HomeMy WebLinkAbout14-546 Confidential
ADVICE OF COUNSEL
October 6, 2014
14-546
This responds to your letter dated August 12, 2014, 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 a Member of the
General Assembly with regard to receiving payment for serving as the A of a B C D.
Facts:
You have been authorized by a Member of the General Assembly (“the
State Legislator”) to request a confidential advisory from the Pennsylvania State Ethics
Commission on his behalf. You have submitted facts, the material portion of which may be
fairly summarized as follows.
An E (“the Entity”), which describes itself as a \[type of entity\], has Fs in a G
represented in part by the State Legislator. The Entity’s H in the relevant I includes a B C
D. The D covers a wide-range of \[certain types of events and issues\], and the D’s topics
might include J issues affecting the Ks.
For approximately ten years prior to \[month, year\], an L was the A of the D, and
during that time period, the State Legislator made numerous appearances as an M of the
D. Shortly after the \[occurrence of a particular event\] in \[month, year\], representatives of
the Entity approached the State Legislator and offered him a position of “at-will”
employment as N serving as the A of the D. The Entity offered to compensate the State
Legislator at a rate of \[amount\] per hour less applicable deductions, with the option to
enroll in the Entity’s retirement savings plan. You state that the rate of compensation
offered to the State Legislator by the Entity is likely below the compensation paid to other
employees classified by the Entity as N. The State Legislator became an employee of the
Entity in \[month, year\], and he completed relevant tax forms to withhold federal and state
taxes from compensation due him and declined to participate in the Entity’s retirement
savings plan.
Since \[month, year\], the State Legislator has served as the A of the D. You state
that the D has covered a broad range of \[types of issues\] unrelated to the State
Legislator’s legislative role, although issues relating to J might arise and be discussed, and
that topics discussed while the State Legislator has been the A of the D have included
\[particular topics\]. The State Legislator dedicates approximately three hours per week to
prepare for and serve as the A of the D, and he does not use confidential information
received through his legislative role or legislative resources such as personnel, equipment,
Confidential Advice, 14-546
October 6, 2014
Page 2
supplies, facilities, and the like in connection with his role as the A of the D.
As of the date you submitted your advisory request, the State Legislator had not
received any payments or compensation for serving as the A of the D and specifically had
not received any direct or indirect income from the Entity or any of its Os.
Based upon the above submitted facts, you ask whether the Ethics Act would
impose any prohibitions or restrictions upon the State Legislator with regard to receiving
payment or compensation from the Entity for serving as the A of the D from \[month, year\] to
date and in the future.
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. 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.
The State Legislator is a public official subject to the provisions of the Ethics Act.
Section 1103(a) of the Ethics Act provides:
§ 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:
§ 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 whichhe
or a member of his immediate family is associated.
Confidential Advice, 14-546
October 6, 2014
Page 3
"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.
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, subject to the statutory
exclusions to the Ethics Act’s definition of the term “conflict” or “conflict of interest, 65
Pa.C.S. § 1102, 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. To the extent the activities of a state legislator would relate to “legislative
actions” (introducing, considering, debating, voting, enacting, adopting, or approving
legislation), they would be constitutionally controlled and exempt from the purview of the
Ethics Act and the State Ethics Commission. See, Corrigan, Opinion 87-001.
Section 1103(d) of the Ethics Act provides as follows:
§ 1103. Restricted activities.
(d) Honorarium.--
No public official or public employee
shall accept an honorarium.
65 Pa.C.S. § 1103(d).
The Ethics Act defines the term “honorarium” as follows:
§ 1102. Definitions
"Honorarium."
Payment made in recognition of
published works, appearances, speeches and presentations
and which is not intended as consideration for the value of
such services which are nonpublic occupational or
professional in nature. The term does not include tokens
presented or provided which are of de minimis economic
impact.
65 Pa.C.S. § 1102.
Section 1103(d) of the Ethics Act is an absolute prohibition against accepting
honoraria. The question of whether a given payment is an honorarium prohibited by
Section 1103(d) is determined by an application of the statutory definition set forth in the
Ethics Act, not by the mere label that may have been attached to the payment. Fiorello,
Order No. 1363; Confidential Opinion, 01-001.
The statutory definition of "honorarium" generally includes payments that are made
in recognition of speaking engagements/presentations, appearances, and published
works, but excludes such payments if: (1) they are legitimately intended as consideration
for the value of such services; and (2) they are undertaken in the public official's/public
employee's private professional or occupational capacity and are not related to the public
position. Fiorello, supra; Confidential Opinion, 01-001.
Having established the above general principles, you are advised as follows.
Confidential Advice, 14-546
October 6, 2014
Page 4
Based upon the totality of the submitted facts, the Ethics Act would not preclude the
State Legislator from receiving the aforesaid payment/compensation for serving as the A of
the D if the D has not covered/would not cover topics related to the State Legislator’s
public position. Cf., Fiorello, supra; Confidential Opinion, 13-005-R.
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 Member of the General Assembly, the individual who is the
subject of this advisory (“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) an E (“the Entity”), which describes itself as a
\[type of entity\], has Fs in a G represented in part by the State Legislator; (2) the Entity’s H
in the relevant I includes a B C D; (3) the D covers a wide-range of \[certain types of events
and issues\], and the D’s topics might include J issues affecting the Ks; (4) for
approximately ten years prior to \[month, year\], an L was the A of the D, and during that
time period, the State Legislator made numerous appearances as an M of the D; (5) shortly
after the \[occurrence of a particular event\] in \[month, year\], representatives of the Entity
approached the State Legislator and offered him a position of “at-will” employment as N
serving as the A of the D; (6) the Entity offered to compensate the State Legislator at a rate
of \[amount\] per hour less applicable deductions, with the option to enroll in the Entity’s
retirement savings plan; (7) the rate of compensation offered to the State Legislator by the
Entity is likely below the compensation paid to other employees classified by the Entity as
N; (8) the State Legislator became an employee of the Entity in \[month, year\], and he
completed relevant tax forms to withhold federal and state taxes from compensation due
him and declined to participate in the Entity’s retirement savings plan; (9) since \[month,
year\], the State Legislator has served as the A of the D; (10) the D has covered a broad
range of \[types of issues\] unrelated to the State Legislator’s legislative role, although
issues relating to J might arise and be discussed, and topics discussed while the State
Legislator has been the A of the D have included \[particular topics\]; (11) the State
Legislator dedicates approximately three hours per week to prepare for and serve as the A
of the D, and he does not use confidential information received through his legislative role
or legislative resources such as personnel, equipment, supplies, facilities, and the like in
connection with his role as the A of the D; and (12) as of the date you submitted your
advisory request, the State Legislator had not received any payments or compensation for
serving as the A of the D and specifically had not received any direct or indirect income
from the Entity or any of its Os, you are advised as follows.
Based upon the totality of the submitted facts, the Ethics Act would not preclude the
State Legislator from receiving the aforesaid payment/compensation for serving as the A of
the D if the D has not covered/would not cover topics related to the State Legislator’s
public position. 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
Confidential Advice, 14-546
October 6, 2014
Page 5
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