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HomeMy WebLinkAbout97-636 AntionDavid R. Antion PO Box 492 Claysville, PA 15323 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 17, 1997 97 -636 Re: Conflict, Public Official /Employee, School Director, Township Auditor - Elect, Simultaneous Service, Landlord, Building Rental to Township. Dear Mr. Antion: This responds to your letter of November 14, 1997 by which you requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employe Ethics Law presents any prohibition or restrictions upon a School Director regarding his simultaneous service as Township Auditor and also regarding his rental of a building to the Township for profit. Facts: As a School Director for the McGuffey School District and as a Buffalo Township Auditor - Elect, you request an advisory from the State Ethics Commission. Specifically, you pose the following questions: 1. Whether, as a School Board Director serving for no pay, you may simultaneously hold the office of Township Auditor for profit; 2. Whether, as a School Board Director serving for no pay, you may simultaneously hold the office of Township Auditor for no pay; 3. Whether, as a landlord who rents a building to the Township for profit, you may serve as an elected Township Auditor to that Township for profit; and 4. Whether, as a landlord who rents a building to the Township for profit, you may serve as Township Auditor to that Township for no pay. It is noted that Buffalo Township is a Second Class Township in Washington County, Pennsylvania. 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 Antion, 97 -636 December 17, 1997 Page 2 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 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. Both as a School Director for McGuffey School District and as a Buffalo Township Auditor, you would be considered a public official as that term is defined in the Public Official and Employe Ethics Law ( "Ethics Law "), and hence in each such capacity you would be subject to the provisions of the Ethics 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." 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 An i n, 97 -636 December 17, 1997 Page 3 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. Section 3(f) of the Ethics Law provides as follows: 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. Section 3(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 3(f) requires that an "open and public process" be observed as to the contract with the governmental body. Pursuant to Section 3(f), an "open and public process" includes: (1) prior public notice of the employment or contracting possibility; (2) sufficient time for a reasonable and prudent competitor /applicant to be able to prepare and present an application or proposal; Antion, 97 - 636 December 17, 1997 Page 4 (3) public disclosure of all applications or proposals considered; and (4) public disclosure of the contract awarded and offered and accepted Section 3(f) of the Ethics Law also requires that the public official /employee may not have any supervisory or overall responsibility as to the implementation or administration of the contract with the governmental body. 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. In each instance of a conflict, 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 voting 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 your first and second inquiries regarding simultaneous service, it is initially noted that the General Assembly has the constitutional power to declare by law which offices are incompatible. Pa. Const. Art. 6, §2. Although the State Ethics Commission does not have the express statutory jurisdiction to interpret such other laws, it may review the Ethics Law to Antion, 97 -636 December '17, 1997 Page 5 determine that a conflict exists based upon the statutory incompatibility. King, Opinion No. 85 -025. A conflict of interest exists under the Ethics Law where a pecuniary benefit or financial gain (such as salary, benefits, and the like) is derived as a result of holding incompatible positions simultaneously. The Commission has determined that if a particular statutory enactment prohibits an official from receiving a particular pecuniary benefit or financial gain, then that official's receipt of same, through the authority of public office, is unauthorized in law and hence, contrary to Section 3(a) of the Ethics Law. In this case, in order to determine whether a particular pecuniary benefit or financial gain is prohibited by law, the following provisions must be reviewed: § 3 - 322. Eligibility; incompatible offices Any citizen of this Commonwealth, having a good moral character, being eighteen (18) years of age or upwards, and having been a resident of the district for at least one (1) year prior to the date of his election or appointment, shall be eligible to the office of school director therein: Provided, That any person holding any office or position of profit under the government of any city of the first class, or the office of mayor, chief burgess, county commissioner, district attorney, city, borough, or township treasurer, member of council in any municipality, township commissioner, township supervisor, tax collector, assessor, assistant assessor, any comptroller, auditor, constable, executive director or assistant executive director of an intermediate unit, supervisor, principal, teacher, or employe of any school district, shall not be eligible as a school director in this Commonwealth... . 24 P.S. §3 -322 (Emphasis added). §6. Office of constable and township or borough auditor No person hereafter elected shall be capable of holding and exercising the office of school director, constable, path- master or commissioner of roads, and that of township or borough auditor. 65 P.S. §6. The above provisions of law appear to forbid simultaneous service in the positions in question. Any financial gain or pecuniary benefit that you as a public official would receive while simultaneously holding these positions would be a gain other than compensation provided for by law. King, Opinion 85 -025. Therefore, simultaneous service in the positions of School Director and Township Auditor would be contrary to Section 3(a) of the Ethics Law to the extent a pecuniary benefit or financial gain would be received that would be unauthonzed based upon the foregoing incompatibility provisions. To the extent you would simultaneously hold the aforesaid positions without being compensated or otherwise financially benefitted in either position, the Ethics Law itself would not apply to restrict the simultaneous service in that there would be no Antion, 97 -636 December 17, 1997 Page 6 element of a prohibited private pecuniary benefit. However, as noted, it would appear that the above, other provisions of law may forbid such simultaneous service without regard to compensation, and so, it is recommended that you seek legal advice in that regard. Turning to your third and fourth specific inquiries, by which you ask whether you may serve as an elected Township Auditor to Buffalo Township, either for profit or without pay, where you are, in your private capacity, a landlord who rents a building to the Township, you are advised as follows. Under the Ethics Law, it is legally irrelevant whether you are compensated as a Township Auditor in addressing your third and fourth specific inquiries. Pursuant to Section 3(a), in your public capacity as Township Auditor, you would have a conflict of interest in performing your official duties as to the Township's payments to you as a landlord. Therefore, you would be required to abstain from that portion of the audit and to satisfy the disclosure requirements of Section 3(j) as set forth above. As for Section 3(f), you are advised that Section 3(f) of the Ethics Law 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 3(f) requires that an "open and public process" be observed as to the contract with the governmental body. Pursuant to Section 3(f), an "open and public process" includes: (1) prior public notice of the employment or contracting possibility; (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. Section 3(f) of the Ethics Law also requires 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. Where Section 3(f) applies, its requirements must be strictly observed. If you would serve as a Buffalo Township Auditor, any contract valued at $500 or more between you and Buffalo Township would be subject to the restrictions of Section 3(f). This would be so not only as to new contracts but also as to renewals or modifications of pre- existing contracts. Parenthetically, although the contracting in question would not be prohibited under the Ethics Law provided the requirements of Sections 3(a), 3(f), and 3(j) are satisfied, a problem may exist as to such contracting under the respective code. Antion, 97 -636 December 17, 1997 Page 7 In the instant situation, the Second Class Township Code provides as follows: §68102. Letting contracts • (i) No township official, either elected or appointed, or township employe 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 the township involving the payment by the township of more than five hundred dollars ($500) in any year unless the contract is awarded through the public bid process. This limitation does not apply if the officer or appointee of the township is an employe 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 the officer cannot possibly be benefited thereby, either financially or otherwise. If a supervisor is within this exception, the supervisor shall so inform the board of supervisors and refrain from voting on the payments and shall in no manner participate in the contract. Any official or appointee who knowingly violates this provision is subject to surcharge to the extent of the damage shown to be sustained by the township, is ousted from office or employment and commits a misdemeanor of the third degree. 53 P.S. §68102(i). 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: Both as a School Director for McGuffey School District and as a Township Auditor for Buffalo Township, you would be considered a public official subject to the provisions of the Ethics Law. You may not, consistent with Section 3(a) of the Ethics Law, simultaneously serve in the positions of School Director for McGuffey School District and Township Auditor for Buffalo Township where you would be compensated or otherwise financially benefitted in either capacity. Section 3(a) of the Ethics Law would not apply to preclude simultaneous service if you would not be paid or otherwise financially benefitted in either capacity. However, it is recommended that you seek legal advice as to the restrictions of the other provisions of law set forth herein should you intend to hold both positions simultaneously without such compensation. You would have a conflict of interest pursuant to Section 3(a) of the Ethics Law in performing your duties as a Buffalo Township Auditor with regard to payments to yourself as a landlord who rents a building to the Township. In each instance of a conflict of interest, you would be required to abstain from participation and to satisfy the disclosure requirements of Section 3(j) as set forth above. Antion, 97 -636 December 17, 1997 Page 8 Contracting between you and Buffalo Township would not be prohibited under the Ethics Law provided the regyirements of Sections 3(a), 3(f), and 3(j) would be satisfied. It is recommended that you seek legal advice as to the applicability of the Second Class Township Code. 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 1. 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, t"--o-do i • Vincent J. Dopko Chief Counsel