CHAPTER 575

FORMERLY

SENATE BILL NO. 124

AN ACT TO AMEND TITLE 29 OF THE DELAWARE CODE BY ADDING A NEW CHAPTER PROVIDING FOR THE MORE EFFECTUAL REGULATION OF THE CONDUCT OF OFFICERS AND EMPLOYEES OF THE STATE OF DELAWARE, ESTABLISHING STANDARDS THEREFOR, AND PROVIDING FOR DISCIPLINARY ACTION AND CRIMINAL PENALTIES FOR VIOLATION THEREOF.

Be it enacted by the General Assembly of the State of Delaware:

Section 1. Title 29, of the Delaware Code, is hereby amended by adding thereto a new chapter, Chapter 58, as follows:

"CHAPTER 58: LAWS REGULATING THE CONDUCT OF OFFICES

AND EMPLOYEES OF THE STATE OF DELAWARE.

§5801. Finding

The General Assembly finds and declares:

(a) In our democratic form of government, the conduct of officers and employees of the State of Delaware must hold the respect and confidence of the people. They must, therefore, avoid conduct which is in violation of their public trust or which creates a justifiable impression among the public that such trust is being violated.

(b) To ensure propriety and to preserve public confidence, officers and employees of the State of Delaware must have the benefit of specific standards to guide their conduct and of some disciplinary mechanisms to guarantee uniform maintenance of those standards. Some standards of this type are so vital to government that violation thereof should subject the violator to criminal penalties.

(c) In our democratic form of government, it is both necessary and desirable that all citizens, officers and employees of the State of Delaware included, should have certain specific interests in the decisions of the State government, and should be encouraged to assume public office and employment, and that, therefore, the activities and employees of the State of Delaware should not be unduly circumscribed.

§5802. Construction

This Chapter should be construed to promote high standards of ethical conduct in State government.

§5803. Definitions

For the purposes of this Chapter:

(a) "Business" includes a corporation, partnership, sole proprietorship, and any other individual or organization carrying on a business or profession.

(b) "Compensation" means any money, thing of value or any other economic benefit of any kind or nature whatsoever conferred on or received by any person in return for services rendered or to be rendered by himself or another.

(c) "Court" means the Superior Court.

(d) "Employee' means any person who has been elected or appointed to any State agency or who receives compensation for services to the same, but does not include members of the General Assembly, Justices of the Supreme Court, the judges of any Court, the Chancellor, Vice Chancellors, and Justices of the Peace.

(e) "Employment" means any rendering of services for compensation.

() An individual has a "financial interest" when he or she, his or her spouse, or children (natural or adopted) have an interest which is:

1. An ownership interest in a business;

2. A creditor interest in an insolvent business;

3. An employment or prospective employment for which negotiations have begun; or

4. An ownership interest in real or personal property.

(g) "State Agency" means the State of Delaware, its offices, departments, boards, commissions, committees, courts and all other public bodies existing by virtue of an act of the General Assembly or of the Constitution of this State excepting only political subdivisions of this State, their agencies and other public agencies existing by virtue of such state law whose jurisdiction is either (1) limited to a political subdivision of the State or to a portion of such a subdivision or (2) extends beyond the boundaries of this State.

§5804. Conflicts of interest

(a) No employee shall knowingly by himself or by any business in which he has a financial interest or by any partner, officer or employee of any such business, render or agree to render, for compensation or otherwise, any personal service to any person other than the State in any negotiations for the acquisition by any State agency of an interest in real property, or in any proceedings relative to such acquisition before a condemnation commission or court.

(b) No employee, nor any business in which he has a financial interest, nor any partner, officer or employee of any such business shall knowingly render or agree to render, for compensation or otherwise, any service to any person other that the State in connection with any cause, proceeding, application or other matter which is before the State agency in which such employee holds employment.

(c) No employee shall knowingly receive or agree to receive, directly or indirectly, compensation for services rendered or to be rendered, either by himself or by another, to any person, other than the State of Delaware, in connection with:

1. Any cause, proceeding, application or other matter before any State agency in the disposition or determination whereof the State has a direct financial interest, and the disposition or determination whereof is contested by the State or a State agency; or

2. Any appeal from a ruling or determination made by a State agency or employee in the discharge of his official duties.

(d) No employee shall knowingly himself, or by his partners or through any business in the pecuniary profits of which he has more than a ten percent interest, or by any other person for his use or benefit, or on his account, undertake or execute, in whole or in part, any contract, agreement, sale or purchase of the value of $25.00 or more, made, entered into, awarded or granted by any State agency, unless such contract, agreement, purchase or sale was made or let after public notice and competitive bidding.

(e) No employee shall act as officer or agent for the State in the transaction of any business with himself or with a business in the pecuniary profits of which he has more than a ten percent interest.

(f) No person who has served as an employee other than solely in the capacity of an independent contractor, shall knowingly receive or agree to receive, directly or indirectly, compensation for any services rendered or to be rendered, either by himself, or by another, anyone other than the State within two years after termination of his employment or service, in any cause, proceeding, application or particular matter in which he has given an opinion or made an investigation or with which he has been directly concerned in the course of his duties.

(g) Any employee who violates this section shall be fined in such amount or imprisoned for such term or both as the court in its discretion may determine.

§5805. Code of ethics

(a) Employees shall endeavor to pursue a course of conduct which will not raise suspicion among the public that he is likely to be engaged in acts that are in violation of his trust and which will not reflect unfavorably upon the State of Delaware and its government.

(b) No employee shall have any interest, financial or otherwise, direct or indirect, or engage in any business or transaction or incur any obligation of any nature which is in substantial conflict with the proper performance of his duties in the public interest. No employee shall accept other employment, any compensation, gift, payment of expenses, or any other thing of monetary value under circumstances in which such acceptance may result in any one of the following:

1. Impairment in the independence of judgment in the exercise of official duties.

2. An undertaking to give preferential treatment to any person.

3. Impeding government efficiency or economy.

4. The making of a governmental decision outside official channels.

5. Any adverse effect on the confidence of the public in the integrity of the government of the State of Delaware.

(c) No employee shall engage in any transaction as a representative or agent of the State with any business in which he has any financial interest that might reasonably tend to conflict with the proper discharge of his official duties.

(d) No employee shall by his conduct give reasonable basis for the impression that any person can improperly influence him or unduly enjoy his favor in the performance of his official duties or that he is improperly affected by the kinship, rank, position or influence of any person.

(e) No employee shall make personal investments in enterprises which he has reason to believe may be directly involved in decisions to be made by him or which will otherwise create substantial conflict between his duty in the public interest and his private investment.

(f) If any employee:

1. shall have a financial interest having a value of $1,000 or more in a business which is subject, in whole or in part, to the regulatory jurisdiction of, or contracts or does business with, any State agency; or

2. shall hold an office or directorship in any business which is subject, in whole or in part, to the regulatory jurisdiction of a State agency; or

3. shall have an unsecured loan exceeding $5,000 from any business which is subject, in whole or in part, to the regulatory jurisdiction of, or contracts or does business with, any State agency; or

4. shall have any other interest or relationship which he determines, in his discretion, might reasonably be expected to be particularly affected by any State agency; he shall file with the State Personnel Commission a written statement fully disclosing the same. Such disclosures and the information thereon shall be confidential and the State Personnel Commission shall not release the contents of such disclosures, except as may be necessary for the enforcement of this Chapter. The filing of such disclosures, pursuant to this Chapter, shall be a condition of entering upon and for continuing the duties as such employee.

(g) No employee shall use or attempt to use his official position to secure unwarranted privileges or exemption for himself or others.

() No employee shall engage in any activity beyond the scope of his employment which might reasonably be expected to require or induce him to disclose confidential information acquired by him by reason of his position as such employee.

() No employee, beyond the scope of his employment, shall disclose confidential information gained by reason of his official position nor shall he otherwise use such information for personal gain or benefit.

(a) No employee other than a person who provides services to the State solely as an independent contractor, nor any business in which such an employee has any financial interest shall sell goods or services to the State agency in which such employee serves or is employed.

§5806. Exemptions

In addition to the exemptions hereinabove provided, unless otherwise prohibited, nothing herein contained shall be construed to:

(a) Prohibit any business in which any employee is engaged from rendering services in relation to any matter before, or transacting business with, any State Agency where such employee does not directly or indirectly share in the profits resulting therefrom.

(b) Prohibit any transaction by any employee by reason of his ownership of corporate bonds or stocks which are bought or sold on a national securities exchange registered as such under the Securities Exchange Act of 1934.

(c) Prohibit participation in the affairs of charitable, religious, non-profit, educational, public service or civic organizations or the activities of national or State political parties.

(d) Prohibit the acceptance of awards for meritorious public contribution given by public service or civic organizations.

§5807. Contracts voidable by Court action

In addition to any other penalty provided by law, any contract entered into by any State agency in violation of this Chapter is voidable on behalf of the State; provided that in determining whether any court action should be taken to void such a contract, pursuant to this Section, the State agency shall consider the interests of third parties who may be damaged thereby and such court action to void the transaction must be initiated within thirty days after the State agency involved has, or should have, knowledge of such violation.

§5808. Administration and enforcement

(a) The State Personnel Commission created by Chapter 59 of this Title shall enforce the Code of Ethics prescribed by §5805 and shall exercise the powers and duties conferred and imposed upon it by Chapter 59, but without regard to any of the limitations therein, in connection with said enforcement.

(b) The Attorney General shall be the legal representative of the State Personnel Commission in connection with its duties hereunder.

(c) In addition, the State Personnel Commission shall have the following powers and duties:

1. It shall prescribe a form for the disclosures required hereby.

2. It shall render advisory opinions upon the request of any employee as to whether the facts and circumstances of a particular case constitute or will constitute a violation or probable violation of the Code of Ethics. If no advisory opinion is rendered within sixty days after such request and a complete statement of such facts and circumstances is filed with the Commission, it shall be deemed that an advisory opinion was rendered and that the facts and circumstances of that particular case do not constitute a violation of the Code of Ethics. Such an opinion rendered or deemed rendered, until amended or revoked by the Commission, shall be binding upon it in any subsequent complaint concerning any employee who sought the opinion and acted in reliance upon it in good faith, unless material facts were omitted or misstated by the employee in the request for the advisory opinion.

3. It shall initiate, receive and consider complaints concerning alleged violations of the Code of Ethics, initiate and/or make investigations and hold hearings concerning such complaints.

4. In its discretion, it shall have the power and duty to remove, suspend, demote or take other disciplinary action with respect to any employee, after a hearing, without regard to the limits imposed upon it by Chapter 59 but within the limits of the Constitution and other laws of this State.

(d) The Commission may request and shall receive from every State agency, its cooperation and assistance in the performance of the duties imposed upon the Commission hereby.

(e) Any person, including the individual making the charge of violation of the Code of Ethics, who divulges information concerning the charge prior to the issuance of a complaint by the Commission, or if an investigation discloses that a complaint shall not be issued by the Commission, at any time divulges any information concerning the original charge, or who divulges the contents of disclosures required by the Code of Ethics, except as otherwise permitted by law or by this Chapter, shall be guilty of a violation of the Code of Ethics.

() In the event that any person is dismissed or discharged or demoted or suspended for more than thirty days in any one year, within thirty days after such dismissal or discharge or demotion or suspension, said person shall have a right of appeal to the Superior Court on the question of whether the Commission acted in accordance with the law. The burden of proof in any such appeal shall be on said person. All appeals to the Superior Court shall be made by the filing of a notice of appeal with that Court within thirty days of the final action of the Commission in a particular case.

Section 2. If any provision of this Act, or the application thereof to any person or circumstances, is held invalid, the invalidity shall not affect other provisions or applications of this Act which can be given effect without the invalid provision or application of this Act, and to this end the provisions of this Act are severable.

Section 3. This Act shall become effective on the expiration of thirty days after its approval by the Governor.

Approved July 29, 1974.