HomeMy WebLinkAbout17-003 ConfidentialSTATE ETHICS COMMISSION
309 FINANCE BUILDING
HARRISBURG, PENNSYLVANIA 17120
OPINION OF THE COMMISSION
Before: Nicholas A. Colafella, Chair
Mark R. Corrigan, Vice Chair
Roger Nick
Maria Feeleyy
Melanie DePalma
DATE DECIDED: 2115/17
DATE MAILED: 2117117
17 -003
To the Requester:
This Opinion is issued in response to your letter dated .January 26, 2017, by which
you requested a confidential advisory from this Commission.
I. ISSUE:
Whether the Public Official and Employee Ethics Act ( "Ethics Act " }, 65 Pa.C.S. §
110'1 et seg., would impose prohibitions or restrictions upon an A and B of Governmental
Body T�, who in a private capacity is the D of an E F and G firm, with regard to participating
in discussions or votes by Governmental Body C on matters unrelated to E that the
following entities may have before Governmental Body C: (1) a firm client for which the firm
receives either an ongoing or only an up -front I related to the client's E J(s); (2) a party
that is not a firm client bul intends to use an aforesaid firm client as a consultant and/or
subcontractor; or (3) a party that is not a firm client but is a client of an E company for
which the firm is a K
II. FACTUAL BASIS FOR DETERMINATION:
As [title] of Governmental Body C, you have been authorized by Individual L, who is
an A and B of Governmental Body C, to request a confidential advisory from this
Commission on his behalf. You have submitted facts that may be fairly summarized as
follows.
In a private capacity, Individual L is the D of an E F and G firm named [name of firm]
( "the Firm "). The Firm may receive an ongoing H related to the E J(s) of a Firm client,
hereinafter referred to as an "Ongoing H Firm Client." The Firm may also receive only an
up -front 1 and no ongoing H related to the E J(s) of a Firm client, hereinafter referred to as
a "No H Firm Client.'
You ask whether the Ethics Act would require Individual L to abstain from
discussions or ublic votes by Governmental Body C on matter(s) unrelated to E that the
following entity(ies) may have before Governmental Body C:
(1) An Ongoing H Firm Client;
P.O. BOX 1 1470, HARRISBURG, PA 17 1 08- 1470 • 717 -783 -1 6 10 • 1-800-932-0936 • www.ethics.state.pa.us
Confidential Opinion, 17 -003
e nuary ,
Page 2
(2) A No H Firm Client;
(3) A party that is not a Firm client but intends to use an Ongoing H Firm Client
or a No H Firm Client as a consultant and/or subcontractor; or
(4) A party that is not a Firm client but is a client of an E company for which the
Firm is a K.
By letter dated February 3, 2017, you were notified of the date, time and location of
the executive meeting at which your request would be considered.
At the executive meeting on February 15, 2017, you appeared together with [name
of attorney], who serves as [type of relationship] to Governmental Body C, to answer any
questions of the Members of this Commission. [Name of attorney] noted that public
officials are often confronted with the types of issues raised by your advisory request.
Individual L is requesting this advisory so that when the aforesaid scenarios arise, he will
know whether he needs to recuse himself in order to comply with the Ethics Act.
Ill. 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, this 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 truthfullly disclosed all of the material facts.
As an A and B of Governmental Body C, Individual L is a public official subjectto the
provisions of the Ethics Act.
Sections 1103(a) and 11030) 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
Confidential Opinion, 17-003
February 17,
Page 3
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), Q).
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.
"Business." An 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 enga ed in business for profit which comprises more
than 5% of he equity of the business or more than 5% of the
assets of the economic interest in indebtedness.
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. .5 1102, a public officiallpublic employee is prohibited
from using the authority of public office /employment or confidential information received by
holding such a public position for the private ecuniary benefit of the public official/public
employee himself, an member of his immediate family, or a business with which he or a
member of his immediate family is associated.
Confidential O inion, 17 -003
February 11, 2U1 I
Page 4
In each instance of a conflict of interest, the public officiallpublic employee would be
required to abstain 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 lobbying for a particular result. Juliante, Order
809 u ect to certain statutory exceptions, in each instance of a voting conf ict, Section
11030) of the Ethics Act would require the public official/public employee to abstain and to
publicly disclose the abstention and reasons for same, both orally and by filing a written
memorandum to that effect with the person recording the minutes.
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 Secfion 1 TOT(aTo—Fthe
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 1public 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." Id., 610 Pa. at 528, 22 A.3d at 231.
Having established the above general principles, you are advised as follows.
The Firm is a business with which Individual L is associated in his capacity as the D.
Individual L would have a conflict of interest under Section 1103(a) of the Ethics Act as to
discussion(s) and/or vote(s) of Governmental Body C on matter(s) unrelated to E that an
entity- -such as an Ongoing H Firm Client, a No H Firm Client, a party that is not a Firm
client but intends to use an Ongoing H Firm Client or a No H Firm Client as a consultant
and /or subcontractor, or a party that is not a Firm client but is a client of an E company for
which the Firm is a K- -would have before Governmental Body C if: (1 ) he would be
consciously aware of a private pecuniary benefit for himself or the Firm; (2) his 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.
As noted above, in each instance of a conflict of interest, Individual L would be
required to abstain from all forms of participation, which would include voting unless one of
the statutory exceptions of Section 1103 ') of the Ethics Act would be applicable.
Additionally, the disclosure requirements of Section 11030) 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.
IV. CONCLUSION:
As an A and B of Governmental Body C, Individual L 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 uppon the submitted facts that: (1 in a private capacity, Individual L is the D
an E F and G firm named [name of firm] `the Firm "); (2) the Firm may receive an
ongoing H related to the E J(s) of a Firm client, hereinafter referred to as an "Ongoing H
Confidential O inion, 17 -003
February 17, 2011
Page 5
Firm Client "; and (3) the Firm may also receive only an up -front I and no on oingg H related
to the E J(s) of a Firm client, hereinafter referred to as a "No H Firm Clienf," you are
advised as follows.
The Firm is a business with which Individual L is associated in his capacity as the D.
Individual L would have a conflict of interest under Section 11 03 a of the Ethics Act as to
discussion(s) and/or vote(s) of Governmental Body C on matter(s) unrelated to E that an
entity - -such as an Ongoing H Firm Client, a No H Firm Client, a party that is not a Firm
client but intends to use an Ongoing H Firm Client or a No H Firm Client as a consultant
and /or subcontractor, or a party that is not a Firm client but is a client of an E company for
which the Firm is a K- -would have before Governmental Body C if: (1) he would be
consciously aware of a private pecuniary benefit for himself or the Firm; (2) his 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, Individual L would be required to
a stain from all forms of participation, which would include voting unless one of the
statutory exceptions of Section 11030} of the Ethics Act would be applicable. Additionally,
the disclosure requirements of Section 11030? 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
URI
Pursuant to Section 1107(10 ) of the Ethics Act, the person who acts in good faith on
this Opinion issued to him shall not be subject to criminal or civil penalties for so acting
provided the material facts are as stated in the request.
This letter is a public record and will be made available as such.
By the Commission,
4
Ni�lioA. Colafella
Chair