Need ethical advice? I’m here to help!

So, Clark County Commissioner Larry Brown is in need of some ethical advice. He’s asked the state Ethics Commission whether he, as an employee of the Las Vegas 51s baseball team, may vote as a member of the commission on issuing bonds to provide a subsidy for the new owners of that team to build an arena in Summerlin.

Now, some of you may be saying, “Duh. No, obviously.” And that’s understandable. But what’s the real answer, the legal answer? Although Brown asked for an advisory opinion last spring, the commission hasn’t yet written back. Those hardworking folks in Carson City are probably backlogged, but I bet they wouldn’t mind if I took a whack at the question.

So, here goes, my official unofficial opinion in the matter of In Re: Larry Brown.

Question

Commissioner Brown has asked whether he, as an employee of the Las Vegas 51s baseball team, may vote upon and/or advocate on the issuance of bonds sought by the team’s owners in order to construct a new baseball stadium in the Summerlin area of Las Vegas, near the Red Rock Resort.

Facts

Commissioner Brown has worked as manager of community relations for the Las Vegas 51s, a Triple-A minor league franchise playing in the Pacific Coast league, for years, and his employment pre-dates his election to the commission in 2009. Prior to working for the team, Brown was a player, starting in 1983 when the franchise was known as the Las Vegas Stars.

The Las Vegas 51s were recently purchased by a new ownership group, which has expressed an interest in moving the team from its current location at Cashman Field Center to a new location in Summerlin. Owners have indicated they will seek public funding to help defray the costs of the new stadium, and that they will ask local governments including the county commission to subsidize construction of the stadium. (I have already opined on the propriety of that decision in a column in the Review-Journal.)

Ethics in Government law

The Ethics in Government Law is found at NRS 281A.010, et. seq. NRS 281.020 states the purpose of the law generally:

1.  It is hereby declared to be the public policy of this State that:

(a) A public office is a public trust and shall be held for the sole benefit of the people.

(b) A public officer or employee must commit himself or herself to avoid conflicts between the private interests of the public officer or employee and those of the general public whom the public officer or employee serves. (emphasis added)

Further, NRS 281A.400(2) says:

NRS 281A.400  General requirements; exceptions.  A code of ethical standards is hereby established to govern the conduct of public officers and employees:

2.  A public officer or employee shall not use the public officer’s or employee’s position in government to secure or grant unwarranted privileges, preferences, exemptions or advantages for the public officer or employee, any business entity in which the public officer or employee has a significant pecuniary interest, or any person to whom the public officer or employee has a commitment in a private capacity to the interests of that person. As used in this subsection, “unwarranted” means without justification or adequate reason.

And NRS 281A.065 defines “commitment in a private capacity to the interests of others” thus:

NRS 281A.065  “Commitment in a private capacity” defined.  “Commitment in a private capacity,” with respect to the interests of another person, means a commitment, interest or relationship of a public officer or employee to a person:

1.  Who is the spouse or domestic partner of the public officer or employee;

2.  Who is a member of the household of the public officer or employee;

3.  Who is related to the public officer or employee, or to the spouse or domestic partner of the public officer or employee, by blood, adoption, marriage or domestic partnership within the third degree of consanguinity or affinity;

4.  Who employs the public officer or employee, the spouse or domestic partner of the public officer or employee or a member of the household of the public officer or employee; (emphasis added)

5.  With whom the public officer or employee has a substantial and continuing business relationship; or

6.  With whom the public officer or employee has any other commitment, interest or relationship that is substantially similar to a commitment, interest or relationship described in subsections 1 to 5, inclusive.

Finally, NRS281A.420(3) states:

3.  Except as otherwise provided in this section, in addition to the requirements of subsection 1, a public officer shall not vote upon or advocate the passage or failure of, but may otherwise participate in the consideration of, a matter with respect to which the independence of judgment of a reasonable person in the public officer’s situation would be materially affected by:

(a) The public officer’s acceptance of a gift or loan;

(b) The public officer’s significant pecuniary interest; or

(c) The public officer’s commitment in a private capacity to the interests of another person.

And that section goes on to say, in subsection 4:

4.  In interpreting and applying the provisions of subsection 3:

(a) It must be presumed that the independence of judgment of a reasonable person in the public officer’s situation would not be materially affected by the public officer’s acceptance of a gift or loan, significant pecuniary interest or commitment in a private capacity to the interests of another person where the resulting benefit or detriment accruing to the public officer, or if the public officer has a commitment in a private capacity to the interests of another person, accruing to the other person, is not greater than that accruing to any other member of any general business, profession, occupation or group that is affected by the matter. The presumption set forth in this paragraph does not affect the applicability of the requirements set forth in subsection 1 relating to the disclosure of the acceptance of a gift or loan, significant pecuniary interest or commitment in a private capacity to the interests of another person.

(b) The Commission must give appropriate weight and proper deference to the public policy of this State which favors the right of a public officer to perform the duties for which the public officer was elected or appointed and to vote or otherwise act upon a matter, provided the public officer has properly disclosed the public officer’s acceptance of a gift or loan, significant pecuniary interest or commitment in a private capacity to the interests of another person in the manner required by subsection 1. Because abstention by a public officer disrupts the normal course of representative government and deprives the public and the public officer’s constituents of a voice in governmental affairs, the provisions of this section are intended to require abstention only in clear cases where the independence of judgment of a reasonable person in the public officer’s situation would be materially affected by the public officer’s acceptance of a gift or loan, significant pecuniary interest or commitment in a private capacity to the interests of another person.

Discussion

Commissioner Brown is a public officer within the meaning of the Ethics in Government statute (SEE, NRS 281A.160:  Brown is elected to a political subdivision of the state of Nevada, to wit, the Board of County Commissioners for Clark County; he exercises public power, trust and duty, to wit, a substantial and material exercise in the administration of public policy, the expenditure of public money and the administration of laws and rules in Clark County).

The owners of the Las Vegas 51s are seeking a public benefit, namely a subsidy (reportedly in the amount of $65 million) from, among others, Clark County. That subsidy would assist the owners of the franchise in defraying the costs of building a new stadium for their team, a stadium that would enhance the value of the team and the profits derived therefrom.

Commissioner Brown, as a longtime employee of the Las Vegas 51s, has a commitment in a private capacity to the interests of the owners, managers and employees of the Las Vegas 51s, as the same is defined in NRS281A.065(4), to wit, he is employed by those persons. Therefore, Commissioner Brown is prohibited from securing or granting an unwarranted privilege, preference, exemption or advantage for the franchise, inasmuch as he maintains a commitment in a private capacity to the interests of the owners, managers and employees of the Las Vegas 51s.

The propriety of issuing bonds to subsidize the construction of a private stadium is a policy matter for the elected officials in Clark County (at least those who do not face the obvious conflict of interests faced by Commissioner Brown). It may be argued that a vote in favor of bonds to provide a subsidy to the owners of the Las Vegas 51s is not “unwarranted,” inasmuch as there are justifications or adequate reasons that may be proffered by those owners for the building of a stadium. For example, the economic benefit of increased ticket sales; the additional visits to local merchants, restaurateurs and other businesses located near the stadium; making the current Cashman Field Center site available for a higher or better use; and the provision of sporting events or recreational opportunities for the residents of Las Vegas, including Commissioner Brown’s constituents.

But it could equally be argued that providing a subsidy to a particular team while not providing the same to other similarly situated persons constitutes an “unwarranted” benefit. There are currently at least four stadium projects under consideration or underway in Las Vegas: Symphony Park; the former Wet-N-Wild site on the Las Vegas Strip; the MGM Resorts International arena project on Frank Sinatra Drive; and an abortive stadium site in Henderson (for which land is still designated for stadium construction). Granting a request from one ownership group — especially one that happens to employ a county commissioner — while not extending the same consideration to other would-be stadium builders (all of whom may make the same arguments for the benefits of construction) opens the county to charges of conferring a special, unwarranted benefit.

There is, however, an additional reason for Commissioner Brown to refrain from voting or advocating on the matter at bar.

Given his commitment in a private capacity to the interests of the owners, managers and employees of the Las Vegas 51s, Commissioner Brown is also prohibited from voting or advocating the passage or defeat of any proposal to issue bonds by NRS 281A.420(3), in asmuch as the independence of judgment of a reasonable person would be materially affected by his commitment in a private capacity to the interests of his employers.

Notably, as outlined in NRS281A.420(4), Commissioner Brown cannot claim that the resulting benefit accruing to the Las Vegas 51s is not greater than that accruing to any other member of the general business, profession, occupation or group that is affected by the matter. In this case, only the Las Vegas 51s are benefited by the issuance of bonds to subsidize construction of a sports arena, one they will own and operate for private benefit. No other would-be stadium owner or builder will benefit in any way; in fact, it may be argued they will be harmed by the competitive advantage sought by the Las Vegas 51s, as well as the dilution of the market for new stadiums in Las Vegas that would presumably occur should the Summerlin stadium be built.

Conclusion

As a result of the foregoing, Commissioner Brown is prohibited from voting or advocating the passage or failure of the issuance of bonds to subsidize a stadium sought by his employers, the owners, managers and employees of the Las Vegas 51s, because he maintains a commitment in a private capacity to the interests of those owners, managers and employees; such a vote would confer an unwarranted benefit upon the owners, managers and employees of the Las Vegas 51s; and the independence of judgment of a reasonable person would be compromised by his commitment in a private capacity to the interests of his employers.

 

One Response to “Need ethical advice? I’m here to help!”

  1. Steve says:

    OR,,,Duh. AND Duh again cause the spam filter doesn’t like short comments.

    duh.