February 17, 2010
Opinion No. 2010-02
Senator Ty Masterson
1539 Phyllis Lane
Andover, Kansas 67002
Dear Senator Masterson:
This opinion is in response to your letter of December 22, 2009,
in which you request an opinion from the Kansas Governmental Ethics
Commission concerning the state governmental ethics laws, K.S.A.
46-215 et seq. We note at the outset that the Commission's
jurisdiction concerning your questions is limited to the
application of K.S.A. 46-215 et seq., and whether some
other statute, common law theory or agency rule or regulation
applies to your inquiry is not covered by this opinion.
FACTUAL STATEMENT:
We understand you request this opinion in your capacity as a
State Senator representing the 16th Senatorial District
for the State of Kansas. You advise us you are a partner in
Advanced Research and Technology Development Group, LLC (ARTDG).
The company is owned by you and Anthony Speer. You are both
licensed real estate agents, development and marketing
professionals working in the Wichita area. The National Institute
for Aviation Research (NIAR), an unincorporated research division
of Wichita State University, contacted your company, ARTDG, looking
for property with specific requirements. NIAR did not retain your
company or either of the partners of the company in an exclusive
agency agreement.
However, your company found a property for NIAR that met the
requirements and ultimately, ARTDG leased 17,500 square feet
subleasing 10,000 square feet to NIAR, 7000 square feet to another
company and keeping 500 square feet for ARTDG for administrative
office space. The contract that was executed between your company,
NIAR, and the Department of Defense (DOD) was below the rate that
NIAR had stated to be acceptable. The funds for this lease came
wholly from federal DOD research dollars.
QUESTION:
You ask if you personally, your private real estate development
partnership, or any entity in which you have an ownership interest,
while you are serving as a State Senator, can engage in business or
real estate transactions with a university or any entity that, in
part or in whole receives funding from the State?
OPINION:
K.S.A. 46-233 states in pertinent part:
"(b) No individual shall, while a legislator or within one year
after the expiration of a term as legislator be interested
pecuniarily, either directly or indirectly, in any contract with
the state, which contract is funded in whole or in part by any
appropriation or is authorized by any law passed during such term,
except that the prohibition of this subsection (b) shall not apply
to any contract interest in relation to which a disclosure
statement is filed as provided by K.S.A. 46-239, and amendments
thereto."
You indicate in your letter that funds for this lease come
solely from DOD research moneys, not State money. However, the
money from DOD does come through the state appropriation process
for Wichita State University and is considered a "no limit
appropriation" for federal funds. Thus, we look to the exemption
found in K.S.A. 46-239 (c).
K.S.A. 46-239 (c) reads in pertinent part:
"Any agency of the state of Kansas which enters into a contract
with any legislator, or any member of a firm of which such
legislator is a member, under which the legislator or the member of
such firm is to perform services for such agency for compensation
shall make a report on a form prescribed and provided by the
commission giving the name of the state agency, the purpose of the
employment and the method of determining and computing the
compensation for such employment. All such forms shall be filed
quarterly in the office of the secretary of state."
If Wichita State University, in this case, files such a report
quarterly with the office of the Kansas Secretary of State, there
would not be a violation of this statute.
We draw your attention to two other statutes that would apply in
your case.
K.S.A. 46-238 states:
"No state officer or employee or candidate for state office or
associated person shall charge to or accept from a person known to
have a special interest a price, fee, compensation or other
consideration for the sale or lease of any property or the
furnishing of services which is substantially in excess of that
which other persons in the same business or profession would charge
in the ordinary course of business."
If the terms of your lease agreement with NIAR/DOD do not
substantially exceed the amount which other persons in the same
business or profession would charge in the ordinary course of
business, this statute would not be violated.
K.S.A. 46-241 states:
"No state officer or employee shall disclose or use confidential
information acquired in the course of his or her official duties in
order to further his or her own economic interest or those of any
other person."
This statute prohibits you from using any confidential knowledge
obtained in your employment with the State for your financial gain
or for the financial gain of any other person.
Based upon the facts you have provided to the Commission, the
lease agreement with NIAR/DOD does not appear to violate the state
governmental ethics laws provided the requirements of K.S.A.
46-238, K.S.A. 46-239 (c) and K.S.A. 46-241 are met.
Sincerely,
Tim Emert, Vice-Chairman
By Direction of the Commission
SKS/JAM/dlw
