Request By:
Mr. Ray Hammers
Superintendent
Simpson County Board of Education
P.O. Box 467
Franklin, Kentucky 42134
Opinion
Opinion By: Robert F. Stephens, Attorney General; By: Robert L. Chenoweth, Assistant Attorney General
As Superintendent of the Simpson County Board of Education you have asked the Office of the Attorney General to advise you regarding a matter concerning the sale of surplus school property. You stated the board of education was in the process of selecting a realtor to sell this surplus property. You desire answers to the following three questions:
1. One of our Board members is a salesman for a local realtor who is interested in handling the sale of our surplus buildings. May his firm be considered and may he vote on the bid submitted by his firm?
2. The Chairman's wife is a salesperson for a local realtor who is interested in handling the sale of our surplus buildings. May her firm submit a bid, and may he vote on the bid submitted by his wife's firm?
3. We plan to sell these buildings at public auction. May a board member or a member of his family bid and purchase the building or any part of the contents, such as student desks, etc.?
The applicable section of our school law is KRS 160.180(1)(f), (2), which reads as follows:
"(1) No person shall be eligible to membership on a board of education:
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(f) Who, at the time of his election, is directly or indirectly interested in the sale to the board of books, stationery or any other property, materials, supplies, equipment or services for which school funds are expended;
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(2) If, after the election of any member of the board, he becomes interested in any contract with or claims against the board, of the kind mentioned in paragraph (f) of subsection (1) of this section, or becomes a candidate for nomination or election to any office or agency the holding and the discharging of the duties of which would have rendered him ineligible before election, or if he moves his residence from the district for which he was chosen, or if he does anything that would render him ineligible for re-election, he shall be subject to removal from office pursuant to KRS 415.050 and 415.160."
The key to whether action of a school board member would be in violation of the above provisions is whether the school board member has an interest, directly or indirectly, in a claim or contract for which school monies are expended. That is, the board member must have a pecuniary interest, no matter how small. See Commonwealth ex rel Vincent v. Withers, 266 Ky. 29, 98 S.W.2d 24 (1936). Thus, if the board member will or is closely associated with one who will receive school money in payment for services, materials, etc., sold to the school system, the provisions of KRS 160.180 discussed above will be violated and the board member subject to removal from membership as a board member by this office. See generally OAG 77-519, copy attached.
Looking at your first and second questions, we believe, in view of the above, it should be evident that neither realtor firm may be considered. The realtor will be receiving a commission or some sum of money for services performed. This payment would be school money, even if part or all of the money received was from gross receipts of the sale of the property. This conclusion holds as to the wife of a board member due to the direct or indirect provisions. See, for example, OAG 62-712.
As to your third question, we see no problem here. There would be no expenditure of school funds received by the board member or his family. Again, the statute prohibits a board member from being interested in a sale "to the board" for something "for which school funds are expended. " KRS 160.180. The board member would stand no differently at a public auction than anyone else.