Loading...
HomeMy WebLinkAbout18-513 PirringPHONE: 717 -783 -1610 TOLL FREE: 1- 800- 932 -0936 To the Requester: Mr. Jason Pirring Dear Mr. Pirring: ADVICE OF COUNSEL March 9, 2018 FACSIMILE: 717 -787 -0806 WEBSITE: www.ethics.pa.gov 18 -513 This responds to your undated letter postmarked January 22, 2018, received January 24, 2018, by which you requested an advisory from the Pennsylvania State Ethics Commission ( "Commission "). Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65 § 1101 et seq., would impose prohibitions or restrictions upon a township commissioner with- regard to receiving compensation for performing services related to the township's recreational basketball program either as a township employee or in a private capacity. Facts: You request an advisory from the Commission based upon submitted aa' -c the material portion of which may be fairly summarized as follows. You have been a resident of Ross Township ( "Township "), located in Allegheny County, Pennsylvania, for ten years. Since 2015, you have been involved with various programs within the Township's recreational basketball program � "the Township Basketball Program "). You and another individual, Pam Hurt ( "Ms. Hurt'), organize and serve as coaches for a preschool student program and a first and second grade student Efor which you and Ms. Hurt each receive twenty -five percent of the fees paid by the students who sign up for those programs. You and Ms. Hurt also organize and serve as coaches for a seventh through twelfth grade student program, for which you and Ms. Hurt each receive thirty -five percent of the fees paid by the students who sign up for that program. You received compensation totaling $735.00 in 2015, $1,176.00 in 20'16, and 2,'166.34 in 2017 for assisting with the Township Basketball Program. On January 2, 2018, you were sworn into office as a Township Commissioner. Based upon the above submitted facts, the question that is presented is whether the Ethics Act would impose prohibitions or restrictions upon you with regard to receiving compensation for performing services related to the Township Basketball Program while you are a Township Commissioner. As it is unclear from your request P' ' , 18 -513 March 9, 2018 Page 2 letter whether you would perform such services either as a Township employee or in a private capacity, this Advice shall address both possibilities. Discussion; It is initially noted that pursuant to Sections 1107(10) and 1107(l 1) of fhe Et il�i s 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 disclosed all of the material facts. As a Township Commissioner, you are 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. (j) 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 provided herein. In the case of a three- member governing bod of a political subdivision, where one member has ab%ained from voting as a result of a conflict of interest and the remaining wo 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), (j). The following terms related to Section 1103(a) are defined in the Ethics Act as follows: § 1102. Definitions "Conflict" or "conflict of interest." Use by a public official or public employee of the authority of his office or Pirrin , 18 -513 larc�l 9, 2018 Page 3 employment or any confidential information received through his holding public office or employment for the private pecuniary benefit 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 industrryy, 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 duties and responsibilities unique to a particular public office or position of public employment. "De minimis economic impact." An economic consequence which has an insignificant effect. 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 employyee.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 official/public employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. In each instance of a conflict of interest, the public official/public employee would be required to abstain from participation. The abstention requirement would not be limited merely to voting, but would extend 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. Subject to certain statutory exceptions, in each instance of a voting coffin [pct, Section 11030) of the Ethics Act would require the public official /public employee to abstain and to publicly disclose the abstention and reasons for same, both orally and by filing a written memorandum to that effect with the person recording the minutes. A conflict of interest would not exist to the extent the "de minimis exclusion" and/or the "class /subclass exclusion" set forth within the Ethics Act's definition of the term "conflict" or "conflict of interest," 65 Pa.C.S. § 1102, would be applicable. The de minimis exclusion precludes a finding of conflict of interest as to an action having a de minimis (insignificant) economic impact. Thus, when a matter that would otherwise constitute a conflict of interest under the Ethics Act would have an insignificant economic impact, a conflict would not exist and Section 1103(a) of the Ethics Act would not be implicated. See, Kolb, Order 1322; Schweinsburq, Order 900. The Commission has determined the apppTicability of the de minimis exclusion on a case -by -case basis, considering all relevant circumstances. In the past, the Commission has found amounts up to approximately $1,200 to be de minimis. See, Fidler, Order 1637. You are cautioned that the economic impact of an individualrs c-uct may aggregate over time, rather than be limited to a particular increment of time such as a month or year. Confidential Opinion, 05-001, Core , Opinion 13 -006, Mann, Opinion 14 -003. Pirr_i_n , 18 -513 ar 9, 2018 Page 4 In order for the class /subclass exclusion to apply, two criteria must be met: (1) the affected public official /public employee, immediate family member, or business with which the public official /public employee or immediate family member is associated must be a member of a class consisting of the general public or a true subclass consisting of more than one member, and (2) the public official /public employee, immediate family member, or business with which the public official /public employee or immediate family ember is associated must be affected "to the same de ?re" e (in no wayy differently) than the other members of the class /subclass. 65 Pa.C.S. 1102; see, Ka lack Opinion 02 -003; Rubenstein, Opinion 01 -007. The first criterion of the exclusion is satisfied where the members of the proposed subclass are similarly situated as the result of relevant shared characteristics. The second criterion of the exclusion is satisfied where the individual /business in question and the other members of the class /subclass are reasonably affected to the same degree by the proposed action. Kablack, supra. Section 1103(f) of the Ethics Act, pertaining to contracting, provides as follows: § 1103. 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 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. Pirnn q ' 18-513 arc 9, 2018 Page 5 Section 1103(f) does not operate to make contracting with the governmental body permissible where it is otherwise prohibited. Rather, where a public officiallpublic 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 ppublic process" be observed as to the contract with the governmental 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. would be performed for the Township Basketball Program as _ aTownshi With regard to the question of simultaneous service, it is initially noted that the General Assembly has the constitutional power to declare by law which offices are incompatible. Pa. Const. Art. 6, § 2. Although the Commission does not have the express statutory jurisdiction to interpret such other laws, it may review the Ethics Act to determine whether a conflict exists based upon statutory incompatibility. Corcoran, Opinion 08 -003. A conflict of interest exists under the Ethics Act where a pecuniary benefit or financial gain (such as salary, benefits, and the like) is derived as a result of holding incompatible positions simultaneously. See, Corcoran, supra; Confidential Opinion 03- 003. The Commission has determined t iatat �f a particular statutory enactment pro ibits an official from receiving a particular pecuniary benefit or financial gain, then that official's receipt of same, through the authority of public office, is unauthorized in law and hence, contrary to Section T103(a) of the Ethics Act. There do not appear to be any statutory provisions in the First Class Township Code, 53 P.S. § 55I01 et sue,., that expressly authorize a township ommissioner to serve as a township empTyee, and there are legal issues as to whether the First Class Township Code would permit such simultaneous service. See, McCutcheon v. State Ethics Commission, 466 A.2d 283 (Pa. Cmwlth 1983) (Note 9 ; PA-arshall, Order 1508. Therefore. 7-56—First Class Township Code would permit you as a Township Commissioner to simultaneously serve as a Township employee performing services for the Township Basketball Program, the Ethics Act would likewise permit such simultaneous service because there would be no receipt of a private pecuniary benefit that would be unauthorized in law. Conversely, if the First Class Township Code would prohibit the aforesaid simultaneous service, the simultaneous service would likewise be prohibited by Section 1103(a) of the Ethics Act to the extent you would receive compensation in either position. If services would be performed for the Township Basketball Program in a private An agreement or arrangement whereby you would perform services for the Township Basketball Program in a private capacity would constitute a "contract" as that term is defined in the Ethics Act. As long as the restrictions and requirements of the Ethics Act would be observed, the Ethics Act would not prohibit you from contractually performing services for the Township Basketball Program. However, subject to the de minimis exclusion and the class /subclass exclusion, pursuant to Section 1103(a) of the Ethics Act, you would have a conflict of interest in your capacity as a Township Commissioner in matter(s) that Pirrin , 18 -513 March 9, 2018 Page 6 would financially impact you, including but not limited to matter(s) pertaining to actual or anticipated contract(s) between the Township and you. In each instance of a conflict of interest, you would be required to abstain from participation, which would include voting unless one of the statutory exceptions of Section 11030) 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 as to any contract between you and the Township that would be valued at $500 or more. See, Kistler v. State Ethics Commission, 610 Pa. 516, 22 A.3d 223 (2011), regarding the requirements or an open an pu is process. ") It is noted that a problem could exist under the First Class Township Code as to contracting between you and the Township. Section 56811 of the First Class Township Code provides as follows: § 56811. Penalty for personal interest in contracts Except as otherwise provided in this act, no township 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 indirectly, in any contract for the sale or furnishing of any supplies or materials for the use of the township or for any work to be done for such township involving the expenditure by the township of more than three hundred dollars in any year, but this limitation shall not apply to cases where such officer or appointee of the township 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 benefitted thereby, either financially or otherwise. But in the case of a commissioner, if he knows that he is within the exception just mentioned, he shall so inform the commissioners and shall refrain from voting on the expenditure or any ordinance relating thereto and shall in no manner participate therein. Any official or appointee who shall knowingly violate the provisions of this section shall be subject to surcharge to the extent of the damage shown to be thereby sustained by the township, to ouster from office, and shall be guilty of a misdemeanor, and upon conviction thereof, shall be sentenced to pay a fine not exceeding five hundred dollars. 53 P.S. § 56811. Because this Advice may not interpret the above quoted provision of the First Class Township Code, it is suggested that you seek legal advice in that regard. 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. Conclusion; Based upon the submitted facts that: (1) you have been a resident of oss Township ( "Township "), located in Allegheny County, Pennsylvania, for ten Pirrnng, 18 -513 March 9, 2018 Page 7 years; (2) since 2015, you have been involved with various programs within the Townships recreational basketball pro ram ( "the Township Basketball Program "); (3) You and another individual, Pam Hurt ( "Ms. Hurt "), organize and serve as coaches for a preschool student program and a first and second grade student program, for which you and Ms. Hurt each receive twenty -five percent of the fees paid by the students who sign up for those programs; (4) you and Ms. Hurt also organize and serve as coaches for a seventh through twelft h grade student program, for which you and Ms. Hurt each receive thirty -five percent of the fees paid by the students who sign up for that program; (5) you received compensation totaling $735.00 in 2015, $1,176.00 in 2016, and $2,166.34 in 2017 for assisting with the Township Basketball Program; and (6) on January 2, 2018, you were sworn into office as a Township Commissioner, you are advised as follows. As a Township Commissioner, you are a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq. If services would be performed for the Township Basketball Program through simultaneous service as a Township em o ee: There do not appear to be any statutory provisions in the First Class Township Code, 53 P.S. § 55101 et seq., that expressly authorize a township commissioner to serve as a township employee, and there are legal issues as to whether the First Class Township Code would permit such simultaneous service. Therefore, if the First Class Township Code would permit you as a Township Commissioner to simultaneously serve as a Township employee performing services for the Township Basketball Program, the Ethics Act would likewise permit such simultaneous service because there would be no receipt of a private pecuniary benefit that would be unauthorized in law. Conversely, if the First Class Township Code would prohibit the aforesaid simultaneous service, the simultaneous service would likewise be prohibited by Section 1103(a) of the Ethics Act to the extent you would receive compensation in either position. for the T An agreement or arrangement whereby you would perform services for the Township Basketball Program in a private capacity would constitute a "contract" as that term is defined in the Ethics Act. As long as the restrictions and requirements of the Ethics Act would be observed, the Ethics Act would not prohibit you from contractually performing services for the Township Basketball Program. However, subject to the de minimis exclusion and the class /subclass exclusion, pursuant to Section 1103(a) of the Ethics Act, you would have a conflict of interest in your capacity as a Township Commissioner in matter(s) that would financially impact you, including but not limited to matter(s) pertaining to actual or anticipated contract(s) between the Township and you. In each instance of a conflict of interest, you would be required to abstain from participation, which would include voting unless one of the statutory exceptions of Section 11030) 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 as to any contract between you and the Township that would be valued at $500 or more. It is noted that a problem could exist under the First Class Township Code as to contracting between you and the Township, and therefore, it is suggested that you seek legal advice in that regard. P rrin , 18 -513 arc 9, 2018 Page 8 Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. 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 any reason to challenge same, you may appeal the Advice to the full 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 writingg and must be actual! received at the Commission within thirty (30) days of the date Advice pursuant to 51 Pa. Code § 93.2(h). The appeal may be received at the Commission by hand delivery, United States mail, delivery service, or by FAX transmission (717-787-0806). Failure to file such an appeal at the Commission within thirty (30) days may result in the dismissal of the appeal. 4nc y,, t V Robin M. Hittie Chief Counsel