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HomeMy WebLinkAbout89-514 RockafellowLee D. Rockafellow, Esquire 318 W. Bridge Street Suite 1 Morrisville, PA 19067 Dear Mr. Rockafellow: STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108-1470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL March 14, 1989 89 -514 Re: Conflict of Interest, Mayoral Candidate, Member of Corporation, Corporate Development of Property within the Borough This responds to your letter of February 2, 1989, in which you requested advice from the State Ethics Commission. Issue: Whether the State Ethics Act presents any restrictions or prohibition upon a mayor, if elected, from being a primary member of a corporation that seeks to develop certain property located in the borough. Facts: After stating that you were the Mayor of Morrisville from 1981 through 1985, and that you were narrowly defeated in the last election, you indicate that you are considering running again for Mayor but have certain questions prior to making a decision as to whether you will run. You note that a group was formed 18 months ago and registered as Gateway Limited which is a corporation wherein you are a primary member. You state that the group presented a potential plan to the Borough Council regarding the development of certain unused land in the Borough consisting of between three and five acres which is at the far end of Williamson Park. After noting that the property in question has not been used for any purpose, you state that your group has proposed to build a mid rise building for housing the elderly as a life care type facility which has a proximity to the downtown area. You state that the first floor would consist of shops; the second and third floor would consist of offices which might include medical facilities; the fourth through ninth floor would consist of senior housing and the top of the building would be a restaurant overlooking the Delaware River and Trenton Skyline. Lee D. Rockafellow, Esquire March 14, 1989 Page 2 You advise that the proposal was presented approximately two months ago to the Borough Council which was interested in the matter. You state that the town people are positive towards the proposal and that you are now in the process of working up formalized plans for presentation. Additionally, you note that the Borough Solicitor is reviewing the matter regarding the appropriate way of acquiring the interest in land either through a 99 year lease or an outright sale. You then indicate that you do not anticipate that public funds or direct participation by the Borough would occur and that you do not anticipate that any tax rebates or reduction would be requested. However, you state that there is a possibility that low interest loans through the County Redevelopment Authority or other appropriate agency on the state, federal level would make the project more viable. You state that all discussions on this matter would be public and that if you were elected mayor, the project would be ongoing and all information would be public and that you would not participate directly in any discussions, public or private, at any time. You also state that anyone with any interest in the matter would be fully knowledgeable of your involvement. You then reference a - similar issue which arose some years ago when you served as mayor and had holdings with others in the downtown section which received redevelopment funding. You then note that it was then determined that you could not participate in direct discussions as to the ultimate decision and that you complied with those restrictions regarding a conflict or a potential conflict. You indicate that the same result appears to apply here and that additionally you as mayor do not vote, unless to break a tie, and that you would not vote in such situations if elected. You conclude by posing two questions under the Ethics Act: what limitations the Ethics Act would impose upon you in the event that you were elected and the project continues and secondly, what information should be made public in addition to the above in addition to the reporting requirements in the Statement of Financial Interests., Discussion: If you become a candidate for the office of mayor, Section 4(b) of the Ethics Act would require that you file a Statement of Financial Interests prior to the time that you would file a petition to appear on the ballot for election as a public official. 65 P.S. §404(b). If you are successful and elected mayor, you would become a public official subject to the provisions of the Ethics Act. 65 P.S. §402; 51 Pa. Code §1.1. Lee D. Rockafellow, Esquire March 14, 1989 Page 3 Section 3(a) of the Ethics Act provides: Section 3. Restricted Activities. (a) No public official or public employee shall use his public 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 term business with which he is associated is defined under the Ethics Act as follows: 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. 5402. Since you have stated that you are a primary member of Gateway Limited, it would appea -r- what - Gateway Limited is a business with which you are associated as that term is defined under the Ethics Act. Under Section 3(a) quoted above, the State Ethics Commission has determined that use of office by a public official to obtain a financial gain for himself or a member of his immediate family or a business with which he is associated which is not provided for in law transgresses the above provision of law. Thus, use of office by a public official to obtain a financial gain which is not authorized as part of his compensation is prohibited by Section 3(a): Hoak /McCutcheon, Orders No. 128, 129, affirmed McCutcheon v. State Ethics Commission, 77 Pa. Commw. Ct. 529, 466 A.2d 283 (1983); Yacobet, Order No. 412 -R, affirmed Yacobet v. State Ethics. Commission, 109 Pa. Commw. Ct. 432, 531 A.2d 536 (1987). Similarly, Section 3(a) of the Ethics Act would prohibit a public official /employee from using public office to advance his own interests; Koslow, Order 458 -R, affirmed Koslow v. State Ethics Commission, Pa. Commw. Ct. , 540 A.2d 1374 (1988). Likewise, a public official /employee may not use the status or position of public office for his own personal advantage; Huff, Opinion 84 -015. Lee D. Rockafellow, Esquire March 14, 1989 Page 4 Section 3(b) of the Ethics Act provides: (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 contribution, reward, or promise of future employment based on any understanding that the vote, official action, or judgment of the public employee or candidate for public office would be influenced thereby. 65 P.S. 403(b). Under Section 3(b) of the Ethics Act cited above, which a public official or employee must observe, a public official or employee must neither offer nor accept anything of value on the understanding or with the intention that his judgment would be influenced thereby. It is assumed such a situation does not exist here. This Section is referenced not to indicate that any such activity has been or will be undertaken but in an effort to provide a complete response to your inquiry. Section 3. Restricted activities. (d) Other areas of possible conflict shall be addressed by the commission pursuant to paragraph (9) of Section 7. 65 P.S. 403(d). Under the above provision of law, the Ethics Commission, however, is also empowered to address other areas of possible conflict pursuant to Section 3(d). 65 P.S. §403(d). Fritzinaer, Opinion 80 -008; DeBenedictis, Opinion 86 -002. The parameters of the type of activity encompassed by this provision are generally reviewed in light of the preamble to the Ethics Act which enunciates the legislative intent of the Act. The intent and purpose of the Act is to strengthen the faith and confidence of the people in their government by assuring the public that the financial interests of the holders of public office present neither a conflict nor the appearance or a conflict with the public trust. A public official or employee, pursuant to this provision, is to ensure that their personal financial interests present neither a conflict nor the appearance of a conflict with the public trust. 65 P.S. S401. Such a conflict may exist where an individual represents one or more adverse interests. Lee D. Rockafellow, Esquire March 14, 1989 Page 5 Alfano, Opinion 80 -007; where an individual serves in positions that are incompatible or conflicting; Nelson, Opinion 85 -009, or where such an official or employee accepts compensation to which he is not entitled. Domalakes, Opinion supra. Applying the above provisions of law to the instant matter, the Ethics Act would not per se preclude you as a public official from having an outside business interest. Goodman, Opinion 88- 001. However, you may not under the Ethics Act use public office or confidential information as a means in whole or part to obtain or advance the interests of a business with which you are associated. In this regard, you have noted that you would not exercise you prerogative of voting to break a tie in matters concerning this particular development project. Additionally, you could not use public office or employees or equipment or telephones or postage relative to carrying on your private business interests. Dorrance, Order 456; Cohen, Order 610 -R. Further, in your position as mayor, you could not, even though you do not vote, participate in any discussions or review regarding the development project as to which the business with which you are associated is seeking to develop. You would also have to publicly note your abstention in these matters as well as the reason for your abstention. Lastly, 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 in this advice is the applicability of the Borough Code or any restrictions imposed by HUD upon public officials regarding funds for redevelopment projects. Conclusion: As a candidate for the mayor of Morrisville, you would be required under the Ethics Act to file a Statement of Financial prior to your name appearing upon the ballot. If elected, you as a mayor of Morrisville, would be a public official subject to the provisions of the State Ethics Act. Although the Ethics Act does not preclude you from having an outside business interests with a development corporation, Sections 3(a) and 3(d) of the Ethics Act would restrict you from using public office or confidential information to advance the interests of a business with which you are associated as noted above. You could not participate or vote to break a tie in any matter involving the business with which you are associated and you must note your abstention of public record together with the reason for the abstention. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Lee D. Rockafellow, Esquire March 14, 1989 Page 6 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 52.12. S'ncerely, Vincent J. Dopko, General Counsel