Can an employee of one Texas county housing authority also work as a bookkeeper or consultant for another housing authority, or own a home in another authority's housing project?

Texas AG Opinion JM-610: Housing Authority Conflicts

Plain-English summary

The chairman of the House Committee on County Affairs asked how the conflict-of-interest rule for county housing authority employees works in two situations: whether an employee of one housing authority can serve as a consultant or bookkeeper for a different housing authority, and whether an employee can own a home that sits inside another authority's housing project.

JM-610 answered no to both. Section 6a of article 1269k bars a housing authority employee from owning or controlling any interest, direct or indirect, in any housing project, and from any dealings for pecuniary gain with a housing project except in performing the job itself. The opinion called this "an unusually broad prohibition." An employee who owns a home included in a housing project owns an interest in that project, so that is barred. And a bookkeeper or consultant for another authority would almost certainly be furnishing services connected to housing projects and dealing for pecuniary gain with them, which is also barred.

The key point is what the statute leaves out. The parallel rule for commissioners (section 6) expressly lets a commissioner deal with a housing project "over which the commissioner's housing authority has no jurisdiction." No such out-of-jurisdiction exception was written into the employee rule in section 6a. A knowing or intentional violation by an employee is a third-degree felony. Source: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1986/jm0610.pdf

Currency note

This opinion was issued in 1986 and construes article 1269k, the Housing Authorities Law, which has since been recodified into the Texas Local Government Code. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, penalty, or citation mentioned here.

Common questions

Can a housing authority employee moonlight as a bookkeeper for another housing authority?

Not if the work relates to a housing project. The opinion concluded "a housing authority employee could not serve another housing authority as consultant or bookkeeper if the latter work would relate to a housing project," because that means furnishing services to, and dealing for pecuniary gain with, a housing project. Source: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1986/jm0610.pdf

Can the employee own a home located in another authority's housing project?

No. The opinion said "an employee who owns a home included in a housing project owns an interest in that project," and section 6a bars that interest whether the project is run by the employee's own authority or another one. Source: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1986/jm0610.pdf

Why are employees treated more strictly than commissioners?

Because of what the Legislature left out. Section 6 gives commissioners an exception for projects outside their authority's jurisdiction, but the 1983 senate amendments that added that exception "were added to" the commissioner rule only. "No such exceptions were added to the conflict of interest provision pertaining to employees." Source: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1986/jm0610.pdf

Background and statutory framework

Article 1269k, the Housing Authorities Law, lets each county create a "public body corporate and politic" known as the county housing authority, run by a board of commissioners appointed by the commissioners court, with power to employ technical experts and other staff. "Housing project" is defined very broadly in subsection 3(i) to cover slum clearance, construction of low-income dwellings, and the related land, equipment, and services.

Since 1937 the law has barred commissioners and employees from acquiring "any interest, direct or indirect, in any housing project." House Bill 1505 in 1983 rewrote the conflict provisions into sections 6 (commissioners) and 6a (employees). Section 6 lists exceptions, including managing a project, keeping a pre-existing interest, and dealing with an out-of-jurisdiction project. Section 6a, covering employees, contains no comparable out-of-jurisdiction carve-out and makes a knowing violation a third-degree felony that also disqualifies the person from future public employment. Reading the two sections together, the opinion concluded the omission was deliberate and the employee bar reaches projects run by any authority. The opinion noted this breadth is unusual but not unique, comparing former article 988's bar on city council members holding other city employment. Source: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1986/jm0610.pdf

Citations and references

Statutes:

• Article 1269k, V.T.C.S. (Housing Authorities Law), sections 6 and 6a
• Former article 988, V.T.C.S.

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/jim-mattox/jm-0610
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1986/jm0610.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor OCR errors may remain; the linked PDF is authoritative.

December 31, 1986

Honorable Gary Thompson
Chairman
Committee on County Affairs
Texas House of Representatives
P. O. Box 2910
Austin, Texas 78769

Opinion No. JM-610

Re: Construction of section 6a of article 1269k, V.T.C.S., which addresses conflicts of interest by employees of housing authorities

Dear Representative Thompson:

You inquire about the conflict of interest provision applicable to employees of a county housing authority established under article 1269k, V.T.C.S. You ask:

Is it a violation under article 1269k, V.T.C.S. . . . for an employee of a housing authority to serve as a consultant or bookkeeper for another housing authority?

Is it a violation of the above-referenced statute for an employee of a housing authority to own a home included in another housing project (outside of the jurisdiction of the authority for whom he works)?

Article 1269k, V.T.C.S., authorizes each county of the state to establish "a public body corporate and politic to be known as the 'housing authority' of the county. . . ." V.T.C.S. art. 1269k, section 23a. A housing authority has the following powers, among others:

Within its area of operation: to prepare, carry out, acquire, lease, and operate housing projects; to provide for the construction, reconstruction, improvement, alteration, or repair of any housing project or any part thereof.

V.T.C.S. art. 1269k, section 8(b).

Unless a different meaning appears from the context,

'Housing project' shall mean any work or undertaking: (1) to demolish, clear, or remove buildings from any slum area; such work or undertaking may embrace the adaptation of such area to public purposes, including parks or other recreational or community purposes; or (2) to provide decent, safe, and sanitary urban or rural dwellings, apartments, or other living accommodations for persons of low income; such work or undertaking may include buildings, land, equipment, facilities, and other real or personal property for necessary, convenient, or desirable appurtenances, streets, sewers, water service, parks, site preparation, gardening, administrative, community, health, recreational, educational, welfare, or other purposes; or (3) to accomplish a combination of the foregoing. The term 'housing project' also may be applied to the planning of the buildings and improvements, the acquisition of property, the demolition of existing structures, the construction, reconstruction, alteration, and repair of the improvements and all other work in connection therewith.

V.T.C.S. art. 1269k, section 3(i). In some provisions of article 1269k, V.T.C.S., "housing project" is used in a narrower sense, to refer to a multi-unit dwelling constructed by a housing authority. Id. sections 6(a), 8(c), 9, 10.

A board of commissioners appointed by the county commissioners court exercises the powers of a county housing authority. V.T.C.S. art. 1269k, sections 5, 23a. The housing authority is empowered to employ technical experts and other employees as it may require and to delegate to its agents or employees such powers as it deems proper. V.T.C.S. art. 1269k, section 5.

The Housing Authorities Law, since its enactment in 1937, has prohibited commissioners and employees of an authority from acquiring "any interest, direct or indirect, in any housing project. . . ." Acts 1937, 45th Leg., ch. 462, section 6, at 1148. The conflict of interest provision was amended in 1983 by House Bill No. 1505 of the Sixty-eighth Legislature. Sections 6 and 6a of article 1269k now read as follows:

Sec. 6. Interested Commissioners. (a) No commissioner of an authority shall own, acquire, or control any interest, direct or indirect, in any housing project or in any property included or planned to be included in any project. Nor shall he have any interest, direct or indirect, in any contract or proposed contract for:

(1) the sale of land to be used for a housing project;

(2) the construction of a housing project; or

(3) the sale of materials or services to be furnished or used in connection with any housing project. Nor shall he have any dealings for pecuniary gain with any housing project.

However, it is not unlawful for a commissioner:

(1) to manage a housing project or to own, acquire, or control a management company rendering management services to a housing project;

(2) to continue to own or control any interest in a housing project held by the commissioner prior to his term as commissioner; or

(3) to own, acquire, or control any interest in or have any dealings with a housing project over which the commissioner's housing authority has no jurisdiction.

(b) If any commissioner of an authority manages, owns, acquires, or controls an interest, direct or indirect, in any property included or planned to be included in any housing project, or if any commissioner has any other dealings for pecuniary gain with any housing project, he shall immediately disclose the same in writing to the authority. The disclosure shall be entered upon the minutes of the authority. Failure to so disclose such interest shall constitute misconduct of office.

(c) [penalty]

(d) [disqualification from future public employment].

Sec. 6a. Interested Employees. (a) No employee of an authority shall own, acquire, or control any interest, direct or indirect, in any housing project or in any property included or planned to be included in any housing project. Nor shall the employee own, acquire, or control any interest, direct or indirect, in any contract or proposed contract for:

(1) the sale of land to be used for a housing project;

(2) the construction of a housing project; or

(3) the sale of materials or services to be furnished or used in connection with any housing project. Nor shall the employee have any dealings for pecuniary gain with any housing project, except in the performance of his duties as an employee of the housing authority.

(b) An employee who knowingly or intentionally violates Subsection (a) of this section commits an offense. An offense under this subsection is a felony of the third degree.

(c) A person finally convicted under Subsection (b) of this section is ineligible for future employment with the State, its political subdivisions, or a public corporation formed under authority of the State or a political subdivision of the State. (Emphasis added).

Acts 1983, 68th Leg., ch. 347, sections 2, 3, at 1833-35.

Your questions require us to construe section 6a. This provision bars a housing authority employee from having certain interests in a housing project, whether operated by the housing authority which employs him or another housing authority. This is an unusually broad prohibition, but it is not unique. Former article 988, V.T.C.S., as amended in 1981, prohibited city council members from holding another office or an employment under a city government. Acts 1981, 67th Leg., ch. 527, section 2, at 2230; see Attorney General Opinion MW-572 (1982).

A reading of section 6, which prohibits housing authority commissioners from holding certain interests in housing projects, supports our interpretation of section 6a. Section 6 prohibits commissioners from having certain interests in a housing project, but specifically permits interests, ownership, or dealings with "a housing project over which the commissioner's housing authority has no jurisdiction." This exception indicates the breadth of the section 6 prohibition: absent the exception, a commissioner would be barred from having an interest in a housing project outside the jurisdiction of his housing authority. This and other exceptions to section 6 were added by senate amendment to House Bill No. 1505. See Bill File to H.B. No. 1505, 68th Leg., Legislative Reference Library (1983). No such exceptions were added to the conflict of interest provision pertaining to employees.

We will answer your second question first. Subsection 6a(a) bars an employee from owning "any interest . . . in any housing project. . . ." In our opinion, an employee who owns a home included in a housing project owns an interest in that project. An employee of a housing authority may not own a home included in a housing project, whether it is under the jurisdiction of the housing authority which employs him or another housing authority.

Your first question concerns whether an employee of a housing authority may serve as a consultant or bookkeeper for another housing authority. Subsection 6a(a)(3) prohibits an employee from having any interest in a contract for the sale of services to be furnished in connection with any housing project. Nor may he have

any dealings for pecuniary gain with any housing project, except in the performance of his duties as an employee of the housing authority.

The powers of a housing authority are directed at providing "housing projects," a term defined very broadly in subsection 3(i) of article 1269k, V.T.C.S. A paid bookkeeper or consultant for a housing authority would probably engage in work related to particular housing projects. If he did so, he would contract to furnish bookkeeping or consultant services to a housing project. Moreover, his work for the housing authority would involve "dealings for pecuniary gain" with the housing projects of that authority. A housing authority employee is prohibited from having such interests in and dealings with housing projects operated by another housing authority.

In our opinion, a housing authority employee could not serve another housing authority as consultant or bookkeeper if the latter work would relate to a housing project. But see V.T.C.S. art. 1269k, section 11 (two or more authorities may co-operate in the exercise of their powers).

SUMMARY

Section 6a of article 1269k, V.T.C.S., bars an employee of a housing authority from serving as a consultant or bookkeeper for another housing authority or from owning a home included in another housing authority.

JIM MATTOX
Attorney General of Texas

JACK HIGHTOWER
First Assistant Attorney General

MARY KELLER
Executive Assistant Attorney General

RICK GILPIN
Chairman, Opinion Committee

Prepared by Susan L. Garrison
Assistant Attorney General