98.02

OPINION NO. 98-02

An opinion has been requested as to whether an exception can be allowed to permit the Chief of Archaeological Services in the Jefferson Patterson Park and Museum (a unit of the Maryland Historical Trust, which is in the Department of Housing and Community Development, DHCD) to serve on the Board of Directors of Preservation Maryland, a grantee of the Maryland Historical Trust. Based on the information provided regarding the interactions of this organization with the DHCD, we advise that this affiliation is barred by the employment prohibition of §15-502 of the Public Ethics Law (State Government Article, §15-502, Annotated Code of Maryland, the Ethics Law), and that an exception cannot be applied to allow it to continue.

The Maryland Historical Trust is the major program unit in the Office of Management and Planning in DHCD's Division of Historical and Cultural Programs. The MHT was established in 1961 to preserve, protect and enhance districts, sites, buildings, structures, and objects significant in the prehistory, history, upland and underwater archaeology, architecture, engineering, and culture of the State. The Trust acquires and maintains a partial interest in historic properties to monitor their condition and public appearance. It makes grants-in-aid and loans to help organizations, local governments, businesses and individuals acquire historic properties, and makes grants to local jurisdictions to survey Maryland historic sites. It also administers a volunteer network through its community education programs and maintains a library of archival and photographic material relating to Maryland archaeological and architectural history.

The Office of Museum Services is a unit of the MHT that is responsible for the State's Historical and Cultural Museum Assistance Program, providing for financial and technical assistance to local jurisdictions and private non-profit organizations. It also oversees and coordinates the Division's two museum properties: the Jefferson Patterson Historical Park and Museum (JPPM) and the Banneker-Douglass Museum of African-American History and Culture. The Jefferson Patterson Park and Museum is located in St. Leonard in Calvert County along 2.5 miles of shoreline on the Patuxent River and St. Leonard's Creek. It is located on a 546-acre farm given to the State in trust, and is the site of findings of prehistoric Indian sites and early European settlements. The mission of the Museum is to preserve, research and interpret the cultures of the Bay Area existing over a 9,000-year period through exhibits, educational programs and services. The JPPM includes the new $14 million Maryland Archaeological Conservation Lab, which will be responsible for the storage in conservation of the more than 7 million objects in the archaeology collection. It will perform registration and recordation functions as to objects, and is a state-of-the-art facility for artifact restoration and conservation. The Lab will be able to carry out specialized conservation analysis and will do some contract work with other entities.

This request was originally presented by the Chief of Archaeological Services, who is the Director of the Lab (the Requestor), for advice regarding her continued service on the boards of several private organizations engaged in activities that may relate to MHT preservation and archaeological programs. Though the Requestor has since resigned from the board of one of the entities, she continues to serve on the Board and as Assistant Treasurer of Preservation Maryland, and on the Boards of two national archaeology organizations, the Society for Historical Archaeology and the Council for Northeast Historical Archaeology.1 Preservation Maryland is stated to be the State's oldest preservation organization. It was established in the early 20th century through a large endowment from Eli Lilly. The organization, relying largely on this fund source, makes grants and low interest loans to individuals, private non-profit groups, and local governments to do preservation work. The only property with which the organization seems to continue significant involvement is Historic Hampton, a federal facility with which Lilly had substantial interests.

Preservation Maryland has several types of interactions with the Requestor's Department. For example, apparently several years ago, in order to create an ability to respond in emergency situations outside of the annual MHT grant process, MHT and Preservation Maryland jointly established an emergency fund. Small grants (up to $5,000) are made through a relatively fast and easy grant process from a fund that is jointly managed by a committee including representatives appointed by the two entities. In addition to this collaboration, grants to Preservation Maryland are made through MHT's regular annual ranking process, and tend to relate to research, surveys and general preservation services programmatic activities. A recent $25,000 grant, for example, involved management of a research project regarding the economic impact of historic preservation in Maryland. Preservation Maryland also has a lobbyist who registers pursuant to Subtitle 7 of the Ethics Law as a Legislative Branch lobbyist and lists the matters of the organization's interest as including the Maryland Historical Trust Grant Fund.

The Requestor is a board member and Assistant Treasurer of Preservation Maryland. She says that the organization has several full-time staff persons, who handle the actual financial business of the organization, and she thinks that the title is largely honorary. She attends executive committee meetings and reads a staff prepared treasurer's report at the board meeting when the Treasurer is not present. She was involved as a lead investigator in a Preservation Maryland project to prepare a report regarding Hampton House and potential research projects related to it and is thus viewed as a board expert on Hampton. She says that she has not been involved in the organization's grant or other relationships with MHT. She has not participated in activities relating to joint administration of the emergency fund, and does not directly participate in the organization's State directed lobbying activities.

This request involves application of the employment provisions of §15-502 of the Ethics Law. This section bars an employee from being employed by an entity that contracts with or is subject to the authority of their agency (subsection (b)(1)), or from having any other employment that would impair their impartiality or independence of judgment (subsection (b)(2)). Our consistent advice in the past has been that service on the management and operational board of a private organization entails fiduciary and other duties that result in its being viewed as employment even if it is not compensated.2 The Requestor's affiliations with Preservation Maryland would thus be viewed as employment and would be prohibited if the entity has contractual or regulatory relationships with the Department of Housing and Community Development, or if the affiliation would otherwise result in impairment. Preservation Maryland does have grants from the MHT and also is involved in a grant funding relationship in connection with the emergency grant fund program. Its lobbying activities in connection with the agency's programs would also bring the affiliation within the impairment provisions of the Law. The Requestor's service on its Board and as an officer would therefore come within this prohibition and be barred unless an exception is allowed.

Exception can be granted if it is determined, pursuant to the Commission's exception regulations (at COMAR 19A.02.01), that the affiliation does not present a conflict of interest or appearance of conflict. The Commission's regulations consider the relationships between an individual's agency program and duties and the private activity, as well as the nature of the private activity, in order to determine whether the relationships are sufficiently remote that a conflict or appearance of conflict is unlikely. For example, in addition to consideration of how an individual's official agency duties relate to the private entity, we take into account the nature of the individual's functions and activities with the private entity, and whether these functions entail the agency or its programs or would involve interaction with an individual's own agency functions.

In applying these criteria to the Requestor's situation, we recognize that the Requestor has a defined and focused job function in connection with operation of the Lab located in St. Leonard, and that she may not play a substantial role in policy or program activities handled at the Trust's offices in Crownsville. We believe, however, that issues are presented from the nature of the private activity, particularly since the Requestor's affiliation with Preservation Maryland involves her with the managing Board that is responsible for program direction of the entity and ultimately accountable for its performance on Trust grants and other dealings. We have generally not accepted disqualification from participation in related matters as a cure of a conflict in these types of situations, since it is difficult to monitor and totally reliable only at a particular time and set of circumstances. Moreover, we think that the Law's mandate requires us to look to the total circumstances of a particular situation, and tend not to allow an exception where there are several issues that create questions. The view has been that since this is an exception to a clearly applicable prohibition in the Law, it should only be allowed where relationships between the official and private activities are genuinely remote. Also, the statutory criteria require a finding that there is no conflict or appearance of conflict.

In the situation here Preservation Maryland is a major private participant in activities that are at the heart of the Requestor's agency's program. In addition to a variety of grant and other collaborative relationships, it engages in lobbying activities that specifically list her agency and its program as a focus. The Requestor for her part is a member of the managing and policy making Board of the entity. She holds an office that places her on the entity's executive Board where she would be expected to participate in legislative and other policy functions and to provide supervision and direction to the entity's Executive Director, who is its registered lobbyist. In our view this results in appearance concerns given her role on the Executive Committee of the organization, even if she disqualifies herself from the entity's activities directly involving MHT grants or related actions. Under all of these circumstances, we are unable to conclude that the relationships here are sufficiently remote that a conflict or appearance of conflict is unlikely, and therefore advise the Requestor and her agency that an exception cannot be applied to allow her continued service on the Board of Preservation Maryland while she continues as DHCD employee.

Michael L. May, Chairman,
    Mark C. Medairy, Jr.,
    April E. Sepulveda

Date: June 30, 1998

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1 We are advised that these organizations do not directly operate in Maryland and that their activities are directed primarily at federal agencies and the federal Congress. The Requestor further indicates that legislative activities in which she participates for these organizations in no way involve agencies or programs that relate to her State agency. It would therefore appear that these affiliations do not present Ethics Law issues and we do not further consider them in this request.

2 See, for example, Opinions No. 95-9, 94-8, 91-15 and 89-16.