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Home My WebLink About97-524 BallardCharles H. Ballard Box 4498 Allentown, PA 18105 -4498 Dear Mr. Ballard: STATE ETHICS COMMISSION 309 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 1 71 08 -1 470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL February 13, 1997 97 -524 Re: Conflict, Public Official /Employee, School District, School Director, Business With Which Associated, Public Utility, Employee, Deregulation, Voting. This responds to your letter of January 14, 1997 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 School Director, who is also employed by a Public Utility which currently provides electricity to the School District, as to voting to choose an electric supplier following public utility deregulation or to pay the utility bills of the Public Utility that employs him. Facts: You are the School Director for the East Penn School District (District). You are also employed by a Public Utility which supplies the electric power to the District as a state - regulated monopoly. You have been advised that voting to approve uncontested electric utility bills as part of the general bill list does not present a conflict for you. You state that deregulation of the choice of electric supplier will occur in Pennsylvania with trials possibly starting in April, 1997. You indicate your belief that voting to choose an electric supplier would be a conflict of interest for you even if there are separate Generation and Distribution companies under one holding company umbrella, regardless of which company employs you. Your specific inquiry is whether it would be a conflict of interest for you in the future, if the choice of electric supplier has been made separately, to approve electric utility bills for payment if you remain an employee of an actual or potential electric supplier to the District. Discussion: It is initially noted that pursuant to Sections 7(10) and 7(11) of the Ethics Law, 65 P.S. §§407(10), (11), advisories are issued to the requestor based upon the facts which 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, nor does it speculate as to facts which have not been submitted. It is the burden of the requestor to truthfully disclose all of the Ballard, 97 -524 February 13, 1997 Page 2 material facts relevant to the inquiry. 65 P.S. §§407(10), (11). An advisory only affords a defense to the extent the requestor has truthfully disclosed all of the material facts. As a School Director for East Penn 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. 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 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. 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. Ballard, 97 -524 February 13, 1997 Page 3 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 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) from conflict under the Ethics Law, then in that event voting is permissible provided the disclosure requirements noted above are followed. See, Mlakar, Advice 91- 523 -S. In applying the provisions of Section 3(a) of Act 9 of 1989 to the instant matter, you are correct that you would have a conflict in participating as to the selection of a new electric utility provider if the utility by which you are employed seeks to provide such service. As to whether you may vote to approve utility electric bills as part of a general bills list if the electric utility with which you are associated is selected to provide service to the School District, that question has been addressed by the Commission in Krushinski, Order 168. The Commission concluded in Krushinski, supra, that a public official may vote to approve bills of a business with which he is associated that are submitted for payment provided the bills are pre- determined, routine, and are not contested. An example of pre - determined bills would be those that are not negotiated such as the price of paper /pencils. An example of routine bills would be telephone bills. Finally, non - contested bills are those that do not Ballard, 97 -524 February 13, 1997 Page 4 involve any dispute as to services provided or the amount of the bill. Assuming that the electric utility bills meet the criteria as set forth in the Krushinski decision, you may under Section 3(a) of the Ethics Law vote to approve pre- determined, routine, non - contested utility electric bills from a utility by which you are employed. 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 Public School Code. Conclusion: As a School Director for East Penn School District, you are a public official subject to the provisions of the Ethics Law. A School Director may under Section 3(a) of the Ethics Law vote to approve pre- determined, routine, non - contested utility electric bills from a utility by which he is employed. 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. 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 thirty (30) 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). Failure to file such an appeal at the Commission within thirty (30) days may result in the dismissal of the appeal. cerely, Vincent J. op • Chief Counsel