Section 9:
Conflicts of Interest, Appearance of Fairness Doctrine, and Liability of Elected Officials

9.1 Conflicts of Interest

The conflict of interest law is one of the State’s most complicated laws on the books. To understand its effect on a Councilmember’s actions, it is suggested that members discuss the law and potential conflicts with a private attorney or the City Attorney. It is imperative that Councilmembers identify potential conflicts in advance.

Municipal officers are required to declare a conflict of interest and are prohibited from participating or otherwise being involved in discussions on issues or contracts where such an interest exists. Violations of the conflict of interest law may result in voiding the contract involving civil or criminal penalties, and could result in forfeiture of office.

In circumstances where only a “remote interest” (see below) exists, after disclosure of the interest to other Councilmembers and in the meeting minutes, the Council may approve the contract to which a Councilmember has a remote interest, absent participation in the voting by the Councilmember with the remote interest, but only if the Councilmember refrains from any attempt to influence other members to approve the contract.

9.1.a Applicability

All City officers, elected and appointed, are subject to the conflict of interest law in 42.23 RCW. This includes Councilmembers.

9.1.b Definition

Remote Interests are those deemed so minor that they do not constitute illegal conflicts of interest. Remote interests exist when a City official is:

•    A non-salaried officer or member of a nonprofit corporation doing business or requesting money from the City. Therefore, being such an officer or member would not constitute a conflict.

•    The landlord or tenant of a contracting party. For instance, a Councilmember may lease office space to a party which has a private interest in a public matter without it resulting in a conflict of interest.

•    The owner of less than 1 percent of the shares of a corporation or a cooperative doing business with the City.

•    An employee or agent of a contracting party where the compensation of such employee or agent consists entirely of fixed wages or salary.

9.1.c Acts not Constituting a Conflict of Interest

•    Receiving municipal services on the same terms and conditions as if not a City official. Thus, when a Councilmember who owns a business within the City votes for or against an increase in the business license fees, a conflict would not exist because this action would apply to all businesses in the corporate limits.

•    An officer or employee of another political subdivision or public agency unless it is the same governmental entity being served who is voting on a contract or decision which would not confer a direct economic benefit or detriment upon the officer. Therefore, a Councilmember who is a school teacher may vote to enter into an intergovernmental agreement with the school district, unless such agreement would confer some direct economic benefit, such as a salary increase, upon the Councilmember.

•    A member of a trade, business, occupation, profession, or class of persons and has no greater interest than the other members of that trade, business, occupation, or class of persons. A class must consist of at least ten members to qualify the interest as remote.

9.1.d Declaration of a Conflict

When a substantial interest exists, the City official must:

1. Refrain from voting or in any way influencing a decision of the City Council; and

2. Declare that a conflict of interest exists and make it known in the official records of the City.

Should a situation arise wherein a majority of Councilmembers or a majority of a quorum of those present at a Council meeting have a substantial conflict of interest, state law provides that if the conflict of interest statutes prevent the City Council from acting as required by law in its official capacity, such action shall be allowed if the members of the Council with the apparent conflicts of interest make them known.

9.1.e City Attorney Opinions

A Councilmember’s request for an opinion from the City Attorney concerning conflict of interest is confidential. Councilmembers may seek advice from a private attorney, at their own expense, concerning potential conflicts. In such cases, no disclosure policy would apply.

9.1.f Prohibited Acts (RCW 42.23.070)

•    No municipal officer may use his or her position to secure special privileges or exemptions for himself, herself, or others.

•    No municipal officer may, directly or indirectly, give or receive or agree to receive any compensation, gift, reward, or gratuity from a source except the employing municipality, for a matter connected with or related to the officer’s services as such an officer unless otherwise provided for by law.

•    No municipal officer may accept employment or engage in business or professional activity that the officer might reasonably expect would require or induce him or her by reason of his or her official position to disclose confidential information acquired by reason of his or her official position.

•    No municipal officer may disclose confidential information gained by reason of the officer’s position, nor may the officer otherwise use such information for his or her personal gain or benefit.

9.2 Liability

The City must always approach its responsibilities in a manner that reduces risk to all involved. Nevertheless, with such a wide variety of high profile services (i.e., police, parks, roads, land use), risk cannot be eliminated. To better manage insurance and risk, the City participates in risk- and loss-control activities.

For risk management purposes, never admit liability unless authorized to do so by the City Attorney. It is best to not comment on such issues, and let the proper investigative authorities determine liability. Councilmembers should consult the City Attorney on liability issues.

It is important to note that violations of certain laws and regulations by individual members of the City Council may result in the member being personally liable for damages which would not be covered by the City’s insurance. Examples may include discrimination, harassment, or fraud.

Chapters 2.70 and 2.72 of the Olympia Municipal Code address defense of employees and officers.

Elected and appointed officials will participate in risk management training to reduce liability due to actions taken, especially in the areas of land use.