HomeMy WebLinkAbout93-539 ConfidentialSTATE ETHICS COMMISSION
309 FINANCE BUILDING
P.O. BOX 11470
HARRISBURG, PA 17108 -1470
TELEPHONE (717) 783 -1610
ADVICE OF COUNSEL
April 2, 1993
93 -539
Re: Conflict, Public Official /Employee, Township Commissioner, Use
of Authority of Office or Confidential Information, Vote,
Private Employment or Business, Real Estate Broker, Sale to
Township.
This responds to your letter of March 6, 1993, 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 township
commissioner who is also a real estate broker with regard to the
prospective sale to the township of a commercial property for which
he has the "listing" and would be representing the seller.
Facts: As an elected Commissioner of Township A in County B,
Pennsylvania, you request an advisory from the State Ethics
Commission.
You have been a licensed real estate broker in the
Commonwealth of Pennsylvania since 1977. As such, you market real
estate on behalf of property owners in many parts of Pennsylvania,
including Township A. You recently entered into a listing
agreement with the owners of a commercial office building located
in the Township.
You state that both as a Township resident and as a Member of
the five- Member Board Commissioners of the Township, you are
- aware of the Board's ongoing public search for a solution to its
office space shortage. This search dates back to the late 1980's,
prior to your election as a Commissioner in 1991. Over that time,
the Board has considered several options to resolve the space
shortage, including the construction of a new facility on Township
land, the expansion of the existing facility, and the rental or
purchase of an existing facility from third persons.
In your opinion, the commercial office building for which you
have a listing agreement would, if acquired by the Township,
Confidential Advice 93 -539
April 2, 1993
Page 2
satisfactorily serve as offices for the Township and would solve
its office space shortage. In your capacity as real estate broker
for the owner, you intend to offer the building to the Township
government for purchase.
You believe several ethical issues are raised by the
foregoing.
As to Section 3(a) of the Ethics Law, you state that it
appears that, given your financial interest in the brokerage
listing agreement, a sale of the commercial building by the owner,
whom you represent, to the Township would be viewed as a "conflict
of interest" if you were to use the "authority of your office" as
a Commissioner to accomplish the sale. You assure this Commission
that you would abstain from voting on any official action to
acquire the building and in doing so would follow the procedures
set forth in Section 3(j) of the Ethics Law. You ask whether the
Township can acquire the commercial building where you act as real
estate broker on behalf of the owner, and whether your abstention
from voting pursuant to Section 3(j) is sufficient to avoid any
conflict of interest in connection therewith.
As to Section 3(f), you state your view that the contract
would be between the owner whom you represent and the Township, not
between the Township and you. You would act solely as the broker
for the owner and not as broker for the Township, and your
compensation for closing the transaction would be paid solely by
the owner and not by the Township. You ask whether the Township
can enter into a contract to acquire this commercial building where
you act as real estate broker on behalf of the owner, and whether
the fact that you are acting as broker, and not as a party, takes
your involvement beyond the scope of Section 3(f).
Finally, you request an advisory as to whether, under Section
3(j) of the Ethics Law, a member of a five member board, who has a
conflict, may vote to break a two to two tie vote.
Discussion: As a Township Commissioner for Township A, 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.
The following terms are defined in the Ethics Law as follows:
Confidential Advice 93 -539
April 2, 1993
Page 3
Section 2. Definit.ons.
"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 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 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.
"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,
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.
Confidential Advice 93 -539
April 2, 1993
Page 4
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.
Section 3(f) of the Ethics Law provides:
Section 3. Restricted activities
(f) No public official or public
employee or his spouse or child or any
business in which the person or his spouse or
child is associated shall enter into any
contract valued at $500 or more with the
governmental body with ..which the public
official or public employee is associated or
any subcontract valued at $500 or more with
any person who has been awarded a contract
with the governmental body with which the
public official or public employee is
associated, unless the contract has been
awarded through an open and public process,
including prior public notice and subsequent
public disclosure of all proposals considered
and contracts awarded. In such a case, the
public official or public employee shall not
have any supervisory or overall responsibility
for the implementation or administration of
the contract. Any' or subcontract
made in violation of this subsection shall be
voidable by a court of competent jurisdiction
if the suit is commenced within 90 days of the
making of the contract or subcontract.
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
Confidential Advice 93 -539
April 2, 1993
Page 5
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.
If a conflict exists, Section 3(j) requires the public
official /employee to abstain and to publicly disclose the
abstention and reasons for same, both orally and by filing 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. See, Mlakar, Advice 91-523 -
S.
In applying the -above provisions of the Ethics Law to the
_circumstances which you have submitted, pursuant to Section 3(a) of
the Ethics Law, a public official /public employee is prohibited
from using the authority of public office /employment or
confidential information received by holding such a public position
for the private pecuniary benefit of the public official /public
employee himself, any member of his immediate family, or a business
with which he or a member of his immediate family is associated.
You are advised that the term "use of authority of office"
encompasses more than the mere voting on an issue before the Board,
and encompasses all of the tasks needed to perform the functions of
a given position. See, Juliante, Order No. 809. A use of
Confidential Advice 93 -539
April 2, 1993
Page 6
authority of office therefore could include, for example,
participating in official discussions, lobbying for a particular
result, or exerting influence as a public official.
Under the circumstances which you have submitted, it is clear
that you would have a conflict of interest in your capacity as a
public official as to the proposed sale of real estate to the
Township where you hold the listing and would be representing the
seller as a real estate broker.
With regard to confidential information, it is noted that you
have represented and assured this Commission that the Township has
engaged in an "ongoing public search" for a solution to its office
space shortage, and thus, your recitation of the facts suggests
that your knowledge as to the needs of the Township is based upon
public knowledge. However, this Advice expressly assumes and is
conditioned upon the assumption that there would be no use of
confidential information received by being a Township Commissioner
as to the proposed transaction.
In this case, as in each instance of a conflict of interest
under the Ethics Law, you would be required to abstain from
participation in your capacity as a public official, and you would
further be required to fully comply with the disclosure
requirements of Section 3(j) as set forth above.
In response to your inquiry as to_whether the Township may
acquire the commercial building under these circumstances, you are
advised that the restrictions of Section 3(a) pertaining to
conflicts of interest restrict the conduct of the individual rather
than the governmental body itself.
Turning to your inquiry as to the restrictions of Section 3(f)
of the Ethics Law, you are advised that Section 3 {f) would not
apply in this case given that there would be no contract between
you and the governmental body, the Township.
Your final inquiry is with regard to Section 3(j) of the
Ethics Law, and specifically a situation in which one member of a
five member board would abstain due to a conflict and the remaining
four members would deadlock in a two to two tie vote. A clear
reading of Section 3(j) indicates that as to boards having more
than three members, public officials having conflicts could only
vote after necessary disclosure in cases where the conflicts of the
public officials under the Ethics Law-makes the majority (or other
legally required vote) unattainable. In this regard, Section 3(j)
is explicit in the condition that "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. . . ." Thus, in order for this provision to
Confidential Advice 93 -539
April 2, 1993
Page 7
be operative, it is necessary that a sufficient number of public
officials who have a •conflict under the Ethics Law would abstain so
that the majority or legally required vote could not be attained.
To be specific, in the case of a five member board, three public
officials would have to have a conflict under the Ethics Law in
order for this provision to become operative. The mere fact that
four members without a conflict would deadlock in a two to two tie
vote would not implicate Section'3(j) and would not authorize you
to vote as to the proposed sale of real estate to the Township as
to which you have a conflict of interest.
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 a Township Commissioner for Township A, you are a
public official subject to the provisions of the Ethics Law. Under
the facts which you have submitted, you would have a conflict of
interest in the matter of the proposed sale of a commercial
property to the Township as to which you have the listing and would
be representing the seller in your capacity as licensed real
estate broker. In each instance of a conflict of interest, you are
required to abstain from participation and to fully satisfy the
disclosure requirements of Section 3(j) of the Ethics Law set forth
above. As to governing bodies with more than three members,
Section 3(j) of the Ethics Law would only allow public officials
who have a conflict to vote after appropriate disclosure in those
instances where the number of the public officials who have a
conflict under Section 3(a) of the Ethics Law makes the majority or
other legally required vote of approval unattainable. 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
Confidential Advice 93 -539
April 2, 1993
Page 8
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.
cerely,
Vincent J. Dopko
Chief Counsel