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HomeMy WebLinkAbout10-560-S Confidential ADVICE OF COUNSEL September 30, 2010 10-560-S This responds to your letter dated August 16, 2010, by which you requested supplemental advice from the Pennsylvania State Ethics Commission. Issue: Whether, pursuant to the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. §1101 et seq., a state legislator would be permitted to provide, either directly or through district office staff, information to constituent(s) regarding a certain project of a nonprofit corporation for which the state legislator serves as a board member, when, in the near future, said project will impose [an initial type of fee] of [amount 1] and [a subsequent type of fee] of [amount 2] upon individuals who seek assistance from the project. Facts: By letter dated February 8, 2010, you submitted an initial request for a confidential advisory from the Pennsylvania State Ethics Commission. In response to your initial advisory request, Confidential Advice, 10-560 was issued to you on March 30, 2010. Advice of Counsel 10-560 was based upon the following submitted facts: You have been authorized to request a confidential advisory from the Pennsylvania State Ethics Commission on behalf of State Legislator A, hereinafter referred to as “the State Legislator.” You have submitted facts, the material portion of which may be fairly summarized as follows. The State Legislator is a board member of a nonprofit corporation known as [name of nonprofit corporation], hereinafter referred to as “the Nonprofit.” The primary project of the Nonprofit is known as [name of project], hereinafter referred to as “the Project.” The Project involves [type of effort by various individuals and entities]. The narrow question that you have posed is whether the State Legislator would be permitted to provide, either directly or through district office staff, information regarding the Project to constituent(s) who come into the State Legislator’s office and do not have B. Confidential Advice, 10-560, at 1. Confidential Advice, 10-560-S September 30, 2010 Page 2 Advice of Counsel 10-560 determined that the State Legislator is a public official subject to the provisions of the Ethics Act. The Advice further determined that the submitted facts did not indicate whether the proposed action of providing information to constituent(s) regarding the Project would result in a pecuniary benefit that would be contrary to Section 1103(a) of the Ethics Act. The Advice concluded that pursuant to Section 1103(a) of the Ethics Act, the State Legislator would not be prohibited from providing, either directly or through district office staff, information regarding the Project to constituent(s) who come into the State Legislator’s office and do not have B, subject to the condition that such actions would not result in a pecuniary benefit to the State Legislator, a member of his immediate family, or a business with which the State Legislator or a member of his immediate family is associated such as the Nonprofit. In your August 16, 2010, advisory request letter, you submitted the following additional facts. In the near future, the Project will impose [an initial type of fee] of [amount 1] and [a subsequent type of fee] of [amount 2] upon individuals who seek assistance from the Project. In addition to the aforementioned fees, the Project provides that a C who obtains services from a D under the Project is subject to a [amount and type of payment] which is kept by the D. You state that a D has the discretion to waive such payment. You state that the aforesaid fees and payments do not and will not completely offset the operational costs of the Project. You further state that the Project remains dependent on donations of money from benefactors as well as donations of services by area Ds. In light of the above additional facts, you request a supplemental advisory as to whether the State Legislator would be permitted to provide, either directly or through district office staff, information regarding the Project to constituent(s) who come into the State Legislator’s office and do not have B. 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. This Supplemental Advice incorporates herein by reference the quotations, citations and commentary as to the Ethics Act set forth within Confidential Advice, 10- 560. In considering the additional submitted facts, it is noted that the statutory definition of “conflict” or “conflict of interest” as set forth in the Ethics Act, 65 Pa.C.S. § 1102, contains, in pertinent part, an exclusion referred to herein as the “de minimis 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. Confidential Advice, 10-560-S September 30, 2010 Page 3 The Commission has determined the applicability of the de minimis exclusion on a case-by-case basis, considering all relevant circumstances. In the past, the Commission has found amounts ranging from $2 to approximately $500 to be de minimis. See, Bixler v. State Ethics Commission, 847 A.2d 785 (Pa. Cmwlth. 2004). However, you are cautioned that an economic impact may aggregate over time, rather than be limited to a particular increment of time such as a month or year. Confidential Opinion, 05-001. For multiple transactions, the aggregate financial benefit received from such transactions should be considered in order to determine whether the de minimis exclusion could have applicability. Based upon the additional submitted facts, you are advised as follows. The proposed action of providing information to constituent(s) regarding the Project could result in a pecuniary benefit to the Nonprofit in the nature of fees imposed by the Project upon such individual(s) who would seek assistance from the Project. You are advised that unless the de minimis exclusion would be applicable, Section 1103(a) of the Ethics Act would prohibit the State Legislator from providing, either directly or through district office staff, information regarding the Project to constituent(s) who come into the State Legislator’s office and do not have B. The propriety of the proposed conduct has only been addressed under the Ethics Act. Conclusion: As a state legislator, State Legislator A, hereinafter referred to as “the State Legislator,” 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 State Legislator is a board member of a nonprofit corporation known as [name of nonprofit corporation], hereinafter referred to as “the Nonprofit”; (2) the primary project of the Nonprofit is known as [name of project], hereinafter referred to as “the Project”; (3) the Project involves [type of effort by various individuals and entities]; (4) in the near future, the Project will impose [an initial type of fee] of [amount 1] and [a subsequent type of fee] of [amount 2] upon individuals who seek assistance from the Project; (5) in addition to the aforementioned fees, the Project provides that a C who obtains services from a D under the Project is subject to a [amount and type of payment] which is kept by the D; (6) a D has the discretion to waive such payment; (7) the aforesaid fees and payments do not and will not completely offset the operational costs of the Project; and (8) the Project remains dependent on donations of money from benefactors as well as donations of services by area Ds, you are advised as follows. The proposed action of providing information to constituent(s) regarding the Project could result in a pecuniary benefit to the Nonprofit in the nature of fees imposed by the Project upon such individual(s) who would seek assistance from the Project. Unless the de minimis exclusion to the statutory definition of “conflict” or “conflict of interest” as set forth in the Ethics Act, 65 Pa.C.S. § 1102, would be applicable, Section 1103(a) of the Ethics Act would prohibit the State Legislator from providing, either directly or through district office staff, information regarding the Project to constituent(s) who come into the State Legislator’s office and do not have B. 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. Confidential Advice, 10-560-S September 30, 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