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HomeMy WebLinkAbout12-573 Confidential ADVICE OF COUNSEL November 13, 2012 12-573 This responds to your letter of September 17, 2012, by which you requested a confidential 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 an individual employed as an A with Commonwealth Department B with regard to: (1) performing [type of work] on privately funded projects or for Cs while employed in his current position with Commonwealth Department B; or (2) performing duties for a privately owned [type of firm] within one year of resigning from his current position with Commonwealth Department B. Facts: You request a confidential advisory from the Pennsylvania State Ethics Commission based upon submitted facts that may be fairly summarized as follows. You are employed as an A with Commonwealth Department B in Unit D, in which capacity you serve as the E. You have submitted copies of your official Commonwealth Department B position description and the job classification specifications for the position of A (job code [number]), both of which documents are incorporated herein by reference. You state that some of your primary duties include: [certain activities]. You ask whether the Ethics Act would impose any restrictions upon you with regard to engaging in the following activities while employed in your current position with Commonwealth Department B: (1) Performing [type of work] on privately funded projects if you would carry your own F and would use no information or equipment from Commonwealth Department B; or (2) Performing work for Cs where no state or federal G funding and no H funding would be involved, or where H funding would be utilized. You further seek guidance as to what duties you would be permitted to perform for a privately owned [type of firm] (“Firm”) within one year of resigning from your current Confidential Advice, 12-573 November 13, 2012 Page 2 position with Commonwealth Department B. In particular, you pose the following questions: (1) Whether you could be listed on the Firm’s I on future Commonwealth Department B contracts, which would involve placing your name and work experience in the I; (2) Whether you could perform work for the Firm under a Commonwealth Department B contract and charge for your hours; (3) Whether you could be listed on the Firm’s I on future J contracts, where: (a) Some of such contracts would have Commonwealth Department B oversight due to the federal and state funding involved, and the Cs would select Ks independently from Commonwealth Department B; (b) Such contracts would involve only H funding; or (c) Such contracts would involve no G funding or H funding; (4) Whether you could perform work for the Firm under a J contract and charge for your hours; (5) Whether you could work on [type of projects] that would be advertised by Commonwealth Department B; and (6) Whether the answers to any of the five questions immediately above would change if you would be the only [type of professional] working for the Firm. 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. Pursuant to Section 1103(a) of the Ethics Act, a public official/public employee is prohibited from engaging in conduct that constitutes a conflict of interest: § 1103. Restricted activities (a)Conflict of interest.-- No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa.C.S. § 1103(a). The following terms related to Section 1103(a) are defined in the Ethics Act as follows: Confidential Advice, 12-573 November 13, 2012 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. 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, Opinion 89-011; 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. Confidential Advice, 12-573 November 13, 2012 Page 4 In each instance of a conflict of interest, the public official/public employee would be required to abstain fully from participation. The abstention requirement would not be limited merely to voting, but would extend to any use of authority of office, including, but not limited to, discussing, conferring with others, and advocating for a particular result. Juliante, Order 809. As an A for Commonwealth Department B, you would be considered a “public employee” subject to the Ethics Act and the Regulations of the State Ethics Commission. See, 65 Pa.C.S. § 1102; 51 Pa. Code § 11.1; [cites]. 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. Consequently, upon termination of employment with Commonwealth Department B, you would become a "former public employee" subject to Section 1103(g) of the Ethics Act. While Section 1103(g) does not prohibit a former public official/public employee from accepting a position of employment, it does restrict the former public official/public employee with regard to “representing” a “person” before “the governmental body with which he has been associated”: § 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) (Emphasis added). The terms “represent,” “person,” and "governmental body with which a public official or public employee is or has been associated" are specifically defined in the Ethics Act as follows: § 1102. Definitions "Represent." To act on behalf of any other person in any activity which includes, but is not limited to, the following: personal appearances, negotiations, lobbying and submitting bid or contract proposals which are signed by or contain the name of a former public official or public employee. "Person." A business, governmental body, individual, corporation, union, association, firm, partnership, committee, club or other organization or group of persons. "Governmental body with which a public official or public employee is or has been associated." The governmental body within State government or a political Confidential Advice, 12-573 November 13, 2012 Page 5 subdivision by which the public official or employee is or has been employed or to which the public official or employee is or has been appointed or elected and subdivisions and offices within that governmental body. 65 Pa.C.S. § 1102. The term "Person" is very broadly defined. It includes, inter alia, corporations and other businesses. It also includes the former public official/public employee himself, Confidential Opinion, 93-005, as well as a new governmental employer. Ledebur, Opinion 95-007. The term "represent" is also broadly defined to prohibit acting on behalf of any person in any activity. Examples of prohibited representation include: (1) personal appearances before the former governmental body or bodies; (2) attempts to influence; (3) submission of bid or contract proposals which are signed by or contain the name of the former public official/public employee; (4) participating in any matters before the former governmental body as to acting on behalf of a person; and (5) lobbying. Popovich, Opinion 89-005. Listing one's name as the person who will provide technical assistance on a proposal, document, or bid, if submitted to or reviewed by the former governmental body, constitutes an attempt to influence the former governmental body. Section 1103(g) also generally prohibits the inclusion of the name of a former public official/ public employee on invoices submitted by his new employer to the former governmental body, even if the invoices pertain to a contract that existed prior to termination of service with such governmental body. Shay, Opinion 91-012. However, if such a pre-existing contract does not involve the unit where a former public employee worked, the name of the former public employee may appear on routine invoices if required by the regulations of the agency to which the billing is being submitted. Abrams/Webster, Opinion 95-011. A former public official/public employee may assist in the preparation of any documents presented to his former governmental body. However, the former public official/public employee may not be identified on documents submitted to the former governmental body. The former public official/public employee may also counsel any person regarding that person's appearance before his former governmental body. Once again, however, the activity in this respect should not be revealed to the former governmental body. The Ethics Act would not prohibit or preclude making general informational inquiries to the former governmental body to secure information which is available to the general public, but this must not be done in an effort to indirectly influence the former governmental body or to otherwise make known to that body the representation of, or work for, the new employer. Section 1103(g) only restricts the former public official/public employee with regard to representation before his former governmental body. The former public official/public employee is not restricted as to representation before other agencies or entities. However, the “governmental body with which a public official/public employee is or has been associated” is not limited to the particular subdivision of the agency or other governmental body where the public official/public employee had influence or control but extends to the entire body. See, Legislative Journal of House, 1989 Session, No. 15 at 290, 291; Sirolli, Opinion 90-006; Sharp, Opinion 90-009-R. The governmental body with which you would be deemed to have been associated upon termination of employment with Commonwealth Department B would be Commonwealth Department B in its entirety, including but not limited to Unit D. Confidential Advice, 12-573 November 13, 2012 Page 6 Therefore, for the first year following termination of your employment with Commonwealth Department B, Section 1103(g) of the Ethics Act would apply and restrict “representation” of a “person” before Commonwealth Department B. Having established the above general principles, your two sets of specific questions shall now be addressed. With respect to your first set of specific questions, you are advised that Section 1103(a) of the Ethics Act would not prohibit you, in your private capacity, from performing [type of work] on privately funded projects under your own F or performing work for Cs (regardless of the project funding sources) subject to the condition that in your public position as an A for Commonwealth Department B, you would fully comply with Section 1103(a) of the Ethics Act. Section 1103(a) of the Ethics Act would prohibit you from using the authority of your public position, or confidential information received by being in your public position, in furtherance of such business activities. Turning to your second set of specific questions, you are advised as follows. With regard to your first question, you are advised that during the first year following termination of your employment with Commonwealth Department B, Section 1103(g) of the Ethics Act would prohibit the inclusion of your name on the Firm’s I(s) on future Commonwealth Department B contract(s) as such would necessarily involve prohibited representation before Commonwealth Department B. In response to your second question, you are advised that Section 1103(g) of the Ethics Act would not prohibit you from doing work for the Firm under Commonwealth Department B contracts during the first year following termination of your employment with Commonwealth Department B subject to the condition that in so doing, you would not engage in prohibited representation before Commonwealth Department B. During the one-year period of applicability of Section 1103(g) of the Ethics Act, as a general rule, your name could not be listed on invoices submitted to Commonwealth Department B by the Firm. However, if you would perform work for the Firm on Commonwealth Department B contracts that existed before you terminated employment with Commonwealth Department B, and if such contracts would not involve the “unit” of Commonwealth Department B where you formerly worked, specifically, Unit D, your name could appear on routine invoices submitted to Commonwealth Department B as to those particular pre-existing contracts if required by the regulations of Commonwealth Department B. See, Abrams/Webster, supra. The ability to include your name on invoices subject to the aforesaid conditions would not impact the applicability of Section 1103(g) of the Ethics Act as to other activities. In response to your third question, you are advised that Section 1103(g) of the Ethics Act would not prohibit the inclusion of your name on the Firm’s I(s) on future J contract(s) subject to the condition that such inclusion would not result in prohibited representation before Commonwealth Department B during the first year following termination of your employment with Commonwealth Department B. In response to your fourth and fifth questions, you are advised that during the first year following termination of your employment with Commonwealth Department B, Section 1103(g) of the Ethics Act would not restrict you from working for the Firm under a J contract and charging for your hours or working on [type of projects] that would be advertised by Commonwealth Department B, subject to the condition that in so doing, you would not engage in any activity(ies) that would constitute prohibited representation before Commonwealth Department B as delineated above. Confidential Advice, 12-573 November 13, 2012 Page 7 In response to your sixth question, you are advised that the above answers to your first five questions would not change if you would be the only [type of professional] working for the Firm. Based upon the facts that have been submitted, this Advice has addressed the applicability of Sections 1103(a) and 1103(g) only. It is noted that Sections 1103(b) and 1103(c) of the Ethics Act provide in part that no person shall offer or give to a public official/public employee anything of monetary value and no public official/public employee shall solicit or accept anything of monetary value based upon the understanding that the vote, official action, or judgment of the public official/public employee would be influenced thereby. Reference is made to these provisions of the law not to imply that there has been or will be any transgression thereof but merely to provide a complete response to the questions presented. Lastly, 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 L. Conclusion: As an A for Commonwealth Department B, you would be considered a "public employee" subject to the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq., and the Regulations of the State Ethics Commission, 51 Pa. Code § 11.1 et seq. Section 1103(a) of the Ethics Act would not prohibit you, in your private capacity, from performing [type of work] on privately funded projects under your own F or performing work for Cs (regardless of the project funding sources) subject to the condition that in your public position as an A for Commonwealth Department B, you would fully comply with Section 1103(a) of the Ethics Act. Section 1103(a) of the Ethics Act would prohibit you from using the authority of your public position, or confidential information received by being in your public position, in furtherance of such business activities. Upon termination of your employment with Commonwealth Department B, you would become a "former public employee" subject to Section 1103(g) of the Ethics Act. The former governmental body would be Commonwealth Department B in its entirety, including but not limited to Unit D. For the first year following termination of your employment with Commonwealth Department B, Section 1103(g) of the Ethics Act would apply and restrict “representation” of a “person” before Commonwealth Department B. The restrictions as to representation outlined above must be followed. 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 Confidential Advice, 12-573 November 13, 2012 Page 8 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