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HomeMy WebLinkAbout09-539Patricia Then 1000 E. Ridge Ave. Conway, PA 15027 Dear Ms. Then: ADVICE OF COUNSEL April 14, 2009 09 -539 This responds to your letter dated March 1, 2009, by which you requested an 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 prohibitions or restrictions upon an individual with regard to performing the duties of a borough council member if she would be elected to such position, when: (1) the individual's spouse has a business that tows for the borough police department pursuant to a verbal agreement and not a written contract; (2) towing for the borough police department is shared on a bi- monthly basis between the spouse's business and another towing business located within the borough; (3) the vehicle owner is always responsible for payment of the towing costs when the borough police department requests towing for any reason; and (4) neither the borough nor the borough police department receives any compensation from the vehicle owner or the business that performs the towing. Facts: You have requested an advisory from the Pennsylvania State Ethics C ommission based upon submitted facts that may be fairly summarized as follows. You are seeking election in 2009 as a Member of Council for the Borough of Conway ( "the Borough"). You state that your husband has a business "the Business ") that has been towing for the Borough Police Department ( "Police Department") for approximately twenty (20) years. The Business performs such towing pursuant to a verbal agreement and not a written contract. Towing for the Police Department is shared on a bi- monthly basis between the Business and another towing business located within the Borough. You state that when the Police Department requests towing for any reason, such as an accident, breakdown or impound, the vehicle owner is always responsible for payment of the towing costs. You state that neither the Police Department nor the Borough ever receives any compensation from the vehicle owner or the business that performs the towing. Then, 09 -539 April 14, 2009 Page 2 Based upon the above submitted facts, you ask whether you would have a conflict of interest under the Ethics Act if you would be elected to Borough Council while your husband would be towing for the Police Department. 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 noted that, pursuant to the same aforesaid Sections of the Ethics Act, 65 Pa.C.S. §§ 1107(10), (11), an opinion /advice may be given only as to prospective (future) conduct. To the extent that your inquiry relates to conduct that has already occurred, such past conduct may not be addressed in the context of an advisory opinion. However, to the extent your inquiry relates to future conduct, your inquiry may and shall be addressed. If you would be elected as a Borough Council Member, upon assuming said position, you would in that capacity be 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 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. Then, 09 -539 April 14, 2009 Page 3 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. "Immediate family." A parent, spouse, child, brother or sister. "Business." Any corporation, partnership, sole proprietorship, firm, enterprise, franchise, association, organization, self - employed individual, holding company, joint stock company, receivership, trust or any legal entity organized for profit. "Business with which he is associated." Any business in which the person or a member of the person's immediate family is a director, officer, owner, employee or has a financial interest. "Financial interest." Any financial interest in a legal entity engaged in business for profit which comprises more than 5% of the equity of the business or more than 5% of the assets of the economic interest in indebtedness. 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. If a business with which the public official /public employee or immediate family member is associated or a private customer /client would have a matter pending before the governmental body, the public official /public employee generally would have a conflict of interest as to such matter. Kannebecker, Opinion 92 -010; Miller, Opinion 89- Then, 09 -539 April 14, 2009 Page 4 024. A reasonable and legitimate anticipation that a business relationship will form may also support a finding of a conflict of interest. Amato, Opinion 89 -002. In each instance of a conflict of interest, the public official /public employee would be required to abstain fully from participation. The abstention requirement would not be limited merely to voting, but would extend 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. Subject to certain statutory exceptions, 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. Section 1103(f) of the Ethics Act provides as follows: § 1103. Restricted activities (f) Contract. - -No public official or public employee or his spouse or child or any business in which the person or his spouse or child is associated shall enter into any contract valued at $500 or more with the governmental body with which the public official or public employee is associated or any subcontract valued at $500 or more with any person who has been awarded a contract with the governmental body with which the public official or public employee is associated, unless the contract has been awarded through an open and public process, including prior public notice and subsequent public disclosure of all proposals considered and contracts awarded. In such a case, the public official or public employee shall not have any supervisory or overall responsibility for the implementation or administration of the contract. Any contract or subcontract made in violation of this subsection shall be voidable by a court of competent jurisdiction if the suit is commenced within 90 days of the making of the contract or subcontract. 65 Pa. C. S. § 1103(f). Section 1103(f) does not operate to make contracting with the governmental body permissible where it is otherwise prohibited. Rather, where a public official /public employee, his spouse or child, or a business with which he, his spouse or child is associated, is otherwise appropriately contracting with the governmental body, or subcontracting with any person who has been awarded a contract with the governmental body, in an amount of $500.00 or more, Section 1103(f) requires that an "open and public process" be observed as to the contract with the governmental body. Section 1103(f) of the Ethics Act also requires that the public official /public employee may not have any supervisory or overall responsibility as to the implementation or administration of the contract with the governmental body. In applying the above provisions of the Ethics Act to the instant matter, you are advised as follows. Your husband is a member of your immediate family as that term is defined in the Ethics Act. The Business is a business with which your husband is associated in his capacity as the owner. Then, 09 -539 April 14, 2009 Page 5 If elected as a Borough Council Member, you generally would have a conflict of interest under Section 1103(a) of the Ethics Act in matters that would financially impact you, your husband, the Business, or the Business's customer(s) /client(s). See, Kannebecker, supra; Miller, supra. In each instance of a conflict of interest, you would be required to abstain fully from participation. The abstention requirement would not be limited to voting, but rather would extend to any use of authority of office. In each instance of a voting conflict, you would be required to abstain fully and to satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. The requirements of Section 1103(f) of the Ethics Act would have to be observed when applicable. The ropriety of the proposed conduct has only been addressed under the Ethics Act. Specifically not addressed herein is the applicability of the Borough Code. Conclusion: If you would be elected as a Member of Council for the Borough of Conway "the Borough "), upon assuming said position, you would in that capacity be a public official subject to the provisions of the Ethics Act. Based upon the submitted facts that: (1) your husband has a business ( "the Business ") that has been towing for the Borough Police Department ( "Police Department ") for approximately twenty (20) years; (2) the Business performs such towing pursuant to a verbal agreement and not a written contract; (3) towing for the Police Department is shared on a bi- monthly basis between the Business and another towing business located within the Borough; (4) when the Police Department requests towing for any reason, the vehicle owner is always responsible for payment of the towing costs; and (5) neither the Police Department nor the Borough ever receives any compensation from the vehicle owner or the business that performs the towing, you are advised as follows. If elected as a Borough Council Member, you generally would have a conflict of interest under Section 1103(a) of the Ethics Act in matters that would financially impact you, your husband, the Business, or the Business's customer(s) /client(s). In each instance of a conflict of interest, you would be required to abstain fully from participation. The abstention requirement would not be limited to voting, but rather would extend to any use of authority of office. In each instance of a voting conflict, you would be required to abstain fully and to satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. The requirements of Section 1103(f) of the Ethics Act would have to be observed when applicable. 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 Then, 09 -539 April 14, 2009 Page 6 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