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HomeMy WebLinkAbout84-613 StewartRichard W. Stewart, Esquire Stone, Sajar & Stewart 414 Bridge Street Post Office Box E New Cumberland, PA 17070 Dear Mr. Stewart: STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 September 27, 1984 ADVICE OF COUNSEL 84 -613 Re: Donald E. Schell, Jr., Collective Bargaining, Negotiating team, Contracting This responds to your letter of August 6, 1984, in which you requested advice from the State Ethics Commission. Issue: You ask what conduct is expected of a school director who is a 50% owner of a mail order prescription service company with respect to the school district's negotiation of a collective bargaining agreement that may include a demand for a contract for a prescription drug program. Facts: As solicitor for the West Shore School District, hereinafter, the School District, you are requesting an advisory opinion on behalf of a school board member, Donald E. Schell, Jr. with respect to his duties and obligations under the State Ethics Act. You indicate that Mr. Schell is currently a member of the school board but is also a 50% owner of a mail order prescription service company, hereinafter, referred to as the Company. The Company has a contract with National Prescription Administrators, hereinafter, NPA, to supply prescription drugs by mail to members of the Pennsylvania School Employees Benefit Trust, hereinafter, the Trust. NPA, in turn, has a direct contractual relationship with the Trust which is an organization affiliated with the Pennsylvania State Education Association, hereinafter, PSEA. The Trust was created essentially to serve employee benefit plans for school districts in the Commonwealth. Basically, Mr. Schell's company has a contract with the administrator of the Trust and, hence, the concern regarding his activities with respect to his position on the school board arise as a general matter. Richard W. Stewart, Esquire September 27, 1984 Page 2 However, you indicate that at the present time, the School District does not have any prescription drug program available to any of its employees. The current collective bargaining agreement between the School District and its professional employees who are represented by the West Shore Education Association, hereinafter, WSEA, an affiliate of PSEA, will expire next July. Negotiations on this collective bargaining agreement are expected to commence within the next several months. It is not known, of course, whether or not the professional employees will make a demand for a prescription drug program although such programs frequently the subject of collective bargaining talks. The usual practice, if such a prescription drug program is to be made part of the collective bargaining agreement, is that the actual provider of services is not named in the collective bargaining agreement. The actual service is or would be put out on bid by the School District. There are, of course, suppliers of such service in addition to the Trust with which Mr. Schell's Company has a contract. Nevertheless, Mr. Schell wishes to have our response with respect to the following questions: 1. May he continue to serve on the District's collective bargaining negotiating team if the employee representatives make a demand for a prescription drug program? 2. May he vote on the collective bargaining agreement that contains a prescription drug program? 3. Should he abstain from voting on any motion to award a contract to the Trust for a prescription drug program? Discussion: As a School Board director, Mr. Schell is clearly a "public official" as that term is defined in the State Ethics Act. Accordingly, his conduct as a "public official" must conform to the requirements of the State Ethics Act including Section 3(a) of the Act which states as follows: 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. The Commission has concluded that in order to comply with Section 3(a) of the Ethics Act, where a public official may be a contractor or subcontractor on a project or development over which a township board of supervisors, for example, has review authority, that supervisor must: Richard W. Stewart, Esquire September 27, 1984 Page 3 1. Not use his official position to obtain such employment; 2. Not utilize confidential information gained in his official capacity to secure such employment; 3. Refrain from voting on a developer's plans where he will seek, has been asked or can reasonably and legitimately anticipate being asked to perform work for the project - developer; 4. Refrain from voting on matters related to a developer from whom he obtains work where he, as a supervisor, may be asked to vote on matters which arise after he has obtained such work; and 5. Make public his relationship with the project or developer and the reasons for his abstention as required by No. 3 and No. 4 immediately above. This public disclosure requirement has been said to be met by an announcement at a public meeting of the municipality involved. Sowers, 80 -050. Applying these principles to the situation outlined in this case, it is easy to answer your last question first. Specifically, should there be a question presented to the School Board regarding the award of a contract to the Trust for a prescription drug program where Mr. Schell knows that his Company has or can reasonably be expected to obtain or be asked to supply services to the Trust through NPA or his Company, he should abstain from discussions and decisions of the School Board with respect to such questions. Likewise, with respect to your question of whether or not Mr. Schell should vote on a collective bargaining agreement which contains a prescription drug program, the response is similar to that set forth in Sowers. Specifically, if the trust is named in the collective bargaining agreement and /or if Mr. Schell knows that he will seek or has been asked or can reasonably anticipate that he will be asked or seek to perform the work under the collective bargaining agreement then he must, abstain from participating in the School Board's decisions regarding this collective bargaining agreement. Thus, even though, typically, the collective bargaining agreement would not contain a reference to the particular provider of services under the agreement as to the prescription drug program, Mr. Schell must abstain from participating in the vote on the collective bargaining agreement itself as a member of the School Board if these circumstances exist. Finally, returning to your first question, you ask whether Mr. Schell may continue to serve on the District's collective bargaining negotiating team if the employee representatives make a demand for a prescription drug program. There is no specific provision of the Ethics Act nor opinion of the Ethics Commission which can be referenced to require Mr. Schell to abstain from participating as a member of the District's collective bargaining negotiating team under such circumstances. However, as with our responses to each of the questions outlined in your letter, we will assume that Mr. Schell's conduct, Richard W. Stewart, Esquire September 27, 1984 Page 4 in any of these circumstances, is not such that he is using confidential information acquired through the use of his office, or as a member of the negotiating team, for example, to "mold" or direct the negotiations in such a manner as to benefit his Company or NPA or the Trust. Mr. Schell must be particularly careful if he continues to serve as member of the District's collective bargaining negotiating team to avoid such actions or the appearance of such actions. Conclusion: In direct response to your questions as they were presented we provide the following response: 1. Mr. Schell, so long as he does not "mold" or seek to direct the district's collective bargaining position or team to accept a damand for a prescription drug program so that his Company, the Trust on NPA will be beneffitted, may continue as a member of the District's collective bargaining negotiating team even where such a demand has been made. 2. To comply with the Ethics Act and to avoid an appearance of a conflict of interest with the public trust Mr. Schell should not vote on a. collective bargaining agreement where the collective bargaining agreement contains a prescription drug program provision where the Trust is named and /or where he knows or has reason to believe that his Company will seek or operate under contract with NPA to supply the Trust which in turn may a contract with the District to provide services under this prescription drug program. 3. Mr. Schell should, likewise, abstain from voting on any motion made by the School Board or award a contract to the Trust for services under this prescription drug program where he knows, has reason to know, or can reasonably expect that his Company, pursuant to its contract with NPA, will supply the Trust with services to fulfill the prescription drug program provisions of the collective bargaining agreement. 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. Richard W. Stewart, Esquire September 27, 1984 Page 5 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 full 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. SSC /na Sandra S. Chris anson General Couns