OPINION NUMBER - 078

ADOPTED - 1985/03/14

SUBJECT - Conflicts of Interest, A state senator, who represents as an attorney and a consultant, individuals seeking to form corporately-owned agricultural operations in other states, questions whether his introduction and support of a resolution to repeal Nebraska's constitutional prohibition of such corporate ownership creates a potential or actual conflict of interest.

REQUESTED BY: The Honorable John DeCamp, State Senator

QUESTION: You have requested the Commission's opinion as to whether you have either a potential or an actual conflict of interest pertaining to your action on LR16, a proposed constitutional amendment which would repeal Article XII, Section 8, of the Nebraska Constitution. Article XII, Section 8, prohibits corporate ownership of farm and ranch lands in Nebraska.

CONCLUSION

In view of the facts as you have stated them, and in view of the unique nature of a proposed constitutional amendment, it is the Commission's opinion that no potential or actual conflict of interest arises in your introducing and supporting this resolution.

FACTS

As we understand your situation, you currently represent, as an attorney and consultant, individuals seeking to form a corporation in another state(s) to buy and operate an agricultural operation(s). One or more of your present clients were previously part of a limited partnership cattle feeding operation in Nebraska before approval of Article XII,Section 8 of the Nebraska Constitution prohibiting such corporate ownership. Such ownership of a cattle-feeding operation is now forbidden by the constitutional provision.

You have introduced LR16, a legislative resolution which would repeal Article XII, Section 8 or, that failing, you would support an amendment to simply lift the current prohibition on corporate ownership of cattle feeding operations. Should your efforts be successful, you speculate that you, members of your family, and some of your clients may or may not take advantage of the opportunity to form a corporation to engage in farming or ranching in Nebraska.

ANALYSIS

The Commission has recently adopted a "reasonably foreseeable test in the area of potential conflicts of interest. That is, a potential conflict of interest under Section 49-1499 of the Nebraska Political Accountability and Disclosure Act exists for a public official when it is reasonably foreseeable that taking action or making a decision on a matter may cause financial benefit or detriment to the official, members of his or her immediate family, or a business he or she is associated with. Advisory Opinion #77, page 2. In addition, the financial benefit or detriment must be distinguishable from benefits or detriments accruing to the public generally or to a broad segment of the public.

Section 49-1499 of the Accountability and Disclosure Act is concerned with obtaining disclosure of the possibility that a decision-maker may realize private financial gains or losses from his or her official actions. However, the reasonably foreseeable standard indicates that potential financial benefits or detriments which are remote, highly uncertain, contingent, or speculative do not suffice to create a potential conflict under Section 49-1499.

Based on the facts you have presented, it is the Commission's position that any potential financial benefits or detriments would likely be too remote or contingent to constitute a potential conflict of interest situation. This is due to the facts presented, the nature of LR16, and of the Nebraska constitutional amendment process.

First, your resolution, LR16, would simply allow corporate ranching, farming and/or cattle feeding operations; it would not regulate such operations in any direct way. Thus, a person's intention to enter a corporate cattle feeding operation would be affected by ultimate approval of the proposed amendment by the voters; however, unless a present financial interest in a corporate cattle feeding or corporate farm or ranch operation currently exists, it is difficult to imagine how the allowing of such operations via repeal of Article XII, Section 8 of the Constitution could have a foreseeable, and not merely a speculative financial affect on yourself, your family, or a business with which you are associated. In contrast would be a situation, such as that in Advisory Opinion #77, where a senator was faced with voting on legislation which would have directly regulated businesses in which he is currently involved.

The Commission also believes that, because any financial benefits or detriments which could accrue from this resolution are contingent upon approval by a majority of the voters in the next general election, the potential benefits or detriments are too remote to constitute a potential conflict of interest. In adopting this position, we have taken the viewpoint that, under our system of constitutional amendments, proposal of an amendment by the legislature if fundamentally different from an ordinary legislative act.

In Nebraska, the power of amending the Constitution is reserved to the people, who have a right to legally alter their government. This power is one beyond the power of the Legislature. In a 1903 case, Weston v. Ryan, 70 Neb. 211, 97 N.W. 347, the Nebraska Supreme Court, per Ames, C. concurring, found it "plain and obvious" that "the act of submitting a proposed constitutional amendment to the electors is not an act of legislation at all." 97 N.W. 347, at 350. He continued, "The Legislature, in proposing an amendment to the Constitution acts in a capacity in strict analogy to that of a constitutional convention. When the proposed measure has received the . . . consent of three-fifths of the members . . . of the Legislature, it is ipso facto submitted to the people for their approval or rejection at the next general election. It cannot be repealed or revoked at either the same or subsequent session, and the electors cannot be deprived of a right to vote upon it . . ." Id. at 351.