An opinion has been requested from employees in the State Highway Administration (SHA) concerning whether employees who work in the Administration's Interstate Division for Baltimore City (the Interstate Division) must file financial disclosure under Title 4 of the Public Ethics Law (Article 40A, Title 4, Annotated Code of Maryland, the Ethics Law.)

This request is presented by the Chief of the Bureau of Management, Interstate Division, on behalf of the Division's employees. The Interstate Division is a State agency within the SHA (one of seven Administrations within the Department of Transportation). It acts on behalf of Baltimore City for the purpose of designing and constructing the 3A Interstate Highway System within Baltimore City. The Requestor states that the Interstate Division does not commit any State funds for the highway; contracts executed by the Interstate Division commit Baltimore City to pay the contract costs. Also, though the Interstate Division does incur expenses for various services it provides concerning the highway, Baltimore City reimburses the SHA for all expenses attributable to its activities.

Section 4-101 of the Ethics Law requires submission of financial disclosure reports by individuals who meet the Law's definition of State official or public official. At the time of our original consideration of this request, the term "public official" was defined in §1-201(r) of the Law to include:

Any individual...in the executive branch...who:
(i) Is classified or compensated at grade level 18 or above,...or
(ii) Is authorized to draft specifications for, negotiate or execute a contract which commits the State or any of its boards, agencies, or departments to expend in excess of $10,000 or is in a managerial or policymaking position as determined by the Ethics Commission by regulation upon recommendation of the Secretary of Personnel.

After our original review of this request, the Legislature amended the Ethics Law, substantially changing the definition of "public official" to include, in addition to the compensation and grade level criteria set forth above, standards relating to individuals' job duties and responsibilities. (See §1-201(aa) of the Law, as enacted in Laws of 1981, Ch. 796, eff. June 1, 1981.) The criteria relating to contractual activities set forth in (ii) above were included in the amended definition without significant alterations relevant to this request.

We have been advised that the Interstate Division acts on behalf of Baltimore City and commits only Baltimore City to the expenditure of funds. We do not believe, however, that this funding situation in any way affects the Division's status as an agency within the executive branch of State government. Nor do we believe it alters the status of Division personnel as employees of the State, rather than the City. Thus, we conclude that personnel serving in the Division are individuals in an executive agency and are therefore public officials required to file financial disclosure if they meet the salary and job duties criteria set forth in the current definition of public official. (Section 1-201(aa)(1) of the Law.) This definition (in subsection (aa)(1)(ii)) establishes a procedure involving recommendations from the Secretary of Personnel regarding application of the job duties criteria. We note that this procedure, which also involved recommendations from the employing agency, resulted in identification of three Interstate Division employees as public officials. All were notified of their inclusion and have in fact submitted financial disclosures for the appropriate reporting period.

As noted above, provisions regarding employees who have duties regarding State contracts were included in the amended definition of public official. (Section 1-201(aa)(4). This subsection would include as public officials those persons who, regardless of salary or compensation, are authorized to draft specifications for, negotiate, or execute contracts which commit the State or an executive agency to expend in excess of $10,000 per annum. We noted in our consideration of this request that the strict reading of this language would appear to exclude employees of the Interstate Division, since the Division does not commit the State or any executive agency thereof to the expenditure of State funds. We do not believe that any of the amendments to the definition require a different application of this provision. We therefore advise the Division and SHA that no persons in the Division need be identified as public officials having contract responsibilities, as long as the Division in its contracts commits only Baltimore City and not the State or an executive agency of the State.1

Herbert J. Belgrad, Chairman
    Jervis S. Finney
    Reverend John Wesley Holland
    Barbara M. Steckel

Date: July 21, 1982


1 We are aware of no persons who were identified as public officials, based on the contracting criteria, during the identification process for the most recent annual financial disclosure.