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HomeMy WebLinkAbout83-576 MageeMr. David I. Magee 114 North Carlisle Street P.O. Box 311 New Bloomfield, PA 17068 Dear Mr. Magee: _ Mailing Address: STATE ETHICS COMMISSION P.O. BOX 1 179 HARRISBURG, PA 17108 TELEPHONE: (717) 783 -1610 July 18, 1983 ADVICE OF COUNSEL RE: County Office; Contracting; Printing Business 83 -576 This responds to your letter of June 13, 1983, in which you requested advice from the State Ethics Commission. Issue: You request advice as to whether Perry County may continue to do business with a printing company in which you own stock if you are elected to a County office. Facts: You are a candidate for County office in Perry County hereinafter, the County, and the office for which you are running is the Register and Recorders Office. You state that you own stock in the printing company and do printing work for the County, and that most of the County printing you do is awarded by bid. You would like to know whether your printing company will be able to continue to do printing work for the County if you are elected to public office. Discussion: As an elected County official of Perry County, there is no doubt that you would be a public official within the meaning of that term as set forth in the Ethics Act, 65 P.S. 401 et seq. Accordingly, your conduct as a County official would be governed by the Ethics Act. However, while the Act contains some restrictions against contracts between a public employee and the governmental body with which he is associated (the County), the Act does not totally prohibit a person from engaging in outside businesses, employment or other ventures on their own time. Essentially, the Ethics Act precludes engaging in ventures which would constitute a conflict of interest with your public employment. The Ethics Commission has defined a "conflict of interest" as existing where an individual represents two or more persons whose interest are adverse to each other. See Alfano, 80 -007. While the situation you present does not constitute a per se conflict of interest, you should be aware - of some other restrictions that would apply to you under these circumstances and the Ethics Act if you were to be elected to County office. State Ethics Commission • 308 Finance Building • Harrisburg, Pennsylvania Mr. David I. Magee July 18, 1983 Page 2 Section 3(a) of the Ethics Act provides that no public official should use his public office or any confidential information obtained through holding public office to acquire financial gain for himself, his immediate family, or a business with which he is associated. 65 P.S. 403(a). "Business" with which you are "associated" is defined as: "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. 403(a). Under this definition, you are clearly "associated" with the printing company in which you own stock. Thus, you may not use your position as an elected County official if you are elected, to secure financial gain for your business, the printing company, nor may you pass any confidential information acquired through being an elected County official to the printing company. Section 3(b) of the Act states that no person shall give to a public official /employee, nor shall any public official /employee accept, any thing of value based on any understanding that the official's vote, action or judgment would be influenced thereby. 65 P.S. 403(b). Future or continued employment, future income from the printing company, etc. are things of value and, thus, you may not allow your official actions or judgments as an elected official to be affected by such promises from the printing company. Similarly, the Ethics Act would apply to the printing company as a "person" as that term is defined in the Act to include a corporation, and would preclude this company, under Section 3(b) of the Ethics Act, from offering any thing of value to you or any other a public official /employee based on the understanding that the official's conduct would be influenced thereby. Further, Section 3(c) of the Act states that no public official, member of his immediate family or any business in which the person or member of his immediate family is an officer, director or owner of greater than 5% of the equity at fair market value, may contract in an amount in excess of $500, with the governmental body with which the official is associated unless the contract has been awarded through an open and public process. See Howard, 79 -044. Previous opinions of the Commission have held that the term "governmental body" in Section 3(c) refers to the governmental body with which the public official is "associated." Bryan, 80 -014; and Lynch 79 -047. Therefore, the "open and public process" limitation of Section 3(c) would apply if you or your family hold stock exceeding 5% of the equity of the printing company or if you or your family are a director, officer, owner, if and when, the printing company attempts to contract with the County. Mr. David I. Magee July 18, 1983 Page 3 It must be emphasized that Section 3(c) presents no absolute prohibition on a contract between the printing company and the County. Section 3(c) requires, however, that any contract valued in excess of $500 be awarded only after an open and public process. In its opinion in Howard, 79 -044, the Commission stated that an open and public process must meet the following criteria: 1. prior public notice; and 2. public disclosure of all proposals considered; and 3. public disclosure of the award of the contract. If these standards are complied with and competitors have a reasonable time within which to submit their proposals, the printing company (if you or a member of your immediate family hold the positions or the 5% interest as set forth in this Section), could contract with the County for a contract in excess of $500. You should also insure that even the appearance of a conflict of interest with the public trust will not arise. See Section 1 of the Ethics Act, 65 P.S. 401. Thus, where any bids are submitted to the County for consideration, you are advised that to avoid the appearance of a conflict of interest, by keeping your name off of any bids submitted if possible, and by refraining from personally negotiating on a contract awarded through such bids. Finally, if the printing company does contract with the County in accordance with Section 1 of the Ethics Act, in order to avoid any appearance of a conflict of interest, you must abstain from any action, review and recommendation, or other process of consideration of the award of the contract to the printing company where you were acting as a County official. The reasons for this abstention should be placed on the public record. Conclusion: As a public official and a stock - holder in the printing company, you must avoid any conflict of interest by complying with the requirements of Sections 3(a) and (b) of the Ethics Act by not using confidential information gained through holding public office to obtain financial gain and not accepting or offering any thing of value for favorable official actions. The company, because of your association with the company (if this falls within the category of director, officer, owner or holder of stock of 5% of the equity at fair market value) and as County official, may enter into a contract with the County valued in excess of $500, only if that contract is awarded after an open and public process in compliance with Section 3(c) of the Ethics Act, which provides for: Mr. David I. MaGee July 18, 1983 Page 4 1. prior public notice; and 2. public disclosure of all proposals considered; and 3. public disclosure of the award of the contract. When the County considers whether or not to award the contract to the printing company, you must, in order to avoid any conflict of interest or the appearance of a conflict of interest under Section 1 of the Ethics Act, abstain and make this part of the public record from any participation in the decision - making process of whether or not to award the contract or by which the contract is awarded. Additionally, where any bids are submitted to the County for consideration, you should keep your name off of any such bids if possible and refrain from the negotiation of any contract awarded through such bids. 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 2.12. CW /rdp Sincerely, • Sa dra S. r'stianson General Counsel