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HomeMy WebLinkAbout91-562 MerrittMr. Kevin G. Merritt Box 12 Erie Street Venango, PA 16440 Dear Mr. Merritt: STATE ETHICS COMMISSION 309 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL July 29, 1991 91 -562 Re: Conflict, Public Official /Employee, School Director, Chairman of Subcommittee Regarding Food Service Operations, Vote, Private Employment or Business, School Director Employed By Baking Company Which Does Not Service School District. This responds to your letter of June 5, 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 you as a School Director with regard to serving as the Chairman of a subcommittee on the cafeteria food service operations and /or regarding voting on food service where you are employed by Schwebels Baking Company, which does not service the School District. Facts: You have submitted a four page letter together with approximately 45 pages of attachments, which attachments are incorporated herein by reference, in which you request the advice of this Commission. The following summarizes the substance of the facts which you have submitted. You are a member of the Board of Eduction for the Penncrest School District, and you are privately employed by Schwebels Baking Company. Your inquiry focuses upon your position as a School Director with regard to the School District's food service contract with Morrison's Custom Management Company of Mobile, Alabama. You have provided a detailed history of your concerns with the contract with Morrison's, which concerns regarded the quality of the food being served, staffing, the accuracy of financial reports, and repeated financial losses generated by the food service operations. Your involvement as a School Director included directly investigating your concerns. You met personally with the food service director about your concerns on December 26, 1990. The Mr. Kevin G. Merritt July 29, 1991 Page 2 director told you that her boss had said that if it was going to . be a problem then the food service would buy from Schwebels, your employer, instead of Stroehman. You replied that your concerns were not over the prices of the bread but rather over the debts that the board continued to see year after year. Subsequently, you personally visited the kitchens to view the labor situation. You were ultimately appointed as Chairman of a subcommittee appointed by the Board to look into the cafeteria situation. The subcommittee met on several occasions and then recommended the re- bidding of the food service operations. On March 14, 1991, the board voted to uphold your subcommittee's recommendation to rebid the food service operations. On March 26, 1991, you advise that you received a telephone message at your place of employment from Bert Gilson, Agency Manager of Schwebels Baking Company, Erie Division. In a conversation with Mr. Gilson later that day, you state that Mr. Gilson said he wanted to know what was going on in Penncrest with the food service program. You started to tell him and then questioned him as to why he wanted to know. You state that Mr. Gilson told you that a Morrison's employee telephoned the Pittsburgh Accounts Manager for Schwebels and wanted to know what a Schwebels' employee, who is also a member of the Penncrest School Board, was doing. That employee is alleged to have stated that if Schwebels wanted the business, all they had to do was ask for it. You were informed that further discussion took place as to the amount of business that Morrison's and Schwebels does in other areas, such as in Cleveland, Pittsburgh and in Erie at Gannon University. You state that you were then informed that it was made quite clear that Schwebels could lose some business because of a dissenting vote against Morrison's. You state that you were then asked by Mr. Gilson to "back off" or at least "get out of the picture," and were told that maybe you should not be so vocal about the matter. Your response was that the fact that someone called Schwebels gave you reason to believe there was something they did not want you to find out or to tell the board, and that they believed by having your employer put pressure on you, you would convince the board to let Morrison's win the contract. You report that Mr. Gilson went on to say that the "bottom line" from this could be your employment. That evening, you telephoned the District Superintendent and informed him of this matter. You subsequently telephoned various individuals from Schwebels, and you were informed that Mr. Gilson had been told to leave the matter alone and that your personal life should be no concern of Schwebels. You were told that you had nothing to fear and that Mr. Gilson could not fire you for something you were doing on your own time that had nothing to do with Schwebels. Mr. Kevin G. Merritt July 29, 1991 Page 3 You received another telephone call from Mr. Gilson who told you that the gist of his conversation with you two days earlier was not to mean that your employment was in jeopardy. He further stated that if you were going to be fired, it would be for another reason rather than loss of business. You responded that if you were fired in two days, two weeks or even two months, you would have to look and see whether Schwebels lost any business with Morrison's. That evening you contacted the School District's Solicitor about the situation. He has advised you to remove yourself as Chair of the subcommittee and not to be involved in the selection of a food service company. He has provided you with a written opinion which you have submitted. Attorney Watts' opinion recognizes that, "...any attempt by Morrison's to interfere with Mr. Merritt's employment as a consequence of his activity as a public official would contravene the Ethics Act." (Memorandum of Theodore H. Watts, Esquire, May 16, 1991, at 2.) However, Attorney Watts further opines that because someone attempted to influence the Penncrest investigation by pressuring your employer, questions could arise regarding your official actions regardless of which way you would vote. If you voted for Morrison's such a vote might be "as a result of fear of reprisal," and a vote against Morrison's might be deemed "retribution" against Morrison's for making such a threat . . ." Id. at 3. Finally, Attorney Watts' Opinion focuses upon avoiding not only evil but "the appearance of evil ". Id. at 3 -4. You now seek the advice of the State Ethics Commission on this matter. Your inquiry appears to focus on whether you can be the Chair or serve on the subcommittee involved in the selection of a food service company, and whether you can participate or vote on selecting a food service company. You state that you feel that your intentions were to find out why the school district was losing money, not to win a bread contract. You also question why a company that has attempted what you deem to be fraudulent activities should be allowed to rebid on the contract. You feel that if you are penalized for doing what you thought was right, then such a company should not be allowed to bid. You conclude by referencing the documents which you have enclosed as showing that you were doing what an elected official should be doing as a watchdog for the taxpayers' money. You state that the bids have not yet been awarded, but it looks like Morrison's may be a finalist. Mr. Kevin G. Merritt July 29, 1991 Page 4 Discussion: It is initially noted that this advice is issued . strictly and solely with regard to prospective action and any past action is not considered. Furthermore, a reading of Sections 7(10) and (11) of the Ethics Act makes it clear than an opinion /advice may be given only as to prospective (future) conduct. If the activity in question has already occurred, the Commission may not issue an opinion /advice but any person may then submit a signed and sworn complaint which will be investigated by the Commission if there are allegations of Ethics Law violations by a person who is subject to the Ethics Law. It is clear that there has been extensive past action which is expressly not considered herein. This advice is based solely on prospective facts which you have submitted to this Commission, regarding your prospective conduct of continuing to serve as Chair or a member of the subcommittee on food service and /or participating and voting in selecting a food service company. Nevertheless, if others have indeed offered to give to you as a public official anything of monetary value - even continued employment at Schwebels - based on the understanding that your vote, official action or judgment would be influenced thereby, such conduct would transgress Section 3(b) and /or 3(c) of the Ethics Law. 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 anything of monetary value based upon the understanding that the vote, official action, or judgement of the public official /employee would be influenced thereby. We must express a grave concern about the conduct you have described, even though past conduct and specifically the conduct of those individuals alleged to be involved is not before the Commission in this Advice. Turning to your prospective conduct which is the only matter before us in this Advice, it is clear that as a School Director for the Penncrest School District, you are a public official as that term is defined under the Ethics Law, and hence you are 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. Mr. Kevin G. Merritt July 29, 1991 Page 5 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. "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. "Contract." An agreement or arrangement for the acquisition, use or disposal by the Commonwealth or a political subdivision of consulting or other services or of supplies, materials, equipment, land or other personal or real property. "Contract" shall not mean an agreement or arrangement between the State or political subdivision as one party and a public official or public employee as the other party, concerning his expense, Mr. Kevin G. Merritt July 29, 1991 Page 6 reimbursement, salary, wage, retirement or other benefit, tenure or other matters in consideration of his current public employment with the Commonwealth or a political subdivision. In applying the above provisions of the Ethics Law to your prospective conduct of continuing to serve as Chair or a member of the subcommittee on the food service operations and /or participating and voting to select a food service company, such conduct would not constitute a conflict of interest under the Ethics Law under the circumstances which you have presented. Your prospective conduct would not result in a private pecuniary benefit for you, any member of your immediate family, or a business with which you are associated. Clearly, Morrison's Custom Management Company is not a business with which you or any of your immediate family members are associated under the facts which you have submitted and under the definition set forth above. Additionally, there would be no private pecuniary benefit for you if you vote in the public's interest. We disagree with the reasoning of the School District's Solicitor. A forced abstention of a public official solely because he alleges that others have improperly attempted to influence him, would be more likely to serve the interests of those alleged to have acted improperly than the interest of the public. Furthermore, the present Ethics Law, Act 9 of 1989, prohibits conduct which constitutes a conflict of interest but does not address the "appearance of a conflict." Thus, based upon the facts which you have submitted, your prospective conduct in continuing to serve as the Chair or a member of the subcommittee on food service and in participating or voting as a School Director to select a food service operation would not constitute a conflict of interest under the Ethics Law. Schwebels Baking Company is a business with which you are associated as defined under the Ethics Law. Therefore, under Section 3(a) of the Ethics Law, you could not use the authority of your public office or confidential information obtained by holding public office to obtain a private pecuniary benefit for Schwebels Baking Company. However, Schwebels Baking Company does not presently service Penncrest School District for Morrison's, nor does it appear that such a relationship could be reasonably and legitimately anticipated of being developed after such a vote. See, Amato, Opinion 89 -002 and authorities cited therein. In this case, it appears that your participation or vote as a School Director and /or as the Chair or member of the Mr. Kevin G. Merritt July 29, 1991 Page 7 subcommittee involved in selecting a food service company would, as in Amato, supra, fail to have any legitimate direct effect upon a subcontract being awarded to your employer. Thus, in the absence of any express understandings which would violate Section 3(b) or Section 3(c) of the Ethics Law, your prospective conduct could not reasonably anticipate a subcontract being awarded to your employer under the facts which you have submitted. However, should future circumstances change such that a financial relationship would exist or could be reasonably and legitimately anticipated of being developed between the food service company chosen to service Penncrest School District and your employer, a conflict would exist under those circumstances, and you would be required to abstain from any participation and from voting in the matter. 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 Mr. Kevin G. Merritt July 29, 1991 Page 8 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 to abstain as well as to publicly, orally announce and file a written memorandum to that effect with the person recording the minutes. 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 School Code. Conclusion: As a School Director for the Penncrest School District, you are a public official subject to the provisions of the Ethics Law. With regard to your prospective conduct only and subject to the conditions noted above, your prospective conduct of participating and voting to select a food service company in your capacities as a School Director and Chair of the subcommittee on food service operations would not constitute a conflict of interest under the facts which you have presented. In the future, if a financial relationship between your employer and the food service company selected by the Board should exist or could be reasonably and legitimately anticipated of being developed you would have a conflict of interest and would be required to abstain from any participation or vote in any related matter. If such a conflict of interest should arise, you must comply with the disclosure provisions of Section 3(j) of the Ethics Law set forth above. 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 Commission will be issued. Any such appeal must be in writing Mr. Kevin G. Merritt July 29, 1991 Page 9 and must be received at the Commission within 15 days of the date of this Advice pursuant to 51 Pa. Code 52.12. Sincerely, vvt),A, 1 Vincent J. Dopko, Chief Counsel