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Subjects › Legal › Conflicts of Interest
Updated 03/2007

Conflicts of Interest

Contents

Introduction

Washington law governing conflicts of interest in municipal government is derived from the state constitution, from statutes, and from the common or court-made law. These laws include prohibitions relating to elected officials who set their own salaries, to financial interests of municipal officials in certain contracts, and, more generally, to voting on matters in which officials stand to benefit financially. The general rule from which these specific prohibitions against conflicts of interest derive is that a public official may not exercise his or her office to confer a personal benefit upon him or herself. This rule is grounded on the fundamental principle that public officers hold a public trust. Under this principle, public officers are held to a standard of behavior that does not undermine, provide an opportunity to undermine, or appear to undermine that trust.

For an overview of these issues see "Conflicts of Interest" by Bob Meinig, MRSC Legal Consultant, revised July 2004.

Reference Sources

Statutes

Selected Court Decisions

  • Peterson v. Citizens for Des Moines, Inc., 125 Wn. App. 760 (2005), review denied, 157 Wn.2d 1014 (2006). The court of appeals held that a city councilmember who is the president and majority shareholder in a local towing company that city police and other city staff preferred to use when vehicles needed to be towed from city property did not violate the conflict of interest prohibition in RCW 42.23.030. The city had no express or implied contract with the councilmember's towing firm and had no written policies regarding towing requests, and thus there was no contractual interest to implicate the statutory prohibition.
  • City of Raymond v. Michael Runyon, 93 Wn. App. 127 (1998), review denied, 137 Wn.2d 1030 (1999). A city commissioner challenged a finding that he violated RCW 42.23.030 because his interests in city contracts conflicted with his duties as an elected official. The commissioner owned a quarry which sold rock to contractors holding city contracts authorized both before and after he took office. In 1996 he sold the city over $92,000 worth of rock in violation of the statutory limit of $9,000. The court noted that good faith efforts to comply are not a remedy for violation. Any contract violating the statute will be void as to the interested official's interest and result in a statutory fine and forfeiture of office.
  • Barry v. Johns, 82 Wn. App. 865 (1996). A city councilmember challenged the validity of a contract entered into by the city with a nonprofit organization that limits the liability of the organization's board members for discretionary decisions made in their official capacity. The plaintiff councilmember contended that the limitation of liability gives those board members a beneficial interest in the contract. Two city councilmembers were board members. The court held that the beneficial interest in contracts prohibited by RCW 42.23.030 is limited to financial interests. The contract at issue did not confer a financial benefit on the nonprofit organization's board members, because state law provides them with the same benefit. Thus, the court concluded that the contract was not invalid under RCW 42.23.030.
  • Seattle v. State, 100 Wn.2d 232 (1983).  RCW 42.23.030 deals with the "making" of a contract, not with the implementation of the contract after it has been made.  Chapter 42.23 RCW does not require invalidation of the city's campaign finance law.  
  • Smith v. Centralia, 55 Wash. 573 (1909).  Street vacation ordinance held invalid for reason, among others, that councilmember who stood to benefit financially from its enactment cast the deciding vote on the passage of the ordinance.

Selected Attorney General Opinions

  • AGO 1999 No. 1
    A person who is elected to an unexpired term on a city council may not constitutionally receive, during the unexpired term, any changes in compensation previously enacted by the council during that term.
  • AGO 1996 No. 15
    RCW 42.23.030 does not prohibit the service of one spouse as a county commissioner (and ex officio local health board member) while the other spouse serves as administrative officer of the health department; these positions are both public offices and the compensation for them does not arise out of contract.
  • AGO 1978 No. 17
    Except under certain special circumstances whereby the normal relationship between a board of county commissioners and a county housing authority is modified, as discussed in the opinion, the sale of real property by a county commissioner to a county housing authority within the same county does not violate any statutory provision concerning conflicts of interest.
  • AGLO 1973 No. 6
    The provisions of RCW 42.23.010, et seq., prohibiting certain municipal contracts because of "beneficial interests" therein by officers of the municipality do not apply where the officer's interest is not of a pecuniary or financial nature.
  • AGLO 1972 No. 47 
    RCW 42.23.040 does not prohibit the spouse of a chief deputy sheriff who is not covered under the Sheriff's Civil Service Act from being employed as a deputy sheriff. That statute has no applicability to this situation for the simple reason that the sole authority to appoint any deputy sheriffs for a given county is vested in the sheriff himself - and not in any of his deputies.
  • AGLO 1970 No. 89 
    The marriage of a county commissioner to a secretary of one of the other elected officials of the county does not pose a conflict of interest as a result of the secretary's current continuing employment. RCW 42.23.030 does not declare illegal or void any contract that preexisted the appointment or election of the officer to his position of conflict; nor any contract in which an officer acquires an interest in good faith after the contract has been made. The contract itself, although of an indefinite month-to-month nature, is a subsisting contract and one which is not renewed or "made" in each month by any official action of the board, assuming that the contract provisions remain unchanged.
  • AGO 1954 No. 355
    Health and welfare benefits given to elective officials during their present term of office constitute additional compensation and would violate article 11, section 8 of the Washington Constitution.

Documents

Related MRSC Resources