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HomeMy WebLinkAbout91-523 MlakerMr. Leslie J. Mlakar Loughran, Mlakar & Bilik 126 S. Pennsylvania Avenue Greensburg, PA 15601 Dear Mr. Mlakar: STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL March 14, 1991 91 -523 Re: Conflict, Public Official /Employee, Township Commissioner, Use of Authority of Office, Voting, Zoning, Real Estate, Immediate Family, Business With Which Associated. This responds to your letters of January 24, 1991 and January 31, 1991, 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 chairman of a township board of commissioners from participating and /or voting on a request for a Zone District Change, when the Commissioner's son owns an interest in a real estate parcel which is in proximity to the property for which the zone change is proposed and is contiguous to lands adjoining the parcel for which the zone change is proposed. Facts: As the solicitor for the Township of Penn in Westmoreland County, Pennsylvania, you have been authorized by the Board of Commissioners of the Township of Penn, as well as its Chairman, Robert Geiger, to seek the advice of the State Ethics Commission. The Township of Penn has received a request for a Zone District Change for a certain parcel of real estate more fully described in a deed dated the 25th day of October, 1990 and recorded in the Office of the Recorder of Deeds in and for Westmoreland County, Pennsylvania. You have provided a copy of said deed marked as Exhibit A which is incorporated herein by reference. The property for which the Zone District Change is sought, is owned by six individuals including Henry E. Turkowski and Noreen C. Turkowski. According to the deed, the interest of Henry and Noreen Turkowski in this parcel is declared to be an undivided 50% interest as tenants by the entireties. The parcel is presently zoned A -1 and Mr. Turkowski desires to have the property rezoned to a B -3, Business Zone. You have submitted photostatic copies of Penn Township tax maps numbered 55 -8 and 55 -13, which you have marked as Exhibits "B" and "C" respectively, which tax maps are incorporated herein by reference. Leslie J. Mlakar Page 2 On the tax maps which you have submitted, you have marked in red pencil the parcel for which the Zone District Change has been proposed and you have designated that parcel by labeling it "Proposed Turkowski Zone Change ". According to the deed and the tax maps, the parcel which is the subject of the "Proposed Turkowski Zone Change" appears to be Parcel 75 on tax map 55 -8, but it continues on tax map 55 -13 and consists of 40 acres more or less. Mr. Turkowski is also the owner of a certain real estate tract designated on tax map number 55 -13 as parcels 25 and 72 which are contiguous to the 40 acre parcel for which the Zone District Change is proposed. You have designated parcels 25 and 72 on tax map number 55 -13 by outlining them with a yellow marker. The Chairman of the Board of Commissioners of Penn Township is Mr. Robert E. Geiger. Chairman Geiger has a son who has reached the age of majority, who is also named Robert Geiger, hereinafter referred to as "son." Along with another individual, Richard D. Pasinski, Chairman Geiger's son acquired a parcel of real estate designated as Parcel 29 on tax map number 55 -13. You have submitted a copy of the deed dated July 20, 1990, marked Exhibit D, by which the Chairman's son and Mr. Pasinski acquired ownership of this parcel. The said deed is incorporated herein by reference. You have designated this particular parcel on the submitted copy of tax map 55 -13 by marking same with a blue marker. You represented the Chairman's son in the purchase of this property. You further note that the property proposed for the Zone District Change (designated as "Proposed Turkowski Change ") adjoins the tract consisting of Parcels 25 and 72 on tax map 55 -13 which parcels are also owned by Mr. Turkowski. Although you do not expressly so state, tax map 55 -13 indicates that the parcel owned by the Chairman's son and Mr. Pasinski (Parcel 29 on Tax Map 55 -13) is contiguous to the tract consisting of Parcels 25 and 72 owned by Mr. Turkowski. Parcel 30 on Tax Map 55 -13 is owned by Maxim and Anna DeRosa, who have no relationship to any of the parties involved. Furthermore, the Chairman's son has an independent private plumbing business and during the past few years, he has performed work for Mr. Turkowski privately as an independent contractor, and he has also performed services for a company known as HET Construction Company, as a subcontractor. Mr. Turkowski is a principal in HET Construction Company. The Board of Commissioners will shortly be considering the request for Zone District Change and the issue has been raised as to whether or not Chairman Geiger may vote on the zone change by reason of the proximity of the property owned by his son to both of the above properties owned by Mr. Turkowski. Leslie J. Mlakar Page 3 The parcel owned by the Chairman's son and Mr. Pasinski (Parcel 29 on Tax Map 55 -13) is presently zoned A -1. The tract owned by Mr. Turkowski designated on Tax Map 55 -13 (Parcels 25 and 72) is presently in an R -1 and a portion of M -1, and that portion which is M -1 is on the dividing line as shown on Tax Map 55 -13, which you have marked by the designation as M -1. As stated above, the property for which Mr. Turkowski seeks a zoning change is presently zoned A -1 but would be rezoned to a B -3, Business Zone, if the request for zoning change is granted. The basis for the complaint is that if a zone change is granted, that it will either directly or indirectly benefit the property owned by the Chairman's son. Furthermore, the issue has been raised as to whether the Chairman's son has, in his employment as an independent contractor, created a potential conflict of interest which would preclude the Chairman of the Board from voting on the request for zoning change. Noting the immediacy of the situation, you seek an advisory opinion and you specifically inquire as to whether or not Chairman Geiger is precluded in any manner from voting on this zone change request under the Ethics Law. Discussion: As Chairman of the Board of Commissioners for the Township of Penn, Westmoreland County, Pennsylvania, Chairman Robert E. Geiger 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" 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 Leslie J. Mlakar Page 4 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 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 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 Leslie J. Mlakar Page 5 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. 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 the event that the required abstention results in the inability of the governmental body to take action because a majority is unattainable due to the abstention(s), then in that event participation is permissible provided the disclosure requirements noted above are followed. In applying the above provisions of the Ethics Law and recent Commission Opinions to the instant matter, it appears that Chairman Geiger would have a conflict in participating in the discussions and /or the voting regarding the request for a. Zone District Change. Under the reasoning of the Commission Opinions in Dettra, Opinion 89- 021 and Mihalik, Opinion 90 -002, discussed below, if Chairman Geiger were to participate or vote regarding the request for a Zone District Change, his participation or vote could result in a private pecuniary benefit for a member of his immediate family - his son. The Chairman's participation vote regarding the request for a Zone District Change could directly impact upon the value and /or marketability of his son's real estate interest, resulting in a private pecuniary benefit to the son who is a member of the chairman's immediate family. The chairman's participation in discussions regarding the request for a Zone District Change and /or his voting on the said request would be a use of authority of his office which would have a direct impact upon the above private pecuniary benefit. The State Ethics Commission considered circumstances similar to those which you have presented in its recent Opinion in Dettra, Leslie J. Mlakar Page 6 Opinion 89 -021. In that case, a township supervisor and his brother had sold certain unimproved real estate under an option agreement. In addition to the base consideration, the option agreement provided that the purchaser would pay the supervisor and his brother additional consideration based upon the number of dwelling units the purchaser could build upon the real estate. Under the agreement, the number of dwelling units was to be either two hundred or the maximum number permitted by the governing authority, whichever was greater. Because the final sale price of the real estate was thus contingent upon the number of buildable lots permitted under the zoning ordinance, the Commission held that the supervisor had a conflict and was prohibited from participating and voting in any matter related to that real estate, including the proposed zoning ordinance. The supervisor was further required to comply with Section 3(j) of the Ethics Law by publicly announcing and disclosing the nature of his interest at the following public meeting in a written memorandum filed with the secretary recording the minutes. In Mihalik, Opinion 90 -002, a Second Class Township Supervisor and his brother owned 180 acres of land, of which sixty acres were subject to an option to purchase by a partnership. The initial six - month option to purchase was in exchange for $5,000 with three additional six -month options available at $5,000 each and a final six - month option available for $10,000. Any exercise of the option was to be accompanied by an additional payment of $25,000, and the agreed consideration for the sale of the real estate would be $1.3 million dollars. Furthermore, the option agreement provided for the purchase of additional property at a cost of $10,000 per acre in the event the partnership would elect to construct its own sewage treatment or disposal system. By order of the Department of Environmental Resources, the township was required to develop a plan for a public sewage system. A comprehensive sewage system would increase the value of land which it serviced in the township, including this particular tract. Furthermore, the partners who had purchased the option agreement from the township supervisor and his brother were involved through various other partnerships in the consortium that planned to build and operate the township sewage plant. The Commission held that the township supervisor would have a conflict precluding him from voting on the comprehensive sewage plan. The Commission noted that the value of the real estate owned by the supervisor and his brother would be raised by the sewage plan. Furthermore, the agreement to sell the option to purchase to the partnership was pending, and the Commission concluded that the issue of sewage facilities would be of primary concern to the partnership. Thus, the supervisor's participation and vote on the sewage plan could impact upon the partnership's decision of whether to exercise the option to purchase the real estate from the supervisor and his Leslie J. Mlakar Page 7 brother. The Commission discounted the supervisor's suggestion that he fit within the exclusionary language of the conflict definition, 65 P.S. 5402. Given the pending option to purchase, the fact that the sewage plan would affect the value of the supervisor's land for development purposes, and the extensive real estate holdings of the supervisor and his brother, the Commission concluded that the supervisor and his brother did not fit within the class of typical residential lot owners in the township nor would they be affected to the same degree as other land owners in the township. See Fulton, Advice 91 -510. Similarly, in this case, the value and /or marketability of the property owned by the Chairman's son could be greatly affected by the proposed Zone District Change. The Chairman's son could realize a private pecuniary benefit as a result of the Chairman's participation or voting on the request for Zone District Change. Just as the Commission in Mihalik, Opinion 90 -002, discounted the suggestion that the supervisor in that case fit within the exclusionary language of the conflict definition, 65 P.S. 5402, it would not appear that the Chairman's son would fit within the exclusionary language. In Cappabianca, Opinion 89 -014R, it was argued to the Commission that a member of the General Assembly charging the rent of his district office in a building which he owns to his legislative account at the prevailing local rate, is a part of the subclass of landlords. The Commission dispelled that argument clearly recognizing that such members are not a subclass but are rather several individual members who have legislative district offices in their own buildings and who charge their legislative account for rent. Id. at 8. As one of the few owners of real estate (other than Mr. Turkowski himself) in close proximity to the parcel for which the Zone District Change is requested, it would not appear that the Chairman's son would fit within the class of typical real estate owners in the township nor would he be affected to the same degree as other land owners in the township. With regard to the question of whether the chairman's son 'has, in his employment as an independent contractor, created a potential conflict of interest which would preclude the Chairman of the Board from voting on this zoning issue, it is not necessary to address this question given the fact that the conflict of interest exists for the aforesaid reasons. Nevertheless, to provide a complete response to your inquiry, there would not appear to be any private pecuniary benefit to any business with which the Chairman's son is associated, as defined under the Ethics Law. Specifically, HET Construction Company would not fit within the definition of "business with which he is associated ", 65 P.S. 5402, under the circumstances as you have presented them. However, this is expressly conditioned on the assumption that the Chairman's son's independent private plumbing business would not benefit by the proposed Zone District Change. There could be circumstances where the sons's business would benefit; Leslie J. Mlakar Page 8 for example, if the son's business is located on the said real estate parcel owned by the son and Mr. Pasinski, and therefore, in proximity to the parcel for which the Zone District Change is being requested, it may be that there is a private pecuniary benefit which would be obtained for the son's business as well. In any event, it is clear under the reasoning of Dettra and Mihalik, the Chairman would have a conflict under Section 3(a) of the Ethics Law and he must, therefore, abstain from participation and /or voting on the request for Zone District Change. He must also observe the disclosure requirements of Section 3(j) outlined above. However, in the event that the required abstention results in the inability of the governmental body to take action because a majority is unattainable due to the abstention(s), than in that instance Section 3(j) would allow the Chairman to vote provided the disclosure requirements noted above are followed. 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 First Class Township Code. Conclusion: As Chairman of the Board of Commissioners for the Township of Penn in Westmoreland County, Pennsylvania, Chairman Robert Geiger is a public official subject to the provisions of the Ethics Law. Section 3(a) of the Ethics Law would preclude Chairman Geiger as a township commissioner from participating in discussions regarding a request for a Zone District Change or voting on such a proposed Zone District Change when the Chairman's son owns an interest in a real estate parcel which is not only in proximity to the parcel for which the Zone District Change is requested, but is also contiguous to lands adjoining the said parcel for which the Zone District Change is requested. Section 3(j) of the Ethics Law requires that Chairman Geiger publicly announce and disclose at the next public meeting the nature of his interest in a written memorandum filed with the secretary who keeps the minutes. In the event that the required abstention results in the inability of the governmental body to take action because a majority is unattainable due to the abstention(s), then in that event Section 3(j) would allow Chairman Geiger to vote in that instance provided the disclosure requirements of Section 3(j) outlined above are followed. 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 requester has disclosed truthfully all the material Leslie J. Mlakar Page 9 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 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 S2.12. Sincerely, Vincent -'. Dopko, Chief Counsel