HomeMy WebLinkAbout15-518 Clarke
ADVICE OF COUNSEL
March 13, 2015
Kevin Clarke
1510 Quincy Avenue
Dunmore, PA 18509
15-518
Dear Mr. Clarke:
This responds to your letter dated February 9, 2015, by which you requested an
advisory from the Pennsylvania State Ethics Commission (“Commission”).
Issue:
Whether, pursuant to Section 1103(a) of the Public Official and Employee
Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1103(a), an individual who retired from
employment with a school district and would be subsequently elected as a school
director in the school district would have a conflict of interest with regard to school
district employee and health insurance contracts or other matters before the school
district school board, where the individual receives from the school district health
insurance benefits for himself and his wife as part of his retirement package.
Facts:
You request an advisory from the Commission based upon submitted
facts that may be fairly summarized as follows.
In July 2010, you retired from employment with the Dunmore School District
(“School District”). When you retired, you received via contract a retirement package
that included annual severance payments and School District-paid health insurance
benefits for your family. The annual severance payments ended with a final payment in
July 2014. You state that the health insurance benefits will continue for you and your
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wife until your 65 birthday in May 2016 and that they cannot be extended. You further
state that according to your separation agreement, the health insurance benefits you
and your wife receive cannot change.
You are considering seeking election as a School Director for the School District
for a four-year term beginning in December 2015.
Based upon the above submitted facts, you pose the following questions:
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March 13, 2015
Page 2
(1) Whether, if you would be elected as a School Director for the School
District, you would have a conflict of interest with regard to voting on
School District employee and health insurance contracts; and
(2) Whether you would have a conflict of interest in any matter before the
School District School Board as a result of your previous service to the
School District.
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.
If you would be elected as a School Director for the School District, upon
assuming said position, you would in that capacity be 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:
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March 13, 2015
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§ 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.
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.
Per the Pennsylvania Supreme Court’s decision in Kistler v. State Ethics
Commission, 610 Pa. 516, 22 A.3d 223 (2011), in order to violate Section 1103(a) of the
Ethics Act, a public official/public employee:
… must act in such a way as to put his \[office/public position\]
to the purpose of obtaining for himself a private pecuniary
benefit. Such directed action implies awareness on the part
of the \[public official/public employee\] of the potential
pecuniary benefit as well as the motivation to obtain that
benefit for himself.
Kistler, supra, 610 Pa. at 523, 22 A.3d at 227. To violate Section 1103(a) of the Ethics
Act, a public official/public employee “must be consciously aware of a private pecuniary
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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.” Id., 610 Pa. at 528, 22 A.3d at 231.
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.
Additionally, the Commission has determined that the approval of pre-fixed,
routine, uncontested bills/obligations does not in and of itself rise to the level of a
violation of Section 1103(a) of the Ethics Act. See, Yezzi, Order 825 at 58; Krushinski,
Order 168; Brooks, Opinion 89-023; Maholick, Opinion 90-010; Pizonka/Rieder, Opinion
09-007.
In applying the above provisions of the Ethics Act to your advisory request, you
are advised as follows.
Your wife is a member of your immediate family as that term is defined in the
Ethics Act. Upon taking office as a School Director for the School District, you generally
would have a conflict of interest pursuant to Section 1103(a) of the Ethics Act in matters
before the School District School Board that would financially impact you, a member of
your immediate family such as your wife, or a business with which you or a member of
your immediate family is associated unless the de minimis exclusion or the
class/subclass exclusion would be applicable. In each instance of a conflict of interest,
you 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.
In response to your first question you are advised that based upon the submitted
facts, you would not have a conflict of interest with regard to voting on School District
employee and health insurance contracts because the health insurance benefits that
you and your wife receive are pre-fixed by your separation agreement with the School
District and cannot change.
Your second question is general and has been addressed above to the extent
that it can be addressed.
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March 13, 2015
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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 Public School Code.
Conclusion:
Based upon the submitted facts that: (1) in July 2010, you retired
from employment with the Dunmore School District (“School District”); (2) when you
retired, you received via contract a retirement package that included annual severance
payments and School District-paid health insurance benefits for your family; (3) the
annual severance payments ended with a final payment in July 2014; (4) the health
th
insurance benefits will continue for you and your wife until your 65 birthday in May
2016, and they cannot be extended; (5) according to your separation agreement with
the School District, the health insurance benefits you and your wife receive cannot
change; and (6) you are considering seeking election as a School Director for the
School District for a four-year term beginning in December 2015, you are advised as
follows.
If you would be elected as a School Director for the School District, upon
assuming said position, you would in that capacity be a public official subject to the
provisions of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. §
1101 et seq. Your wife is a member of your immediate family as that term is defined in
the Ethics Act. Upon taking office as a School Director for the School District, you
generally would have a conflict of interest pursuant to Section 1103(a) of the Ethics Act
in matters before the School District School Board that would financially impact you, a
member of your immediate family such as your wife, or a business with which you or a
member of your immediate family is associated unless the de minimis exclusion or the
class/subclass exclusion contained 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, you 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. You would not
have a conflict of interest with regard to voting on School District employee and health
insurance contracts because the health insurance benefits that you and your wife
receive are pre-fixed by your separation agreement with the School District and cannot
change. 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
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March 13, 2015
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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