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HomeMy WebLinkAbout15-510 Brazil ADVICE OF COUNSEL February 27, 2015 John J. Brazil, Jr., Esquire 310 Adams Avenue, Suite 200 Scranton, PA 18503 15-510 Dear Mr. Brazil: This responds to your letters dated December 1, 2014, and January 17, 2015, 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 prohibitions or restrictions upon a borough council member with regard to purchasing a surplus generator from the borough. Facts: As Solicitor for the Borough of Moosic (“Borough”), you have been authorized by Borough Council Member Eugene Prusinski (“Mr. Prusinski”) to request an advisory from the Pennsylvania State Ethics Commission on his behalf. You have submitted facts that may be fairly summarized as follows. On or about July 24, 2014, Borough Council advertised in a local newspaper of general circulation for the sale of certain surplus Borough property, including a generator. The newspaper advertisement provided that the Borough would accept sealed bids for the property listed until 4:00 p.m. on August 12, 2014, and that bids would be opened at a public meeting at 7:00 p.m. on August 12, 2014. The Borough did not receive any bids for the generator. You state that the Borough does not wish to re-advertise the generator for sale as the cost of doing so would exceed the value of the generator. On November 11, 2014, Mr. Prusinski sent a letter to Borough Council indicating that he was interested in purchasing the generator from the Borough for $150.00. Based upon the above submitted facts, you ask whether Mr. Prusinski would be permitted to purchase the generator from the Borough for the amount offered provided that: (1) Mr. Prusinski’s offer would be made public; (2) the sale of the generator would be awarded at a public meeting; (3) Mr. Prusinski would abstain from the vote on the sale of the generator and give his reason for doing so; (4) Mr. Prusinski would not participate in any manner as to whether Borough Council would be willing to sell the generator to him; and (5) the Borough would receive documentation from the Borough Brazil, 15-510 February 27, 2015 Page 2 Road Commissioner that the generator is valued at less than $1,000.00 and that the amount offered by Mr. Prusinski represents the fair value of the item. Discussion: 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 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. To the extent that your inquiry relates to conduct that has already occurred, such past conduct may not be addressed in the context of an advisory opinion. However, to the extent your inquiry relates to future conduct, your inquiry may and shall be addressed. As a Borough Council Member, Mr. Prusinski is a public official 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. 65 Pa.C.S. §§ 1103(a), (j). The following terms related to Section 1103(a) are defined in the Ethics Act as follows: Brazil, 15-510 February 27, 2015 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. 65 Pa.C.S. § 1102. Subject to the statutory exclusions to the Ethics Act’s definition of the term “conflict” or “conflict of interest,” 65 Pa.C.S. § 1102, 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. One of the exclusions to the statutory definition of "conflict" or "conflict of interest," referred to herein as 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. The Commission has determined the applicability of the de minimis exclusion on a case-by-case basis, considering all relevant circumstances. In the past, the Commission has found amounts up to approximately $1,200 to be de minimis. 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 Brazil, 15-510 February 27, 2015 Page 4 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 as follows: § 1102. Definitions "Contract." An agreement or arrangement for the acquisition, use or disposal by the Commonwealth or a political subdivision of consulting or other services or of supplies, materials, equipment, land or other personal or real property. The term shall not mean an agreement or arrangement between the State or political subdivision as one party and a public official or public employee as the other party, concerning his expense, reimbursement, salary, wage, retirement or other benefit, tenure or other matters in consideration of his current public employment with the Commonwealth or a political subdivision. 65 Pa.C.S. § 1102. 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. Having established the above general principles, you are advised as follows. An agreement or arrangement whereby Mr. Prusinski would purchase the generator from the Borough would constitute a “contract” as that term is defined in the Ethics Act. Cf., Geary, Advice 06-610. As long as the restrictions and requirements of the Ethics Act would be observed, the Ethics Act would not prohibit Mr. Prusinski—in his private capacity—from purchasing surplus property from the Borough. You are advised that where the offered purchase price of $150.00 for the generator would be the fair market value of the generator, Mr. Prusinski would not have Brazil, 15-510 February 27, 2015 Page 5 a conflict of interest under Section 1103(a) of the Ethics Act in matters before Borough Council pertaining to his offer to purchase the generator, and the requirements of Section 1103(f) of the Ethics Act would not have to be observed as to a contract between Mr. Prusinski and the Borough for the sale of the generator, due to the amount involved. 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 Borough Code. Conclusion: As a Member of Council for the Borough of Moosic (“Borough”), Eugene Prusinski (“Mr. Prusinski”) 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) on or about July 24, 2014, Borough Council advertised in a local newspaper of general circulation for the sale of certain surplus Borough property, including a generator; (2) the newspaper advertisement provided that the Borough would accept sealed bids for the property listed until 4:00 p.m. on August 12, 2014, and that bids would be opened at a public meeting at 7:00 p.m. on August 12, 2014; (3) the Borough did not receive any bids for the generator; (4) the Borough does not wish to re-advertise the generator for sale as the cost of doing so would exceed the value of the generator; and (5) on November 11, 2014, Mr. Prusinski sent a letter to Borough Council indicating that he was interested in purchasing the generator from the Borough for $150.00, you are advised as follows. An agreement or arrangement whereby Mr. Prusinski would purchase the generator from the Borough would constitute a “contract” as that term is defined in the Ethics Act. As long as the restrictions and requirements of the Ethics Act would be observed, the Ethics Act would not prohibit Mr. Prusinski—in his private capacity—from purchasing surplus property from the Borough. You are advised that where the offered purchase price of $150.00 for the generator would be the fair market value of the generator, Mr. Prusinski would not have a conflict of interest under Section 1103(a) of the Ethics Act in matters before Borough Council pertaining to his offer to purchase the generator, and the requirements of Section 1103(f) of the Ethics Act would not have to be observed as to a contract between Mr. Prusinski and the Borough for the sale of the generator, due to the amount involved. 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 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 Brazil, 15-510 February 27, 2015 Page 6 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