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Barry Skokowski, Sr.
Deputy Commissioner
Department of Community Affairs
CN 800
Trenton, New Jersey 08625-0800

Re: 91-0092: Municipal Attorneys as "Local
Government Officers" Pursuant to the
Local Government Ethics Law.

Dear Deputy Commissioner Skokowski:

You have requested advice as to whether a municipal
attorney is a "local government officer" pursuant to the Local
Government Ethics Law, N.J.S.A. 40A:9-22.1 et seq. For the below
stated reasons you are advised that a municipal attorney is a
"local government officer" pursuant to the Local Government Ethics
Law and therefore subject to its terms, particularly the
requirement of filing a financial disclosure statement.

The Local Government Ethics Law was enacted on February
20, 1991 and became effective 90 days thereafter on May 21, 1991.
L. 1991, c. 29, 27. The purpose of the Act is to provide a
Statewide method for governing the ethical conduct of local
government officers and employees and requiring financial
disclosure for local government officers. N.J.S.A. 40A:9-22.2(e).
To effect this purpose the Legislature has established a Statewide
Code of Ethics applicable to local government officers and
employees. N.J.S.A. 40A:9-22.5. This Code of Ethics is enforced
by the Local Finance Board. N.J.S.A. 40A:9-22.4. However, a
county or municipality may establish a county or municipal ethics
board to enforce the code of ethics. N.J.S.A. 40A:9-22.13,
N.J.S.A. 40A:9-22.19. The county or municipal ethics board
establishes the local code of ethics. N.J.S.A. 40A:9-22.13,
N.J.S.A. 40A:9-22.19. If the local code is not identical to the
State code, it is subject to the approval of the Local Finance
Board. N.J.S.A. 40A:9-22.13, N.J.S.A. 40A:9-22.19.

In addition to adhering to the ethical guidelines set
forth in the law, a "local government officer" is required to file
annually a financial disclosure statement, N.J.S.A. 40A:9-22.6,
which contains information about his or her sources of income,
certain business interests, and his or her real estate holdings in
New Jersey. Ibid. (Initially financial disclosure statements are
required to be filed by August 19, 1991, and thereafter annually by
April 30. N.J.S.A. 40A:9-22.6). To be subject to the requirement
of filing a financial disclosure statement, one must satisfy the
test of being a local government officer of a local government
agency. N.J.S.A. 40A:9-22.6. The term "local government officer"
is defined as,

any person whether compensated or not, whether
part-time or full-time: (1) elected to any
office of a local government agency; (2)
serving on a local government agency which has
the authority to enact ordinances, approve
development applications or grant Zoning
variances; (3) who is a member of an
independent municipal, county or regional
authority; or (4) who is a managerial
executive or confidential employee of a local
government agency, as defined in section 3 of
the "New Jersey Employer-Employee Relations
Act," P.L. 1941, c. 100 (C. 34:13A-3), but
shall not mean any employee of a school
district or member of a school board.
[N.J.S.A. 40A:9-22.3(g)].

Thus, a variety of persons serving in a "local government agency"
are included within the definition of "local government officer."

In contrast to the term "local government officer" is the
term "local government employee." This latter term is defined as
any person, whether compensated or not, whether part-time or
full-time, employed by or serving on a local government agency who is
not a local government officer, but shall not mean any employee of
a school district." N.J.S.A. 40A:9-22.3(f).

In order to understand who is a "local government
officer" the term "local government agency" should be examined. A
"local government agency" is defined as,

any agency, board, governing body, including
the chief executive officer, bureau, division,
office, commission or other instrumentality
within a county or municipality, and any
independent local authority, including any
entity created by more than one county or
municipality, which performs functions other
than of a purely advisory nature,but shall not
include a school board. [N.J.S.A. 40A:9-22.3(e)].

The term "local government agency" encompasses a myriad of local
government bodies and individuals. The definition is very broad
and specifically excludes only purely advisory bodies and school
boards.

The question is whether the municipal attorney serves i
a "local government agency." The position of municipal attorney or
corporation counsel is established by N.J.S.A. 40A:9-139. The
statute provides that every municipal governing body shall provide
by ordinance for the appointment of a municipal attorney for a term
of one year, unless the term of office is otherwise provided by
law. Ibid. The position of municipal attorney is deemed an
"office." Reilly v. Ozzard, 33 N.J. 529, 542-543 (1960).
Generally, an "office" is a post created or authorized by law for
the continuous exercise of a portion of governmental power or
authority. Ibid. A municipal attorney has broad responsibilities
to provide legal advice to the governing body and municipal
officials on any matter relating to municipal government. Perillo
v. Advisory Commission on Professional Ethics, 83 N.J. 366, 371-372
(1980). In larger municipalities, the municipal attorney may have
several other attorneys assisting him. Ibid.

It is apparent therefore that the position of municipal
attorney -- created pursuant to law by municipal ordinance -- is a
public office, rather than a position created by a service
contract, even in the cases of smaller municipalities where the
municipal attorney position is part-time and the individual
maintains a separate private law practice. An individual serving
in the office of municipal attorney must be contrasted with a
lawyer who serves the municipality in a special, limited capacity
(e.g. special labor counsel or to handle a particular tort or
environmental matter.) The latter representation are more akin to
that of an "independent contractor" and would not be subject in our
view, to the new Ethics Law. As an independent contractor, the
attorney would stand in the same relationship that any other
private vendor of services would have with a municipality, e.g.
computer repair firm, telephone installation firm, or food vendor.
There is generally no dispute that a private vendor would not be
subject to the Local Ethics Law. See State v. Indelicato, 87 N.J.
Super. 566, 569-570 (Law Div. 1965) (a professional auditor
contracted by the municipality to audit its books annually was an
independent contractor, and did not hold a public office).
Further, unlike a traditional independent contractor, persons who
serve as a municipal attorney may enroll in the Public Employees'
Retirement System. Attorney General Formal Opinion, No. 20 (1976).

Having determined that a municipal attorney is a
municipal officer and serves a local government agency, it is
necessary to determine if that position puts the incumbent in the
category of a person serving in local government deemed to be a
"local government officer" for purposes of the Local Government
Ethics Law. Included as "local government officers" are 1) elected
local officials; 2) members of local bodies that have authority to
enact ordinances, approve development applications, or grant zoning
variances; and 3) members of independent local authorities; and
N.J.S.A. 40A:9-22.3(g). A municipal attorney is not within the
scope of the first three classes of local government officers.

The fourth and last category of "local government
officer" is a person "who is a managerial executive or confidential
employee of a local government agency, as defined in section 3 of
the 'New Jersey Employer-Employee Relations Act.' P.L. 1941, c. 100
(C. 34:13A-3), but shall not mean any employee of a school district
or member of a school district." N.J.S.A. 40A:9-22.3(g)(4). As the
Local Government Ethics Law makes specific reference to the
definitions contained in the Employer-Employee Relations Act, it is
necessary to examine the latter Act. The Employer-Employee
Relations Act, N.J.S.A. 34:13A-1 et seq., provides a mechanism for
the resolution of labor disputes in the private and public section.
N.J.S.A. 34:13A-2. The Act is administered by the State's Public
Employment Relations Commissioner (PERC). N.J.S.A. 34:13A-5.2.

The Act defines "managerial executives" of a public
employer as,

persons who formulate management policies and
practices, and persons who are charged with
the responsibility of directing the
effectuation of such management policies and
practices, except that in any school district
this term shall include only the
superintendent or other chief administrator,
and the assistant superintendent of the
district. [N.J.S.A. 34:13A-3(f)].

"Confidential employees" of a public employer are defined as,

employees whose functional responsibilities or
knowledge in connection with the issues
involved in the collective negotiations
process would make their membership in any
appropriate negotiating unit incompatible with
their official duties. [N.J.S.A. 34:13A-3(g)].

The significance of "managerial executives" and
"confidential employees" under the Employer-Employee Relations Act
is that these individuals are excluded from membership in the local
collective bargaining unit comprising of local public employees.
N.J.S.A. 34:13A-5.3. The underlying purpose of this exclusion is
that "managerial executives" and "confidential employees" have
access to highly confidential labor relations information which
place persons in these positions in an intolerable conflict of
loyalties if they were to be part of a collective bargaining unit.
Wayne Tp. v. AFSME, Council 52, 220 N.J Super. 340, 346 (App. Div.
1987).

Neither the Employer-Employee Relations Act nor PERC's
regulations, N.J.A.C. 10:1-1 et seq., provide an enumeration of
positions in local government which are deemed a "managerial
executive" or a "confidential employee." Rather, the determination
of which positions are "managerial executive" or "confidential
employee" are case-by-case judgments. See e.g. In the Matter of
Township of Clark, 11 NJPER 283 16104 (1985), (Township
construction official was not a managerial executive). However,
PERC in its decisions has provided general guidance in making the
determination as to whether a person is a "managerial executive" or
"confidential employee."

A "managerial executive" is a person "who formulates
management policies or practices and person who are charged with
the responsibility of directing the effectuation of such management
policies and practices...." N.J.S.A. 34:13A-32.3(f). PERC has
established guidelines for determining whether a person formulates
management policy and direct its effectuation.

A person formulates policies when he develops
a particular set of objective designed to
further the mission of the governmental unit
and when he selects a course of action from
among available alternatives. A person
directs the effectuation of policy when he is
charged with developing the methods, means,
and extent of reaching a policy objective and
thus oversees or coordinates policy
implementation by line supervisors. Simply
put, a managerial executive must possess and
exercise a level of authority and independent
judgment sufficient to affect broadly the
organization's purposes or its means of
effectuation of these purposes. Whether or
not an employee possesses this level of
authority may generally be determined by
focusing on the interplay of three factors:
(1) the relative position of that employee in
his employer's hierarchy; (2) his functions
and responsibilities; and (3) the extent of
discretion he exercise. [Boro of Montvale, 6
NJPER 507, 508-09 11259 (1980)].

Thus, the determination as to whether a person is a "managerial
executive" requires an examination of the person's position in the
local agency's hierarchy, his job function and responsibilities,
and the amount of individual discretion exercised by the
individual. The analysis of these three factors is very often a
position-by-position determination.

The determination as to whether a person is a
"confidential employee" also requires an individualized
determination. PERC has narrowly construed the term "confidential
employee." County of Essex, 17 NJPER 256, 257 22118 (1991). The
"key" to status as a confidential employee "is an employee's access
to, and knowledge of, material used in labor relations processes
including contract negotiations, contract administration, grievance
handling and the preparation of these processes." Ibid.
Specifically PERC makes this case-by-case analysis as follows:

We (PERC) scrutinize the facts of each case to
find for whom each employee works, what he
does, and what he knows about collective
negotiations issues. Finally, we determine
whether the responsibilities or knowledge of
each employee would compromise the employer's
right to confidentiality concerning the
collective negotiations process if the
employee was included in a negotiating unit.
[State of New Jersey, 11 NJPER 507, 510 16179
(1985)].

Thus, a "confidential employee" has access to confidential
information of the employer which is relevant to the labor
relations of the local government agency.

To a large extent, by virtue of the definitional
standards employed by the Legislature, "local government officers"
are those individuals serving in local government who exercise a
high level of authority and independent judgment which directly
affects the policy and purposes of the agency and who have detailed
knowledge of the agency's confidential labor relations matters.
Not all municipal attorneys may be persons who formulate management
policies and who direct the effectuation of such policies.
However, municipal attorneys by the nature of the duties of this
office, participate in the formulation of management policies and
we believe that the office should be deemed a "managerial
executive." "Policymakers" include not only persons who occupy
traditional management executive positions, but also includes those
inthe legal profession who exercise discretion concerning issues of
public importance. Gregory v. Ashcroft, ___ U.S. ___, 111 S.Ct.
2395, 2404, 115 L.Ed.2d 410, 427-428 (1991) (Judges were deemed to
be policymakers). By the nature of their responsibilities,
municipal attorneys must exercise independent legal judgment and
discretion affecting issues of public concern. In addition,
municipal attorneys are by the nature of their position intimately
involved with the municipality's labor relations practices and is
in our view necessarily a "confidential employee" for purposes of
the Local Government Ethics Law.

Having concluded that the municipal attorney is a local
government officer who works for a local government agency, you are
advised that the municipal attorney is a local government officer
for purposes of the Local Government Ethics Law, N.J.S.A. 40A:9-22.1
et seq., and is subject to the requirement of filing a
financial disclosure statement.

Very truly yours,

ROBERT J. DEL TUFO
ATTORNEY GENERAL

 

By:___________________________________
JOHN J. CHERNOSKI
Senior Deputy Attorney General

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