HomeMy WebLinkAbout85-573 DenlingerMaihng Address.
State Ethics Commission
308 Finance Building
P. 0. Box 11470
Harrisburg, Pa. 17108-1470
August 15, 1985
ADVICE OF COUNSEL
Ms. Trudi Q. Denlinger
P.O. Box 7
Pocono Pines, PA 18250
Re: Township Supervisor, Voting, Real Estate Development, Conflict of
Interest
85 - 573
Dear Ms. Denlinger:
This responds to your letter of July 24, 1985, wherein you requested the
advice of the State Ethics Commission.
Issues: A. Whether you, as a township supervisor, may vote on a proposed
real estate development submitted by a developer that you have employed in the
renovation of a building you own.
B. Whether you, as a township supervisor, may vote on a proposed real
estate development when you are a real estate broker in the community.
Facts: You currently serve as a Supervisor for Tobyhanna Township, Monroe
County, Pennsylvania. You are also a real estate agent and are currently
employed as a rental manager with C -R Baxter Real Estate Inc. In this
capacity, you manage approximately 300 vacation homes in the Pocono area.
Your company has marketing agreements with various realty and community
developments. You indicate, however, that excluded from such_marketing
agreements is Pine Crest Resort owned and operated by E.P. Carroll
Construction LTD.
E.P. Carroll has recently presented a 158 unit development plan to the
township for review and consideration. You indicate that you do not deal in
the units owned and operated by Carroll. In the event that a sales person at
your office or you have a client who wants to purchase a Carroll owned unit,
that client is referred to an agent who deals in these units. As a result of
such referral, it is possible that the referring agent will receive a
percentage of the sales commission. While you have made such referrals, you
to date have not received any such commission in relation to units owned by
the Carroll Company.
State Ethics Commission • 308 Finance Building • Harrisburg, Pennsylvania
Ms. Trudi Denlinger
August 15, 1985
Page 2
In addition to the foregoing, you have recently employed Carroll
Construction in the renovation of a building that you and your husband own.
The foreman on this job informed you that there was a discount in connection
with this project. Such a reduction, as you note, could be considered a gift.
As such, you have requested a full bill for the services rendered and in your
letter you indicated that the final payment on this project will be made by
July 25, 1985. At the time of this project, the Carroll Company has not
presented any development plans to the township.
You indicate that both of the foregoing situations have been raised as
potential conflicts and you, therefore, seek the advice of the Commission in
relation thereto.
Discussion: As an elected township supervisor, you are a puhlic official as
that term is defined in the State Ethics Act. 65 P.S. §402. As such, your
conduct must conform to the requirements thereof. Sowers, 80 -050.
Generally, the Ethics Act provides that:
Section 3. Restricted activities.
(a) No public official or public employee shall use his
puhlic office or any confidential information received
through his holding public office to obtain financial gain
other than compensation provided by law for himself, a
member of his immediate family, or a business with which
he is associated. 65 P.S. 403(a).
The Act further provides:
Section 2. Definitions.
"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 holder
of stock. 65 P.S. 402. -
Thus, if you stand in the above - referenced relationships as a real estate
manager, owner, or holder of interests, this would constitute a "business with
which you were associated" under this definition. As a public official, you
would have to abstain from all participation, including discussions or votes,
in matters involving a business with which you are associated. The reasons
for your abstention must be disclosed and made part of the public record.
See, Eckstine, 83 -575.
Ms. Trudi Denlinger
August 15, 1985
Page 3
A review of the facts as set forth in your request letter do not indicate
that such a relationship exists. You have no association with the Carroll
Company and you do not manage or otherwise deal in Carroll owned property.
You have not and will not receive any financial benefit, either direct or
indirect, from the Carroll Company. We also note that in the past the
Commission has applied Section 3(a), not only in situations where an official
votes in favor of a proposal, but where such official may vote against such
proposal. That is, where such an interest exists, all participation would be
prohibited.
This is so because in voting against the plans of developers, a problem
may arise if, by the officials vote to deny or disapprove such development,
the official inevitably favors his or her own personal interests. Such a
circumstance would arise for example, where limited development possibilities
exist or where only limited development is permitted and where by denying
another developer the opportunity to operate, the official may effectively
enhance the possibility that the official's development interests may be
allowed to operate. See Coploff, 83 -005 and Reisinger, No. 146 -C. We note
that from the facts as set forth, you have no actual interest in this matter
as neither you nor any person or company with which you are associated is
submitting a development proposal to the township. If, however, you or the
business with which you are associated will be benifitted in any way by either
the approval or disapproval of this proposal, the result may be different. We
note that you are intending to resign from your real estate position. Thus,
if you are not involved in real estate business at all, there appears to be no
potential benefit to you or the business with which you are associated.
In addition to the foregoing sections of the Ethics Act, we note that the
intent of the law is to insure that the financial interests of the public
official are not in conflict with the public trust. As such public officials
must avoid even the appearance of a conflict. 65 P.S. §401.
In relation to the work which the Carroll Company completed on your
private building, there is no doubt that if you have or were to receive a
discount in relation to that project and if you were to vote on a Carroll
Company proposal, there would be the appearance of a conflict of interest.
Additionally the Ethics Act provides that:
Section 3. Restricted activities.
(b) No person shall offer or give to a public official or
public employee or candidate for public office or a member
of his immediate family or a business with which he is
associated, and no public official or public employee or
candidate for public office shall solicit or accept,
anything of value, including a gift, loan, political
Ms. Trudi Denlinger
August 15, 1985
Page 4
Such a discount could concievably be viewed as a violation of this provision
of the law.
You indicate, however, that no such discount was accepted and that you
have paid the full costs of the renovation project.
The fact that the Carroll Company performed work for you would not by
itself result in the type of conflict of interest that would require your
abstention. If, of course, there were other factors present in this
situation, such as a dispute between you and the company, a different result
may be required.
Conclusion: Based upon the foregoing, there would be no prohibition upon your
participation as a public official, in the townships consideration of the
currently pending development plans.
Pursuant to Section 7(9)(ii), this 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, providing the requestor 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 request that the full Commission review this Advice. A
personal appearance before the Commission will be scheduled and a formal
Opinion from the Commission will be issued. Any such appeal must be made, in
writing, to the Commission within 15 days of service of this Advice pursuant
to 51 Pa. Code 2.12.
JJC /sfb
contribution, reward, or promise of future employment
based on any understanding that the vote, official action,
or judgment of the public official or public employee or
candidate for public office would be influenced thereby.
65 P.S. 403(b).
Sincer
nt i no
Gene Counsel