27 Staff Report - Amending Conflict of Interest Provisions of the Town CodeCOUNCIL AGENDA
DATE: 9/7/92
ITEM NO. 27
TOWN OF LOS GATOS
COUNCIL AGENDA REPORT
DATE: SEPTEMBER 4, 1992
TO: MAYOR AND TOWN COUNCIL
FROM: TOWN CLERK
SUBJECT: INTRODUCTION OF ORDINANCE AMENDING CONFLICT OF INTEREST PROVISIONS
OF THE TOWN CODE.
RECOMMENDATION: Introduce amendments to the Conflict of Interest section of the Town Code and
direct the Redevelopment Agency to consider similar amendments.
1. Discuss the need for amendments to the current Ordinance.
2. Waive the reading of the Draft Conflict of Interest Ordinance.
3. Introduce amended Conflict of Interest Code.
4. Instruct staff to notify the Redevelopment Agency that it must consider similar
amendments.
5. Approve policy having Town contracts with consultants contain a statement
regarding the need for financial disclosure.
6. Consider the need for further study of this section of the Town Code.
7. Authorize Manager to sign report to the FPPC regarding Conflict of Interest Code.
BACKGROUND:
In 1990 Government Code Section 87306.5 was added to the Political Reform Act requiring every local
agency to review its Conflict of Interest Code every two years. This creates the need for Council to notify
the Redevelopment Agency, within its jurisdiction, to also review its Conflict of Interest Code.
In reviewing Town's previous and existing Conflict of Interest Code it appears that amendments are needed.
The Planning Commission should be added due to the fact that the FPPC requires the Commissioner's
Conflict of Interest forms be filed with the FPPC annually. Business position statements should also appear
as amendments and requirements of consultants, identified as employees in the Code, should be addressed
at this time.
The Town Attorney has completed a preliminary review of the proposed revisions to the Town's Conflict
of Interest Code and has indicated that Council must consider the addition of appointed Boards and
Commissions and designated employees who conduct research, investigation, and prepare reports which
can influence the decision making process.
PREPARED BY: MARIAN V. COSGROVE, TOWN CLERI
MVC:mjr
TC:D4:CON-INT.TC 9/4/92 3:30 P.M.
Distribution: Regular Distribution
Reviewed by: ✓ Attorney Manager Finance Treasurer
COUNCIL ACTION/ACTION DIRECTED TO:
PAGE 2
MAYOR AND TOWN COUNCIL
SCHEDULE OF PUBLIC HEARINGS
DATE: 9/4/92
Section 2.30.610 of the proposed Ordinance lists those employees who fall within the boundaries of the
Town Attorney's opinion and are also included by all other jurisdictions in their lists of designated employees.
The Town Attorney has stated that Government Code Sec 87306.5 explicitly requires certification that the
code accurately designates all positions which make or participate in making governmental decisions and
further suggests that any list of designated employees be on the side of being over -inclusive.
DISCUSSION: Consultants fall within the definition of all designated employees that must report the
same financial interests that are required to be reported by officials named in Government Code Section
87200. This obligation can be waived at the time of contract negotiation by the Town Manager if it appears
that no conflict exists. The Council can make these findings at the time of contract approval and the
statement will be filed with the Town Clerk.
ATTACHMENTS:
Exhibit A:
Exhibit B:
Exhibit C:
Exhibit D:
FINANCIAL IMPACT:
Ordinance with amendments to be introduced.
Our original Town Code with proposed amendments.
Opinion of Town Attorney regarding Government Code requirements
affecting Local Agency's Conflict of Interest Code.
Report to FPPC acknowledging either the need to amend our present code
or reporting that no amendment is necessary.
* Copy and Mailing costs
* Staff Time
$ 500.00
$2000.00
PREPARED BY: MARIAN V. COSGROVE, TOWN CLERK
MVC:mjr
TC:D4:CON-INT.TC 9/4/92 3:30 P.M.
Distribution: Regular Distribution
Reviewed by:
Attorney Manager Finance Treasurer
COUNCIL ACTION/ACTION DIRECTED TO:
ORDINANCE
ORDINANCE OF THE TOWN OF LOS GATOS
AMENDING DIVISION 4, SECTION 2.30.605 THROUGH 2.30.625
RELATING TO CONFLICT OF INTEREST CODE
The Town Council of the Town of Los Gatos does hereby ordain:
SECTION I
Section 2.30.605 of the Conflict of Interest Code is amended to read:
Sec. 2.30.605. Adoption of standardized code.
Government Code section 87300 requires local agencies to adopt a conflict of
interest code. The State Fair Political Practices Commission has adopted a regulation, 2
California Administrative Code section 18730, which contains the terms of a standard
conflict of interest code, which local agencies are authorized to incorporate by reference,
and which may be amended by the Fair Political Practices Commission to conform to
amendments and State law after public notice and hearings. Pursuant to that authority, the
terms of 2 California Administrative Code section 18730 and any amendments to it duly
adopted by the Fair Political Practices Commission are hereby incorporated by reference,
together with the other sections in this article, as the Conflict of Interest Code of the Town
of Los Gatos, which is considered the "agency" within the purview of this code.
SECTION II
Section 2.30.610 of the Conflict of Interest Code is amended to read:
Sec. 2.30.610. Designated employees.
This section shall constitute the appendix referred to in section 2 of the standardized
conflict of interest code. The Council hereby finds that the officers and employees holding
the following designated positions make, or who participate in the making of decisions
which may foreseeably have a material effect on financial interests, are therefore designated
employees of the Town of Los Gatos and required to make financial disclosure.
f�i13IT 'o%'
DESIGNATED POSITIONS
ADMINISTRATION
Town Council
Town Manager
Assistant Town Manager
Town Attorney
Legal Assistant
Town Clerk
Senior Deputy Clerk
Town Treasurer
Deputy Town Treasurer
Finance Manager
Accounting/Auditing
Personnel Manager
Information Systems Manager
BUILDING & ENGINEERING DEPARTMENT
Director of Building
and Engineering Services
Associate Civil Engineer
Plan Check Engineer
Chief Inspector
Building Inspector
Engineering Inspector
Assistant Engineer/
Assistant Civil Engineer
PLANNING DEPARTMENT
Planning Director
Senior Planner
Associate Civil Engineer
Planner I/II
Code Compliance Officer
Senior Engineering Technician
COMMUNITY SERVICES
Community Services Director
Transit Program Coordinator
Housing Specialist
TOWN LIBRARY
Library Director
Senior Librarian
Librarian 1, 2, 6, 9
DISCLOSURE CATEGORY
Govt. Code
Govt. Code
1, 4, 5, 7, 8,
Govt. Code
1, 4, 5, 7, 8,
1, 5
1, 5
Govt. Code
1, 2, 4, 5, 6,
1, 4, 5, 6, 7,
1, 5
1,4,5,6,7
#87200 et seq.
#87200 et seq.
10
#87200 et seq.
10
#87200 et seq.
7
8, 10
1,2,3,4,5,7
1,2,3,5,6,8
1, 2, 3, 4, 5, 7
1,2,3,4,5,7
1,2,3,4,5,7
1,2,3,5,7
1,2,3,5,7
1,2,4,7
1,2,4,7
1,2,4,6,8
1,2,4,7
1,2,4,7
1,2,3,4,5,7
1,2,3,4,5,7
1,2,3,4,5,7
1, 2, 3, 4, 5, 7
1, 2, 6, 9
1, 2, 6, 9
2
POLICE DEPARTMENT
Chief of Police
Police Commander
Police Sergeant
PARKS, FORESTRY & MAINTENANCE
Director of Parks
Forestry and Maintenance
Maintenance Superintendent
Parks & Forestry Superintendent
Public Works Maintenance Supervisor
Parks Maintenance Supervisor
Town Arborist
1,2,5,7
1, 2, 5, 7
1,2,5,7
1,2,4,5,7
1, 4, 5, 7
1, 2, 4, 5, 7
1, 4, 5, 7
1,2,4,5,7
1, 4, 5, 7
COMMISSIONERS, COMMITTEE AND BOARD MEMBERS
Arts Commission
Board of Appeals
Community Services Commission
Conceptual Development Advisory
Development Review Committee
Historic Preservation Committee
Library Board
Park Commission
Parking Commission
Personnel Board
Planning Commission
Redevelopment Advisory Committee
Rent Advisory Committee
Sister City Committee
Trails Committee
Youth Advisory Commission
SPECIFIED CONSULTANTS
Those consultants likely to participate
in the making of a governmental decision as
determined by the Town Manager in writing.
REDEVELOPMENT
Agency Officials
Executive Director
Deputy Director
General Counsel
Finance Director
Agency Secretary
Agency Treasurer
Agency Department Heads
1, 5
1,2,3,4,5,7
1,2,5,7
1, 2, 4, 7
1,2,4,7
1,2,3,4,5,7
1,2,5,9
1,2,5
1, 2, 4, 5, 7
1, 5
Govt. Code #87200 et seq.
1, 2, 3, 4, 5, 7
1,2,3,4,5,7
1, 5
1,2,5,7
1, 5
1, 2, 5, 7
Govt. Code #87200 et seq.
Govt. Code #87200 et seq.
1,4,5,7,8
Govt. Code #87200 et seq.
1,2,4,5,6,7
1, 5
Govt. Code #87200 et seq.
as stipulated in Town Code
3
SECTION III
Section 2.30.615 of the Conflict of Interest Code is amended to read:
Sec. 2.30.615. Disclosure categories.
This section shall constitute the appendix referred to in section 3 of the standardized
conflict of interest code in which disclosure categories are set forth.
General Provisions
When a designated employee is required to disclose investments and sources
of income, he or she need only disclose investments in business entities and
sources of income which do business in the jurisdiction, plan to do business
in the jurisdiction or have done business in the jurisdiction within the past two
years. In addition to other activities, a business entity is doing business within
the jurisdiction if it owns real property within the jurisdiction. When a
designated employee is required to disclose interests in real property, he or
she need only disclose real property which is located in whole or in part
within or not more than two miles outside the boundaries of the jurisdiction
or within two miles of any land owned or used by the local government
agency.
Designated employees shall disclose their financial interests pursuant to the appropriate
disclosure category as indicated in Section 2.30.610.
Disclosure Categories:
Category 1:
Category 2:
Category 3:
All investments and sources of income.
All interests in real property.
All investments, interests in real property and sources of income subject
to the regulatory, permit or licensing authority of the department.
4
Category 4:
Category 5:
Category 6:
Category 7:
Category 8:
Positions held and investments in business entities and sources of income
which engage in land development, construction or the acquisition or sale
of real property.
Positions held and investments in business entities and sources of income
of the type which, within the past two years, have contracted with the
Town of Los Gatos to provide services, supplies, materials, machinery or
equipment.
Positions held and investments in business entities and sources of income
of the type which, within the past two years, have contracted with the
designated employee's department to provide services, supplies, materials,
machinery or equipment.
Positions held and investments in business entities located in the Town of
Los Gatos proper or in any land or facilities used, owned, or operated by
the Town of Los Gatos.
Positions held and investments in business entities or investments with
natural persons that have contractual obligations or privileges with the
Town of Los Gatos.
Category 9: All interests in real property located within two miles of any library facility
or within two miles of the site acquired for a library facility.
Category 10: All interests in real property located within the Town of Los Gatos or
within two miles thereof.
SECTION IV
Section 2.30.625 of the Conflict of Interest Code is amended to read:
Sec. 2.30.625. Filing of Statements
Designated employees shall file statements of economic interets with the Town Clerk
who shall be and perform the duties of filling officer for the Town of Los Gatos.
5
SECTION V
This Ordinance takes effect 30 days after the date it is adopted. Within 15 days
after this Ordinance is adopted, the Town Clerk shall cause it to be published once in a
newspaper of general circulation published and circulated in the Town.
This Ordinance was introduced at a regular meeting of the Town Council of the
Town of Los Gatos on September 7, 1992, and adopted by the following vote as an
Ordinance of the Town of Los Gatos at a meeting of the Town Council of the Town of Los
Gatos on September 21, 1992.
COUNCIL MEMBERS:
AYES:
NAYS:
ABSENT:
ABSTAIN:
SIGNED:
MAYOR OF THE TOWN OF LOS GATOS
LOS GATOS, CALIFORNIA
A"1"1'EST:
CLERK OF THE TOWN OF LOS GATOS
LOS GATOS, CALIFORNIA
TC:D4:CON-INT.TC
6
LOS GATOS TOWN CODE
DIVISION 4. CONFLICT OF INTEREST
Sec. 2.30.605. Adoption of standardized code.
Government Code section 87300 requires local agencies to adopt a conflict of interest code. The
State Fair Political Practices Commission has adopted a regulation, 2 California Administrative Code section
18730, which contains the terms of a standard conflict of interest code, which local agencies are authorized
to incorporate by reference, and which may be amended by the Fair Political Practices Commission to
conform to amendments and State law after public notice and hearings. Pursuant to that authority, the terms
of 2 California Administrative Code section 18730 and any amendments to it duly adopted by the Fair
Political Practices Commission are hereby incorporated by reference, together with the other sections in this
article, as the Conflict of Interest Code of the Town ` s ? is t Ttli#0 t)
(Code
Sec. 2.30.610. Designated employees.
This section shall constitute the appendix referred to in section 2 of the standardized conflict of
interest code. The Council hereby finds that the fallowing persons �'e`
tto In d. ig► : > lons make or participate in the making of decisions which may foreseeably have
a material effect on financial interests, and are therefore designated employees the EMl hs c s
l{•P:{4T:^.':'?�{::r.Y:ti{S•,;r,:::{:::: {.; vy..�xv{•'•:K?:4?•:y.:S^: : Y
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(Code 1968, § 2-61)
Sec. 2.30.615. Disclosure categories.
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This section shall constitute thappendix referred to in section 3 of the standardized conflict of
interest code KisfrigoIA:40:47,-2......egories aa.$t rttt All-designated-empleyees-shell-repen-the-saffie
flnancial interests that are required to be reported by officials named in Covernment Gode 3ection 07200.
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TC:D4:CON•INT.TC
10
1r1 EM 0 RANDUM
DATE: September 2, 1992
TO: Marian Cosgrove, Town Clerk
FROM: Katherine Anderton, Town Attorney --
SUBJECT: Amendment to Conflict of Interest Code
I have completed a preliminary review of the revisions to the Town's Conflict of
Interest Code as you requested. My most immediate concern is related to the employees
and commission and board members required to make financial disclosures.
Government Code Sec. 87302 requires that the Town's Code contain:
"specific enumeration of the positions within the agency, other than those specified
in sec 87200, which involve the making or participation in the making of decisions
which may foreseeably have a material effect on any financial interest and for each
such enumerated position, the specific investments, business positions, interests
in real property, and sources of income which are reportable..." (emphasis added).
It appears that "the positions within the agency" should include all those "public
officials" who are required to make financial disclosures under Government Code Section
87100. The California Code of Regulations ("the CCR), which contains regulations
adopted by the Fair Political Practices Commission to implement the Government Code
conflicts requirements, defines such public officials in Sec 18700, a copy of which is
attached.
The Town's code currently requires disclosures only from: all elected officials, the
Town attorney, Town Manager, Assistant Manager, the firiance director and department
heads appointed by the manager. You have proposed adding the planning commission.
As you can see, public officials under the CCR include all commission members
which "make substantive recommendations which are, and over an extended period of
time have been, regularly approved without significant amendment or modification by
another public official or governmental agency." (CCR Sec 18700 (a)(1)(C). Although
there may be some dispute as to whether the Council actually relies on committee and
commission recommendations without significant amendment or modification, at a
minimum, each such board, committee or commission should be carefully evaluated to
see if it meets the test articulated in the CCR.
It would certainly be the safest course to include all Council appointed Boards and
Commissions. Since the code must also specify the types of required disclosures, it
appears that this requirement could be implemented without becoming unduly
burdensome.
All employees should also be evaluated to ensure that the Code's list is
comprehensive. For this purpose, I would suggest focus on the CCR definition of
"participat[ion] in the making of governmental decisions" (CCR Sec 18700 (c). As you can
see, advice to the decision maker without significant intervening substantive review by
EX hI3ir ''C"
conducting research or investigation which requires the exercise of judgment, and
preparing reports which require the exercise of judgment, require the employee to be
designated. You may determine that department heads exercise "significant intervening
substantive review" over virtually all employees in their departments. In reaching this
determination, it may be helpful to circulate to department heads some form of survey for
their identification of employees they supervise who fall in the defined category for any of
the stated reasons. 1 would recommend, that any close calls be resolved on the side of
being over -inclusive.
As you know, Government Code Sec 87306.5 explicitly requires certification that
the code accurately designates all positions which make or participate in making
governmental decisions and all other requirements of Sec 87302. It appears, however,
that if communication with the FPPC is completed before October 1, the actual code
revisions may be completed and forwarded thereafter.
Please do not hesitate to discuss any questions or concerns which this memo may
raise.
cc: David W. Knapp
t7t�18/ r- 'C,,
18700. Public Official Making, or Participating in Making a
Governmental Decision (87100)
The provisions herein define terms as used in Chapter 7
of the Political Reform Act of 1974, as amended, Government Code
Sections 87100-87312.
(a) "Public official at any level of state or local
government" means every natural person who is a member, officer,
employee or consultant of a state or local government agency.
(1) "Member" shall include, but not be limited
to, salaried or unsalaried members of boards or
commissions with decision -making authority. A board or
commission possesses decision -making authority
whenever:
(CEB 8/85)
(A) It may make a final governmental
decision;
(B) It may compel a governmental decision;
or it may prevent a governmental decision either
by reason of an exclusive power to initiate the
decision or by reason of a veto which may not be
overridden; or
(C) It makes substantive recommendations
which are, and over an extended period of time
have been, regularly approved without significant
1 18700
EX f-Fi g, r '�C "
amendment or modification by another public
official or governmental agency.
(2) 'Consultant' shall include any natural person
who provides, under contract, information, advice,
recommendation or counsel to a state or local
government agency, provided, however, that "consultant"
shall not include a person who:
(A) Conducts research and arrives at
conclusions with respect to his or her rendition
of information, advice, recommendation or counsel
independent of the control and direction of the
agency or of any agency official, other than
normal contract monitoring; and
(B) Possesses no authority with respect to
any agency decision beyond the rendition of
information, advice, recommendation or counsel.
(b) A public official 'makes a governmental decision,"
except as provided in subsection (d) of this section, when he or
she, acting within the authority of his or her office:
(1) Votes on a matter;
(2) Appoints a person;
(3) Obligates or commits his or her agency to any
course of action;
(4) Enters into any contractual agreement on
behalf of his or her agency;
(CEE 8/85)
2
18700
EX bti & r "C .
(5) Determines not to act, within the meaning of
sub -paragraphs (1) , (2) ,- (3) or (4) , unless such
determination is made because of his or her financial
interest. When the determination not to act occurs
because of his or her financial interest, the
official's determination must be accompanied by
disclosure of the financial interest, made part of the
agency's official record or made in writing to the
official's supervisor, appointing power or any other
person specified in a conflict of interest code adopted
pursuant to Government Code Section 87300.
(c) A public official or designated employee
"participates in the making of a governmental decision" when,
acting within the authority of his or her position, he or she:
(1) Negotiates, without significant substantive
review, with a governmental entity or private person
regarding the decision; or
(2) Advises or makes recommendations to the
decision -maker, either directly or without significant
intervening substantive review, by:
(A) Conducting research or making any
investigation which requires the exercise of
judgment on the part of the official or designated
employee and the purpose of which is to influence
the decision; or
(CEB 8/85)
3 18700
fANii317- C,"
(B) Preparing or presenting any report,
analysis or opinion, orally or in writing, which
requires the exercise of judgment on the part of
the official or designated employee and the
purpose of which is to influence the decision.
(d) Making or participating in the making of a
governmental decision shall not include:
(1) Actions of public officials which are solely
ministerial, secretarial, manual or clerical;
(2) Appearances by a public official as a member
of the general public before an agency in the course of
its prescribed governmental function to represent
himself or herself on matters related solely to his or
her personal interests; or
(3) Actions by public officials, employees, or
employee representatives relating to their compensation
or the terms or conditions of their employment or
contract.
(Gov. Code Section 87100)
History: (1) New section filed 1/22/76; effective
2/21/76.
(2) Amendment filed as emergency 8/22/76;
effective upon filing.
(3) Amendment to (a) (1) (B) and (a) (1) (C)
filed as emergency 9/28/76; effective
upon filing.
(4) Amendment filed as emergency 12/17/76;
effective upon filing.
(5) Certificate of Compliance filed 3/31/77.
(6) Amendment filed 8/2/85; effective
9/1/85.
(CEB 8/85) 4 18700
")X1-fI23IT"C„
FEB ±S 11:47 FROM C!5 FPPC
Pk' . UUt
LOCAL AGENC BUE IIAL_REPORT
Government Code Section 87306.5 requires local agencies to
submit to their code reviewing body a biennial report identifying
changes in its code, or a statement that their code is not in need
of amendment. Such reports shall be submitted no later than
October 1 of each even -numbered year. The first report is due 3'lp
later than October 1, 1992 and is to be returned to your agencies
respective code reviewing body (Section 82011.). You may use this
form or you may prepare your own report. When completed, all
reports must be mailed to:
(PLACE RETURN ADDRESS OF CITY OR COUNTY HERE TO ASSIST
AGENCIES WITH LOCATION IN WHICH TO RETURN THEIR COMPLETED
BIENNIAL, REPORTS OR STATEMENTS.)
# # #
This agency has reviewed its conflict of interest code and
has determined that:
1)
2)
Our agency's code accurately designates all positions
which make or participate in the making of governmental
decisions; that the disclosure assigned those positions
accurately requires the disclosure of all investments,
business positions, interests in real property and
sources of income which may foreseeably be affected
materially by the decisions made by those designated
positions; and further that the code includes all other
provisions required by Government Code Section 87302;
or,
Our agency's code is in need of amendment. We have
determined that the following amendments are necessary
(check applicable items):
Include new positions which must be designated
Make changes to the reportable sources of income,
investments, business positions, or real property
Make changes to the positions assigned
Change or add the provisions required by
Government Code Sections 87302
Contact Person
Name of Agency
Mailing Address
(Signature of Chief Executive Officer)
Note: Government Code Section 87306 requires that when an agency
has determined that amendments are necessitated by changed
circumstances, the amendments or revisions shall be submitted to
the code reviewing body within 90 days.
4 :+; TOTAL PP 3E . 005