HomeMy WebLinkAbout12-526 Say
ADVICE OF COUNSEL
April 12, 2012
Brooke E. D. Say, Esquire
Stock and Leader
Susquehanna Commerce Center East
221 W. Philadelphia Street-Suite 600
York, PA 17401-2994
12-526
Dear Ms. Say:
This responds to your letter of February 20, 2012, 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 school
director who, in a private capacity, is an independent contractor of a business that
provides gym shirts (uniforms) for the school district that the school director serves.
Facts:
As Solicitor for the South Eastern School District (“School District”),
located in York County, Pennsylvania, you have been authorized by Karrie Strickland
(“Ms. Strickland”), who is a School Director for the School District, to request an
advisory from the Pennsylvania State Ethics Commission on her behalf. You have
submitted facts that may be fairly summarized as follows.
In a private capacity, Ms. Strickland is an independent contractor of a business
named “Your Image and More” (“Your Image”). Ms. Strickland’s second cousin is the
sole owner of Your Image. The School District currently contracts with Your Image for
the production of gym shirts (uniforms). Between July 1, 2011, and January 24, 2012,
the School District spent approximately $1,565.20 for products offered by Your Image.
Ms. Strickland was elected as a School Director for the School District in
November 2011, and she was sworn into office in December 2011. You state that
although Ms. Strickland was the account manager for the School District’s gym shirt
orders in the past, she no longer manages the School District’s accounts with Your
Image. You further state that Ms. Strickland has not received compensation for School
District accounts with Your Image since she became a School Director and that she no
longer receives compensation for such accounts.
You state that it is Ms. Strickland’s intent to take the following steps:
(1) Remain an independent contractor of Your Image but not be assigned to
School District accounts or receive any remuneration from those accounts;
Say, 12-526
April 12, 2012
Page 2
(2) Abstain from any Board vote on invoices from or contracts with Your
Image in any amount;
(3) Insist that the School District provide prior public notice of any continued
contracting with Your Image (list the contract on the public board agendas,
post that agenda publicly, make the agenda publicly available in advance
of the meeting) and award any contract through a public meeting with
public comment prior to the vote, with minutes reflecting that the contract
was awarded;
(4) Insist that the School District comply with requirements for bidding and
quoting, such that the School Board minutes reflect that other companies
were considered and that price quotes were obtained prior to the School
Board’s public vote if required by law;
(5) Insist that the School District provide public disclosure of all proposals
considered and contracts awarded with respect to goods provided by Your
Image; and
(6) Abstain from any supervisory or overall responsibility for the
implementation of any contracts between Your Image and the School
District, including abstaining from any future discussion or decisions
regarding the implementation or performance of the contract.
You seek guidance as to whether the above steps proposed by Ms. Strickland
would provide sufficient compliance with her ethical obligations.
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.
As a School Director for the School District, Ms. Strickland is a public official as
that term is defined in the Ethics Act, and therefore she is 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
Say, 12-526
April 12, 2012
Page 3
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:
§ 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.
Say, 12-526
April 12, 2012
Page 4
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.
The Pennsylvania Supreme Court has held that in order to violate Section
1103(a) of the Ethics Act, a public official/public employee “must be consciously aware
of a private pecuniary benefit for himself, his family, or his business, and then must take
action in the form of one or more specific steps to attain that benefit.” Kistler v. State
Ethics Commission, Pa. , , 22 A.3d 223, 231 (2011).
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, inter alia, an
agreement or arrangement for the acquisition, use or disposal by a political subdivision
of consulting or other services or of supplies, materials, equipment, land or other
personal or real property. 65 Pa.C.S. § 1102.
It is administratively noted that the Public School Code of 1949 as amended
(“Public School Code”) provides in pertinent part:
Say, 12-526
April 12, 2012
Page 5
§ 3-324. Not to be employed by or do business with
district; exceptions
(a) No school director shall, during the term for which he
was elected or appointed, as a private person engaged in
any business transaction with the school district in which he
is elected or appointed, be employed in any capacity by the
school district in which he is elected or appointed, or receive
from such school district any pay for services rendered to the
district except as provided in this act…
….
(c) It shall not be a violation of this section for a school
district to contract for the purchase of goods or services from
a business with which a school director is associated to the
extent permitted by and in compliance with 65 Pa.C.S. Ch.
11 (relating to ethics standards and financial disclosure).
24 P.S. §§ 3-324(a), (c). On its face, Section 3-324(c) of the Public School Code
permits contracting between school districts and businesses with which school directors
are associated as long as the requirements of the Ethics Act are observed.
In applying the above provisions of the Ethics Act to your inquiry, it is initially
noted that Your Image is not a business with which Ms. Strickland is associated as the
Ethics Act defines that term. This is because, based upon the submitted facts, Ms.
Strickland is not a director, officer, owner, employee, or holder of a financial interest in
Your Image.
Because Your Image is not a business with which Ms. Strickland is associated,
Section 1103(f) of the Ethics Act would not apply as to contract(s) between Your Image
and the School District.
As for Section 1103(a) of the Ethics Act, 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), or 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). Ms. Strickland has an ongoing business relationship with Your Image.
Therefore, matter(s) before the School District School Board involving Your Image could
present a conflict of interest for Ms. Strickland. Specifically, Ms. Strickland would
transgress Section 1103(a) of the Ethics Act by voting or otherwise participating in her
official capacity on matter(s) before the School District School Board involving Your
Image to the extent that: (1) she would be consciously aware of a private pecuniary
benefit for herself, a member of her immediate family, or a business with which she or a
member of her immediate family is associated; and (2) her action would constitute one
or more specific steps to attain that benefit (Kistler, supra).
In each instance of a conflict of interest, Ms. Strickland 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.
As for the six steps listed above that Ms. Strickland proposes to take so as to
comply with the Ethics Act, you are advised that steps one, two, and six would be
beneficial in avoiding potential conflicts of interest, while steps three, four and five would
not be required due to the inapplicability of Section 1103(f) of the Ethics Act under the
submitted facts.
Say, 12-526
April 12, 2012
Page 6
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 School Director for the South Eastern School District (“School
District”), located in York County, Pennsylvania, Karrie Strickland (“Ms. Strickland”) 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) in a
private capacity, Ms. Strickland is an independent contractor of a business named “Your
Image and More” (“Your Image”); (2) Ms. Strickland’s second cousin is the sole owner
of Your Image; (3) the School District currently contracts with Your Image for the
production of gym shirts (uniforms); (4) between July 1, 2011, and January 24, 2012,
the School District spent approximately $1,565.20 for products offered by Your Image;
(5) Ms. Strickland was elected as a School Director for the School District in November
2011, and she was sworn into office in December 2011; (6) although Ms. Strickland was
the account manager for the School District’s gym shirt orders in the past, she no longer
manages the School District’s accounts with Your Image; and (7) Ms. Strickland has not
received compensation for School District accounts with Your Image since she became
a School Director, and she no longer receives compensation for such accounts, you are
advised as follows.
Your Image is not a business with which Ms. Strickland is associated as the
Ethics Act defines that term because, based upon the submitted facts, Ms. Strickland is
not a director, officer, owner, employee, or holder of a financial interest in Your Image.
Because Your Image is not a business with which Ms. Strickland is associated, Section
1103(f) of the Ethics Act would not apply as to contract(s) between Your Image and the
School District. Due to Ms. Strickland’s ongoing business relationship with Your Image,
matter(s) before the School District School Board involving Your Image could present a
conflict of interest for Ms. Strickland. Ms. Strickland would transgress Section 1103(a)
of the Ethics Act by voting or otherwise participating in her official capacity on matter(s)
before the School District School Board involving Your Image to the extent that: (1) she
would be consciously aware of a private pecuniary benefit for herself, a member of her
immediate family, or a business with which she or a member of her immediate family is
associated; and (2) her action would constitute one or more specific steps to attain that
benefit. In each instance of a conflict of interest, Ms. Strickland 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.
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
Say, 12-526
April 12, 2012
Page 7
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