HomeMy WebLinkAbout87-512 GrodeGeorge F. Grode
109 Allendale Way
Camp Hill, PA 17011
STATE ETHICS COMMISSION
308 FINANCE BUILDING
P.O. BOX 11470
HARRISBURG, PA 17108 -1470
TELEPHONE (717) 783 -1610
February 11, 1987
ADVICE OF COUNSEL
87 -512
Re: Former Public Official; Section 3(e), Insurance Commissioner
Dear Mr. Grode :
This responds to your letter of January 12, 1987, in which you requested
advice from the State Ethics Commission.
Issue: You ask whether the Ethics Act presents any restrictions upon your
potential employment following your termination of service with the
Pennsylvania Insurance Department.
Facts: You have served the Commonwealth of Pennsylvania for approximately 7
years in various positions. You served as Executive Director of the
Pennsylvania Commission on Crime and Delinquency from 1979 to 1983. You also
served as the Deputy Director of the Governor's Office of Policy Development
from 1983 to 1985. You have further served as Acting Secretary of the
Department of Aging and Acting Secretary of the Department of Agriculture
during the years 1984 and 1985. Since July, 1985, you have served as the
Insurance Commissioner for.the Pennsylvania Department of Insurance. You have
requested the advice of the State Ethics Commission regarding any restrictions
that may apply to you, within the purview of the State Ethics Act, regarding
your furture employment activities upon your termination of service with the
Commonwealth of Pennsylvania.
Discussion: At the outset, it must be noted that the Ethics Commission may
only address your question within the purview of the Ethics Act. The
Commission may not and will not offer advice with respect to any duties or
obligations that may be imposed by other provisions of law such as the State
Adverse Interest Act or the Governor's Code of Conduct. Because you have
provided no specific details regarding your future employment endeavors, this
advice will generally outline the parameters and restrictions set forth in the
Ethics Act. The further advice of the Commisssion may be necessary in the
event that specific questions arise at a future point in time.
George F. Grode, Commissioner
February 11, 1987
Page 2
As Insurance Commissioner for Commonwealth of Pennsylvania, you are to be
considered a "public official" within the definition of that term as set forth
in the Ethics Act and the regulations of this Commission. 65 P.S. §402; 51
Pa. Code §1.1. See Muir, 85 -018.
Consequently, upon termination of this employment, you would become a
"former public official" subject to Section 3(e) of the Ethics Act. Section
3(e) of the Ethics Act provides that:
Section 3. Restricted activities.
(e) No former official or public 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.
Initially, to answer your request we must identify the "governmental
body" with which you were associated while working with Commonwealth of
Pennsylvania. Then, we must review the scope of the prohibitions associated
with the concept and term of "representation ". In this context, the Ethics
Commission has previously ruled that the "governmental body" with which an
individual may be deemed to have been associated during his tenure of public
office or employment extends to those entities where he had influence,
responsibility, supervision, or control. See Ewing, 79 -010. See also Kury
vs. Commonwealth of Pennsylvania, State Ethics Commission, 435 A.2d 940
(1981).
From the description and analysis of your governmental service and based
upon the facts outlined above, your jurisdiction, responsibility, influence
and control appears to have been exercised in the Pennsylvania Department of
Insurance. We note that while you have served the Commonwealth of
Pennsylvania in a number of positions within the executive branch, you have
not served in any of those positions within the last year. As a result, you
have terminated your service and have been detached from those other entities
for more than a year. As such, there would be no restrictions regarding your
activities in relation to the other Commonwealth agencies on which you served.
See, Lyng, 87 -504. Thus, the "governmental body" with which you have been
"associated" upon the termination of your employment would be Pennsylvania
Department of Insurance. Therefore, within the first year after you would
leave the Department of Insurance, Section 3(e) of the Ethics Act would apply
and restrict your "representation" of persons or new employers vis -a -vis the
Department. Additionally, it is noted that in the event that you have served
on any other executive branch, committee or body as a result of your position
with the Department, additional restrictions may apply.
George F. Grode, Commissioner
February 11, 1987
Page 3
The Ethics Act would not affect your ability to appear before agencies or
entities other than with respect to the Department. Likewise, there is no
general limitation on the type of employment in which you may engage,
following your departure from the Commonwealth of Pennsylvania. 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 employer. See Anderson, 83 -014; Zwikl, 85 -004.
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 Department), including, but not
limited to, negotiations or renegotiations on contracts with the Department;
2. Attempts to influence the Department;
3. Participating in any matters before the Department over which you had
supervision, direct involvement, or responsibility while employed by the
Commonwealth of Pennsylvania;
4. Lobbying, that is representing the interests of any person or
employer before the Department 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 hid, 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 Department, constitutes an attempt to influence your former governmental
body. See Kilareski, 80 -054. Therefore, within the first year after you
leave the Commonwealth of Pennsylvania, you should not engage in the type of
activity outlined above.
George F. Grode, Commissioner
February 11, 1987
Page 4
You may, assist in the preparation of any documents presented to the
Department so long as you are not identified as the preparer. You may also
counsel any person regarding that person's appearance before the Department.
Once again, however, your activity in this respect should not be revealed to
the Department. Of course, any ban under the Ethics Act would not prohibit or
preclude you from making general informational inquiries of the Department to
secure information which is available to the general public. See Cutt,
79 -023. This, of course, must not be done in an effort to indirectly
influence these entities or to otherwise make known to the Department your
representation of, or work for your new employer.
In addition to the foregoing, and in order to be complete, you should
also be aware of the special provision of the Ethics Act relating to
executive -level employees.
In this respect the Act provides that:
Section 3. Restricted activities.
(g) No former executive -level State employee may for a
period of two years from the time that he terminates his
State employment be employed by, receive compensation
from, assist or act in a representative capacity for a
business or corporation that he actively participates in
recruiting to the Commonwealth of Pennsylvania or that he
actively participated in inducing to open a new plant,
facility or branch in the Commonwealth or that he actively
participated in inducing to expand an existent plant or
facility within the Commonwealth, provided that the above
prohibition shall be invoked only when the recruitment or
inducement is accomplished by a grant or loan of money or
a promise of a grant or loan of money from the
Commonwealth to the business or corporation recruited or
induced to expand. 65 P.S. 403(g).
Executive -level State employee is defined as:
Section 2. Definitions.
"Executive -level State employee." The Governor,
Lieutenant Governor, cabinet members, deputy secretaries,
the Governor's office staff, any State employee with
discretionary powers which may affect the outcome of a
State agency's decision in relation to a private
corporation or business or any employee who by virtue of
his job function could influence the outcome of such a
decison. 65 P.S. 402.
George F. Grode, Commissioner
February 11, 1987
Page 5
You, as Insurance Commissioner for the Commonwealth of Pennsylvania, are
clearly within this definition. Muir, 85 -018; Nelson, 85 -008.
Finally, the Commission has concluded that if you are administering an
existing contract as opposed to negotiating or renegotiating a contract, your
activities would not be prohibited by the Ethics Act. See Dalton, 80 -056 and
Beaser, 81 -538.
Additionally, we note that Section 403(b) of the State Ethics Act would
prohibit any public employee or public official from accepting a position of
employment if said position has been offered based upon the understanding that
the official conduct of the employee or official, while working for his former
governmental body, was influenced by such offer. See 65 P.S. §403(b). The
restrictions relating to former executive -level state employees would also be
applicable to you as noted above.
Conclusion: As a Insurance Commissioner, you are to be considered a "public
official" as defined in the Ethics Act. Upon termination of your service with
the Pennsylvania Department of Insurance, you would become a "former public
official" subject to the restrictions imposed by Section 3(e) of the Ethics
Act. As such, your conduct should conform to the requirements of the Ethics
Act as outlined above. Your governmental body for the purpose of the one year
representation restriction is the Pennsylvania Department of Insurance.
Further, you are reminded that the Ethics Act also requires you to file a
Statement of Financial Interests for the year following your termination of
service.
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.
Since
Con ino
ng General Counsel