Public Officials on Boards: Nonprofit Addresses Conflict Concerns

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City Hall
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January 21, 2013; Source: Press-Enterprise

When does having politicians on a nonprofit board make the board a political body? Tracking conflicts of interest and being accountable to the community are two issues important to governments and nonprofits alike. When local politicians are also nonprofit board members, it’s especially important to abide by all the rules.

Two members of the Menifee, Calif. City Council are also board members of a local nonprofit, the Quail Valley Environmental Coalition. The Coalition was formed a few years ago to address sewage-related problems in area communities by seeking grant funds unavailable to municipal governments. In fact, several local governments each provided $10,000 in seed money to start the nonprofit. Other board members of the Coalition are also members of local governments in the area.

There were concerns that having more than one Menifee City Council member on the nonprofit’s board made the nonprofit subject to the Brown Act, a California law designed to assure open meetings with written agendas and community accountability for state and local governments. The Menifee city attorney reviewed the law and determined that the two council members did not serve on the nonprofit’s board as part of their City Council duties and that city government in no way regulated the actions of the nonprofit.

What is so good about this story is that the issue was raised and addressed in an open manner. Clarification of roles and authority helps resolve many questions of conflict of interest and fiduciary duty. However, the Menifee story is also a cautionary tale about the issues nonprofits need to address when soliciting public officials to join their boards. Many nonprofit board members have other roles in society; some roles, like being a public official, may be impossible to leave at the boardroom door. –Michael Wyland