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HomeMy WebLinkAbout98-578 SnyderSTATE ETHICS COMMISSION 309 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 1 71 08 -1 470 (717) 783 -1610 1- 800 - 932 -0936 ADVICE OF COUNSEL July 14, 1998 Kenneth S. Snyder, President Whitehall Township Board of Commissioners 3219 MacArthur Rd. Whitehall, PA 18052 -2900 FAX : (717) 787 - 0806 • Web Site: www.ethics.state.pa.us • e - mail: sec @state.pa.us 98 -578 Re: Conflict; Public Official /Employee; Township; Member; Authority; Joint Authority; Building Code Board of Appeals; Fire Chief; Business with which Associated; Contracting; Emergency Snow Removal; Architectural Services; Surveyor; Caterer; Home Rule Charter; Supplemental Code of Ethics. Dear Mr. Snyder: This responds to your letter of April 21, 1998 by which you requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Law presents any prohibition or restrictions upon certain first class (home rule) township officials who, in their private capacities, also provide various compensated services to the township. Facts: As President of the Whitehall Township ( "Township ") Board of Commissioners, you request an advisory from the State Ethics Commission. It is initially noted that Whitehall Township is a First Class Home Rule Charter Municipality in Lehigh County. It is further initially noted that your request has been authorized by Resolution No. 2036 of the Township Board of Commissioners, a copy of which Resolution has been submitted and is incorporated herein by reference. According to Resolution No. 2036, the Township Board of Commissioners and Administration have become aware of potential conflicts of interest with regard to four individuals who serve in public positions through appointment or employment by the Township Board of Commissioners. The proffered basis for the perceived potential conflicts is that in their private capacities, three of the four individuals provide compensated services to the Township while the other provides compensated services to a joint sewer authority that was created by the Township and a neighboring borough. The particular facts which you have submitted as to the four individuals are as follows. Snyder, 98 -578 July 14, 1998 Page 2 The first individual serves as a Member of the Board of the Whitehall Township Authority ( "Water Authority "). He also serves on the Township's Building Code Board of Appeals. As for the Water Authority, you state that the Water Authority is autonomous and is responsible for the delivery of water to a large portion of the Township. Water Authority Members are appointed by the Whitehall Township Board of Commissioners and receive nominal compensation for their time. This particular individual was appointed to serve on the Water Authority early this year. In his private capacity, this individual has provided, and probably will continue to provide, services to the Township for compensation. Such services include emergency snow removal. You state that the cost of this individual's work varies greatly, and that some, but not all, such work is subject to competitive bidding. The second individual serves on the Building Code Board of Appeals. In his private capacity, this individual is a professional architect and occasionally provides architectural services to the Township. The third individual also serves on the Building Code Board of Appeals. In his private capacity, this individual is a surveyor and often provides professional services to the Coplay- Whitehall Sewer Authority ( "Sewer Authority "). The Sewer Authority is a joint authority of Whitehall Township and the Borough of Coplay. The Sewer Authority is responsible for providing sewage removal services. Some of its Members are appointed by the Whitehall Township Board of Commissioners, while the rest are appointed by the Borough of Coplay. Members receive nominal compensation. The fourth individual is the Fire Chief who oversees the Township volunteer fire department. As Fire Chief, this individual is a paid, full -time employee of the Township. In his private capacity, this individual operates a part-time catering business, which occasionally provides catering services to the Township. The cost per event does not exceed $500, and his services are utilized no more than four times per year. You have submitted a copy of the Township's own Code of Ethics. It is noted that paragraph 2 under Section 1303 of the Code of Ethics provides, in pertinent part, as follows. 2. Prohibitions - this code prohibits any public official or employee of the Township of Whitehall from engaging in the following acts: A. Interest in contract or transactions - no elected or appointed Township official or employee, or any corporation, partnership, association, joint venture, or other entity of which he is a member, officer, official, partner, stockholder, joint venturer, associate, director, employee or consultant shall solicit, benefit by, or be financially interested, directly or indirectly, in any contract for the purchase of property or services to be paid from the Township treasury. (1) No public official or employee shall have or thereafter acquire an interest in such contract or transaction. (2) No public official or employee shall have an interest in any business entity representing, advising or appearing on behalf of, whether paid or unpaid, any person involved in such contract or transaction, during his term of office or employment with the Township. Snyder, 98 -578 July 14, 1998 Page 3 (3) No public official or employee shall have solicited or accepted present or future employment with a person or business entity involved in such contract or transaction. Whitehall Township Code of Ethics at 1 -13 -3 through 1 -13 -4. You pose three specific inquiries. First, you ask whether, pursuant to the Public Official and Employee Ethics Law ( "Ethics Law "), Act 9 of 1989, P. L. 26, 65 P.S. §401, seq. the Township may use the services of these four individuals as public officials while accepting their services as local businessmen. You additionally ask whether, pursuant to the Whitehall Township Code of Ethics, these individuals may continue to provide professional services to the Township for compensation while serving in their respective public positions. Finally, you ask whether the Whitehall Township Code of Ethics can be more restrictive or less restrictive than the Ethics Law. You state that pending a response to your advisory request, you have asked the four individuals in question to either cease providing any services to the Township and its related Authorities, or to consider resignation from the various Boards on which they serve. However, you state that the Township considers it to be an unfortunate circumstance due to the fact that both the volunteer and professional services offered by each of these individuals are considered to be of great benefit to the Township and its residents. Discussion: It is initially noted that pursuant to Sections 7(10) and 7(1 1) 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. 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. The facts which you have submitted do not set forth the functions and authority of the Building Code Board of Appeals. For purposes of this Advice, it is expressly assumed that the Township's Building Code Board of Appeals exercises governmental powers and is not purely advisory. It is further expressly assumed, for purposes of this Advice, that the Water Authority and Sewer Authority were created pursuant to the Municipality Authorities Act of 1945, 53 P.S. §301, g., and that they are therefore independent agencies not subject to the control of the municipality(ies) that created them. See, e.g., Smith v. Athens Tp. Authority, 685 A.2d 651 (Pa. Commw. Ct. 1996), alloc. den., 548 Pa. 622, 693 A.2d 591. In their respective capacities as: 1) a Member of the Water Authority and Building Code Board of Appeals; 2) a Member of the Building Code Board of Appeals; 3) a Member of the Building Code Board of Appeals; and 4) Fire Chief, each of the four individuals about whom you have inquired is a public official /employee as that term is defined in the Public Official and Employee Ethics Law ( "Ethics Law "), and hence each is subject to the provisions of that law. Sections 3(a) and 3(j) of the Ethics Law provide as follows: Snyder, 98 -578 July 14, 1998 Page 4 Section 3. Restricted Activities. (a) No public official or public employee shall engage in conduct that constitutes a conflict of interest. (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. The following terms that pertain to conflicts of interest under the Ethics Law are defined 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. Snyder, 98 -578 July 14, 1998 Page 5 "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. Section 3(f) of the Ethics Law, which pertains to contracting /subcontracting, 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 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. The following terms that pertain to Section 3(f) are defined in the Ethics Law as follows: Section 2. 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. "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. "Governmental body." Any department, authority, commission, committee, council, board, bureau, division, service, office, officer, administration, legislative body, or Snyder, 98 -578 July 14, 1998 Page 6 other establishment in the Executive, Legislative or Judicial Branch of a state, a nation or a political subdivision thereof or any agency performing a governmental function. "Governmental body with which a public official or public employee is or has been associated." The governmental body within State government or a political subdivision by which the public official or employee is or has been employed or to which the public official or employee is or has been appointed or elected and subdivisions and offices within that governmental body. In applying the above provisions of the Ethics Law to your inquiry, Section 3(a) shall be addressed first. Section 3(a) of the Ethics Law does not prohibit public officials /public employees from having outside business activities or employment; however, the public official /public employee may not use the authority of his public position — or confidential information obtained by being in that position — for the advancement of his own private pecuniary benefit or that of a business with which he is associated. Pancoe, Opinion 89 -01 1. Examples of conduct that would be prohibited under Section 3(a) would include: (1) the pursuit of a private business opportunity in the course of public action, Metrick, Order No. 1037; (2) the use of governmental facilities, such as governmental telephones, postage, staff, equipment, research materials, or other property, or the use of governmental personnel, to conduct private business activities, Freind, Order No. 800; Pancoe, supra; and (3) the participation in an official capacity as to matters involving the business with which the public official /public employee is associated in his private capacity, such as the review /selection of its bids or proposals, Gorman, Order No. 1041. If the private employer or business with which the public official /public employee is associated would have a matter pending before the governmental body, the public official /public employee would have a conflict of interest as to such matter. Miller, Opinion No. 89 -024. In each instance of a conflict of interest, the public official /public employee would be required to abstain from participation and to satisfy the disclosure requirements of Section 3(j). Pursuant to Section 3(a), the above four individuals could not use the authority of their respective public positions or confidential information obtained by being in those positions, to solicit or promote private business activity for themselves or for businesses with which they are associated. Furthermore, to the extent these individuals would, in their respective public capacities, have involvement as to themselves or businesses with which they are associated, a conflict of interest would exist. In each instance of a conflict of interest, the individual with the conflict would be required to abstain and to satisfy the disclosure requirements of Section 3(j) 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 permissib /e 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 Snyder, 98 -578 July 14, 1998 Page 7 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. Under the facts which you have submitted, the governmental bodies with which the first individual is associated would include the Water Authority and the Township's Building Code Board of Appeals, but not the Township as a whole. Accordingly, contract(s) between the first individual and the Township — as opposed to the Township Building Code Board of Appeals specifically — would not be subject to the restrictions of Section 3(f). The governmental body 'with which the second individual is associated includes the Township's Building Code Board of Appeals, but not the Township as a whole. Accordingly, contract(s) between this individual or a business with which he is associated and the Township — as opposed to the Township's Building Code Board of Appeals specifically — would not be subject to the restrictions of Section 3(f). The governmental body with which the third individual is associated would include the Township's Building Code Board of Appeals, but not the Township as a whole. The facts which you have submitted reflect that the contracting involving this individual is neither with the Township nor its Building Code Board of Appeals, but rather is with the Sewer Authority. This individual's governmental body would not include the Sewer Authority. Accordingly, contract(s) between this individual or a business with which he is associated and the Sewer Authority would not be subject to the restrictions of Section 3(f). The governmental body with which the fourth individual, the Fire Chief, is associated would include the Township based upon this individual's status as an employee of the Township. Accordingly, contract(s) between this individual or a business with which he is associated and the Township would be subject to the restrictions of Section 3(f) where such contract(s) would be valued at $500 or more. The facts which you have submitted indicate that this individual provides catering services to the Township, and that the cost per event does not exceed $500. Conditioned upon the assumption that such contract(s) would legitimately be valued at Tess than $500 and would not be so valued as the result of contract fragmentation, the restrictions of Section 3(f) would not apply as to such contract(s). Parenthetically, although the contracting in question would not be prohibited under the Ethics Law based upon the facts which have been submitted and subject to the conditions and restrictions set forth above, a problem may exist as to such contracting under the Township's own Code of Ethics. Snvder, 98 -578 July 14, 1998 Page 8 Since the State Ethics Commission does not have the express statutory authority to interpret the Township's Code of Ethics, it is suggested that you seek legal advice in that regard. As for your specific inquiries, you are advised as follows. In response to your first specific inquiry, as to whether, pursuant to the Ethics Law, the Township may use the services of these four individuals as public officials while accepting their services as local businessmen, you are advised that Section 3(a) of the Ethics Law would not operate to restrict the Township in this regard. Moreover, the only potential impact of Section 3(f) upon a township is the possibility that a court may void a contract where the restrictions of Section 3(f) apply but are not met. In response to your second specific inquiry, as to whether,_pursuant to the Whitehall Township Code of Ethics, these individuals may continue to provide professional services to the Township for compensation while serving in their respective public positions, as noted above, the State Ethics Commission does not have the statutory jurisdiction to interpret the Whitehall Township Code of Ethics, and it is suggested that you seek legal advice in that regard. As for the Ethics Law, its applicability to your second specific inquiry is as set forth above. In response to your third specific inquiry, as to whether the Whitehall Township Code of Ethics can be more restrictive or less restrictive than the Ethics Law, you are advised that Section 11 of the Ethics Law provides: 65 P.S. §412. Section 11. Supplemental provisions Any governmental body may adopt requirements to supplement this act, provided that no such requirements shall in any way be Tess restrictive than the act. 65 P.S. §41 1. Section 12 of the Ethics Law provides as follows: Section 12. Conflict of law If the provisions of this act conflict with any other statute, ordinance, regulation or rule, the provisions of this act shall control. Thus, the Whitehall Township Code of Ethics may be more restrictive, but it may not be less restrictive, than the Ethics Law, and in the event of a conflict, the Ethics Law controls. This Advice is limited to addressing the applicability of Sections 3(a) and 3(f) of the Ethics Law. It is expressly assumed that there has been no use of authority of office for a private pecuniary benefit as prohibited by Section 3(a) of the Ethics Law. Further, you are advised that Sections 3(b) and 3(c) of the Ethics Law provide in part that no person shall offer to a public official /public employee and no public official /public employee shall solicit or accept anything of monetary value based upon the understanding that the vote, official action, or judgment of the public official /public 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. Snyder, 98 -578 July 14, 1998 Page 9 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. Conclusion: In their respective capacities as: 1) a Member of the Water Authority and Building Code Board of Appeals; 2) a Member of the Building Code Board of Appeals; 3) a Member of the Building Code Board of Appeals; and 4) Fire Chief, each of the four individuals about whom you have inquired is a public official /employee as that term is defined in the Public Official and Employee Ethics Law ( "Ethics Law "), and hence each is subject to the provisions of that Law. Pursuant to Section 3(a), these four individuals could not use the authority of their respective public positions or confidential information obtained by being in those positions, to solicit or promote private business activity for themselves or for businesses with _which they are associated. To the extent these individuals would, in their respective public capacities, have involvement as to themselves or businesses with which they are associated, a conflict of interest would exist. In each instance of a conflict of interest, the individual with the conflict would be required to abstain and to satisfy the disclosure requirements of Section 3(j) set forth above. Section 3(a) would not operate to restrict the Township. As for Section 3(f), the only potential impact of Section 3(f) upon the Township would be the possibility that a court might void a contract where the restrictions of Section 3(f) would apply but would not be met. As for the applicability of Section 3(f) to the individuals on whose behalf you have inquired, under the facts which you have submitted, the governmental bodies with which the first and second individuals are associated would not include the Township, such that contracting between the Township and those individuals or businesses with which they are associated would not be subject to the Section 3(f) restrictions. Likewise, Section 3(f) would not apply to contracting between the Sewer Authority and the third individual or a business with which he is associated.The governmental body with which the fourth individual, the Fire Chief, is associated would include the Township based upon this individual's status as an employee of the Township. Contract(s) between the fourth individual, the Fire Chief, or a business with which he is associated and the Township would be subject to the restrictions of Section 3(f) where such contract(s) would be valued at $500 or more. Conditioned upon the assumption that such contract(s) would legitimately be valued at less than $500 and would not be so valued as the result of contract fragmentation, the restrictions of Section 3(f) would not apply as to such contract(s). Although the contracting in question would not be prohibited under the Ethics Law based upon the facts which have been submitted and subject to the conditions and restrictions set forth above, a problem may exist as to such contracting under the Township's own Code of Ethics. Since the State Ethics Commission does not have the express statutory authority to interpret the Township's Code of Ethics, it is suggested that you seek legal advice in that regard. Finally, the Whitehall Township Code of Ethics may be more restrictive, but it may not be less restrictive, than the Ethics Law, and in the event of a conflict, the Ethics Law controls. Law. The propriety of the proposed conduct has only been addressed under the Ethics 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. Snyder, 98 -578 July 14, 1998 Page 10 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 forma/ 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. S' c - rely, Vincent . Dopko Chief Counsel