Advisory Opinion No. 1997-22

Application of the Independent Contractor Section of the Code of Ethics,
Conn. Gen. Stat. §1-86e, to a Private Provider Contracting With
the Department of Mental Retardation

Barbara Langevin, a contract manager at the Department of Mental Retardation ("DMR"), has asked how the Code of Ethics for Public Officials, Conn. Gen. Stat. §1-79 et seq., applies to a private provider who contracts with DMR to provide services to several of the agency’s clients. Specifically, the provider in question, Wings of Windham ("Wings"), is a subchapter S corporation run exclusively by a husband and wife. Under contract with DMR, Wings provides support services to several individuals who are DMR clients. One of the clients lives in a house owned by the owners of Wings and pays rent to them. For a time, this same client shared a house with an immediate family member of the owners of Wings. The family member received a small salary and a reduction in the amount of rent which he was expected to pay in exchange for support services to the DMR client. Finally, at least one of the owners of Wings is a current state employee in a different state agency.

Examining this latter fact first, under Conn. Gen. Stat. §1-84(i), any contract worth $100 or more made between a state employee or a business with which he or she is associated and the State, other than a contract of employment as a state employee, must be made through an open and public process, including prior public offer of the contract and subsequent public disclosure of the contract awarded and the bids received. This means that the contract between Wings and DMR must have been awarded through such an open and public process in order to comply with the Code of Ethics, since at least one of Wing’s owners is a state employee. Also, of course, this individual’s state job must come first; "outside employment which threatens such priority impermissibly impairs a state employee’s independence of judgment." See State Ethics Commission Advisory Opinion No. 94-22, 56 Conn. L. J. 22, p.5D (11/29/94) ("State Employees May Not Accept Outside Employment as Probate Judge").

Secondly, as independent contractors, Wings and its owners are subject to the restrictions of Conn. Gen. Stat. §1-86e. In particular, §1-86e(1) states that no person hired by the state as a consultant or independent contractor shall "use the authority provided to the person under the contract, or any confidential information acquired in the performance of the contract, to obtain financial gain for the person, an employee of the person, or a member of the immediate family of any such person or employee." Two of the facts described above raise issues under this section—the rental of property owned by the Wings’ owners to the DMR client and the hiring and rent reduction of the immediate family member of the Wings’ owners who lived with this DMR client. If the decision to rent to the client and hire the family member were made without DMR knowledge or approval, these actions would appear to violate this section of the Code.

In order to avoid these possible conflicts of interest, the owners of Wings should, before raising these issues (or any other issues involving their financial interests or the financial interests of an immediate family member) with the DMR client, notify DMR in writing of the proposed actions and of the owners’ financial and familial connections with the matter. DMR should then approve or disapprove the actions, in writing, before they are presented to the DMR client as a possibility. Such a course of conduct is analogous to the procedure outlined in §1-86(a) for the avoidance of potential conflicts of interests by state employees and public officials.

By order of the Commission,

Maurice FitzMaurice
Chairperson