Request By:
Honorable William K. Sparks
Attorney at Law
Suite 709
310 West Liberty Street
Louisville, Kentucky 40202
Opinion
Opinion By: Steven L. Beshear, Attorney General; By: Walter C. Herdman, Assistant Deputy Attorney General
This is in answer to your letter of September 17 in which you seek an opinion concerning the following:
"I represent a client who is contemplating running for State Representative next year. He has had a personal service contract with the State for the past five years. My client's question is whether there would be any potential conflict of interest if he were elected Representative and continued to have a personal service contract. "
Under separate letter you enclose a personal service contract executed between your client and the Kentucky State Fair Board in which the Board contracted for your client's services as Admissions Control Specialist for the 1980 State Fair.
Pursuant to a telephone conversation several days ago you further indicated that your client is in fact the president of a security corporation located in Louisville and though the contracts is executed in his name only the compensation he receives for services rendered under the contract goes to the corporation of which he is president.
From the facts given, the controlling statute would be KRS 6.775(7) which reads as follows:
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"(7) No legislator shall knowingly himself or by his partners or through any corporation which he controls or in which he owns or controls more than five percent (5%) of the stock, or by any other person for his use or benefit or on his account, undertake, execute, hold or enjoy, in whole or in part, any contract, agreement, sale or purchase of the value of twenty-five dollars ($25.00) or more, made, entered into, awarded or granted by any state agency, unless said contract, agreement, sale or purchase was made or let after public notice and competitive bidding."
The above statute clearly prohibits a member of the legislature from executing or holding any contract awarded by any state agency where such legislator owns or controls more than five percent of the stock of the corporation and where the contract is of the value of twenty-five dollars or more unless said contract is let on a bid basis.
Under the circumstances and from the facts present, it would appear that your client is in fact contracting on behalf of the corporation of which he is president with an agency of the state. Also the contract would obviously exceed the statutory maximum value requiring it to be let on a bid basis which was not complied with by the contracting partner. Therefore, a conflict of interest would exist under the terms of the above referred to statute if and when your client assumes the office of state representative.