OPINION NUMBER - 029
ADOPTED - 1979/04/13
SUBJECT - Requirement to file Statement of Financial Interests - members and employees of Nebraska Mortgage Finance Fund.
REQUESTED BY: Terrence J. Ferguson
QUESTION: Whether the members and employees of the Nebraska Mortgage Finance Fund are required to file Statements of Financial Interests?
The Nebraska Mortgage Finance Fund was created in 1977 by the Nebraska Mortgage Finance Fund Act, Section 76-1601 et seq, R.S. Supp., 1978. Section 76-1607(1) creates the Fund, and specifies that it is to be "a body politic and corporate, not a state agency, but an independent instrumentality exercising essential public functions, . . ." The fund is composed of nine members, the director of Economic Development, the chairman of the Nebraska Investment Council and the director of Planning as ex-official members and six members appointed by the Governor.
Section 76-1604 is a legislative finding calling for the "creation of a governmental body . . .", and Section 76-1605, which is a further legislative finding, refers to alleviating certain conditions in the mortgage lending industry "through encouragement of private investment and stimulation of construction by a governmental body is a public purpose . . ." and that such activities are "proper governmental functions" and can best be accomplished "by the creation of a governmental body . . ."
The letter requesting the advisory opinion states that the Act created the fund for the purpose of providing funds for mortgage financing at reduced interest rates to Nebraska residents of low or moderate incomes, that the fund will provide residential housing for persons of low and moderate income through two programs. Under the "mortgage purchase" program, the fund will purchase or take assignments of mortgage loans made by mortgage lenders for the construction, rehabilitation or purchase of residential housing, and under the "loans to lenders" program, the fund will make loans to mortgage lending institutions which in turn will make mortgage loans to persons of low and moderate income. Loans made through the fund's programs will be at interest rates below conventional market rates. To obtain the monies that will be used to finance these mortgage loans, the fund will issue tax exempt revenue bonds which will bear interest at rates lower than the outstanding mortgages. The difference paid to the fund by mortgagors and interest paid by the fund to bondholders is expected to provide the necessary margin for the cost of operating the mortgage program authorized by the Act.
The Fund Act specifically provides that the fund may sue and be sued in its own name (Section 76-1618(3)), and that the bonds issued by the fund shall not constitute a debt, liability or general obligation of the state or a pledge of the faith and credit of the state.
Section 76-1615 provides that members and employees of the fund are subject to disclosing interests in transactions with the fund and upon such disclosure to not participate in any action by the fund authorizing such a transaction. Compare to Section 49-1499.
The issues to be resolved by this advisory opinion are whether or not the members of the commission are subject to the provisions of Section 49-1493, subdivision (7), which requires a member of a board or commission of the state or any county which examines or licenses a business, trade or profession, or which determines rates or otherwise regulates a business to file a Statement of Financial Interests, or to file a Statement of Financial Interests pursuant to the provisions of subdivision (10) of section 49-1493, which requires such a filing from an official or an employee of the state designated by rules and regulations of the commission, who is responsible for taking or recommending official action of a non-ministerial nature with regard to certain powers or actions. Subdivision (7) refers to a member of any board or commission of the state and subdivision (10) refers to an official or employee of the state.
Section 49-1424 defines governmental body to include political subdivisions of the state.
Section 49-1443 defines a public official as an official of a political subdivision of state government.
It is clear that the Fund, although declared not to be a state agency, is a body politic and corporate and a governmental body of the state. See Sections 76-1604, 76-1605 and 76-1607. In this sense it is not a board or commission of the state but like the University of Nebraska or a political subdivision. See Advisory Opinions No. 4 and 11. So under these circumstances the members of the Fund are not members of a board or commission of the state subject to subdivision (7).
In any case, as far as subdivision (7) is concerned, we have previously taken the position that the language "determines rates for or otherwise regulates a business" is limited to ratemaking power over other businesses as distinguished from the setting of rates for its own governmental business and the power to restrict or curtail the operation of such other businesses. See Advisory Opinions No. 4 and 9.
As far as subdivision (10) is concerned, Amended Commission Rule 2, adopted February 15, 1978, does not include the members of the Fund nor its employees as officials or employees of the state, and unless rules and regulations are adopted, after hearing, specifying that the members and employees of the Fund are required to file Statements of Financial Interests, there is no obligation to file under this subdivision of Section 49-1493.
It should be noted, however, that even though the members of the fund and the Fund's employees are officials and employees of a separate body politic and not a state agency and are therefore not subject to the disclosure requirements of the Nebraska Political Accountability and Disclosure Act, they are nevertheless subject to the prohibitions and other provisions of the Act such as are set forth in Sections 49-1498, by reason of the Fund's being a governmental body, 49-14,101 and 49-14,102, by reason of the members and employees of the fund being public officials and public employees (See Section 49-1424 and 49-1443), and in addition, of course, to the disclosure and prohibitions of Section 76-1615 of the Nebraska Mortgage Finance Fund Act itself.