HomeMy WebLinkAbout10-548 Haines
ADVICE OF COUNSEL
February 22, 2010
Michael J. Antkowiak, Esquire
1149 Liberty Street
Suite 3
Franklin, PA 16323
10-548
Dear Mr. Antkowiak:
This responds to your faxed letter dated December 30, 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.C.S. § 1101 et seq., would present any prohibitions or restrictions upon an individual
with regard to serving as a school director for a school district where: (1) the individual
is employed as a secretary and bus driver with a busing company that is owned by the
individual’s spouse; and (2) the busing company is one of five bus contractors that
provide school bus services to students of the school district.
Facts:
You have been authorized by Teresa Haines (“Mrs. Haines”) to request an
advisory from the Pennsylvania State Ethics Commission on her behalf. You have
submitted facts that may be fairly summarized as follows.
You state that in November 2009, Mrs. Haines was elected to serve a four-year
term as a School Director for the Clarion-Limestone School District (“School District”),
located in Clarion County, Pennsylvania.
Since 1988, Mrs. Haines’ husband, Kevin Haines (“Mr. Haines”), has owned and
operated Haines Busing. You state that Haines Busing is one of five bus contractors
that provide school bus services to students of the School District. Mrs. Haines is
employed by Haines Busing as a secretary and bus driver. You state that the buses of
Haines Busing are titled jointly in the names of Mr. and Mrs. Haines.
Based upon the above submitted facts, you pose the following questions:
1. Whether the Ethics Act would permit Mrs. Haines to hold office as a
School District School Director; and
2. If Mrs. Haines would be permitted to hold office as a School District
School Director, whether there are any ethical restrictions of which she
must or should be aware.
Antkowiak, 10-548
February 22, 2010
Page 2
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.
Upon taking office as a School Director for the School District, Mrs. Haines in that
capacity would be a “public official” subject to the provisions of the Ethics Act. See, 65
Pa.C.S. § 1102; 51 Pa. Code § 11.1.
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 related to Section 1103(a) 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
Antkowiak, 10-548
February 22, 2010
Page 3
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.
"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.
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.
Sections 1103(b) and 1103(c) of the Ethics Act, pertaining to improper influence,
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. 65
Pa.C.S. §§ 1103(b), (c). 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 questions presented.
Antkowiak, 10-548
February 22, 2010
Page 4
Section 1103(f) of the Ethics Act, pertaining to contracting, 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).
The term “contract” is defined in the Ethics Act as follows:
§ 1102. Definitions
"Contract."
An agreement or arrangement for the
acquisition, use or disposal by the Commonwealth or a
political subdivision of consulting or other services or of
supplies, materials, equipment, land or other personal or real
property. The term shall not mean an agreement or
arrangement between the State or political subdivision as
one party and a public official or public employee as the
other party, concerning his expense, reimbursement, salary,
wage, retirement or other benefit, tenure or other matters in
consideration of his current public employment with the
Commonwealth or a political subdivision.
65 Pa.C.S. § 1102.
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 provides that the public official/public employee--
in his public capacity--may not have any supervisory or overall responsibility as to the
implementation or administration of the contract with the governmental body.
It is administratively noted that the Public School Code of 1949 as amended
(“Public School Code”) provides in pertinent part:
Antkowiak, 10-548
February 22, 2010
Page 5
§ 3-324. Not to be employed by or do business with
district; exceptions
(a) No school director shall, during the term for which he
was elected or appointed, as a private person engaged in
any business transaction with the school district in which he
is elected or appointed, be employed in any capacity by the
school district in which he is elected or appointed, or receive
from such school district any pay for services rendered to the
district except as provided in this act…
….
(c) It shall not be a violation of this section for a school
district to contract for the purchase of goods or services from
a business with which a school director is associated to the
extent permitted by and in compliance with 65 Pa.C.S. Ch.
11 (relating to ethics standards and financial disclosure).
24 P.S. §§ 3-324(a), (c). On its face, Section 3-324(c) of the Public School Code
permits contracting between school districts and businesses with which school directors
are associated as long as the requirements of the Ethics Act are observed.
In applying the provisions of the Ethics Act to the questions you have posed, it is
noted that Section 1103(a) of the Ethics Act 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 being in that position--for the advancement of his own private
pecuniary benefit or that of a business 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, 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 client(s). Miller, Opinion 89-024; Kannebecker, Opinion 92-010. 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 from
participation, and in the instance of a voting conflict, to abstain and fully satisfy the
disclosure requirements of Section 1103(j) of the Ethics Act.
You are advised that Haines Busing is a business with which Mrs. Haines is
associated in her capacity as an employee and with which Mr. Haines is associated in
his capacity as the owner. Subject to the statutory exclusions to the definition of
“conflict” or “conflict of interest” as set forth in Section 1102 of the Ethics Act, 65 Pa.C.S.
§ 1102, pursuant to Section 1103(a) of the Ethics Act, Mrs. Haines would have a conflict
of interest as a School Director in matters that would financially impact her, her
husband, or Haines Busing. Mrs. Haines would also be prohibited from using the
authority of her public position as a School Director, or confidential information
accessed or received as a result of being a School Director, to effectuate a private
pecuniary benefit to her, her husband, or Haines Busing through a detriment to a
competitor for School District work. See, Pepper, Opinion 87-008.
In each instance of a conflict of interest, Mrs. Haines 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, Mrs.
Antkowiak, 10-548
February 22, 2010
Page 6
Haines would be required to abstain and to fully satisfy the disclosure requirements of
Section 1103(j) of the Ethics Act.
The restrictions and requirements of Section 1103(f) of the Ethics Act would have
to be observed when applicable.
In response to your first question, you are advised that the Ethics Act would not
preclude Mrs. Haines from serving as a School Director for the School District.
Your second question is general and has been addressed above to the extent
that it can be addressed.
The propriety of the proposed conduct has only been addressed under the Ethics
Act.
Conclusion:
Based upon the submitted facts that: (1) in November 2009, Teresa
Haines (“Mrs. Haines”) was elected to serve a four-year term as a School Director for
the Clarion-Limestone School District (“School District”), located in Clarion County,
Pennsylvania; (2) since 1988, Mrs. Haines’ husband, Kevin Haines (“Mr. Haines”), has
owned and operated Haines Busing; (3) Haines Busing is one of five bus contractors
that provide school bus services to students of the School District; and (4) Mrs. Haines
is employed by Haines Busing as a secretary and bus driver, you are advised as
follows. The Ethics Act would not preclude Mrs. Haines from serving as a School
Director for the School District. Upon taking office as a School Director for the School
District, Mrs. Haines in that capacity would be a “public official” subject to the provisions
of the Ethics Act. Haines Busing is a business with which Mrs. Haines is associated in
her capacity as an employee and with which Mr. Haines is associated in his capacity as
the owner. Subject to the statutory exclusions to the definition of “conflict” or “conflict of
interest” as set forth in Section 1102 of the Ethics Act, 65 Pa.C.S. § 1102, pursuant to
Section 1103(a) of the Ethics Act, Mrs. Haines would have a conflict of interest as a
School Director in matters that would financially impact her, her husband, or Haines
Busing. Mrs. Haines would also be prohibited from using the authority of her public
position as a School Director, or confidential information accessed or received as a
result of being a School Director, to effectuate a private pecuniary benefit to her, her
husband, or Haines Busing through a detriment to a competitor for School District work.
In each instance of a conflict of interest, Mrs. Haines 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, Mrs. Haines would
be required to abstain and to fully satisfy the disclosure requirements of Section 1103(j)
of the Ethics Act. The restrictions and 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.
Antkowiak, 10-548
February 22, 2010
Page 7
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