Loading...
HomeMy WebLinkAbout87-514 FaberW. Russell Faber Greenlee Associates Suite 410 10 S. Market Street P.O. Box 291 Harrisburg, PA 17108 STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 February 18, 1987 ADVICE OF COUNSEL §7 -514 Re: Conflict of Interest, Consultant, Sub - contractor, Governmental Agency, Representation of Individuals for Agency Dear Mr. Faber: This responds to your letter of January 12, 1987, wherein you requested the advice of the State Ethics Commission. Issue: Whether the State Ethics Act presents any prohibitions upon your firm's activities as a sub- contractor to a lead firm relating to a governmental contract when your firm also may represent individuals before the governmental agency awarding said contract. Facts: You advise that you are currently employed as a partner in Greenlee Associates, a public relations and computer services firm, in Harrisburg, Pennsylvania. The firm represents a number of clients regarding matters that come before the legislative and executive branches of state government. This firm also performs computer consulting and public relation services for clients in various non - govermental areas. You advise that Greenlee Associates has been approached by a national management firm to provide sub - contracting consulting services to that firm in their performance of a contract with an executive branch agency. This management firm will bid on the . executive branch agency's contract in the near future. You advise that the services that Greenlee Associates would provide to the lead firm, in support of their performance under the contract, would consist of computer systems and needs analysis and would be at the direction and authority of representatives of the firm. You advise that you would not be under the direction of any state governmental agency. W. Russell Faber February 18, 1987 Page 2 You advise that it is possible that concurrent with your performance as a sub - contractor, your firm might have the occasion to represent one or more of your other clients in a governmental relations capacity before the state governmental agency which has issued the contract to the national management firm. You advise that it is highly unlikely that any of the agency representatives contacted in your company's governmental relations role for private clients would have any reason to be aware of or have participated in any way in your work for the management firm for which you will provide sub - contracting services. You have requested the advice of the State Ethics Commission as to whether the State Ethics Act is applicable to this situation. Discussion: The State Ethics Act, generally, was promulgated in order to insure the public that the financial interests of their officials and employees do not conflict with the public trust. 65 P.S. §401. In this respect, the Ethics Act applies to public employees and public officials serving at both local and state levels of government. Generally, the State Ethics Act provides for definitions of both public official and public employee which are 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. "Public official" shall not include any appointed official who receives no compensation other than reimbursement for actual expenses. 65 P.S. §402. "Public employee." Any individual employed by the Commonwealth or a political subdivision who is responsible for taking or recommending official action of a nonministerial nature with regard to: (1) contracting or procurement; (2) administering or monitoring grants or subsidies; (3) planning or zoning; (4) inspecting, licensing, regulating or auditing any person; or (5) any other activity where the official action has an economic impact of greater than a de minimus nature on the interests of any person. W. Russell Faber February 18, 1987 Page 3 "Public employee" shall not include individuals who are employed by the State or any political subdivision thereof in teaching as distinguished from administrative duties. 65 P.S. §402. Generally, various judicial decisions have been rendered which clarify that independent consultants who are employed on a limited basis by governmental bodies and only perform services on a short -time basis for governmental bodies are not to be considered public employees within the purview of the State Ethics Act. See, Ballou v. State Ethics Commission, 496 Pa. 127, 436 A.2d 186, (1981); Rogers v. State Ethics Commission, 80 Pa. Commw. Ct. 43, 470 A.2d 1120 (1984). It should be noted that the State Ethics Commission has reviewed a similar situation, in the past, regarding the employment of an attorney by a governmental agency by way of service purchase contract. The Commission in that opinion noted that the State Ethics Act applied to public officials and employees as noted above. The Commission further noted as follows: Obviously, the Ethics Act extends to individuals "employed by" the Commonwealth or a political subdivision. The Ethics Act does not by its very terms or its intent, however, exempt individuals "employed by" the Commonwealth solely on the basis that their relationship is based on a Service Purchase Contract. Hence, the existence of this relationship is not per se a bsis for excluding or including individuals from the coverage of the Ethics Act. This question must and should be resolved with reference to the purpose of the Act itself and in light of the aims of the Act. Basically, if a person is employed in a position of public trust which could be abused, the Ethics Act would apply regardless of the formal basis (service purchase contract, employed at will, common law servant) for that relationship. Of course, the circumstances surrounding a relationship are indicia by which to judge whether an individual is "employed by" the Commonwealth in such a position of public trust. For example, if the relationship is continuing in nature, the person so employed may tend to enjoy a status which might be considered more likely to be covered by the Ethics Act than not. Also factors to consider might include: Whether the work performed is identical to or similar to the work which would be performed by full -time regular employees; whether or not the person expects to continue W. Russell Faber February 18, 1987 Page 4 in such service or has a history of such service; whether the person is supervised and /or directed by the Commonwealth or political subdivision; and whether the person assumes a relationship with the Commonwealth or political subdivision which would, in fact, be one, which in the opinion of the Commission would be one where the - public trust could be implicated. Massiah- Jackson, 80 -036. Thus, it is clear that the Commission will not automatically exempt someone from Ethics Act coverage based solely the procedural mechanism through which they are employed. The Commission must review such situations based upon the totality of the circumstances. In the instant situation, the facts indicate that you will not be employed directly by any governmental agency. While you will be operating as a sub - contractor in relation to a governmental contract, it appears as though you will have limited dealings in your role as a sub - contractor with the executive branch agency awarding said contract. In this respect, it appears as though you would not be considered a public official or public employee within the purview of the State Ethics Act. As such, the Ethics Act would not be applicable to your situation. We do note that the Ethics Act does have certain provisions that relate to individuals outside of the definition of public official and public. employee. In this respect, the Act provides as follows: Section 3. Restricted activities. (b) No person shall offer or give to a public 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). We, of course, reference to the above provision of law not to indicate that there will be any implication of this provision of law but merely to provide a complete response to the question you have posed. W. Russell Faber February 18, 1987 Page 5 Conclusion: Based upon the description of the activities, as outlined in your letter of request, it does not appear as those the Ethics Act would apply to you or your firm when acting as a consultant on a sub - contracted basis to a firm that has a contractual relationship with an executive branch agency on a short -term basis. You are not to be considered a public employee or public official within the purview of the State Ethics Act. The provision of the State Ethics Act relating to individuals not considered public employees and public officials would be applicable to you and such provisions have been noted above for your information. 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. Si John r. Conti no A ng General Counsel