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HomeMy WebLinkAbout09-516 CONFIDENTIALADVICE OF COUNSEL [date]. March 9, 2009 09 -516 This responds to your letter dated January 22, 2009, 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 impose any restrictions upon employment of the A of Commonwealth Department B following termination of Commonwealth service. Facts: As the legal representative of Individual C, you have been authorized to request an advisory from the Pennsylvania State Ethics Commission on his behalf. You have submitted extensive facts that may be fairly summarized as follows. Individual C served as the A of Commonwealth Department B from [date] until The A of Commonwealth Department B or the A's designee serves as a member of various boards and commissions within Commonwealth Department B. In addition, the A of Commonwealth Department B, either directly or through an alternate or designee, serves in his official capacity as a member of numerous entities outside of Commonwealth Department B, including boards, commissions, councils, task forces, and committees, which bodies you state have been established by legislation or executive order or as informal administrative organizations. You have submitted a copy of a list of [number] such "outside" entities on which the A of Commonwealth Department B serves in his official capacity, which document is incorporated herein by reference. In addition, you have submitted a copy of an organization chart for Commonwealth Department B, which document is also incorporated herein by reference. The A of Commonwealth Department B is responsible for [types of responsibilities]. Commonwealth Department B administers numerous [types of programs] or is involved in its representative capacity in the D of E by boards, commissions, and other entities. The A of Commonwealth Department B may participate in efforts to [attain certain goals through particular means]. You have submitted a description of the programs administered by Commonwealth Department B, which programs fall into the following broad categories: [list of categories]. You state that with respect to E through Commonwealth Department B, Commonwealth Department B staff evaluate applications for E and make Confidential Advice, 09 -516 March 9, 2009 Page 2 recommendations to their superiors, who in turn make recommendations to the A of Commonwealth Department B. With respect to E by boards, commissions, and other entities on which Commonwealth Department B participates in a representative capacity, a D of E is made based upon the requisite vote of the members. You state that Individual C is considering potential employment as the F of the [name of organization] (hereinafter referred to as "Organization G"). Organization G is a Pennsylvania non - profit corporation with the specific purposes of: [enumerated purposes]. You have submitted a copy of Organization G's By -laws. The F is responsible for all of the affairs of Organization G and is under the direction of Organization G's Board of Directors ( "the Board "). The Directors represent [types of entities]. The F serves as an ex- officio member of the Board. You state that Organization G staffs the [number] Organization G affiliates, which are: [list of affiliates]. Each of the aforesaid affiliates has a Board of Directors. The majority of Organization G's budget is funded through contributions from [name of organization], which is comprised of various entities. Some funding is also received from the state and federal governments. You state that during Individual C's tenure as A, Commonwealth Department B awarded Hs, Is, or other types of E to Organization G and two of the Organization G affiliates, specifically, [names of affiliates]. You state that none of the aforesaid E was for the purposes of [types of purposes]. You state that the extent of Individual C's involvement in the D of this E was generally to rely on the recommendations of subordinates to approve the necessary documents, and in some cases, to communicate with staff of Organization G. Based upon the above submitted facts, you ask whether the Ethics Act would impose any prohibitions or restrictions upon Individual C with regard to his prospective employment as the F of Organization G. 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. It is further initially noted that, pursuant to the same aforesaid Sections of the Ethics Act, an opinion /advice may be given only as to prospective (future) conduct. If the activity in question has already occurred, the Commission may not issue an opinion /advice but any person may then submit a signed and sworn complaint, which will be investigated by the Commission if there are allegations of Ethics Act violations by a person who is subject to the Ethics Act. To the extent you have inquired as to conduct that has already occurred, such past conduct may not be addressed in the context of an advisory opinion. However, to the extent you have inquired as to future conduct, your inquiry may, and shall, be addressed. In the former capacity as the A of Commonwealth Department B, Individual C would be considered a public official /public employee and an "executive -level State employee" subject to the Ethics Act and the Regulations of the State Ethics Commission. See, 65 Pa C.S. § 1102; 51 Pa. Code § 11.1. Confidential Advice, 09 -516 March 9, 2009 Page 3 Pursuant to Section 1103(a) of the Ethics Act, a public official /public employee is prohibited from engaging in conduct that constitutes a conflict of interest: § 1103. Restricted activities (a) Conflict of interest. - -No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa.C.S. § 1103(a). The following terms pertaining to conflicts of interest 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. Section 1103(a) of the Ethics Act prohibits a public official /public employee 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. Sections 1103(b) and 1103(c) of the Ethics Act provide in part that no person shall offer or give to a public official /public employee anything of monetary value and no public official /public employee shall solicit or accept anything of monetary value based upon the understanding that the vote, official action, or judgment of the public official /public employee would be influenced thereby. Reference is made to these provisions of the law not to imply that there has been or will be any transgression thereof but merely to provide a complete response to the question presented. Upon termination of service as the A of Commonwealth Department B, Individual C became a former public official /public employee and a former executive -level State Confidential Advice, 09 -516 March 9, 2009 Page 4 employee subject to the restrictions of Section 1103(g) and Section 1103(i) of the Ethics Act. Section 1103(i) restricts former executive -level State employees as follows: § 1103. Restricted activities (i) Former executive -level employee. - -No former executive -level State employee may for a period of two years from the time that he terminates employment with this Commonwealth be employed by, receive compensation from, assist or act in a representative capacity for a business or corporation that he actively participated in recruiting to this Commonwealth or that he actively participated in inducing to open a new plant, facility or branch in this Commonwealth or that he actively participated in inducing to expand an existent plant or facility within this Commonwealth, provided that the above prohibition shall be invoked only when the recruitment or inducement is accomplished by a grant or loan of money or a promise of a grant or loan of money from the Commonwealth to the business or corporation recruited or induced to expand. 65 Pa.C.S. § 1103(i). Section 1103(i) restricts the ability of a former executive -level State employee to accept employment or otherwise engage in business relationships following termination of State service, under certain narrow conditions. The restrictions of Section 1103(i) apply even where the business relationship is indirect, such as where the business in question is a client of a new employer, rather than the new employer itself. See, Confidential Opinion, 94 -011. However, Section 1103(i) would not restrict Individual from being employed by, receiving compensation from, assisting, or acting in a representative capacity for a business or corporation - -such as Organization G or an affiliate of Organization G -- subject to the conditions that Individual C did not actively participate in recruiting such business or corporation to Pennsylvania, and that Individual C did not actively participate in inducing such business or corporation to open or expand a plant, facility, or branch in Pennsylvania, through a grant or loan of money or a promise of a grant or loan of money from the Commonwealth of Pennsylvania. Unlike Section 1103(i), Section 1103(g) does not prohibit a former public official /public employee from accepting a position of employment. However, it does restrict the former public official /public employee with regard to "representing" a "person" before the governmental body with which he has been associated ": § 1103. Restricted activities (g) Former official or employee. - -No former public official or public employee shall represent a person, with promised or actual compensation, on any matter before the governmental body with which he has been associated for one year after he leaves that body. 65 Pa.C.S. § 1103(g) (Emphasis added). The terms "represent," "person," and "governmental body with which a public official or public employee is or has been associated" are specifically defined in the Ethics Act as follows: Confidential Advice, 09 -516 March 9, 2009 Page 5 § 1102. Definitions "Represent." To act on behalf of any other person in any activity which includes, but is not limited to, the following: personal appearances, negotiations, lobbying and submitting bid or contract proposals which are signed by or contain the name of a former public official or public employee. "Person." A business, governmental body, individual, corporation, union, association, firm, partnership, committee, club or other organization or group of persons. "Governmental body with which a public official or public employee is or has been associated." The governmental body within State government or a political subdivision by which the public official or employee is or has been employed or to which the public official or employee is or has been appointed or elected and subdivisions and offices within that governmental body. 65 Pa. C. S. § 1102. The term "Person" is very broadly defined. It includes, inter alia, corporations and other businesses. It also includes the former public employee himself, Confidential Opinion, 93 -005, as well as a new governmental employer. Ledebur, Opinion 95 -007. The term "representation" is also broadly defined to prohibit acting on behalf of any person in any activity. Examples of prohibited representation include: (1) personal appearances before the former governmental body or bodies; (2) attempts to influence; (3) submission of bid or contract proposals which are signed by or contain the name of the former public official /public employee; (4) participating in any matters before the former governmental body as to acting on behalf of a person; and (5) lobbying. Popovich, Opinion 89 -005. Listing one's name as the person who will provide technical assistance on a proposal, document, or bid, if submitted to or reviewed by the former governmental body, constitutes an attempt to influence the former governmental body. Section 1103(g) also generally prohibits the inclusion of the name of a former public official /public employee on invoices submitted by his new employer to the former governmental body, even if the invoices pertain to a contract that existed prior to termination of service with such governmental body. Shay, Opinion 91 -012. However, if such a pre- existing contract does not involve the unit where the former public employee worked, the name of the former public employee may appear on routine invoices if required by the regulations of the agency to which the billing is being submitted. Abrams/Webster, Opinion 95 -011. A former public official /public employee may assist in the preparation of any documents presented to his former governmental body. However, the former ublic official /public employee may not be identified on documents submitted to the former governmental body. The former public official /public employee may also counsel any person regarding that person's appearance before his former governmental body. Once again, however, the activity in this respect should not be revealed to the former governmental body. The Ethics Act would not prohibit or preclude making general informational inquiries to the former governmental body to secure information which is available to the general public, but this must not be done in an effort to indirectly influence the former governmental body or to otherwise make known to that body the representation of, or work for, the new employer. Confidential Advice, 09 -516 March 9, 2009 Page 6 Section 1103(g) only restricts the former public official /public employee with regard to representation before his former governmental body. The former public official /public employee is not restricted as to representation before other agencies or entities. However, the "governmental body with which a public official /public employee is or has been associated" is not limited to the particular subdivision of the agency or other governmental body where the public official /public employee had influence or control but extends to the entire body. See, Legislative Journal of House, 1989 Session, No. 15 at 290, 291; Sirolli, Opinion 90 -006; Sharp, Opinion 90- 009 -R. The governmental bodies with which Individual C is deemed to have been associated upon termination of service as the A of Commonwealth Department B, hereinafter collectively referred to as his "former governmental body," would be: the J, Office K in its entirety, Commonwealth Department B in its entirety, and all commissions, committees, councils, boards, task forces and the like on which Individual C served in his official capacity. Therefore, for the first year following termination of Individual C's service as the A of Commonwealth Department B, Section 1103(g) of the Ethics Act would apply and restrict "representation" of "persons" before Individual C's "former governmental body" as delineated above. You are advised that Section 1103(g) of the Ethics Act would not prohibit Individual C from accepting employment as the F of Organization G. However, during the first year following termination of his service as the A of Commonwealth Department B, Section 1103(g) of the Ethics Act would restrict Individual C from performing any job duties that would involve prohibited representation before his former governmental body as set forth above. As for Section 1103(a) of the Ethics Act, an advisory cannot provide a ruling as to past conduct. You are generally advised that the elements of a violation of Section 1103(a) of the Ethics Act would not be established as a result of a former public official /public employee rospectively entering into a business arrangement with an entity subject to the conditions that, while serving in the public position, such individual: (1) did not use the authority of the public position in any matter pertaining to the entity at a time when he had an actual or reasonable expectation that he would enter into a business arrangement with the entity or would otherwise receive a private pecuniary benefit relating to the entity; and (2) did not use confidential information received as a result of being in the public position in furtherance of securing a business arrangement or other private pecuniary benefit relating to the entity. See, Desmond, Opinion 08 -004. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act; the applicability of any other statute, code, ordinance, regulation or other code of conduct other than the Ethics Act has not been considered in that they do not involve an interpretation of the Ethics Act. Specifically not addressed herein is the applicability of the L. Conclusion: In the former capacity as the A of Commonwealth Department B, Individual C would be considered a public official /public employee and an "executive - level State employee" subject to the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq., and the Regulations of the State Ethics Commission, 51 Pa. Code § 11.1 et seq. Upon termination of service as the A of Commonwealth Department B, Individual C became a former public official /public employee and a former executive -level State employee subject to the restrictions of Section 1103(g) and Section 1103(i) of the Ethics Act. The restrictions of Section 1103(g) and Section 1103(i) of the Ethics Act as outlined above must be followed. Under Section 1103(i) of the Ethics Act, Individual C would not be prohibited from being employed by, receiving compensation from, assisting, or acting in a representative capacity for a business or corporation - -such as the [name of Confidential Advice, 09 -516 March 9, 2009 Page 7 organization] (hereinafter referred to as "Organization G ") or an affiliate of Organization G -- subject to the conditions that Individual C did not actively participate in recruiting such business or corporation to Pennsylvania, and that Individual C did not actively participate in inducing such business or corporation to open or expand a plant, facility, or branch in Pennsylvania, through a grant or loan of money or a promise of a grant or loan of money from the Commonwealth of Pennsylvania. With regard to Section 1103(g) of the Ethics Act, the governmental bodies with which Individual C is deemed to have been associated upon termination of service as the A of Commonwealth Department B, hereinafter collectively referred to as his "former governmental body," would be: the J, Office K in its entirety, Commonwealth Department B in its entirety, and all commissions, committees, councils, boards, task forces and the like on which Individual C served in his official capacity. Therefore, for the first year following termination of Individual C's service as the A of Commonwealth Department B, Section 1103(g) of the Ethics Act would apply and restrict "representation" of "persons" before Individual C's "former governmental body" as delineated above. Section 1103(g) of the Ethics Act would not prohibit Individual C from accepting employment as the F of Organization G. However, during the first year following termination of his service as the A of Commonwealth Department B, Section 1103(g) of the Ethics Act would restrict Individual C from performing any job duties that would involve prohibited representation before his former governmental body as set forth above. With regard to Section 1103(a) of the Ethics Act, an advisory cannot provide a ruling as to past conduct. You are generally advised that the elements of a violation of Section 1103(a) of the Ethics Act would not be established as a result of a former public official /public employee rospectively entering into a business arrangement with an entity subject to the conditions that, while serving in the public position, such individual: (1) did not use the authority of the public position in any matter pertaining to the entity at a time when he had an actual or reasonable expectation that he would enter into a business arrangement with the entity or would otherwise receive a private pecuniary benefit relating to the entity; and (2) did not use confidential information received as a result of being in the public position in furtherance of securing a business arrangement or other private pecuniary benefit relating to the entity. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Pursuant to Section 1107(11) of the Ethics Act, 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 Confidential Advice, 09 -516 March 9, 2009 Page 8 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