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2. Ethics PolicyCity p of Kalispell m - OFFICE OF THE CITY MANAGER TO: Mayor Fisher and Kalispell City Council FROM: Doug Russell, City Manager DATE: October 22, 2012 SUBJECT: Ethics Policy Discussion At a previous meeting a Council member had expressed interest in the discussion of an ethics policy for the City Council. Attached to this memo is the Code of Ethics that applies to elected officials and employees in the State of Montana. www.kalispell.com Section 4. Code of ethics. The legislature shall provide a code of ethics prohibiting conflict between public duty and private interest for members of the legislature and all state and local officers and employees. 2-2-101. Statement of purpose. The purpose of this part is to set forth a code of ethics prohibiting conflict between public duty and private interest as required by the constitution of Montana. This code recognizes distinctions between legislators, other officers and employees of state government, and officers and employees of local government and prescribes some standards of conduct common to all categories and some standards of conduct adapted to each category. The provisions of this part recognize that some actions are conflicts per se between public duty and private interest while other actions may or may not pose such conflicts depending upon the surrounding circumstances. 2-2-102. Definitions. As used in this part, the following definitions apply: (1) "Business" includes a corporation, partnership, sole proprietorship, trust or foundation, or any other individual or organization carrying on a business, whether or not operated for profit. (2) "Compensation" means any money or economic benefit conferred on or received by any person in return for services rendered or to be rendered by the person or another. (3) (a) "Gift of substantial value" means a gift with a value of $50 or more for an individual. (b) The tenn does not include: (1) a gift that is not used and that, within 30 days after receipt, is returned to the donor or delivered to a charitable organization or the state and that is not claimed as a charitable contribution for federal income tax purposes; (ii) food and beverages consurned on the occasion when participation in a charitable, civic, or cornrnunity event bears a relationship to the public officer's or public employee's office or employment or when the officer or employee is in attendance in an official capacity; (iii) educational material directly related to official governmental duties; (iv) an award publicly presented in recognition of public service; or (v) educational activity that: (A) does not place or appear to place the recipient under obligation; (B) clearly serves the public good; and (C) is not lavish or extravagant. (4) "Local government" means a county, a consolidated government, an incorporated city or town, a school district, or a special district. (5) "Official act" or "official action" means a vote, decision, recommendation, approval, disapproval, or other action, including inaction, that involves the use of discretionary authority. (6) "Private interest" means an interest held by an individual that is: (a) an ownership interest in a business; (b) a creditor interest in an insolvent business; (c) an employment or prospective employment for which negotiations have begun; (d) an ownership interest in real property; Prepared by the MSU Local Government Center. For Educational use only. For interpretation of the law, please seek competent legal counsel. (e) a loan or other debtor interest; or (f) a directorship or officership in a business. (7) "Public employee" means: (a) any temporary or permanent employee of the state; (b) any temporary or permanent employee of a local government; (c) a member of a quasi-judicial board or commission or of a board, commission, or committee with rulemaking authority; and (d) a person under contract to the state. (8) (a) "Public officer" includes any state officer- and any elected officer of a local government. (b) For the purposes of 67-11-104, the term also includes a commissioner of an airport authority. (9) "Special district" means a unit of local government, authorized by law to perform a single function or a limited number of functions. The term includes but is not limited to conservation districts, water districts, weed management districts, irrigation districts, fire districts, community college districts, hospital districts, sewer districts, and transportation districts. The term also includes any district or other entity formed by interlocal agreement. (10) (a) "State agency" includes: (i) the state; (ii) the legislature and its committees; (iii) all executive departments, boards, commissions, committees, bureaus, and offices; (iv) the university system; and (v) all independent commissions and other establishments of the state government. (b) The term does not include the judicial branch. (11) "State officer" includes all elected officers and directors of the executive branch of state government as defined in 2-15-102. 2-2-103. Public trust -- public duty. (1) The holding of public office or employment is a public trust, created by the confidence that the electorate reposes in the integrity of public officers, legislators, and public employees. A public officer, legislator, or public employee shall carry out the individual's duties for the benefit of the people of the state. (2) A public officer, legislator, or public employee whose conduct departs from the person's public duty is liable to the people of the state and is subject to the penalties provided in this part for abuse of the public's trust. (3) This part sets forth various rules of conduct, the transgression of any of which is a violation of public duty, and various ethical principles, the transgression of any of which must be avoided. (4) (a) The enforcement of this part for: (i) state officers, legislators, and state employees is provided for in 2-2-136; (ii) legislators, involving legislative acts, is provided for in 2-2-135 and for all other acts is provided for in 2- 2-136; (iii) local government officers and employees is provided for in 2-2-144. (b) Any money collected in the civil actions that is not reimbursement for the cost of the action must be deposited in the general fund of the unit of govermnent. 2-2-104. Rules of conduct for public officers, legislators, and public employees. (1) Proof of commission of any act enumerated in this section is proof that the actor has breached the actor's public duty. A public officer, legislator, or public employee may not: (a) disclose or use confidential information acquired in the course of official duties in order- to further substantially the individual's personal economic interests; or (b) accept a gift of substantial value or a substantial economic benefit tantamount to a gift: (i) that would tend improperly to influence a reasonable person in the person's position to depart from the faithful and impartial discharge of the person's public duties; or (ii) that the person knows or that a reasonable person in that position should know under the circumstances is Prepared by the MSU Local Government Center. For Educational use only. For interpretation of the law, Tease seek competent legal counsel. primarily for the purpose of rewarding the person for official action taken. (2) An economic benefit tantamount to a gift includes without limitation a loan at a rate of interest substantially lower than the commercial rate then currently prevalent for similar loans and compensation received for private services rendered at a rate substantially exceeding the fair market value of the services. Campaign contributions reported as required by statute are not gifts or economic benefits tantamount to gifts. (3) (a) Except as provided in subsection (3)(b), a public officer, legislator, or public employee may not receive salaries from two separate public employment positions that overlap for the hours being compensated, unless: (i) the public officer, legislator, or public employee reimburses the public entity from which the employee is absent for the salary paid for performing the function from which the officer, legislator, or employee is absent; or (ii) the public officer's, legislator's, or public employee's salary from one employer is reduced by the amount of salary received from the other public employer in order to avoid duplicate compensation for the overlapping hours. (b) Subsection (3)(a) does not prohibit: (i) a public officer, legislator, or public employee from receiving income from the use of accrued leave or compensatory time during the period of overlapping employment; or (ii) a public school teacher from receiving payment from a college or university for the supervision of student teachers who are enrolled in a teacher education program at the college or university if the supervision is performed concurrently with the school teacher's duties for a public school district. (c) In order to determine compliance with this subsection (3), a public officer, legislator, or public employee subject to this subsection (3) shall disclose the amounts received from the two separate public employment positions to the commissioner of political practices. 2-2-105. Ethical requirements for public officers and public employees. (1) The requirements in this section are intended as rules of conduct, and violations constitute a breach of the public trust and public duty of office or employment in state or local government. (2) Except as provided in subsection (4), a public officer or public employee may not acquire an interest in any business or undertaking that the officer or employee has reason to believe may be directly and substantially affected to its economic benefit by official action to be taken by the officer's or employee's agency. (3) A public officer or public employee may not, within 12 months following the voluntary termination of office or employment, obtain employment in which the officer or employee will take direct advantage, unavailable to others, of matters with which the officer or employee was directly involved during a term of office or during employment. These matters are rules, other than rules of general application, that the officer or employee actively helped to formulate and applications, claims, or contested cases in the consideration of which the officer or employee was an active participant. (4) When a public employee who is a member of a quasi-judicial board or commission or of a board, commission, or committee with rulemaking authority is required to take official action on a matter as to which the public employee has a conflict created by a personal or private interest that would directly give rise to an appearance of impropriety as to the public employee's influence, benefit, or detriment in regard to the matter, the public employee shall disclose the interest creating the conflict prior to participating in the official action. (5) A public officer or public employee may not perform an official act directly and substantially affecting a business or other undertaking to its economic detriment when the officer or employee has a substantial personal interest in a competing firm or undertaking. 2-2-106. Disclosure. (1) (a) Prior to December 15 of each even -numbered year, each state officer or holdover senator shall file with the commissioner of political practices a business disclosure statement on a form provided by the commissioner. An individual filing pursuant to subsection (1)(b) or (1)(c) is not required to file under this subsection (1)(a) during the same period. (b) Each candidate for a statewide or a state office elected from a district shall, within 5 days of the time that Prepared by the MSU Local Government Center. For Educational use only. For interpretation of the law, please seek competent legal counsel. the candidate files for office, file a business disclosure statement with the commissioner of political practices on a form provided by the commissioner. (c) An individual appointed to office who would be required to file under subsection (1)(a) or (1)(b) is required to file the business disclosure statement at the earlier of the time of submission of the person's name for confirmation or the assumption of the office. (2) The statement must provide the following information: (a) the name, address, and type of business of the individual; (b) each present or past employing entity from which benefits, including retirement benefits, are currently received by the individual; (c) each business, firm, corporation, partnership, and other business or professional entity or trust in which the individual holds an interest; (d) each entity not listed under subsections (2)(a) through (2)(c) in which the individual is an officer or director, regardless of whether or not the entity is organized for profit; and (e) all real property, other than a personal residence, in which the individual holds an interest. Real property may be described by general description. (3) An individual may not assume or continue to exercise the powers and duties of the office to which that individual has been elected or appointed until the statement has been filed as provided in subsection (1). (4) The commissioner of political practices shall make the business disclosure statements available to any individual upon request. 2-2-121. Rules of conduct for public officers and public employees. (1) Proof of commission of any act enumerated in subsection (2) is proof that the actor has breached a public duty. (2) A public officer- or a public employee may not: (a) subject to subsection (7), use public time, facilities, equipment, supplies, personnel, or funds for the officer's or employee's private business purposes; (b) engage in a substantial financial transaction for the officer's or employee's private business purposes with a person whom the officer or employee inspects or supervises in the course of official duties; (c) assist any person for a fee or other compensation in obtaining a contract, claim, license, or other economic benefit from the officer's or employee's agency; (d) assist any person for a contingent fee in obtaining a contract, claim, license, or other economic benefit from any agency; (e) perform an official act directly and substantially affecting to its economic benefit a business or other undertaking in which the officer or employee either has a substantial financial interest or is engaged as counsel, consultant, representative, or agent; or (f) solicit or accept employment, or engage in negotiations or meetings to consider employment, with a person whom the officer or employee regulates in the course of official duties without first giving written notification to the officer's or employee's supervisor and department director. (3) (a) Except as provided in subsection (3)(b), a public officer or public employee may not use public time, facilities, equipment, supplies, personnel, or funds to solicit support for or opposition to any political committee, the nomination or election of any person to public office, or the passage of a ballot issue unless the use is: (i) authorized by law; or (ii) properly incidental to another activity required or authorized by law, such as the function of an elected public officer, the officer's staff, or the legislative staff in the normal course of duties. (b) As used in this subsection (3), "properly incidental to another activity required or authorized by law" does not include any activities related to solicitation of support for or opposition to the nomination or election of a person to public office or political committees organized to support or oppose a candidate or candidates for public office. With respect to ballot issues, properly incidental activities are restricted to: (i) the activities of a public officer, the public officer's staff, or legislative staff related to determining the impact of passage or failure of a ballot issue on state or local govermnent operations; Prepared by the MSU Local Government Center. For Educational use only. For interpretation of the law, please seek competent legal counsel. (ii) in the case of a school district, as defined in Title 20, chapter 6, compliance with the requirements of law governing public meetings of the local board of trustees, including the resulting dissemination of information by a board of trustees or a school superintendent or a designated employee in a district with no superintendent in support of or opposition to a bond issue or levy submitted to the electors. Public funds may not be expended for any form of commercial advertising in support of or opposition to a bond issue or levy submitted to the electors. (c) This subsection (3) is not intended to restrict the right of a public officer or public employee to express personal political views. (4) A candidate, as defined in 13-1-101(6)(a), may not use or permit the use of state funds for any advertisement or public service announcement in a newspaper, on radio, or on television that contains the candidate's name, picture, or voice except in the case of a state or national emergency and then only if the announcement is reasonably necessary to the candidate's official functions. (b) A state officer may not use or pen -nit the use of public time, facilities, equipment, supplies, personnel, or funds to produce, print, or broadcast any advertisement or public service announcement in a newspaper, on radio, or on television that contains the state officer's name, picture, or voice except in the case of a state or national emergency if the announcement is reasonably necessary to the state officer's official functions or in the case of an announcement directly related to a program or activity under the jurisdiction of the office or position to which the state officer was elected or appointed. (5) A public officer or public employee may not participate in a proceeding when an organization, other than an organization or association of local government officials, of which the public officer or public employee is an officer or director is: (a) involved in a proceeding before the employing agency that is within the scope of the public officer's or public employee's job duties; or (b) attempting to influence a local, state, or federal proceeding in which the public officer or public employee represents the state or local government. (6) A public officer or public employee may not engage in any activity, including lobbying, as defined in 5- 7-102, on behalf of an organization, other than an organization or association of local government officials, of which the public officer or public employee is a member while performing the public officer's or public employee's job duties. The provisions of this subsection do not prohibit a public officer or public employee from performing charitable fundraising activities if approved by the public officer's or public employee's supervisor or authorized by law. (7) A listing by a public officer or a public employee in the electronic directory provided for in 30-17-101 of any product created outside of work in a public agency is not in violation of subsection (2)(a) of this section. The public officer -or public employee may not make arrangements for the listing in the electronic directory during work hours. (8) A department head or a member of a quasi-judicial or rulemaking board may perform an official act notwithstanding the provisions of subsection (2)(e) if participation is necessary to the administration of a statute and if the person complies with the disclosure procedures under 2-2-131. (9) Subsection (2)(d) does not apply to a member of a board, commission, council, or committee unless the member- is also a full-time public employee. (10) Subsections (2)(b) and (2)(e) do not prevent a member of the governing body of a local government from performing an official act when the member's participation is necessary to obtain a quorum or to otherwise enable the body to act. The member shall disclose the interest creating the appearance of impropriety prior to performing the official act. 2-2-131. Disclosure. A public officer or public employee shall, prior to acting in a manner that may impinge on public duty, including the award of a permit, contract, or license, disclose the nature of the private interest that creates the conflict. The public officer or public employee shall make the disclosure in writing to the commissioner of political practices, listing the amount of private interest, if any, the purpose and duration of the person's services rendered, if any, and the compensation received for the services or other information that is necessary to describe the interest. If the public officer or public employee then performs the official act Prepared by the NfSU Local Government Center. For Educational use only. For interpretation of the law, please seek competent legal counsel. involved, the officer or employee shall state for the record the fact and summary nature of the interest disclosed at the time of performing the act. 2-2-144. Enforcement for local government. (1) Except as provided in subsections (5) and (6), a person alleging a violation of this part by a local government officer or local government employee shall notify the county attorney of the county where the local government is located. The county attorney shall request from the complainant or the person who is the subject of the complaint any information necessary to make a determination concerning the validity of the complaint. (2) If the county attorney determines that the complaint is justified, the county attorney may bring an action in district court seeking a civil fine of not less than $50 or more than $1,000. If the county attorney determines that the complaint alleges a criminal violation, the county attorney shall bring criminal charges against the officer or employee. (3) If the county attorney declines to bring an action under this section, the person alleging a violation of this part may file a civil action in district court seeking a civil fine of not less than $50 or more than $1,000. In an action filed under this subsection, the court may assess the costs and attorney fees against the person bringing the charges if the court determines that a violation did not occur or against the officer or employee if the court determines that a violation did occur. The court may impose sanctions if the court determines that the action was frivolous or intended for harassment. (4) The employing entity of a local government employee may take disciplinary action against an employee for a violation of this part. (5) (a) A local government may establish a three -member panel to review complaints alleging violations of this part by officers or employees of the local government. The local government shall establish procedures and rules for the panel. The members of the panel may not be officers or employees of the local government. The panel shall review complaints and may refer to the county attorney complaints that appear to be substantiated. If the complaint is against the county attorney, the panel shall refer the matter to the commissioner of political practices and the complaint must then be processed by the commissioner pursuant to 2-2-136. (b) In a local government that establishes a panel under this subsection (5), a complaint must be referred to the panel prior to making a complaint to the county attorney. (6) If a local government review panel has not been established pursuant to subsection (5), a person alleging a violation of this part by a county attorney shall file the complaint with the commissioner of political practices pursuant to 2-2-136. The Commissioner has jurisdiction over laws and rules pertaining to: Ethics (Title 2, chapter 2, part 1), Lobbying (Title 5, chapter 7) and Campaign finance and practices (Title 13, chapters 35 and 37 ). Our Mission We fairly and impartially carry out our assigned responsibilities monitoring and enforcing campaign finance and practices and government ethics standards. We serve the public and interested parties in a helpful and responsive way. Commissioner of Political Practices 1205 8th Ave P.O. Box 202401 Helena, MT 59620-2401 (Tel.) 406-444-2942 htt-p://politicalpractices.mt.gov/ Prepared by the MSU Local Government Center. For Educational use only. For interpretation of the law, please seek competent legal counsel.