85.11

OPINION NO. 85-11

An inquiry has been presented concerning whether a Department of Natural Resources (DNR or the Department) employee who does oyster bed lease surveys may be a surveyor subdividing leased oyster bottoms for an entity holding leases from DNR.

This request is presented by an employee who is a Natural Resources Manager in DNR's Tidewater Administration. Generally, the Tidewater Administration's responsibilities include such duties as placing navigational aids, removing debris from State waters, preserving public oyster bars, monitoring fish movements, and surveying the Chesapeake Bay, pursuant to Title 4 of the Natural Resources Article, Annotated Code of Maryland. The statutory provisions and the regulations promulgated by the Tidewater Administration (COMAR 08.02.04) set forth the requirements for the taking of oysters within the State and define the Department's authority and procedures for issuing commercial licenses and surveying, seeding and leasing oyster beds. Generally, any resident of the State may take up to one bushel of oysters for personal use and consumption on any day during the oyster season (September 15 to March 31) without a license. A commercial oysterman, however, must first be licensed by DNR.

The Department is responsible for maintaining natural oyster bars and seed oysters and for the leasing of private oyster grounds. Section 4-1108(a) of the Natural Resources Article provides that the Department leases, in the name of the State, submerged tracts of land to residents of the State for cultivating and other activities relating to oysters or other shell fish (the leased tracts are known as leased oyster bottoms). Leases are not available to corporations or joint stock companies. The law defines shape and size requirements for the leased area for county waters, the Chesapeake Bay and the Tangier Sound, and also establishes leasing procedures. A person seeking to lease submerged land submits an application identifying the area of submerged land for which the lease is sought. There is a public notice requirement which allows residents to protest the lease. After the period of protest or a final decision upon any protest, the Department is required to accurately survey the area, execute a lease, enter it on the "register of titles to oyster lands," and mail it to the applicant (see §4-1109(d)).

Section 4-1110 of the law provides that the term of the lease is for 20 years at an annual rent determined by DNR. The lessee is required to mark the leased oyster bottoms with buoys or monuments (§4-1113) and has exclusive ownership to all oysters planted by him. Section 4-1114(a) provides that the lease creates a landlord-tenant relationship between the State and the lessee, and defines several special conditions applying to the leases. Natural Resources law also bars the transfer of any interest acquired by a lease to a non-resident or corporation, as well as any transfer that would place the transferee's holdings above the maximum allowable holdings. There are also significant other provisions regulating the cultivation and taking of oysters in the State. It should also be noted that there is some competition and demand for oyster bottom rights, given the existence of a partial moratorium on new oyster leases in effect since 1975.

The Employee works in the Hydrographic Operations Section of the Tidewater Administration's Waterway Improvement Division. He is a classified employee, grade 16, employed in hydrographic (mapping) operations. His primary duties and responsibilities include both functioning as a marine survey specialist and as supervisor of the field operation survey vessels. His duties include determining accurate positions for the placement of buoys, beacons and boundary markers, conducting marine surveys for channel dredging projects, conducting private oyster lease ground surveys, and establishing shoreline control, observation stations, triangulations, and other traverse surveys as needed, throughout the Chesapeake Bay and its tributaries.

Both the Employee and his immediate supervisor describe Hydrographic Operations as a support unit providing nautical survey work for other units in DNR. The unit's work may include, for example, responding to requests by county governments for navigational aids in their waters, or restaking previously surveyed submerged lands. Hydrographic Operations also routinely checks the location of buoys and regulatory markers such as speed limits. In connection with those efforts, the Employee's duties include regular contacts with leaseholders and lease applicants regarding their lease surveys or resurveys, with the Tidal Fisheries Division regarding determination of size and location of seed oyster and oyster shell planting areas, and with DNR's Assistant Attorneys General as to boundary line decisions and laws relating to fisheries and private oyster ground. He also works with Natural Resources Marine Police determining locations of regulatory markers and preparing testimony as an expert witness in court trials for fisheries laws violations.

According to the Employee's supervisor, Hydrographic Operations has responsibilities specifically related to the oyster bed leases. The primary responsibility arises after the application has been received and the bottom sampled and approved by the Tidal Fisheries staff. At that point, Hydrographic Operations surveys the proposed location to provide an accurate description (metes and bounds) for the lease agreement. The Employee's supervisor signs the lease agreement as Chief Hydrographer, certifying the accuracy of the description of the leased property. The lease is executed on behalf of the State of the Director of the Fisheries Division of the Tidewater Administration. According to DNR procedures, the Director of Fisheries is responsible for approving and signing the original and renewed leases of oyster grounds. Also, the written DNR procedures for leased oyster grounds assign the Hydrographic Operations Section significant general duties, including responsibilities as to transfers of leased ground and resurveys of leased grounds.

This request arises out of the Employee's activities as a hydrographic surveyor with a private individual (the Lessee) who has hired him to plot the subdivision of his leased oyster ground. The Lessee has two oyster bed leases in his own name in Worcester County waters (for a total of 50 acres), and has access for oysters under two additional leases held by his son and another private individual. According to the Employee and his supervisor and Hydrographic Operations lease files, the Lessee obtained his initial two leases in 1978. One was an original application (43 acres) and the other (7 acres) was the result of an assignment. The other leased ground was acquired as a result of assignments from third parties in March and April of 1985. According to both the Employee and his supervisor, the Employee did not participate in the original survey of any of the Lessee's leased property because it occurred prior to the time he assumed his present position in 1979. He has, however, supervised and participated with the field staff in restaking the leased land each spring.

The Employee indicates that he was approached by the Lessee to subdivide the Lessee's oyster bottoms into one acre tracts. He states that he discussed the employment with his supervisor and it was agreed he could do it provided he did not participate in his State position in any matters regarding the Lessee's lease. Another individual who lives on the Eastern Shore was to be assigned the job to restake the leased property each spring and respond to other requests for service. The Employee apparently started work for the Lessee in the fall of 1984 on Saturday mornings. He states that he did not use State equipment or work on State time. He indicates that he completed one or two surveys (one acre plots) before Thanksgiving, and again worked for the Lessee in March and April 1985 after an illness in the late Fall. He indicates that he was paid per each area he surveyed.

The Department became aware of the employment because of the distribution of a prospectus by the Lessee which listed the Employee as his hydrographic surveyor. According to the Employee, he did not know that he was going to be listed in the prospectus. The Employee is not an investor or partner of the Lessee's business, but simply an employee. Apparently the Lessee approached the Employee to work for him because he had asked the Employee for the names of qualified hydrographic surveyors. The Employee said, according to the Lessee, that hydrographic surveyors are not licensed by the State and the only experts were State employees. Because the Lessee was concerned with possible disputes among his investors he has indicated that he wanted to have the State expert do the work.

Though allowed by the immediate supervisor, this activity has raised some concerns elsewhere in the Department, especially as to the appearance of conflict to the public. Despite the fact that the employee did not perform the original survey of the Lessee's oyster bottom, and another employee has been assigned to do this survey work, personnel at the Departmental level express concern that the employment would be questionable, given the granting authority of the Tidewater Administration. Some concerns have apparently also been raised about the Lessee's program of subdividing the leased oyster bottoms because in part it may frustrate the provisions of the Natural Resources Article (§4-1114(a)) that restrict assignment of leases.

This request raises outside employment issues under §3-103(a)(1)(i) of the Public Ethics Law (Article 40A, §3-103(a)(1)(i), Annotated Code of Maryland, the Ethics Law). This section prohibits an official or employee from being employed by an entity that is under the authority of or contracts with his agency, unless permitted by regulation of the Commission. In our view, the Employee's work for the Lessee is an employment relationship as contemplated by §3-103(a). Additionally, the Lessee's oystering activities, specifically his commercial license and his lease with DNR, are clearly subject to the authority of and result in a lease contract with DNR. We therefore believe that this relationship is one that is prohibited under §3-103(a)(1)(i) unless an exception is allowable pursuant to our outside employment exception regulations published at COMAR 19A.02.01.

These regulations implement language in §3-103(a)(1) that applies the prohibition, "except as permitted by regulation of the Commission...where such employment does not create a conflict of interest or the appearance of conflict...." The regulations are designed as guidelines for determining whether the relationships between private and official activities are so remote that these statutory criteria are met. They include review of official duties, agency responsibilities and organization, and compliance with other provisions of the Ethics Law, and a general evaluation of whether the total circumstances of the particular situation would present a conflict of interest or appearance thereof. We have considered the employee's affiliation with the Lessee, and his supervisor's willingness to assign another individual to duties involving the Lessee, and nevertheless conclude that the application of the regulatory review criteria does not support granting an exception in this situation.

The Employee's situation presents issues under several of the criteria. He has significant State duties related to the survey of oyster grounds, and in his position he has frequent contact with the leaseholders of oyster grounds. If there were a dispute as to lease boundaries or the area leased, he would be DNR's expert. The Employee, whose primary loyalty must be to DNR, could thus be placed in a position of conflict of interest by his outside employment resulting from the actions or non-actions proposed by his part-time employer that might be inconsistent with DNR requirements. The facts as presented indicate that he may have already been put in this position because the Lessee's proposed investment program has apparently presented concerns to the Department's Attorneys General. Also, the outside employer here is an entity which must comply with DNR regulations and the fisheries law. Much of the enforcement of the fisheries law relates to locations where oystering activities may take place, and the Employee's State duties make him the expert witness in surveys and location of oyster leases in enforcement matters or where there are boundary disputes between leaseholders.

Our regulatory exception criteria also require consideration of whether the individual has complied with other provisions of the Law. Under this criterion an issue could be raised under §3-104 of the Law, which prohibits an official or employee from intentionally using the prestige of his office for his own private gain or that of another. Though we do not specifically resolve an interpretation of this section as applied in this case, we believe that the fact that this relationship came about as a result of request for information from the Lessee raises potential problems under this provision, as does the express view by the Lessee that he preferred to have a "State expert" available in case of disputes with his investors.1 As we note, however, application of §3-104 need not be firmly resolved. We believe that this issue is simply an example of the kinds of concerns that can be presented and that are intended to be addressed by the provisions of the Ethics Law.

We understand that the Employee will not participate in specific matters relating to the Lessee's relationship with DNR. However, we believe that this situation is similar to the one we considered in our Opinions No. 84-18 and No. 83-1, where the employing agencies adopted a disqualification approach in response to §3-103(a) and our regulatory exception criteria. We expressed in those Opinions our view that §3-103 and the Ethics Law's §3-101 disqualification provisions must be viewed as "separate provisions expressing different concerns as to the conduct and activities of officials of the State." We noted there and conclude here, also, that disqualification cannot be viewed as an appropriate response to a §3-103(a) problem, nor should our exception regulations be read as adopting this approach. We believe that this conclusion is consistent with the purposes of the Law, as set forth in §1-102, to assure the public of the impartiality of public officials. The Employee holds a supervisory position in a DNR unit that has significant responsibilities in the oyster leasing process, and the public would be unlikely to know or understand to what extent reorganization of duties or nonparticipation would avoid a conflict of interest or appearance thereof.

Under all of the circumstances presented here, we do not believe that the relationship between the Employee's private employer and his agency program and duties can be characterized as remote, nor can we make the finding required under item I of the criteria that the specific employment circumstances do not otherwise create a conflict of interest or the appearance of conflict. We therefore advise the Employee that his affiliation with the Lessee would be inconsistent with §3-103(a)(1)(i) of the Law, and that the outside employment exception regulations may not be applied to overcome this bar.

Thomas D. Washburne, Chairman
    Herbert J. Belgrad
    Reverend John Wesley Holland
   Barbara M. Steckel

Date: August 5, 1985

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1 See our Opinion No. 81-44, which involved our application of §3-104 in a comparable situation.