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HomeMy WebLinkAbout18-574 KaleugherPHONE: 717 -783 -1610 TOLL FREE: 1- 800- 932 -0936 r - a STATE ETHICS COMMISSION FINANCE BUILDING 613 NORTH STREET, ROOM 309 HARRISBURG, PA 17120 -0400 ADVICE OF COUNSEL December 13, 2018 To the Requester: Mr. Michael B. Kaleugher, Esquire Dear Mr. Kaleugher: FACSIMILE: 717- 787 -0806 WEBSITE: www.ethics.pa.gov 18574 This responds to your letter dated November 6, 2018 (postmarked November 9, 2018, received November 13, 2018), by which you requested an advisory from the Pennsylvania State Ethics Commission ('Commission"). Issue: Whether, pursuant to Section 1103(a) of the Public Official and Employee E ics Act ( "Ethics Act'), 65 Pa:C.S. § 1103(a), an individual serving as both: f a Member of the Board of Commissioners of Collier Township ( "Township "); and (2� a Member and Vice - Chairman of the Board of the Collier Township Municipal Authority ( "Municipal Authority "), would have a conflict of interest in either of his aforesaid capacities with regard to voting on an agreement to transfer the ownership and operation of certain sanitary sewer lines from the Township to the Municipal Authority. Facts: You have been authorized by Richard Ruffennach ( "Mr. Ruffe nnach ") to request an advisory from the Commission on his behalf. You have submitted facts that may be fairly summarized as follows. The Township created the Municipal Authority for the purposes of owning, installing, and maintaining a sanitary sewer conveyance system (the "Sewer System ) within the Township. The Township appoints the Members of the Board of the Municipal Authority. In approximately 1995, a private developer (the "Developer ") purchased property in the Township and asserted ownership rights to certain sanitary sewer capacity within the Sewer System. Because of a disagreement among all of the parties Involved, the Township entered Into agreements with the Developer to construct the sanitary sewer lines (the "Sewer Lines ") for the Developer's commercial /residential development. The Sewer Lines connect Into the regional treatment authority, ALCOSAN, which has discharge agreements with the Township and the Municipal Authority. In October 2013, Mr. Ruffennach was appointed to the Municipal Authority Board, and he currently serves as Vice - Chairman of the Municipal Authority Board. On January 1, 2018, Mr. Ruffennach began serving as a Member of the Township Board of Commissioners. The Township Board of Commissioners proposes to transfer the ownership and operation of the Sewer Lines to the Municipal Authority without consideration. The Kale u her, 18 -574 Me ember 13, 2018 Page 2 Township is currently involved in litigation related to the Sewer Lines that was filed by an environmental agency. Although the litigation may ultimately be resolved by agreements entered into by various entities, it is anticipated that the litigation will not be resolved as of the date proposed for the transfer of the ownership and operation of the Sewer Lines. Based upon the above submitted facts, you ask whether Mr. Ruffennach, in his capacity as a Member of the Township Board of Commissioners or in his capacity as a Member and Vice- Chairman of the Municipal Authority Board, would be permitted to vote on an agreement that would transfer the ownership and operation of the Sewer Lines from the Township to the Municipal Authority. Discussion: It is initially oted that pursuant to Sections 1107(10) and 1107(11) of e Ethics Act, 65 Pa.C.S. y§§ 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. §§ 110700 , (11). An advisory only affords a defense to the extent the requester has truthfully disc osed all of the material facts. It is further initially noted that, pursuant to the same aforesaid Sections of the Ethics Act, an opinion/advice may be given only as to prospective (future) conduct. To the extent that your inquiry relates to conduct that has already occurred, such past conduct may not be addressed in the context of an advisory opinion. However, to the extent your inquiry relates to future conduct, your inquiry may and shall be addressed. As a Member of the Township Board of Commissioners and as a Member and Vice - Chairman of the Municipal Authority Board, Mr. Ruffennach is a public official subject to the provisions of the Ethics Act. Sections 1103(a) and 1103Q) 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 provided herein. In the case of a three - member governing body of a political subdivision, where one member has Kafeu her, 18 -574 December 13, 2018 Page 3 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), Q). 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 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 industryry, 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. "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. "Political subdivision." Any county, city, borough, incorporated town, township, school district, vocational school, county institution district, and any authority, entity or body organized by the aforementioned. 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 officiallpublic employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. Kateeu he_r, 18 -574 ecp ember 13, 2018 Page 4 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 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. In ap Igg the above provisions of the Ethics Act to the instant matter, you are advised as follows. Mr. Ruffennach would not have a conflict of interest under Section 1103(a) of the Ethics Act either in his capacity as a Member of the Township Board of Commissioners or in his capacity as a Member and Vice - Chairman of the Municipal Authority Board in matter(s) that would financially impact the Township or the Municipal Authority but that would not financially impact him, a member of his immediate family, or a business with which he or a member of his immediate family is associated. A pecuniary benefit flowing solely to a governmental entity - -such as the Township or the Municipal Authority - -would not form the basis for a conflict of interest under Section 1103(a) of the Ethics Act. See, Confidential Opinion, 01 -005; McCarrier /Anderson, Opinion 98 -008; Warso, Order 974. Therefore, as to each of Mr. Ruffennach's public capacities- -that is, as a Member of the Township Board of Commissioners or as a Member and Vice - Chairman of the Municipal Authority Board -- absent some basis for a conflict of interest such as a private pecuniary benefit for Mr. Ruffennach, a member of his immediate family, or a business with which he or a member of his immediate family is associated, Mr. Ruffennach would not have a conflict of interest with regard to voting on an agreement that would transfer the ownership and operation of the Sewer Lines from the Township to the Municipal Authority. The proprietyy 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 not addressed herein is the applicability of the First Class Township Code or the Municipality Authorities Act. Conclusion: Based upon the submitted facts that: (1) Collier Township ("Township") created the Collier Township Municipal Authority ( "Municipal Authority ") for the purposes of owning, installing, and maintaining a sanitary sewer conveyance system (the "Sewer System ") within the Township, (2) the Township appoints the Members of the Board of the Municipal Authority; (3) in approximately 1995, a private developer (the "Developer ") purchased property in the Township and asserted ownership rights to certain sanitary sewer capacity within the Sewer System; (4) because of a disagreement among all of the parties involved, the Township entered into agreements with the Developer to construct the sanitary sewer lines (the "Sewer Lines ") for the Developer's commercial /residential development; (5) the Sewer Lines connect into the regional treatment authority, ALCOSAN, which has discharge agreements with the Township and the Municipal Authority; (6) in October 2013, Richard Ruffennach ( "Mr. Ruffennach ") was appointed to the Municipal Authority Board, and he currently serves as Vice - Chairman of the Municipal Authority Board; (7) on January 1, 2018, Mr. Ruffennach began serving as a Member of the Township Board of Commissioners; (8) the Township Board of Commissioners proposes to transfer the ownershi and operation of the Sewer Lines to the Municipal Authority without consideration; �9) the Township is currently involved in litigation related to the Sewer Lines that was filed by an environmental agency; and (10) although the litigation may ultimately be resolved by Kaleugher, 18 -574 ecD ember 13, 2018 Page 5 agreements entered into by various entities, it is anticipated that the litigation will not be resolved as of the date proposed for the transfer of the ownership and operation of the Sewer Lines, you are advised as follows. As a Member of the Township Board of Commissioners and as a Member and Vice - Chairman of the Municipal Authority Board, Mr. Ruffennach is a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seg. Mr. Ruffennach would not have a conflict of interest under Section 1103(a) of the Ethics Act either in his capacity as a Member of the Township Board of Commissioners or in his capacity as a Member and Vice - Chairman of the Municipal Authority Board in matter(s) that would financially impact the Township or the Municipal Authority but that would not financially impact him, a member of his immediate family, or a business with which he or a member of his immediate family is associated. A pecuniary benefit flowing solely to a governmental entity - -such as the Township or the Municipal Authority - -would not form the basis for a conflict of interest under Section 1103(a) of the Ethics Act. Therefore, as to each of Mr. Ruffennach's public capacities -.that is, as a Member of the Township Board of Commissioners or as a Member and Vice- Chairman of the Municipal Authority Board -- absent some basis for a conflict of interest such as a private pecuniary benefit for Mr. Ruffennach, a member of his immediate family, or a business with which he or a member of his immediate family is associated, Mr. Ruffennach would not have a conflict of interest with regard to voting on an agreement that would transfer the ownership and operation of the Sewer Lines from the Township to the Municipal Authority. 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 of this Advice pursuant to 51 Pa. Code § f3.2(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 Me such an appeal at the Commission within thirty (30) days may result in the dismissal of the appeal. Sincerely, Robin M. Hittie Chief Counsel