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HomeMy WebLinkAbout10-586-S Racunas ADVICE OF COUNSEL August 25, 2010 Matthew D. Racunas, Esquire Law Offices of Patricia L. McGrail, LLC 1714 Lincoln Way White Oak, PA 15131 10-586-S Dear Mr. Racunas: This responds to your letter dated July 13, 2010, by which you requested supplemental advice 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 borough council member, who in a private capacity is a member of a non-profit organization, with regard to voting on a motion to permit the non-profit organization to use a vacant parcel of property owned by the borough, where: (1) the non-profit organization would install a small log cabin structure or kiosk on the property; (2) the intended use of the structure would be to provide information promoting the borough and its local businesses; (3) the non-profit organization would pay for the structure; (4) the non-profit organization would not pay any compensation to the borough for the use of the parcel of property but would agree to indemnify the borough should any claims arise; and (5) the spouse of the borough council member is employed as an administrator with the non-profit organization. Facts: By letters dated April 16, 2010, and May 7, 2010, you submitted an initial request for an advisory from the Pennsylvania State Ethics Commission. In response to your initial advisory request, Racunas, Advice 10-586 was issued to you on June 9, 2010, which Advice is incorporated herein by reference. Advice of Counsel 10-586 determined, in pertinent part, as follows: As a Member of Council for the Borough of Harmony (“Borough”), Frank Luek (“Mr. Luek”) is 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) the Borough owns a triangular shaped parcel of property (“the Parcel”) that is bounded by two roads; (2) the Parcel is approximately 9,400 square feet in size and is currently vacant; (3) Mr. Luek sits on the board of directors of a local non-profit organization named “Historic Harmony, Inc.” (“Historic Harmony”); (4) Historic Harmony recently approached the Borough for permission to install a small log cabin structure or kiosk (“the Racunas, 10-586-S August 25, 2010 Page 2 Structure”) on the Parcel; (5) the intended use of the Structure would be to provide information that would promote the Borough and its local businesses; (6) Historic Harmony would pay for the Structure; and (7) Historic Harmony does not intend to pay any compensation to the Borough for the use of the Parcel but would agree to indemnify the Borough should any claims arise, you are advised as follows. Historic Harmony is a business with which Mr. Luek is associated in his capacity as a member of Historic Harmony’s board of directors. Subject to the statutory exclusions 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, Mr. Luek would have a conflict of interest in matters before Borough Council that would financially impact Historic Harmony. In each instance of a conflict of interest, Mr. Luek 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. Unless the “de minimis 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, Section 1103(a) of the Ethics Act would prohibit Mr. Luek from voting on the proposed motion to permit Historic Harmony to use the Parcel. Racunas, Advice of Counsel 10-586, at 4. In your July 13, 2010, advisory request letter, you state that it has come to your attention that Mr. Luek is not now and never has been a member of the board of directors of Historic Harmony. You state that Mr. Luek has always been only a member of Historic Harmony. You further state that Mr. Luek’s spouse is employed as an administrator with Historic Harmony. In light of the above additional facts, you request a supplemental advisory. 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 having incorporated herein by reference Racunas, Advice of Counsel 10-586, this Supplemental Advice will not reiterate at length the quotations, citations and commentary as to the Ethics Act set forth within the Advice. In considering the additional submitted facts, the following term related to Section 1103(a) of the Ethics Act is pertinent to your inquiry: § 1102. Definitions "Immediate family." A parent, spouse, child, brother or sister. Racunas, 10-586-S August 25, 2010 Page 3 65 Pa.C.S. § 1102. Based upon the additional submitted facts, you are advised as follows. Mr. Luek’s spouse is a member of his immediate family as that term is defined in the Ethics Act. Historic Harmony is a business with which Mr. Luek’s spouse is associated in her capacity as an employee of Historic Harmony. Therefore, subject to the statutory exclusions 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, Mr. Luek would have a conflict of interest in matters before Borough Council that would financially impact Historic Harmony. You are advised that unless the de minimis exclusion would be applicable, Section 1103(a) of the Ethics Act would prohibit Mr. Luek from voting on the proposed motion to permit Historic Harmony to use the vacant parcel of land owned by the Borough that is the subject of the submitted facts of Advice of Counsel 10-586. As noted by Advice of Counsel 10-586, in each instance of a conflict of interest, Mr. Luek 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. The propriety of the proposed conduct has only been addressed under the Ethics Act. Conclusion: As a Member of Council for the Borough of Harmony (“Borough”), Frank Luek (“Mr. Luek”) is 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 additional submitted facts that: (1) Mr. Luek is not now and never has been a member of the board of directors of a local non-profit organization named “Historic Harmony, Inc.” (“Historic Harmony”), and he has always been only a member of Historic Harmony; and (2) Mr. Luek’s spouse is employed as an administrator with Historic Harmony, you are advised as follows. Mr. Luek’s spouse is a member of his “immediate family” as that term is defined by the Ethics Act. Historic Harmony is a business with which Mr. Luek’s spouse is associated in her capacity as an employee of Historic Harmony. Therefore, subject to the statutory exclusions 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, Mr. Luek would have a conflict of interest in matters before Borough Council that would financially impact Historic Harmony. Unless the de minimis exclusion would be applicable, Section 1103(a) of the Ethics Act would prohibit Mr. Luek from voting on the proposed motion to permit Historic Harmony to use the vacant parcel of land owned by the Borough that is the subject of the submitted facts of Advice of Counsel 10-586. In each instance of a conflict of interest, Mr. Luek 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. The propriety of the proposed conduct has only been addressed under the Ethics Act. Pursuant to Section 1107(11), 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. Racunas, 10-586-S August 25, 2010 Page 4 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