Under California’s Political Reform Act, a public official may be disqualified from participating in government decisions in some situations. If there is a conflict of interest involving an official that puts them at a financial advantage, they can make biased decisions that may adversely affect the public.
What financial interests are considered disqualifying?
There are certain financial interests for a public official that are disqualifying and would be considered public corruption if the official makes decisions in spite of them. They include the following:
• Business entity: If the public official has an investment in a business entity that’s worth $2,000 or greater and they are an official of that business as an employee, manager, partner, trustee, officer or director, then it’s considered disqualifying.
• Personal finances: If their own personal finances or those of immediate family members, which can include income, assets, expenses or liabilities, would be affected, this is also disqualifying.
• Real property: Real property that the public official has with an interest worth $2,000 or higher is disqualifying. The only exception is a property that has a month-to-month lease.
• Gifts: Gifts given to the public official amounting to $500 or more within the past year are disqualifying.
• Income: Any income $500 or more than the official has received within at least the past year is also considered disqualifying.
When can a decision have a financial impact or effect on a public official?
If the effect or impact on the public official’s finances can be foreseen and material, it’s fair to question whether their decision-making is affected as a result. Public corruption may be a concern if a public official making a decision can directly impact their own financial interests. This is especially the case if the following applies:
• The effect on the public official’s finances will definitely occur.
• The effect on the public official’s finances is significant and can be considered material as a result.
What are the exceptions?
There are exceptions as certain conflicts of interest do not prevent a public official from participating in decision-making. Those exceptions include the following:
• Making the decision results in the effect on the official’s interests being no different from the effect on the public.
• The official is legally required to participate in the decision-making.
However, if there is a conflict of interest that can negatively impact the public while benefiting the public official, the official is required to recuse himself or herself from the decision-making. If the official does not, they might be accused of corruption.
