If a retired Idaho teacher still receives district-paid health insurance under an early-retirement program and then gets elected to her old school district's board of trustees, can she actually serve?

Plain-English summary

State Superintendent Jerry Evans asked the AG a focused question that arose in Bear Lake County: Norinne Kunz, a retired teacher, was elected on May 18, 1993, to serve as a Bear Lake School District trustee. Under the district's early-retirement program (part of the master agreement with the Bear Lake Education Association), Kunz had been receiving district-paid health insurance since September 1992 and was scheduled to continue through December 24, 1995. The 1993-94 cost to the district for her benefit was $4,831.20. The board of trustees votes on changes to the master agreement and on the total budget allocation for insurance, including coverage for early retirees. Could Kunz actually serve while she was still receiving the benefit?

The AG (writing for AG Larry EchoHawk) said no. Idaho Code § 33-307 and § 33-507 disqualify a school trustee from holding office if the trustee has a "direct or indirect pecuniary interest" in any contract with the school district. Kunz had a clear pecuniary interest in the district's insurance contract: she was a beneficiary of it. The fact that the trustees collectively vote on the insurance contract every year (changes to coverage, budget allocations) meant her vote, or her presence on the board, would create a recurring conflict.

The opinion rejected the workaround of declaring a conflict and abstaining from individual votes. Idaho's pecuniary-interest statute imposes a categorical bar on holding office, not a soft conflict-management rule. The trustee with a pecuniary interest may not serve, period, while the interest persists. Once the early-retirement benefits ended (December 24, 1995, in Kunz's case), the disqualification ended too. But for the period of overlapping benefit-and-office, she was disqualified from serving as a trustee.

Currency note

This opinion was issued in 1993. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Why isn't recusing from the votes enough?

Because Idaho's school-trustee statute imposes a status-based disqualification, not a vote-by-vote conflict-management rule. § 33-507 (and § 33-307) bar the trustee from holding the office at all while the pecuniary interest persists. The legislature took the view that a trustee with a financial stake in district contracts cannot fairly be entrusted with district decision-making, even if the trustee abstains from individual votes. Some other public-office statutes use a softer recusal model; Idaho's school-trustee provisions do not.

What counts as a "pecuniary interest"?

A direct interest is an ownership stake, a salary, or a benefit paid by the district to or for the trustee. An indirect interest is a benefit that runs to a closely related party (a spouse, a household member, a closely held business). Receiving district-paid health insurance under an early-retirement program is a direct pecuniary interest. The trustee is the named beneficiary; the cost runs against the district's budget; the trustee's continued benefit depends on the board's decisions about the insurance contract and the master agreement.

Does this rule apply to current employees of the district?

In broad strokes, yes. A current district employee who is also elected as a trustee would face a similar pecuniary-interest issue (the employee receives a salary from the district, and the trustees vote on the budget that includes that salary). Idaho practice and statute generally bar a person from serving as a trustee of the district that employs them. Some states allow current-employee trustees with recusal; Idaho does not.

Can the disqualified trustee return to office once the benefit ends?

Yes. The disqualification persists only while the pecuniary interest persists. Once the early-retirement health insurance benefit ended on December 24, 1995, Kunz could in principle have served as a trustee from that point forward (assuming she remained a qualified elector and otherwise eligible). The opinion does not address what happens to votes the trustee participated in during the disqualified period, or to the office itself if the trustee held it without legal authority.

What should a school district do if it discovers a sitting trustee has a pecuniary interest?

The school district's clerk and superintendent should consult district counsel immediately. Possible steps include: (1) the trustee resigning, (2) the trustee terminating the conflicting interest (where possible), or (3) the district initiating a removal proceeding if the trustee will not resign. Decisions made by a board with a disqualified member sitting may be subject to challenge, so prompt action matters. Insurance carriers and district auditors will also want to see clear documentation that the conflict has been resolved.

Background and statutory framework

Idaho Code § 33-307 sets out qualifications for school trustees and includes the pecuniary-interest disqualification. § 33-507 reinforces the disqualification with respect to contract-related interests. The two sections work together to keep trustees free of financial entanglement with the district they govern.

The constitutional backdrop is the broader principle that elected officials should be free of conflicts of interest in matters they vote on. Idaho applies this principle through specific statutes (like § 33-307 for school trustees, art. 18, § 6 for county officers) and through general anti-corruption rules. The school-trustee version is unusually categorical: status-based disqualification rather than vote-based recusal. The legislature evidently concluded that school district contracting is sensitive enough to warrant the stricter rule.

Citations

• Idaho Code §§ 33-307, 33-507

Source

• Landing page: https://www.ag.idaho.gov/office-resources/opinions/
• Original PDF: https://ag.idaho.gov/content/uploads/2018/04/OP93-10.pdf

Original opinion text

ATTORNEY GENERAL OPINION NO. 93-10
To:

Honorable Jerry L. Evans
State Superintendent of Public Instruction
STATEHOUSE MAIL

Per Request for Attorney General's Opinion
QUESTIONS PRESENTED
1.

Does a school trustee have a direct or indirect pecuniary interest, pursuant to Idaho
Code § 33-307, in the school district's contract with a health insurance company-over which trustees exercise some decision-making authority--if she is also a
former school teacher receiving health insurance benefits from that company as
part of the district's retirement program?

2.

If a pecuniary interest exists, may the individual declare her conflict of interest and
disqualify herself from discussing or voting on the contract, or is the individual
precluded from serving as duly elected trustee for that same school district?
CONCLUSION

1.

An individual who benefits from a contract between an insurance company and a
school district has a pecuniary interest in that contract.

2.

Pursuant to Idaho Code § 33-507, an individual with a pecuniary interest in a
contract with the school district may not be a trustee of that school district if the
individual continues to receive benefits under the contract.
ANALYSIS
I. Facts

Norinne Kunz is a retired Bear Lake School District teacher who was elected on
May 18, 1993 to serve as a trustee for that school district. In the spring of 1992, Ms.
Kunz took advantage of an "early retirement" incentive program. As part of Bear Lake
School District's master agreement with the Bear Lake Education Association, the "early
retirement" program provides that the former employee and his or her spouse receive
health insurance until the former employee reaches the age of 65. Before a change to the
master agreement can occur, the entire board of trustees must vote on making the
changes. The board further votes on the total budget allocation for insurance, including
the insurance for the school district's early retirees.

Ms. Kunz began receiving the insurance coverage benefit on September 1, 1992
and is scheduled to continue receiving this coverage until December 24, 1995. The cost
to the school district for the 1993-94 school year for this benefit is $4,831.20.
Your question is whether Ms. Kunz can serve as a trustee on the school district
board while at the same time receiving benefits from an insurance contract administered
by that same board. We conclude that she may not.
II. Discussion
A.

The Board of Trustees Statute

The statute that deals specifically with the limitation on the authority of trustees is
Idaho Code § 33-507, which states in pertinent part:
It shall be unlawful for any trustee to have pecuniary interest directly or
indirectly in any contract or other transaction pertaining to the maintenance
or conduct of the school district, or to accept any reward or compensation
for services rendered as a trustee.
This section provides that no member of the board of trustees may personally have
a monetary interest in any contract pertaining to the maintenance or conduct of the school
district. This is true regardless of whether the interest is direct or indirect.
An Attorney General's Legal Guideline issued September 11, 1981, held it would
violate Idaho Code § 33-507 for a school district to pay health insurance premiums for its
school board of trustees members:
[A] persuasive argument can be developed for the position that members of
a school board of trustees would have at least an indirect pecuniary interest
in the contract between the district and an insurance company under
circumstances where the district would provide for the payment of health
insurance premiums for its trustees. Such a situation clearly would be in
violation of the letter and intent of Idaho Code § 33-507 and provides
further support for the conclusion that participating school districts should
be advised to weigh carefully a decision to continue such a practice.
The facts set forth above suggest that, in light of the 1981 Attorney General's
Legal Guideline, should Ms. Kunz take the position of trustee of the Bear Lake School
District, she would have a pecuniary interest in a contract pertaining to the conduct or
maintenance of the school district, which is prohibited pursuant to Idaho Code § 33-507.

B.

The Ethics in Government Act

The other statute that is arguably applicable in this situation is Idaho's Ethics in
Government Act, Idaho Code §§ 59-701 through 59-706. This act, as passed by the
Idaho Legislature in 1990, deals with conflicts of interest for all persons in government
positions in Idaho. Key to the act is the requirement that a public official with a real or
potential conflict must disclose that conflict prior to acting on the matter. The public
official may obtain an advisory opinion from private counsel, from an attorney
representing the school district, or, in this case, from the attorney general. The individual
may then act on that advice.
The act further defines a conflict of interest as:
[A]ny official action or any decision or recommendation by a person acting
in a capacity as a public official, the effect of which would be to the private
pecuniary benefit of the person or a member of the person's household, or a
business with which the person or a member of the person's household is
associated . . . .
Idaho Code § 59-702(4). Thus, the Ethics in Government Act, originally enacted in
1990, paralleled the provisions of Idaho Code § 33-507 and identified a "conflict of
interest" as any situation in which a public official participates in a decision affecting a
contract involving his or her own private pecuniary benefit.
In 1992, through Senate Bill 1440, the Idaho Legislature amended the Ethics in
Government Act by adding a new section, Idaho Code § 59-704A, which states:
When a person is a public official by reason of his appointment or
election to a governing board of a governmental entity for which the person
receives no salary or fee as compensation for his service on said board, he
shall not be prohibited from having an interest in any contract made or
entered into by the board of which he is a member, if he strictly observes
the procedures set out in section 18-1361A, Idaho Code.
According to the Statement of Purpose to Senate Bill 1440, the new section 59704A was intended to "make an exception to the prohibition against contracts section of
the code and the ethics in government section for unpaid elected or appointed official
[sic]." It was further stated in the Senate State Affairs Committee that the bill was
"especially for Hospital Boards who have no compensated board members but would also
apply to any non compensated public servants." Thus, it could be argued the legislature
meant to apply Idaho Code § 59-704A to all non-compensated elected and appointed

officials. School board trustee members fall within the category of non-compensated
elected officials pursuant to Idaho Code § 33-507 and, therefore, would not be
prohibited from having an interest in any contract made or entered into by the school
board.
C.

Reconciling the Two Statutes

The 1993 legislature did not repeal Idaho Code § 33-507. This section, governing
the conduct of local school board trustees, has been in its present form since 1963.
Similar language can be traced back to the Revised Statutes of Idaho Territory, title III,
chapter VI, section 665 (1887), which stated:
Sixth. Said Trustees have further power when directed by a vote of
their district to purchase, receive, hold, and convey real and personal
property for school purposes, and to hold, purchase, hire, and repair school
houses, and supply the same with necessary furniture in accordance with
the provisions of this Title and to fix the location of school houses:
Provided, that no Trustee shall be pecuniarily interested in any contract
made by the Board of Trustees of which he is a member, and any contract
made in violation of this section is null and void . . . .
Id. at 129 (emphasis added).
As a general rule, the legislature is presumed to envision the whole body of the
law when it enacts new legislation. Furthermore, this presumption has been held to have
special application to important public statutes of long standing. Doe v. Durtschi, 110
Idaho 466, 478, 716 P.2d 1238, 1250 (1986). The Idaho courts will only find an implied
repeal when new legislation is irreconcilable with and repugnant to a preexisting statute.
Id. The Idaho Supreme Court has further held that "[t]he legislature is presumed not to
intend to overturn long established principles of law unless an intention to do so plainly
appears by express declaration or the language employed admits of no other reasonable
construction." George W. Watkins Family v. Messenger, 118 Idaho 537, 540, 797 P.2d
1385, 1388 (1990) (emphasis added).
Idaho Code § 33-507 is an important public statute of long standing which the
legislature cannot be presumed to have intended to amend or repeal without specific
mention. The Idaho Legislature did not make an express declaration that Idaho Code
§ 33-507 was to be repealed upon the enactment of Idaho Code § 59-704A. While
Idaho Code § 33-507 is more prohibitive than the amended version of Idaho Code § 59704A, it is not irreconcilable or repugnant.

Yet another principle of statutory construction invoked when statutes appear to be
in conflict with one another holds that a specific statute controls over a more general
statute when there is any conflict. Guillard v. Dept. of Employment, 100 Idaho 647, 603
P.2d 981 (1979); Swisher v. State Dept. of Environmental and Community Services, 98
Idaho 565, 569 P.2d 910 (1977).
Idaho Code § 330507 deals specifically with the limitations of authority of the
local board of trustees of each school district and is more restrictive than the Ethics in
Government Act. If a conflict of interest of an individual exists under Idaho Code § 33507 but does not exist under the Ethics in Government Act, the conflict of interest is still
present and is not cured by the terms of the Ethics in Government Act.
We conclude that the specific provisions of the school board trustees law, Idaho
Code § 33-507, take precedence over the general conflict of interest law found in the
Ethics in Government Act.
III. Conclusion
Idaho Code § 33-507 prohibits a member of the board of trustees of a school
district from receiving a personal pecuniary benefit from a contractual relationship
between the school district and the teachers' association. Idaho Code § 33-507 is
absolute and provides no leeway or exceptions to the prohibition of pecuniary interest.
There is no provision that allows a trustee to simply declare the conflict of interest and
disqualify herself or himself from discussing or voting on the insurance benefits issue. A
trustee member cannot have a personal interest in any contract made by the board of
trustees. Thus, Idaho Code § 33-507 prohibits Ms. Kunz from becoming a trustee if she
continues to receive the insurance benefits set forth in the master agreement with the
teacher's association.
AUTHORITIES CONSIDERED
1.

Idaho Code:
§ 33-507.
§§ 59-701 through 706.

2.

Idaho Cases:
Doe v. Durtschi, 110 Idaho 466, 716 P.2d 1238 (1986).
George W. Watkins Family v. Messenger, 118 Idaho 537, 797 P.2d 1385 (1990).

Guillard v. Dept. of Employment, 100 Idaho 647, 603 P.2d 981 (1979).
Swisher v. State Dept. of Environmental and Community Services, 98 Idaho 565,
569 P.2d 910 (1977)
3.

Other Authorities:
Attorney General's Legal Guideline issued September 11, 1981.
Revised Statutes of Idaho Territory, title III, chapter VI, section 665 (1887).
DATED this 22nd day of September, 1993.
LARRY ECHOHAWK
Attorney General

Analysis by:
ELAINE EBERHARTER-MAKI
Deputy Attorney General