An opinion has been requested concerning whether certain employees classified as "Buyers III" in the Department of General Services (DGS) have been properly identified as having contract responsibilities that would make them public officials under the Public Ethics Law (Article 40A, Annotated Code of Maryland, the Ethics Law).
This request is basically an appeal from an Ethics Commission determination in 1981 that these Buyers in DGS's Purchasing Bureau must file a Financial Disclosure Statement because they draft specifications for, negotiate or execute contracts as set forth in the Ethics Law definition of "public official." 1 The request is submitted on behalf of several employees, all of whom are classified as Buyers III and are State Grade 15 (the Buyers). Their spokesman indicates that they all have the same job responsibilities insofar as they are relevant to the consideration of this request.
The Purchasing Bureau is responsible for the purchase of equipment and supplies used by State agencies. It accepts and processes requisitions from user agencies, following, predominantly, a formal competitive closed bid procedure. Its buyers are organized in teams having responsibility over certain commodity areas. The job specification for the Buyer III classification includes the responsibility for: 1) reviewing and analyzing requisitions, invoices and purchase orders; 2) establishing and writing product specifications and standards; 3) establishing and maintaining a list of suppliers within their commodity group; and 4) obtaining bids and awarding contracts to successful bidders. The Bureau has defined limitations setting the maximum amounts at which a person has final committing authority; the maximum amount that a Buyer III can commit without additional approval is $5,000. The Buyer, however, is the initial review and evaluation authority for all purchases, even though final approval authority may be vested at a higher level.
For purchases that cannot be finalized by the Buyer, an award approval form is completed by the Buyer. This form summarizes the bidding results and recommends an award. Justification of the recommended award is provided where necessary (for example, where someone other than the lowest bidder is recommended). A substantial percentage of all awards are to the lowest bidder. The entire bid file is transmitted to the approving authority, who may review the award in detail. Though this is occasionally done, apparently in a substantial number of situations the Buyer's recommendation is approved and a purchase order returned to him for further action. The Program Manager indicates that supervisory approving personnel rely to a considerable extent on the skill and judgment of the Buyers in evaluating bids and recommending awards. The Program Manager believes that the Buyers have sufficient authority to be public officials required to file financial disclosure.
Section 4-101 of the Ethics Law requires financial disclosure by officials, including public officials. Thus, the issue here is application of the provision of §1-201(aa)(4) (formerly 1-201(z) 1-201(z)(1)(ii) of the Ethics Law), which defines public official to include "any individual in an executive agency who...is charged...with decision making authority or acts as principle advisor to one with such authority in drafting specifications for, negotiating, or executing contracts which commit the State or any executive agency to expend in excess of $10,000 per annum." The definition in effect at the time of this request was substantially similar to this definition. In implementing the financial disclosure program as it was originally enacted, we in 1980 communicated with heads of departments and agencies, requesting them to identify employees in their agencies that met the statutory criteria for contracting personnel.
According to personnel in DGS's Personnel Administration, that Office reviewed job specifications, identifying those that could possibly be expected to have such authority. These position titles, with the names of incumbents, were transmitted to the appropriate Office Directors with the request that they review them and recommend whether the positions should be covered. The result of this procedure was that DGS provided the Ethics Commission with a list of DGS personnel who would or could be said to meet the Ethics Law criteria. In the Buyer III category, 10 individuals were identified as "possibly" covered, with the following notation: "He drafts specifications and negotiates contracts for over $10,000, however, both are reviewed and subsequently approved by higher level authority before adoption." The Commission included these individuals based on our interpretation that the Law covers individuals who have preliminary and preparatory input into a decision, even though they may not have final approval authority.
The Buyers question their inclusion in the financial disclosure program based on their described job responsibilities. They emphasize the fact that their final approval authority is limited to purchases at or below $5,000. In addition to their Grade 15 salary level, they point out that they do not have policy or managerial authority. They indicate that they do not have substantial specifications-drafting authority as these descriptions of required items are prepared and submitted by the user agency. The standard specifications drafted for use by the agencies are not drafted by buyers, but by technicians specifically skilled in this area. The Buyers state that the competitive bidding process is a very formal procedure under which they have little discretion and are expressly forbidden to negotiate with vendors.
The DGS Program Manager supervising these individuals indicates that their responsibility for processing requisitions submitted by user agencies includes reviewing the specifications to ensure that they are clear enough so that bidders can bid responsively, and also to ensure that they are not drafted so restrictively as to limit competition. The Buyer is authorized, regardless of the dollar value of the purchase, to work with a user agency to change specifications that are too narrowly drafted, or to change them himself when he knows that alternative or equivalent products are available. The extent to which this actually happens is not clear. After bids are received, they are opened at a designated time in a formal public bid opening. The bids are then sent to the Buyer for review and evaluation. This evaluation involves reviewing the bid to determine whether it is responsive to the specifications and whether some alternative is offered that may also be acceptable. Buyers have broad authority to contact either the user agency or the bidder for clarification purposes, but contract price quotes may not be negotiated or changed except within very narrow circumstances set forth in the standard price clause.
In our consideration of the Buyers' request for review of our determination, we concluded that persons in these positions were intended to be covered by the financial disclosure program, despite the fact that many of their decisions are subject to supervisory review. We believe that inclusion of specification-drafting and negotiating, as well as executing, contracts reflects a statutory recognition that many persons have substantial impact on the commitment of State funds through contracts even though they may not actually sign the document. In our view, the Buyers' ability to review and influence changes in user agencies' contract requests and bid review and evaluation activities constitute the types of activities intended to be covered by the Law's definition of public official. In reviewing the application of the Law to these employees, we have considered the agency's evaluation of its employees' duties and their roles, as well as their official job descriptions and explanation of what they actually do. Based on all of these considerations, we concluded that the Buyers are involved in drafting specifications for and negotiating contracts as set forth in the Law and are required to file financial disclosures, and we have so notified these employees.
The 1981 amendments to the Ethics Law established a procedure for identifying public officials that involves recommendations by the Secretary of Personnel. Agency and department heads were, however, again consulted regarding the application to their employees of the various statutory criteria set forth in the definition. As to contracting employees, these criteria continue to include responsibilities for drafting specifications and negotiating contracts. Based on consultation between DGS and the Department of Personnel these Buyers were again identified as public officials under the Ethics Law. We agree with this view and have included them in the financial disclosure distribution for 1982.
We continue to believe that these employees' activities in processing bid requests and reviewing and making recommendations for contracts constitute the types of support activities intended to be included in the public official definition. They are directly and significantly involved in a purchasing process that results in the commitment of substantial State funds and, in our view, are plainly intended to be included in the financial disclosure program. We therefore advise these individuals that they continue to be identified as public officials and are required to file financial disclosure statements in accordance with Title 4 of the Ethics Law.
Herbert J. Belgrad, Chairman
Jervis S. Finney
Reverend John Wesley Holland
Barbara M. Steckel
Date: July 21, 1982
1 At the time of the request, §1-201(z)(1)(ii). In Laws of 1981, Ch. 796, the Ethics Law was amended, with the current provision regarding coverage of persons having contract responsibilities (§1-201(aa)(4) reflecting no substantive changes in application of this provision.