An opinion has been requested as to whether there is a violation of the Public Ethics Law (Article 40A, Annotated Code of Maryland, the Ethics Law) resulting from an exchange of property between the Department of Natural Resources (DNR or the Department) and an employee of the Department.
This request was presented by the Department of General Services (DGS) and involves a proposed real property transaction that has been in process for over ten years. The employee involved is the DNR Manager of Dan's Mountain State Park in Allegany County (the Park). The first property (the Employee Property) is a 3.9 acre plot owned by the Employee and his wife and adjoining the Park. It is a triangular lot, one corner of which is intersected by an Allegany County single lane dirt road. In addition to the Park, it is bordered by approximately two-hundred acres held by another private property holder. Together with this private holding, the Employee Property represents the only strip of property separating the Park from another property owned by the State and managed by DNR as a Wildlife Management Area. The second piece of property involved in the exchange (the State Property) is at the edge of the Park and consists of 2.6 acres currently held by the State. In addition to frontage of the unpaved County road, it is bounded by a paved State road.
The Employee purchased his property in 1969. He indicates that, as Park Manager, he is required to live in the Park. Dissatisfied with the dwelling provided to him by the State, he says he purchased this property with the intention of building a personal residence, and based on the understanding that the State did not intend to acquire this or other private property in the area. He indicates that he actually began some preparation of the land for construction. Subsequently, however, he was requested to hold off on any construction, as the Department had determined that it was interested in acquiring this and the other property between the Park and the Wildlife Management Area. The Employee indicates that he did refrain from construction of the residence, but states that his sole interest in this transaction has been and continues to be to acquire a piece of property on which to construct a personal residence, the location of which will satisfy the Department's Park Manager residence requirement.
Dan's Mountain State Park is a four-hundred acre Class A Park, one of the smallest in the State park system. It is a "day use area" park, having two shelters, a fishing pond and hiking trail, a playground, and a pool. The Park Manager's duties include preparation of the budget ($100,000); hiring, firing and supervising of personnel; and management of the pool. The Park staff consists of the Manager, one full-time ranger, and fourteen seasonal employees. The Employee states that there is no other private property in the Park, and that he has no official responsibilities regarding either his own property or that of the single other private landholder in the area. The road that intersects this property is a county road, and, except for occasionally cutting brush, the Park does not exercise any maintenance or other responsibilities over this road.
In furtherance of its interest in acquiring the Employee Property, the State has acted in two to three year periods since the property was originally offered for sale in 1973. Private appraisals and required relocation evaluations were done in 1973-74 and a recommendation was made in December 1974 to make a $4,800 offer for the property. The offer was not actually made until July 1976, however, when it was accepted, and a local private attorney was employed to do a title search. The title search disclosed an issue regarding mineral rights, and additional research was done on this matter, culminating in a report from the attorney in December 1978. The transaction was again held up until May of 1981, when the Director of DNR's Open Space Program presented a proposal from the Employee for a land exchange rather than an outright purchase. The appraisals of the Employee's property were updated, the State Property was appraised by a DGS appraiser, the required State excess property review was conducted, and the transaction was presented to and approved by the Board of Public Works (BPW) on June 9, 1982.
Personnel in DGS and DNR are in agreement that this transaction has been initiated and is being pursued by and for the benefit of the State. As was noted in the BPW review, the Department's ultimate goal is to acquire both the Employee Property and the other private property and make the Park contiguous with the Wildlife Management Area. This is a 9,000 acre area that is currently not accessible from the Park side of the Mountain, except through the privately held property. The Employee Property has been appraised at $6,500 and $8,200 and the State Property (which is smaller but more accessible) has been appraised at $6,500. General Services personnel see this as a relatively even exchange, and as a not unusual way in which the State acquires property that it wants. They do not believe that this transaction has been in any way special or unusual because it involves a State employee.
The question here is whether conclusion of this property exchange would result in any violation of the Ethics Law because one of the parties is an employee of the agency involved. A first question is whether the outside employment and interest prohibitions of §3-103(a)(1) of the Law raise an absolute bar to the Employee's involvement in this transaction. As this section, in part, forbids employees from having employment or interest relationships with entities that contract with or are under the authority of their agency, the first question is whether there is an entity here with which the Employee would be said to have such a relationship. We have on several occasions held that an interest in real property held for a personal residence is not an interest in an entity for purposes of §3-103(a)(1)(i) (see Opinions No. 83-32, No. 83-27, and No. 82-27,1 and we do not believe that the circumstances here require a different conclusion.
In particular, we note that the Employee is acting in view of a special park residence requirement imposed on him by his agency, and his insistence that through this entire process his goal has been to acquire property for a residence of his own that would meet this requirement. We note also his statement, supported by other Departmental personnel, that he purchased his property only on the understanding that the Department had concluded that it would not acquire the private property in the area. Also, this transaction began, and preliminary Departmental determinations were made by the Department, prior to enactment of this Law or establishment of this Commission. Furthermore, the Department's Forest and Parks Administrator has indicated that the Employee, as a manager of a very small park, does not function as a Park Manager in the policy development sense or in connection with agency decisions as to property purchases. He states that the Employee has not been involved, as an employee, in this process. Nor, apparently, do his duties involve dealing with property owners or otherwise impact on this transaction.
Moreover, personnel from both DNR and DGS emphatically insist that this exchange has been processed through all of the proper channels for State real property transactions. Natural Resources officials state that purchase of the Employee's property is in the interest of the Department and point out that this is an unusual situation--if the Department wants particular property, it has no choice but to buy it from the person who owns it. Under all of these circumstances, it is our conclusion that this transaction does not, as presented to us, present a conflict of interest as contemplated in Title 3 of the Ethics Law. These circumstances do not involve the ownership of an interest in or employment with an entity within the scope of §3-103(a). Nor do the Employee's duties or actual actions with regard to this transaction seem to us to raise issues under §3-101 (non-participation), 3-104 (use of prestige), or 3-107 (misuse of information).
We therefore advise the Employee, and DGS and DNR, that conclusion of this transaction would not result in a violation of the Public Ethics Law. We wish to make clear, of course, that our conclusion is based on representations made to us as to the history of the transaction, and as to the program determinations of the Department of Natural Resources. We do not in any way presume to rule on or evaluate the programmatic value or efficiency of this particular land exchange.
Reverend John Wesley Holland
Betty B. Nelson
Barbara M. Steckel
Thomas D. Washburne
1 Except as otherwise expressly cited to the Maryland Register, Opinion citations are to Commission Opinions published in COMAR Title 19A.