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:

PUBLIC SCHOOL ACADEMIES:

SCHOOL AND SCHOOL DISTRICTS:

Board of education member also serving on public school academy board of directors.



The incompatible public offices act prohibits a person from simultaneously serving as a member of the board of education of a school district and as a member of the board of directors of a public school academy located within or outside the same school district.


Opinion No. 6996

September 22, 1998


Honorable Lyn R. Bankes
State Representative
The Capitol
Lansing, MI


You have asked whether the incompatible public offices act prohibits a person from simultaneously serving as a member of the board of education of a school district and as a member of the board of directors of a public school academy located within or outside of the same school district.

Section 2 of the incompatible public offices act, 1978 PA 566, MCL 15.181 et seq; MSA 15.1120(121) et seq, provides that "a public officer or public employee shall not hold 2 or more incompatible public offices at the same time." Section 1(b) defines incompatible 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.

At the outset, it is clear that the offices of a member of a local board of education and a member of the board of directors of a public school academy constitute public offices for purposes of the incompatible public offices act. Section 1 of the act defines public officer as follows:

(e) "Public officer" means a person who is elected or appointed to any of the following:


***

(iii) A . . . 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)(iii) of the incompatible public offices act demonstrates that an elected or appointed member of the board of education of a school district is a public officer subject to the incompatibility provisions of that act.

The Michigan Supreme Court has held that "public school academy board members are public officials and are subject to all applicable law pertaining to public officials." Council of Organizations and Others for Education v Governor, 455 Mich 557, 585; 566 NW2d 208 (1997). Relying on this precedent, OAG, 1997-1998, No 6966, p 96 (January 26, 1998), concluded that a member of the board of directors of a public school academy is subject to the public servants' conflict of interest act, 1968 PA 317, MCL 15.321 et seq; MSA 4.1700(51) et seq. It, therefore, follows that a member of the board of directors of a public school academy is also subject to the incompatible public offices act.

Since both offices implicated by your question are subject to the incompatible public offices act, the duties and responsibilities of each office must be examined to determine whether a prohibited incompatibility exists. See, OAG, 1993-1994, No 6791, p 121-122 (March 11, 1994).

The Revised School Code (school code), 1976 PA 451, MCL 380.1 et seq; MSA 15.4001 et seq, is an act to provide a system of public instruction. Generally speaking, school districts are charged with the education of their pupils and may provide, inter alia, preschool, adult education and recreation programs, as authorized by the Legislature. Section 11a.

Public school academies are governed by Part 6A of the school code, MCL 380.501 et seq; MSA 15.4501 et seq. A public school academy is a public school organized as a nonprofit corporation that is administered by a board of directors. Sections 501(1) and 502(1). A contract from an authorizing body is required before a public school academy may be established. Section 502(3). A public school academy may be open to all students who reside in this state who meet the admissions policy and shall be open to all pupils who reside within the geographical boundaries of the authorizing body who meet the admissions policy. Section 504(3). An authorizing body may be the board of a school district that operates grades K-12, an intermediate school board, the board of a community college, or the governing board of a state public university. Section 502(2). My staff is advised that the particular board of education involved in your question is not an authorizing body for the public school academy referenced in your question.

It must now be determined whether the simultaneous performance of the duties associated with the public offices involved in your question violates the incompatible public offices act.1 First, it is noted that the dual offices do not present a subordinate and supervisory relationship in contravention of sections 1(b)(i) and 1(b)(ii) of the incompatible public offices act. If, however, and regardless of whether the schools are located within the same district, a person serves on a school board that is the authorizing body of a public school academy for which that person also serves on its board of directors, a subordinate and supervisory relationship would result. See, school code sections 502(4); 506; 507(1).

Next, it is necessary to determine whether the dual positions identified in your question result in a breach of duty under section 1(b)(iii) of the incompatible public offices act. A breach of duty resulting in a prohibited incompatibility arises where the dual public officeholder cannot simultaneously protect, promote or advance the interests of both offices. OAG, 1979-1980, No 5626, p 543 (January 16, 1980); OAG, 1995-1996, No 6913, pp 197-198 (August 19, 1996). In addition, a breach of duty must actually result. Contesti v Attorney General, 164 Mich App 271, 280; 416 NW2d 410 (1987), lv den 430 Mich 893 (1988), citing OAG, 1979-1980, No 5626 at p 542. Moreover, assuming a prohibited incompatibility, abstaining from voting on questions does not cure the incompatibility; rather vacating an office is the only solution. Contesti, 164 Mich App at 281.

Thus, a breach of duty arises where a dual officeholder is on both sides of a contract or contractual negotiations, Contesti, 164 Mich App at 281-282; Wayne County Prosecutor v Kinney,2 184 Mich App 681, 684-685; 458 NW2d 674, lv den 436 Mich 887 (1990), or where the public offices compete for tax dollars. Contesti, supra; OAG 1995-1996, No 6918, p 211-212 (October 2, 1996). In Contesti, a breach of duty existed by virtue of the simultaneous performance of the duties of a township trustee and school superintendent where the school district contracted with the township to collect property taxes on its behalf and where the two entities annually competed for millage allocations. Contesti, 164 Mich App at 275, 280-281.

Public school academies and traditional public schools compete for a variety of resources. Evidence of such competition is found in the stated purposes for establishing public school academies, as well as in specific sections of the school code.

Enrolled SB 896, which became 1993 PA 362,3 established the foundation of existing laws governing public school academies. The House legislative analysis of SB 896, as enrolled, provides in relevant part:

The concept [of public school academies] has grown in popularity in recent years as a means of creating a new set of schools where innovation can flourish, where new teaching and learning strategies can be developed, or where a particular kind of approach (whether experimental or traditional) not typically found in the public schools can be employed. Such schools could aim at helping particular kinds of students. . . . Some people see charter schools (or public school academies) as a viable middle way between the monopolistic school system and a voucher-type choice system. The possibility that charters can be created by dissatisfied parents, teachers, or employers might work to improve existing schools. Where a number of charter schools exist in a community, parents will have meaningful choices to make about how their children are to be educated, and all the schools, traditional and charter, will have to function in a competitive environment.

House Legislative Analysis, HB 5121 et al, July 20, 1994. (Emphasis added.)

Legislative analyses may be used to help ascertain the purpose of a statute. See, LaMotte v Millers Nat'l Ins Co, 438 Mich 1, 5-6; 475 NW2d 13 (1991).

The foregoing legislative analysis anticipates that public school academies will develop a creative institutional personality which will appeal to a specific group of parents and students and which will compete with traditional schools. In theory, a public school academy is expected to compete for a certain group of students. In reality, both the school code, supra, and the State School Aid Act of 1979, 1979 PA 94, MCL 388.1601 et seq; MSA 15.1919(901) et seq, set in motion this competition for students. A general understanding of public school funding is necessary in order to comprehend the magnitude of this competition.

Under the State School Aid Act of 1979, supra, the state provides a basic foundation allowance for each pupil enrolled in a traditional public school or a public school academy. Sections 20(1) and (6). In fiscal years 1997-1998 and 1998-1999, the basic foundation allowance is $5,462 per pupil. Id. The foundation allowance for each pupil enrolled in a public school or public school academy is determined by a complex formula set forth in section 20 of the State School Aid Act of 1979 and is, in part, dependent upon where the child resides and enrolls in school. See generally, State School Aid Act of 1979 sections 20(3) and (6). For example, if a student leaves public school district A to attend public school academy B, school A experiences a reduction in state aid in future years, while school B receives an increase in state aid equal to that public school academy's foundation allowance.4 Since a public school academy is almost entirely dependent upon state aid,5 its success and survival depends upon the attraction, recruitment, enrollment, and retention of students. In fact, in order for a public school academy to receive state funding, it must make a good faith effort to advertise for the enrollment of students throughout the existing school district. Section 169 of the State School Aid Act of 1979.

As a result of this funding mechanism, each student enrollment represents state aid. The survival of a public school academy depends upon its ability to compete for students. Unlike traditional public schools, and absent a contractual limitation from the authorizing body, a public school academy may compete for any student residing within this state. School code section 504(3). Thus, a public school academy competes not only with those schools within the same district, but with schools throughout the state.

The question becomes, of course, whether a breach of duty actually results from this competition between public schools and public school academies for tax dollars via students. In Contesti, supra, a breach of duty was found, in part, where one individual, as a township trustee and as a school superintendent, was simultaneously involved in the preparation of the township budget and the school budget. Contesti, 164 Mich App at 281-282. Since both budgets were ultimately submitted to a county board that allocates finite funds, the individual was involved in aiding two competing budgets. Id. at 282. In the instant case, it is the competition for and allocation of state school aid through the attraction of students, that the dual officeholder referenced in your question is involved in aiding two competing budgets via efforts to attract, recruit, enroll, and retain students.

The degree of control which the dual officeholder possesses in the competition for tax dollars via students is not the dispositive issue; rather it is the positioning of the two offices involved in the competition for tax dollars via students. See, Wayne County Prosecutor, 184 Mich App at 685 (positioning of two offices on opposite sides of a contractual relationship). Accordingly, a breach of duty actually results where the same person who serves on the governing board of both a school district and public school academy, regardless of whether they are located within the same district, is confronted with and discharges the continuous responsibilities of competing for the same tax dollars via students.6

Similarly, a breach of duty also results where the dual office holder fails to protect, advance or promote the interests of both offices. OAG, 1995-1996, No 6913, supra. The powers of a public officer are fiduciary in nature. People v Overyssel Twp, 11 Mich 222, 225 (1863). A public officer must serve the public with undivided loyalty. 67 CJS, Officers & Public Employees, 201, pp 656-657. In the instant case, competition for the same tax dollars based upon student enrollment evidences a divided loyalty on the part of one person simultaneously serving on the governing boards of a public school district and a public school academy.

It is my opinion, therefore, that the incompatible public offices act prohibits a person from simultaneously serving as a member of the board of education of a school district and as a member of the board of directors of a public school academy located within or outside the same district.



FRANK J. KELLEY
Attorney General


1 Your question involves a dual system of public instruction whereby one person simultaneously serves on the governing board of both systems, i.e., the school district board and the public school academy board. This observation is significant, inasmuch as the school code is crafted so as to prohibit a person from simultaneously serving on multiple school boards. Sections 1101(1); 1103. Similarly, and although subsequently abrogated by statute, this office has concluded that, under certain circumstances, the offices of a board member of an intermediate school district and board member of a constituent school district are incompatible. OAG, 1965-1966, No 4129, p 75 (May 11, 1965); OAG, 1977-1978, No 5230, p 237 (October 3, 1977) (OAG, 1965-1966, No 4129, supra, is abrogated by statute).

2 The school code contemplates several situations where a board of a school district and a board of a public school academy may negotiate and enter into contracts with each other. Sections 11a(4); 1228; 1324; 1473. When and if such contracts are negotiated or entered into, a breach of duty by the dual office holder would actually result thereby triggering an incompatibility of the public offices.

3 MCL 380.501 et seq; MSA 15.4501 et seq.

4 The converse is true when a student leaves a public school academy and enrolls in a traditional public school.

5 See, school code sections 504(2) (public school academy cannot charge tuition); 504a(f) (public school academy may accept gifts and grants); 503(8) (public school academy may not levy ad valorem property taxes).

6 The board of a public school academy and the board of a school district may compete in ways other than for public funds. For example, the school code provides that voters within a school district may, pursuant to a properly filed petition and prevailing vote in the next election, force a school district to issue a contract for the operation of a public school academy. Section 503(2). Thus, persons who are dissatisfied with the existing system of public education may spawn competition by forcing a reluctant school district to authorize a public school academy.