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HomeMy WebLinkAbout88-514 UrickRichard Urick, Esquire 23rd and Davidson Streets Aliquippa, PA 15001 Dear Mr. Urick: STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PA 17120 TELEPHONE: (717) 783 -1610 February 17, 1988 ADVICE OF COUNSEL Section 3(a) of the Ethics Act provides: 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). 88 -514 Re: Simultaneous Service, Borough Councilmember, Borough Crossing Guard, Contracting with the Borough Council This responds to your letter of January 14, 1988, in which you requested advice from the State Ethics Commission. Issue: Whether the State Ethics Act imposes any prohibition or restriction upon a borough councilmember from also serving as a crossing guard or from contracting with borough council. Facts: You state that you are the solicitor for Monaca Borough, Beaver County, wherein an individual who has been employed as a crossing guard for the borough has now been elected as a councilmember and wherein an individual who operated a private business which sold goods to the borough has also been elected as a borough councilmember. You state that you have found no prohibiton against either of these activities in the Borough Code. You conclude by requesting advice as to whether a councilmember can simultaneously serve as a crossing guard, as to whether that councilmember could vote on the borough's annual proposed budget and lastly, as to whether a councilmember could sell from his private business, goods, items and supplies to the borough in situations where public bidding is or is not required. Discussion: As a councilmember for Monaca Borough, the individual is a "public official" as that term is defined in the Ethics Act. See Rider, 490 -R; 65 P.S. §402; 51 Pa. Code §1.1. As such, his conduct is subject to the provisions of the Ethics Act and the restrictions therein are applicable to him. Richard Urick, Esquire February 17, 1988 Page 2 Section 3(a) basically provides that a public official may not use his public office or confidential information to obtain a financial gain other than compensation as provided for by law for himself or a member of his immediate family or a business with which he is associated. Under this provision, the Ethics Commission has determined that the use of office by a public official to obtain a gain or benefit for himself or a member of his immediate family or a business with which he is associated which is not provided for in law constitutes a "financial gain other than compensation provided for by law." These determinations have been appealed to the Commonwealth Court of Pennsylvania which has affirmed the Orders of the Commission. See McCutcheon v. State Ethics Commission, 77 Pa. Commw. 529 (1983). See also Yocabet v. State Ethics Commission, A.2d 536 (1987). Thus, under this provision, a public official maay�not use his public position to secure any financial gain for himself or a member of his immediate family or a business with which he is associated unless it is provided for by law. Domalakes Opinion, 85 -010. However, as outlined above, there does not appear to be a real possibility of any financial gain or inherent conflict arising if the councilmember were to serve both as a public official and as crossing guard. Basically, the Ethics Act does not state that it is inherently incompatible for a public official to serve or be employed as a crossing guard. The main prohibition under the Ethics Act and Opinions of the Ethics Commission is that one may not serve the interests of two persons, groups, or entities whose interests may be adverse. See Alfano Opinion, 80 -007. In the outlined above, the councilmember would not be serving entities �with 7 interests which are adverse to each other. A subsidiary question must now be addressed as to whether a councilmember may receive compensation for serving as a borough crossing guard. As to whether the Ethics Act would restrict or prohibit a borough councilmember from receiving compensation while serving as a crossing guard, it is noted that the State Ethics Commission may only address questions regarding the duties and responsibilities of public officials within the purview of the State Ethics Act. The Commission does not specifically have the statutory jurisdiction to interpret the provisions of the Borough Code. If, however, another provision of law somehow impacts on the provisions of the State Ethics Act or the Ethics Act accords jurisdiction in relation to other provisions of law, then this Commission may be required to interpret such provisions of law. See Bigler Opinion, 85 -020. Section 1104 of the Borough Code provides in part: "Unless there is incompatibility in fact, any elective or appointive officer of the borough shall be eligible to serve on any board, commission, bureau or other agency created by or for the borough, or any borough office Richard Urick, Esquire February 17, 1988 Page 3 created or authorized by statute and may accept appointments thereunder, but no mayor or councilman shall receive compensation therefor." 53 P.S. §46104. Section 1104 of the Borough Code thus precludes a councilmember from receiving compensation for service on any board, commission, bureau or agency created by the borough. Therefore, although the councilmember could serve as borough crossing guard, he may not under Sectin 3(a) of the Ethics Act receive compensation for that position. See Muolo Advice, 87 -657. Thus, the State Ethics Commission determined in Shugarts Order, No. 623, that a borough councilmember violated Section 3(a) of the Ethics Act when he performed snow plowing services for the borough and received payment therein; the Commission reached its decision by noting that there was no statutory authorization in the Borough Code for a councilmember to receive payment for such employment, apart from the salary that he was entitled to as a councilmember. Section 3(b) of the Ethics Act provides: 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). Under Section 3(b) of the Ethics Act cited above, which must be observed, one must neither offer nor accept anything of value on the understanding or with the intention that his official judgment would be influenced thereby. It is assumed such a situation does not exist here. Reference to this Section is added not to indicate that any such activity has been or will be undertaken but in an effort to provide a complete response to your inquiry. Section 3(d) of the Ethics Act provides: Section 3. Restricted activities. (d) Other areas of possible conflict shall be addressed by the commission pursuant to paragraph (9) of section 7. 65 P.S. 403(d). Richard Urick, Esquire February 17, 1988 Page 4 Under Section 3(d) of the Ethics Act, the Commission has applied this section, in part, by referencing the preamble of the Ethics Act, the purpose of which is to strengthen the faith and confidence of people in their government by assuring the public that the financial interests of the holders of or candidates for public office present neither a conflict nor the appearance of a conflict with the public trust. See Section 1 of the Ethics Act, 65 P.S. 401. Under this provision, as well as Section 3(a), councilmember could not participate on any matter wherein he would t have o a ough direct or indirect interest. Wel z inion, 86 -001. However, in this case, it would seem that if the councilmember chooses to serve as a crossing guard in a non - compensated position, he would not have any direct or indirect interest in the budget and hence could participate in its preparation. Further, under the above circumstances, it appears he would not be precluded from voting in favor of its adoption, Krier Opinion, 84 -003. As to the matter of whether a borough councilmember may sell goods, items or supplies to the borough, Section 3(c) of the Ethics Act provides: 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 relation to the above provision of law, the State Ethics Commission has generally determined that this provision is a procedure to be used when a public official or employee contracts with his own governmental body in excess of $500. Bryan, 80 -014; Lynch, 79 -047. The Commission, however, has also determined that the above provision of law is not a general authorization for a public official to contract with his own governmental body where such is otherwise prohibited by law. The above provision of law clearly is intended to be a procedure to be utilized where contracting is otherwise allowed by law. For example, if a particular business transaction was prohibited under Section 3(a) of the State Ethics Act, this particular provision of law would not authorize that transaction. Additionally, if a particular code prohibits a public official from being interested in a contract, this provision would not allow that interest. Richard Urick, Esquire February 17, 1988 Page 5 The Borough Code further provides: PENALTY FOR PERSONAL INTEREST IN CONTRACTS OR PURCHASES. Except as otherwise provided in this act, no borough official either elected or appointed, who knows or who by the exercise of reasonable diligence could know, shall be interested to any appreciable degree either directly or i ndi rectly in any purchase made or contract entered into or expenditure of money made by the borough or relating to the business of the borough, involving the expenditure by the borough of more than one thousand ($1,000) in any calendar year, but this limitation shall not apply to cases where such officer or appointee of the borough is an employe of the person, firm or corporation to which the money is to be paid in a capacity with no possible influence on the transaction, and in which he cannot be possibly benefited thereby either financially or otherwise. 53 P.S. §46404. The above provision of law clearly indicates that an elected or appointed official of a borough may not be interested either directly or indirectly i n any borough expenditure in excess of $1,000 in a single calendar year. If the above provision of law would prohibit, based upon the facts of this situation, a borough official from receiving that type of compensation or benefit, then within the Ethics Act, an official who receives a financial gain knowingly in violation of that provision of the Code may also be receiving a financial gain other than the compensation provided for by law which would not be in accord with the State Ethics Act. Thus, it is advised that this provision of the Borough Code must be considered if the borough councilmember, in question, submits his bids to the borough. See Allen Advice, 86-1; Fountaine 86 -5 22; Kalinyak Advice, 86 -535. In t instant sit no information he has been provided relating to how much money will be expended by the borough in each year. As such, it cannot be determined if the anticipated activity would be in violation of Section 3(a). The provisions of the Borough Code, however, must be considered as noted above. Parenthetically, where contracting is otherwise allowed or where there appears to be no expressed prohibition to such contracting, the above particular provision of the Ethics Act would require that an additional procedure be utilized when such business is transacted. This procedure, the open and public process, must be used in all situations were a public official is otherwise appropriately contracting with his own governmental body in excess of $500. This open and public process would require: Richard Urick, Esquire February 17, 1988 Page 6 (1) prior public notice of the employment or contracting possibility; (2) sufficient time for a reasonable and prudent competitor /applicant to be able to prepare and present an application or proposal; (3) public disclosure of all applications or proposals considered and; (4) public disclosure of the contract awarded and offered and accepted. See, Cantor Opinion, 82 -004. Thus, in the event that contracting would be allowed, the above process must be employed. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Conclusion: As a councilmember for Monaca Borough, the individuals are "public officials" subject to the provisions of the Ethics Act. Although Section 3(a) of the Ethics Act presents no per se prohibition upon a borough councilmember simultaneously serving as a crossing guard, the councilmember may not receive compensation for serving as a crossing guard. Under Sections 3(a) and 3(d) of the Ethics Act, the borough councilmember could participate in budget deliberations, provided he had no personal interest in any budgetary items, and could vote to ratify or approve the budget. As to a councilmember selling good items or supplies to the borough, within Section 3(c) of the State Ethics Act, any contract in this respect must be awarded through an open and public process and the borough councilmember must abstain from all participation in said matter. In addition, Section 3(a) of the State Ethics Act would prohibit an official from knowingly receiving any financial gain or compensation to which he is not entitled. As such, the Borough Code must be consulted in order to determine if, in fact, this individual would be receiving any financial gain in the instant situation to which he was not entitled. In the event that the Code does place such a prohibition upon the borough councilmember, then his receipt of compensation, to which he is not entitled, may be a violation of Section 3(a) of the State Ethics Act. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. 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. Richard Urick, Esquire February 17, 1988 Page 7 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 w i l l be issued. Any such appeal must be Trade, in writing, to the Commission within 15 days of service of this Advice pursuant to 51 Pa. Code 2.12. S'ncerely, Vincent Dopko ko General Counsel