The requesting individual] stated that, while he may have worked with the State authorities in the past, his [law firm] role would be to represent them only on issues different from those with which he dealt while in State service. He further indicated he did not represent local governments while in State service.

If [the requesting individual] renders services only on new matters, whether for local governments or State authorities, he would not run afoul of the post-employment restrictions. If he needs advice on whether a particular case, proceeding, application or transaction is the same as one with which he was directly concerned and in which he personally participated or was under his consideration while in State service, he should contact the Commission and seek specific advice.

(2) Serving as bond counsel to State agencies.

[The requesting individual] stated he never was an employee of a State bond issuing agency or authority nor did work on bond issues while [in State service.] The two year bar does not apply as the proposed services would be before State agencies and authorities other than the Executive Chamber. Any bond counsel services [he] renders would not violate the lifetime bar, as he never performed bond counsel work or work related to bond issues in his State position.

(3) Representing investment bankers who seek to manage economically targeted investment programs of State and city pension funds.

The two year bar does not apply as the proposed services would not be before the Executive Chamber, only other State and city agencies. [The requesting individual] indicated that in his position [ ] he had no job responsibilities with the Excelsior Fund or any State or city pension fund. Based on [his] foregoing assertions of his lack of involvement with the subject matter area or pension funds, he would not violate the lifetime by rendering related services in his new job.

(4) Providing advice on marketing, product design and price for [the not-for-profit corporation].

The two year bar would not apply unless he were somehow to represent [the not-for-profit corporation] before the Executive Chamber within two years of termination from State service.

Concerning the lifetime bar, [the requesting individual] indicated that, while [in State service], he had no role with the Science and Technology Foundation securing [the not-for-profit corporation's] information on available federal research and development funding. Assuming [he] renders services for [the not-for-profit corporation] on new issues and ideas different from any on which he was directly concerned and in which he personally participated or which was under his active consideration while [in State service], he would not violate the lifetime bar.

(5) Lobbying Congress and executive branch agencies on issues such as the enactment and implementation of federal conversion programs or other issues which were "of mutual" concern while [in State service].

[The requesting individual] supplied information that during his last year as [in State service] he lobbied extensively concerning how to structure a program to allocate $1 billion of federal funds to help defense firms to convert to other production. On behalf of New York State, he helped develop and supported a plan which would allocate block grants to states for distribution, rather than centralizing administration in a federal agency, to assure greater flexibility and access to small and medium-sized defense firms. [He] prepared text for the Governor to present to the House and Senate Armed Services Committees. [He] indicated that he did not address federal officials on behalf of any individual firms. As it happens, the Congress passed the 1993 Defense Appropriations Act ("Act") which adopted an approach different from the one [he] advocated. As a result the federal departments of Defense, Commerce and Energy each has a role in distributing money in the states for defense conversion purposes.

[The requesting individual] indicated that Congress would revisit the structure and funding for the defense conversion program in 1993; he would like to lobby for certain changes on behalf of [the law firm's] clients, some defense firms (some based in New York State, others not) which seek federal funding to diversify. Some funding would come from the Department of Defense, pursuant to the Act, but other funding would come from other federal agencies. [The requesting individual's] responsibilities would be to help firms apply for federal funding, evaluate their applications, and otherwise plan and help them access capital. Some of those responsibilities would relate to the Act, others would not.

Clearly, there is no two year bar as [the requesting individual] would not be appearing before his former State agency, or any State agency at all. He would be appearing before Congress and federal executive branch agencies to achieve his goals. The remaining question is whether the lifetime bar is meant to reach compensated services rendered by a former State employee before the federal government.

In previous opinions, the Commission has held that the lifetime bar applies to preclude services rendered on a lifetime barred case, proceeding, application or transaction before State agencies [Advisory Opinions Nos. 89-8; 90-4; 90-7; 90-11; 90-12; 90-18; 90-19; 90-21; 90-22; 91-2; 91-13; 91-18], before any court of competent jurisdiction [Advisory Opinion No. 89-7], before the State Legislature [Advisory Opinion No. 92-20; 93-2], or "anywhere" [Advisory Opinion No. 93-11].

The Commission concludes, consistent with its previous opinions, that the lifetime bar may appropriately be applied to services rendered before Congress and federal executive branch agencies. As with all lifetime bar applications, the determination must be made on a case-by-case basis.

[The requesting individual's] proposed work related to defense conversion may be separated into two types: efforts to assist particular defense firms receive available federal funding and efforts to change the legislative structure and formula by which such funding is allocated.

With respect to the former, the lifetime bar does not preclude [the requesting individual] from assisting firms which wish to obtain funding under the Act because the same transaction is not involved. The seeking of grant money under the law is a different transaction from the lobbying of the law.

Whether [the requesting individual's] efforts to change the Act's structure and formula by which funding is allocated would violate the lifetime bar also depends on a determination of whether the transaction is the same or a continuum, and whether it was one in which [he] was directly concerned and in which he personally participated or which was under his active consideration while in State service.

The Commission concludes that the transaction is the same. [The requesting individual] wishes to influence and alter the structure and formula of the very Act on which he lobbied. As the Commission noted in Advisory Opinion No. 92-20,

. . . bills introduced in the same or different legislative sessions may constitute the same transaction, particularly when they affect the same or substantially the same population. Further, work on substantially the same issue may also be the same transaction. This can be true even when the form in which the issue presented is not identical. (p. 24)

The Commission further illustrated that interpretation in Advisory Opinion No. 93-2, in which a lifetime barred transaction was found with respect to two pieces of legislation which had the "same subject and purpose, parties interested and affected, and the ultimate goal of the legislation remained constant." Those circumstances are found here.

Upon concluding that services on a lifetime barred case, application, proceeding or transaction before Congress and federal agencies may be precluded by the lifetime bar, and that the work on the defense conversion bill, and later, the Act, in two different settings would be the same transaction, the Commission must decide whether [the requesting individual's] role may be characterized as "direct concern and personal participation" or "active consideration."

[The requesting individual's] role [ ] with respect to Congress and federal branch executive agencies was similar to that of any lobbyist, that is, seeking federal government action on particular bills or programs. Unlike the Commission's previous application of the lifetime bar to prevent a former State employee from rendering services on a transaction before the State Legislature on which he had a role in his State position, here, the role of deciding the final form of the bill in question was not [his] or even anyone elses' in State government; it was the decision of the members of the U.S. Congress. [His] role was to advocate one result over another, but the decisions were others' to make.

With this result, the Commission advances the conclusions reached in Advisory Opinions No. 89-3, that "personal participation and direct concern in a specific case, proceeding, application or transaction requires more than an awareness of or informal conversation concerning the circumstances" [p. 8] and Advisory Opinion No. 90-16, "mere acquaintance with or knowledge of a fact or circumstance is insufficient to trigger the lifetime bar; presence at a meeting where an issue is discussed and the former employee did not vote on the issue, although others did, does not rise to the level of personal participation on the transaction." [pp. 12, 13].

In those opinions the Commission looked to the former employee's job responsibilities; in the first, the former employee could have had a role in reviewing or working on an application before a board with which he had job responsibilities. Since he did not exercise that role, the Commission found no direct concern or personal participation. In the second opinion, the former employee served ex-officio for a voting member of an agency. Since he did not vote on the transaction in question there, nor participate in the discussion on it, the Commission found no direct concern or personal participation. What underlies both those opinions and is decisive to a finding of whether the employee personally participated, was directly concerned or actively considered a transaction, is whether the former employee had some official State role in effecting the outcome of the transaction.(1)

The Commission finds that [the requesting individual's] role to advocate New York State's position on federal legislation before Congress or federal executive agencies was not one of an active participant or a decision maker. His input may have been considered by members of Congress or executive branch agencies, along with any positions of the other 49 states and, presumably, scores of the interested individuals and entities which sought to influence the outcome. The usefulness to a private client of [his] knowledge of bargaining position or data upon which strategies were developed, for example, is significantly diluted because the ultimate decision on the outcome of the work he sought to affect was in the federal, not State, arena.

While [the requesting individual] was certainly interested in the outcome of federal action on the defense conversion bill, the Commission concludes that that interest did not rise to the level of direct concern and personal participation or active consideration necessary to invoke the lifetime bar.

(6) Serving as an unpaid member of the Task Force on [ ] which is to make recommendations to the Governor.

The issue for the Commission to decide is whether service as a "volunteer" on a State board, commission or council by a former employee would violate the two year or lifetime bar of §73(8). The Commission concludes it does not.

In interpreting the former revolving door provisions which preceded the current post-employment restrictions, the Attorney General stated that the subdivision

. . . addresses the ethics problems that arise when a State employee leaves State service to work in the private sector . . . The statute also seeks to deal with the situation where a former State employee, soon after separation, deals with his former colleagues in their official capacities, and may receive special treatment or may create the impression in others that he enjoys the favor of his former colleagues. [Op. Atty. Gen. 84-F20]

The current revolving door prohibition contains a specific exception for post-employment services rendered for a government and allows former State officers or employees to appear practice, communicate or render services before any State agency or either house of the Legislature made while carrying out official duties as an elected official or employee of a federal, State or local government or one of its agencies.

Unpaid service performed at the request of the State and for the benefit of the State should not be construed as an appearance before a State agency.(2)

Here, the Task Force on [ ] will serve in an advisory capacity to the Governor, the head of the Executive Chamber, [the requesting individual's] former agency.

In Advisory Opinion No. 91-2, the Commission said that the lifetime bar should not be interpreted "in such a way as to hamstring State agencies from obtaining needed information" [p. 11]. There, the Commission found no lifetime bar violation where a State agency wanted to obtain information from a former State employee regarding the employees' acts while in State service. As long as the services were rendered for free, and the agency sought the information solely for its use and not for any other advantage, no lifetime bar violation occurred.

The Commission concludes that the post-employment restrictions of Public Officers Law §73(8) do not preclude a State agency from naming a former employee to serve, in a non-paid capacity, to a State agency, board, commission or council. Such a determination would be against the State's interest to lose the valuable services of former State officers and employees with talents and willingness to continue in some aspect of public service.(3)

This exception for volunteer service by former State officers and employees to allow service, in a non-paid capacity, extends only to those activities of the former State officer or employee in that capacity. Other appearing, practicing or receiving compensation on matters before the former agency (in two year bar cases) or with any State agency or elsewhere (in lifetime bar cases) otherwise precluded by §73(8) and the Commission's interpretations of it, are still not permissible.(4)

This opinion, until and unless amended or revoked, is binding on the Commission in any subsequent proceeding concerning the person who requested it and who acted in good faith, unless material facts were omitted or misstated by the person in the request for the opinion.

Concur:

Joseph M. Bress, Chair

Angelo A. Costanza
Robert E. Eggenschiller
Donald A. Odell, Members

Dated: May 10, 1993


Endnotes

1. See also, Advisory Opinion No. 91-12, where the former employee who worked on the design phase of [a particular project] could not, once in the private sector, participate in responding to a bid to provide design services on the same project; and Advisory Opinion No. 92-7, where the former chair/executive director of an agency who participated in labor contract negotiations while in State service could not, once in the private sector, represent the employee organization which wished to negotiate the contract signed while the former employee was chair.

2. The Commission notes the last sentence of Public Officers Law §73(8) states: "This subdivision shall not apply to any appearance, practice, communication or rendition of services before any state agency, or either house of the legislature, or to the receipt of compensation for any such services, rendered by a former state officer or employee or former member of the legislature or legislative employee, which is made while carrying out official duties as an elected official or employee of a federal, state or local government or one of its agencies."

3. The Commission notes that in previous opinions, it has held that unpaid appearing, practicing or rendering services on behalf of a private client before a former agency is barred by §73(8); see Advisory Opinion Nos. 89-7, 91-2.

4. This determination does not affect the conclusion that services rendered by a former State officer or employee on behalf of a private client, for free, which would otherwise violate the two year or lifetime bar of §73(8), are permissible. As the Attorney General noted in his Op. No. 84-F12 interpreting the meaning of the former post-employment restriction of §73(7), "[w]e note that the waiver of compensation does not necessarily mean that a former official has no self-interest in a private sector matter. There may be an implicit promise of compensation for future representation or the accrual of experience and good will that may be helpful in establishing a business.



URL: http://www.nysl.nysed.gov/edocs/ethics/93-13.htm