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Home My WebLink About90-577 StewartDear Mr. Stewart: STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL August 1, 1990 Mr. Richard W. Stewart Johnson, Duffie, Stewart & Weidner Third & Market Streets P.O. Box 109 Lemoyne, PA 17043 -0109 90 - 577 Re: Conflict, Public Official /Employee, Township Supervisor, Partnership, Sale of Land by Partnership to Developer, Vote on Development Plan. This responds to your letters of June 7, 1990 and July 25, 1990, in which you requested advice from the State Ethics Commission. Issue: Whether the Public. Official and Employee Ethics Law presents any prohibition or restrictions upon a second class township supervisor who has sold his interest in a partnership which in turn has an agreement to sell land to a developer who has submitted a development plan for the land to the township. Facts: As the solicitor for Fairview Township, York, Pennsylvania and on behalf of chairman of the board of supervisors Charles J. Bender, Jr., you seek an advisory opinion under Act 9 of 1989. Mr. Bender previously owned a 16 2/3% interest in a partnership known as 8376 Associates, which is the owner of an eighty -three parcel of real estate situated in Fairview Township. The remaining five partners are Mssrs. Adler and Sariano who each have a 25% interest and Mssrs. Murphy, Helstrom and Soss who each have a 16 2/3% interest. Mr. Bender has sold his interest in the partnership as of December of 1989 and the partnership still owes him a portion of the purchase price which is evidenced by a promissory note, a photocopy of which has been submitted. The Note reflects an obligation to Mr. Bender in the amount of $92, 996.65 payable on or before February 15, 1991 at a certain interest rate together with a prepayment option. The obligation to make the payment is absolute and not dependent upon 8376 Associates' sale of the land in Fairview Township or any other of the partnership's assets. In addition, the partners are individually liable on the note and are able, Mr. Richard W. Stewart Page 2 through sufficient reserves, to pay the obligation to Mr. Bender separate and part from the sale of the eighty -three acres of realty. You further advise that one partner alone has enough sufficient liquid assets to satisfy the obligation even if the eighty three acre parcel is not sold. 8376 Associates had entered into an agreement to sell the eighty -three acre parcel of land to a shopping center developer conditioned upon the shopping center developers gaining approval of plans for a massive shopping center on the site. The prospective purchaser has submitted a land development plan to the board of supervisors of Fairview Township for approval. You inquire as to whether Mr. Bender is able to vote on the land development plans submitted by the prospective developer of the shopping center. Discussion: As a supervisor for Fairview Township, Charles C. Bender, Jr. is a public official as that term is defined under the Ethics Law, and hence he is subject to the provisions of that law. Section 3(a) of the Ethics Law provides: Section 3. Restricted Activities. (a) No public official or public employee shall engage in conduct that constitutes a conflict of interest. The following terms are defined in the Ethics Law as follows: Section 2. 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. "Conflict"' "conflict of interest" 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 or his immediate family or a business with Mr. Richard W. Stewart Page 3 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 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. In addition, Sections 3(b) and 3(c) of the Ethics Law provide in part that no person shall offer to a public official /employee and no public official /employee shall solicit or accept any thing of monetary value based upon the understanding that the vote, official action, or judgement of the public official /employee would be influenced thereby. Reference is made to these provisions of the law not to imply that there has or will be any transgression thereof but merely to provide a complete response to the question presented. Under Section 3(a) of the Ethics Law quoted above, this provision of law restricts a public official /employee from using the authority of his office or confidential information to obtain a private pecuniary benefit for himself, member of his immediate family or business with which he or a member of his immediate family is associated. Under the proffered facts, it does not appear and it is expressly assumed that the prospective purchaser /shopping center developer is not a business with which Mr. Bender is associated as that term is defined under the Ethics Law. Although Mr. Bender may have a financial interest in 8376 Associates in light of the fact that he is the obligee of the balance of a purchase price, assuming that such constitutes more than five percent of the assets of the economic interests and indebtness, Mr. Bender does not have a financial interest, based upon the submitted facts, as to the prospective purchaser/ shopping center developer. Accordingly, based upon the above assumptions, Mr. Bender would not precluded from voting upon the Mr. Richard W. Stewart Page 4 development plans submitted by the prospective developer of the shopping center since the latter is not a business with which he is associated as that term is defined under the Ethics Law. In addition, it does not appear that the voting by Mr. Bender would result in a private pecuniary benefit to himself because, once again under the proffered facts, you have stated that Mr. Bender has sold his interest in the partnership which is absolute and not dependent upon the sale by 8376 Associates of the land in Fairview Township or any other partnership assets. In this regard, the partners have sufficient reserves to satisfy the obligation to Mr. Bender regardless of whether the eighty three acre parcel is sold to the developer. Therefore, based upon the factual representations, Mr. Bender's vote would not result in a private pecuniary benefit to himself and consequently he would not be prohibited from voting on this matter under Section 3(a) of the Ethics Law. The propriety of the proposed conduct has only been addressed under the Ethics Law; the applicability of any other statute, code, ordinance, regulation or other code of conduct other than the Ethics Law has not been considered in that they do not involve an interpretation of the Ethics Law. Specifically not addressed herein is the applicability of the Second Class Township Code. Conclusion: As Supervisor for Fairview Township, Charles C. Bender, Jr. is a public official subject to the provisions of the Ethics Law. Section 3(a) of the Ethics Law would not prohibit the township supervisor from voting on a development plan by a prospective purchaser of land from a partnership of which the supervisor has sold his partnership interests, since the prospective developer is not a business with which he is associated as that term is defined under the Ethics Law. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Law. Pursuant to Section 7(11), this 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, providing the requestor has disclosed truthfully all the material facts and committed the acts complained of in reliance on the Advice given. such. This letter is a public record and will be made available as Finally, if you disagree with this Advice or if you have any reason to challenge same, you may request that the full Commission review this Advice. A personal appearance before the Commission will be scheduled and a formal Opinion from the Mr. Richard W. Stewart Page 5 Commission will be issued. Any such appeal must be in writing and must be received at the Commission within 15 days of the date of this Advice pursuant to 51 Pa. Code x2.12. Sincerely, Vincent J. Dopko, Chief Counsel