HomeMy WebLinkAbout18-550 MansmannPHONE: 717 -783 -1610
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ADVICE OF COUNSEL
August 7, 2018
To the Requester:
Ms. Joni Mansmann
Dear Ms. Mansmann:
FACSIMILE: 717 -787 -0806
WESSITE: www.ethics.pa.gov
18 -550
This responds to your letter dated July 23, 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
S. § 1101 et seq., would impose prohibitions or restrictions upon an individual
employed as the director of business and finance for a school district, who Is also the
secretary of the school district school board, with regard to soliciting three business
owners to sponsor a hockey team that is part of an amateur hockey program operated
by a non -profit 501(c)(3) corporation for students in the school district, where: (1) the
individual has a son who will be a player on the hockey team for the 2018 -2019 hockey
season; (2) the expenses incurred by the individual in association with her son playing
on the hockey team will include an assessment fee for the 2018 -2019 hockey season;
(3) for each sponsor obtained, a credit would be applied to her son's assessment fee;
(4) two of the three businesses have contracts with the school district, and the individual
has personal relationships unrelated to school district business with the owners of these
two businesses; and (5) the owner of the third business previously served as a school
director for the school district.
Facts: You request an advisory from the Commission based upon submitted
facts hat may be fairly summarized as follows.
You have been employed as the Director of Business and Finance for the
Canon - McMillan School District ( "School District ") since 2007. You are also the
Secretary of the School District School Board.
You have two children who attend schools in the School District. You state that
although obtaining corporate sponsorships is a key fundraising effort for many of your
children's extracurricular activities, you typically have not participated in these efforts.
The Canon - McMillan Hockey Association (the "Hockey Association ") is a non-
profit 501(c)(3) corporation that operates an amateur hockey program for School District
students in grades six through twelve. The Hockey Association has two Middle School
teams, two Junior Varsity teams, and one AAA Varsity team. The expenses associated
with playing on a Hockey Association team include costs for the player's registration
and equipment as well as an assessment fee for the current season (the "Assessment
Mansmann, 18 -550
August 7, 2018
Page 2
Fee "). The Hockey Association receives no funding or financial support of any kind
from the School District, and all operating expenses are paid from income generated
from Assessment Fees, various fundraising events, and charitable contributions from
local businesses.
The Hockey Association has a sponsorship pro ram the "Sponsorship
Program ") that offers businesses the opportunity to sponsor Kockey Association teams.
You have submitted various materials in support of your advisory request, including
copies of a letter and an email from the Hockey Association containing information
regarding the Sponsorship Program.
A sponsor of a Hockey Association team is provided with opportunities for
advertising or recognition in return for a tax - deductible donation. There are four levels
of sponsorships available for donations ranging from $250.00 to $2,500.00. A credit will
be applied to a player's Assessment Fee for each sponsor obtained by the player.
Depending upon the level of sponsorship chosen by a sponsor, a player will get a credit
in the amount of $75.00, $150.00, $300.00, or $750.00 applied to the player's
Assessment Fee.
You have a son who will be a player on one of the Hockey Association's Middle
School teams (the "Hockey Team ") for the 2018 -2019 hockey season. You would like
to solicit the owners of three businesses to sponsor the Hockey Team. Two businesses
that you utilize in a private capacity ---an auditor ( "Business 1" and an insurance broker
( "Business 2 ") —have long - standing contracts with the School District which are not up
for renewal at this time. You have personal relationships with the owners of Business 1
and Business 2 that existed prior to your employment with the School District and are
unrelated to School District business. The third business ( "Business 3 ") is owned by an
individual who previously served as a School Director for the School District.
Based upon the above submitted facts, you ask whether the Ethics Act would
impose prohibitions or restrictions upon you with regard to soliciting the owners of
Business 1, Business 2, and Business 3 to sponsor the Hockey Team.
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 disclosed all of the material facts.
Preliminarily, it is noted that the submitted facts do not include an official job
description for your position as the Director of Business and Finance for the School
District. This Advice assumes, without deciding, that in your capacity as the Director of
Business and Finance for the School District, you are a public employee subject to the
provisions of the Ethics Act. In your capacity as the Secretary of the School District
School Board, you are a public official subject to the provisions of the Ethics Act.
Section 1103(a) of the Ethics Act provides:
§ 1103. Restricted activities
(a) Conflict of interest. - -No public official or public
employee shall engage in conduct that constitutes a conflict
of interest.
65 Pa.C.S. § 1103(a).
Mansmann, 18550
August 7, 2 018
Page 3
The following terms related to Section 1103(a) are defined in the Ethics Act as
follows:
§ 9102. Definitions
"Conflict" or "conflict of interest." Use by a public
official or public employee of the authority of his office or
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 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
he performance of duties and responsibilities unique to a
particular public office or position of public employment.
"Business." Any corporation, partnership, sole
proprietorship, firm, enterprise, franchise, association,
organization, self - employed individual, holding company,
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.
"Financial interest." Any financial interest in a legal
entity engaged in business for profit which comprises more
than 5% of the equity of the business or more than 5% of the
assets of the economic interest in indebtedness.
"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 employee is
prohibited from using the authority of public office /employment 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 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.
Mansmann, 18 -550
August 7, 2018
Page 4
Per the Pennsylvania Supreme Court's decision in Kistler v. State Ethics
Commission, 610 Pa. 516, 22 A.3d 223 (2011), in order to violate Section 11 03(a) of the
Ethics ct, a public official/public employee:
... must act in such a way as to put his office /public position]
to the purpose of obtaining for himself a private pecuniary
benefit. Such directed action implies awareness on the part
of the [public official/public employee] of the potential
pecuniary benefit as well as the motivation to obtain that
benefit for himself.
Kistler, supra, 610 Pa. at 523, 22 A.3d at 227. To violate Section 1103(a) of the Ethics
Act, a public official/public employee "must be consciously aware of a private pecuniary
benefit for himself, his family, or his business, and then must take action in the form of
one or more specific steps to attain that benefit." Id., 610 Pa. at 528, 22 A.3d at 231.
One of the exclusions to the statutory definition of "conflict" or "conflict of
interest," referred to herein as 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;
Schweinsbur , Order 900. The Commission has determined -tine app icability 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
individual's conduct may aggregate over time, rather than be limited to a particular
increment of time such as a month or year. Confidential Opinion, 05 -001; Corey/Mann,
Opinion 13 -006; Corey/Mann, Opinion 14 -003.
Having established the above general principles, you are advised as follows.
Your son is a member of your "immediate family" as that term is defined in the
Ethics Act.
Section 1103(a) of the Ethics Act, pertaining to conflict of interest, imposes
restrictions upon public officials and public employees. Section 1103(a) of the Ethics
Act would impose restrictions upon you in each of your capacities as a public official
and a public employee, rather than upon you in your private capacity. Therefore,
Section 1103(a) would not prohibit you from acting in your private capacity to solicit the
owners of Business 1, Business 2, or Business 3 to sponsor the Hockey Team.
In each of your public capacities as the Director of Business and Finance for the
School District and the Secretary of the School District School Board, you would have a
conflict of interest under Section 1103(a) of the Ethics Act with regard to having
involvement with matter(s) pertaining to business(es) from which you would solicit or
obtain sponsorships for the Hocke Team — including but not limited to Business 1,
Business 2, or Business 3 —if: (1� you would be consciously aware of a private
pecuniary benefit for you, a member of your immediate family such as your son, or a
business with which you or a member of your immediate family is associated; (2) your
action(s) would constitute one or more specific steps to attain that benefit; and (3)
neither of the statutory exclusions to the definition of 'conflict" or "conflict of interest" as
set forth in the Ethics Act, 65 Pa.C.S. § 1102, would be applicable. Cf., Kistler, supra.
In each instance of a conflict of interest, you would be required to a� 6stain ully T om
participation.
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
Mansmann, 18550
August 1, 2018
Page 5
interpretation of the Ethics Act. Specifically not addressed herein is the applicability of
the Public School Code.
Conclusion: Based upon the submitted facts that: (1) you have been emplo ed
as a Director of Business and Finance for the Canon - McMillan School District
�"School District" since 2007; (2) you are also the Secretary of the School District
chool Board; (3) you have two children who attend schools in the School District; (4)
although obtaining corporate sponsorships is a key fundraising effort for many of your
children's extracurricular activities, you typically have not participated in these efforts;
(5) the Canon - McMillan Hockey Association (the "Hockey Association ") is a non - profit
501(c)(3) corporation that operates an amateur hockey program for School District
students in grades six through twelve; (6) the Hockey Association has two Middle
School teams, two ,Junior Varsity teams, and one AAA Varsity team; (7 the expenses
associated with playing on a Hockey Association team include costs ?or the player's
registration and equipment as well as an assessment fee for the current season (the
"Assessment Fee $T (8) the Hockey Association receives no funding or financial support
of any kind from the School District, and all operating expenses are paid from income
generated from Assessment Fees, various fundraising events, and charitable
contributions from local businesses; (9) the Hockey Association has a sponsorship
program (the "Sponsorship Program ") that offers businesses the opportunity to sponsor
Hockey Association teams; (10 a sponsor of a Hockey Association team is provided
with opportunities for advertising or recognition in return for a tax - deductible donation;
(11 ) there are four levels of sponsorships available for donations ranging from $250.00
to $2,500.00: (12) a credit will be a plied to a player's Assessment Fee for each
sponsor obtained by the player; (13) depending upon the level of sponsorship chosen
by a sponsor, a player will get a credit in the amount of $75.00, $150.00, $300.00, or
$750.00 applied to the player's Assessment Fee; (14) you have a son who will be a
player on one of the Hockey Association's Middle School teams (the "Hockey Team ")
for the 2018 -2019 hockey season; (15) you would like to solicit the owners of three
businesses to sponsor the Hockey Team; (16) two businesses that you utilize in a
private capacity -an auditor ( "Business 1") and an insurance broker ("Business 2 ")—
have Ion - standing contracts with the School District which are not up for renewal at this
time; (17� you have personal relationships with the owners of Business 1 and Business
2 that existed prior to your employment with the School District and are unrelated to
School District business; and (118) the third business ( "Business 3 ") is owned by an
individual who previously served as a School Director for the School District, you are
advised as follows.
This Advice assumes, without deciding, that in your capacity as the Director of
Business and Finance for the School District, you are a public employee subject to the
provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. §
1101 et se g, In your capacity as the Secretary of the School District School Board, you
are a pu is official subject to the provisions of the Ethics Act.
Your son is a member of your `.immediate family" as that term is defined in the
Ethics Act. Section 1103(a) of the Ethics Act, pertaining to conflict of interest, imposes
restrictions upon public officials and public employees. Section 1103(a) of the Ethics
Act would impose restrictions upon you in each of your capacities as a public official
and a- public employee, rather than upon you in your private capacity. Therefore,
Section 1103(a) would not prohibit you from acting in your private capacity to solicit the
owners of Business 1, Business 2, or Business 3 to sponsor the Hockey Team.
In each of your public capacities as the Director of Business and Finance for the
School District and the Secretary of the School District School Board, you would have a
conflict of interest under Section 1103(a) of the Ethics Act with regard to having
involvement with matters) pertaining to business(es) from which you would solicit or
obtain sponsorships for the Hockey Team — including but not limited to Business 1,
Business 2, or Business 3 —if: (1) you would be consciously aware of a private
pecuniary benefit for you, a member of your immediate family such as your son, or a
Mansmann, 18 -550
ugguust 7 2018
Page 6
business with which you or a member of your immediate family is associated, (2) your
action(s) would constitute one or more specific steps to attain that benefit; and (3)
neither of the statutory exclusions to the definition of 'conflict" or "conflict of interest" as
set forth in the Ethics Act, 05 Pa.C.S. § 1102, would be applicable. In each instance of
a conflict of interest, you would be required to abstain fully from participation.
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 Opin ►on 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 of this
AdFice pursuant to 51 Pa. Code § 13.2(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.
Sincerely,
F Y v
Robin M. Hittie
Chief Counsel