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HomeMy WebLinkAbout99-617 ConfidentialSTATE ETHICS COMMISSION 309 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 (717) 783 -1610 1- 800 - 932 -0936 ADVICE OF COUNSEL October 8, 1999 Re: Conflict; Public Official /Employee; School Board Director; A School District; Immediate Family; Spouse; Vote. This responds to your letter of September 8, 1999 by which you requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. §1101 et mg., presents any prohibition or restrictions upon a school board director regarding participation in financial matters as to district sporting events when the director's spouse is paid by the school district for refereeing district sporting events. Facts: As Solicitor for the A School District, you have been asked to make an inquiry on behalf of a duly elected School Board Director. The School Board Director occasionally votes for approval of the payment of bills and the adoption of an overall budget for the A School District. A School District routinely allocates funds from its budget for its athletic department and uses a portion of those funds to pay referees, umpires and other officials assigned to athletic events involving School District teams. PIAA and /or League Officials make assignments to referee and /or umpire interscholastic conference events while the Athletic Director for the home school team makes assignments to referee and /or umpire non - conference PIAA regulated events. Upon completion of an assignment, referees and /or umpires receive a check directly from A School District funds. The School Board Director's spouse is a referee and umpire and has, on occasion, been assigned to work at games involving A School District teams. You request an advisory on his behalf concerning voting on matters involving the general payment of bills, adoption of a budget or any other matters that could involve allocation of monies used to pay his spouse for services rendered as a referee or umpire. Discussion: It is initially noted that pursuant to Sections 1107(10) and 1107(11) of the Ethics Act, 65 Pa.C.S. §§1107(10), (1 1), 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 FAX: (717) 787 - 0806 • Web Site: www.ethics.state.pa.us • e - mail: ethics@state.pa.us 99 -617 Confidential Advice, 99 -617 October8, 1999 - Page 2 disclose all of the material facts relevant to the inquiry. 65 Pa.C.S. §§1107(10), (1 1). An advisory only affords a defense to the extent the requestor has truthfully disclosed all of the material facts. The School Board Director for A School District is a public official as that term is defined in the Ethics Act, and hence the School Board Director is subject to the provisions of that Act. Section 1 103(a) of the Ethics Act provides: Section 1 103. Restricted activities. (a) Conflict of interest. - -No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa.C.S. §1103(a). The following terms are defined in the Ethics Act as follows: Section 1102. Definitions. 65 Pa.C.S. §1102. "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. 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. "Immediate family." A parent, spouse, child, brother or sister. In addition, Sections 1103(b) and 1103(c) of the Ethics Act 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 judgment 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. Confidential Advice, 99 -617 October - 8, 1999 - Page 3 Section 1 103(j) of the Ethics Act provides as follows: Section 1103. Restricted activities. (j) 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 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. 65 Pa.C.S. §1103(j). In each instance of a conflict, Section 1103(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 Act, 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 Act to the instant matter, pursuant to Section 1103(a) of the Ethics Act, 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. Since the term "immediate family" is defined to include a parent, spouse, child, brother, or sister and since the School Board Director's spouse is in one of the familial relationships delineated above, Section 1 103(a) of the Ethics Act would prohibit the School Board Director from participating in matters before the School Board that would result in a financial benefit to his spouse. If the School Board Director were to participate in such matters, his actions would be a conflict of interest under Section Confidential Advice, 99 -617 October - 8, 1999 Page 4 1 103(a) of the Ethics Act because he would be using the authority of office for the pecuniary benefit of his spouse. In each instance of such a conflict of interest, the School Board Director would be required to abstain and observe the disclosure requirements of Section 1 103(j) set forth above. Having established the above principles, the definition of conflict provides an exclusion with respect to the use of authority of office when it affects a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official /public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. In order for the exclusion to apply, the School Board Director's spouse must be in a class /subclass consisting of more than one person and be affected to the same degree as the other members of the class /subclass. Thus, in a matter coming before the School Board that would financially impact the School Board Director's spouse and all other umpires or referees, such as an increase in wages to the same degree, the class /subclass exception to the definition of conflict of interest would apply, and the School Board Director would not be precluded from voting on such matter. We will now address the specific questions you posed. You have inquired as to the propriety of the School Board Director's participation in voting on the general payment of bills, adoption of a budget or any other matter that would involve allocation of monies that may be used to pay the School Board Director's spouse for services rendered as a referee or umpire. As to your first question concerning voting upon the general payment of bills, the issue was addressed by the Commission in Krushinski, Order 168. The issue in Krushinski was whether a school director who voted to pay bills submitted by a retail discount store violated the Ethics Act when he was employed as a manager for that store. After noting the prohibition against the use by a public official /public employee of the authority of public office for a private financial gain under Section 3(a) of the Ethics Act, the Commission held that the school director could not vote on the payment of bills that were not pre- ordained or pre -set within the contract -bid price. The Commission reasoned: If the Board has discretion as to the amount to be paid to Sugarman's and the price of a particular item purchased within the general contract price is not pre -set within the contract -bid price, then discretion is vested with the Board as to the payment. You may not participate in the exercise of the Board's discretionary payments to Sugarman's in such a circumstance without giving rise to an appearance of a conflict with the public trust. Id at 5. As for bills that were pre- ordained or pre -set by the general contract, the Commission held that such bills were routine and uncontested and not subject to the school director or the school board's discretion. Thus, the school director could participate in the decision to pay those bills. Applying Krushinski to the instant case, the School Board Director may vote upon the general payment of bills for umpires or referees if those bills are routine and uncontested. For example, if the School Board has decided in advance that all umpires /referees will receive a set wage after completing an assignment, the School Board Director may participate in the decision to pay those bills as there is no conflict of interest. Conversely, the School Board Director may not vote upon the payment of Confidential Advice, 99 -617 October B, 1999 Page 5 bills for umpires or referees that are not routine and uncontested. For instance, if a situation arises involving payment of a bill for services rendered by the School Board Director's spouse where she questions the amount of compensation to which she is entitled, the Director would not be permitted to participate as to that bill since he would have a conflict. As for your question concerning the adoption of a budget, you are advised that to the extent that the School Board Director's participation in voting on such matter would result in a pecuniary benefit to his spouse, he would have a conflict of interest and would have to abstain and observe the disclosure requirements of Section 1103(j) unless the class /subclass exclusion outlined above would apply. If the matter involved allocating funds to pay all umpires /referees to the same degree, the class /subclass exception to the definition of conflict of interest would apply, and the School Board Director would not be precluded from voting on such matter. As for your final question concerning the propriety of the School Board Director's participation in other matters, a possible conflict of interest may arise as to matters involving the Athletic Director who is responsible for making assignments to referee and /or umpire non - conference PIAA regulated events. In the School Board Director's position, he has authority to decide financial matters impacting upon the Athletic Director including the allocation of funds from the general budget for the Athletic Department. The Athletic Director, in turn, may seek the services of the School Board Director's spouse to referee /umpire games. Because the Athletic Director may utilize the services of the School Board Director's spouse whereby the spouse would obtain a pecuniary benefit, the School Board Director should not participate in matters involving the Athletic Director as per Section 1103(a) of the Ethics Act. Act. The propriety of the proposed conduct has only been addressed under the Ethics Conclusion: The School Board Director for A District is a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. §1101 et seq. In matters coming before the School Board, including the adoption of a budget, that would result in a pecuniary benefit to the School Board Director's spouse, the School Board Director would have a conflict of interest as to such matters and would have to abstain and observe the disclosure requirements of Section 1 103(j) unless the class /subclass exclusion outlined above would apply. The School Board Director may not participate in voting upon the general payment of bills which are not pre- ordained or pre -set. He may, however, participate in voting upon the general payment of bills which are routine and uncontested. Because the Athletic Director may utilize the services of the School Board Director's spouse whereby the spouse would obtain a pecuniary benefit, the School Board Director should not participate in matters involving the Athletic Director as per Section 1103(a) of the Ethics Act. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Pursuant to Section 1 107(1 1), 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 requestor has disclosed truthfully all the material facts and committed the acts complained of in reliance on the Advice given. Confidential Advice, 99 -617 October 8, 1999 - Page 6 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. Sincerely, - Vincent J. D ko Chief Counsel