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HomeMy WebLinkAbout90-587 SchwabSTATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL August 23, 1990 Mr. William G. Schwab 811 Blakeslee Blvd. Dr. East 90 - 587 P.O. Box 56 Lehighton, PA 18235 Re: Conflict, Public Official /Employee, School Director, Immediate Family, Business with Which Associated, Non - Profit Hospital, Vote, Tax Exempt Status. Dear Mr. Schwab: This responds to your letter of July 24, 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 school director from voting upon the tax exempt status or the assessment of a non - profit hospital wherein his spouse is employed as a nurse. Facts: As solicitor for the Lehighton Area School District (District), you inquire as to whether board member Richard Harleman has a conflict under the Public Official and Employee Ethics Act regarding a matter that will come before the District at an August 13, 1990 meeting. The School Board is currently considering protecting the District's interests in filing a second assessment appeal for tax assessment as to the Gnaden Huetten Memorial Hospital, non - profit hospital, as to which the District has began challenging their tax exempt status. That matter is currently pending in Common Pleas Court. The hospital is one of the largest employers in the county and has over two hundred employees, one of which is Harleman's wife who is a registered nurse and is employed by the hospital in a non- management position. You inquire as to whether Mr. Harleman may vote to protect - - the ' District's interests - 'on" filing' a y Flew assessment appeal for the 1990 -1991 school year and also approve the retention of the solicitor and the fees for this matter. You note that at the time of the original vote Ms. Harleman was not employed by the hospital and has only been employed there for a period of week. Discussion: As School Director for Lehighton Area School District, Mr. Harleman is a public official as that term is Mr. William G. Schwab Page 2 defined under the Public Official and Employees 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" or "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 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. "Immediate family." A parent, spouse, child, brother or sister. "Business with which he is associated." Any business in which the person or a member of the person's immediate family is a Mr. William G. Schwab Page 3 director, officer, owner, employee or has a financial interest. 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 anything of monetary value 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. Section 3(j) of the Ethics Law provides as follows: Section 3. Restricted activities. (j) 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 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. Mr. William G. Schwab Page 4 If a conflict exists, Section 3(j) requires the public official /employee to abstain as well as file a written memorandum to that effect with the person recording the minutes or supervisor. In applying the provisions of Section 3(a) of the Ethics Law quoted above and the definitions contained in the Ethics Law, it is clear that the Gnaden Huetten Memorial Hospital is a business with which a member of Mr. Harleman's immediate family is associated. Since Harleman's wife is a registered nurse who is employed by the hospital, the hospital is a business with which.a member of his immediate family is associated. Since the definition of conflict includes a use of authority of office to obtain a private pecuniary benefit for a business with which the public official or member of his immediate family is associated, Mr. Harleman, based upon the above relationship, would be precluded by Section 3(a) of the Ethics Law from voting on the issue of the assessment or tax exempt status as to the Gnaden Huetten Memorial Hospital. As to the second inquiry regarding the approval of the retention of the solicitor and the payment on the legal fees, it appears, although unclear, that the retention relates to the representation of additional service exclusively dealing with the tax status of the Gnaden Huetten Memorial Hospital. If the foregoing assumption is correct and the retention does not relate to just the general retention of the solicitor, then Mr. Harleman would also be precluded on such a vote based upon the analysis above. In addition to abstaining, Mr. Harleman would have to observe the disclosure requirements as set forth in Section 3(j) outlined above. 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 Public School Code. - Cone1nsi:on s -- _ %AE --School ° for -Lehighton = Area" - gchooi ---° - District, Richard Harleman is a public official subject to the provisions of the Ethics Law. Section 3(a) of the Ethics Law would preclude Mr. Harleman as a school director from voting or participating on matters relating to the Gnaden Huetten Memorial Hospital which is a business with which a member of his immediate family is associated. The disclosure requirements of Section 3(j) outlined above must be observed. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Law. Mr. William G. Schwab Page 5 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. 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 request that the full Commission review this Advice. A personal appearance before the Commission will be scheduled and a formal Opinion from the 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 §2.12. Sincerely, 04, Vincent . Dopko, Chief Counsel