# COMAR Title 19A — State Ethics Commission

## Subtitle 02 — Conflicts of Interest

### Chapter 01 — Exception to Outside Employment Prohibition

**Authority:** General Provisions Article, §§5-206 and 5-502, Annotated Code of Maryland

**Administrative History:** Effective date: August 2, 1982 (9:15 Md. R. 1517)

**Administrative History:** Regulation .01 amended effective January 13, 1986 (13:1 Md. R. 19); October 15, 2012 (39:20 Md. R. 1308)

**Administrative History:** Regulation .02 amended effective October 15, 2012 (39:20 Md. R. 1308)

**Administrative History:** Regulation .03 amended effective December 20, 1982 (9:25 Md. R. 2486); October 15, 2012 (39:20 Md. R. 1308)

**Administrative History:** Regulation .04 adopted effective December 20, 1982 (9:25 Md. R. 2486)

**Administrative History:** Regulation .04 amended effective November 5, 1984 (11:22 Md. R. 1900); January 13, 1986 (13:1 Md. R. 19); October 15, 2012 (39:20 Md. R. 1308)

#### Regulation .01 Scope.

*COMAR 19A.02.01.01*

A. Except as provided in §B of this regulation, this chapter applies to all officials and employees.

B. This chapter does not apply to a member of the General Assembly or a State official in the Judicial Branch.

#### Regulation .02 Prohibition Against Outside Employment.

*COMAR 19A.02.01.02*

Except as provided in Regulation .03 of this chapter, an official or employee may not:

A. Be employed by an entity subject to the authority of:

  (1) The official or employee; or

  (2) The governmental unit with which the official or employee is affiliated;

B. Be employed by an entity which is negotiating or has entered a contract with the governmental unit with which the official or employee is affiliated; or

C. Hold any other employment relationship that would impair the impartiality or independence of judgment of the official or employee.

#### Regulation .03 Exceptions.

*COMAR 19A.02.01.03*

Subject to Regulation .04 of this chapter, the Commission may grant an official or employee an exception to Regulation .02 of this chapter for specific outside employment if:

A. The employee's or official's State duties do not significantly impact on the outside employer or a contract or proposed contract between the outside employer and the official’s or employee’s governmental unit;

B. The employee or official is not directly supervised by a person who has duties that significantly impact on the outside employer or the contract or proposed contract;

C. The official or employee does not supervise a person who has duties that significantly impact on the outside employer or the contract or proposed contract;

D. The employee or official is not affiliated with the specific unit within the employee’s or official’s governmental unit that exercises authority over the outside employer or is involved in contracts with the outside employer;

E. The employee or official has complied with relevant other sections of the Ethics Law relating to the matters involved;

F. The employee's or official's outside employment involves no substantive, non-ministerial duties significantly relating to the official’s or employee’s governmental unit’s authority over the outside employer;

G. The employee's or official's outside employment does not involve negotiating or carrying out a contract involving the outside employer and the official’s or employee’s governmental unit, other than contracts involving broad reimbursement payments that are based on a generally applicable standard and that do not involve substantial negotiation or discretion;

H. The employee's or official's private compensation is not directly funded by the State contract or contracts; and

I. The Commission determines that the employee's or official's specific employment circumstances do not otherwise raise a conflict of interest or appearance of conflict as contemplated by General Provisions Article, §§5-102 and 5-502, Annotated Code of Maryland.

#### Regulation .04 Application of Exceptions.

*COMAR 19A.02.01.04*

A. The Commission may grant an exception under Regulation .03 of this chapter to an individual who does not meet the criteria of Regulation .03B, C, D, or F of this chapter for specific outside employment if:

  (1) The head of the employee’s or official’s governmental unit advises the Commission that the head of the governmental unit does not believe that the secondary employment would present a conflict of interest or the appearance of a conflict of interest that would impair the credibility of the governmental unit; and

  (2) The Commission concurs in the assessment of the head of the official’s or employee’s governmental unit provided under §A(1) of this regulation.

B. The Commission may grant an exception under Regulation .03 of this chapter to an individual who does not meet the criteria of Regulation .03H of this chapter if:

  (1) The official’s or employee’s private compensation is funded by contracts involving broad reimbursement payments that are based on a generally applicable standard and that do not involve substantial agency negotiation or discretion;

  (2) The head of the official’s or employee’s agency advises the Commission that the head of the agency does not believe that the secondary employment would present a conflict of interest or the appearance of a conflict of interest that would impair the credibility of the agency; and

  (3) The Commission concurs in the assessment of the head of the official’s or employee’s agency provided under §B(2) of this regulation.

C. The Commission may grant an exception under Regulation .03 of this chapter to an employee who does not meet the criteria of Regulation .03F, G, or H of this chapter if:

  (1) The employee has limited duties that are defined with sufficient precision regarding time, mode, and occasion that the employee may not exercise substantial discretion or judgment;

  (2) The head of the employee’s governmental unit advises the Commission that the head of the governmental unit:

    (a) Believes that the service or product to be supplied by the employee would be otherwise unavailable to the State; and

    (b) Does not believe that the secondary employment would present a conflict of interest or the appearance of a conflict that would impair the credibility of the agency; and

  (3) The Commission concurs in the assessment of the head of the employee’s governmental unit provided under §C(2) of this regulation.

### Chapter 02 — Exception to Financial Interest Prohibition

**Authority:** General Provisions Article, §§5-206 and 5-502, Annotated Code of Maryland

**Administrative History:** Effective date: January 31, 1983 (10:2 Md. R. 111)

**Administrative History:** Regulation .01 amended effective January 13, 1986 (13:1 Md. R. 19); October 15, 2012 (39:20 Md. R. 1308)

**Administrative History:** Regulation .02 amended effective October 15, 2012 (39:20 Md. R. 1308)

**Administrative History:** Regulation .03 amended effective October 15, 2012 (39:20 Md. R. 1308)

**Administrative History:** Regulation .04 amended effective January 13, 1986 (13:1 Md. R. 19); October 15, 2012 (39:20 Md. R. 1308)

**Administrative History:** Regulation .05 amended effective October 15, 2012 (39:20 Md. R. 1308)

#### Regulation .01 Scope.

*COMAR 19A.02.02.01*

A. Except as provided in §B of this regulation, this chapter applies to all officials and employees.

B. This chapter does not apply to a member of the General Assembly or a State official in the Judicial Branch.

#### Regulation .02 Prohibition Against Holding of Private Financial Interests.

*COMAR 19A.02.02.02*

Except as provided in Regulation .03 of this chapter, an official or employee may not hold a financial interest in an entity that:

A. Is subject to the authority of:

  (1) The official or employee; or

  (2) The government unit with which the official or employee is affiliated; or

B. Is negotiating or has entered a contract with the governmental unit with which the official or employee is affiliated.

#### Regulation .03 Exceptions.

*COMAR 19A.02.02.03*

Subject to Regulation .04 of this chapter, the Commission may grant an official or employee an exception to Regulation .02 of this chapter for a specific financial interest if:

A. The interest is disclosed as provided in Regulation .05 of this chapter;

B. The employee’s or official's State duties do not significantly impact on the entity in which the financial interest is held, or on a contract or proposed contract between the entity and the official’s or employee’s governmental unit;

C. The employee or official is not directly supervised by a person who has duties that significantly impact on the entity in which the financial interest is held, or on the contract or proposed contract;

D. The official or employee does not supervise a person who has duties that significantly impact on the entity in which the financial interest is held, or on the contract or proposed contract;

E. The employee or official is not affiliated with the specific unit within the employee’s or official’s governmental unit that exercises authority over the entity in which the financial interest is held, or is involved in contracts with the entity;

F. The employee or official has complied with relevant other sections of the Ethics Law relating to the matters involved;

G. The employee’s or official's financial interest in the entity involves no substantive non-ministerial duties significantly relating to the employee’s or official’s governmental unit’s authority over the entity;

H. The employee’s or official's financial interest in the entity does not involve negotiating or carrying out a contract involving the entity and the employee’s or official’s governmental unit, other than contracts involving broad reimbursement payments that are based on a generally applicable standard and that do not involve substantial negotiation or discretion;

I. State contract or contracts do not exceed 20 percent of the calendar year gross income of the entity in which the financial interest is held, one-third of the capitalized value of the entity, or a value at any time during a calendar year of $5,000 or more; and

J. The Commission determines that the employee’s or official's financial interest and the circumstances do not otherwise raise a conflict of interest or appearance of conflict as contemplated by General Provisions Article, §§5-102 and 5-502, Annotated Code of Maryland.

#### Regulation .04 Application of Exceptions.

*COMAR 19A.02.02.04*

A. Exceptions Under Limited Circumstances.

  (1) The Commission may grant an exception under Regulation .03 of this chapter to an individual who does not meet the criteria of Regulation .03C, D, E, G, or I of this chapter for a specific financial interest if:

    (a) The head of the official’s or employee’s governmental unit advises the Commission that the head of the governmental unit does not believe that the financial interest would present a conflict of interest or the appearance of a conflict of interest that would impair the credibility of the governmental unit; and

    (b) The Commission concurs in the assessment of the head of the official’s or employee’s governmental unit provided under §A(1)(a) of this regulation.

  (2) The Commission may grant an exception under Regulation .03 of this chapter to an individual who does not meet the criteria of Regulation .03A(1) of this chapter for a specific financial interest in an entity if:

    (a) The employee or official did not know or have reason to know that the entity is under the authority of the employee or official or of the employee’s or official’s governmental unit;

    (b) The employee or official did not know or have reason to know that the entity has or is negotiating a contract with the employee’s or official’s governmental unit;

    (c) The entity is not included on any list of entities doing business with the employee’s or official’s governmental unit that is provided by the Commission or is available through the Commission’s website; and

    (d) Upon obtaining knowledge of the relationship between the entity and the employee’s or official’s governmental unit, the employee disclosed the financial interest as provided in Regulation .05 of this chapter.

B. The Commission may grant an exception under Regulation .03 of this chapter to an employee who does not meet the criteria of Regulation .03G or H of this chapter for a specific financial interest if:

  (1) The employee has limited duties that are defined with sufficient precision regarding time, mode, and occasion that the employee may not exercise substantial discretion or judgment;

  (2) The head of the employee’s governmental unit advises the Commission that the head of the agency:

    (a) Believes that the service or product to be supplied by the employee would otherwise be unavailable to the State; and

    (b) Does not believe that the financial interest would present a conflict of interest or the appearance of a conflict that would impair the credibility of the governmental unit; and

  (3) The Commission concurs in the assessment of the head of the employee’s governmental unit provided under §B(2) of this regulation.

#### Regulation .05 Disclosure Requirements.

*COMAR 19A.02.02.05*

A. An employee or official shall disclose a financial interest prohibited under Regulation .02 of this chapter:

  (1) For an official or employee required to file a financial disclosure statement under General Provisions Article, §5-601, Annotated Code of Maryland, on the financial disclosure statement for the reporting period in which the official or employee held the financial interest;

  (2) If the official or employee knows or has reason to know that the entity is subject to the authority of the official or employee, subject to the authority of the official’s or employee’s governmental unity, or is negotiating or has entered a contract with the official’s or employee’s governmental unit, on the form provided by the Ethics Commission for an official or employee who:

    (a) Is not required to file a financial disclosure statement under General Provisions Article, §5-601, Annotated Code of Maryland; or

    (b) Did not hold the financial interest during the reporting period covered by the most recent financial disclosure statement filed under General Provisions Article, §5-601, Annotated Code of Maryland.

B. An official or employee shall file a form required by §A(2) of this regulation with the Commission on or before the latter of:

  (1) Acquiring the financial interest; or

  (2) Acquiring knowledge that or reason to have knowledge that the entity:

    (a) Is subject to the authority of the official or employee or the government unit with which the official or employee is affiliated; or

    (b) Is negotiating or has entered a contract with the governmental unit with which the official or employee is affiliated.

C. An official or employee has reason to know that an entity does business with the official’s or employee’s governmental unit if the entity is listed as doing business with the official’s or employee’s governmental unit that is provided by the Commission or is available on the Commission’s website.

### Chapter 03 — Exception to Participation Restriction

**Authority:** General Provisions Article, §§5-206 and 5-501, Annotated Code of Maryland

**Administrative History:** Effective date: October 15, 2012 (39:20 Md. R. 1308)

#### Regulation .01 General.

*COMAR 19A.02.03.01*

The Commission may grant an official or employee an exception to the participation restrictions of General Provisions Article, §5-501, Annotated Code of Maryland, related to a business entity with which a qualifying relative is affiliated if:

A. The official’s or employee’s agency or appointing authority supports the exception; and

B. The Commission finds that, based on the overall circumstances and relationships, granting an exception is not contrary to the purposes of the Public Ethics Law.

#### Regulation .02 Factors to Be Considered.

*COMAR 19A.02.03.02*

In determining whether to grant an exception under Regulation .01 of this chapter, the Commission shall consider:

A. The nature of the qualifying relative’s relationship with the business entity;

B. The nature of the relationship between the official or employee and the qualifying relative;

C. The geographical distance between the official or employee and the qualifying relative;

D. Any prior issues related to the official’s or employee’s participation in the matter;

E. Agency controls and safeguards;

F. Any involvement by the qualifying relative in the matter involving the official or employee; and

G. The nature of the official’s or employee’s participation in the matter in relation to the official’s or employee’s overall duties.