[nfbmi-talk] an important public document
joe harcz Comcast
joeharcz at comcast.net
Wed Apr 28 14:01:41 UTC 2010
This is lengthy, but a public document. I might note here that Mr. Cannon is guilty of the same alleged conflicts of interests as the MCB Board does indeed supervise him and conduct his evaluations. Yet it was he as expressly set forth herein who brought these allegations to the State Ethics Board. Moreover, in the first sentence here it was stated that he (Cannon)) acted on behalf of the Board itself. This is quite a conflict indeed! Moreover, even if we agree with this determination it was acknowledged that neither Terry Eagle or Mark Eagle had any pecuniary gain. Yet, Cannon certainly does as he is paid in excess of $118,000 per yearr from the State of Michigan coffers with substantial pass through of federal monies. Much of that of course is dependent upon his personnel evaluations done annually by the MCB Board.
Now, clearly his influence upon this board in these regards are extraordinary, including his actions in this very complaint to the ethics board.
As stated in the public record he, Cannon even writes his own performance evaluation and he has these evaluations conducted in closed session (which is his right under the Open Meetings Act). But, case law does note that these personnel evaluations are public records under the Freedom of Information Act.
People not only have the right to know these things (and I'm talking about the general public), but, as part of a democratic republic we have the obligation to ensure that conflicts of interests by the highly paid Director of the Michigan Commission for the Blind are exposed and remediate.
NFB M's President has every right and a great obligation to pursue the FOIA on the manipulation of the MCB Board as he has done and I, for one applaud him highly for this.
State of Michigan
Board of Ethics
ETH ETH 2009-EA-01
Mark Eagle, Commissioner
Michigan Commission for the Blind
Michigan Department of Energy, Labor & Economic Growth
April 29, 2009
Patrick Cannon, Director
Michigan Commission for the Blind
Department of Energy, Labor, & Economic Growth
201 N. Washington, 2nd Floor
P.O. Box 30652
Lansing, MI 48909
By a December 4, 2008 letter, Patrick Cannon as Director, and on behalf of the Michigan Commission for the Blind (MCB), asked this Board to address 1) whether a conflict of interest arises where Mark Eagle is a member of the MCB and his father, Terry Eagle, represents various operators whose complaints ultimately come before the Commission for final resolution and, 2) whether the appointment of Commissioner Eagle's aunt, Cheri Eagle, to the Business Enterprise Program Elected Operator Committee creates a conflict of interest that affects his ability to deliberate and vote on issues in which his aunt is involved.
The State Ethics Board (Board) found that Commissioner Eagle had a personal interest that created a prohibited conflict of interest. The Board recognized that under ^1certain circumstances a conflict of interest may be cured by the public officer's recusal from those matters in which he or she has a personal interest. The Board found that the conflict of interest in this situation could not be cured since it was continuous, recurring, and pervasive. In light of this, it noted that Commissioner Eagle could not effectively function as a MCB Commissioner and that the only remedy for this conflict of interest was for Commissioner Eagle to resign or to be removed from his appointment.
A. Pertinent Facts
1. Function of the Michigan Commission for the Blind
The Michigan Commission for the Blind, established pursuant to MCL 393.351, consists of five members, three of whom must be blind, who are appointed by the Governor with the advice and consent of the senate. Annually, the Commission provides various services to nearly 4,000 blind or visually impaired individuals throughout the state. These services include vocational rehabilitation services, independent living services for the older blind, and youth low vision services for visually impaired students in the K-12 system.  It also serves as the State Licensing Agency (SLA) for blind entrepreneurs operating food service facilities on state and federal properties.^2
The MCB established a Business Enterprise Program (BEP) to help facilitate the food service initiative. Under this program a blind person becomes an operator (licensee) in the BEP and is allowed to run a concession in a government building following evaluation, training, and other services. The operator and the MCB enter into a contract that provides, among other things, that the operator will pay a certain percentage of the concession profits to the MCB. The MCB, in turn, will provide supervision and advice, needed equipment, and an initial stock of goods.
Additionally, as the SLA, the MCB also has a quasi-judicial function. For instance, when issues arise concerning an operator's failure to adhere to the rules governing the operation and administration of the BEP, the operator may request that an Administrative Law Judge (ALJ) hear her/his case. Once the ALJ reviews the case and makes a recommendation, the MCB decides whether to adopt or reject the recommendation, in whole or in part.
2. Function of the Business Enterprise Program Elected Operators
The BEP consists of approximately 90 blind operators. These operators elect 15 members to the Elected Operators Committee (EOC) annually. The EOC's authority and responsibilities are granted by the Federal Randolph-Sheppard Act. The EOC helps advance policies to the Commission and actively offers its input on major administrative decisions, policy, and program development decisions affecting the overall administration of the state's vending facilities program. The members of the EOC also work with BEP staff to resolve program policy issues. In addition, the ^3EOC receives and transmits operator grievances. The EOC presents recommended motions to resolve policy issues to the Commission for its approval. The MCB ultimately makes the final decision on all motions presented by the EOC. The majority of the motions on which the Commission must render a decision originate from BEP.
3. Pertinent Background Information
Mark Eagle is a member of the MCB, appointed by the Governor in the fall of 2007.
Commissioner Eagle’s father, Terry Eagle, represents various operators whose complaints ultimately come before the Commission for resolution. Although Terry Eagle is not an attorney, the rules do allow operators to be represented by non-attorney representatives in the hearings. Terry Eagle was not a representative at the time of Mark Eagle’s appointment to the MCB.
At the September 2008 MCB meeting Terry Eagle stated that he served as the representative of an operator whose case was under consideration. With this announcement, the question of a conflict of interest arose with Commissioner Eagle's participation in the deliberation and vote on this particular matter. The MCB did not vote on the conflict question and Commissioner Eagle participated in the deliberations and voting. Commissioner Eagle was active in the Commission’s decision-making process in addressing recommendations made by his father on behalf of parties before the Commission.^4
The issue of conflict also arose at the December 2008 meeting when it was time to vote on three ALJ recommended decisions. Terry Eagle represented the two operators involved, one of which was Commissioner Eagle's aunt, Cheri Eagle, who had two cases pending before the MCB. At this meeting, Commissioner Eagle recused himself from the deliberations and did not vote.
The issue of conflict arose once again on December 6, 2008, when Cheri Eagle was appointed to the EOC after one of its members resigned. The Board has since learned that although Ms. Eagle continues to be an operator in the BEP, she resigned from the EOC a couple weeks prior to the Board's February 26, 2009 meeting.
Mr. Cannon informed the Board that during the appointment process, he informed the Governor's office that Terry Eagle was a former operator and client of the Commission and that from time to time he interacted with the agency. However, shortly after Commissioner Eagle's appointment, his father became highly involved in various aspects of the Commission's operations, particularly the BEP and EOC. At the Board’s meeting, both Director Cannon and Commissioner Eagle acknowledged that Terry Eagle currently represents over 50 percent of the operators whose complaints will ultimately come before the Commission for final resolution. Commissioner Eagle stated he recused himself when matters involved family members Cheri Eagle and Terry Eagle, and would continue to do so because he believed it was the right thing to do.^5
B. Jurisdictional and Procedural Issues
The State Ethics Act applies to "public employees" and "public officers". As appointees of the Governor, MCB Commissioners are public officers and are subject to the Ethics Act.
C. Board Decisions
After deliberation, based upon the discussion of the parties, the information submitted and consistent with its prior decisions, the Board decided as follows.
Under the Ethics Act, a personal interest of a public officer includes the interest of a public officer's father or aunt, even though the public officer may not receive monetary or pecuniary remuneration. The Board held that Commissioner Eagle has a personal interest in matters before the Commission where his father or aunt is involved. The Board recognized that under certain circumstances when a conflict of interest is present, the individual with the conflict of interest can recuse himself or herself from the deliberative process or abstain from voting on those matters. However, the Board found that because the conflicts of interest presented in this situation are continuous, recurring, and pervasive, recusal or abstention would not be an adequate remedy. In light of this, it held that Commissioner Eagle could not effectively function as a MCB Commissioner and that the only remedy for this conflict of interest was for Commissioner Eagle to resign or be removed from his appointment.^6
The Board of Ethics is a creature of statute and limited by the law under which it operates. Section 2 of the Ethics Act prescribes standards of conduct for public officers and employees. The MCB inquiry implicates sections 2(6) and 2(7) of the Ethics Act.
Section 2(6) provides:
Except as provided in section 2a, a public officer or employee shall not engage in or accept employment or render services for a private or public interest when that employment or service is incompatible or in conflict with the discharge of the officer or employee’s official duties or when that employment may tend to impair his or her independence of judgment or action in the performance of official duties.
Section 2(7) provides in relevant part:
Except as provided in section 2a, a public officer or employee shall not participate in the negotiation or execution of contracts, making of loans, granting of subsidies, fixing of rates, issuance of permits or certificates, or other regulation or supervision relating to a business entity in which the public officer or employee has a financial or personal interest.
These two provisions form the context of the Board’s analysis. The two-fold purpose of these prohibitions is to prevent conflicts between a public officer's official duties and private interests and to prevent individuals from using their position as public officers to obtain favorable treatment for themselves or another person or entity.^7
Public officers and employees are expected to exercise independent judgment in the performance of their official duties. Section 2(6) of the Ethics Act prohibits any employment that "may tend to impair" the public officer's independence of judgment or action in the performance of his or her official duties. Based on the facts in this case, the Board finds that Commissioner Eagle did not violate section 2(6) of the Ethics Act since he has not performed any services that may tend to impair his official duty and his father's or aunt's services cannot be imputed to him.
Under Section 2(7) of the Ethics Act, MCL 15.342(7), the Legislature prohibited a public officer from participating in the issuance of permits or certificates, or other regulation or supervision relating to a business entity in which the public officer or employee has a financial or personal interest. This section is applicable because the MCB regulates blind entrepreneurs running food service facilities on state and federal properties by adopting standards that an operator must meet in order to be eligible to operate a concession.
Prior Board opinions hold that the interest of a public officer’s family member is a personal interest of the public officer and define “personal interest” as:
. . . personal profit, financial benefit, incompatibility or conflict, impairment of judgment or action, a direct or an indirect financial or personal interest, the interest of the employer, the interest of a company that is doing business with the employer, the interest of a spouse, and the interest of one with whom an intimate relationship exists . . .^8
In Fischer, during the settlement negotiations, the Director of the Public Service Commission's Office of Regulatory Operations, publicly disclosed the fact that the president of Michigan Gas Company (MiGas), a regulated utility, was a close personal friend, and that his son was employed at the utility. Mr. Fischer initially abstained from any participation in the case, but later became involved when negotiations had failed. The Board was asked to determine whether a violation of the Ethics Act occurred based on the facts outlined above.
The Board determined that a personal interest includes the father-son relationship as well as a close friendship which has risen to the level of an intimate relationship. The Board held that Mr. Fischer had violated the Ethics Act when he participated in the settlement negotiations but found that since the personal interest is not continuous, recurring, or pervasive, Mr. Fischer could avoid violating the Act by abstaining from matters involving MiGas.
Similarly, in Hamill, the Board addressed whether a conflict of interest existed where sons of two Michigan Department of Transportation (MDOT) employees, a State Project Engineer and Senior Inspector, were employed by a private general contractor who was awarded a building contract by the MDOT. The sons sought and obtained the temporary summer employment entirely on their own and the contractor paid them the lowest hourly laborer wage offered by the contractor. The MDOT employees did not have any control over the general contractor's work assignment for the two sons. In addition, since all construction contracts awarded by the MDOT are ^9handled by the Department of Management and Budget through competitive bidding, the MDOT employees had no control or input in the competitive bidding process.
The Board found that a personal relationship as contemplated by the Act did exist but concluded that the employment of these two sons by the general contractor was purely coincidental. Unlike the instant case, the Board found that there was no Ethics Act violation because any personal interest that would be present would be de minimus since the sons were hired as the lowest paid laborers.
In other decisions, however, the Ethics Board has found that if the involvement is continuing, recurring, or pervasive, the public officer or employee cannot avoid violation of the Ethics Act by merely abstaining on specific occasions. In the case of Hillary F. Snell, Commissioner for the Department of Natural Resources, the Board found that a conflict of interest would exist where Snell served as a Commissioner and a partner in her law firm that simultaneously represented a group which regularly appeared before the Commission.
The Board acknowledges that the MCB has many functions other than its SLA function, but also recognizes that the SLA role is a major function subject to the Commission's jurisdiction. In this situation, since Terry Eagle represents over 50 percent of the operators whose complaints will ultimately come before the MCB, this conflict of interest is definitely continuous, recurring, and pervasive. Commissioner Eagle's willingness to abstain from participating in matters in which his father or aunt is involved is both commendable and expected. However, this is an inadequate remedy.^10
Reicks, made clear that recusal is an inadequate remedy to a conflict of interest in certain circumstances:
[A] public officer or employee can avoid violating the Ethics Act if he or she abstains from participation in a matter in which the personal interest of the public officer or employee is involved, unless the involvement is continuing or recurring, in which case the public officer or employee cannot avoid violating the Ethics Act by abstaining.
Further, it is also appropriate to examine sources other than prior Board opinions when analyzing whether a conflict exists. The Board, in Smith, issued an advisory opinion concluding that, although the circumstances in that case did not constitute a violation of the ethical standards of Section 2 (6) of the Ethics Act, the rule in Warren Consolidated Schools v Employment Relations Commission, 67 Mich App 58; 240 NW 2d 265 (1976), was applicable to the circumstances presented. In Warren, the Court of Appeals vacated a decision of the Michigan Employment Relations Commission and remanded the matter back to the Commission because one of the commissioners, who was a brother and former law partner of the attorney for one of the parties to the case, actively participated in the decision. In ruling, the court stated:^11
The object of this rule of absolute disqualification is more than a guarantee that a legal dispute will be resolved objectively by unbiased and impartial persons. It is also a shield against any suspicion on the part of the litigants and the public that any subjectivity, bias and partiality contributed to the outcome of the dispute. The thought behind such a rule was best expressed by Justice Frankfurter in Baker v. Carr, 369 US 186, 267; 82 S Ct 691, 737-738 (1962):
The Court's authority -- possessed of neither the purse nor the sword -- ultimately rests on sustained public confidence in its moral sanction. Such feeling must be nourished by the Court's complete detachment, in fact and in appearance, * * *
We find attainment of what the rule seeks to accomplish impossible with brother arguing to brother whether the proceeding be judicial or administrative, and even where the only impropriety on the record is the fact that one brother participated in the decision of a controversy in which his brother was one of the advocates.
The Warren court held that the rule of absolute disqualification applicable to judicial proceedings is also applicable to administrative proceedings. MCR 2.003 provides that a judge shall be disqualified when he or she cannot impartially hear a case because a person within the third degree of relationship is 1) a party to the proceeding, or an officer, director or trustee of a party, 2) acting as a lawyer in the proceeding, or 3) known by the judge to have a more than de minimis interest that could be substantially affected by the proceeding.
Thus, in accord with our previous decisions, we find that when disqualification is continuous, recurring, or pervasive, it is not enough to merely abstain. Even if Commissioner Eagle were to abstain and not participate in the any of the matters in which his father or aunt is involved as he has stated he would do, we find that his inability to participate would impede the full and faithful discharge of his public duties. Considering Terry Eagle's continuing representation of various operators whose^12 complaints ultimately come before the MCB for final resolution, there is no way that Mark Eagle can perform effectively as a member of the MCB by disqualifying himself when these matters are brought before the Commission.
It is the opinion of the Board, therefore, that under the Ethics Act a personal interest of a public officer includes the interest of a father or aunt, even though the public officer may not receive monetary or pecuniary remuneration. The Board finds that Commissioner Eagle has a personal interest in matters brought before the MCB where his father or aunt is involved. The Board recognizes that under certain circumstances when a conflict of interest is present the individual with the conflict of interest can recuse himself or herself from the deliberations or abstain from voting. However, the Board finds that recusal or abstention would not be an adequate remedy in this situation since the conflicts of interest presented are continuous, recurring, and pervasive. In light of this, the Board is of the opinion that Commissioner Eagle cannot effectively function as a MCB Commissioner and that the only remedy for this conflict of interest is for Commissioner Eagle to resign or be removed from his appointment.
The Board requests that this Advisory Opinion be conveyed to the Governor.
“Yea” votes: Absent:
Lynn Jondahl Frederick P. Dillingham
Mark R. Fox Frank J. Kelley
John D. Pirich^13
Rabbi Paul Yedwab
“Nay” votes: Recused:
BY ORDER OF THE BOARD
April 29, 2009
Top of Form
Bottom of Form
 MCL 393.352 (1).
 The background information was acquired from the DELEG Internet site for the Michigan Commission for the Blind: http://www.michigan.gov/dleg/0,1607,7-154-28077_28313-14762--,00.html.
 MCL § 393.359 requires that "[a] concession in a building or on property owned or occupied by this state shall be operated by a blind person." Additionally, in MCL § 393.363, the legislature designated the Commission to implement the Randolph Sheppard vending stand act pursuant to 20 USC § 107 et seq.
 20 USC § 107.
 February 26, 2009 Tr (Cannon) p 12.
 February 26, 2009 Tr. (Cannon) p 13.
 The MCB Meeting Minutes from the September 2008 Meeting.
 February 26, 2009 Transcript ("Tr") (Cannon) p 16.
 February 26, 2009 Tr. (Cannon) pp. 12-13.
 February 26, 2009 Tr. (Cannon) p. 16 & (Commissioner Eagle) pp. 33-34.
 MCL 15.341(b)-(c).
 MCL 15.343; MCL 15.345.
 MCL 15.342.
 1973 PA 196, §§ 2(6-7), MCL 15.342(6)-(7).
 Since Section 2a, MCL 15.342a, applies to public officers who participate in State contracts, it does not apply to this case.
 See In Re: David Porteous, Chairman, Michigan Strategic Fund, ETH 1994-EA-1, p. 4 (December 9, 1994).
 In Re: Roger F. Fischer, Director, Office of Regulatory Operations, PSC, ETH 1989-EA-1, pp. 5-8 (July 02, 1991) pp 5-6, citing to Reicks, 77-EA-8 (May 31, 1977); Bellenger, 77-EA-6 (May 31, 1977); Snell, 75-EA-5 (July 18, 1975); and Lewis, 74-EA-5 (October 9, 1974). In Re: Travel Commission, 78-EA-5 (May 5, 1978).
 Fischer, ETH 1989-EA-1, (July 02, 1991).
 In Re: Robert Hamill, Personnel Officer, Department of Transportation, ETH 1980-EA-1, (January 15, 1980).
 Hamill, ETH 1980-EA-1, pp. 4-5.
 Snell ETH 1975-EA-5, pp. 3-4.
 In Re: George H. Reicks, Member, Air Pollution Control Comm, ETH 1977-EA-8, p. 3 (May 31, 1977) citing to In Re: William S. Ballenger, Director, Licensing and Regulation, ETH 1977-EA-6 (May 31, 1977). Also see E.g. In Re: Kenaga, ETH 1977-EA-12 (December 15, 1977). In Re: Snell, ETH 1975-EA-5 (July 18, 1975); and In Re: Chairman, Michigan Environmental Review Board, ETH 1975-EA-3 (March 10, 1975).
 In Re: Nan Smith, Member, Barrier Free Design Board Department of Labor and
Richard Smith, Administrative Assistant for Barrier Free Design to the Director
Bureau of Construction Codes Department of Labor, ETH 1979-EA-11, (June 12, 1979).
 The Michigan Attorney General also arrived at the same conclusion. See OAG, 1979-1980, No 582 (February 1, 1980).
 Warren Consol Schools v Employment Relations Comm, 67 Mich App 58, 59-60; 240 NW2d 265, 266 (1976).
 MCR 2.003(B)(6) (a)-c)
 MCL 15.345 (4)
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