                             ATTORNEY GENERAL OF TEXAS
                                           GREG        ABBOTT




                                              December 1, 2010



The Honorable Chuck Hopson                             Opinion No. GA-0826
Chair, Committee on General Investigating
     and Ethics                                        Re: Whether a member of the city council of
Texas House of Representatives                         Texarkana, Texas, may simultaneously serve as a
Post Office Box 2910                                   paid municipal fire fighter in Texarkana, Arkansas
Austin, Texas 78768-2910                               (RQ-0892-GA)

Dear Representative Hopson:

        You ask whether a member of the city council of Texarkana, Texas, may simultaneously
serve as a paid municipal fire fighter in Texarkana, Arkansas.' You inform us that Texarkana,
Arkansas has several ordinances which, in general, are intended to achieve base pay parity between
Texarkana, Arkansas, and Texarkana, Texas fire fighters. Request Letter at 1-2. A concern has been
expressed that, because of these ordinances, a Texarkana, Texas city council member's vote on the
salaries of its fire fighters might affect the salaries of Texarkana, Arkansas fire fighters. [d. at 2.

        You ask specifically whether a person may hold both positions in light of the statutory
conflict of interest provisions in chapter 171 of the Local Government Code and the self-employment
aspect of the Texas common-law incompatibility doctrine. [d. at 1-2. Determining whether these
legal principles apply to a person holding positions with municipalities in different states raises
issues of first impression which, in part, may depend on the particular facts concerning the positions.
However, while you have not elaborated about the position of the Texarkana, Arkansas fire fighter,
we will address applicable legal principles in general terms.

        You first ask that we address the applicability of the conflict of interest provisions in chapter
171 of the Local Government Code, but only if we conclude that Texarkana, Arkansas, is a "business
entity" under that chapter. Request Letter at 2. The chapter concerns a local public official's
conflicts of interest in various circumstances, particularly when the official "has a substantial interest
in a business entity." TEX. Loc. GOV'T CODE ANN. § 171.004(a) (West 2008). This office has
determined that a city is not a "business entity" under the chapter because it is a public entity, not
a private entity, and a city's purpose is not to produce financial benefits for private persons. See Tex.
Att'y Gen. Op. No. DM-267 (1993) at 2 (citing section 171.001(2) of the Local Government Code)


        ISee Request Letter at 1 (available at http://www.texasattorneygeneral.gov).
Representative Chuck Hopson - Page 2          (GA-0826)



(defining "business entity" for purpose of the chapter); cf Tex. All'y Gen. Op. No. GA-0031 (2003)
at 2 (determining for similar reasons that a school district is not a "business entity" under chapter
171). While Texas Attorney General Opinion DM-267 specifically concerned a Texas city, you have
not provided any information that would indicate that the status of an Arkansas city would be
different. Cf Jones v. Am. Home Life Ins. Co., 738 S.W.2d 387, 389 (Ark. 1987) (stating that
Arkansas "[m ]unicipalities are creatures of the legislature and as such have only the power bestowed
upon them by statute or the Arkansas Constitution"). Because it does not appear that an Arkansas
city is a "business entity" under chapter 171 of the Local Government Code, we do not consider the
chapter further.

        Next, we consider the common-law doctrine of incompatibility, which has three
aspects-self-appointment, self-employment, and conflicting loyalties incompatibility. See Tex.
All'y Gen. Op. No. GA-0786 (2010) at 1. You ask only about self-employment incompatibility. The
self-employment aspect of the doctrine prohibits a person from holding both an office and an
employment that the office supervises. Tex. All'y Gen. Op. No. GA-0738 (2009) at 2. As we
recently observed, "[t]he fundamental consideration under the self-employment aspect is the
supervision of the subordinate employment by the office." Id.; see also Tex. All'y Gen. Op. No.
GA-0536 (2007) at 4 (stating that "the key aspect of self-employment incompatibility is
supervision"); Tex. All'y Gen. LO-97-034, at 1 (self-employment incompatibility precludes a city
commissioner from serving in the same city's fire department because the commissioner "is in the
direct chain of supervision over a member of the fire department"). While you inform us about the
potential effects of Arkansas municipal pay-parity ordinances, how Texarkana, Arkansas
compensates its employees is a matter for that city to decide. You do not suggest that the Texas city
council supervises employees of the Arkansas municipal fire department. As a general principle, the
self-employment aspect of the Texas common-law doctrine of incompatibility does not apply to
preclude a person from serving simultaneously in two positions when neither position directly or
ultimately supervises the other. See, e.g., Tex. Att'y Gen. Op. Nos. GA-0786 (2010) at 2 (self-
employment incompatibility inapplicable to positions of special utility district board member and
college trustee), GA-0766 (2010) at 1 (self-employment incompatibility inapplicable to positions of
school district trustee and city manager), GA-0688 (2009) at 1 (self-employment incompatibility
inapplicable to positions of independent school district police chief and city council member).
Representative Chuck Hopson - Page 3         (GA-0826)



                                      SUMMARY

                       Generally, a municipality is not a "business entity" for
               purposes of the conflict of interest provisions of chapter 171 of the
               Texas Local Government Code. The self-employment aspect of the
               Texas common-law incompatibility doctrine does not apply to
               preclude a person from serving simultaneously in two positions when
               neither position supervises the other.

                                             Very truly yours,




DANIEL T. HODGE
First Assistant Attorney General

DAVID J. SCHENCK
Deputy Attorney General for Legal Counsel

NANCY S. FULLER
Chair, Opinion Committee

William A. Hill
Assistant Attorney General, Opinion Committee
