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HomeMy WebLinkAbout87-578 SchiavelloDomenick V. Schiavello c/o Erick H. Auerbach Chief Assistant City Solicitor Law Department 15th Floor, Municipal Services Building Philadelphia, PA 19102 -1692 Dear Mr. Schiavello: STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PA 17120 TELEPHONE: (717) 783 -1610 May 21, 1987 ADVICE OF COUNSEL 87 -578 Re: City Employee, Daughter, Employee Of Business On Contract With City This responds to your letter of May 4, 1987, wherein a request for advice under the State Ethics Act was submitted on your behalf by the Philadelphia Office of City Solicitor. Issue: Whether the State Ethics Act presents any prohibitions upon your conduct as a public employee when your daughter is employed by a company doing business with the city. Facts: You currently serve as the Director of Automotive Services Division for the City of Philadelphia, Department of Public Property. In this respect, you are involved in the inspection of vehicles purchased by the city and are responsible for determining whether the city should accept or reject delivery of vehicles so purchased. Your daughter who is not a minor dependent has considering accepting part -time employment with a business that currently sells vehicles to the City of Philadelphia. In her position with this company, your daughter would be painting custom lettering on these vehicles. While your unit is not involved in the procurement process, you are responsible for inspecting vehicles purchased and by the city and as part of that duty you are responsible for inspecting the lettering on such vehicles and have the authority to accept or reject new vehicles after the inspection process. To date, no vehicle has been rejected for defective lettering. In addition to the foregoing, the city purchases these vehicles through a competitive bidding process. You have requested the advice of the State Ethics Commission regarding whether any prohibitions are placed upon you under the State Ethics Act in light of the foregoing situation. Discussion: As the Director of the Automotive Services Division for the City of Philadelphia, you are a public employee as that term is defined in the State Ethics Act and therefore subject to the provisions of that law. 65 P.S. §402; 51 Pa. Code §1.1. The State Ethics Act in part provides as follows: Domenick V. Schiavello May 21, 1987 Page 2 Section 3. Restricted activities. (a) No public official or public employee shall use his public office or any confidential information received through his holding public office to obtain financial gain other than compensation provided by law for himself, a member of his immediate family, or a business with which he is associated. 65 P.S. 403(a). Within the above provision of law, no public employee may use his position in order to obtain a financial gain for a member of his immediate family. The Act defines member of one's immediate family as follows: Section 2. Definitions. "Immediate family." A spouse residing in the person's household and minor dependent children. 65 P.S. 402. From a review of the foregoing circumstances, it appears as though your adult daughter would not be within the strictures of the definition of immediate family as set forth in the State Ethics Act. As such, it would appear as though there would be no prohibitions placed upon your activities as a public employee within the above provision of the State Ethics Act. It should be further noted that section 403(a) of the State Ethics Act also provides that a public employee may not use his public position to obtain a financial gain for a business with which one is associated. Business with which one is associated is defined as follows: Section 2. Definitions. "Business with which he is associated." Any business in which the person or a member of the person's immediate family is a director, officer, owner, employee or holder of stock. 65 P.S. 402. In the event that your daughter had been within the definition of immediate family member as previously set forth, then you would have been considered associated with this business as a result of the definition set forth above in that a member of your immediate family would have been an employee of the business. In light of the fact, however, that your daughter is not a member of your immediate family as set forth in the State Ethics Act, this consideration would not be relevant. In addition to the foregoing however, the State Ethics Commission is also authorized to address other areas of conflicts of interest. 65 P.S. §403(d). Generally, the parameters of the types of activities encompassed by this provision of law have been reviewed in light of the preamble to the State Ethics Act which enunciates the legislative intent of the law. That intent, as set forth in section 1 thereof, is to ensure that the financial interests Domenick V. Schiavello May 21, 1987 Page 3 of a public official do not conflict with the public trust. 65 P.S. §401. A conflict of interest will arise in any situation where the official is serving one or more interests that are adverse. Alfano, 80 -007. As a result of this provision of law and in light of the intent of the State Ethics Act this Commission has on a number of occasions determined that the definitional limitations applicable to section 3(a) of the State Ethics Act are not relevant to questions that arise under section 403(d) or section 1 of the law. As a result, this Commission has previously determined that it would be the better practice for a public official to abstain from participating in matters that involves his adult son, O'Reill , 83 -012; adult daughter, Cumberledge, No. 216 -R, or sister, Leete, 28 005. Thus, within these previously determined opinions of the Commission, it would be the better practice for you as a public employee to refraim from participating in the review or inspection of a matter in which your adult daughter has been involved. In the event that you would refraim from participating in such inspections, then the State Ethics Act would appear to place no other restrictions upon your conduct as a public employee. In order to complete, it should also be noted that the State Ethics Act provides as follows: Section 3. Restricted activities. (c) No public official or public employee or a member of his immediate family or any business in which the person or a member of the person's immediate family is a director, officer, owner or holder of stock exceeding 5% of the equity at fair market value of the business shall enter into any contract valued at $500 or more with a governmental body unless the contract has been awarded through an open and public process, including prior public notice and subsequent public disclosure of all proposals considered and contracts awarded. Any contract made in violation of this subsection shall be voidable by a court of competent jurisdiction if the suit is commenced within 90 days of making of the contract. 65 P.S. 403(c). In the instant situation it appears as though this provision of law would not be applicable. This is so specifically in light of the fact that it does not appear as though your daughter is either a director, officer, owner or holder of stock exceeding 5% of the equity of the entity by which she is employed. As such, the above provision of law would not be applicable and would place no prohibitons upon your conduct in the instant situation. In the event, however, that a situation should develop wherein additional conflicts of interest should arise, you may wish to seek the further advice of this Commission. You abstention in matters regarding the inspection of Domenick V. Schiavello May 21, 1987 Page 4 vehicles on which your daughter has performed work should also be recorded in appropriate department files. Finally, in order to be complete we note that the State Ethics Act also 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). Reference is made to the above provision of law, not to imply that there has or will be any implication thereof, but merely to provide a complete response to the question that has been posed. Conclusion: The State Ethics Act presents no absolute prohibitions upon the employment of your adult daughter by a business that is on contract with the City of Philadelphia. It would, however, be the better practice for you as a public employee to refraim from participating in the inspection of any work that has been performed by your adult daughter. Your abstention in such matters should be appropriately recorded in department records. Additionally, your conduct should be guided by the other provisions of the State Ethics Act as noted above. 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. Domenick V. Schiavello May 21, 1987 Page 5 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. Actin General Counsel