Conflict of Interest – City Officers – San Francisco Ethics Commission

Understanding Conflicts of Interest

A conflict of interest occurs when a public official’s personal financial interests have the potential to interfere with their duty to act in the public’s best interest. All City elected officials, commissioners, and employees are public officials, as are certain independent consultants working for the City.

Public officials must always prioritize the public’s best interests. To uphold this principle, public officials are prohibited from participating in decisions that could impact their own financial interests or those of their immediate family members.

What Constitutes a Personal Financial Interest?

If you are a public official, your personal financial interests include:

Business positions: Any business entity for which you are a director, officer, partner, trustee, employee, or holds any position of management.
Investments: Any business entity in which you have an investment of $2,000 or more.
Real property: Any real property in which you have an investment of $2,000 or more.
Sources of income: Any source of income of $500 or more in the last 12 months.
Sources of Gifts: Any source of a gift of $630 or more in the last 12 months.
Immediate family finances: Financial interests of a spouse or close relatives.

Although are not included within this prohibition, those relationships may require to prevent the appearance of bias or impropriety.

The following section provides an overview of the state and local laws that address conflicts of interest.

Overview of Conflict of Interest Laws

A public official has a financial interest in a government decision if it is reasonably foreseeable that the decision will have a financial effect on the official’s personal financial interests.
Material effect. In order for there to be a conflict of interest, the foreseeable effect on the official’s personal financial interest must be significant enough to be considered material. This will depend on the type of decision being made and the type of financial interest that could be affected.
Effects on the general public. Sometimes, a public official can participate in a government decision even if it might affect their personal financial interests, but only if that effect is indistinguishable from how the decision will affect a significant segment of the public.
Making, participating in, or influencing a decision. If an official has a financial interest in a government decision, they cannot make, participate in, or use their official position to influence that government decision.
- Making a government decision includes authorizing or directing any action, voting on a matter, making an appointment, entering into a contract, or otherwise obligating the City to a course of action.
- Participating in a government decision is when an official provides information, an opinion, or a recommendation for the purpose of affecting a government decision.
- Influencing a government decision is when an official contacts or appears before their own agency or an agency over which they have authority or budget control. It also includes when an official contacts any agency while acting, or purporting to act, within the scope of their official duties.
Conflicts of Interest in Government Contracting This is a separate rule from the general prohibition on conflicts of interest described above. In some situations, both rules may apply.
Financial Interest is Broadly Defined. A financial interest under 1090 includes any interest which would prevent the officials involved from exercising absolute loyalty and undivided allegiance to the best interest of the City.
Making a Contract Includes All Steps. Under 1090, making a contract can include planning, preliminary discussion, compromising, drawing or plans and specifications, and solicitations of bids that lead to the formal making of a contract.
There are exceptions to the broad definition of financial interest which apply when the interest is remote or the law specifies are not a financial interest.
Recusal May Not Be Enough. In order to comply with this rule, a public official may be required to choose between maintaining a private interest and remaining in public office. In other words, a potential conflict under this rule can’t always be remedied with a recusal.
Future Employment Restrictions
City officers or employees are prohibited from making, participating in, or attempting to influence any governmental decision that directly impacts a person or entity with whom they are discussing or negotiating an agreement for future employment.

Conflict of Interest Guidelines

How to proceed when you have a conflict of interest depends on your role with the City.

For Board Members and Commissioners

If you have a conflict of interest regarding an item before your board or commission, you must:

Publicly identify the circumstances requiring your recusal.
Abstain from participating in discussions or decisions on the item. This is called recusal.
Leave the room during discussions and decisions until the matter is concluded.

Remember that for conflicts of interest related to government contracts, it is not always enough to simply recuse yourself. You should always seek advice whenever you may have a conflict in connection with a City contract.

For all other City Officers and Employees (Including Consultants)

If you are not a board member or commissioner, you must abstain from discussing or participating in the decision in any way.

Additional Information

All of the rules discussed on this page are explained in greater detail in the City Attorney’s Good Government Guide. Part Two of the guide explains conflicts of interest
Submitted recusal notifications are available for the public’s review.

Applicable Laws

Get Advice

If you are unsure whether you may have a conflict of interest, you should seek advice from the Ethics Commission. You can easily submit an online advice request.