May 1, 2000
Council of the District of Columbia
Washington, DC 20004
Re: Conflict of Interest
– Councilmember Jack Evans
Dear Ms. Brookins-Hudson:
to your request for an opinion, by letter dated April 27, 2000, concerning
whether Councilmember Jack Evans’ vote on Bill 13-333, the “Physicians
Negotiations Act of 2000” (Bill), presents a conflict of interest in view
of his employment with Central Benefits Mutual Insurance Company (Central)
of Columbus, Ohio. You state that the Bill allows for “joint negotiation
by competing physicians of certain terms and conditions of contracts with
health plans”; and that some in the insurance industry claim that the
passage of the Bill would “shift medical liability from providers to insurers,
which could lead to additional and significant cost increases”.
Further, you state that it is speculated that “a vote to defeat
this legislation could be construed as benefiting insurance companies,
including Central . . .”. You advise that Mr. Evans has been associated
with Central since January 1999.
DC Code §
1-1461(b) provides that “[n]o public official shall use his or her official
position or office to obtain financial gain for himself or herself . .
. other than that compensation provided by law for said public official.
This subsection shall not affect a vote by a public official: (1)
on any matter that affects a class of persons (such a class shall include
no less than 50 persons) of which such public official is a member if
the financial gain to be realized is de minimis . . .”.
18 U.S.C. §
208 further restricts District employees from participating personally
and substantially in government matters requiring decision-making and/or
advice when, to their knowledge, they have a direct or indirect financial
interest in the matter. (emphasis added). This federal statute
has had longstanding applicability to District officers and employees,
including members of the Council of the District of Columbia.
Pursuant to CFR § 2640.103, which implements 18 U.S.C. §
208, an employee’s participation is personal and substantial when he or
she directly takes part in the matter, and his or her involvement is “of
significance to the matter.” Moreover, an employee is prohibited
from participating in an official capacity in a matter in which he or
she has a financial interest “if the particular matter will have a direct
and predictable effect on the interest.” The test for a direct financial
interest is whether there is a “close causal link between any decision
or action to be taken in the matter and any expected effect of the matter
on the financial interest.” A predictable effect is found where
there is a real, rather than speculative, possibility that the matter
will affect the financial interest.
to matters that affect the employee’s own financial interests, the prohibition
of 18 U.S.C. § 208 applies to particular matters that affect the
financial interests of the employee’s spouse, minor child, general partner,
or an organization or entity in which the employee serves as officer,
director, trustee, or general partner.
Based on your
representations, it would appear that the financial interests of Central
Benefits Mutual Insurance Company, for whom Councilmember Evans serves
as a Vice President and local representative, could be affected by the
vote on Bill 13-333. Further, it is conceivable that the outcome
of this Bill may affect the financial interests of Mr. Evans by virtue
of his employment with Central. Therefore, it is the opinion of
this Office that Mr. Evans should recuse himself from voting on the referenced
legislation, and that he should follow the recusal procedures in
Code § 1-1461(g), as implemented by regulations at 3
3303, to avoid a conflict of interest.