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HomeMy WebLinkAbout91-559 McNultyRichard A. McNulty President Franklin Borough Council Borough of Franklin Municipal Building 125 Main Street Conemaugh, PA 15909 STATE ETHICS COMMISSION 309 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL July 16, 1991 91 -559 Re: Simultaneous Service, Borough Tax Collector and Borough's Liaison under Financially Distressed Municipalities Act. Dear Mr. McNulty: This responds to your letter of May 28, 1991, in which you requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Law imposes any prohibition or restrictions upon a Borough Tax Collector from also serving or being employed as the Borough's Liaison under Act 47, the Financially Distressed Municipalities Act. Facts: As the elected Borough Tax Collector for the Borough of Franklin, with duties commencing January 1, 1992, you seek the advice of the State Ethics Commission. You have been a Councilman in the Borough since January 1, 1988. Your term as Councilman expires on December 31, 1991. During the course of your four years of service as Councilman the Borough was declared a distressed municipality under Act 47 in July of 1988. Since that time, you have worked closely with the Department of Community Affairs officials in implementing the Borough's Recovery Plan. You have submitted a letter from Mr. William Harral, Municipal Administration Consultant with the Department of Community Affairs, which letter is incorporated herein by reference. The letter is directed to the Borough Council and suggests that the Council appoint you as the Act 47 Liaison for Richard A. McNulty July 16, 1991 Page 2 Franklin Borough after your term as Councilman expires. Your duties as Liaison would begin in January of 1992. Your duties as the elected Tax Collector for the Borough will also begin on January 1, 1992. Your narrow and specific inquiry is whether there is any type of conflict in your performing both positions. You state that your responsibilities as Liaison are as outlined by Mr. Harral in the incorporated letter which states, in pertinent part: We would like to suggest that Council consider officially designating Mr. McNulty the Borough's Act 47 Liaison. In Section 247 (a) (3), of Act 47, under plan implementation, the Plan Coordinator's duties provide that he shall: "Oversee completion of the plan either by directly controlling the implementation process or by turning the implementation process over to a person designated by the governing body, or by the Chief Executive Officer, as the case may be. The person designated shall supply the Coordinator with monthly reports." The responsibilities of the Borough's Liaison would be to implement the Recovery Plan in cooperation with the Council, the Mayor, The Secretary, and the DCA Coordinator. He would be the primary liaison between the DCA's Coordinator and the other Borough Officials and would be responsible for supplying the Coordinator with at least monthly reports. (Letter of May 21, 1991 at 1). Mr. Harral praises your provision of leadership and the role of the Borough officials in the plan implementation so far. During the second half of 1991, the Department will be reassessing the Borough's Act 47 status. The process will revise and update the original recommendations and provide guidance for the Borough for the next several years. Mr. Harral states, "We see no apparent conflict of interest in Mr. McNulty's assuming this role [as the Act 47 Liaison for the Borough] as either a private resident of the Borough or as an elected borough official, as long as there is no remuneration for his Act 47 Liaison responsibilities." (Letter of May 21, 1991 at 2). Richard A. McNulty July 16, 1991 Page 3 Discussion: As an elected Tax Collector for the Borough of Franklin, you are a "public official" as that term is defined in the Ethics Law and hence you are subject to the provisions of the Ethics Law. 65 P.S. 5402; 51 Pa. Code S1.1. Section 3(a) of the Ethics Act 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 under the Ethics Law: Section 2. Definitions. "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. 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 "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. Richard A. McNulty July 16, 1991 Page 4 value based upon the understanding that official /employee would be influenced thereby. In applying the above provisions of the Ethics Law - and only the Ethics Law - to the question of simultaneous service there does not appear to be any real possibility of a private pecuniary benefit or inherent conflict arising if you were to serve both as a public official /employee and as the Borough of Franklin's Act 47 Liaison. The term "Liaison" is not defined by the Financially Distressed Municipalities Act and the source of that terminology is not apparent. However, the quoted provisions from Mr. Harral's letter infer that the Plan Coordinator is the "DCA Coordinator" and that he would be turning over to you as the Borough's Liaison the implementation process of the Recovery Plan. You would be working in cooperation with the Council, the Mayor, the Secretary, and the DCA Coordinator. Basically, the Ethics Law does not state that it is inherently incompatible for a public official /employee to serve or be employed in the above capacity. The main prohibition under the Ethics Law and Opinions of the Ethics Commission is that one may not serve the interests of two persons, groups, or entities whose interests may be adverse. Smith Opinion, 89 -010. If a situation arises where you or the respective entities you represent develop an adverse interest, then you must remove yourself from that particular matter and disclose the nature of your interest in a written memorandum to the appropriate person (supervisor or secretary who keeps the minutes). If such a situation would arise, additional advice may be sought from the Commission. You are cautioned that this advice addresses your narrow inquiry only, and only within the parameters of the Ethics Law. The Commission does not specifically have the statutory jurisdiction to interpret, for example, the Borough Code or the Financially Distressed Municipalities Act. However, your prospective conduct raises serious questions under these other statutes. A concern is noted that under the Borough Code, an elected borough official of a borough with a population of 3,000 or more may not serve as an employee of that borough. 53 P.S. S46104. A further concern is noted under the Financially Distressed Municipalities Act which specifically prohibits an elected or appointed official or employee of the municipality from serving as the plan coordinator: 511701.221. Designation Richard A. McNulty July 16, 1991 Page 5 (b) Qualifications. -The coordinator may be an employee of the department, furnished with additional staff or consultant assistance, if needed, or may be a consultant or consulting firm. No elected or appointed official or employee of the municipality shall be eligible for serving as coordinator. The coordinator shall be experienced in municipal administration and finance. 53 P.S. S11701.221(b) (Emphasis added). Furthermore: S 11701.224. Coordinator barred from elective office The coordinator may not run for an elected office of the municipality or its coterminous political subdivisions within two years after the final adoption of a plan pursuant to this act. 53 P.S. S11701.224. Clearly, as an elected official of the Borough you could not serve as its Plan Coordinator pursuant to the above provisions of law. These provisions appear to evidence a strong legislative intent that the duties of the plan coordinator be performed by an individual who is not an official or employee of the municipality and will not become such an official or employee of the municipality for at least 2 years after the recovery plan is adopted. The statutory duties of the coordinator are as follows: 511701.221. Designation (d) Duties. -The coordinator shall prepare and administer a plan designed to relieve the financial distress of the municipality which he has been appointed to serve. 53 P.S. S11701.221(d). The language of Section 247(a)(3) which Mr. Harral emphasized in his letter infers that the Plan Coordinator would be turning over the implementation process of the Recovery Plan to you as Liaison. Thus, it appears that in your capacity as the Borough's Liaison, you would be carrying out important duties of the Plan Coordinator while at the same time serving as a Borough official. Although the Commission does not specifically have the statutory jurisdiction to interpret whether the provisions of the Financially Distressed Richard A. McNulty July 16, 1991 Page 6 Municipalities Act which exclude elected or appointed officials of the municipality from serving as the plan coordinator would extend to you as the Borough's Act 47 Liaison, it is strongly recommended that you seek the advice of an attorney in this regard as well as regarding any restrictions the Borough Code may place upon you. 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 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 Borough Code or the Financially Distressed Municipalities Act, although you have been cautioned and advised to consult with an attorney regarding any and all restrictions those statutes may impose upon you with regard to the proposed conduct. Conclusion: As an elected Tax Collector for the Borough of Franklin, you are a "public official" subject to the provisions of the Ethics Law. As a public official /employee, you may, consistent with Section 3(a) of the Ethics Law, simultaneously serve in the positions of Tax Collector for Franklin Borough and the Act 47 Liaison for Franklin Borough. You are specifically cautioned and advised to seek the advice of an attorney regarding any restrictions pertaining to your proposed conduct under the Borough Code and under the Financially Distressed Municipalities Act. Lastly, the propriety of the proposed course of conduct has only been addressed under the Ethics Act. Pursuant to Section 7(9)(ii), 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 S2.12. Richard A. McNulty July 16, 1991 Page 7 Sincerely, V ncent . Dop o, Chief Counsel