September 29, 2005

Arnita Westphal
Iowa Racing and Gaming Commission
Iowa Department of Inspections and Appeals
PO Box 417, 99 Anti-Monopoly Street
Marquette, Iowa 52158

Dear Ms. Westphal:

This opinion is in response to your email of September 12, 2005, and subsequent emails, requesting an opinion from the Iowa Ethics and Campaign Disclosure Board pursuant to Iowa Code section 68B.32A(11) and Board rule 351—1.2. We note at the outset that the Board’s jurisdiction is limited to the application of Iowa Code chapters 68A and 68B, Iowa Code section 8.7, and rules in Iowa Administrative Code chapter 351. Advice in a Board opinion, if followed, constitutes a defense to a subsequent complaint based on the same facts and circumstances.

Factual statement:

You request this opinion in your capacity as a Gaming Representative with the Iowa Racing and Gaming Commission (IRGC) that is attached to the Iowa Department of Inspections and Appeals. You own residential property that you intend to lease at fair market value. The property is near the Isle of Capri (Capri), an entity subject to the regulatory authority of IRGC and possible renters include employees of Capri. While you currently do not directly regulate Capri, there is the potential that you could be asked to hear a case involving Capri. IRGC also submitted information stating situations when you might be asked to oversee Capri. In addition, references were made to internal IRGC work rules, the DIA Employee Handbook, and the State of Iowa Employee Handbook all of which discuss potential conflicts of interest and dealings with the regulated community.


Is it permissible for an employee of the Iowa Racing and Gaming Commission to lease residential property to an individual who works for a regulated entity?


We first note that this opinion will address both your question and the letter submitted by IRGC. If remaining issues need to be clarified for either you or IRGC, additional opinion requests may be submitted for the Board’s consideration.

We do not believe that this situation creates an impermissible conflict of interest under Iowa Code section 68B.2A so long as you do not use governmental resources for purposes of leasing your property.1 In addition, if an individual from the Isle of Capri were to rent your property, you would have to abstain from any actions involving that individual that came before IRGC.

As the Department of Inspections and Appeals is a “regulatory agency” as defined in Iowa Code section 68B.2(23), Iowa Code section 68B.4 and rule 351—6.11 also potentially apply to your question. Under that statute and rule, as an official or employee of a regulatory agency you cannot sell any “goods or services to individuals, associations, or corporations subject to the regulatory authority” of the Department of Inspections and Appeals except when you have obtained consent.

We do not believe that the leasing of rental property is a “sale” of a good or service. As such, Iowa Code section 68B.4 and rule 351—6.11 would not apply and you do not have to obtain consent prior to leasing the rental property to an individual employed with the Isle of Capri.

Apart from the situation you raise, the Board will be asking the General Assembly to amend Iowa Code section 68B.4 so that in the future leasing of an item will be a covered activity.

In closing, the Board notes that at this point in the process it is not speaking to any statements contained in IRGC work rules, the Department of Inspections and Appeals Handbook, or the State of Iowa Employee Handbook. 


James Albert, Board Chair 
Janet Carl, Vice Chair
Gerald Sullivan
Betsy Roe
John Walsh
Patricia Harper

Submitted by: W. Charles Smithson, Board Legal Counsel

1 For example, using your state phone and on state time to conduct business involving the residential property. This activity would also be a violation of the Board’s rule on the misuse of public property in 351—6.8.