BOS created policy for “Special Municipal Employees” and grant status to EDC members

by beth on October 25, 2019

Last week, the Board of Selectmen finalized and approved a policy on the process for handling “Special Municipal Employees”. They followed with a vote to grant SME status to members of the Economic Development Committee.

Both actions caused some disapproving comments on the blog, and I’m finally getting around to covering what happened and what it means.

As I previously posted, even unpaid members of Town boards/committees are legally considered Municipal Employees. Towns can grant a “Special” status to some that allows  more flexibility regarding what is/isn’t a conflict of interest. That status must apply to the position (e.g., all members of the EDC) rather than a specific person.

The apparent intent is to allow members to serve when there isn’t a real concern about a conflict of interest, but the rules would prohibit someone from serving. Examples given were along the lines of – a member of the Public Safety Building Commmittee could work for a company that has completely unrelated business in front of another committee.

Some residents have expressed concern that loosening conflict laws could lead to corruption. Selectman Marty Healey argued that the rules create “traps” for regular MEs that some officials have likely violated without knowing it. He advocated creating a process to clarify rules to follow when situations come up for SMEs. That process would force SMEs to report those conflicts to the Town when they become aware of them or risk losing the SME status.

Selectmen don’t plan to grant the status to positions with great power. The policy states:

In general, positions, committees and boards that have the authority to set Town policy, have regulatory or quasi-judicial authority, or have appointing authority, should not be granted Special Municipal Employee classification. Examples of such positions include, but are not limited to: Town Counsel; the Conservation Commission; the Planning Board; and, the Zoning Board of Appeals.

Resident Karen Hanlon Shimkus objected to the board creating a policy to allow SMEs. She stated that most Towns don’t have them. Healey rebutted that the ability to grant SMEs is covered by state law. He asserted that most Towns do grant the designation, just without a policy. He followed that Southborough has granted SME status in the past on an ad hoc basis.* He opined that it was better to create a transparent process.

The new policy was prompted by a request from EDC member Dave McCay to grant the status to members of his committee. Some selectmen weren’t comfortable in granting the status without a policy to address future requests from other volunteers. A draft policy was worked out between members over multiple public meetings.

At a prior meeting, selectmen opted to delay their vote to allow absent Selectwoman Lisa Braccio to weigh in on the final language. At last week’s meeting, Braccio opined that granting SME status should not be done by blanket policy and should not be commonly granted. She requested adding language that not following the reporting process would cause members to lose SME status. She agreed to soften that to “may”, allowing selectmen to review the situation.

In contrast, McCay urged removing all language about reporting conflicts. He argued that volunteers would already have to report the conflicts to the state and copy the Town. He objected to volunteers having to file two forms. Healey argued that granting the SME status would remove volunteers’ requirement to file with the state under the situations outlined in the process. Thus, the Town needs to ensure the conflicts are reported to them.

There was some back and forth about conflict language that included employers having business in front of the Town. McCay, Selectman Dan Kolenda, and resident Tim Litt all pointed out that many people wouldn’t be able to know all that their employer is doing, especially a large company. Selectmen agreed on language qualifying “to their knowledge”.

McCay also objected to a section stating that selectmen would review SME status each year. He said that volunteers shouldn’t have watch for an annual agenda itme to “sing for their supper” each year or risk losing the status. Selectmen agreed that if they considered revoking any SME status, SMEs would be notified in advance of the agenda item.

Once the policy was hatched out, it was time to vote on whether or not to grant the SME status to the EDC. Calling herself a “stickler for process”, Braccio objected to a vote as violating specific terms they just approved. The selectwoman argued that the request was supposed to come from the EDC, not one member. 

Chair Brian Shea pointed out that the policy allows for granting SMEs to be a selectmen initiative. Braccio responded that it wasn’t technically that either. She advised that the EDC should vote on the issue, then make their presentation on why the status is needed. She furthered that would allow them to ask other members about potential conflicts they foresee in the future.

Shea, Healey and Kolenda indicated that they felt the spirit of the policy had been met. There were multiple public meetings on the issue. McCay informed the EDC of his request, it was discussed at one of their meetings, and no one from the EDC voiced opposition.

Selectman Sam Stivers stood alone (on the board) in opining that the EDC was inappropriate for the designation. Stivers argued that the EDC’s work advocating for the Downtown Initiative and pushing for the Planning Board to approve a mixed-use project downtown were examples of the committee’s power. 

Earlier in the meeting, McCay made his case for the logic behind granting the SME status to EDC. He said that to get the subject matter expertise needed for a committee to spur economic development means recruiting people with experience in economic development issues, development issues, municipal issues, and real estate issues. They are likely to have a connection to someone who does business in the Town at some point. He also pointed out that the EDC can’t grant permits on its own or spend money without Town approval.

In the end, the board voted 3-2 to approve the SME status for the EDC.

To see the final version of the adopted policy, click here. For a look at the draft of the forms that will be used for reporting conflicts (created by Healey and Town Clerk Jim Hegarty) click here.

*The Town has granted SME status to officials in the past. I don’t have a complete list on who is designated as an SME yet. The Town Administration is still working to compile one. An example that was given was the Council on Aging. Apparently, it was granted because members of the COA sometimes also work in the Town’s tax write-off program. Existing SMEs will now have to follow the process outlined for reporting conflicts to the Town. And selectmen will review the list of SMEs annually.

{ 1 comment… read it below or add one }

1 Pay Attention Taxpayers October 27, 2019 at 11:04 PM

The EDC can’t grant permits, as the article points out, but it is working on zoning and has no legal authority to do so. Like it or not, the EDC is working on zoning and likely plans to try to push their own vision through at Town Meeting. So the minimalizing of their role in arguments for SME status is a bit misleading as pointed out by one BOS member.

Also, at the end of this article above, under the paragraph discussing McCay’s reasoning, EDC recruits “are likely to have a connection to someone who does business in the Town at some point.”

Not at some point. Already. Past and present. Take a look at the Conflict of Interest forms and letters submitted to the BOS. These are public record. (Beth, can you insert a link above?) Some have stated that their firm does business with developers who appear regularly before boards in town. One states:
• has a long standing relationship with . . . .both in Southborough and other communities. My firm is leasing broker on many of their properties.”

When the Town’s best interest and this volunteer’s (or their firm or their partners business interests) interests collide, how will the “volunteer” act on a policy or on a vote? Is this a conflict? An appearance of conflict? Reader, you be the judge.

The critically important question is this: there is concern about any town volunteer acting for private clients interests versus the public’s / residents’ interests. What “volunteer” would act against their or their firm’s private client? In policies, votes, or advisory capacity? There is a need for balance and no conflicts of interest and certainly more transparency, not less. The new forms are alarming in the way they allow the filer to disclose the “nature” of the work and not the work itself. That’s illuminating! So much for transparency. Written by a BOS member who ran for office on a platform promising increased transparency. How’s that for irony?

Mr. McCay failed in trying to get the BOS to eliminate Paragraphs 10 and 11 regarding elimination of conflict disclosures on a local form and BOS annual review of SMEs. Ms. Braccio gave eloquent reasons for concerns, ironically followed by Mr. Kolenda barreling ahead and calling for a vote to install the policy. All of this with no discussion of possible downsides to the public interest. Special Municipal Employee status had to be given to EDC or else, as Mr. McCay complained, he would have to leave the committee. So what, you ask? Good question. There is no real need here, as the committee has plenty of volunteers to function as a committee.

No one, not the EDC, Mr. McCay, nor the BOS clarified any of the following:
1) Where in the EDC Minutes exactly is the Economic Development Committee vote authorizing Mr. McCay to act on behalf of the committee and request Special Municipal Employee designation?

2) In Mr. McCay’s request letter, he never outright states clearly what the problem is for him, i.e. what exactly has he / the committee been working on (e.g. Downtown Zoning Initiative?) that requires that designation or he must leave the committee?
He mentions that a private client is bringing forth a proposal that would present a conflict of interest, but he never states what the public town business is. What public town business specifically is causing the problem for him? Is it the Downtown Zoning Initiative? As public town business, it should be talked about publicly and the town voters are due an answer to these important questions.

3) The designation is not given to individuals. It is given to committees / boards. Why is the request letter on Mr. McCay’s letterhead?

4) Mr. McCay stated in his prior presentation to the BOS that the Ethics Commission favors use of this designation, while Mr. Stivers of the BOS stated that he called the attorney of the day at State Ethics and they unequivocally stated that they do not encourage use of the Special Municipal Employee designation.

The voters should be on high alert to the problems and downside of granting this designation. Now Advisory is chiming in, wanting to understand more. Why?Because at least two of the members have direct financial relationships with developers who appear before the Town boards and committees regularly.

Just one opinion, but again, the important question of the day is about private client interests (companies, private developers, etc) and personal financial interests of “volunteers” (or their partners or their firms) potentially overriding the best interest of the taxpayers and voters who interests can be easily ignored. The 3 to 2 vote on granting the SME status to the EDC is a strong message to the taxpayers, pay attention and be aware of anyone, especially attorneys, looking to make it easier for other attorneys and others with appearances of conflict or conflicts. The slick talk does not work and caution is the order of the day.

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