The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us) STATE OF MICHIGAN
FRANK J. KELLEY, ATTORNEY GENERAL
INCOMPATIBILITY:
County controller simultaneously serving as officer of nonprofit corporation established to maintain natural areas
The incompatible public offices act does not prohibit a county controller from simultaneously serving as an officer of a nonprofit corporation established to assist in the maintenance of a county-owned natural area.
Opinion No. 6993
August 21, 1998
Honorable David Anthony
State Representative
The Capitol
Lansing, MI
You have asked whether the incompatible public offices act prohibits a county controller from simultaneously serving as an officer of a nonprofit corporation established to assist in the maintenance of a county-owned natural area.
The nonprofit corporation involved in your question maintains a natural area consisting of real property owned by the county. The corporation's articles of incorporation provide that the county board of commissioners shall serve as ex officio members of the nonprofit corporation. Further, the corporation's bylaws provide that these ex officio members shall appoint seven "conservation-minded" persons to serve on the corporation's board of directors. The board of directors, in turn, elect the officers of the corporation. One of the seven corporate board members is a county employee who also simultaneously serves as the county controller and as an officer of the nonprofit corporation.
With the exception of the corporation's articles of incorporation and the bylaws, there are no written agreements or other documents evidencing the relationship between the county and the nonprofit corporation concerning the maintenance of the county's natural area. The corporation's articles recite that the purposes of the nonprofit corporation include the following:
Maintaining the Area in a good and reasonable condition . . . .
Establishing and charging fees, if any, for [using the Area] . . . .
Developing and establishing rules . . . for use of the Area . . . .
Providing guidance to County personnel, including the Parks Manager through the County Controller, with respect to the control and management of the day-to-day operations of the Area.
With respect to these stated corporate purposes, the corporation engages in safety-related repairs, trash removal and restroom maintenance at the natural area. No fees have been established or charged by the corporation for use of the natural area. Although the corporation proposes rules and regulations, it is the responsibility of the county board of commissioners to adopt, reject or amend all proposed rules and regulations. The corporation advises the county by suggesting maintenance projects to be performed by county employees. The corporation is funded entirely by private sources.
The incompatible public offices act, 1978 PA 566, MCL 15.181 et seq; MSA 15.1120(121) et seq, prohibits public officers and public employees from simultaneously serving two or more incompatible public offices. Section 1(b) of this act defines incompatible public offices as follows:
"Incompatible offices" means public offices held by a public official which, when the official is performing the duties of any of the public offices held by the official, results in any of the following with respect to those offices held:
(i) The subordination of 1 public office to another.
(ii) The supervision of 1 public office by another.
(iii) A breach of duty of public office.
As a threshold issue, it must be determined whether the positions of county controller and officer of a nonprofit corporation established to maintain a county-owned natural area constitute public offices for purposes of the incompatible public offices act. Section 1 of this act defines the terms public officer and public employee as follows:
(d) "Public employee" means an employee of this state, an employee of a city, village, township, or county of this state, or an employee of a department, board, agency, institution, commission, authority, division, council, college, university, school district, intermediate school district, special district, or other public entity of this state or of a city, village, township, or county in this state, but does not include a person whose employment results from election or appointment.
(e) "Public officer" means a person who is elected or appointed to any of the following:
(i) An office established by the state constitution of 1963.
(ii) A public office of a city, village, township, or county in this state.
(iii) A department, board, agency, institution, commission, authority, division, council, college, university, school district, intermediate school district, special district, or other public entity of this state or a city, village, township, or county in this state.
(emphasis added).
A plain reading of section 1(e)(ii) of the incompatible public offices act demonstrates that an appointed county controller is a public officer for purposes of the act. See also, OAG, 1983-1984, No 6180, p 175 (August 26, 1983) (county controller is subject to incompatible public offices act).
It must next be determined whether an officer of this nonprofit corporation constitutes a public officer or public employee for purposes of the incompatible public offices act. To answer that question, it must first be determined whether the nonprofit corporation constitutes a public entity for purposes of the incompatible public offices act.
Prior opinions of this office have concluded that a nonprofit corporation may constitute a public entity for purposes of the incompatible public offices act where a statute grants a state or a local unit of government the authority to create, organize and control the activities of a nonprofit corporation. See, OAG, 1975-1976, No 5047 p 495 (June 11, 1976) (economic development corporation constitutes a public office for purposes of the incompatible public offices act); OAG, 1993-1994, No 6781, p 93 (January 7, 1994) (municipal health facility constitutes a public office for purposes of the incompatible public offices act); OAG, 1987-1988, No 6527, p 354 (June 28, 1988) (county waste planning committee constitutes a public office for purposes of Const 1963, art 4, � 8).
Unlike the entities analyzed in the above opinions, there is no statute empowering a county or other local unit of government to create, organize or control the activities of a nonprofit corporation as described by your question. Moreover, the nonprofit corporation is funded entirely by trust funds derived exclusively from private contributions.
Some aspects of the nonprofit corporation may create the appearance that it is a public entity. For example, the corporation's articles of incorporation require it to operate in conformity with the Open Meetings Act (OMA), 1976 PA 267, MCL 15.261 et seq; MSA 4.1800(11) et seq. Despite that mandate, however, the OMA generally excludes nonprofit corporations from being "public bodies" for purposes of OMA compliance. Perlongo v Iron River Coop. TV Antenna, 122 Mich App 433, 435-436; 332 NW2d 502 (1983); OAG, 1985-1986, No 6386, p 369 (September 16, 1986). Thus, the fact that this corporation's articles require OMA compliance is itself insufficient to transform it into a public entity.
The corporation's articles vest it with the furtherance of a public purpose, i.e., to maintain a county-owned natural area. Without more, however, the performance of a public purpose is insufficient to establish it as a public entity. OAG, 1995-1996, No 6860, p 69, 72-73 (July 19, 1995), concluded that a nonprofit corporation providing housing to teachers and employees within a school district, despite furthering a public purpose, did not constitute a public entity for purposes of the incompatible public offices act. Like the nonprofit corporation in your question, the powers and duties of the nonprofit corporation analyzed in OAG, 1995-1996, No 6860, supra, were not defined, either directly or indirectly, through statutory authority, beyond those laws generally applicable to nonprofit corporations. Additionally, the nonprofit corporation in the instant case and the one described in OAG, 1995-1996, No 6860, supra, receive no public funding and were not established pursuant to statutory authority other than those statutes generally applicable to nonprofit corporations.
The ex officio members of the nonprofit corporation (i.e., the county commissioners) appoint the corporation's seven-member board of directors. Despite this nexus between the county and the corporation, however, the corporation's bylaws state that, except as otherwise provided in the articles or bylaws, all of the rights, powers, duties and responsibilities of the corporation's property, activities and affairs are vested in the corporation's board of directors. Since the corporation's articles and bylaws are virtually silent as to the powers and duties of the ex officio members, the county commissioners appear to have little, if any, authority regarding the operation and control of the corporation. Further, one member of the corporation's seven-member board of directors, the county controller, serves the county in another capacity. Finally, the terms of the corporation's board members are staggered, with each member serving a three year term. Thus, the county commissioners, as ex officio members of the corporation, have little authority regarding the operation of the nonprofit corporation.
Despite the interrelationships between the county and the corporation, factors contraindicating that the corporation is a public entity outweigh those supporting a finding that it is a public entity. To summarize, the corporation was neither specially established nor its powers and duties specially provided for by statute. The corporation's powers and duties are not specifically provided for by statute. The corporation receives no public funding. There is no contract or other agreement between the county and the corporation providing for the management or maintenance of the county-owned natural area. Thus, it must be concluded that the nonprofit corporation is not a public entity for purposes of the incompatible public offices act. Accordingly, officers of the nonprofit corporation are not subject to the incompatible public offices act.
Even if the nonprofit corporation were a public entity for purposes of the incompatible public offices act, an officer of the corporation would not constitute a public employee. Specifically, subsection 1(d), supra, of the incompatible public offices act provides that a public employee "does not include a person whose employment results from election or appointment." It is a fundamental rule of statutory construction that a clear and unambiguous statement must be enforced as written. Dean v Dep't of Corrections, 453 Mich 448, 454; 556 NW2d 458 (1996). Since the county board of commissioners appoints the corporation's board of directors and the directors, in turn, elect the corporation's officers, an officer would not constitute a public employee for purposes of the incompatible public offices act.
Similarly, assuming that the nonprofit corporation constitutes a public entity for purposes of the incompatible public offices act, it is doubtful that its corporate officers would constitute public officers under the act. Specifically, subsections 1(e)(i)-(ii), supra, of the incompatible public offices act provides that a public officer is an elected or appointed officer of the county or other public entity of the state. As to whether a particular position constitutes a public office, the Michigan Supreme Court in People v Freedland, 308 Mich 449, 457-458; 14 NW2d 62 (1944), held as follows:
"[W]e hold that five elements are indispensable in any position of public employment, in order to make it a public office of a civil nature: (1) It must be created by the Constitution or by the legislature or created by a municipality or other body through authority conferred by the legislature; (2) it must possess a delegation of a portion of the sovereign power of government, to be exercised for the benefit of the public; (3) the powers conferred, and the duties to be discharged, must be defined, directly or impliedly, by the legislature or through legislative authority; (4) the duties must be performed independently and without control of a superior power other than the law, unless they be those of an inferior or subordinate office, created or authorized by the legislature, and by it placed under the general control of a
superior officer or body; (5) it must have some permanency and continuity, and not be only temporary or occasional."
(citation omitted).
Application of Freedland, supra, compels the conclusion that the officers of the instant corporation do not occupy public offices for purposes of the incompatible public offices act. For example, the corporation was not created by the constitution, by statute, or pursuant to specific authority conferred by statute. Similarly, the powers and duties of the corporation, its board of directors, and its officers were not defined pursuant to legislative authority. Thus, even if the nonprofit corporation constituted a public entity, it is doubtful that its corporate officers would constitute public officers for purposes of the incompatible public offices act.
It is my opinion, therefore, that the incompatible public offices act does not prohibit a county controller from simultaneously serving as an officer of a nonprofit corporation established to assist in the maintenance of a county-owned natural area.
FRANK J. KELLEY
Attorney General