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HomeMy WebLinkAbout09-566 ConfidentialADVICE OF COUNSEL July 21, 2009 09 -566 This responds to your letter dated June 5, 2009, and your faxed transmission received June 10, 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 present any prohibitions or restrictions upon you as a County A ( "County ") Council Member with regard to participating in matters before County Council pertainin g to bond issues for construction /renovation costs for two County projects, where a [type of firm] with which you are employed might bid on the construction /renovation proposals for such County projects. Facts: In your capacity as a County Council Member, you request an advisory from the Pennsylvania State Ethics Commission based upon submitted facts that may be fairly summarized as follows. You first note that two prior confidential advisories were issued to you by the State Ethics Commission. It is administratively noted that Confidential Advice, [number] was issued to you based upon facts set forth in an advisory request letter dated [date]. Confidential Advice, [number] concluded that you would have a conflict of interest as to the County's approval of financing for a project where a [type of firm] for which you were a contracted consultant, specifically, Firm B, intended to bid on the project, and you stood to financially benefit if that firm would be awarded the contract. It is further administratively noted that Confidential Advice, [number] was issued to you based upon facts set forth in an advisory request letter dated [date]. In said letter, you stated that the particulars of your then - current situation were the same as those addressed in Confidential Advice, [number], except that the matter before County Council was a proposed bond issue for a C Authority project. Based upon the submitted facts that: (1) you had an ongoing business relationship with Firm B as a contracted consultant for that firm; (2) County Council was considering a proposed bond issue for the project; and (3) if and when the issue was totally approved, Firm B might bid on the construction proposal for the project, Confidential Advice, [number] concluded that you would have a conflict of interest in your capacity as a County Council Member as to matter(s) pertaining to the proposed bond issue for the project. Confidential Advice, 09 -566 July 21, 2009 Page 2 With respect to your current advisory request, you state that you are no longer a consultant for Firm B, but you remain employed with Firm B. You state that the County is proposing bond issues for construction /renovation costs for projects (hereinafter referred to as the Projects ") involving a D and the E. You further state that Firm B might bid on the construction /renovation proposals for the Projects. Based upon the above submitted facts, you ask whether you would have a conflict of interest in matters pertaining to the bond issues for the Projects, given that Firm B might bid on the construction /renovation proposals for the Projects. 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 a County Council Member, 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 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: Confidential Advice, 09 -566 July 21, 2009 Page 3 § 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. "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. 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, a member of his immediate family, or a business with which he or a member of his immediate family is associated. 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. It is noted that Section 1103(a) of the Ethics Act pertaining to conflicts of interests does not prohibit public officials /public employees from having outside business activities or employment; however, the public official /public employee may not use the authority of his public position - -or confidential information obtained by loeing in that position - -for the advancement of his own private pecuniary benefit or that of a business Confidential Advice, 09 -566 July 21, 2009 Page 4 with which he is associated. Pancoe, Opinion 89 -011. Examples of conduct that would be prohibited under Section 1103(a) would include: (1) the pursuit of a private business opportunity in the course of public action, Metrick, Order 1037; (2) the use of governmental facilities, such as governmental telephones, postage, staff, equipment, research materials, or other property, or the use of governmental personnel, to conduct private business activities, Freind, Order 800; Pancoe, supra; and (3) the participation in an official capacity as to matters involving the business with which the public official /public employee is associated in his private capacity or private clients(s). Miller, Opinion 89 -024; Kannebecker, Opinion 92 -010. 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, supra; Miller, supra. A reasonable and legitimate expectation 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 and in the instance of a voting conflict, to abstain and satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. In applying the above provisions of the Ethics Act to your inquiry, you are advised as follows. Based upon the submitted facts that: (1) you are employed with Firm B; (2) County Council is considering proposed bond issues for the Projects; and (3) Firm B might bid on the construction /renovation proposals for the Projects, you would have a conflict of interest in your capacity as a County Council Member as to matter(s) pertaining to proposed bond issue(s) for the Projects. In each instance of a conflict of interest, you would be required to abstain fully from participation. The abstention requirement would extend beyond voting to include any use of authority of office. In each instance of a voting conflict, you would be required 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. The ropriety of the proposed conduct has only been addressed under the Ethics Act. Specifically not addressed herein is the applicability of the F. Conclusion: As a County Council Member for County A ( "County "), you are a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq. Based upon the submitted facts that: (1) you are employed with the [type of firm] of Firm B; (2) County Council is considering proposed bond issues for construction /renovation costs for projects (hereinafter referred to as the Projects ") involving a D and the E; and (3) Firm B might bid on the construction /renovation proposals for the Projects, you would have a conflict of interest in your capacity as a County Council Member as to matter(s) pertaining to proposed bond issue(s) for the Projects. In each instance of a conflict of interest, you would be required to abstain fully from participation. The abstention requirement would extend beyond voting to include any use of authority of office. In each instance of a voting conflict, you would be required 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. 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. Confidential Advice, 09 -566 July 21, 2009 Page 5 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