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HomeMy WebLinkAbout94-519 WhitedSTATE ETHICS COMMISSION 309 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL March 4, 1994 Gerald L. Whited R.D. #1, Box 385 94 -519 Barnesboro, PA 15714 Re: Conflict of Interest, Public Official, Township Supervisor, Contracting with Governmental Body, Private Employment, Business with which Associated, Bid on Road Materials, Use of Personal Equipment, Compensation. Dear Mr. Whited: This responds to your letter of February 3, 1994, in which you requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Law presents any prohibition upon a Township Supervisor or a "business with which he is associated" from contracting with the Township for road materials and using personal excavation equipment. Facts: You are a Supervisor for Susquehanna Township, Cambria County. You are owner - operator of Whited Trucking. In previous years, you have hauled road materials for the township. The bids are sealed and you have no way of knowing the amount of any bid. You state that several taxpayers have indicated that they want you to submit a bid because the township is paying more now then when you hauled materials. You question whether such activity would be permittwd under the Ethics Law. In addition, you inquire as to whether if you can use your personal excavation equipment for township business, such as opening roads in winter or digging in summer, at competitive rates. Accordingly, you request an advisory from the State Ethics Commission as to the applicability of the Ethics Law to the above situations. Discussion: Before addressing the questions must be made. It is initially noted that 7(10) and 7(11) of the Ethics Law, 65 P advisories are issued to the requestor based raised, three points pursuant to Sections .S. S5407(10), (11), upon the facts which Whited, Gerald L., 94 -519 March 4, 1994 Page 2 the requestor has submitted. In issuing the advisory based upon the facts which the requestor has submitted, the Commission does not engage in an independent investigation of the facts, not does it speculate as to facts which have not been submitted. It is the burden of the requestor to truthfully disclose all of the material facts relevant to the inquiry. 65 P.S. SS407(10), (11). An advisory only affords a defense to the extent that the requestor has truthfully disclosed all of the material facts. It is further noted that your request for advice may only be addressed with regard to prospective conduct. A reading of Sections 7(10) and 7(11) of the Ethics Law makes it clear that an opinion or 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 or 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. Finally, it must be noted that the State Ethics Commission can address only the Ethics Law. Any question dealing with the interpretation of any other code, statute, ordinance or regulation, including the Second Class Township Code, is outside the jurisdiction of this Commission and cannot be addressed. As Supervisor for Susquehanna Township, Cambria County, you are a "public official" as that term is defined in the Ethics Law. 65 P.S. 5402; 51 Pa. Code S11.1. As such, you are subject to the provisions of the Ethics Law and the restrictions therein are applicable to you. Section 3(a) of the Ethics Law provides: Restricted Activities 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: "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 �r a member of his immediate family is associated. "Conflict" or "conflict of Whited, Gerald L., 94 -519 March 4, 1994 Page 3 Under Section 3(a) of the Ethics Law quoted above, a public official may not use the authority of office or confidential information to obtain a private pecuniary benefit for himself, a member of his immediate family or a business with which he is or a member of his immediate family is associated. Generally, the Ethics Law places no per se prohibition upon a public official or business with which he is associated from contracting with his governmental body. Pancoe, Opinion 89 -011. As owner- operator of Whited Trucking, it is clear that the foregoing entity is a "business with which you are associated" as that term is defined under the Ethics Law. Under Sections 3(a), you could not participate or vote on matters involving the contract between the government body and the "business with which you are associated." In addition, the requirements of Section 3(j) of the Ethics Law must be followed whereby the reasons for the abstention must be publicly noted as well as 4 written memorandum to that effect must be filed with the secretary recording the minutes. • Therefore, under Section 3(a), the "business with which you are associated" is not precluded from contracting with your governmental body but you could not participate or vote as to the matter of the contract and must comply with the disclosure requirements of Section 3(j) of the Ethics Law. 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. Whited, Gerald L., 94 -519 March 4, 1994 Page 4 Section 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. 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 contract 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. In relation to the above provision of law, the State Ethics Commission has generally determined that this provision is a procedure to be used when a public official or employee contracts with his own governmental body in an amount of $500 or more. The process must be open and public with prior public notice and subsequent public disclosure. In addition, the public official/ employee may not have any supervisory or overall responsibility for the implementation or administration of the contract. Thus, the open and public process, must be used in all situations where a public official is otherwise appropriately contracting with his own governmental body in an amount of $500 or more. This open and public process would require: (1) prior public notice of the employment or contracting possibility; Whited, Gerald L., 94 -519 March 4, 1994 Page 5 (2) sufficient time for a reasonable and prudent competitor /applicant to be able to prepare and present an application or proposal; (3) public disclosure of all applications or proposals considered and; (4) public disclosure of the contract awarded and offered and accepted. Further, Section 3(f) requires that the public official could not have supervisory or overall responsibility as to the implementation or administration of the contract. 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 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 Whited, Gerald L., 94 -519 March 4, 1994 Page 6 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 actions because of a majority is unattainable due to the abstention(s) from conflict under the Ethics Law, then in that event participation is permissible provided the disclosure requirements noted above are followed. See, Mlakar, Advice 91- 523 -S. Parenthetically, although the contracting in question would not be prohibited under the Ethics Law provided the requirements of Sections 3(a), (f) and (j) are satisfied, a problem may exist as to such contracting under the respective code. In the instant situation, the Second Class Township Code provides as follows: (f) Except as herein provided, no township official, either elected or appointed, who knows, or who by the exercise of reasonable diligence, could know, shall be interested to any appreciable degree, either directly or indirectly, in any contract for the sale or furnishing of any supplies or materials for the use of the township, or for any work to be done for such township involving the expenditure by the township of more than three hundred dollars ($300) in any year, but this limitation shall not apply to cases where such officer, or appointee of the township, is an employee of the person, firm or corporation to which the money is to be paid in a capacity with no possible influence on the transaction, and in which he cannot be possibly benefited thereby, either financially or otherwise: Provided, however, That in the case of -a supervisor, if he knows that he is within the exception just mentioned, he shall so inform the supervisors and shall refrain from voting on the expenditures, or any ordinance relating thereto, and shall in no manner participate therein: Provided, further, That any such official or appointee who shall knowingly violate this provision shall be subject to surcharge to the extent of the damage shown to be thereby sustained by the township, ouster from office, and shall be guilty of a misdemeanor, and upon conviction thereof, Whited, Gerald L., 94 -519 March 4, 1994 Page 7 shall be sentenced to pay a fine not exceeding five hundred dollars ($500): Provided, That in the case of the purchase of material for the construction, reconstruction, maintenance and improvement of roads and bridges, the contract, which shall be in writing, and shall be let only on standard specifications of the Department of Transportation, and materials so purchased shall only be used in accordance with specifications of said department. 53 P.S. S65802(f). Since such contracting may be prohibited by the above quoted provision of the Code, but not under the Ethics Law, it is suggested that advice in that regard be sought from the municipal solicitor or from private counsel. In responding to the question posed regarding the use of personal equipment, this advisory is limited to whether a supervisor may receive payment at competitive rates under the Ethics Law. Again, although the Commission does not have jurisdiction to interpret the Second Class Code, it is necessary in this case to review that law to the extent that it impacts upon the Ethics Law regarding the issue of whether a supervisor would be using the authority of office to obtain a private pecuniary benefit. The Second Class Township Code provides in part: . The compensation of supervisors, when acting as superintendents, roadmasters or laborers, shall be fixed by the township auditors either per hour, per day, per week, semi - monthly or monthly, which compensation shall not exceed compensation paid in the locality for similar services, and such other reasonable compensation for the use of a passenger car, or a two -axled four - wheeled motor truck having a chassis weight of less than two thousand pounds and a maximum gross weight of five thousand pounds, or a class 2 truck, having a maximum gross weight of seven thousand pounds when required and actually used for the transportation of road and bridge laborers and their hand tools and for the distribution of cinders and patching materials from a stock pile, as the auditors shall determine and approve; but no supervisor shall receive compensation as a superintendent or roadmaster for any time he spends attending a meeting of supervisors." Whited, Gerald L., 94 -519 March 4, 1994 Page 8 53 P.S. 565515(a). As to the provisions of the Ethics Law, a supervisor could receive compensation as to the use of private equipment only to the extent allowable by law. As to the use of their personal equipment, supervisors would be entitled to compensation under the Ethics Law provided the equipment is within the categories specified by the Second Class Township Code and provided "the auditors shall determine and approve ". The foregoing is a function of the auditors. It is not the function of the State Ethics Commission to usurp the statutory duties of the township auditors. Dice, Opinion 85 -021. Therefore, to the extent that the compensation is allowable under the Second class township code and is approved by the auditors, the Ethics Law would not prohibit the receipt of such compensation. Means, Opinion 90 -007, Courter, Opinion 93 -001. Lastly, 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 in this advice is the applicability of the respective code. Conclusion: As a Supervisor for Susquehanna Township, Cambria County, you are a public official subject to the provisions of the Ethics Law. Under Section 3(a) of the Ethics Law, a public official /employee or a "business with which you are associated" may contract with the governmental body but could not vote or participate in the matter of the contract. The disclosure requirements of Section 3(j) outlined above must be observed. Finally, if the contract is $500 or more, the open and public process as outlined above must be accomplished. The public official /employee could not have any supervisory or overall responsibilities as to the contract. Due to the possible application of the above referenced code in this matter, it is suggested that advice be obtained from the municipal solicitor or private counsel in that regard. As to the use of your equipment, you could be compensated for the use of your personal equipment to the extent that the equipment is within the types authorized by the Second Class Township Code and approved by the auditors. 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 Whited, Gerald L., 94 -519 March 4, 1994 Page 9 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 appeal the Advice to the full Commission. A personal appearance before the Commission will be scheduled and a formal Opinion will be issued by the Commission. Any such appeal must be in writing and must be actually received at the Commission within fifteen (15) days of the date of this Advice pursuant to 51 Pa.Code §13.2(h). The appeal may be received at the Commission by hand delivery, United States mail, delivery service, or by FAX transmission (717- 787 - 0806). cerely, Vincent- J. Dopko Chief Counsel