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To the Requester:
STATE ETHICS COMMISSION
FINANCE BUILDING
613 NORTH STREET, ROOM 309
HARRISBURG, PA 17120 -0400
ADVICE OF COUNSEL
December 28, 2018
FACSIMILE: 717- 787 -0806
WEBSITE: www.ethics.12a.gov
18 -576
This responds to your letters dated November 15, 2018 (postmarked November
20, 2018, received November 26, 2018), by which you requested a confidential advisory
from the Pennsylvania State Ethics Commission ( "Commission ").
Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65
aa. 'S. § 1101 et sec.., would impose prohibitions or restrictions upon an individual
serving as an A oft e B of the C, who in a private capacity is the founder, owner, and
[title] of an entity that provides various services to D and E F Gs in the C and their Hs,
with regard to the advertisement of the availability of the entity's services by providing Is
to C Fs to be included in packets of materials J with Gs.
Facts: You have been authorized b Individual K to request a confidential
ac vlissory from the Commission on her behalf. You have submitted facts that may be
fairly summarized as follows.
In [month, year] Individual K was appointed as an A of the C B.
In a private capacity, Individual K is the founder owner, and [title] of [names of
business(es)], collectively referred to herein as "L," whick provides various services to D
and E F Gs in the C and their Hs. Such services include [certain services]. L
occasionally donates services to Hs, such as by offering free Ms to Gs.
Prior to Individual K's appointment to the B, L advertised its services quarterly by
providing Is to C Fs for inclusion in packets of materials J with. Gs. Such p ackets are
ssembled by Ns through an F's O, which is a [t e of entity] that falls under the
umbrella of the P and is not under the control of the B. An F's O may assist the F with
the distribution of materials to Gs, and the O distribution process operates at no cost to
the C.
The materials distributed to Gs through the O distribution process include C
materials and approved non- -C materials supplied by commercial and non- profit
organizations and other entities providing [type of activities]. Any entity that desires to
distribute an I may request to do so, but all materials must be approved by the F
through the C Q. Although a Q generally approves only the distribution of Is that are
from businesses within the F's community and are for services or events which are free,
Confidential Advice, 18 -576
December 26, 2U 18
Page 2
the Q may approve the distribution of Is advertising commercial and non - profit services
or events for which there is a fee when the Q considers those services or events to be
of interest or benefit to the F community.
As. an A of the B, Individual K will be provided with confidential information and in
a position to make decisions concerning rcertain C- related matters]. Individual K will
also have the authority to vote on employment matters concerning the C Qs who
approve the distribution of Is.
Based upon the above submitted facts, you pose the following questions:
(1) Whether, pursuant to Sections 1103(a), 1103(b), and 1103(c) of the Ethics
Act, Individual K and/or L would be permitted to advertise personal
business services through the C's O distribution process, which would
result in a private pecuniary benefit to Individual K and L; and
(2) Whether, pursuant to Sections 1103(a), 1103(b), and 'I 103(c) of the Ethics
Act, L would be permitted to advertise ersonall business services through
the C's O distribution process if Individual K would abstain from voting on
any decisions specifically regarding the F where the advertising would
take place, including decisions on employment matters concerning the C
Q(s) or other individual(s) who would approve the distribution of Is.
Discussion: It is initial) noted that pursuant to Sections 1107(10) and 1107(11) of
e tics ct, 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 an A of the B, Individual K 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.
{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
Confidential Advice, 18 -576
December 28, 20 16
Page 3
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), 0).
The following terms related to Section 1103(a) are defined in the Ethics Act as
follows:
§ 11 02. 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 of 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 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.
65 N.C.& § 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 byy 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.
Confidential Advice, 18 -576
ecem e— ,
Page 4
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
conflict, 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.
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
t ics 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(x) of the Ethics
Act, a public officiallpublic 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.
Sections 1103(b) and 1103(c) of the Ethics Act provide in part that no person
shall offer or give to a public off iciallpublic employee anything of monetary value and no
public official/public employee shall solicit or accept anything of monetary value based
u on the understanding that the vote, official action, or judgment of the public
officiallpublic employee would be influenced thereby.
Having established the above general principles, you are advised as follows.
L is a business with which Individual K is associated in her capacities as the
owner and an officer ([title]).
Section 1103(a) of the Ethics Act, pertaining to conflict of interest, would impose
restrictions upon Individual K in her capacity as a public official, rather than upon
Individual K in her private capacity.
You are advised that subject to the conditions that. (1) Individual K would not use
the authority of her position as an A of the B or confidential information received by
being in such position to attain a private pecuniary benefit for herself or L contrary to
Section 1103(a) of the Ethics Act; and (2) there would be no improper understanding
contrary to Sections 1103(b)/1103(c) of the Ethics Act, the Ethics Act would not prohibit
Individual K, in her private capacity, and/or L, from advertising personal business
services through the C's O distribution process.
Per Commission precedent, in her capacity as an A of the B, Individual K would
have a conflict of interest under Section 1103(a) of the Ethics Act in employment
matter(s) concerning the C Q(s) or other individual(s) who would approve the
distribution of such Is. See, Confidential Opinion 05 --004; Elisco, Opinion 00 -003;
Woo�dring, Opinion 90 -00 (involving reciprocity of power); see a so, epak, Advice 16-
538; Kopas, Advice 11-521.
Individual K would not have a conflict of interest and would not violate Section
1103(a) of the Ethics Act by participating in vote(s) of the B in other matter(s) regarding
Confidential Advice, 18 -578
December 28, 2018
Page 5
an F where the advertising would take place unless: (1) Individual K would be
consciously aware of a private pecuniary benefit. for herself, a member of her immediate
family, or a business with which she or a member of her immediate family is associated,
such as L; (2) her action(s) would constitute one or more specific steps to attain that
benefit; and (3) neither the de minimis exclusion nor 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.
In each instance of a conflict of interest, Individual K 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 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 not addressed herein is the applicability of
the R.
Conclusion: Based upon the submitted facts that: (1) in [month, ear] Individual
was appointed as an A of the B of the C; (2) in a private capacity, Individual K is the
founder, owner, and [title] of [names of business(esa's collectively referred to herein as
"L," which provides various services to D and E F in the C and their Hs; (3) such
services include [certain services]; (4 L occasionally donates services to Hs, such as by
offering free Ms to Gs; (5) prior to In ividual K's appointment to the C B, L advertised its
services quarterly by providing Is to C Fs for inclusion in packets of materials d with Gs;
(6 such packets are assembled by Ns through an F's O, which is a [typpe of entityy] that
falls under the umbrella of the P and is not under the control of the B; (7 an F's O may
assist the F with the distribution of materials to Gs, and the O distribution process
operates at no cost to the C; (8) the materials distributed to Gs through the O
distribution process include C materials and approved non -C materials supplied b
commercial and non- profit organizations and other entities providing [type of activities
(9) any entity that desires to distribute an I may request to do so, but all materials must
be approved by the F through the C Q; (10) although a Q generally approves only the
distribution of Is that are from businesses within the F's community and are for services
or events which are free, the Q may approve the distribution of Is advertising
commercial and non - profit services or events for which there is a fee when the Q
considers those services or events to be of interest or benefit to the F community; (11)
as an A of the B, Individual K will be provided with confidential information and in a
position to make decisions concerning [certain C- related matters]; and (12) Individual K
will also have the authority to vote on employment matters concerning the C Qs who
approve the distribution of is, you are advised as follows.
As an A of the B, Individual K 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. L is a
business with which Individual K is associated in her capacities as the owner and an
officer ([title]). Section 1103(a) of the Ethics Act, pertaining to conflict of interest, would
impose restrictions upon Individual K in her capacity as a public official, rather than
upon Individual K in her private capacity.
Subject to the conditions that: (1) Individual K would not use the authority of her
position as an A of the B or confidential information received by being in such position to
attain a private pecuniary benefit for herself or L contrary to Section 1103(a) of the
Ethics Act; and (2) there would be no improper understanding contrary to Sections
1103(b)11103(c) of the Ethics Act, the Ethics Act would not prohibit Individual K, in her
private capacity, andlor L, from advertising personal business services through the C's
0 distribution process.
Confidential Advice, 18 -576
December 28, 2018
Page 6
Per Commission precedent, in her capacity s an A of the B, Individual K would
have a conflict of interest under Section 1103(ya) of the Ethics Act in employment
matter(s) concerning the C Q(s) or other individual(s) who would approve the
distribution of such Is.
Individual K would not have a conflict of interest and would not violate Section
1103(a) of the Ethics Act by participating in vote(s) of the B in other matter(s) regarding
an F where the advertising would take place unless: (1) Individual K would be
consciously aware of a rivate pecuniary benefit for herself, a member of her immediate
family, or a business with which she or a member of her immediate family is associated,
such as L; (2) her action(s) would constitute one or more specific steps to attain that
benefit; and (3) neither the de minimis exclusion nor 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.
In each instance of a conflict of interest, Individual K would be required to abstain
from participation, which would include voting unless one of the statutory exceptions of
Section 1103{j) 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. 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 actuall
received at the Commission within thirty (30) days of the date obis
Advice pursuant to 59 Pa. Code § 73.2(h). The appeal may be
received at the Commission by hand delivery, United States mail,
delivery service, or by FAX transmission (797 - 787 -0806. Failure to
file such an appeal at the Commission within thirty (30) days may
result in the dismissal of the appeal.
Sincerely,
r-
Robin M. Hittie
Chief Counsel