HomeMy WebLinkAbout10-561 Haley
ADVICE OF COUNSEL
April 1, 2010
M. John Haley, Esquire
115 East Bennett Street
Kingston, PA 18704
10-561
Dear Mr. Haley:
This responds to your letters/submissions of January 26, 2010, March 5, 2010,
and March 25, 2010, 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 impose any prohibitions or restrictions upon two township
supervisors, who serve on a three-member township board of supervisors, with regard
to a conditional use application submitted by two applicants seeking approval for the
drilling of a commercial natural gas well, where: (1) one of the aforesaid two supervisors
serves in a private capacity as executive director of a nonprofit corporation that leases
lands to the applicant(s), such services as executive director are provided on a part-time
basis as a consultant and not as an employee, the supervisor has no vote on decisions
of the nonprofit corporation, the supervisor will not receive any compensation from the
nonprofit corporation in connection with the leasing of its lands, and the nonprofit
corporation’s lands are not included in the group of properties scheduled to serve this
particular well but could be impacted by successful drilling findings; (2) the other of the
aforesaid two supervisors owns real property that he has leased to one of the
applicants, and such property is not included in the group of properties scheduled to
serve this particular well but could be impacted by successful drilling findings; and (3)
the value of the aforesaid leases could be affected by the granting or denying of the
conditional use application; and, if both supervisors would have conflicts of interest,
whether it would be preferable for one or the other of them to participate as to the
aforesaid conditional use application.
Facts:
You are Solicitor for the Lehman Township (“Township”) Zoning Hearing
Board and the Township Planning Commission (“Planning Commission”). You have
been authorized to request an advisory from the Pennsylvania State Ethics Commission
on behalf of Township Supervisors David H. Sutton (“Mr. Sutton”) and Douglas W. Ide
(“Mr. Ide”). You have submitted facts and documents, the material portion of which may
be fairly summarized as follows.
Haley, 10-561
April 1, 2010
Page 2
The Township is a second class township governed by the provisions of the
Second Class Township Code, 53 P.S. § 65101 et seq . The Township Board of
Supervisors (“Board”) is a three-member board.
Mr. Sutton is Chairman of the Board. The other Board Members are Mr. Ide and
Raymond J. Iwanowski (“Mr. Iwanowski”).
The Township has adopted and administers its own Zoning Ordinance (“Zoning
Ordinance”). The current version of the Zoning Ordinance was enacted on December
27, 2007, with revisions enacted on October 6, 2008. You have submitted a copy of
Article 8 of the Zoning Ordinance, which provides, in pertinent part, as follows:
SECTION 802 GENERAL PROVISIONS
The authority for approving or denying applications for uses
permitted as a conditional use shall be vested in the Lehman
Township Board of Supervisors, with the Lehman Township
Planning Commission having the authority to review and
submit their [sic] recommendations to the Board of
Supervisors. . . .
SECTION 803 PROCEDURE FOR SUBMISSION AND
DECISIONS
The procedure for approval or denial of a conditional use
shall be in accordance with the following:
. . . .
B. Prior to approving or denying an application for a
conditional use, the Lehman Township Board of
Supervisors shall conduct a public hearing pursuant
to public notice. The Board of Supervisors shall
submit the application for the proposed conditional
use to the Lehman Township Planning Commission,
not less than thirty (30) days prior to the public
hearing, to allow the Planning Commission to submit
any such recommendations as they [sic] may deem
appropriate. . . .
Zoning Ordinance, Article 8, §§ 802, 803 B.
Presently before the Board for decision is a conditional use application (“the
Conditional Use Application”) submitted by WhitMar Exploration Company (“WhitMar”)
and EnCana Oil and Gas USA, Inc. (“EnCana”), hereinafter collectively referred to as
“the Applicants,” seeking approval for the drilling of a commercial natural gas well on
certain real property owned by Russell and Larry Lansberry, hereinafter referred to as
“the Lansberry Property.”
You state that the Applicants intend to drill a vertical gas well on the Lansberry
Property seeking evidence of a concentration of natural gas in the “Marcellus Shale”
formation sufficient to warrant further drilling, processing and other gas recovery
activities. You further state that should such drilling efforts prove fruitful, the Applicants
might extend the drilling outward in one or more horizontal directions and, through a
process known as “fracking,” recover marketable quantities of natural gas. The
horizontal drilling could extend underground beyond the boundaries of the Lansberry
Property.
Haley, 10-561
April 1, 2010
Page 3
You state that natural gas exploration companies in Marcellus Shale locations
typically enter into “Oil and Gas Leases” with numerous property owners, usually paying
“per acre” fees up front and combining such leases into “units” of approximately 640
acres each. Recovered natural gas from these units is transported to market via
pipelines, and “royalties” are paid to unit landowners in proportion to their respective
acreage share and the royalty percentage specified in their lease.
You state that Mr. Iwanowski is not known or believed to have any actual or
potential conflict of interest regarding the Conditional Use Application. Mr. Sutton and
Mr. Ide are concerned that they might have potential conflicts for reasons set forth
below.
Procedurally, on December 4, 2009—prior to the submission of the Conditional
Use Application—you, Mr. Sutton, Mr. Ide, and Mr. Iwanowski met with Thomas R.
Byrnes (“Mr. Byrnes”), a Hydrogeologist with a company named “Strategic
Environmental, LLC.” That company had been tasked by WhitMar with preparing the
necessary forms and documents required to be submitted to the Township. You state
that the December 4, 2009, meeting was for procedural purposes only, that no vote or
other official action was taken, and that neither the then-nonexistent application nor any
merits or lack of merits of the proposed project were discussed. You state that Mr.
Byrnes was provided with information regarding how to submit and process a
conditional use application, and then Mr. Byrnes, the Supervisors, and you arrived at a
scheduling of the various steps required in the matter. You state that it became readily
apparent that a date for a public hearing of the Board needed to be set and that special
meetings of both the Planning Commission and the Board were going to be required.
You further state that the date of December 28, 2009, was agreed upon for the special
meeting of the Planning Commission, and the date of January 20, 2010, was agreed
upon for both the public hearing and the originally contemplated special meeting and
action of the Board.
In addition to serving as Township Supervisors, both Mr. Sutton and Mr. Ide
serve as Members of the Planning Commission. Mr. Sutton is also Chairman of the
Planning Commission.
The Planning Commission is not purely advisory. Per Section 101 of the Lehman
Township Subdivision and Land Development Ordinance, the Board has conferred upon
the Planning Commission the authority to approve or disapprove all subdivisions and
land developments. However, the Planning Commission’s authority with regard to
conditional use applications is limited to reviewing such applications and providing
recommendations to the Board. Zoning Ordinance, Article 8, Section 802.
On December 28, 2009, the Planning Commission held a special meeting to
review the Conditional Use Application. You have submitted a copy of the minutes from
that meeting. Per the meeting minutes, prior to the presentation regarding the
Conditional Use Application, it was noted that Mr. Ide was absent from the meeting and
that Mr. Sutton would be abstaining from voting on the Conditional Use Application.
Following a presentation by representative(s) of the Applicants, questioning of such
representative(s) by Planning Commission Members, discussion and public comment,
the Planning Commission passed by a majority vote the following motion to recommend
to the Board approval of the Conditional Use Application:
The Lehman Township Planning Commission recommends
to the Lehman Township Board of Supervisors that the
Conditional Use Application submitted by EnCana/Whitmar
be approved with special attention being paid to the
restoration of any Township Roads that may be damaged
during the drilling process and assurances from
EnCana/Whitmar that wells in the Township will be protected
Haley, 10-561
April 1, 2010
Page 4
and any wells that might be affected by the drilling, be
restored to their original condition.
Lehman Township Planning Commission Meeting Minutes of December 28, 2009, at 1-
2. There is no indication in the meeting minutes of any participation by Mr. Sutton
during the December 28, 2009, special meeting. Per the meeting minutes, Mr. Sutton
abstained from the vote as to the aforesaid motion.
By letter dated December 28, 2009, the Secretary of the Planning Commission
informed the Board of the Planning Commission’s review of the Conditional Use
Application and approval of the aforesaid motion. You state that the Supervisors were
not involved in the preparation of such letter.
On January 20, 2010, the Board held a public hearing regarding the Conditional
Use Application. At the January 20, 2010, public hearing, Mr. Sutton and Mr. Ide
provided verbal statements regarding their perceived potential conflicts of interest and
also submitted written memoranda to that effect. You have provided a copy of a partial
transcript of the January 20, 2010, public hearing of the Board (“Partial Transcript”) as
well as copies of the aforesaid memoranda submitted by Mr. Sutton and Mr. Ide.
Mr. Sutton’s memorandum dated January 20, 2010, states in part as follows:
Whitmar Exploration Company and EnCana Oil and Gas,
Inc. (Companies) have applied for a Conditional Use Permit
to install a vertical gas well in Lehman Township. . . . The
Lehman Township Supervisors are the governing body
required to approve or deny the application.
As a member of the Board of Supervisors, I may have a
conflict of interest in taking part in this decision for the
following reason:
Back Mountain Recreation, Inc. (BMR) has a signed lease
with the Companies allowing gas to be removed from under
its property. I fulfill the duties of Executive Director as a
consultant on a part time basis to BMR. I am not directly
employed by BMR nor do I have a vote on any of the
decisions made by BMR. Should the Conditional use Permit
be approved by the Lehman Township Board of Supervisors,
I will not receive any financial gain as a result of any monies
that might be distributed to BMR by the Companies. I have
been advised by representatives of EnCana Oil and Gas,
Inc. that the BMR property is not in the group of properties
scheduled to serve this well.
However, I still feel it is necessary to explain any situation
that might be construed as a conflict. I am requesting that
the Ethics Commission be contacted for a determination
prior to any action by the Board of Supervisors. The
potential conflict exists because there is a remote possibility
that, depending on what they find from the vertical well, the
Companies might decide to revise the group of lots serving
the well or to add horizontal turn(s) to the vertical well and in
doing so may go beneath lands that would entitle BMR to
receive payment(s).
January 20, 2010, Memorandum of Mr. Sutton.
Haley, 10-561
April 1, 2010
Page 5
Mr. Ide’s memorandum dated January 20, 2010, states in part as
follows:
Whitmar Exploration Company and EnCana Oil and Gas,
Inc. (Companies) have applied for a Conditional Use Permit
to install a vertical gas well in Lehman Township. . . . The
Lehman Township Supervisors are the governing body
required to approve or deny the application.
As a member of the Board of Supervisors, I may have a
conflict of interest in taking part in this decision for the
following reason:
I own property within Lehman Township which is leased to
Whitmar Exploration Company for the drilling and removal of
natural gas. While none of the property that I own is in the
area affected by this permit application and I have nothing to
gain financially from the issuance or denial of this permit,
none the less [sic] I feel a conflict of interest may exist.
I am requesting that the Ethics Commission be contacted for
a determination prior to any action by the Board of
Supervisors.
January 20, 2010, Memorandum of Mr. Ide.
The verbal disclosures that Mr. Sutton and Mr. Ide provided at the January 20,
2010, public hearing regarding their perceived potential conflicts of interest are
consistent with the contents of their memoranda and appear at pages 7-10 of the Partial
Transcript.
You state that at the January 20, 2010, public hearing, there were a couple of
occasions during the Applicants’ presentation and the public input when either Mr.
Sutton or Mr. Ide made comments that are not included in the portions of the
proceedings covered by the Partial Transcript. You have represented that none of
those comments contained anything more than requests to avoid repetition of matters
already discussed, procedural matters involved in conducting the hearing, and a
warning--when the landowners on whose land the proposed well would be drilled
identified themselves--that abuse of those individuals would not be tolerated.
Toward the conclusion of the January 20, 2010, public hearing, the Supervisors
informed those in attendance that rather than take action at a special meeting following
the public hearing, as had been originally scheduled, they intended to do so at their
March 15, 2010, regular meeting.
Subsequently, the Board’s action as to the Conditional Use Application was
further postponed pending issuance of an advisory from the Pennsylvania State Ethics
Commission. At the request of the Supervisors, the Applicants granted certain
extensions to enable Mr. Sutton and Mr. Ide to obtain such an advisory.
You have submitted copies of emails that involve contact between the
Supervisors and EnCana’s Regulatory Land Advisor. These emails pertain solely to
time extension matters except for one, which advises EnCana that it is not required to
have its “entire contingent” present when the Supervisors’ official action is taken, and
that if other natural gas well drilling applications are received in the future, the
Supervisors will not accept testimony at public hearings regarding matters that the
Supervisors are by law forbidden to use Township ordinances to regulate.
Haley, 10-561
April 1, 2010
Page 6
You state that it appears that the potential bases for a conflict of interest on the
part of Mr. Sutton include: (1) a potential increase or decrease in the value of BMR’s
lease interests with the Applicant(s) due to the approval or denial of the Conditional Use
Application or a successful drilling result, which you state is speculative but “potentially
existent”; (2) the potential for successful drilling findings to result in horizontal
extension(s) of that or another well from the Lansberry Property to include the property
of BMR, which you state is presently not expected, probable, or even likely, but is
possible; and (3) the possibility that successful drilling findings might induce the
Applicants, or others, to drill other wells within the Township, which might impact BMR’s
property.
You state that it appears that the potential bases for a conflict of interest on the
part of Mr. Ide include: (1) a potential increase or decrease in the value of Mr. Ide’s
lease interests with WhitMar due to the approval or denial of the Conditional Use
Application or a successful drilling result, which you state is speculative but “potentially
existent”; and (2) the possibility that successful drilling findings might induce the
Applicants, or others, to drill other wells within the Township, which might impact Mr.
Ide’s property.
You state that in order for there to be a quorum at an official meeting of the
Board, two of the three Supervisors must be present. This means that the presence of
Mr. Sutton or Mr. Ide would be necessary to have a quorum.
You further state that in order for the Board to take official action as to the
Conditional Use Application, the participation of Mr. Sutton or Mr. Ide would be needed
to second a motion and achieve the majority vote required for action by the Board.
Based upon the above, you ask: (1) whether Mr. Sutton or Mr. Ide would have a
conflict of interest with regard to the Conditional Use Application; and (2) if both Mr.
Sutton and Mr. Ide would have conflicts of interest as to the Conditional Use
Application, whether it would be preferable for one or the other of them to participate in
the Board’s action as to the Conditional Use Application.
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. An advisory does not afford a defense as to
past conduct.
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. It is noted that you have provided extensive information in support of your
request so as to assure the Commission that all actions by Mr. Sutton and Mr. Ide in
their public capacities have been non-substantive and have been limited to those set
forth in the factual recitation above.
Haley, 10-561
April 1, 2010
Page 7
As Township Supervisors and as Members of the Planning Commission (a
decision-making board), Mr. Sutton and Mr. Ide are public officials as that term is
defined in the Ethics Act, and therefore they are 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:
§ 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.
Haley, 10-561
April 1, 2010
Page 8
"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.
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, 65 Pa.C.S. §§ 1103(b), (c),
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. 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.
It is noted that the above statutory definition of the term "conflict" or "conflict of
interest" contains two exclusions, referred to herein as the "de minimis exclusion" and
the "class/subclass 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; Schweinsburg, Order 900.
Haley, 10-561
April 1, 2010
Page 9
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; 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.
It is further noted that a conflict of interest under Section 1103(a) of the Ethics
Act may be based upon an ongoing business relationship (Kitner, Order 1542;
Burchfield, Order 1492; Johnson, Order 1338; Confidential Opinion, 06-001;
Kannebecker, Opinion 92-010; Miller, Opinion 89-024), a reasonable and legitimate
expectation that a business relationship will form (Gerhard, Order 1460; Mann, Opinion
07-005; Moore, Opinion 04-004; Confidential Opinion, 00-006; Amato, Opinion 89-002),
or situations involving “reciprocity of power.” See, e.g., Confidential Opinion, 05-004;
Elisco, Opinion 00-003. Generally, it is a conflict of interest for a public official/public
employee to participate in an official capacity as to matters involving a business with
which the public official/public employee is associated in his private capacity (Gorman,
Order 1041; Rembold, Order 1303; Wilcox, Order 1306), or private client(s) (Miller,
supra; Kannebecker, supra). Of course, in any given instance, a violation of the Ethics
Act would not be found unless each element of the violation would be established.
In the instant matter, Mr. Sutton provides consulting services to BMR, such that
BMR is Mr. Sutton’s client. Given Mr. Sutton’s business relationship with BMR,
pursuant to Section 1103(a) of the Ethics Act, Mr. Sutton generally would have a conflict
of interest in matters before the Board that would financially impact BMR. Per the
submitted facts, the granting or denying of the Conditional Use Application may
financially impact BMR by increasing or decreasing the value of BMR’s lease interests
with the Applicant(s). Additionally, successful drilling at the Lansberry Property may
result in a financial gain to BMR through horizontal extension(s) from the vertical well or
the drilling of new well(s). Therefore, you are advised that unless the class/subclass
exclusion would be applicable, Mr. Sutton would have a conflict of interest pursuant to
Section 1103(a) of the Ethics Act as to the Conditional Use Application.
Mr. Ide has a signed lease with WhitMar for the drilling and removal of natural
gas from property that Mr. Ide owns. Per the submitted facts, the granting or denying of
the Conditional Use Application may financially impact Mr. Ide by increasing or
decreasing the value of Mr. Ide’s lease interests. Additionally, successful drilling at the
Lansberry Property may result in a financial gain to Mr. Ide through the drilling of new
well(s). Therefore, you are advised that unless the class/subclass exclusion would be
applicable, Mr. Ide would have a conflict of interest pursuant to Section 1103(a) of the
Ethics Act as to the Conditional Use Application.
In the instant matter, based upon the submitted facts, it cannot be determined
whether the class/subclass exclusion would be applicable, and it would be difficult, if not
impossible, to establish in advance the applicability of said exclusion. Based upon the
submitted facts, Mr. Sutton and Mr. Ide would each have a sufficient basis for assuming
that he has a conflict of interest pursuant to Section 1103(a) of the Ethics Act and
proceeding in conformity with Section 1103(j) of the Ethics Act.
Haley, 10-561
April 1, 2010
Page 10
With respect to Section 1103(j) of the Ethics Act, you are advised that when two
members on a three-member board would have conflicts of interest, only the non-
conflicted member could make a motion. Since the non-conflicted member could not
second his/her own motion and it would be otherwise impossible to obtain a second to
the motion, either of the two conflicted members, having previously abstained and
disclosed his/her conflict, could then second the motion if he or she would so choose.
The two conflicted members could not discuss or advocate as to the motion. The two
conflicted members could only vote on the motion. Cf., Confidential Opinion, 04-003.
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 Second Class Township Code.
Conclusion:
As Supervisors for Lehman Township (“Township”), and as
Members of the Township Planning Commission (a decision-making board), David H.
Sutton (“Mr. Sutton”) and Douglas W. Ide (“Mr. Ide”) are public officials subject to the
provisions of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. §
1101 et seq. Under the submitted facts that: (1) there is pending before the Township
Board of Supervisors a conditional use application (“the Conditional Use Application”)
submitted by WhitMar Exploration Company (“WhitMar”) and EnCana Oil and Gas USA,
Inc. (“EnCana”), hereinafter collectively referred to as “the Applicants,” seeking approval
for the drilling of a commercial natural gas well on certain real property owned by
Russell and Larry Lansberry, hereinafter referred to as “the Lansberry Property”; (2) in
a private capacity, Mr. Sutton has an ongoing business relationship with Back Mountain
Recreation, Inc. (“BMR”) whereby Mr. Sutton provides consultant services to BMR; (3)
BMR has signed a lease with the Applicant(s) allowing gas to be removed from under
BMR’s property; (4) the granting or denying of the Conditional Use Application may
financially impact BMR by increasing or decreasing the value of BMR’s lease interests
with the Applicant(s); (5) successful drilling at the Lansberry Property may result in a
financial gain to BMR through horizontal extension(s) from the vertical well or the drilling
of new well(s); (6) Mr. Ide has a signed lease with WhitMar for the drilling and removal
of natural gas from property that Mr. Ide owns; (7) the granting or denying of the
Conditional Use Application may financially impact Mr. Ide by increasing or decreasing
the value of Mr. Ide’s lease interests; and (8) successful drilling at the Lansberry
Property may result in a financial gain to Mr. Ide through the drilling of new well(s), you
are advised as follows.
Unless the class/subclass exclusion to the definition of “conflict” or “conflict of
interest” as set forth in Section 1102 of the Ethics Act, 65 Pa.C.S. § 1102, would be
applicable, Mr. Sutton and Mr. Ide would each have a conflict of interest pursuant to
Section 1103(a) of the Ethics Act as to the Conditional Use Application. In the instant
matter, based upon the submitted facts, it cannot be determined whether the
class/subclass exclusion would be applicable, and it would be difficult, if not impossible,
to establish in advance the applicability of said exclusion. Based upon the submitted
facts, Mr. Sutton and Mr. Ide would each have a sufficient basis for assuming that he
has a conflict of interest pursuant to Section 1103(a) of the Ethics Act and proceeding in
conformity with Section 1103(j) of the Ethics Act. With respect to Section 1103(j) of the
Ethics Act, when two members on a three-member board would have conflicts of
interest, only the non-conflicted member could make a motion. Since the non-conflicted
member could not second his/her own motion and it would be otherwise impossible to
obtain a second to the motion, either of the two conflicted members, having previously
abstained and disclosed his/her conflict, could then second the motion if he or she
would so choose. The two conflicted members could not discuss or advocate as to the
motion. The two conflicted members could only vote on the motion.
Haley, 10-561
April 1, 2010
Page 11
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
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