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HomeMy WebLinkAbout82-555 JonasMarc D. Jonas, Esquire Hamburg, Rubin, Mullin & Maxwell Attorneys At Law 800 East Main Street Lansdale, Pennsylvania 19446 Mailin Address: STATE ETHICS COMMISSION P.O. BOX 1 179 HARRISBURG, PA 17108 TELEPHONE: (717) 783 -1610 June 8, 1982 ADVICE OF COUNSEL RE: Township Official, Engineering Firm Dear Mr. Jonas: 82 -555 This responds to your communication of May 24, 1982 in which you requested advice from the State Ethics Commission. Issue: You question whether a member of a governing body may be employed by an engineering firm where that firm operates as the engineer for the Township consistently with the provisions of the Ethics Act? Facts: You serve as solicitor for a Township in Montgomery County. This particular Township is governed by a five - person governing body and, in accordance with the applicable municipal code, employs an engineering firm as a consultant as the need arises. This particular engineering firm has served the Township as engineering consultant for approximately Seven years and although the Township reorganizes at the beginning of each year the engi- neering firm has been retained from year to year without any yearly review process. The services of this firm are compensated for by a small retainer plus compensation for work actually performed on behalf of the Township. In this regard this amount is assumed to be in excess of $500 per year. A member of the governing body who is in his second term of office will be employed by the engineering firm. He will assume the role of Vice - President of the firm but will be neither a director nor share holder. He will be compensated purely on a salary basis. The engineering firm and the member of the governing body who will be employed by the firm have already agreed on certain restrictions to be announced publicly at a Township meeting and to be placed on the public official in question in relation to his proposed employment. These restric- tions are: State Ethics Commission • 308 Finance Building • Harrisburg, Pennsylvania Marc D. Jonas June 8, 1982 Page 2 1. The member of the governing body will not participate in any Township considerations and decisions concerning the nature of the work, compensation, etc., of the Township engineering firm. 2. The member of the governing body will not officially or unofficially reprEsent the engineering firm on behalf of this particular Township. 3. The member of the governing body will not perform any of the Township engineer's work for this particular Township, including office work. Essential y, then, a member of the governing body who will be employed by the Township's engineering firm will p_arforn; work on private contracts as well as contracts for other municipalities only. Discussion: As an eiected official, the Township official (hereinafter the public official) in question is a public official within the definition of the Ethics Act. See 65 P.S. 402. As such his conduct must conform to the requirements of the Ethics Act. The particular question net you raise is whether or not this public official may be employed by the engineering firm which has been retained by the Township. Essentially, the Ethics Act does not totally preclude this type of employment. This is p'rticularly true where the election or appointment of the individual predated the Ethics Act and where the person in question is a public official prior to the time he would assume a role as 'n employee of the engineering firm. See Hock, 79 -017 and DeWane, 80• -018. In the factual circumstances which you present, the fact that the individual's election and his status as a public official predated his proposed employment by the engineering firm indicates that the employment by the engineering firm should not be precluded by the provisions of the Ethics Act at this time. However, there is some question as ':c the applicability and the extent of the prohibitions contained in Section 3(c) of the Ethics Act. Section 3(c) provides that no public official or public employee or a business in which that person is a director, officer, owner or holder of stock exceeding 5% of the equity at fair market value of the business shall enter into a contract valued at more than $500 with the governmental body with which he is asso- ciated unless that contract has been awarded through an open and public process. Essentially, due to the fact that the public official in question will serve as a Vice - President (Officer) of the engineering firm there may be some future question about the applicability of Section 3(c) of the Ethics Act. Marc D. Jonas June 8, 1982 Page 3 This question, however, would arise when the new contract (reorgani- zation) would be proposed or renewed between the Township and the engineering firm with which the public official will now be serving as a Vice- President. Prior decisions of the Commission would seem to indicate that from the time that a public official acquires two positions or two contracts there must be compliance with the provisions of Section 3(c). See King, 79 -034. This possible application of Section 3(c), thus, would arise only at that point in time when the engineering firm would seek to recontract or be reappointed as the officially designated engineer for the Township, because only at that point in time would a contract be proposed between the public official's business (in which he serves as officer, Vice - President) and the governing body in which he serves. Incidentally, we note that it is true that personal and professional services are typically not covered by the bid procedures set forth in the various municipal codes. See Cantor, 82 -004 and Fields, 82 -006. This is true because professional and personal services contracts should not necessarily be awarded to the "lowest bidder" although they should be awarded consistent with the public interest. However, as you can see, these opinions of the Commission do not require that even if Section 3(c) were to be applied to your situation that a "bid process" be initiated with the attendant requirement that the lowest responsible bid must be accepted. In fact, even if Section 3(c) were to be applicable upon the reorganization and /or the renewal of the contract in question with the engineering firm and the Township, the only requirement would be that there be prior public notice of the contract possi- bility within sufficient time for a reasonable and prudent competitor to be able to prepare and submit an application; that there be public disclosure of all the applications and proposals considered and that there be public disclosure of the contract awarded or offered and accepted. Of course, the public official in question must abide by those criteria which you have outlined above in No. 1, 2 and 3 so as to avoid even the appearance of any impropriety. In addition, Section 3(a) of the Ethics Act compels the public official in question to restrain himself from using his public office in any way (through discussions with other members of the governing board, for example,) in order to secure the appointment or reappointment of the engineering firm -- a business with which he is asso- ciated as an employee and officer. This same Section precludes him from using any confidential information that he might have received through his holding of public office to assist his firm in any manner. The three restrictions which you have indicated above should probably be sufficient to avoid any violations of Section 3(a) of the Ethics Act and any appearance of any conflict of the public trust. Marc D. Jonas June 8, 1982 Page Conclusion: The Ethics Act does not prohibit the public official in question from being employed in the capacity as Vice - President with the engineering firm which serves as official Township engineer at the present time and under the circumstances as you have presented. However, you may wish to resubmit the question of whether or not Section 3(c) has any application to any further contracting between the engineering firm and the Township as set forth above. 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 may be scheduled and a formal Opinion from the Commission will be issued. You should make such a request or indicate your disapproval of this Advice within the next 30 days. SSC /rdp Sincerely, ler il ' 44 of dra S. Chris anson General Counsel