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HomeMy WebLinkAbout92-662v• 1 1 STATE ETHICS COMMISSION 309 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 1 71 08 -1 470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL December 31, 1992 92 -662 Re: Conflict, Public Official /Employee, Simultaneous Service, Member of County Redevelopment Authority and Member of City Redevelopment Authority, Sale of Facility by County Redevelopment Authority to City Redevelopment Authority. This responds to your letters of October 22, 1992, November 24, 1992, and December 3, 1992, 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 member of a county redevelopment authority from also serving as a member of a city redevelopment authority, specifically with regard to the prospective sale of a facility by the county redevelopment authority to the city redevelopment authority. Facts: As the Solicitor for County A, you request an advisory from the State Ethics Commission on behalf of an individual who simultaneously serves as a Member of County Redevelopment Authority B and City Redevelopment Authority C. You note that both of the aforesaid Redevelopment Authorities are located in County A. Currently, County Redevelopment Authority B is the owner of a facility which is leased to the other Redevelopment Authority, City Redevelopment Authority C, for industrial development. This particular facility is the subject of a study being undertaken by County Redevelopment Authority B which could result in the sale of the facility to City Redevelopment Authority C. You pose the following specific question: What prohibitions, if any, apply to an individual who serves as a voting member of a County Redevelopment Authority and a City Redevelopment Authority with respect to matters involving potential contractual arrangements between those two entities? You specifically inquire whether this particular Member of the Confidential Advice No. 92 -662 December 31, 1992 Page 2 County Redevelopment Authority would have a conflict of interest under the Ethics Law in the event the Member engaged in discussions, negotiations or ultimately voting upon matters involving the sale or lease of real estate to the City Redevelopment Authority which he also serves as a voting Member. This individual is also concerned as to whether he is subject to a conflict of interest by serving on both of these Redevelopment Authorities. You state your understanding of the Ethics Law as being that this individual who serves on both Authorities must: a) disclose during the course of any public meetings of both entities his potential conflict of interest; and b) refrain from taking part in any discussions relative to a potential contract between these two entities and ultimately abstain from any votes which impact upon these matters. You ask whether your above analysis is correct. Finally, you note the significance of this project, as well as the concern that the Ethics Law not be transgressed. Discussion: In each of his capacities as a Member of County Redevelopment Authority B and City Redevelopment Authority C, the individual on whose behalf you inquire is a public official as that term is defined under the Ethics Law, and hence that individual 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 Confidential Advice No. 92 -662 December 31, 1992 Page 3 general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of 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. 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 anything 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 been or will be any transgression thereof but merely to provide a complete response to the question presented. Turning to your specific inquiries, the question of simultaneous service shall first be addressed. A review of the Urban Redevelopment Law, 35 P.S. S1701, et sea., fails to reveal any provision declaring the position of a member of a county redevelopment authority to be incompatible with the position of a member of a city redevelopment authority. In applying the above provisions of the Ethics Law to the question of simultaneous service, there does not appear to be any restriction precluding simultaneous service in these capacities. First, it is difficult to imagine a private pecuniary benefit arising merely as a result of the simultaneous service, because neither of these positions is compensated. 35 P.S. §1706. Second, as for inherent incompatibility, 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 inherently adverse. Smith Opinion, 89 -010. In the situation outlined above, the individual on whose behalf you inquire would not be serving entities with interests which are inherently adverse to each other. City and county redevelopment authorities are deemed to be agencies of the Commonwealth. 35 P.S. S1709. Thus, in each of his capacities, the individual on whose behalf you inquire is serving a Commonwealth agency. Confidential Advice No. 92 -662 December 31, 1992 Page 4 Particular matters of contention may arise between these redevelopment authorities, perhaps even as to the proposed sale of this facility, but the possibility that occasional adversities may arise does not present an inherent adversity which could preclude simultaneous service. Your remaining specific inquiry asks whether this individual who simultaneously serves on both the city and county redevelopment authorities would have a conflict of interest under the Ethics Law in matters involving potential contractual arrangements between the entities, such as the proposed sale of a facility by one to the other. The necessary conclusion is that this individual would not have a conflict of interest under the Ethics Law as to such matters, because the requisite element of a private pecuniary benefit would be lacking. As noted above, neither of these positions is compensated. Furthermore, redevelopment authority members are not personally liable on the bonds or other authority obligations. 35 P.S. §1707. However, the above conclusion that a conflict of interest would not exist under the Ethics Law should not be construed to be a blanket approval of this individual's participation in matters involving both authorities. A concern is noted that members of redevelopment authorities appear to be considered fudiciaries. See, 20 Pa.C.S. §7301, et seq. It is recommended that this individual secure the advice of legal counsel with regard to his responsibilities to each authority under other laws. It may well be that the better course of action would be for this individual to abstain from matters involving both authorities, even though such abstention would not be required by 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. Conclusion: In each of his capacities as a Member of County Redevelopment Authority B and City Redevelopment Authority C, the individual on whose behalf you inquire is a public official subject to the provisions of the Ethics Law. The said individual may, consistent with Section 3(a) of the Ethics Law, simultaneously serve as a Member of the aforesaid County Redevelopment Authority and City Redevelopment Authority. Section 3(a) of the Ethics Law would not restrict said individual from participating in discussions, negotiations, or voting upon matters involving the sale or lease of real estate by the County Redevelopment Authority to the City Redevelopment Authority. It is recommended that this individual secure the advice of legal counsel with regard to his responsibilities to each authority under other laws. Lastly, the Confidential Advice No. 92 -662 December 31, 1992 Page 5 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 and must be received at the Commission within 15 days of the date of this Advice pursuant to 51 Pa. Code §2.12. Sincerely, Vincent . Dopko Chief Counsel