FPPC Releases New Rule Covering Conflicts of Interests In Land Use Applications
by William R. Galstan on January 27, 2015
The Fair Political Practices Commission (“FPPC”) has adopted new rules to determine whether a public official has a conflict of interest when his or her real property interest is located near to a land use application.
Under the old rules, if any part of an official’s real property (or interest in real property with a fair market value of $2,000.00 or more) was located within 500 feet of the property lines of a land use application, the official was considered to have a conflict of interest because it was assumed that there would be a material financial effect (whether positive or negative) on the fair market value of the official’s property. In such case, the official would have to disqualify himself or herself from consideration of the application, unless it could be shown that the land use application would have no financial effect on the official’s property. If there would be no financial effect, the official go could ahead and vote on the matter.
The new rule, found at California Code of Regulations Title 2 Section 18, eliminates the 500-foot radius as a clear criteria to determine whether a conflict of interest exists. Now, a conflict may exist even if the official’s property is located more than 500 feet away from a parcel which is the subject of a land use application. The official must now consider whether the decision “would cause a reasonably prudent person, using due care and consideration under the circumstances, to believe that the governmental decision was of such a nature that its reasonably foreseeable effect would influence the market value of the official’s property.”
Additionally, even if it appears that the application can have no financial effect on the official’s nearby property value, the official must now receive a written advice letter from the FPPC before he or she may proceed to act on the matter.
Officials should be alert when land use applications come before them to determine the proximity of their property interest to the application. Staff can assist with determining the distance separation, although the 500-foot criteria is no longer the only factor in determining whether a conflict of interest exists. Officials should consult with the city attorney’s office in cases where proximity may be an issue, although only the FPPC can provide immunity from enforcement action through the issuance of an advice letter.
Finally, it should be noted that the “public generally” exception still applies when determining whether a conflict of interest exists. If the public in general would experience the same effect on property values as the public official, notwithstanding distance from the application, then the official may vote on the matter.