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HomeMy WebLinkAbout13-570 Confidential ADVICE OF COUNSEL October 28, 2013 13-570 This responds to your letter of September 3, 2013, 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 prohibitions or restrictions upon two As for [name of political subdivision] (“the Political Subdivision”), Pennsylvania, as to: (1) authorizing the expenditure of public funds to advocate and educate residents of the Political Subdivision with regard to proposed changes to the Political Subdivision’s current B; or (2) advocating during work hours with regard to proposed changes to the Political Subdivision’s current B. Facts: You have been authorized by Political Subdivision As Individual 1 and Individual 2, hereinafter collectively referred to as “the Two Political Subdivision As,” to request a confidential advisory from the Pennsylvania State Ethics Commission on their behalf. You have submitted facts that may be fairly summarized as follows. The Political Subdivision is governed by the [number]-Member Political Subdivision C pursuant to the D. You have submitted a copy of the D, which document is incorporated herein by reference. Pursuant to an E passed on [date], the F was established to consider and make recommendations as to whether the Political Subdivision’s current B should be changed. The F’s recommendations will be presented within [certain time frame] and will be subject to a subsequent E to determine whether such recommendations should be enacted. The F’s meetings and all of its other functions are funded by the Political Subdivision. [Number] of the [number] Members of the F are known as the G, and they are vocal proponents of eliminating the Political Subdivision’s current B and replacing it with H. [Number] of the F’s [number] Is are held by individuals affiliated with the G. You state that the J of the F recently [expressed a certain opinion as to the recommendations to be made by the F]. You state that the Political Subdivision C maintains that the Political Subdivision’s current B is less expensive and more efficient than the alternative proposals. You further state that the Political Subdivision C seeks to advocate for the Political Confidential Advice, 13-570 October 28, 2013 Page 2 Subdivision’s current B so that the residents of the Political Subdivision are fully informed. Based upon the above submitted facts, you pose the following questions: (1) Whether the Ethics Act would permit the Two Political Subdivision As to authorize the expenditure of public funds to advocate and educate the residents of the Political Subdivision with regard to the proposed changes to the Political Subdivision’s B; and (2) Whether the Ethics Act would permit the Two Political Subdivision As to publicly advocate during work hours with regard to the proposed changes to the Political Subdivision’s 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. The Two Political Subdivision As are public officials 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 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. Confidential Advice, 13-570 October 28, 2013 Page 3 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. "Immediate family." A parent, spouse, child, brother or sister. "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. Confidential Advice, 13-570 October 28, 2013 Page 4 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, 610 Pa. 516, 528, 22 A.3d 223, 231 (2011). Based upon Kistler, the existence of a violation of Section 1103(a) would depend upon the circumstances in a given case. Raphael, Opinion 13-003. A conflict of interest would not exist to the extent the “de minimis exclusion” and/or the “class/subclass exclusion” set forth within the Ethics Act’s definition of the term "conflict" or "conflict of interest," 65 Pa.C.S. § 1102, would be applicable. 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. In order for the class/subclass exclusion to apply, two criteria must be met: (1) the affected public official/public employee, immediate family member, or business with which the public official/public employee or immediate family member is associated must be a member of a class consisting of the general public or a true subclass consisting of more than one member; and (2) the public official/public employee, immediate family member, or business with which the public official/public employee or immediate family member is associated must be affected "to the same degree" (in no way differently) than the other members of the class/subclass. 65 Pa.C.S. § 1102; see, Kablack, Opinion 02-003; Rubenstein, Opinion 01-007. The first criterion of the exclusion is satisfied where the members of the proposed subclass are similarly situated as the result of relevant shared characteristics. The second criterion of the exclusion is satisfied where the individual/business in question and the other members of the class/subclass are reasonably affected to the same degree by the proposed action. Kablack, supra. In addition, Sections 1103(b) and 1103(c) of the Ethics Act, 65 Pa.C.S. §§ 1103(b), (c), 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 question presented. Having set forth the above principles, you are advised as follows. Pursuant to Section 1103(a) of the Ethics Act, each of the Two Political Subdivision As would have a conflict of interest pursuant to Section 1103(a) of the Ethics Act as to authorizing the expenditure of public funds to advocate and educate the residents of the Political Subdivision with regard to the proposed changes to the Political Subdivision’s B, or by publicly advocating during work hours with regard to the proposed changes to the Political Subdivision’s B, to the extent that: (1) the Political Subdivision A would be consciously aware of a private pecuniary benefit for himself, a member of his immediate family, or a business with which he or a member of his immediate family is associated; (2) the Political Subdivision A’s action(s) would constitute one or more specific steps to attain that benefit; and (3) neither the de minimis exclusion nor the class/subclass exclusion set forth within the Ethics Act’s definition of the term "conflict" or "conflict of interest," 65 Pa.C.S. § 1102, would be applicable. Confidential Advice, 13-570 October 28, 2013 Page 5 As noted above, in each instance of a conflict of interest, the Political Subdivision A(s) with the conflict 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 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 As for [name of political subdivision] (“the Political Subdivision”), Pennsylvania, Individual 1 and Individual 2 (hereinafter collectively referred to as “the Two Political Subdivision As”) are public officials 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 Political Subdivision is governed by the [number]- Member Political Subdivision C pursuant to the D; (2) pursuant to an E passed on [date], the F was established to consider and make recommendations as to whether the Political Subdivision’s current B should be changed; (3) the F’s recommendations will be presented within [certain time frame] and will be subject to a subsequent E to determine whether such recommendations should be enacted; (4) the F’s meetings and all of its other functions are funded by the Political Subdivision; (5) [number] of the [number] Members of the F are known as the G, and they are vocal proponents of eliminating the Political Subdivision’s current B and replacing it with H; (6) [number] of the F’s [number] Is are held by individuals affiliated with the G; (7) the J of the F recently [expressed a certain opinion as to the recommendations to be made by the F]; (8) the Political Subdivision C maintains that the Political Subdivision’s current B is less expensive and more efficient than the alternative proposals; and (9) the Political Subdivision C seeks to advocate for the Political Subdivision’s current B so that the residents of the Political Subdivision are fully informed, you are advised as follows. Pursuant to Section 1103(a) of the Ethics Act, each of the Two Political Subdivision As would have a conflict of interest pursuant to Section 1103(a) of the Ethics Act as to authorizing the expenditure of public funds to advocate and educate the residents of the Political Subdivision with regard to the proposed changes to the Political Subdivision’s B, or by publicly advocating during work hours with regard to the proposed changes to the Political Subdivision’s B, to the extent that: (1) the Political Subdivision A would be consciously aware of a private pecuniary benefit for himself, a member of his immediate family, or a business with which he or a member of his immediate family is associated; (2) the Political Subdivision A’s action(s) would constitute one or more specific steps to attain that benefit; and (3) neither the de minimis exclusion nor the class/subclass exclusion set forth within the Ethics Act’s definition of the term "conflict" or "conflict of interest," 65 Pa.C.S. § 1102, would be applicable. In each instance of a conflict of interest, the Political Subdivision A(s) with the conflict 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. 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. Confidential Advice, 13-570 October 28, 2013 Page 6 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