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HomeMy WebLinkAbout89-535 BlairMs. Margaret A. Blair 1521 Westview Drive New Kensington, PA 15068 STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL April 27, 1989 89 -535 Re: Grant Program, Participation by Public Official /Employee Dear Ms. Blair: This responds to your letter of March 23, 1989, in which you requested advice from the State Ethics Commission. Issue: You ask, whether you, in your position as Administrative Assistant of the New Kensington Redevelopment Authority may participate in a grant program, hereinafter the Program, administered by the New Kensington Redevelopment Authority, hereinafter the Authority. Facts: After supplying your residence and telephone number, you indicate that you are currently employed as an Administrative Assistant with the Authority wherein you have worked since October 13, 1969. You state that there are only two employees with the Authority, yourself and the Executive Director, Mr. Thomas C. Haser. You state that the scope of your duties vary from typist, file clerk, rehabilitation financial specialist to other duties as are required. You advise that you desire a rehabilitation loan and that the City of New Kensington operates via the Redevelopment Authority City -Wide Low Interest Residential Rehabilitation Loan Program since 1986. In this regard, you note that there are no grants but just 3% loans and that qualification is based upon low /moderate income in accordance with Section 8 income guidelines and also as an owner occupant. You state that you qualify in both respects and that the availability of the loan program was made public by advertising in a daily newspaper and in a Sunday edition on 7 consecutive days. In addition, you note that the applicants were and continue to be taken on a first come first serve basis. You then elaborate upon the loan process wherein applications are received and compiled with all necessary financial and related data prepared by the Executive Director. You advise that the Executive Director does the inspection work, write -up, bid process and finally the presentation of recommendations to the authority board for review and approval or disapproval. You only perform prepatory work on the applications and have no input on the decision - making process; there is no preferential treatment to you as an employee Ms. Margaret A. Blair April 27, 1989 Page 2 because 59 loans have already been processed and approved and you do qualify in accordance with the guidelines. You finally note that the final approval or disapproval rests with the redevelopment authority board of directors. Discussion: Initially, we should note that under the Ethics Act our jurisdiction is limited to rulings under the Ethics Act. Thus, we cannot and do not, in this Advice, address the propriety of or answer any questions related to the propriety of your conduct in light of any code, statute, (federal or state), regulations, etc. other than the Ethics Act. However, under the Ethics Act we may provide a ruling because your conduct is subject to the requirements of that Act because you are or we assume, for purposes of this response that you are a "public employee" as that term is defined in the Ethics Act. See 65 P.S. §402. Under the Ethics Act, we must observe —the stated purpose of that Act which is to strengthen the faith and confidence of people and their government by assuring the public that the financial interests of the holders of or candidates for public office present neither a conflict nor the appearance of a conflict with the public trust. See Section 1 of the Ethics Act, 65 P.S. 5401. There are specific provisions of the Ethics Act which must be reviewed in this situation. Those provisions will be discussed more fully below. The Sections of the Ethics Act which will be discussed are Section 3(a), (b) and (c) of the Ethics Act, 65 P.S. §403(a), (b) and (c), respectively. We will address the provisions in Section 3(c) of the Ethics Act first. From the facts outlined above, it is not clear whether there will be any "contract" between you as a public employee and the Authority. However, if this were to occur, the provisions of Section 3(c) of the Ethics Act would apply and require that any contract in excess of $500 between a public employee or official and a governmental body must be made only after an "open and public process." The State Ethics Commission has interpreted this provision to apply and to require an "open and public process" when the particular public employee or official seeks to contract with the "governmental body" with which he is "associated." See Bryan, Opinion 80 -014 and Lynch, Opinion 79 -047. The governmental body with which you are "associated" is the Authority. Thus, assuming, for purposes of this advice, that a contract would be made between the Authority and yourself pursuant to the provisions of this Program, Section 3(c) of the Ethics Act would be applicable. Section 3(c) of the Ethics Act provides: Ms. Margaret A. Blair April 27, 1989 Page 3 (c) No public official or public employee or a member of his immediate family or any business in which the person or a member of the person's immediate family is a director, officer, owner or holder of stock exceeding 5% of the equity at fair market value of the business shall enter into any contract valued at $500 or more with a governmental body 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. Any contract made in violation of this subsection shall be voidable by a court of competent jurisdiction if the suit is commenced within 90 days of making of the contract. 65 P.S. §403(c). If Section 3(c) of the Ethics Act is applicable, it would require the following to be undertaken if a contract in excess of $500 were to be made between yourself there must be : 1. prior public notice of the contract possibility; 2. public disclosure of applications and contracts considered; and 3. public disclosure of the award of the contracts. Assuming that all of the guidelines as to an open and public process mentioned above have been or will be met, if Section 3(c) of the Ethics Act is applicable to your situation, we must next consider the other aspects of the propriety of your proposed conduct under other provisions of the Ethics Act. In this review, we note that we appreciate and recognize the concern that arises where the public program, funded with public monies and administered through a public agency, political subdivision, or governmental body is also available to public officials and /or employees of that agency or governmental body. We recognize the public concern and criticism that may arise if a public official or public employee who serves a governmental body receives benefits under a program of this nature. Thus, we must review this conduct in light of Section 3(a) of the Ethics Act and Section 3(b) of the Ethics Act. 14s. Margaret A. Blair April 27, 1989 Page 4 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). 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 official or public employee or candidate for public office would be influenced thereby. 65 P.S. S403(b). Under these Sections of the Ethics Act and the Opinions of the Ethics Commission, it is clear that the Ethics Act was primarily designed to restrict the activity of a public employee or official where a conflict of interests exists and to address situations where the appearance of a conflict with the public trust may arise. However, the Opinions of the Ethics Commission indicate that the Ethics Act was not designed nor should it be interpreted to preclude public officials or public employees from participating in programs which might otherwise be available to them as citizens. See Toohey, Opinion 83 -003; Balaban, Opinion 83 -004 and•Coploff /Hendricks, Opinion 83 -005. In these cases the Ethics Commission indicated that a public official or public employee or a business with which he is associated could participate in rehabilitation or grant programs so long as that public official or public employee: Ms. Margaret A. Blair April 27, 1989 Page 5 1. played no role in establishing the criteria under which the program at issue was to operate, particularly with reference to the structure or administration of the program; 2. played no role in establishing or implementing the criteria by which selections for program participation are to be or were made; 3. played no role in the process of selecting and reviewing applicants or in awarding grants or funds; 4. used no confidential information acquired during the holding of public office or public employment to apply for or to obtain such funds, grants, etc. Furthermore, the Commission's Opinions indicate that if the body with which the public employee or official is associated is in any way involved in the administering of the grant program or selecting who, among the applicants should receive assistance or funds, the public employee or official within the governmental body who is making an application to participate in such a program or to such funds, must abstain from all discussions, votes or recommendations on the applications or programs in which he or she is interested. Additionally, such a public official or public employee should also abstain from participating in matters before that governmental body which he or she serves as to the applications of other individuals who may be similarly situated and who are applying for funds or seeking to participate in the program. Essentially, the Commission sought to eliminate the possibility that a public official or public employee who was seeking such funds or seeking to participate in these grant programs would be in a position to insure the grant funds or the program benefits would be available to be applied for or applied to for his own benefit. Thus, a public official or public employee in such a situation should refrain from participating in making decisions or recommendations about the program and regarding distribution of the limited funds which might be available as a result of such a program. The reason for such abstentions must be placed on the public record. Based upon the facts as outlined above and as we understand them, we must now apply these principles to this case and particular circumstances. Essentially, we conclude that you may participate in the Program, as outlined above, without resigning from your position or relinquishing your role as a public employee. Under such circumstances, so long as the required abstentions discussed above are observed you may apply for and participate in the benefits associated with this Program. such. Ms. Margaret A. Blair April 27, 1989 Page 6 Finally, we must make reference to Section 3(b) of the Ethics Act in order to provide a complete response to your inquiry. Under Section 3(b) of the Ethics Act cited above, which you must observe, you must neither offer nor accept anything of value on the understanding or with the intention that your official judgment would be influenced thereby. We assume such a does not exist here. We add reference to this Section not to indicate that any such activity has been or will be undertaken but in a effort to provide a complete response to your inquiry. Conclusion: The Ethics Act and the rulings of the Ethics Commission reveal no reason to preclude you from participating in this Program as outlined above. So long as your conduct conforms to the guidelines discussed above, you may participate in this Program. If these guidelines are met you should encounter neither a conflict nor an appearance of conflict with the public trust under the Ethics Act in this situation. 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 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 in writing and must be received at the Commission within 15 days of the date of this Advice pursuant to 51 Pa. Code 52.12. Sincerely, Vincent J . Dopko General Counsel