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HomeMy WebLinkAbout87-511 YawE. Eugene Yaw, Esquire 433 Market Street P.O. Box 7 Williamsport, PA 17703 Dear Mr. Yaw: STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 1 71 08 -1 470 TELEPHONE (717) 783 -1610 February 11, 1987 ADVICE OF COUNSEL 87 - 511 Re: Trustees, Community College, Statements of Financial Interests This responds to your letter of January 9, 1987, wherein you requested the advice of the State Ethics Commission. Issue: Whether the members of the board of trustees of a community college are public officials within the purview of the State Ethics Act and thereby required to file Statements of Financial Interests._ You further have requested advice as to where such statements must be filed in the event that such filing is required. Facts: You advise that you are the solicitor for the Williamsport Area Community College. This institution was established pursuant to the Community College Act of 1963 as amended. You have requested the advice of the State Ethics Commission in light of recently promulgated regulations regarding the definition of public official. You have requested advice as to whether the board of trustees of an area community college would be public officials within the purview of the State Ethics Act, thereby required to file Statements of Financial Interests. You have also requested advice regarding the physical location for the filing of such statements, should they be required. Specifically, you have indicated that community colleges have generally been established through the efforts of local sponsors which may consist of a county, city, school district, borough, township or any combination thereof. The authority to establish a community college is derrived from the Community College Act of 1963 as amended and is authorized upon the approval of the Pennsylvania Department of Education. You further advise that a substantial portion of community college funding is directly received from the State. You requested the advice as to whether this statement should be filed with the community college, with the Department of Education or with some other organization or entity at the State or local level. E. Eugene Yaw, Esquire February 11, 1987 Page 2 Discussion: The State Ethics Act requires the filing of a Statement of Financial Interests by all public officials and public employees by May 1 of every year in which that official or employee holds public office and for the year after such individual leaves public employment. 65 P.S. §404(a), (d); Kremer v. State Ethics Commission, 56 Pa. Commw. Ct. 160, 424 A.2d 968, 1981; Carter, 79 -066. These Statements of Financial Interests are to contain the financial interests of the public official or employee for the prior calendar year. As originally promulgated, the State Ethics Act sets forth the definition of public official as follows: Section 2. Definitions. "Public official." Any elected or appointed official in the Executive, Legislative or Judicial Branch of the State or any political subdivision thereof, provided that it shall not include members of advisory boards that have no authority to expend public funds other than reimbursement for personal expense, or to otherwise exercise the power of the State or any political subdivision thereof. "ruoiic official" shah not include any appointed official who receives no compensation other than reimbursement for actual expenses. 65 P.S. 402. Based upon this definition, prior Commission opinions had established that the trustees of a community college were not public officials as that term was set forth above and, therefore, not required to file Statements of Financial Interests in accordance with Section 4 of the Act. Newton, 80 -025. This Commission opinion was based solely on the fact that these public officials were appointed and not compensated and, therefore, exempted from the definition of public official. In 1981, the Supreme Court of Pennsylvania issued a ruling specifically striking down as unconstitutional the last sentence of the aforceited definition. In Snider v. Thornburgh, 69 Pa. 159, 436 A.2d 593 (1981), the Court in reaching this conclusion determined that the appropriate remedy to be applied in such a situation would be to excise from the definition of public official the unconstitutional phraseology. As such, the exemption for appointed and non - compensated public officials is no longer legally applicable. While that definitional exemption is still contained in the statutory promulgation, the specific legal effect, at this point in time, would be that such definition is not applicable. As a result, the State Ethics Commission had promulgated specific rules and regulations clarifying the definition of public official as set forth in the regulations of the State Ethics Commission. The regulations of the State Ethics Commission, as promulgated on November 29, 1986, now provide as follows: E. Eugene Yaw, Esquire February 11, 1987 Page 3 Section 1.1. Definitions. Public officials - -- An elected or appointed official in the executive, legislative or judicial branch of the government of the Commonwealth or its political subdivisions. The terms does not include a member of an advisory board who has no authority to spend public funds other than reimbursement for personal expenses or to otherwise exercise the power of the State or a political subdivision thereof. (i) The following criteria will be used to determine if the exception in this paragraph is applicable: (A) The body will be deemed to have the power to expend public funds if the body may commit funds or may otherwise make payment of monies, enter into contracts, invest funds held in reserves, make loans or grants, borrow money, issue bonds, employ staff, purchase, lease, acquire or sell real or personal property without the consent or approval of the governing body and the effect of the power to expend public funds has a greater than de minimus effect on the interest of a person. (B) The body will be deemed to have the authority to otherwise exercise the power of the State or of a political subdivision if one of the following exists: (I) The body makes binding decisions or orders adjudicating substantive issues which are appealable to a body or person other than the governing authority. (II) The body exercises a basic power of government and performs essential governmental functions. (III) The governing authority is bound by statute or ordinance to accept and enforce the rulings of the body. E. Eugene Yaw, Esquire February 11, 1987 Page 4 (IV) The body may compel the governing authority to act in accordance with the body's decisions or restrain the governing authority from acting contrary to the body's decisions. (V) The body makes independent decisions which are effective without approval of the governing authority. (VI) The body may adopt, amend and repeal resolutions, rules, regulations, or ordinances. (VII) The body has the power of eminent domain, or condemnation. (VIII) The enabling legislation of the body indicates that the body is established for exercising public powers of the Commonwealth or a political subdivision. (ii) The term does not include judges and inspectors of elections, notary publics and political party officers. (iii) The term generaly includes persons in the following offices: (A) Incumbents of offices filled by nomination of the Governor and confirmation of the Senate. (B) Heads of executive, legislative and independent agencies, boards and commissions. (C) Persons who report directly to heads of executive, legislative and independent agencies, boards and commissions except clerical personnel. (D) Members of agencies, hoards and commissions appointed by the General Assembly or its officers. (E) School superintendents and assistant superintendents. (F) Persons appointed to positions designated as offices by code, charter or the like of the Commonwealth or its political subdivisions. E. Eugene Yaw, Esquire February 11, 1987 Page 5 (G) Members of municipal, industrial development, housing, parking and similar authorities. (H) Members of zoning hearing boards and similar quasijudicial bodies. (I) Members of other public bodies meeting the criteria set forth in subparagraph (i)(A). 51 Pa. Code §1.1 as amended 1986, 16 Pa. Bulletin 4653 As can clearly be seen from above, the issue as to whether or not a specific individual is a public official within the purview of the State Ethics Act now turns upon a finding of whether said individuals serves upon a board that is merely advisory in nature, that has no power to expend public funds, or that has no authority to exercise the power of the Commonwealth or a political subdivision. Thus, in determining whether the members of a board of trustees of a community college are public officials, we must first look to the appropriate criteria set forth in the above definition. In order to determine if the trustees of a community college appropriately fit this criteria, we must turn to the enabling legislation which sets forth the powers and duties of the board of trustees of a community college. Specifically, the Community College Act of 1963, as amended in 1985, provides as follows: POWERS AND DUTIES OF BOARD OF TRUSTEES (a) The affairs of any community college established under this act shall be administered and supervised by a board of trustees. Subject to any law and to any policies, standards, rules and regulations adopted by the State Board of Education provided for community colleges, the hoard shall, for the.purpose of establishing and operating and maintaining a community college, have the power, and its duty shall be: (2) To hold, rent, lease, sell, purchase and improve land, buldings, furnishings, equipment, material, books and supplies. (3) To enter into contracts for services with schools, colleges or universities, or with school districts or municipalities, to effectuate the purposes of this act. (4) To accept and receive gifts of real and personal property and Federal, State and local moneys and grants, and to expend the same. E. Eugene Yaw, Esquire February 11, 1987 Page 6 (5) To make policies providing for the admission and expulsion of students, the courses of instruction, the tuition and fees to be charged and for all matters related to the government and administration of college. (6) To submit to the State Board of Education for its approval proposed amendments to the comunity college plan. (7) To enter into contracts for services to high schools of member districts to provide area vocational- tehcnical education services. - (8) To exercise such other powers and perform such other duties as are necessary to carry into effect the purposes . of this act. (b) Contracts shall be entered into and other acts shall be done by the board of trustees of a community college in the name of the community college. The board of trustees shall submit an annual budget for consideration and approval by the local sponsor. The submission of the budget by the board of trustees shall constitute a "formal action" as defined by the act of July 19, 1974 (P.L. 486, No. 175), referred to as the Public Agency Open Meeting Law. The board of trustees shall supervise the expenditure of appropriations made by the local sponsor and shall conduct the business affairs of the community college in accordance with rules, regulations and procedures approved by the local sponsor. All property purchased by or granted to the board of trustees of a community college shall be held in the name of a community college on behalf of the local sponsor of the college. When the above powers and duties as enumerated in the enabling legislation are compared to the appropriate criteria in the definition of public official, it is clear that the individuals serving as trustees on community college boards are serving in a capacity that is more than mere advisory in nature. They clearly have the power to expend public funds and may exercise the authority of the Commonwealth or a political subdivision. As such, there is no doubt that these individuals would be public officials within the purview of the State Ethics Act. This analysis is clearly in accord with prior Commission precedent. See Dice, 85 -021. Thus, based upon all of the foregoing, you are advised that the members of the board of trustees of a community college are public officials within the purview of the State Ethics Act and must file Statements of Financial Interests by May 1, 1987. E. Eugene Yaw, Esquire February 11, 1987 Page 7 In relation to the second question that you have posed, the regulations of the State Ethics Commission provide as follows: §4.3.Appointed officials. (c) Any person appointed as an official not subject to confirmation in any governing body other than those specified in subsection (b) shall file a Statement of Financial Interests only with his governing body by May 1 of the year appointed or within 15 days if appointed after May 1. 51 Pa. Code 4.3(c). As can be observed from the above provision of the regulations, any appointed official, who is not subject to confirmation, will file his Statement of Financial Interests only with his governing body. The governing body for a community college would appear to be the board of trustees of that college and the appropriate location desginated by that governing body. This would be in line with the Commission's decision regarding municipal authorities. (See Pa. Bulletin March 22, 1986, Volume 16, Page 1009. Thus, pursuant to the aforementioned regulations and opinions of the Commission, you are advised that the Statements of Financial Interests for the members of the board of trustees of the Williamsport Area Community College may be filed with that governing body. The board of trustees may establish a central location for the filing of statements, such as with the Office of the president of the community college or the secretary of the board of trustees. These statements should be in a location that are accessible by the public during normal working hours. Conclusion: Trustees of a community college are public official's as set forth in the State Ethics Act and, as such, must file a Statement of Financial Interests in accordance with the law. Said statements should be filed in a central location, available to the public, as designated by the governing body. 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. E. Eugene Yaw, Esquire February 11, 1987 Page 8 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. Sinc ont o g General Counsel