Conflict of Interest: Two New and Critical Questions for Governing Body Members

If you are a municipal governing body or board member, you need to constantly assess potential conflicts of interest and whether you have a disqualifying interest that would prohibit you from considering a land use ordinance or application. Failure to do so could cause your municipality to be embroiled in litigation and can void the governing body’s or board’s decision on an ordinance or application.

This issue affects zoning and planning board and governing bodies, including councils and township committees. If you think to yourself, “Could I possibly have an interest in this application?” speak up and address it before any action is taken.

The Supreme Court of New Jersey recently considered when a governing body member’s affiliation with an entity in close proximity to property that is the subject of a land use dispute – such as a zoning application – has a disqualifying interest in that dispute.

In Grabowsky v. Township of Montclair, the Court addressed the following question:

Does a council member’s affiliation with a church located adjacent to a zoning applicant constitute a disqualifying interest in the zoning dispute? In this case, two members of the governing body were members of the church and had served in leadership positions for the church and were scheduled to begin terms as trustees.

The Court remanded the case to develop a more complete record of the governing body members’ involvement with the church in order to assess whether they had disqualifying indirect personal interests in the application. As part of its analysis, the court determined that any organization that owns property within a 200-foot radius of the disputed property has an interest in the application. It based this radius on the land use laws that require notice to property owners within 200 feet. The Court then considered whether the church’s interests should be imputed to the governing body members. It rejected the decisions of lower courts that imputed an organization’s interests to all of its members. Instead, it called for a fact-specific, case-by-case analysis.

In light of this decision, here are two additional conflict of interest questions governing body or board members should ask themselves before hearing a land dispute:

  1. Are you affiliated with any organization that owns property within 200 feet of the property subject to the application?
  2. If yes, then, do you hold or will you imminently hold a “position of substantive leadership in [the] organization”?

a. If yes, then you would have a disqualifying indirect personal interest and should not deliberate or vote on the application.
b. If no, are the unique facts and circumstances of your affiliation with the organization such that you have an active involvement with the group or its legal positions?

i. If yes, then you may have a disqualifying indirect personal interest.
ii. If no, then you likely do not have a disqualifying indirect personal interest.

Public officials do not need to go it alone. When in doubt, raise any potential disqualifying interest with your attorney so that the integrity of the local government process if protected.

Author:  Rebecca Carvalho