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HomeMy WebLinkAbout87-517 NobleDavid A. Noble Department of Community Affairs Municipal Consulting Services Division Room 535, Forum Building Harrisburg, Pennsylvania 17120 STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 February 26, 1987 ADVICE OF COUNSEL 87 -517 Re: Former Public Employee; Section 3(e), Municipal Finance Consultant, Department of Community Affairs Dear Mr. Noble: This responds to your letter of January 23, 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 the Pennsylvania Department of Community Affairs. Facts: You currently are employed by the Pennsylvania Department of Community Affairs as a Municipal Finance Consultant in the Department's Bureau of Local Governmental Services. You further indicate that you are a certified public accountant and you are currently considering the possibility of developing a private accounting practice. As such, you have requested the advice of the State Ethics Commission relating to what, if any, restrictions are imposed upon you by the State Ethics Act. In your position with the Pennsylvania Department of Community Affairs, you are generally invovled in providing municipal and governmental accounting consulting assistance to local governments in the Commonwealth of Pennsylvania. A review of your job description indicates that your services were generally performed in three different areas. You were involved in the coordination of the Consultant Division's Pension Consulting Program, directing and supervising the divisions grant accounting technical assistance program, and providing municipal and governmental accounting consultant services. In addition to reviewing your job description, we have also reviewed the position specification, 1672. This document indicates that an employee in this position provides advance professional work relating to consultive services in the field of finance administration. An employee in this class develops, implements and evaluates a program of consultive services to assist local governments in increasing the David A. Noble February 26, 1987 Page 2 effectiveness of their financial and finance administration programs. An important aspect of this work is the participation on multi - discipline teams to develop programs of integrated services consultation and the testing of newly developed integrated services to operationalize the consutant's roles and activities. An important aspect of the work is direct continuous contact with local officials to proivide direct consultive services designed to increase the effectiveness of their finance administration. You also were responsible for making recommendations on overall consulting polices and goals for the department. As noted above, we have reviewed both your job description and classification specification and incorporated those documents herein by reference. In relation to this matter you have asked four specific questions as follows: 1. Whether you may participate in the audit of local governments as a private CPA. 2. Whether you may perform other accounting services for local governments. 3. Whether you may audit or perform other services with respect to grant funds that were distributed by the Department of Community Affairs. 4. Whether you may audit or perform other accounting services for municipalities who receive grant funds distributed by other Commonwealth agencies. 5. Whether you may be a principle in an accounting firm involved in the above items. 6. Whether you may be an employee of an accounting firm that does any of the aforementioned items. 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. As a Municipal Finance Consultant for the Pennsylvania Department of Community Affairs, hereinafter, the Department, you are to be considered a "public employee" 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. This conclusion is based upon your job description, which when reviewed on an objective basis, indicates clearly that you have the power to take or David A. Noble February 26, 1987 Page 3 recommend official action of a non - ministerial nature with respect to contracting, procurement, planning, inspecting or other activities where the economic impact is greater than de minimus on the interests of another person. See Conner, 84 -623. Consequently, upon termination of this employment, you would become a "former public employee" 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 employee 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 the 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 duties and responsibilities and based upon the facts outlined above, your jurisdiction, responsibility, influence and control appears to have been exercised within the Department's Bureau of Local Government Services, hereinafter the Bureau. Thus, the "governmental body" with which you have been "associated" upon the termination of your employment would be the Bureau. Therefore, within the first year after you would leave the Department, Section 3(e) of the Ethics Act would apply and restrict your "representation" of persons or new employers vis -a -vis the Bureau. The Ethics Act would not affect your ability to appear before agencies or entities other than with respect to the the Bureau. Likewise, there is no general limitation on the type of employment in which you may engage, following your departure from the Department. As a result, there is no general limitation on your becomming a principle or becomming associated with any particular CPA firm even though those firms may perform work for local governments that have had relationships with the Department or with the Commonwealth generally. 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 David A. Noble February 26, 1987 Page 4 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 Bureau), including, but not limited to, negotiations or renegotiations on contracts with the (2); 2. Attempts to influence the Bureau; 3. Participating in any matters before the Bureau over which you had supervision, direct involvement, or responsibility while employed by the Department; 4. Lobbying, that is representing the interests of any person or employer before the Bureau 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 bid, 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 Bureau, constitutes an attempt to influence your former governmental body. See Kilareski, 80 -054. Therefore, within the first year after you leave the Department, you should not engage in the type of activity outlined above. David A. Noble February 26, 1987 Page 5 You may, assist in the preparation of any documents presented to the Bureau so long as you are not identified as the preparer. You may also counsel any person regarding that person's appearance before the Bureau. Once again, however, your activity in this respect should not be revealed to the Bureau. Of course, any ban under the Ethics Act would not prohibit or preclude you from making general informational inquiries of the Bureau 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 Bureau your representation of, or work for your new employer. 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. In addition, it appears as though you did not participate, while an employee of the Department, in any of the grant approval or distribution activities of that agency. As such, there appears to be no reason why you may not participate in auditing local governments and providing other accounting services for local governments. 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). Conclusion: As a Municipal Finance Consultant, you are to be considered a "public employee" as defined in the Ethics Act. Upon termination of your service with the Pennsylvania Department of Community Affairs, you would become a "former public employee" 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 Bureau of Local Government Services. Further, should you terminate your employment or service, as outlined above, 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. David A. Noble February 26, 1987 Page 6 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 oh n J ontino A 'ng General Counsel