Florida Ethics Update: Commission on Ethics Determinations—January Meeting

Consideration of Settlement Agreements

Settlement of Ethics Complaint Filed Against the Former General Counsel of the Florida Virtual School  

During its public session meeting, the Commission approved a Settlement Agreement (referred to by the Commission as a “Joint Stipulation”) resolving an ethics complaint filed against the former General Counsel of Florida Virtual School (FVS), Frank Kruppenbacher.  

The ethics complaint alleged, and the Order to Investigate issued by the Commission sought investigation of, allegations that while employed as General Counsel Mr. Kruppenbacher used his position to require his employees to perform work and personal services for the benefit of himself, his family members, and his private businesses and clients; that he directed FLVS staff to analyze the salary of his daughter, who was also an FLVS employee and sought to ensure that a raise was afforded to her; that Mr. Kruppenbacher used his position to ensure that FLVS hired his daughter’s boyfriend (now husband) as an FLVS vendor despite his apparent lack of qualifications; that Mr. Kruppenbacher destroyed and/or otherwise created false or misleading public records in order to hide or conceal unsupported legal department expenditures; and further alleged that he failed to take annual leave during several multi-week trips for outside business activities and subsequently used those hours for his benefit via the encashment program.  

In a July 21, 2021, Order the Commission found Probable Cause to believe that Mr. Kruppenbacher misused his official position and information not available to members of the general public for his personal benefit and requested an administrative trial before the Division of Administrative Hearings (DOAH) regarding these findings.  

At last Friday’s meeting, the Commission voted to enter a final order approving a proposed settlement agreement of the matter finding that Ms. Kruppenbacher while employed as the General Counsel of FLVS misused his official position “by using his position to require his agency’s employees to perform work and personal services for the benefit of himself, his family members, and/or his private business and clients” and dismissed the remaining allegations. In light of this ethics violation, a total fine of $5,000 and public censure and reprimand was recommended by the Commission for imposition by the Governor. 

Settlement of Ethics Complaint Filed Against Noma Town Council Member  

The Commission also approved a Settlement Agreement of an ethics complaint filed against a current member of the Noma Town Council, Aneala Beachum.  

The ethics complaint alleged that after Ms. Beachum was appointed to the Town Council she began renting a house owned by the Town and owed the Town $4,000 in past due rent which constituted a conflicting employment and contractual relationship. The complaint further alleged that prior to renting the house, the member violated the voting conflict law when the Town Council voted to purchase an air conditioning unit and security system for the house.  

At its September 8, 2023, meeting the Commission found probable cause to believe Beachum violated the conflicting employment and contractual relationship provision of the Code of Ethics and ordered an administrative trial on this allegation.  

At its meeting last Friday, the Commission approved the Settlement Agreement finding that Beachum violated the Code of Ethics by having a conflicting relationship that would create a continuing or frequently recurring conflict between her private interests and the performance of her public duties when she rented a duplex owned by the City to operate her two private businesses out of the space.  In light of this ethics violation, the Commission recommended a total fine of $2,500 and public censure and reprimand for imposition by the Governor. 

Settlement of Ethics Complaint Filed Against the Chairman of the Board of Supervisors of the Coquina Water Control District Board 

The Commission also approved a Settlement Agreement filed against the Chairman of the Board of Supervisors of the Coquina Water Control District Board (Board), David Law.  

The ethics complaint and the Order to Investigate focused on allegations that Mr. Law violated the constitutional disproportionate benefit prohibition as well as the misuse of public position, anti-nepotism, and voting conflicts requirements of the Code of Ethics, when he made a motion and voted in favor of the District hiring his son as a temporary, part-time District employee. The complaint further alleged that ninety days after the vote, Mr. Law directed District staff to “make” his son a full time District employee, resulting in a promotion and raise for his son.  

At its December 1, 2023, meeting the Commission found Probable Cause to believe that Mr. Law had violated the constitution and the Code of Ethics as alleged in the complaint and order an administrative trial on these matters.  

At its meeting last Friday, the Commission approved the Settlement Agreement finding that Mr. Law failed to follow disclosure requirements after abstaining on an April 2023 vote, violated the anti-nepotism law when he advocated for his son to be hired by the District, and that he violated the constitutional amendment prohibiting abuse of office for a disproportionate benefit, and misused his position for the benefit of his son. In light of these ethics violations, the Commission recommended a total fine of $4,250 and public censure and reprimand for imposition by the Governor.

Consideration of Advisory Opinion Requests

The Code of Ethics provides that any public officer, public employee, and certain others who are in doubt regarding the application of the Code of Ethics or Sunshine Amendment may request an Advisory Opinion from the Commission. 

Consideration of Advisory Opinion Requested by Independent Special District Board Members Voting on Converting the District to a Nonprofit Entity  

The Commission also approved the adoption of draft advisory opinion (File No. 2808) advising members of the Lee Memorial Health System Board of Directors that they would be permitted to vote on measures to convert the Independent Special District to a nonprofit entity, despite an apparent voting conflict, due to the application of specific legislation expressly permitting the members of an Independent Special District Board to undertake such a vote, even when they intend to serve the nonprofit entity as compensated board members following the conversion. The opinion advised that while Board members must still comply with the other requirements of the voting conflict law, by orally stating the conflict and filing a Form 8B within 15 days of the vote, the members would be permitted to vote on the measure. 

Additional guidance was provided on whether participating in the vote would constitute a disproportionate benefit prohibited by Article II, Section 8(h)(2) of the Florida Constitution.  

Consideration of Advisory Opinion Requested by a Jacksonville City Council Member Regarding Conflicts of Interest and the Application of the Sole Source of Supply Exemption  

The Commission approved the adoption of draft advisory opinion (File No. 2809) which requested by the Director of the Jacksonville Office of Ethics, Compliance, and Oversight on behalf of a Jacksonville City Councilman. In the opinion the Commission advised the member that he would not have a conflicting employment or contractual relationship were his company to provide sports lighting installation services to the City, under his personal professional license, due to the application of the “sole source of supply” exemption to negate the apparent conflict. In the opinion, the Commission reasoned that the sole source exemption applied because the member’s company was the only qualified provider of these services within the City.  

However, the Commission further cautioned the member that he would have a voting conflict, requiring abstention regarding any votes on sports lighting projects before the City Council. Thus, he had to be cognizant of, and comply with, all requirements of the voting conflicts law regarding such measures. 

Deferral of Advisory Opinion Concerning the Disclosure of Trusts in The Absence Of Knowledge Of The Trust’s Holdings to March Meeting  

During the Commission’s meeting the Board voted to table the consideration of draft advisory opinion (File No. 2811) until its March 8, 2024, meeting to allow for the inclusion of an additional question.  

Consideration of Amendments to Commission’s Financial Disclosure Rule Chapter 34-8, Florida Administrative Code  

The Commission also considered and had a spirited discussion regarding proposed amendments to Commission Rule Ch. 34-8 of the Florida Administrative Code (F.A.C.) which govern disclosure of financial interests. The discussion at the meeting centered on proposed amendments to Rule 34-8.005 regarding the requirements of disclosure concerning the CE Form 6, “Full and Public Disclosure of Financial Interests” pertaining to the Secondary Sources of Income portion of the filing. Currently the Rule, and related instructions, require filers to identify each source of income (including clients and customers) that contributed more than ten percent of the gross income of businesses that they own.  

The proposed Rule amendment seeks to include a new subsection—subsection 5—wherein attorney filers would need only disclose “Legal Client” in satisfaction of the secondary sources of income disclosure section without providing any further identifying information. 

The Commission’s Deputy General Counsel explained that the proposed rulemaking arose in response to statements made by a member at the last meeting expressing concerns regarding the Florida Bar’s confidentiality requirements which prohibit attorneys from disclosing information related to the representation of a client.  

During the public comment portion of the discussion attorney and former Commission member, Mark Herron, expressed concerns regarding this proposed amendment stating that it would effectively “put a shade over” the filer’s secondary sources of income and as such “the public is going to be denied access to information.”  

Commissioner Wengay Newton echoed these concerns from the bench and stated that “It looks a lot like legislating from the bench.” He further opined that “The people of the State of Florida want to know about where [public official’s] finances are coming from.” He further expressed concerns that the proposed amendment would effectively conceal from revelation to the public information relevant to conflicts going forward.  

In light of this discussion, the Commission voted to table the consideration of these Rule amendments until its March 8, 2024, meeting wherein alternative amendment language will be able to be considered.

 
Discussion of Legislative Report  

The Commission discussed several proposed bills having ethics impact identified in its Legislative Report that had arisen during the Regular Legislative Session which commenced on January 9, 2024.  

The Executive Director explained that staff has been working with Legislators to “tweak” language currently contained in House Bill 1597 and its companion Senate Bill 7014 which seeks, in part to implement time frames for the resolution of ethics complaint proceedings. However, she noted that Commission Chair Ashley Lukis had expressed in committee testimony concerns regarding portions of the bill that seek to require a super-majority of six commissioners to deviate from the written recommendation of the Commission’s counsel. At the meeting, Commissioner Tina Descovich stated “I am shocked that the Legislature wants to take this authority away from the Commission.” The Commission voted to draft a letter to provide to Legislative committees and others opposing the six member vote requirement language.  

The Executive Director also highlighted the potential impact of House Bill 735 and the companion Senate Bill 734 which seeks to adopt s. 112.3262, F.S., within the Code of Ethics to prohibit people from lobbying a county, municipality, or special district without first registering as lobbyist and establishes requirements for registration, compliance, investigations, and registration fees. Executive Director, Kerrie Stillman, stated that, if passed, this legislation would result in the imposition of this registration requirement upon 2,500 local government entities. She further noted that the language of Senate Bill 734 requires the use of an electronic system for such registrations and provides that if a locality does not possess such an electronic system that the State Lobbyist Registration and Compensation Reporting System, currently used for the registration and compensation reporting of State lobbyists seeking to lobby the Legislature or Executive Branch agencies. She cautioned that the system was not designed for expansion and the system would have to be entirely redesigned prior to the July 1 effective date. She cautioned that this would lead to both funding and logistical issues for the Commission.