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To the Requester:
Ms. Stacy Stone
Dear Ms. Stone:
STATE ETHICS COMMISSION FACSIMILE: 717-787-0806
FINANCE BUILDING WEBSITE: wwmethics.oa.00v
613 NORTH STREET, ROOM 309
HARRISBURG, PA 17120-0400
ADVICE OF COUNSEL
February 14, 2020
20-504
This responds to your letter dated December 20, 2019, by which you requested
an advisory from the Pennsylvania State Ethics Commission ("Commission").
Issue: Whether the Public Official and Employee Ethics Act ("Ethics Act"), 05
ITS. § 1101 et seq., would impose prohibitions or restrictions upon an individual
serving as a school (rector with regard to voting to approve the school district check
register, where: (1) in a private capacity, the individual is employed with a company that
has a contract to provide paraprofessionals, teacher assistants, and aides to the school
district; (2) the contract between the school district and the company was entered into
before the individual was elected as a school director; and (3) the school district check
register includes payments to the company pursuant to the contract between the school
district and the company.
Facts: You request an advisory from the Commission based upon submitted
ac s 1hat may be fairly summarized as follows.
In November 2019, you were elected as a School Director for the
Tredyffrin/Easttown School Disrict ("School District"). A company named °ESS Support
Services, LLC" (the "Company") has a contract (the "Contract") with the School District
for the provision of paraprofessionals, teacher assistants, and aides. The Contract was
entered into before you were elected as a School Director for the School District.
Payments made by the School District to the Company pursuant to the Contract are
included in the School District check register, which is presented periodically to the
School District School Board for approval. The School District School Board's approval
of the School District check register authorizes the School District Business Office to
issue payment(s) to the Company under the Contract.
In a private capacity, you are employed with the Company. You state that you
are not assigned to work In the School District and that you would not accept an
assignment to work in the School District.
Based upon the above submitted facts, you ask whether you would have a
conflict of interest with regard to voting to approve the School District check register
when it would include payment(s) to the Company pursuant to the Contract, or whether
Stone, 20-504
aruary 14, 2020
Page 2
the "class/subclass" exclusion set forth within the Ethics Act's definition of "conflict" or
"conflict of interest" would be applicable as to such votes.
Discussion: It is initially noted that pursuant to Sections 1107(10) and 1107(11) of
e Ethics -Act, 65 Pa.C.S. §§ 1107(10), (11), advisories are issued to the requester
based upon the facts that the requester has submitted. In issuing the advisory based
upon the facts that the requester has submitted, the Commission does not engage in an
independent investigation of the facts, nor does it speculate as to facts that have not
been submitted. It is the burden of the requester to truthfully disclose all of the material
facts relevant to the inquiry. 65 Pa.C.S. §§ 1107(10}, (11). An advisory only affords a
defense to the extent the requester has truthfully discllosed all of the material facts.
As a School Director for the School District, you are a public official subject to the
provisions of the Ethics Act.
Sections 1103(a) and 11030) of the Ethics Act provide:
§ 1103. Restricted activities
(a) Conflict of interest. --No public official or public
employee shall engage in conduct that constitutes a conflict
of interest.
0) Voting conflict. --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
pprovided 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.
65 Pa.C.S. §§ 1103(a), 0).
The following terms related to Section 1103(a) are defined in the Ethics Act as
follows:
§ 1102. 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
Stone, 20-504
FeE—ruary 14, 2020
Page 3
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. The term 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." Any corporation, partnership, sole
proprietorship, firm, enterprise, franchise, association,
organization, self-employed individual, holding company,
joint stock company, receivership, trust or any legal entity
organized for profit.
"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.
65 Pa.C.S. § 1102.
Subject to the statutory exclusions to the Ethics Act's definition of the term
it or "conflict of interest," 65 Pa.C.S. § 1102, 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.
The use of authority of office is not limited merely to voting, but extends to any
use of authority of office including, but not limited to, discussing, conferring with others,
and lobbying for a particular result. Juliante, Order 809.
In each instance of a conflict of interest, a public official/public employee would
be required to abstain from participation, which would include voting unless one of the
statutory exceptions of Section 11030) of the Ethics Act would be applicable.
Additionally, the disclosure requirements of Section 11030) of the Ethics Act would have
to be satisfied in the event of a voting conflict.
A conflict of interest would not exist to the extent the "de minimis exclusion"
and/or the "class/subclass exclusion" set forth within the Ethics Act's definition of the
term "conflict" or "conflict of interest," 65 Pa.C.S. § 1102, would be applicable.
The de minimis exclusion precludes a finding of conflict of interest as to an action
having a de minimis (insignificant) economic impact. Thus, when a matter that would
otherwise constitute a conflict of interest under the Ethics Act would have an
insignificant economic impact, a conflict would not exist and Section 1103(a) of the
Ethics Act would not be implicated. See, Kolb, Order 1322; Schweinsburg, Order 900.
Stone, 20-604
e ruary 14, 2020
Page 4
In order for the class/subclass exclusion to apply, two criteria must be met: (1)
the affected public official/public employee, immediate family member, or business with
which the public officiallpublic employee or immediate family member is associated
must be a member of a class consisting of the general public or a true subclass
consisting of more than one member; and (2) the public officiallpublic employee,
immediate family member, or business with which the public official/public employee or
immediate family member is associated must be affected "to the same degree" (in no
way differently) than the other members of the class/subclass. 65 Pa.C.S. §� 1102; see,
Kablack, Opinion 02-003; Rubenstein, Opinion 01-007. The first criterion of the
ex�ion is satisfied where tie members of the proposed subclass are similarly
situated as the result of relevant shared characteristics. The second criterion of the
exclusion is satisfied where the individual/business in question and the other members
of the class/subclass are reasonably affected to the same degree by the proposed
action. Kablack, supra.
Section 1103(f) of the Ethics Act, pertaining to contracting, provides as follows:
§ 1103. Restricted activities
(f) Contract. --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.
65 Pa.C.S. § 1103(f).
The term "contract" is defined in the Ethics Act as follows:
§ 1102. Definitions
"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. The term 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.
65 Pa.C.S. § 1102.
Stone, 20-504
February 14, 2020
Page 5
Section 1103(f) does not operate to make contracting with the governmental
body permissible where it is otherwise prohibited. Rather, where a public official/public
employee, his spouse or child, or a business with which he, his spouse or child is
associated, is otherwise appropriately contracting with the governmental body, or
subcontracting with any person who has been awarded a contract with the
governmental body, in an amount of $500.00 or more, Section 1103(f) requires that an
open and public process" be observed as to the contract with the governmental body.
Section 1103(f) of the Ethics Act also provides that the public official/public employee
may not have any supervisory or overall responsibility as to the implementation or
administration of the contract with the governmental body.
It is administratively noted that the Public School Code provides in part:
§ 3-324. Not to be employed by or do business with
district; exceptions
(a) No school director shall, during the term for which he
was elected or appointed, as a private person engaged in
any business transaction with the school district in which he
is elected or appointed, be employed in any capacity by the
school district in which he is elected or appointed, or receive
from such school district any pay for services rendered to the
district except as provided in this act...
(c) It shall not be a violation of this section for a school
district to contract for the purchase of goods or services from
a business with which a school director is associated to the
extent permitted by and in compliance with 65 Pa.C.S. Ch.
11 (relating to ethics standards and financial disclosure).
24 P.S. § 3-324(a), (c). On its face, Section 3-324(c) of the Public School Code permits
contracting between school districts and businesses with which school directors are
associated as long as the requirements of the Ethics Act are observed.
In ap lying the above provisions of the Ethics Act to the instant matter, you are
advised as follows.
The Company is a business with which you are associated in your capacity as an
employee. Subject to the statutoryry exclusions to the definition of "conflict" or "conflict of
interest" as set forth in Section 1102 of the Ethics Act, 65 Pa.C.S. § 1102, pursuant to
Section 1103(a) of the Ethics Act, you would have a conflict of interest as a School
Director in matters that would financially impact you or the Company.
You generally would have a conflict of interest under Section 1103(a) of the
Ethics Act with regard to matter(s) pertaining to the Company or the Contract, including
but not limited to overseeing work performed b the Company relative to the Contract or
participating in matter(s) involving extensions)Irenewal(s) of the Contract or future
contract(s) between the School District and the Company.
You specifically would have a conflict of interest with regard to voting to approve
the School District check register —when it would include payment(s) to the Company
pursuant to the Contract --unless the de minimis exclusion to the definition of "conflict'
or "conflict of interest," 65 Pa.C.S. § 1102, would be applicable. There is no basis in the
submitted facts upon which to conclude that the de minimis exclusion would be
applicable.
Stone, 20-504
.ary 14, 2020
Page 6
The class/subclass exclusion to the definition of "conflict" or "conflict of interest,"
65 Pa.C.S. § 1102, would not be applicable because the Company would not be part of
a subclass of similarly situated companies/businesses that would be affected to the
"same degree" by the School District School Board's approval of the School District
check register.
In each instance of a conflict of interest, you would be required to abstain from
participation, which would include voting unless one of the statutory exceptions of
Section 11030) of the Ethics Act would be applicable. Additionally, the disclosure
requirements of Section 11030) of the Ethics Act would have to be satisfied in the event
of a voting conflict.
It is noted that the restrictions and requirements of Section 1103(f) of the Ethics
Act would have to be observed whenever applicable. Section 1103( would not be
applicable to the Contract given that the Contract was not entered into at a time when
you were serving as a School Director. Cf., Nickel, Advice 20-502; Wiley, Advice 18-
501. However, any extension(s)/renewal'(s of the Contract or of ture contract(s)
between the School District and the Company valued at $500.00 or more would be
subject to the restrictions and requirements of Section 1103(f) of the Ethics Act to the
extent that: (1) you would be a School District School Director; and (2) the Company
would remain a business with which you are associated.
The propriety of the proposed conduct has only been addressed under the Ethics
Act; the applicability of any other statute, code, ordinance, regulation or other code of
conduct otther than the Ethics Act has not been considered in that they do not involve an
interpretation of the Ethics Act.
Conclusion: Based upon the submitted facts that: (1) in November 2019, you
were eelected as a School Director for the Tredyffrin/Easttown School District ("School
District"�; {2) a company named "ESS Support Services, LLC" (the "Company ) has a
contrac (thhe "Contract") with the School District for the provision of paraprofessionals,
teacher assistants, and aides (3) the Contract was entered into before you were
elected as a School Director for the School District; (4) payments made by the School
District to the Company pursuant to the Contract are included in the School District
check register, which is presented periodically to the School District School Board for
approval; (5) the School District School Board's approval of the School District check
register authorizes the School District Business Office to issue payments) to the
Company under the Contract; (6) in a private capacity, you are employedd with the
Company; and (7) you are not assigned to work in the School District, and you would
not accept an assignment to work in the School District, you are advised as follows.
As a School Director for the School District you are a public official subject to the
provisions of the Public Official and Employee Ethics Act ('Ethics Act"), 65 Pa.C.S. §
1101 et seg. The Company is a business with which you are associated in your
capacity as an employee. Subject to the statutory exclusions to the definition of
"conflict" or "conflict of interest" as set forth in Section 1102 of the Ethics Act, 65 Pa.C.S.
§ 1102, pursuant to Section 1103(a) of the Ethics Act, you would have a conflict of
interest as a School Director in matters that would financially impact you or the
Company.
You generally would have a conflict of interest under Section 1103(a) of the
Ethics Act with regard to matter(s) pertaining to the Company or the Contract, including
but not limited to overseeing work performed b the Company relative to the Contract or
participating in matters} involving extensions)lrenewal(s) of the Contract or future
contracts) between the School District and the Company.
You specifically would have a conflict of interest with regard to voting to approve
the School District check register —when it would include payment(s) to the Company
Stone, 20-504
Fel3ruary 14, 2020
Page 7
pursuant to the Contract —unless the de minimis exclusion to the definition of "conflict"
or "conflict of interest," 65 Pa.C.S. § 1102, would be applicable. There is no basis in the
submitted facts upon which to conclude that the de minimis exclusion would be
applicable.
The class/subclass exclusion to the definition of "conflict" or "conflict of interest,"
65 Pa.C.S. § 1102, would not be applicable because the Company would not be part of
a subclass of similarly situated companies/businesses that would be affected to the
"same degree" by the School District School Board's approval of the School District
check register.
In each instance of a conflict of interest, you would be required to abstain from
participation, which would include voting unless one of the statutory exceptions of
Section 11030) of the Ethics Act would be applicable. Additionally, the disclosure
requirements of Section 11030) of the Ethics Act would have to be satisfied in the event
of a voting conflict.
The restrictions and requirements of Section 1103(f) of the Ethics Act would have
to be observed whenever applicable. Section 1103(f) would not be applicable to the
Contract given that the Contract was not entered into at a time when you were serving
as a School Director. However, any extension(s)/renewal(s) of the Contract or future
contract(s) between the School District and the Company valued at $500,00 or more
would be subject to the restrictions and requirements of Section 1103(f) of the Ethics
Act to the extent that: (1) you would be a School District School Director; and (2) the
Company would remain a business with which you are associated.
Lastly, the propriety of the proposed conduct has only been addressed under the
Ethics Act.
Pursuant to Section 1107(11) of the Ethics Act, an 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, provided the requester 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 writingg and must be act_ua�ll
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
Me such an appeal at the Commission within thirty (30) days may
result in the dismissal of the appeal.
Sincerely,
W_e-(,-
!I /
L
V,
Robin M. Hittie
Chief Counsel