Airport Ethics Primer

By Jeff Wagner, Shareholder
Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C.

Most airports in Mississippi are owned and operated by a local governmental entity such as a city, a county or an airport authority created by a city or county. As such, employees of the airport as well as any appointed airport officials are subject to state and, if the airport has received federal funding through the Airports Improvement Program or other federal grant programs, federal ethics provisions.

Federal Ethics Provisions

Section 200.318(c) of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards requires that a grant recipient have mechanisms in place to ensure that no employee or appointed official receives improper benefit from a procurement made with federal funds. Generally, no employee or appointed official involved in the selection of a vendor paid with federal funds may have “a financial or other interest” in the firm selected for award. Further, this provision prohibits employees and appointed officials from soliciting or accepting gratuities or other favors from current or prospective contractors, subcontractors or other vendors. The grant recipient may set de minimis limits for unsolicited gifts of nominal value. Note: the recipient must adopt a policy on conflicts of interest under this rule.

State Ethics Requirements

Section 109 of the Mississippi Constitution of 1890 and the Mississippi Ethics in Government Law, MISS. CODE ANN.§25-4-101, et seq., sets forth the Mississippi ethical prohibitions for government employees and elected and appointed officials. Both Section 109 and the Ethics in Government Law prohibit any public official from being interested, directly or indirectly, in any contract authorized by the board of which he or she is a member during his or her term of office or for one year thereafter. Note: this prohibition is not dependent on the source of funds. In addition, the Ethics in Government Law prohibits any public official or employee from using his or her position for his or her own economic gain or for the benefit of any relative or any business with which he or she is associated (i.e., as an owner or employee).

A couple of bright lines can be drawn under both the federal and Mississippi ethics provisions. For example, under both, a public official cannot be the contractor on a construction contract let by his or her airport, nor can the public official accept gratuities or other benefits for assisting a vendor in securing a contract from his or her airport.

Potential Issues

Many airports around the state are governed by an appointed board with the appointees generally being individuals interested in aviation either as a pilot or aircraft owner or as business leaders in the community. This unfortunately, though, can create significant issues under the ethics laws. For example, an airport commissioner who owns an airplane cannot contract with his or her airport to lease a hangar. Likewise, an airport cannot generally use a bank where one of the airport’s commissioners is a stockholder or employee as its depository.

Guidance

Tom Hood, Executive Director of the Mississippi Ethics Commission, is available to provide guidance on Mississippi ethics issues. The Mississippi Ethics Commission will also provide formal, written opinions on specific issues when requested. The opinions are issued without names or other identifying information. The Mississippi Ethics Commission maintains a database of issued opinions on its website that may be browsed by type of governmental entity and that is text-searchable.

Statements of Economic Interest

Finally, please note that the Executive Director and each Commissioner of an airport authority must file a Statement of Economic Interest with the Mississippi Ethics Commission on or before May 1 of each year. A newly appointed Commissioner and a newly employed Executive Director must file his or her first Statement of Economic Interest within thirty (30) days of being appointed or employed.

Jeff Wagner is a shareholder with Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C. in Jackson, Mississippi, and may be reached at 601-973-3610 or by email at jwagner@bakerdonelson.com.