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HomeMy WebLinkAbout88-608 HaluskaHornorable Edward J. Haluska State Representative House of Representatives Commonwealth of Pennsylvania P.O. Box 112 Main Capitol Building Harrisburg, PA 17120 -0028 STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL July 12, 1988 88 -608 Re: Conflict of Interest, State Representative, Leasing Space to Pennsylvania Liquor Control Board Dear Representative Haluska: This responds to your letter of June 10, 1988, in which you requested advice from the State Ethics Commission. Issue: You ask whether the State Ethics Act presents any restrictions or prohibition upon a state representative from leasing space to the Pennsylvania Liquor Control Board. Facts: You state that you have been requested by General Services to get a written opinion from the State Ethics Commission concerning your lease of a store room to the Pennsylvania Liquor Control Board, hereinafter LCB. You then advise that when you first ran for public office eight years ago you made an inquiry of the LCB as to the status of your lease with them and was advised that since you had been renting for a number of years prior to your election, the existence of that lease would have no bearing upon your newly elected status. You then state that for some unknown reason General Services now questions the validity of such contracts and because of that you request advice as to whether the rental of space (Patton Drug Building) located at 463 Magee Avenue in Patton, might impact upon the State Ethics Act. Discussion: As the representative for the 73rd legislative district, you are a public official within the definition of that term as set forth in the Ethics Act and the regulations of this Representative Edward J. Haluska July 12, 1988 Page 2 Commission. 6 subject to the 5 P.S. §402; 51 Pa. Code §1.1. As such, you are provisions of the Ethics Act. 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). Section 3(a) basically provides that a public official or employee 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 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, Pa. Commw. , 531 A.2d 536 (1987). Thus, under this provision, a public official may not use his public position to secure benefits for himself or a member of his immediate family which are not provided for by law. Domalakes, Opinion 85 -010; likewise, the receipt of private financial gain. or benefit through use of office is not permitted under this section, Huff, Opinion 84 -015. Section 3(b) of the Ethics Act provides: (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 Representative Edward J. Haluska July 12, 1988 Page 3 the vote, official action, or judgment of the public employee or candidate for public office would be influenced thereby. 65 P.S. 403(b). Section 3(b) of the Ethics Act must be referenced in order to provide a complete response to your inquiry. Under Section 3(b) of the Ethics Act cited above, which a public official or employee must observe, a public official or employee must neither offer nor accept anything of value on the understanding or with the intention that his judgment would be influenced thereby. It is assumed such a situation does not exist here. This Section is referenced 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. In addition to the foregoing, the State Ethics Act provides as follows: Section 3(c) of the Ethics Act provides.: (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, Opinion 80 -014; Lynch, Opinion 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 Representative Edward J. Haluska July 12, 1988 Page 4 by law. For example, if a particular business transaction were prohibited under Section 3(a) of the State Ethics Act, then Section 3(c) would not allow that contract. Parenthetically, where contracting is otherwise allowed or where there appears to be no expressed prohibitions to such contracting, the above particular provision of law would require that an additional procedure, the open and public process, must be used in all situations where a public official is otherwise appropriately contracting with his own governmental body in excess of $500. This open and public process would require: (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, 82 -004. Under the above quoted provisions, Section 3(a) of the Ethics Act would not preclude your from leasing the office space to the LCB. See Goodman, Opinion 88 -001. It is assumed for purposes of this advice that have not used public office or confidential information to obtain the lease; in this regard, you have stated that you were leasing the space to the LCB prior to your election. Additionally, any matters relating to your lease of the office space with LCB, whether that would involve negotiating the terms of the lease, entering into the lease or resolving any problems that might arise during the term of the lease, could not be handled through your legislative office nor could any of the staff, equipment, or supplies of your legislative office be used relative to the foregoing. See, Dorrance, Order 456. As to Section 3(c) of the Ethics Act, the provisions of that Section would not appear to be applicable in this situation since the LCB is not your "governmental body" as that term is defined under the Ethics - Act. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act; the applicability of any other statute, code, ordinance, regulation or other code of conduct other than the Ethics Act has not been considered in that they do not involve an interpretation of the Ethics Act. Specifically Representative Edward J. Haluska July 12, 1988 Page 5 not addressed in this advice is the applicability of the Legislative Code of Ethics or the State Adverse Interest Act in that they do not involve an interpretation of the State Ethics Act. Conclusion: As a Representative of the 73rd Legislative District, you are a public official subject to the provisions of the State Ethics Act. Subject to the limitations as outlined above, you may, consistent with the Ethics Act, lease rental space to the LCB. 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. 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. Sincerely, Vincent , Dopko, General Counsel