STATE OF MICHIGAN

FRANK J. KELLEY, ATTORNEY GENERAL

Opinion No. 6134

March 17, 1983

INCOMPATIBILITY:

Offices of member of Board of Trustees of Michigan State University and Director of Office of State Employer

The offices of member of Board of Trustees of Michigan State University and Director of the Office of State Employer are incompatible and may not be simultaneously occupied.

Mr. John B. Bruff

Director

Office of the State Employer

Lewis Cass Building

Lansing, Michigan

As a member of the Board of Trustees of Michigan State University and Director of the Office of State Employer, you have requested my opinion on the question whether those two offices are compatible or incompatible under Michigan law.

Two acts passed in the last ten years bear directly on your question. As stated in their respective titles, they are:

and

Section 2 of 1978 PA 566, supra, provides:

Incompatible office are defined in 1978 PA 566, supra, Sec. 1(b), as follows:

The first two statutory standards of incompatibility restate the common law. OAG, 1979-1980, No 5626, p 537, 541-542 (January 16, 1980). The third standard of incompatibility changed the common law by providing that incompatibility occurs when a breach of duty results from performance of other duties. The common law had, instead, based incompatibility on the nature of each public position ⁽¹⁾ and the potential for conflict which was inherent in the duties and responsibilities of each position.

As previous opinions have concluded, abstaining from a matter does not prevent incompatibility from arising under 1976 PA 566, Sec. 1(b)(iii), supra, because abstention to avoid incompatibility would constitute a breach of duty. OAG, 1979-1980, No 5626, supra at 544-545. See also, OAG, 1979-1980, No 5835, p 1131 (December 30, 1980); and OAG, 1981-1982, No 5955, p 311 (August 12, 1981).

1978 PA 566, supra, Sec. 3, is specifically concerned with membership on a governing board of a university. It provides:

Thus, while subsection (1) may appear to remove the matter from the scope of 1978 PA 566, Sec. 2, supra, subsection (5) does not 'allow or sanction specific actions . . . which would result in a breach of duty.' Furthermore, subsection (4) does not 'allow or sanction activity constituting a conflict of interest prohibited by the . . . laws of this state.' ⁽²⁾

The second public act which bears upon your question is 1973 PA 196, supra. It must be considered in view of the proscription in 1978 PA 566, Sec. 3(4), supra, prohibiting activity which violates other Michigan law. In defining prohibited conflicts of interest, 1973 PA 196, supra, Sec. 2(6), as amended, provides:

The Director of the Office of State Employer is a 'public officer' under 1973 PA 196, supra, Sec. 1(c); thus, section 2(6) is applicable to your question.

The Board of Ethics was created by 1973 PA 196, supra. Section 5(e) of that Act provides that 'the board shall . . . issue and publish advisory opinions . . .' concerning ethical conduct of public officers. That Board has said that no actual impairment of independence of judgment or action is required by 1973 PA 196, Sec. 2(6), supra. In re Zink, 79-EA-17, p 6. Thus, the standard of 1973 PA 196, Sec. 2(6), supra is comparable to the common law standard. Under the common law, positions were considered incompatible even though the conflict of duties may arise only on rare occasions. It is the existence of conflicting powers, not the remoteness of their exercise, which is controlling. Northway v Sheridan, 111 Mich 18; 69 NW 82 (1896); Attorney General, ex rel Moreland v Common Council of City of Detroit, 112 Mich 145, 172-173; 70 NW 450 (1897); and Weza v Auditor General, 297 Mich 686, 689; 298 NW 368 (1941).

With this background, we must analyze the two offices you now hold--member of the Board of Trustees of Michigan State University and Director of the Office of State Employer--in order to determine whether they are compatible.

Const 1963, art 8, Sec. 5 provides, in relevant part:

Furthermore, Const 1963, art 8, Sec. 4 requires the Legislature to appropriate money to maintain Michigan State University.

The statutory powers and duties of the Board of Trustees are more specifically enumerated in 1909 PA 269, as amended; MCLA 390.101 et seq; MSA 15.1121 et seq. Although the authority of the Board of Trustees within the educational sphere is constitutional in nature, it may, nevertheless, be affected by the police power of the State. See, Branum v Board of Regents of University of Michigan, 5 Mich App 134; 145 NW2d 860 (1966), app dism per stip 379 Mich 753 (1967).

Turning to the powers and duties of the office of Director of the Office of State Employer, under Const 1963, art 11, Sec. 5, rates of compensation and conditions of employment are set by the Civil Service Commission. Classified state civil service employees have no right to collective bargaining. Welfare Employees Union v Civil Service Commission, 28 Mich App 343; 184 NW2d 247 (1970), lv den 384 Mich 824 (1971). The Commission adopted a 'Civil Service Employee Relations Policy and Regulations of 1976,' which was basically a 'meet and confer policy' (Minutes 8-20-76, p 8). Under that policy the Governor or his designated representative was cast in the role of State Employer, and the Governor initially designated the Director of Management and Budget as the State Employer.

Effective December 22, 1978, the people amended Const 1963, art 11, Sec. 5, to give State Police troopers and sergents the right to bargain collectively. By Executive Order 1979-5, the Governor created the Office of State Employer within the Department of Management and Budget. The Executive Order provides that the Director is the officer who heads that agency. Section 3 of that Order provides:

As amended by Executive Order 1981-3, Section 5 of Executive Order 1979-5 states:

On December 17, 1979, the Civil Service Commission voted to extend collective bargaining to other classified state civil service employees in addition to state police troopers and sergeants. (Minutes 12-17-79, pp 5-8). The Commission, on April 25, 1980, adopted a new employee relations policy which established procedures for collective bargaining and established the employment relations board (Minutes 4-25-80, p 17). Thereafter, on August 27, 1980, the Commission adopted procedures for the employment relations board (Minutes 8-27-80, p 17). On December 18, 1981, the employee relations policy, was converted to rule status (Minutes 12-18-81, pp 11-27).

Under the employee relations policy, conditions of employment and rates of compensation are fixed by the Commission: (1) by review of collective bargaining agreements; (2) by review of impasse panel recommendations; and/or (3) by review of the recommendations for a coordinated compensation plan covering excluded and nonexclusively represented classified state civil service employees. It should be stressed that the Office of State Employer participates in all of these proceedings as the representative of the state, all of its agencies, boards and commissions that makeup the executive branch of state government.

The net result is that the Director of the Office of State Employer plays a significant role in determining the compensation and working conditions of all employees in the classified state civil service.

Employees in the classified state civil service perform, inter alia, numerous, significant duties which impact directly on Michigan's colleges and universities. Classified state civil service employees carrying out the legislative mandate set forth in the Michigan Occupational Safety and Health Act, 1974 PA 154, as amended; MCLA 408.1001 et seq; MSA 17.50(1) et seq; the Worker's Disability Compensation Act, 1969 PA 317, as amended; MCLA 418.101 et seq; MSA 17.237(101) et seq; the Michigan Election Law, 1954 PA 116, as amended; MCLA 168.1 et seq; MSA 6.1001 et seq; the Elliott-Larson Civil Rights Act, 1976 PA 453, as amended; MCLA 37.2101 et seq; MSA 3.548(101) et seq; and Michigan's public employment relations act (PERA), 1947 PA 336, as amended; MCLA 423.201 et seq; MSA 17.455(1) et seq, affect matters which directly concern the Board of Trustees of Michigan State University in discharging its responsibilities.

For example, the authority of the Board of Trustees to fix compensation of its employees is restricted by the right of collective bargaining under PERA. In this connection, it is to be noted that the processes for union recognition, collective bargaining and mediation with respect to Michigan State University personnel are carried out by classified state civil service employees pursuant to PERA.

Another example of the interaction of classified state civil service employees serving in state agencies and the University is found in the processing of the current application of the University filed pursuant to the Hazardous Waste Management Act, 1979 PA 64, as amended; MCLA 299.501 et seq; MSA 13.30(1) et seq, for approval to construct a hazardous waste disposal facility. The site approval board which must review the University's application will include representatives of the Directors of the Departments of Public Health, State Police and Natural Resources. 1979 PA 64, supra, Sec. 17. Such representatives include classified state civil service employees. Furthermore, classified state civil service employees in the air quality, surface water quality, groundwater quality, and hazardous waste divisions of the Department of Natural Resources must execute written reviews of the University's plans. 1979 PA 64, supra, Sec. 19(c).

The University's application will also be reviewed by the Michigan Environmental Review Board (MERB) pursuant to Executive Order 1974-4. MERB includes, as voting members, representatives of the Department of Management and Budget, the Department of Agriculture, the Department of Public Health, the Department of Commerce, the Department of Transportation, the Department of Attorney General, and the Department of Natural Resources. A review of the minutes of recent MERB meetings discloses that the majority of the agency representatives present are classified state civil service employees.

The State Board of Ethics had occasion to pass upon an analogous situation in In re Shillinglaw, 76-EA-8, which involved a professor and chairperson of the Department of Osteopathic Medicine at Michigan State University who was simultaneously serving as Executive Secretary to the Board of Osteopathic Registration and Examination, the predecessor of the present Board. It found a conflict of interest in violation of 1973 PA 296, Sec. 2(6), supra, in the event that the two positions were held simultaneously. For its conclusion, the Board of Ethics relied upon the possible impairment of independence of judgment or action in the performance of the official duties as Executive Secretary, on the one hand, and professor and chairperson of the department of the university, on the other.

To sum up, classified state civil service employees routinely exercise authority over matters which impact the operation of the University, matters which often have been considered and acted upon by the Board of Trustees of the University. One of the responsibilities of the Director of the Office of State Employer is to engage in negotiations regarding compensation and other conditions of employment of classified state civil service employees. Therefore, as the concurrent occupant of the office of member of the Board of Trustees and Director of the Office of State Employer, you would be confronted with the possibility of making decisions which may conflict with the best interest of one of those responsibilities to the correlative disadvantage of the other responsibility. The public is entitled to the judgment of each of these offices, free from any possible impairment of independent judgment resulting from dual officeholding.

I am convinced that if you were to hold both offices you would make every effort to remain objective in your role as Director of the Office of State Employer. Nevertheless, I am constrained to conclude and it is my opinion that within the meaning of 1973 PA 196, Sec. 2(6), supra, your interrelationship with classified state civil service employees in your office as Director of the Office of State Employer while you simultaneously serve as a member of the Board of Trustees of Michigan State University has the potential for impairment of independence of judgment or action. See, In re Zink, 79-EA-17, and In re Shillinglaw, 76-EA-8. See also, Letter Opinion of the Attorney General to David D. Diehl dated August 3, 1970, which holds that a member of the Board of Trustees of Michigan State University may not become a member of the Michigan Commission of Agriculture.

The simultaneous occupation of these offices involves the potential for the impairment of independence of judgment or action. It is, therefore, a violation of 1973 PA 196, Sec. 2(6), supra.

While it is not essential to the opinion, it must be observed that Michigan State University and the departments within the executive branch of state government with classified state civil service employees receive appropriations from the Legislature.

In previous opinions it has been recognized that where two public bodies may be competing for the same tax revenues, one person may not be a member of both governing bodies. See, 2 OAG, 1955-1956, No 2675, p 405 (July 16, 1956); 2 OAG, 1957-1958, No 3218, p 128 (May 14, 1958); OAG, 1963-1964, No 4307, p 420 (June 30, 1964); and OAG, 1969-1970, No 4671, p 51 (May 14, 1969). Admittedly, said opinions are based upon the common law, and under 1978 PA 566, Sec. 1(b)(iii), supra, an actual conflict is proscribed. OAG, 1979-1980, No 5626, supra.

It should be noted that during the past year as a result of four Executive Orders cutting the State's budget, layoff days and postponement of compensation increases were sought by the former Director of the Office of State Employer. The need to seek further financial concessions from classified state civil service employees remains a possibility. In his State of the State Address, Governor Blanchard detailed the effects of Michigan's fiscal crisis:

It is my opinion, therefore, that the offices of member of the Board of Trustees of Michigan State University and Director of the Office of State Employer are incompatible and may not be simultaneously occupied.

Frank J. Kelley

Attorney General