HomeMy WebLinkAbout10-605 Polites
ADVICE OF COUNSEL
August 19, 2010
Timothy J. Polites
212 Back Road
P.O. Box 244
Elmora, PA 15737
10-605
Dear Mr. Polites:
This responds to your letter dated July 12, 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 a township
supervisor, who in a private capacity is a general contractor, with regard to contracting
with the township to perform work on a township roof project.
Facts:
You are a Supervisor for West Carroll Township (“Township”), located in
Cambria County, Pennsylvania. It is administratively noted that the Township Board of
Supervisors (“Board”) is a three-Member Board. You request an advisory from the
Pennsylvania State Ethics Commission based upon the following submitted facts.
In a private capacity, you are a general contractor. The Township is currently
seeking to enter into a contract (“the Proposed Contract”) for a Township roof project
(“the Project”).
You state that on May 3, 2010, you participated in a Board vote to advertise for
bids for the Project. You contacted the Township engineers to set up a meeting to get
engineered drawings for the Project. You state that you did not meet with the engineers
but another Township Supervisor did. You did not bid on the Project. At a Board
meeting in June 2010, you abstained from a vote by which the Board rejected the only
bid received for the Project. Your stated reason for abstaining was that you might bid
on the Project if it was re-advertised.
Subsequently, at the same June 2010 meeting, the Board voted to re-advertise
for bids for the Project. Supervisor Bassett made the motion to re-advertise the Project.
You state that you initially abstained. However, when Supervisor Taylor would not
second the motion, you seconded the motion based upon the advice of the Township
Solicitor. Supervisor Bassett voted in favor of the motion, Supervisor Taylor voted
against the motion, and you voted in favor of the motion.
Polites, 10-605
August 19, 2010
Page 2
Based upon the above submitted facts, you ask whether the Ethics Act would
permit you to bid on the Proposed Contract.
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. 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.
As a Township Supervisor, 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 related to Section 1103(a) are defined in the Ethics Act as
follows:
Polites, 10-605
August 19, 2010
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.
"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.
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.
Polites, 10-605
August 19, 2010
Page 4
In each instance of a conflict of interest, a public official/public employee would
be required to abstain from participation, which would include voting unless one of the
statutory exceptions of Section 1103(j) of the Ethics Act would be applicable.
Additionally, the disclosure requirements of Section 1103(j) of the Ethics Act would have
to be satisfied in the event of a voting conflict.
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
may not have any supervisory or overall responsibility as to the implementation or
administration of the contract with the governmental body.
Polites, 10-605
August 19, 2010
Page 5
In applying the above provisions of the Ethics Act to the instant matter, you are
advised that any business as to which you are a director, officer, owner, or employee or
in which you have a financial interest would be considered a business with which you
are associated. A sole proprietorship or self-employed individual is included within the
definition of the term “business” as set forth in the Ethics Act. 65 Pa.C.S. § 1102; In Re:
Nomination Petition of Paulmier, 594 Pa. 433, 937 A.2d 364 (2007).
Subject to the statutory exceptions to the definition of “conflict” or “conflict of
interest” as set forth in the Ethics Act, 65 Pa.C.S. § 1102, pursuant to Section 1103(a)
of the Ethics Act, in your capacity as a Township Supervisor, you would have a conflict
of interest in matters that would financially impact you, any business(es) with which you
are associated, or the customer(s)/client(s) of any business(es) with which you are
associated. See, Kannebecker, supra; Miller, supra.
You are further advised that the Ethics Act itself would not prohibit you, in your
private capacity as a general contractor, from seeking to enter into a contract to perform
work for the Township, including the Proposed Contract. However, in your public
capacity as a Township Supervisor, you would have a conflict of interest under Section
1103(a) of the Ethics Act in matters pertaining to actual or anticipated contract(s)
between the Township and you/your business.
You would also be prohibited from using the authority of your public position, or
confidential information accessed or received as a result of being a Township
Supervisor, to effectuate a private pecuniary benefit to you/your business through a
detriment to a business competitor. See, Pepper, Opinion 87-008.
In addition, you generally would have a conflict of interest with respect to voting
to approve the payment of any bills or invoices that would be submitted by you/your
business to the Township.
As noted above, in each instance of a conflict of interest, you would be required
to abstain from participation, which would include voting unless one of the statutory
exceptions of Section 1103(j) of the Ethics Act would be applicable. Additionally, the
disclosure requirements of Section 1103(j) of the Ethics Act would have to be satisfied
in the event of a voting conflict.
The requirements of Section 1103(f) of the Ethics Act would have to be observed
whenever applicable.
The contracting in question would not be prohibited under the Ethics Act itself
where the restrictions and requirements of Sections 1103(a), 1103(f), and 1103(j) of the
Ethics Act would be observed.
It is administratively noted that the Second Class Township Code provides in
pertinent part:
§ 68102. Letting contracts
. . . .
(i) No township official, either elected or appointed, or
township employe who knows, or who by the exercise of
reasonable diligence could know, shall be interested to any
appreciable degree, either directly or indirectly, in any
contract for the sale or furnishing of any supplies or
materials for the use of the township or for any work to be
done for the township involving the payment by the township
of more than five hundred dollars ($500) in any year unless
the contract is awarded through the public bid process. This
Polites, 10-605
August 19, 2010
Page 6
limitation does not apply if the officer or appointee of the
township is an employe of the person, firm or corporation to
which the money is to be paid in a capacity with no possible
influence on the transaction and the officer cannot possibly
be benefited thereby, either financially or otherwise. If a
supervisor is within this exception, the supervisor shall so
inform the board of supervisors and refrain from voting on
the payments and shall in no manner participate in the
contract. Any official or appointee who knowingly violates
this provision is subject to surcharge to the extent of the
damage shown to be sustained by the township, is ousted
from office or employment and commits a misdemeanor of
the third degree.
53 P.S. §? 68102(i).
Because this Advice may not interpret the above quoted provision of the Second
Class Township Code, it is suggested that you seek legal advice in that regard.
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.
Conclusion:
As a Supervisor for West Carroll Township (“Township”), located in
Cambria County, Pennsylvania, 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) in a private capacity, you are a general contractor;
and (2) the Township is currently seeking to enter into a contract (“the Proposed
Contract”) for a Township roof project, you are advised as follows.
Subject to the statutory exceptions to the definition of “conflict” or “conflict of
interest” as set forth in the Ethics Act, 65 Pa.C.S. § 1102, pursuant to Section 1103(a)
of the Ethics Act, in your capacity as a Township Supervisor, you would have a conflict
of interest in matters that would financially impact you, any business(es) with which you
are associated, or the customer(s)/client(s) of any business(es) with which you are
associated. The Ethics Act itself would not prohibit you, in your private capacity as a
general contractor, from seeking to enter into a contract to perform work for the
Township, including the Proposed Contract. However, in your public capacity as a
Township Supervisor, you would have a conflict of interest under Section 1103(a) of the
Ethics Act in matters pertaining to actual or anticipated contract(s) between the
Township and you/your business. You would also be prohibited from using the authority
of your public position, or confidential information accessed or received as a result of
being a Township Supervisor, to effectuate a private pecuniary benefit to you/your
business through a detriment to a business competitor. You generally would have a
conflict of interest with respect to voting to approve the payment of any bills or invoices
that would be submitted by you/your business to the Township. In each instance of a
conflict of interest, you would be required to abstain from participation, which would
include voting unless one of the statutory exceptions of Section 1103(j) of the Ethics Act
would be applicable. Additionally, the disclosure requirements of Section 1103(j) of the
Ethics Act would have to be satisfied in the event of a voting conflict. The requirements
of Section 1103(f) of the Ethics Act would have to be observed whenever applicable.
The contracting in question would not be prohibited under the Ethics Act itself where the
restrictions and requirements of Sections 1103(a), 1103(f), and 1103(j) of the Ethics Act
would be observed. It is suggested that you seek legal advice as to the applicability of
the Second Class Township Code. Lastly, the propriety of the proposed conduct has
only been addressed under the Ethics Act.
Polites, 10-605
August 19, 2010
Page 7
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