HomeMy WebLinkAbout98-608 ScottRobert W. Scott, Esquire
Ehmann, Van Denbergh & Trainor
Two Penn Center Plaza, Ste. 725
Philadelphia, PA 1 91 02 -1 707
Dear Mr. Scott:
STATE 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
October 20, 1998
Re: Public Official /Public Employee; Solicitor; Retained /Employed; Municipality;
Zoning Hearing Board; Bond Counsel.
This responds to your letter of September 18, 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 a municipal Solicitor who is retained by — as opposed
to being an employee of — the governmental body, with regard to simultaneously
serving as bond counsel to the municipality.
Facts: You are the Solicitor for a municipality's "quasi- judicial Zoning Hearing
Board," in which position you provide counsel to and draft the findings of fact and
opinions of the Zoning Hearing Board. You are paid on an hourly basis by the
municipality.
The municipality intends to borrow money in the municipal bond market and the
municipality will need to retain bond counsel in connection with the municipal bond
financing transaction. The bond counsel will have to draft the financing documents,
to "opine that interest on the bonds is exempt from Federal income tax," and to
conclude that the financing is properly adopted and approved in accordance with the
municipality's debt ordinance. As a member of a red -book listed law firm which
concentrates in municipal bond law, you would like to be a candidate for the said bond
counsel position.
You request an advisory from the State Ethics Commission as to whether the
Ethics Law would preclude you, as a Solicitor for the Zoning Hearing Board, from also
serving as bond counsel for the municipality.
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
FAX : (717) 787 -0806 • Web Site: www.ethics.state.pa.us • e -mail: sec @state.pa.us
98 -608
Scott, 98 -608
October 20, 1998
Page 2
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.
In 1997, the status of Solicitors under the Public Official and Employee Ethics
Law ( "Ethics Law "), Act 9 of 1989, P.L. 26, 65 P.S. §401 t seq., was addressed by
the Commonwealth Court of Pennsylvania.
In P.J.S. v. State Ethics Commission, 697 A.2d 286 (Pa. Commw. Ct. 1997),
appeal pending, No. 0091 M.D. Appeal Docket 1997, the Commonwealth Court of
Pennsylvania held, inter Alia, that the conflict of interest provisions of the Ethics Law
do apply to solicitors who are public employees and are not just on retainer.
However, in C.P.C. v. State Ethics Commission, 698 A.2d 155 (Pa. Commw.
Ct. 1997), based upon an analysis of prior precedents including Ballou v. State Ethics
Commission, 496 Pa. 127, 436 A.2d 186 (1981), Maunus v. State Ethics
Commission, 518 Pa. 592, 544 A.2d 1324 (1988), and P.J.S v. State Ethics
Commission, 669 A.2d 1 105 (Pa. Commw. Ct. 1996), the Commonwealth Court of
Pennsylvania set forth its view that a municipal Solicitor who is retained by — as
opposed to being an employee of — the municipality is not a "public official" or "public
employee" as defined in the Ethics Law and is not subject to the conflict of interest
provisions of the Ethics Law. The Court stated:
... (T]his court pointed out in P.J.S. that the General Assembly did not
add or include "solicitors" in its definitions of "public employees" or
"public officials" whose conduct is regulated by section 3 of the Ethics
Act. Id. As such, this court stated that it could not conclude that it was
clearly the General Assembly's intent to include "solicitors," who are not
normally full -time public employees, but more like consultants, among the
class of persons required to comply with the regulations regarding ethical
and professional conduct under section 3 of the Ethics Act. Id.
Based upon our review of the pleadings in this case and our
analysis of Ballou, Maunus and P.J.S., we conclude that CPC's conduct
is not governed by the provisions of the Ethics Act and that he is not
subject to the jurisdiction of the Commission.
C.P.C. v. State Ethics Commission, supra, 698 A.2d at 159. The Court further stated,
in a footnote:
We note that on July 3, 1997, this court issued its decision in
P.J.S. v. Pennsylvania State Ethics Commission, 697 A.2d 286 (Pa.
Cmwlth. 1997) (P.J.S. I/), this court reiterated that the conflict of
interest provisions of section 3 of the Ethics Act apply to solicitors who
are public employees and not just on retainer. P.J.S. was hired as a full -
time solicitor for the City of Erie, was placed on the City payroll, was
paid a salary and received the same benefits as other employees of the
City. Like the Commonwealth attorneys in Maunus, P.J.S.'s status with
the City was that of an employee rather than a consultant on retainer or
an independent contractor. Accordingly, this court determined that P.J.S.
was a public employee who was covered by section 3 of the Ethics Act.
Scott, 98 -608
October 20, 1998
Page 3
The present case is distinguishable from P.J.S. // in that CPC is not
a full -time, salaried employee of the borough who receives the same
benefits as other borough employees. Rather, CPC is a legal advisor or
consultant on retainer to the borough. As such, his conduct is not
covered by section 3 of the Ethics Act.
Id., at Note 10.
The State Ethics Commission filed a Petition for Allowance of Appeal in the
C.P.C. case, which Petition was denied. See, 704 A.2d 640 (Pa. 1997).
From the facts which you have submitted, it appears that as Solicitor of the
municipality Zoning Hearing Board, you are not an employee of the said governmental
body, but rather are retained. Therefore, based upon C.P.G., supra, you would not be
considered a "public official" or a "public employee" subject to the Ethics Law and
specifically, Section 3(a) of the Ethics Law.
However, p_11 Solicitors are required to file Statements of Financial Interests. 65
P.S. §404(a); Foster, Opinion No. 98 -002. Therefore, you would be required to file
Statements of Financial Interests providing full disclosure as required by the Ethics
Law, each year the aforesaid position as Solicitor is held and the year following
termination of service in said position.
Moreover, it is the State Ethics Commission's view that every "person" is
subject to Section 3(b) of the Ethics Law. Foster, Opinion No. 98 -002. Section 3(b)
of the Ethics Law essentially provides that no "person" shalt offer or give to a public
official, public employee, or nominee or candidate for public office, or to a member of
such an individual's immediate family, or to a business with which such an individual
is associated, anything of monetary value based upon the offeror's /donor's
understanding that the vote, official action, or judgement of the public official, public
employee, or nominee or candidate for public office would be influenced thereby. The
State Ethics Commission has held that a Solicitor, though not himself a public
official /public employee, may not engage in such conduct in his capacity as a
"person." Foster, supra. Of course, 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 your inquiry in light of the aforesaid developments in
case law.
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 herein is the
applicability of the respective municipal code or the Rules of Professional Conduct.
Conclusion: Based upon the submitted facts that as Solicitor of the municipality
Zoning Hearing Board, you are retained by — as opposed to being an employee of —
the municipality, you would not be considered a public official /public employee subject
to the Ethics Law. Consequently, Section 3(a) of the Ethics Law would not apply to
you in the said capacity as Solicitor. However, all Solicitors are required to file
Statements of Financial Interests pursuant to Sections 4 and 5 of the Ethics Law.
Furthermore, Section 3(b) of the Ethics Law applies to all "persons" including
"persons" who happen to be Solicitors, regardless of whether they are public
officials /public employees. Lastly, the propriety of the proposed conduct has only been
addressed under the Ethics Law.
Scott, 98 -608
October 20, 1998
Page 4
Pursuant to Section 7(111, 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 `1. Dopko
Chief Counsel