Ethics panel sympathetic to Cockayne's request, but doesn't take his side

In response to a complaint filed by freshman Republican city Councilor, the city’s Ethics Board has ruled that several officials won’t violate ethics rules if they participate in votes on whether to shift pension funds into a new health benefits account.
However, panel members “do have concerns about the appearance of any such vote,” said Jim Donovan, the chairman of the board, wrote in an email to Mayor Art Ward.
Cockayne had questioned whether Ward and city Councilors Frank Nicastro and Kevin McCauley would have an ethical problem if they voted on a proposal to move the money from one fund to the other because they are either receiving or likely to receive pension money.
Donovan wrote to Ward that the ethics code “does not prevent” the three from participating in the issue.
Cockayne said he still believes there is an ethics problem that should make the three abstain from the matter.
But, he said, the ethics panel “took the time to understand my issue”and discussed it seriously.
“That’s why the Ethics Board is there,” Cockayne said. “Now we move forward.”
“The rule is the rule and hopefully the people involved will vote in the best interests of the taxpayers,” Cockayne said.
He said he intends to keep looking out for taxpayers, even if it troubles some of his council colleagues. Cockayne added that he won’t hesitate to seek opinions from the ethics panel in the future if the situation calls for it.
The city needs to sock away about $77 million to pay health benefits for its workers when they retire, city Comptroller Glenn Klocko said.
The best way to get the money, he said, is to tap the overfunded pension trust fund.
The most obvious alternative is to hit up the taxpayers for more money every year, which finance officials view as a poor choice since there’s more than enough money in the pension fund to cover both obligations.
City unions are pushing for a negotiated policy change that would reward their members for going along with the fund shift.
It is unclear what’s going to happen next on the issue, but several city leaders have said they anticipate the question may reach the front burner soon.

Update on April 1:

Here's the text of the Ethics Board decision, courtesy of Donovan --

ADVISORY OPINION No. 2008-006 KC
Interpretation of Article V Section 2-126, 2-129 (c) & 2-132 Definitions

INTRODUCTION

The City of Bristol’s Ethics Board issues this advisory opinion in response to a request for an opinion submitted by a current Councilman with the City of Bristol. This is in concert with the spirit and intent of Section 2-130 of the City of Bristol Code of Ordinances. In the request a Councilman with the City of Bristol asked for an interpretation of whether a conflict of interest would exist regarding GASB45 and future votes related to Pensions and Post employment benefits (OPEB) presented to the City Council and Mayor.
Within the 3/3/2008 documented request the Councilman, Ken Cockayne of the City of Bristol asked for an interpretation of whether a conflict of interest could exist and questioned the participation when called upon to vote of Councilman Kevin McCauley, Councilman Frank Nicastro Sr and Mayor Art Ward (hereinafter “Respondents”) regarding the aforementioned topics. Before discussion of the issue two matters pertaining to the request need clarification.

1) Kevin Ward, the Mayor’s policeman son, is not relevant under the code
(Sec. 2-132) as he is not a member of the mayor’s “immediate family”.
2) GASB45, OPEB & GASB25

(a) GASB is the Government Accounting Standards Board, (b) 45 is the specific statement number assigned to an accounting and financial reporting provision requiring government employers to measure and report the liabilities associated with other than pension post employment benefits, (c) 25 is the specific statement number assigned to an accounting and financial reporting provision for Defined Benefit Pension Plans and (d) OPEB is Other Post Employment Benefits.
GASB45 and GASB25 establish standards for accounting and financial reporting with the goal in mind to more accurately reflect the financial effects of Defined Benefit Pension Plan(s) and OPEB transactions.

BACKGROUND

Under the code of Ethics Section 2-126. Responsibilities of Public Office
(a) It shall be the responsibility of officials to carry out their duties to the best of their abilities and with the highest moral and ethical standards, regardless of personal considerations. Their conduct should at all times be for the public good and within the bounds of the law, should be above reproach, and should avoid a conflict between public and private interests and responsibilities.

Section 2-129 Conflict of Interest;
(c) No official who has a financial or personal (beneficial) interest, either individually or as a member of a group that has a financial or person interest, direct or indirect, in any transaction or contract with they city, or decision or board, body or commission, or in the sale of real estate, material, supplies or services to the city, on which he may be called to act upon in his official capacity, shall vote upon or otherwise participate in the transaction or contract or decision and shall excuse himself from the proceedings in accordance with Section 55 of the Charter of the City of Bristol.

Section 2-132 Terms & Definitions;
A financial interest means any interest that is in substantial conflict with the proper discharge of the official’s duties or employment in the public interest and of the official’s responsibilities as prescribed by the laws of this state and city, if the official has reason to believe or expect that the official, the official’s spouse or dependent children or a business with which he is associated, as defined herein, will derive a direct monetary gain or suffer a direct monetary loss as the case may be by reason of the official’s official activity.
Any such official does not have an interest that is in substantial conflict with the proper discharge of the official’s duties in the public interest and of the official’s responsibilities as prescribed by the laws of this state and city if any benefit or detriment accrues to the official, the official’s spouse or dependent child, or business with which he, his spouse or such dependent child is associated as a member of a profession, occupation or group to no greater extent than to any other member of such profession, occupation or group. This section was taken intact from the State Code of Ethics
Immediate family means any spouse, children or dependent relatives who reside in the individual’s household.

QUESTION

If the transfer of money from a pension fund to a new post employment benefits health insurance fund for current and former city employees was presented to the City Council members and the Mayor for a vote, would an active vote by Kevin McCauley, Frank Nicastro, Sr. and Mayor Art Ward result in a conflict of interest?

ANALYSIS

After hearing comments and input from Councilman Ken Cockayne it was clear in his remarks that he believed there to be a genuine need to raise the awareness regarding this subject matter.
All three of the “Respondents” are either receiving their pension, beneficiaries of the fund, are contributing to their pension or have an immediate family member who is doing so. Clearly all three “Respondents” “have a financial interest” in the pension as stated in Section 2-129. In addition, as elected city officials, all three have a duty to the taxpayers and voters of the City of Bristol. Absent the highlighted language of Section 2-132 this situation would clearly present a conflict of interest for the “Respondents”. However, the following must be considered...
Kevin McCauley, Frank Nicastro, Sr. and Mayor Ward, thru his wife, are all members of a group or profession that will not be affected, to any greater extent, than they themselves will be, by voting on this issue. That group consists of City Employees who are beneficiaries of the City pension. Upon the advice of the State Ethics Commission, this is how the State would interpret this question. As the highlighted language of Section 2-132 was taken right from the State’s code, we reasonably concluded that the writers of the Bristol Code intended it to be interpreted the same way.

CONCLUSION

It is the opinion of the City of Bristol’s Ethics Board that the absence of a financial benefit would not preclude the aforementioned officials from voting on the topic of GASB45 or GASB25. A policy decision on “how to “ fund a Defined Benefit Pension Plan(s) or Other Post Employment Benefits would not change the actual benefit received by the aforementioned individuals in the present or in the future to any greater or lesser extent than any other beneficiary of the pension..

Despite the Code allowing the “respondents” to vote on this matter, the Ethics Commission would strongly recommend that City officials remain cognizant of Section 2-126 “Responsibilities of public office”, prior to casting any vote so as to avoid a public perception of a conflict of interest.

Submitted by Helen G. Sneed and Jim Donovan on behalf of the City of Bristol Ethics’ Board

Attorney Jim Donovan, Chairperson

Dated 3/28/2008


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