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HomeMy WebLinkAbout18-501 WileyPHONE: 717- 783 -1610 TOLL FREE: 1- 800 -932 -0936 rt it STATE ETHICS COMMISSION FINANCE. BUILDING 613 NORTH STREET, ROOM 309 HARRISBURG, PA 17120 -0400 ADVICE OF COUNSEL January 22, 2018 To the Requester: J. Michael Wiley, Esquire McCormick Law Firm Dear Mr. Wiley: FACSIMILE: 717- 787 -0806 WEBSITE: www.ethics.pa.gov 18 -501 This responds to your letter dated November 29, 2017, by which you requested an advisory from the Pennsylvania State Ethics Commission ( "Commission "). Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 55 P—a-.CS. §'1101 et se g., would impose prohibitions or restrictions upon an individual serving as a school director, who in a rivate capacity is employed as a nurse with a corporation that has a contract to provide substitute school nurses to the school district, with regard to accepting assignments from the corporation to serve as a substitute school nurse for the school district. Facts: As Solicitor for the Selinsgrove Area School District ( "School District "), owed in Snyder County, Pennsylvania, you have been authorized by Amelia Stauffer "Ms. Stauffer "), who is a School Director for the School District, to request an advisory rom the Commission on her behalf. You have submitted facts that may be fairly summarized as follows. A corporation named "BAYADA Home Health Care, Inc." (the "Corporation ") has a contract (the "Contract ") with the School District for the provision of substitute school nurses. The Contract is effective from August 29, 2017, through June 1, 2018, and the parties have the right to extend the term of the Contract. Pursuant to the Contract, the Corporation provides the School District with an RN or LPN to serve as a substitute school nurse. The Corporation is compensated on an hourly basis for the substitute services provided under the Contract. In November 2017, Ms. Stauffer was elected as a School Director for the School District for a term of office beginning on December 4, 2017. In a private capacity, Ms. Stauffer is employed as a nurse with the Corporation. Before Ms. Stauffer was elected as a School Director, she was occasionally assigned by the Corporation to serve as a substitute school nurse for the School District, Ms. Stauffer was compensated through the Corporation for providing the aforesaid substitute services to the School District. Wile , 18 -501 January 22, 2018 Page 2 Based upon the above submitted facts, you ask whether the Ethics Act would impose prohibitions or restrictions upon Ms. Stauffer with regard to accepting assignments from the Corporation to serve as a substitute school nurse for the School District. Discussion: It is initially noted that pursuant to Sections 1107(10) and 1107(11) of the Ethics Act, 65 Pa.C.S. §§ 1107(10), (11), advisories are issued to the requester based upon the facts that the requester has submitted. In issuing the advisory based upon the facts that the requester has submitted, the Commission does not engage in an independent investigation of the facts, nor does it speculate as to facts that have not been submitted. It is the burden of the requester to truthfully disclose all of the material facts relevant to the inquiry. 65 Pa.C.S. §§ 1107(10 }, (11). An advisory only affords a defense to the extent the requester has truthfully discllosed all of the material facts. As a School Director for the School District, Ms. Stauffer is a public official subject to the provisions of the Ethics Act. Sections 1103(a) and 11030) of the Ethics Act provide: § 1103. Restricted activities (a) Conflict of interest. - -No public official or public employee shall engage in conduct that constitutes a conflict of interest. 0) Voting conflict.- -Where voting conflicts are not otherwise addressed by the Constitution of Pennsylvania or by any law, rule, regulation, order or ordinance, the following procedure shall be employed. Any public official or public employee who in the discharge of his official duties would be required to vote on a matter that would result in a conflict of interest shall abstain from voting and, prior to the vote being taken, publicly announce and disclose the nature of his interest as a public record in a written memorandum filed with the person responsible for recording the minutes of the meeting at which the vote is taken, provided that whenever a governing body would be unable to take any action on a matter before it because the number of members of the body required to abstain from voting under the provisions of this section makes the majority or other legally required vote of approval unattainable, then such members shall be permitted to vote if disclosures are made as otherwise pprovided herein. In the case of a three - member governing body of a political subdivision, where one member has abstained from voting as a result of a conflict of interest and the remaining two members of the governing body have cast opposing votes, the member who has abstained shall be permitted to vote to break the tie vote if disclosure is made as otherwise provided herein. 65 Pa.C.S. §§ 1103(a), 6). The following terms related to Section 1103(a) are defined in the Ethics Act as follows: § 1102. Definitions Wiley, 18-501 January 22, 2018 Page 3 "Conflict"" or "conflict of interest." Use by a public official or public employyee of the authority of his office or employment or any confidential information received through his holding public office or employment for the private pecuniary enefit of himself, a member of his immediate family or a business with which he or a member of his immediate family is associated. The term does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. "Authority of office or employment." The actual power provided by law, the exercise of which is necessary to the performance of dunes and responsibilities unique to a particular public office or position of public employment. "Business." An corporation, partnership, sole proprietorship, firm, enterprise, franchise, association, organization, self - employed individual, holding compan , joint stock company, receivership, trust or any legal entity organized for profit. "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 has a financial interest. 65 Pa.C.S. § 1102. Subject to the statutory exclusions to the Ethics Act's definition of the term "conflict" or "conflict of interest," 65 Pa.C.S. § 1102, a public official/public employee is prohibited from using the authority of public officelemployment or confidential information received by holding such a public position for the private pecuniary benefit of the public officiallpublic employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. The use of authority of office is not limited merely to voting, but extends to any use of authority of office including, but not limited to, discussing, conferring with others, and lobbying for a particular result. Juliante, Order 809. In each instance of a conflict of interest, a public official/public employee would be required to abstain from participation, which would include voting unless one of the statutory exceptions of Section 11036) of the Ethics Act would be applicable. Additionally, the disclosure requirements of Section 11030) of the Ethics Act would have to be satisfied in the event of a voting conflict. Section 1103(f) of the Ethics Act, pertaining to contracting, provides as follows: § 11 03. Restricted activities (f) Contract. - -No public official or public employee or his spouse or child or any business in which the person or his spouse or child is associated shall enter into any contract wile , 18 -501 January 22, 2018 Page 4 valued at $500 or more with the governmental body with which the public official or public employee is associated or any subcontract valued at $500 or more with any person who has been awarded a contract with the governmental body with which the public official or public employee is associated, 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. In such a case, the public official or public employee shall not have any supervisory or overall responsibility for the implementation or administration of the contract. Any contract or subcontract made in violation of this subsection shall be voidable by a court of competent jurisdiction if the suit is commenced within 90 days of the making of the contract or subcontract. 65 Pa.C.S. § 1103(f). The term "contract" is defined in the Ethics Act as follows: § 1102. Definitions "Contract." An agreement or arrangement for the acquisition, use or disposal by the Commonwealth or a political subdivision of consulting or other services or of supplies, materials, equipment, land or other personal or real property. The term shall not mean an agreement or arrangement between the State or political subdivision as one party and a public official or public employee as the other party, concerning his expense, reimbursement, salary, wage, retirement or other benefit, tenure or other matters in consideration of his current public employment with the Commonwealth or a political subdivision. 65 Pa.C.S. § 1102. Section 1103(f) does not operate to make contracting with the governmental body permissible where it is otherwise prohibited. Rather, where a public official /public employee, his spouse or .child, or a business with which he, his spouse or child is associated, is otherwise appropriately contracting with the governmental body, or subcontracting with any person who has been awarded a contract with the governmental body, in an amount of $500.00 or more, Section 1103(f) requires that an open and public process" be observed as to the contract with the Qovernmental body. Section 1103(f) of the Ethics Act also provides that the public official /public employee may not have any supervisory or overall responsibility as to the implementation or administration of the contract with the governmental body. It is administratively noted that the Public School Code provides in part: § 3 -324, Not to be employed by or do business with district; exceptions (a) No school director shall, during the term for which he was elected or appointed, as a private person engaged in any business transaction with the school district in which he is elected or appointed, be employed in any capacity by the school district in which he is elected or appointed, or receive Wile , 18 -501 January 22, 2018 Page 5 from such school district any pay for services rendered to the district except as provided in this act... (c) It shall not be a violation of this section for a school district to contract for the purchase of goods or services from a business with which a school director is associated to the extent permitted by and in compliance with 65 Pa.C.S. Ch. 11 (relating to ethics standards and financial disclosure). 24 P.S. § 3-324(a), (c). On its face, Section 3- 324(c) of the Public School Code permits contracting between school districts and businesses with which school directors are associated as long as the requirements of the Ethics Act are observed. In applying the above provisions of the Ethics Act to the instant matter, you are advised as follows. The Corporation is a business with which Ms. Stauffer is associated in her capacity as an employee. Subject to the statutory exclusions to the definition of "conflict" or "conflict of interest" as set forth in Section 1102 of the Ethics Act, 65 Pa.C.S. § 1102, pursuant to Section 1103(a) of the Ethics Act, Ms. Stauffer would have a conflict of interest as a School Director in matters that would financially impact her or the Corporation. Section 1103(x) of the Ethics Act would not prohibit Ms. Stauffer, in her private capacity as an employee of the Corporation, from accepting assignments from the Corporation to serve as a substitute school nurse for the School District while serving as a School Director for the School District. However, in her public capacity as a School Director, Ms. Stauffer generally would have a conflict of interest under Section 1103(a) of the Ethics Act with regard to matter(s) pertaining to the Corporation or the Contract, including but not limited to overseeing work performed b the Corporation relative to the Contract or participating in matter(s) involving extension (ys) /renewal(s) of the Contract or future contract(s) between the School District and the Corporation. In addition, Ms. Stauffer enerally would have a conflict of interest with regard to voting to approve payments) to the Corporation. In each instance of a conflict of interest, Ms. Stauffer would be required to abstain from participation, which would include voting unless one of the statutory exceptions of Section 1103 0) of the Ethics Act would be applicable. Additionally, the disclosure requirements of Section 11030) of the Ethics Act would have to be satisfied in the event of a voting conflict. The restrictions and requirements of Section 1103(f) of the Ethics Act would have to be observed whenever applicable. Section 1103(f) would not be applicable to the Contract given that the Contract was not entered into at a time when Ms. Stauffer was serving as a School Director. Cf., Lind, Advice 16 -547; Shearer, Advice 15 -539; Confidential Advice, 14 -514; Lew Advice 13 -587. However, any extension(s) /renewal(s) of the Contract or future contract(s) between the School District and the Corporation valued at $500.00 or more would be subject to the restrictions and requirements of Section 1103(f) of the Ethics Act to the extent that: (1) Ms. Stauffer would be a School District School Director; and (2) the Corporation would remain a business with which Ms. Stauffer is associated. 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. Wk y, 18 -501 anuary 22, 2018 Page 6 Conclusion: As a School Director for the Selinsgrove Area School District c o0 I Nstrict"), located in Snyder County, Pennsylvania, Amanda Stauffer ( "Ms. tauffer ") is a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act ") 65 Pa.C.S. §§ 1101 et seq. Based upon the submitted facts that: (1) a corporation named "BAYADA Home Health Care, Inc." (the " Corporation") has a contract (the Contract, ) with the School District for the provision of substitute school nurses; (2) the Contract is effective from August 29, 2017, through ,tune 1, 2018, and the parties have the right to extend the term of the Contract; (3) pursuant to the Contract, the Corporation provides the School District with an RN or LPN to serve as a substitute school nurse; (4) the Corporation is compensated on an hourly basis for the substitute services provided under the Contract; (5) in November 2017, Ms. Stauffer was elected as a School Director for the School District for a term of office beginning on December 4, 2017; (6) in a private capacity, Ms. Stauffer is employed as a' nurse with the Corporation; (7) before Ms. Stauffer was elected as a School Director, she was occasionally assigned by the Corporation to serve as a substitute school nurse for the School District; and (8) Ms. Stauffer was compensated through the Corporation for providing the aforesaid substitute services to the School District, you are advised as follows. The Corporation is a business with which Ms. Stauffer is associated in her capacity, as an employee. Subject to the statutory exclusions to the definition of "conflict" or "conflict of interest" as set forth in Section 1102 of the Ethics Act, 65 Pa.C.S. § 1102, pursuant to Section 1103(a) of the Ethics Act, Ms. Stauffer would have a conflict of interest as a School Director in matters that would financially impact her or the Corporation. Section 1103(x) of the Ethics Act would not prohibit Ms. Stauffer, in her private capacity as an employee of the Corporation, from accepting assignments from the Corporation to serve as a substitute school nurse for the School District while serving as a School Director for the School District. However, in her public capacity as a School Director, Ms. Stauffer generally would have a conflict of interest under Section 1103(a) of the Ethics Act with regard to matter(s) pertaining to the Corporation or the Contract, including but not limited to overseeing work performed b the Corporation relative to the Contract or participating in matter(s) involving extension (s)Irenewal(s) of the Contract or future contract(s) between the School District and the CCorporation. In addition, Ms. Stauffer enerally would have a conflict of interest with regard to voting to approve payments) to the Corporation. In each instance of a conflict of interest, Ms. Stauffer would be required to abstain from participation, (which would include voting unless one of the statutory disclosure refquirrementslof3 e tion 110t30)sof the Ethics s A tpwlouid lhavetolbensaltisfied in the event of a voting conflict. The restrictions and requirements of Section 1103(f) of the Ethics Act would have to be observed whenever applicable. Section 1103(f) would not be applicable to the Contract given that the Contract was not entered into at a time when Ms. Stauffer was serving as a School Director. However, any extension(s)/renewal(s) of the Contract or future contract(s) between the School District and the Corporation valued at $500.00 or more would be subject to the restrictions and requirements of Section 1103(f� of the Ethics Act to the extent that: (1) Ms. Stauffer would be a School District School Director; and (2) the Corporation would remain a business with which Ms. Stauffer is associated. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Wiley, 18 -501 ,lanuary 22, 2018 Page 7 Pursuant to Section 1107(11) of the Ethics Act, an 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, provided the requester 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 an yy reason to challenge same, you may appeal the Advice to the fu11 Commission. A personal appearance before the Commission will be scheduled and a formal Opinion will be issued by the Commission. Any such appeal must be in writing and must be actually received at the Commission within thirty (30) days of the date o t ►s vice pursuant to 51 Pa. Code § ?3.2(h). The appeal may b received at the Commission by hand delivery, United States mail, delivery service, or by FAX transmission (717 -787. 0806). Failure to Me such an appeal at the Commission within thirty (30) days may result in the dismissal of the appeal. Since, ly, Robin M. Hittie Chief Counsel