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HomeMy WebLinkAbout10-622 ADVICE OF COUNSEL November 1, 2010 Ronald Daniels Chief Information Officer Office of Information Technology Labor and Industry Building Seventh and Forster Streets Harrisburg, PA 17120 10-622 Dear Mr. Daniels: This responds to your letter dated September 22, 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 the Chief Information Officer for the Pennsylvania Department of Labor and Industry (“Department of Labor and Industry”) with regard to working as a consultant for the Pennsylvania Center for Health Careers within the Department of Labor and Industry, where such work would be performed: (1) as supplementary employment to his current position with the Department of Labor and Industry; (2) while on paid leave from his current position with the Department of Labor and Industry; or (3) while on temporary leave after stepping down from his current position with the Department of Labor and Industry. Facts: You have requested an advisory from the Pennsylvania State Ethics Commission based upon submitted facts, the material portion of which may be fairly summarized as follows. You are currently employed as the Chief Information Officer for the Department of Labor and Industry. You have submitted a copy of your official Commonwealth position description, which document is incorporated herein by reference. It is noted that said position description lists your job title as Chief Information Officer 3. A copy of the job classification specifications for the position of Chief Information Officer 3 (job code 01553) has been obtained and is also incorporated herein by reference. The Pennsylvania Center for Health Careers (“CHC”) is established within the Department of Labor and Industry. You state that the CHC seeks to engage a consultant (“the Consultant”) for the nine-month period from October 1, 2010, to June 30, 2011. You state that the Consultant would aid a board of healthcare professionals from across the Commonwealth in addressing the increased need for Information Technology (“IT”) workers in the healthcare industry in the upcoming year. The tasks involved would include, inter alia, working with educational institutions to create a Daniels, 10-622 November 1, 2010 Page 2 curriculum that would address the need for such workers and identifying funding at the federal level that would assist in the training and education of such workers. You state that the Consultant would report to David Ranck (“Mr. Ranck”), who is the interim Executive Director of the CHC. You further state that the Consultant would report to the Chairman of the Committee on Health IT Careers (“the Committee”) and to the chair of a subcommittee (“the Subcommittee”) of one of the Commonwealth’s Workforce Investment Boards (“the Workforce Investment Board”). The submitted facts do not indicate the nature of the relationship(s), if any, among Mr. Ranck, the Committee, and/or the Sub-Committee. You state that in your current position as Chief Information Officer, you report to the Deputy Chief Information Officer for the Governor’s Office of Administration, and that you have no direct or indirect connection to the Workforce Investment Board. You further state that you have not been involved in any discussions about the CHC’s need for the Consultant and that you do not have any affiliations with the CHC. You express your view that neither the State Adverse Interest Act nor the Governor’s Code of Conduct would prohibit you from working as the Consultant for the CHC. Based upon the above submitted facts, you seek guidance as to whether the Ethics Act would permit you to work as the Consultant for the CHC where you would perform such work: (1) as supplementary employment to your current position with the Department of Labor and Industry; (2) while on paid leave from your current position with the Department of Labor and Industry; or (3) while on temporary leave after stepping down from your current position with the Department of Labor and Industry. 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. 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. As the Chief Information Officer for the Department of Labor and Industry, you are a public employee subject to the provisions of the Ethics Act. This conclusion is based upon the position description and the job classification specifications, which when reviewed on an objective basis, indicate clearly that the power exists to take or recommend official action of a non-ministerial nature with respect to one or more of the following: contracting; procurement; administering or monitoring grants or subsidies; planning or zoning; inspecting; licensing; regulating; auditing; or other activity(ies) where the economic impact is greater than de minimis on the interests of another person. Sections 1103(a) and 1103(j) of the Ethics Act provide: Daniels, 10-622 November 1, 2010 Page 3 § 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. "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. Daniels, 10-622 November 1, 2010 Page 4 "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. The use of authority of office is not limited merely to voting, but extends 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. 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 to include an agreement or arrangement for the acquisition or use by the Commonwealth of consulting services. 65 Pa.C.S. § 1102. Daniels, 10-622 November 1, 2010 Page 5 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. 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). 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. 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 the Chief Information Officer for the Department of Labor and Industry 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. In response to your specific question, you are advised as follows. Subject to the conditions that there would be no use of the authority of your public position--or confidential information accessed/received by being in your public position--in furtherance of obtaining work or providing services as the Consultant, Section 1103(a) of the Ethics Act would not prohibit you in your private capacity from serving as the Consultant for the CHC where you would perform such work: (1) as supplementary employment to your current position with the Department of Labor and Industry; or (2) while on leave from your current position with the Department of Labor and Industry. However, in your public capacity as the Chief Information Officer for the Department of Labor and Industry, you would have a conflict of interest in matters that would financially impact the CHC. 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 Daniels, 10-622 November 1, 2010 Page 6 requirements of Section 1103(j) of the Ethics Act would have to be satisfied in the event of a voting conflict. The restrictions and requirements of Section 1103(f) of the Ethics Act would have to be observed whenever applicable. As for “stepping down” from your current position with the Department of Labor and Industry, you are advised that if your employment status would change such that you would be considered a former public employee as to the Governor’s Office of Administration or the Department of Labor and Industry, then you would be subject to the restrictions of Section 1103(g) of the Ethics Act, which provides as follows: § 1103. Restricted activities (g) Former official or employee.-- No former public official or public employee shall represent a person, with promised or actual compensation, on any matter before the governmental body with which he has been associated for one year after he leaves that body. 65 Pa.C.S. § 1103(g). During the one-year period of applicability of Section 1103(g) of the Ethics Act, Section 1103(g) would, inter alia, prohibit you from contracting with your former governmental body to provide consulting services. Cf., e.g., Shaub, Order 1242; Confidential Opinion, 97-008; Confidential Opinion, 93-005. 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 Governor’s Code of Conduct or the State Adverse Interest Act. Conclusion: As the Chief Information Officer for the Pennsylvania Department of Labor and Industry (“Department of Labor and Industry”), you are a public employee 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 Pennsylvania Center for Health Careers (“CHC”) is established within the Department of Labor and Industry; (2) the CHC seeks to engage a consultant (“the Consultant”) for the nine- month period from October 1, 2010, to June 30, 2011; (3) the Consultant would aid a board of healthcare professionals from across the Commonwealth in addressing the increased need for Information Technology (“IT”) workers in the healthcare industry in the upcoming year; (4) the tasks involved would include, inter alia, working with educational institutions to create a curriculum that would address the need for such workers and identifying funding at the federal level that would assist in the training and education of such workers; (5) the Consultant would report to the interim Executive Director of the CHC, to the Chairman of the Committee on Health IT Careers, and to the chair of a subcommittee of one of the Commonwealth’s Workforce Investment Boards (“the Workforce Investment Board”); (6) as Chief Information Officer for the Department of Labor and Industry, you have no direct or indirect connection to the Workforce Investment Board; (7) you have not been involved in any discussions about the CHC’s need for the Consultant; and (8) you do not have any affiliations with the CHC, 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 the Chief Information Officer for the Department of Labor and Industry you would have a conflict of interest in matters that would financially Daniels, 10-622 November 1, 2010 Page 7 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. Subject to the conditions that there would be no use of the authority of your public position--or confidential information accessed/received by being in your public position--in furtherance of obtaining work or providing services as the Consultant, Section 1103(a) of the Ethics Act would not prohibit you in your private capacity from serving as the Consultant for the CHC where you would perform such work: (1) as supplementary employment to your current position with the Department of Labor and Industry; or (2) while on leave from your current position with the Department of Labor and Industry. However, in your public capacity as the Chief Information Officer for the Department of Labor and Industry, you would have a conflict of interest in matters that would financially impact the CHC. 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 restrictions and requirements of Section 1103(f) of the Ethics Act would have to be observed whenever applicable. As for “stepping down” from your current position with the Department of Labor and Industry, you are advised that if your employment status would change such that you would be considered a former public employee as to the Governor’s Office of Administration or the Department of Labor and Industry, then you would be subject to the restrictions of Section 1103(g) of the Ethics Act. During the one-year period of applicability of Section 1103(g) of the Ethics Act, Section 1103(g) would, inter alia, prohibit you from contracting with your former governmental body to provide consulting services. 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