                        TO BE PUBLISHED IN THE OFFICIAL REPORTS

                           OFFICE OF THE ATTORNEY GENERAL
                                     State of California

                                DANIEL E. LUNGREN
                                   Attorney General
                     ______________________________________
                       OPINION                :
                                              :     No. 98-302
                           of                 :
                                              :     August 18, 1998
                 DANIEL E. LUNGREN            :
                    Attorney General          :
                                              :
                  CLAYTON P. ROCHE            :
                     Deputy Attorney          :
                        General
                                              :
     ______________________________________________________________________

     THE HONORABLE CHARLES R. MACK, COUNTY COUNSEL, YOLO COUNTY, has
requested an opinion on the following question:

      May a county supervisor be employed by the county housing authority commission to serve
as its secretary and executive director?

                                         CONCLUSION

      A county supervisor may be employed by the county housing authority commission to serve
as its secretary and executive director.

                                           ANALYSIS

     The Housing Authorities Law (Health & Saf. Code, §§ 34200-34606) Footnote No. 1 was
enacted by the Legislature to address "a shortage of safe or sanitary dwelling accommodations
available at rents which persons of low income can afford . . . ." (§ 34201, subd. (a).) Section
34240 provides:

     "In each county and city there is a public body corporate and politic known as the housing
authority of the county or city. The authority shall not transact any business or exercise its
powers unless, by resolution, the governing body of the county or city declares that there is need
for an authority to function in it."

Section 34242 states:
     "The governing body may adopt a resolution declaring that there is need for a housing
authority if it finds either of the following:

        "(a) That insanitary or unsafe inhabited dwelling accommodations exist in the county or
city.

      "(b) That there is a shortage of safe or sanitary dwelling accommodations in such county or
city available to persons of low income at rentals they can afford."

      With respect to a county housing authority, the board of supervisors appoints five
commissioners, and in certain circumstances also appoints tenants of the authority, all of whom
serve for fixed terms. (§§ 34271-34272.) Footnote No. 2 Housing commissioners may be removed
by the board of supervisors for "inefficiency, neglect of duty, or misconduct in office." (§
34282.) Here, we deal with a county housing authority commission consisting of five
commissioners and two tenant commissioners appointed by the board of supervisors. The
question presented for resolution is whether the commission may employ a county supervisor as
its secretary and executive director. We conclude that it may.

      A county housing authority commission has responsibility for hiring officers and employees
"as it requires." "An authority . . . may employ a secretary, who shall be executive director,
technical experts, and such other officers, agents, and employees as it requires, and
shall determine their qualifications, duties, terms of employment and compensation." (§ 34278,
subd. (a).) The commission's personnel rules and regulations shall contain "procedures affecting
conflicts of interest . . . ." (Ibid.; see Figueroa v. Housing Authority (1982) 131 Cal.App.3d 528,
532.)

1.       Rule Against Incompatible Public Offices

     The first issue to be considered is whether a county supervisor would be precluded from
serving as a county housing authority's secretary and executive director due to the common law
doctrine of incompatible public offices. Under this doctrine, acceptance of the second office
constitutes an automatic resignation from the first office. Offices are incompatible if there is any
significant clash of duties or loyalties between the offices, or if one office has supervisory,
auditory, or removal power over the other. The doctrine, however, applies only if both positions
are offices. If one of the positions is that of an "employee," the doctrine is inapplicable. (See 80
Ops.Cal.Atty.Gen. 74, 75 (1997); 78 Ops.Cal.Atty.Gen. 362, 363 (1995); 73 Ops.Cal.Atty.Gen.
268, 269-270 (1990).)

     Undoubtedly a member of a county board of supervisors holds a public office for purposes
of the incompatible offices doctrine. (67 Ops.Cal.Atty.Gen. 409, 410 (1984).) However, is a
secretary and executive director of a housing authority an officer or employee for purposes of the
common law prohibition? This question was addressed in a 1978 letter opinion (Cal.Atty.Gen.,
Indexed Letter, No. IL 78-102 (July 18, 1978)) in which we concluded that the executive
secretary of a county housing authority does not hold an "office" for purposes of the common
law rule. We stated:
     "While Health and Safety Code section 34278(a) authorizes the employment of an
executive secretary, the position, if created at all, is a creature of a contract entered into by the
authority, which sets the terms of employment. A public officer is not the offspring of a contract.
(Pacific Finance Corp. v. City of Lynwood (1931) 114 Cal.App. 509, 514.) No statutory duties
are set forth for the executive secretary; rather, the commissioners determine the duties and
functions performed. The commissioners, not the executive secretary, exercise the sovereignty of
the state. The position of executive secretary is transitory, subject to being abolished if the
commissioners so choose. If the position is filled, the contract of employment, rather than statute,
dictates the terms of employment. (Cf., Holtzendorff v. Housing Authority (1967) 250
Cal.App.2d 596.)

     ". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

    ". . . The common law doctrine of incompatibility of office is inapplicable to the position of
housing authority executive secretary because that doctrine applies only to public offices. . . ."

      We reaffirm our 1978 conclusion. The secretary and executive director of a housing
authority does not hold an office for purposes of the incompatible offices doctrine. Accordingly,
this common law rule would not prevent a county supervisor from being employed as the
secretary and executive director of a county housing authority.

2.     Government Code Section 1126

     Next we consider the conflict of interest provisions of Government Code section 1126. This
statute generally prohibits local agency officers and employees from engaging in incompatible
employment for compensation. It states in part:

     "(a) Except as provided in Sections 1128 and 1129, a local agency officer or employee shall
not engage in any employment, activity, or enterprise for compensation which is inconsistent,
incompatible, in conflict with, or inimical to his or her duties as a local agency officer or
employee or with the duties, functions, or responsibilities of his or her appointing power or the
agency by which he or she is employed. . . .

      "(b) Each appointing power may determine, subject to approval of the local agency, and
consistent with the provisions of Section 1128 where applicable, those outside activities which,
for employees under its jurisdiction, are inconsistent with, incompatible to, or in conflict with
their duties as local agency officers or employees. . . ."

     The provisions of Government Code section 1126 are not self-executing; officers and
employees must first be given notice of the prescribed activities and intended disciplinary action
to be taken and appeals procedures available. (Mazzola v. City and County of San Francisco
(1980) 112 Cal.App.3d 141.) Furthermore, the statute is inapplicable to elected officials, since
they "have no appointing power other than the electorate . . . ." (64 Ops.Cal.Atty.Gen. 795, 800
(1981).)
     Hence, as an elected official (Gov. Code, § 25000), the county supervisor in question would
not be affected by Government Code section 1126. With regard to the position of secretary and
executive director, the housing authority commissioners have the discretion under the statute to
determine whether the person's duties as a county supervisor would be incompatible with his
duties as their employee.

3.     Government Code Section 1090

    The third issue to be considered is whether the terms of Government Code section 1090
would preclude a county supervisor from being named the secretary and executive director of a
county housing authority. This statute states in part:

    "Members of the Legislature, state, county, district, judicial district, and city officers or
employees shall not be financially interested in any contract made by them in their official
capacity, or by any body or board of which they are members. . . ."

In 66 Ops.Cal.Atty.Gen. 156, 157 (1983), we observed:

     "'Section 1090 of the Government Code codifies the common law prohibition and the
general policy of this state against public officials having a personal interest in contracts they
make in their official capacities. [Citations.] Mindful of the ancient adage, that "no man can
serve two masters" [citations], "a self-evident truth, as trite and impregnable as the law of
gravity" [citation], the section was enacted to insure that public officials "making" official
contracts not be distracted by personal financial gain from exercising absolute loyalty and
undivided allegiance to the best interest of the entity which they serve, and at least with respect
to those contracts, it does so by removing or limiting the possibility of their being able to bring
any direct or indirect personal influence to bear on an official decision regarding them.
[Citations.] The mechanism of the section is one of prohibiting public officials from being
personally financially interested as private individuals in any such contract. . . .'" Footnote No. 3

     We have previously concluded that public employment constitutes a "contract" within the
meaning of Government Code section 1090. (65 Ops.Cal.Atty.Gen. 305, 308, fn. 4 (1962); 36
Ops.Cal.Atty.Gen. 121 (1960).) Accordingly, a legislative body or other board or commission
could not appoint one of its own members to an employment position within the agency; the
board member would have a proscribed financial interest in receiving a salary as an employee.

    However, we do not have that situation here. Significantly, it is the housing authority
commissioners who would hire the supervisor as their employee. The commissioners act as an
administrative arm of the state in pursuing the state concern of developing new housing
opportunities. (Housing Authority v. City of L.A. (1982) 38 Cal.2d 853, 862.) The board of
supervisors is a separate body and has no role to play in the commissioners' hiring decisions. (§
34278.) Hence, it would be the housing authority, not the board of supervisors, that would
"make" the employment contract with the supervisor for purposes of Government Code section
1090. Footnote No. 4
     We considered a similar situation in 21 Ops.Cal.Atty.Gen. 90 (1953), where a city treasurer
contemplated the deposit of city funds in a bank partly owned by a city council member. Our
analysis was as follows:

     "The Attorney General has held that the fact that a person is a legislator does not prevent his
entry into contracts of sale with the State of California or its agencies, except that he may not
enter into a contract with the legislature itself (14 Ops. Cal. Atty. Gen. 78); that a head court
house gardener who owned a private nursery was not disqualified from selling nursery supplies
to the county of which he was an employee because of the discretion vested in the county
purchasing agent to conclude contracts for the county (3 Ops. Cal. Atty. Gen. 188); that a County
Supervisor is not precluded from contracting for construction work with a school district since
the contracts for school buildings or school construction are let by Boards of School Trustees
without control or supervision of the County Board of Supervisors (17 Ops. Cal. Atty. Gen. 44).
The significant fact in each of these opinions is the independent status of the party contracting on
behalf of the governmental agency.

     "The selection of the depository in the instant case is in the discretion of the City Treasurer
and not subject to the supervision or control of the City Council. It is true that the council is
responsible for the appointment and removal of the Treasurer, but the relationship between one
member of the council and the Treasurer is no less remote than that of a legislator and an agency
of the State Government.

      "We are of the opinion that the public funds of the City of Modesto may be deposited by the
City Treasurer in a bank in which a councilman of the city is a director and a stockholder with
less than 5% of the outstanding capital stock." (Id., at pp. 91-92.)

     Although here the members of the county housing authority commission are subject to
removal for cause by the board of supervisors (§ 34282), their independent contracting powers
would not be affected by such limited supervisorial control for purposes of Government Code
section 1090. (21 Ops.Cal.Atty.Gen., supra, at 92.) Accordingly, Government Code section 1090
would not prohibit a person from holding the two positions involved herein. Footnote No. 5

4.     Rule Against Self-Appointments

     In 23 Ops.Cal.Atty.Gen. 75, 75-77 (1954), we discussed at length the common law rule
against self-appointments. We stated in part:

       "There is no reported California case holding directly that an appointing board or
commission may not appoint one of its members to office. In most of the states, however, there is
a well-defined, court announced rule of public policy which prohibits a public board from
conferring an appointment on one of its own members. This is the rule against self-appointment.
. . . Authoritative legal texts pronounce the rule as one of general application. . . . It is referred to
as a rule of common law. . . .

     ". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
     " . . . In view of the overwhelming weight of judicial authority in other states and the
[favorable] dicta in the Thompson [55 Cal.App.2d 147] and Jensen [77 Cal.App.2d 921] cases,
we do not believe the California courts would reject the rule against self-appointments as an
expression of California public policy. . . ."

     While we reaffirm the validity of the common law proscription against self appointments in
California (See 76 Ops.Cal.Atty.Gen. 254, 256-259 (1993); 73 Ops.Cal.Atty.Gen. 357, 359-360
(1990)), this prohibition has no application here. Even if a housing authority secretary and
executive director holds a position subject to this rule, it is the housing authority commissioners
who make the appointment, not the county board of supervisors. As previously indicated, the
housing authority is a separate body and autonomous in its operations, with its own sources of
funding and areas of responsibility. (§§ 34310-34334.) We do not attribute the actions of the one
board to the other in such circumstances. Consequently, there would be no "self" in the
appointment of a county supervisor by a county housing authority commission.

5.     Rule Against Conflicts of Interest

    Finally, even if a statute does not prohibit a particular conflict of interest, consideration
must be given to the common law rule against such conflicts. (See Kuner v. Brea Redevelopment
Agency (1997) 55 Cal.App.4th 511, 519.) In Clark v. City of Hermosa Beach (1996) 48
Cal.App.4th 1152, 1171, the court observed:

     ". . . Actual injury is not the principle the law proceeds on. Fidelity in the agent is what is
aimed at, and as a means of securing it the law will not permit him to place himself in a position
in which he may be tempted by his own private interests to disregard those of his principal. This
doctrine is generally applicable to private agents and trustees, but to public officers it applies
with greater force, and sound policy requires that there be no relaxation of its stringency in any
case that comes within its reason. . . . [Citation.] '[T]he common law doctrine against conflicts of
interest . . . prohibits public officials from placing themselves in a position where their private,
personal interests may conflict with their official duties.' (64 Ops.Cal.Atty.Gen. 795, 797 (1981);
accord, 70 Ops. Cal.Atty.Gen. 45, 47 (1987).)" (Fn. omitted.)

     Thus, the county supervisor in question must not act officially when to do so would be to
his personal gain. For example, with respect to the board of supervisors appointing or removing
housing authority commissioners, he would have an obvious conflict of interest since the
commissioners set the terms and conditions of his employment as the secretary and executive
director of the housing authority. However, the board of supervisors may still act. The interested
supervisor would only be required to abstain in the matter, neither voting on it nor attempting to
influence the vote of the other members of the board. (See 78 Ops.Cal.Atty.Gen. supra, at 374;
73 Ops.Cal.Atty.Gen. 191, 196 (1990); 70 Ops.Cal.Atty.Gen. 157, 162 (1987); 26
Ops.Cal.Atty.Gen. 5, 7 (1955).).

     Unless the Legislature specifically prohibits the holding of a public office and public
employment at the same time (see, e.g., Ed. Code, §§ 35107, 72103; Gov. Code, §§ 53227-
53227.2), conflict of interest principles generally do not bar a person from holding two different
positions, instead requiring only abstention when a particular matter arises. (See Thompson v.
Call (1985) 38 Cal.3d 633, 645-647; Eldridge v. Sierra View Local Hospital Dist. (1990) 224
Cal.App.3d 311, 320-321; 73 Ops.Cal.Atty.Gen., supra, at 193-196.)

     In sum, we conclude that a county supervisor may be employed by a county housing
authority commission to serve as its secretary and executive director.

                                                     *****
Footnote No. 1
Section references are to the Health and Safety Code unless otherwise indicated.
Footnote No. 2
Alternatively, the board of supervisors may declare itself to be the commissioners of the authority (§ 34290), with a
separate housing commission (§ 34291) functioning in an advisory capacity (§ 34292).
Footnote No. 3
Section 34281 specifically prohibits a housing authority commissioner from having an interest in a housing project
or any property to be included in any project, or from having any interest in any contract for goods or services
relating to a housing project, with limited exceptions.
Footnote No. 4
In our 1978 letter opinion concluding that a county supervisor could serve as the executive secretary of a county
housing authority (Cal.Atty.Gen., Indexed Letter No. IL 78-102, supra), the housing authority's executive secretary
did not hold a salaried position, and we thus did not consider the application of Government Code section 1090.
Footnote No. 5
If the county, through its board of supervisors, were to propose entering into a contract with the county housing
authority (see § 34314), such contract would require examination in light of the requirements of Government Code
section 1090. (See, e.g., Gov. Code, § 1091.5, subd. (a)(9); 78 Ops.Cal.Atty.Gen., supra, at 369-370.)
