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NYS Comptroller

THOMAS P. DiNAPOLI

The Academy for New York State's Local Officials

Protecting the Public’s Interest: A Tutorial on Local Government Ethics and Transparency in New York State

Module 1 - Conflict of Interest of Municipal Officers and Employees

The Interest of Others

A municipal officer or employee is also deemed to have an interest in the contracts of certain individuals and business entities with which he or she has a relationship. In these instances, the law presumes that a municipal officer or employee receives a benefit as a result of the contract. In other words, once it is established that one of these individuals or business entities has a contract, the municipal officer or employee is automatically considered to have an interest in the contract, without any separate or additional indication that the municipal officer or employee receives a benefit as a result of the contract.

With one exception, municipal officers and employees are deemed to have an interest in the contracts of their spouse, minor children, and dependents. The exception is for contracts of employment with the municipality. For example, if the spouse of a municipal officer or employee is retained by the municipality as an independent contractor, then the municipal officer or employee would be considered automatically to have an interest in the contract between the spouse and the municipality. On the other hand, if the spouse is hired by the municipality as a municipal employee, the municipal officer or employee would not be deemed to have an interest in the spouse's employment contract with the municipality.

It should also be noted that a municipal officer or employee is not deemed to have an interest in the contracts of any person other than his or her spouse, minor children, and dependents. For example, if a municipal officer or employee has a parent or a sibling who is financially independent from the municipal officer or employee, and the parent or sibling is retained by the municipality as an independent contractor, then the municipal officer or employee would not be deemed to have an interest in the contract. Although a municipal officer or employee is not automatically considered to have an interest in a financially independent parent or sibling's contract, the municipal officer or employee may still have an interest in the contract by virtue of receiving a benefit as a result of the contract. For example, if the municipal officer or employee and his or her parent or sibling reside in the same household and pool their incomes to pay common household expenses, then the municipal officer or employee would have an interest in the contract because he or she would receive an indirect financial benefit as a result of the contract.

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