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Protecting the Integrity of
Local Planning Decisions

Matthew Boxer 
By Matthew Boxer
New Jersey State Comptroller

As towns across New Jersey start to rebuild in the wake of Sandy, it is vital that we protect the integrity of the process through which local planning boards make decisions about growth and development.

A recent investigation by the Office of the State Comptroller (OSC) illustrates the types of conflicts that can arise when elected officials use their public position to influence land use decisions in which they have a personal stake.

OSC’s investigation found that an elected municipal official had taken numerous official actions to facilitate a private land deal that brought him substantial profit. Using both his political influence and insider knowledge to push a complicated development project through multiple governmental hurdles, the elected official also shielded the fact that he had a personal financial stake in the project’s outcome. The investigation’s findings serve as a reminder that local officials must take preventative steps to address conflicts of interests that can arise when land use decisions are being made.

3 people discussing planning decisions

The first step is an obvious one: Government officials should refrain from taking official action on a matter in which they have a financial interest. In the case investigated by OSC, the municipality had a “Conflict of Interest Policy” that required its officials to immediately disclose potential conflicts to either the township attorney or municipal clerk for evaluation. However, in this case the official failed to notify the municipality about his financial interest in the development project and also omitted his financial interest on a state-mandated financial disclosure form. He then cast votes as a member of the township committee that served to further his personal financial interests.

It is important to note that violations of conflict of interest laws are not limited to the casting of official votes. Under state ethics and criminal law, public officials may not use their influence, position or access to inside information to secure a personal financial benefit. In this case, the elected official used his knowledge of a complicated local land use program and his influence with county government to further the development project in which he had a personal financial stake.

Protecting the integrity of local planning decisions requires more, however, than simply relying on the local officials involved to disclose any potential conflicts of interest. In the case investigated by OSC, the developer asserted it was under no duty to proactively disclose to the municipality its private deal with the local official. Municipalities should therefore consider requiring developers to certify, at the time they submit a development application, the identity of any members of the governing body or planning board who have a financial interest in the project or developer.

OSC’s investigation also revealed the need for municipalities to be aware of the potential for conflicts of interest whenever a member of a local government board seeks to personally transact business before that same board. In this case, the elected official also had sought a resolution from the planning board of which he was a member. The resolution would have benefitted a parcel of land he owned. In persuading his colleagues on the board to grant his petition, the official represented himself and addressed the members of the board directly, having stepped down from the planning board dais to make his application.

Five Ways to Promote Ethics

  1. Under state ethics and criminal law, public officials may not use their public position or access to inside information to secure a personal financial benefit.
  2. Government officials should refrain from taking official action on a matter in which they have a financial interest.
  3. Municipalities should consider requiring developers to certify, at the time they submit a development application, as to the identity of any members of the governing body or planning board who have a financial interest in the project or developer.
  4. When a member of a local government board seeks to personally transact business before that board, the board must proceed with caution and consider avenues to avoid the potential for a conflict or the appearance of a conflict.
  5. When a local official appears before a planning board comprised of individuals that he or she has appointed, the planning board should make every effort to identify other, suitable members to rule on the application.

When a member of a local government board seeks to personally transact business before that board, the municipality must proceed with caution and consider avenues to avoid the potential for a conflict or the appearance of a conflict. For example, it might require the board member to use an intermediary, such as a lawyer or land use expert, to make his or her case before the other board members.

In the case investigated by OSC, the conflict was further exacerbated by the fact that the board was comprised of individuals whom the local official in question had appointed in his role as an elected municipal official. When a local official appears before a planning board comprised of individuals that he or she has appointed, the planning board should make every effort to identify other, suitable members to rule on the application.

Although the Municipal Land Use Law provides a mechanism for towns with separate zoning and planning boards to replace conflicted members of one board with members from the other board, no such mechanism exists to authorize the replacement of conflicted members of a “consolidated” land use board that combines both functions. Since consolidated boards are prevalent in smaller communities, OSC has recommended that legislation be enacted to provide a mechanism for the temporary replacement of such board members who have a conflict of interest.

Steven Zweig, a senior staff attorney at the Office of the State Comptroller, contributed to this article.

 

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