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HomeMy WebLinkAbout08-531 ConfidentialADVICE OF COUNSEL April 4, 2008 08 -531 This responds to your letter dated February 21, 2008, received February 28, 2008, by which you requested a confidential advisory from the Pennsylvania State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa. .S. § 1101 et seq., would present any prohibitions or restrictions upon an A of a [political subdivision] [governmental body], who is an intervenor in litigation pertaining to a G dispute between the [political subdivision] and a business located in the [political subdivision], with regard to: (1) being present in [governmental body] executive sessions where matters pertaining to such litigation would be discussed; or (2) publicly discussing issue(s) pertaining to a Consent Order in the litigation or the cost of the litigation to the taxpayers. Facts: As an A of Governmental Body B for Political Subdivision C, you have requested a confidential advisory from the Pennsylvania State Ethics Commission based upon submitted facts that may be fairly summarized as follows. On [date], Political Subdivision C issued Ds to the owners of a business in Political Subdivision C named [name of Business E]. You are the owner of a property that is located [distance] from Business E. You state that you became an intervenor in hearings before the Political Subdivision C F Board in [year] and [year], which hearings pertained to Ds issued to Business E. You have submitted a copy of an undated decision of the F Board denying an appeal of Business E and its owners from a D issued by Political Subdivision C in [year], which document is incorporated herein by reference. You have also submitted a copy an unreported opinion issued by the Commonwealth Court of Pennsylvania on [date], Docket Numbers [docket numbers], which is incorporated herein by reference. It is administratively noted that in the aforesaid judicial opinion, the Commonwealth Court upheld your status as an intervenor in the G dispute (hereinafter referred to as the Litigation") between the owners of Business E and Political Subdivision C. Additionally, Commonwealth Court vacated a Consent Order (the "Consent Order ") issued by the Court of Common Pleas of H County on [date]. The Consent Order had adopted a consent agreement between the owners of Business E and Political Subdivision C in settlement of the Litigation. Commonwealth Court Confidential Advice, 08 -531 April 4, 2008 Page 2 vacated the Consent Order because you were not a party to the Consent Order. The Commonwealth Court decision reflects that certain other property owners near Business E could potentially be permitted to intervene in the Litigation. Commonwealth Court remanded the matter to the trial court for further proceedings. B. In [month, year], you were sworn in as a newly elected A of Governmental Body Based upon the above submitted facts, you pose the following specific questions: 1. Whether, as an A of Governmental Body B, you could be present in Governmental Body B executive sessions where matters pertaining to the Litigation would be discussed; 2. Whether a record would have to demonstrate bias, prejudice, capricious disbelief, or prejudgment before it could be said that a member of a local governing body performing a quasi - judicial function should have recused himself from hearing a case, and if such a member believed that he could hear a case fairly, whether the member's decision to not withdraw from hearing the case would ordinarily be upheld on appeal; 3. Whether the Pennsylvania Supreme Court's decision in [cite] would be applicable to the instant matter; 4. Whether, as an intervenor in the Litigation, you could publicly discuss issue(s) pertaining to the Consent Order or the cost of the Litigation to the taxpayers; and 5. Whether there would be any other advice or opinion that could be helpful in the instant matter. Discussion: It is initially noted that pursuant to Sections 1107(10) and 1107(11) of the Ethics Act, 65 Pa.C.S. §§ 1107(10), (11), advisories are issued to the requester based upon the facts that the requester has submitted. In issuing the advisory based upon the facts that the requester has submitted, the Commission does not engage in an independent investigation of the facts, nor does it speculate as to facts that have not been submitted. It is the burden of the requester to truthfully disclose all of the material facts relevant to the inquiry. 65 Pa.C.S. §§ 1107(10), (11). An advisory only affords a defense to the extent the requester has truthfully disclosed all of the material facts. As an A of Governmental Body B for Political Subdivision C, you are a public official subject to the provisions of the Ethics Act. Sections 1103(a) and 1103(j) of the Ethics Act provide: § 1103. Restricted activities (a) Conflict of interest. - -No public official or public employee shall engage in conduct that constitutes a conflict of interest. (j) Voting conflict. - -Where voting conflicts are not otherwise addressed by the Constitution of Pennsylvania or by any law, rule, regulation, order or ordinance, the following procedure shall be employed. Any public official or public employee who in the discharge of his official duties would be required to vote on a matter that would result in a conflict of interest shall abstain from voting and, prior to the vote being Confidential Advice, 08 -531 April 4, 2008 Page 3 taken, publicly announce and disclose the nature of his interest as a public record in a written memorandum filed with the person responsible for recording the minutes of the meeting at which the vote is taken, provided that whenever a governing body would be unable to take any action on a matter before it because the number of members of the body required to abstain from voting under the provisions of this section makes the majority or other legally required vote of approval unattainable, then such members shall be permitted to vote if disclosures are made as otherwise provided herein. In the case of a three - member governing body of a political subdivision, where one member has abstained from voting as a result of a conflict of interest and the remaining two members of the governing body have cast opposing votes, the member who has abstained shall be permitted to vote to break the tie vote if disclosure is made as otherwise provided herein. 65 Pa.C.S. §§ 1103(a), (j). The following terms are defined in the Ethics Act as follows: § 1102. Definitions "Conflict" or "conflict of interest." Use by a public official or public employee of the authority of his office or employment or any confidential information received through his holding public office or employment for the private pecuniary benefit of himself, a member of his immediate family or a business with which he or a member of his immediate family is associated. The term does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. "Authority of office or employment." The actual power provided by law, the exercise of which is necessary to the performance of duties and responsibilities unique to a particular public office or position of public employment. 65 Pa.C.S. § 1102. Pursuant to Section 1103(a) of the Ethics Act, a public official /public employee is prohibited from using the authority of public office /employment or confidential information received by holding such a public position for the private pecuniary benefit of the public official /public employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. The use of authority of office is not limited merely to voting, but extends to any use of authority of office including, but not limited to, discussing, conferring with others, and lobbying for a particular result. Juliante, Order 809. The above statutory definition of "conflict" or "conflict of interest" contains two exclusions, referred to herein as the "de minimis" exclusion and the "class /subclass Confidential Advice, 08 -531 April 4, 2008 Page 4 exclusion." The de minimis exclusion precludes a finding of conflict of interest as to an action having a de minimis (insignificant) economic impact. Thus, when a matter that would otherwise constitute a conflict of interest under the Ethics Act would have an insignificant economic impact, a conflict would not exist and Section 1103(a) of the Ethics Act would not be implicated. See, Kolb, Order 1322; Schweinsburq, Order 900. In order for the class /subclass exclusion to apply, two criteria must be met: (1) the affected public official /public employee, immediate family member, or business with which the public official /public employee or immediate family member is associated must be a member of a class consisting of the general public or a true subclass consisting of more than one member; and (2) the public official /public employee, immediate family member, or business with which the public official /public employee or immediate family member is associated must be affected "to the same degree" (in no way differently) than the other members of the class /subclass. 65 Pa.C.S. § 1102; see, Kablack, Opinion 02 -003; Graham, Opinion 95 -002 (citing Van Rensler, Opinion 90- 017); Rubenstein, Opinion 01 -007. The first criterion of the exclusion is satisfied where the members of the proposed subclass are similarly situated as the result of relevant shared characteristics. The second criterion of the exclusion is satisfied where the individual /business in question and the other members of the class /subclass are reasonably affected to the same degree by the proposed action. Kablack, supra. In each instance of a voting conflict, Section 1103(j) of the Ethics Act requires the public official /public employee to abstain and to publicly disclose the abstention and reasons for same, both orally and by filing a written memorandum to that effect with the person recording the minutes. In the event that the required abstention results in the inability of the governmental body to take action because a majority is unattainable due to the abstention(s) from conflict under the Ethics Act, then voting is permissible provided the disclosure requirements noted above are followed. See, Pavlovic, Opinion 02 -005. In applying the above provisions of the Ethics Act to your inquiry, you are advised that generally, where a public official is involved in litigation, matters pertaining to or affecting the litigation or a party to the litigation present a conflict of interest for the public official. See, DeLano, Opinion 88 -008; Golla, Opinion 88 -004; cf., McCullough, Advice 07- 534; —waft, Advice 07 -524; Hiscott, Advices 06 -517 and 06- 517 -S. Even where litigation would not be a factor, a public official would have a conflict of interest under Section 1103(a) of the Ethics Act in matters that would financially impact the public official, a member of his immediate family, or a business with which he or a member of his immediate family is associated, unless the de minimis exclusion or the class /subclass exclusion would be applicable. In the instant matter, there is an insufficient factual basis for determining whether the class /subclass exclusion would be applicable. From the submitted facts, it is not known whether other neighboring property owners will ultimately intervene in the Litigation or whether such potential intervenors will be affected to the same degree as you will be affected by any particular matter coming before you in your public capacity. Therefore, you are advised that you would have a conflict of interest in matters before Political Subdivision C involving the Litigation, the owners of Business E, or Business E itself, except to the extent the de minimis exclusion or the class /subclass exclusion would be applicable. See, DeLano, supra; Golla, supra; Hadley, Advice 07- 608. In each instance of a conflict, you would be required to abstain fully from participation and in the instance of a voting conflict, to fully abstain and satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. Confidential Advice, 08 -531 April 4, 2008 Page 5 In response to your first specific inquiry, you are advised that due to your status as an intervenor in the Litigation, pursuant to Section 1103(a) of the Ethics Act, you would be prohibited from being present in Governmental Body B executive sessions while matters pertaining to the Litigation would be discussed. Cf., Van Rensler, Opinion 90 -017 (Holding that the Ethics Act would prohibit school directors from participating on a negotiating team for a collective bargaining agreement where members of their immediate families were school district employees who were represented by the bargaining units; in part, this was so that the potential for the use of confidential information would be 'minimized if not eliminated." Id., at 4 -5.). As to your second and third specific inquiries, the questions that you have posed do not fall within the jurisdiction of the State Ethics Commission as they do not involve an interpretation of the Ethics Act. Because the State Ethics Commission does not issue general legal advice on matters not within its statutory jurisdiction, your second and third specific inquiries cannot be addressed in this advisory. As to your fourth specific inquiry, you are advised that generally, to the extent you would publicly discuss issues pertaining to the Consent Order in the Litigation or the cost of the Litigation to the taxpayers, while acting in your official capacity as an A of Governmental Body B for Political Subdivision C, such actions would be considered a use of authority of office and, depending upon the circumstances, could form the basis for a conflict of interest pursuant to Section 1103(a) of the Ethics Act. However, Section 1103(a) of the Ethics Act would not prohibit you from publicly discussing the aforesaid issues in your private capacity as a citizen, subject to the condition that your conduct /communications would clearly and unequivocally establish that you would be acting in your private capacity rather than in your public capacity as an A of Governmental Body B for Political Subdivision C. Cf., Braun, Advice 00 -633. In response to your fifth specific inquiry, based upon the facts that have been submitted, this Advice has addressed the applicability of Sections 1103(a) and 1103(j) of the Ethics Act only. For legal advice beyond the scope of the Ethics Act, it is suggested that you consult with an attorney. The ropriety of the proposed conduct has only been addressed under the Ethics Act. Specifically not addressed herein is the applicability of the I or case law as to bias. Conclusion: As an A of Governmental Body B for Political Subdivision C, you are a public official subject to the rovisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et se q. Based upon the submitted facts that you are an intervenor in litigation ( "the Litigation") pertaining to a G dispute between Political Subdivision C and Business E, a business located in Political Subdivision C, you are advised as follows. You would have a conflict of interest in matters before Political Subdivision C involving the Litigation, the owners of Business E, or Business E itself, except to the extent the de minimis exclusion or the class /subclass exclusion would be applicable. In each instance of a conflict, you would be required to abstain fully from participation and in the instance of a voting conflict, to fully abstain and satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. Due to your status as an intervenor in the Litigation, pursuant to Section 1103(a) of the Ethics Act, you would be prohibited from being present in Governmental Body B executive sessions while matters pertaining to the Litigation would be discussed. Generally, to the extent you would publicly discuss issues pertaining to a Consent Order in the Litigation or the cost of the Litigation to the taxpayers, while acting in your official capacity as an A of Governmental Body B for Political Subdivision C, such actions would be considered a use of authority of office and, depending upon the circumstances, could form the basis for a conflict of interest pursuant to Section 1103(a) of the Ethics Act. However, Section 1103(a) of the Ethics Act would not prohibit you from publicly discussing the aforesaid issues in your private capacity as a citizen, subject to the condition that your conduct /communications would clearly and unequivocally establish that you would be acting in your private Confidential Advice, 08 -531 April 4, 2008 Page 6 capacity rather than in your public capacity as an A of Governmental Body B for Political Subdivision C. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Pursuant to Section 1107(11), an Advice is a complete defense in any enforcement proceeding initiated by the Commission, and evidence of good faith conduct in any other civil or criminal proceeding, provided the requester has disclosed truthfully all the material facts and committed the acts complained of in reliance on the Advice given. This letter is a public record and will be made available as such. Finally, if you disagree with this Advice or if you have any reason to challenge same, you may appeal the Advice to the full Commission. A personal appearance before the Commission will be scheduled and a formal Opinion will be issued by the Commission. Any such appeal must be in writing and must be actually received at the Commission within thirty (30) days of the date of this Advice pursuant to 51 Pa. Code § 13.2(h). The appeal may be received at the Commission by hand delivery, United States mail, delivery service, or by FAX transmission (717 - 787 - 0806). Failure to file such an appeal at the Commission within thirty (30) days may result in the dismissal of the appeal. Sincerely, Robin M. Hittie Chief Counsel