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HomeMy WebLinkAbout87-556 RoathMr. Howard Roath Department of Revenue 2850 Turnpike Industrial Drive Middletown, PA 17057 Dear Mr. Roath: STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 May 4, 1987 ADVICE OF COUNSEL 87 -556 Re: Former Public Employee; Section 3(e), Director of Marketing, Pennsylvania State Lottery This responds to your letter of April 20, 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 Department of Revenue. Facts: You currently serve as the director of marketing for the Pennsylvania State Lottery in the Department of Revenue. On May 4, 1987 you will terminate your employment with that entity to assume the position of director of marketing for Webcraft Games, in North Brunswick, New Jersey. In that position you will be responsible for servicing State lottery organizations throughout the United States. Your responsibility will be to provide supplemental data and information to the organizations to assist with the impl ementation of instant games and to work with the development of new lottery products. In your position with the Pennsylvania State Lottery your work was conducted under the limited supervision of the deputy executive director of the Pennsylvania State Lottery. You were authorized, in that position, to render important decisions on marketing matters and you were given wide latitude in relation to that responsibility. You were mainly responsible for the successful accomplishment of the division's rimar p y goal of promoting lottery ticket sales, determining suitable ticket outlets, designating sales material and types of advertising, and implementing marketing techniques. You directed a work force of 84 personnel located in the central headquarters as well as in field locations throughout the Commonwealth. You were responsible for preparing comprehensive marketing plans to increase sales and productivity. In your position you were responsible for developing inovative methods designed to promote lottery ticket sales, establishing and insuring the implementation of advanced modern marketing techniques. You were also Mr. Howard Roath May 4, 1987 Page 2 responsible for long -range planning to develop new marketing products. You participated with other lottery bureau executives on committee type projects to formulate suggestions /acquisitions of new types of lotteries. You also were responsible for planning and developing lottery retailer promotions and games and also for establishing prizes within guidelines established by the executive director of the lottery bureau. You also performed other major responsibilities as required. We have reviewed your job description and have incorporated that document herein by reference. You have requested the advice of the State Ethics Commission regarding what, if any, restrictions would be placed upon you within the purview of the State Ethics Act following your termination of employment with the Pennsylvania Department of Revenue. 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 director of marketing for the Pennsylvania State Lottery, Pennsylvania Department of Revenue, 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 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 Nelson, 85 -008; Schaffer, 85 -585. 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 Department of Revenue, hereinafter the Department. 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 Mr. Howard Roath May 4, 1987 Page 3 "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 Ewin9_, 79 -010. See also Kury vs. Commonwealth of Pennsylvania, State Ethics ommission, 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 Bureau of the Pennsylvania State Lottery, hereinafter the Bureau. This is so especially in light of your wide ranging responsibilities in relation to planning, coordinating, directing and controlling the marketing efforts of that entity. 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. 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. Mr. Howard Roath May 4, 1987 Page 4 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 the Bureau; 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. 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 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 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 to the above provisions of law, the State Ethics Act also provides as follows: Mr. Howard Roath May 4, 1987 Page 5 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). The Act defines executive -level state employee as follows: 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 deicison. 65 P.S. 402. You are advised as to the above provision of law, in that if you have participated in the type of activity outlined in section 3(g) you would be prohibited for a period of two years from being employed by any entity falling into the above category. 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 director of marketing for the Pennsylvania State Lottery, you are to be considered a "public employee" as defined in the Ethics Act. Upon termination of your service with the Pennsylvania Department of Revenue, you would become a "former public employee" subject to the restrictions Mr. Howard Roath May 4, 1987 Page 6 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 the State lottery. 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. 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. Sincer , zJohn J. Contino Acting General Counsel