Advisory Opinion No. 2018-39 Rhode Island Ethics Commission Advisory Opinion No. 2018-39 Approved: June 19, 2018 Re: Maxine Cavanagh QUESTION PRESENTED: The Petitioner, a member of the Smithfield Town Council, a municipal elected position, requests an advisory opinion regarding whether she may participate in the Town Council’s discussions and decision-making relative to a potential amendment to a town ordinance that affords a tax freeze to Smithfield senior citizens, given that she and her spouse qualify for and receive the tax freeze. RESPONSE: It is the opinion of the Rhode Island Ethics Commission that the Petitioner, a member of the Smithfield Town Council, a municipal elected position, may participate in the Town Council’s discussions and decision-making relative to a potential amendment to a town ordinance that affords a tax freeze to Smithfield senior citizens, notwithstanding the fact that she and her spouse are eligible for and receive the tax freeze. This is based on application of the Code of Ethics’ class exception. The Petitioner is a member of the Smithfield Town Council (“Town Council”). She represents that the Town Council is conducting public workshops and considering a potential amendment to an ordinance that affords a tax freeze and tax exemption to Smithfield residents who qualify for it based on age and occupancy, also known as the Senior Tax Freeze. The Petitioner explains that she and her spouse have qualified for and received the Senior Tax Freeze since 2007. She states that the Town Council is considering various amendment options, including completely eliminating the Senior Tax Freeze, converting the exemption to a tax credit or keeping it as is. However, the Petitioner notes that she and her spouse would be impacted by any of the above amendments to the Senior Tax Freeze Ordinance to no greater or lesser extent than approximately 1,500 other Smithfield residents who are currently qualified for and receive the Senior Tax Freeze.[1] Based on these representations, the Petitioner asks whether the Code of Ethics permits her participation in the Town Council’s discussions and voting relative to a potential Senior Tax Freeze amendment. Under the Code of Ethics, the Petitioner may not participate in the Town Council’s discussions or voting relative to any matters in which she has an interest, financial or otherwise, which is in substantial conflict with the proper discharge of her duties. R.I. Gen. Laws § 36-14-5(a). A substantial conflict of interest occurs if the Petitioner has reason to believe or expect that she or a family member, employer or business associate will derive a direct monetary gain or suffer a direct monetary loss by reason of her official activity. Section 36-14-7(a). Furthermore, the Petitioner may not use her office for pecuniary gain, other than as provided by law, for herself, a family member, employer, business associate, or a business that she represents. Section 36-14-5(d). However, the above prohibitions contain a “class exception” which states that a public official will not have an interest in substantial conflict with her public duties if any benefit or detriment accrues to her or her family member, employer or business associate “as a member of a . . . group, or of any significant and definable class of persons within the . . . group, to no greater extent than any other similarly situated member of the . . . group, or the significant and definable class of persons within . . . group.” Section 36-14-7(b). When determining whether any particular circumstance justifies the application of the class exception, the Commission considers the totality of the circumstances including, where appropriate: 1) the description of the class; 2) the size of the class; 3) the function or official action being contemplated by the public official; and 4) the nature and degree of foreseeable impact upon the class and its individual members as a result of the official action. The Ethics Commission has issued numerous advisory opinions in the past concerning whether a person subject to the Code of Ethics may participate in decision-making relative to a municipal tax freeze ordinance that would provide her with a financial benefit. Nearly all of these opinions concerned the application of the Code of Ethics’ “class exception.” See A.O. 2005-22 (member of Exeter Town Council may vote on senior tax freeze ordinance for which he and his spouse would qualify, given that ordinance applies equally to some 250-300 residents); A.O. 2002-27 (Exeter Town Council member may participate in Town Council’s decision to enact a senior tax freeze ordinance that applies to 350 residential homeowners in the Town); A.O. 2002-10 and 2002-11 (East Greenwich Town Council members over age 65 may participate and vote on a proposed tax freeze ordinance that would affect 660 homeowners). In the instant matter, while the Petitioner and her spouse would be financially impacted by any of the above-described changes in the Senior Tax Freeze Ordinance, the Petitioner represents that they would be impacted to no greater or lesser extent than the approximately 1,500 other residents who are currently eligible for the Senior Tax Freeze. Under such circumstances, the Ethics Commission concludes that the class exception set forth in section 7(b) applies and the Petitioner may participate in discussions and voting relative to amending the ordinance in the ways described herein. In the event that that Town Council’s discussions veer into amending the ordinance in ways that impact the Petitioner or her spouse individually, or as members of a much smaller class or subclass of recipients of the Senior Tax Freeze, the Petitioner must either recuse from participation or seek additional guidance from the Ethics Commission. Upon such recusal, a statement of conflict of interest must be filed with the Town Council and the Ethics Commission pursuant to section 36-14-6. This Advisory Opinion is strictly limited to the facts stated herein and relates only to the application of the Rhode Island Code of Ethics. Under the Code of Ethics, advisory opinions are based on the representations made by, or on behalf of, a public official or employee and are not adversarial or investigative proceedings. Finally, this Commission offers no opinion on the effect that any other statute, regulation, ordinance, constitutional provision, charter provision, or canon of professional ethics may have on this situation. Code Citations: § 36-14-5(a); § 36-14-5(d); 36-14-6; § 36-14-7(a); § 36-14-7(b); Related Advisory Opinions: A.O. 2005-22 A.O. 2002-27 A.O. 2002-10 A.O. 2002-11 Keywords: Class Exception