Conflicts of Interest

Guiding Principles

Decisions by city officials, employees, and agences should be based solely on what best serves the public’s interest
The ethics law is aimed at the perception, as well as the reality, that a public official’s personal interests may influence a decision
Having a conflict of interest does not mean that an official has done something wrong; it means that the individual has a financial or personal interest that disqualifies him or her from participating in a matter

What is a Conflict of Interest
Officials or employees have a conflict of interest when they, their employer, or their immediate family have a financial or personal interest in a contract, proposed legislation, or a decision that is pending before them or their agency.

Financial interest means any interest that yields a direct or indirect monetary or other material benefit to the official or employee, an employer, or an immediate family member
Personal interest means "any interest arising from relationships with immediate family or from business, partnership or corporate associations, whether or not any financial interest is involved"

How to Address Conflicts

Pending legislation. City council members who have a financial or personal interest in pending legislation should decline to participate in the discussion or vote on the matter and then file a conflicts disclosure form
Pending matter. Employees or board members who have a financial or personal interest in a matter pending before them or their agency should immediately remove themselves from the decision-making process, and, when required, file a conflicts disclosure form

Procedure for Disclosure

Prior to any decision, verbally disclose the conflict at the meeting, if any, at which the decision will be made
Have the disclosure placed in the minutes of the meeting or the agency's official records
Complete an online Conflicts of Interest Disclosure form at the Electronic Filing System

When to File a Disclosure Form

Knows or should know. The code requires disclosure when the official or employee “knows or with reasonable investigation should know” that the employee has a financial or personal interest in proposed legislation or a decision pending before the employee or the employee’s agency.

Example: A board member serving on an authority board learns from the meeting agenda that a member of her law firm is representing a developer in a proposal before the board. She files a disclosure form as soon as she learns about her firm’s representation of the developer.

Financial or personal interest. A financial interest is “any interest which shall yield, directly or indirectly, a monetary or material benefit to the official or employee” and any employer or immediate family member of the official or employee. Personal interest is defined “as any interest arising from relationships with immediate family or from business, partnership, or corporate associations, whether or not any financial interest is involved.”

Example: A council member serves on the Board of Directors of a non-profit organization that receives funding from the City. The council member is disqualified from voting on a resolution to approve a grant to the non-profit group.

Example: A neighborhood planning unit chair is a real estate broker who has been retained as a sales agent by a property owner. The property owner appears at an NPU meeting to seek support for a rezoning. The NPU chair has a financial interest in the zoning matter based on her sales contract with the property owner.

Pending matter. There needs to be a matter pending before the City. An official or employee is not required to file a disclosure form under the Code of Ethics because he, an employer, or a family member’s employer has done business with the City in the past or is likely to seek city business in the future.

Example: A local law firm hires the sister of an attorney in the law department. The firm is not currently doing work for the city, but did work for the City in the past and may seek the city’s business in the future. The attorney is not required to file a conflicts disclosure statement based on a completed contract or the possibility of a future contract.

Filing deadline. The disclosure should be filed online as soon as the official or employee becomes aware of the conflict. It is recommended that the filing be made no later than seven days after the meeting or decision.

Who Files the Form
All officials and employees are prohibited from participating in a decision in which they have a financial or personal interest, but only officials and employees filing the financial disclosure statement are required to file a conflicts disclosure form. Section 2-813 (b) covers 23 categories of filers, including members of city boards and commissions.

How Departments Handle Conflicts
Most employees' conflicts are handled informally within the department, and the department removes the employee from the situation or transfers the matter to another employee.

Example: The planning department learns that a permit expediter has hired the adult daughter of the employee who gives final approval to permit applications. The department moves the employee to a new position where she will have no role in approving permits submitted by her daughter.

Example: The son of a human resources specialist applies for a position in the department. The specialist is removed from the decision-making process.

General Guidelines
These guidelines provide only general guidance about when a conflict of interest disqualifies an official or employee from voting on legislation or participating in a matter. City officials or employees should contact the Ethics Office for advice on how to handle specific conflicts of interest.