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Pecuniary Interest FAQ 2
May a mayor who owns the only automobile dealership in the city sell police squad cars to the city?
Generally speaking, the answer is no with
a limited exception. The governing body member risks committing a
felony if he or she sells cars to the municipality. Indeed, the officer
would be in danger of committing a felony simply by submitting price
quotes or a bid to the municipality. Wis. Stat. sec. 946.13 generally
prohibits municipal officials from having a private financial interest
in a public contract. As a result, local officials are generally
prohibited from entering into a contract for goods, services,
construction or employment with the municipality.
Specifically, sec. 946.13(1)(b) provides
that a public official may not participate in the making of a contract
in his or her official capacity if the official has a direct or indirect
financial interest in the contract. Since this is a prohibition on
official action, abstaining from voting on the contract will prevent
violation.
However, sec. 946.13(1)(a) provides that a
public official may not in his or her private capacity negotiate or bid
for or enter into a contract in which the public official has a direct
or indirect financial interest if the official is authorized or required by law to
participate in his capacity as such officer or employee in the making
of that contract. This latter provision is a prohibition on private
action. A public official cannot avoid violating it merely by abstaining
from voting. All that is necessary for a violation to occur is that the
official be authorized to vote on or exercise discretion with regard to
a contract in which the official has a private financial interest and
the official has negotiated, bid for, or entered into the contract.