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HomeMy WebLinkAbout86-510 WalkoDonald R. Walko, Jr., Esquire Attorney at Law 1040 Fifth Avenue Pittsburgh, PA 15219 Dear Mr. Walko: STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 Fehruary 4, 1986 ADVICE OF COUNSEL 86 - 510 Re: Former Employee Urhan Redevelopment Authority, Representation Restrictions This responds to your letter of January 14, 1986, wherein you requested the advice of the State Ethics Commission. Issue: Whether the Ethics Act places any restrictions upon the potential employment activities of a former Urban Redevelopment Authority employee. Facts: You advised that William J. Schwab has been an employee of the Urban Redevelopment Authority of Pittsburgh for the past six years. Specifically, he was employed in the Authority's Department of Housing as the Special Assistant to the Director of Housing. You indicate that Mr. Schwah's job responsihilities were of a general administrative nature. On December 13, 1985, Mr. Schwah resigned his position with the Urban Redevelopment Authority in order to hegin a consulting company. You indicate that this company will he involved in providing residential development consultant services to developers and community development corporation. Mr. Schwah intends to provide these services to interested parties for an hourly rate. The services will include loan packaging, development pro formas, project management, and marketing and leasing. The fee is based on actual hours of work performed and is not contingent on eventual project financing. You indicate that the fee will not include a portion of the project equity. You have requested the opinion of the State Commission in order to determine if there are any restrictions upon Mr. Schwab's potential activities. You indicate that clients of Mr. Schwab may be presenting proposals to the Urban Redevelopment Authority's Department of Housing seeking financial assistance. You indicate that neither Mr. Schwah nor his company will he personnaly representing the Donald R. Walko, Jr., Esquire February 4, 1986 Page 2 developer before the Urban Redevelopment Authority and they will not present the proposed deal to Urban Redevelopment Authority board members or staff members. You indicate that Schwab & Company will merely analyze and structure the proposed transaction. Discussion: At the outset, it must be noted that the State Ethics Commission may only address request within the purview of the State Ethics Act. The Commission will not offer advice with respect to the duties and the obligations that may he imposed by any other code of conduct or similar provision of law such as the Urban Redevelopment Law, or any federal codes or regulations that may be applicable. For the purpose of this advice, we will assume, that as an administrative employee in the Urban Redevelopment Authority's Department of Housing this individual was a public employee within the definition of that term as set forth in the State Ethics Act and the regulations of the State Ethics Commission. 65 P.S. , S402; 51 Pa. Code $1.1. As such, we will review the contemplated activities of this individual within various provisions of the State Ethics Act. Initially, the State Ethics Act provides as follows: Section 3. Restricted activities. (e) No former official or public employee shall represent a person, with or without compensation, on any matter before the governmental body with which he has been associated for one year after he leaves that body. 65 P.S. 403(e). Within the above provision of law, the State Ethics Act would apply and restrict your representation of persons who are new employers, including your own company, before your former governmental body, the Urban Redevelopment Authority of Pittsburgh, hereinafter the Authority including the Authority's Department of Housing. The Ethics Act would not affect your ability to appear before agencies or entities other than with respect to the Authority. Likewise, there is no general limitation on the type of employment in which you may engage, following your departure from the Authority. We do note, however, that the conflicts of interest law is primarily concerned with financial conflicts and violations of the public trust. The intent of the law generally is that during the term of a person's public employment he must act consistently with the public trust and upon departure from the public sector that individual should not be allowed to utilize his association with the public sector, officials or employees to secure for himself or a new employer treatment or benefits that may be obtainable only because of his association with his former public empl oyer. See Anderson, 83 -014; Zwi kl , 85 -004. Donald R. Wal ko, Jr., Esquire February 4, 1986 Page 3 In respect to the one year representation restriction, the Ethics Commission has promulgated regulations to define "representation" as follows: Section 1.1. Definitions. Representation - -- Any act on behalf of any person including but not limited to the following activities: personal appearances, negotiating contracts, lobbying, and submitting bid or contract proposals which are signed by or contain the name of the former public official or public employe. 51 Pa. Code 1.1. The Commission, in its opinions, has also interpreted the term "representation" as used in Section 3(e) of the Ethics Act to prohibit: 1. Personal appearances before the governmental body or bodies with which you have been associated, (that is the Authority), including, but not limited to, negotiations or renegotiations on contracts with the Authority; 2. Attempts to influence the Authority; 3. Participating in any matters before the Authority over which you had supervision, direct involvement, or responsihility while employed by the Authority; 4. Lobbying, that is representing the interests of any person or employer before the Authority in relation to legislation, regulations, etc. See Russell, 80 -048 and Seltzer, 80 -044. The Commission, has also held that preparing and signing a proposal, document or bid, or listing your name as the person who will provide technical assistance on such proposal , document, or bid, if submitted to or reviewed by the Authority, constitutes an attempt to influence your former governmental body. See Kilareski, 80 -054. Therefore, within the first year after you leave the Authority, you should not engage in the type of activity outlined above. You may, assist in the preparation of any documents presented to the Authority so long as you are not identified as the preparer. You may also counsel any person regarding that person's appearance before the Authority. Once again, however, your activity in this respect should not be revealed to the Authority. Of course, any ban under the Ethics Act would not prohibit or preclude you from making general informational inquiries of the Authority to secure information which is availahle to the general public. See Cutt, 79 -02.3. This, of course, must not be done in an effort to indirectly influence these entities or to otherwise make known to the Authority your representation of, or work for your new employer. flonal d R. Wal ko, Jr., Esquire February 4, 1986 Page 4 In addition to the foregoing, the Act further provides as follows: Section 3. Restricted activities. (b) No person shall offer or give to a puhlic 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. 403(b). Reference is made to this provision of law not to imply that there has or will be any violation of the State Ethics Act, but merely to provide a `complete response to your request. Thus, within the above provision of law, the future employment of the individual involved in the instant matter should not he based upon any action that this individual may have taken in his official capacity in relation to clients who now employ his services. The State Ethics Act further authorizes the State Ethics Commission to address other areas of conflict of interest. 65 P.S. , 5403(d). The parameters of the activities encompassed by this provision of law are generally determined by reviewing the intent and spirit of the State Ethics Act as it is set forth in Section 1 of the Act. 65 P.S. '5401. The Ethics Act was primarily intended to assure that the financial interests of puhlic officials and employees do not conflict with the public trust. Such a situation of conflict could arise, for example, if the individual in question in this situation were to accept employment from a client who has had previous applications before the Authority in which this individual was involved as a public employee. In such a situation, while the individual's actions as a public employee are not based upon any previous understanding that he would be subsequently obtaining empl oyment from this applicant, such future empl oyment could he perceived as being in violation of the State Ethics Act. Therefore, it may be the better practice for this individual to forego employment with any client who has had an application before the Redevelopment Authority in the past and in which this individual was involved as a public employee. Conclusion: As a former public employee, the administrative officer of the Urban Redevelopment Authority of Pittsburgh, Department of Housing, may not within one year after he terminates his empl oyment with that governmental body, represent any person before that body. Additionally, this individual should be mindful of Sections 3(b) and 3(d) of the State Ethics Act in the event that any conflicts of interests arise in the future. Donald R. Wai ko , Jr., Esquire February 4, 1986 Page 5 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 w i l l be issued. Any such appeal must he made, in writing, to the Commission within 15 days of service of this Advice pursuant to 51 Pa. Code 2.12. Si nce hn J. C• i General ounsel