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HomeMy WebLinkAbout99-636 ReillyAndrew J. Reilly, Esquire Swartz, Campbell & Detweiler 1 15 N. Jackson Street Media, PA 19063 STATE ETHICS COMMISSION 309 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 (717) 783 -1610 1- 800 - 932 -0936 ADVICE OF COUNSEL December 14, 1999 99 -636 Re: Conflict; Public Official /Employee; County Councilman; Redevelopment Authority; County Economic Development Oversight Board; Law Firm; Business With Which Associated. Dear Mr. Reilly: This responds to your letter of November 9, 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 el seq., presents any prohibition or restrictions upon a county councilman who is a partner in a law firm that represents the county redevelopment authority and the county economic development oversight board, where the county council: (1) appoints the members of the redevelopment authority, approves its powers, and pays its expenses; and (2) budgets and funds the operations of the county economic development oversight board. Facts: As a future Delaware County Councilman, you seek an advisory from the State Ethics Commission. You state that you are a partner in the law firm of Swartz, Campbell & Detweiler. As a partner, your pay is based upon a percentage of the firm's profits as determined by the firm's management committee, of which you are not a member. Swartz, Campbell & Detweiler is presently counsel for the Delaware County Redevelopment Authority ( "RDA ") and the Delaware County Economic Development Oversight Board ( "EDOB "). The RDA is not an agency of Delaware County, but rather, is an agency of the Commonwealth of Pennsylvania, having been created pursuant to the Pennsylvania Urban Redevelopment Law, 35 P.S. §1701 et seq. Nevertheless, you state that the RDA's authority is localized in nature in that its powers are subject to County approval. The RDA is not cloaked in the Commonwealth's sovereign immunity. Furthermore, the RDA's board members are appointed by the County Council and its expenses are forwarded to the County Council for payment. The EDOB has been created by the County Council to oversee all economic development activities within the County of Delaware. Its operations are budgeted and FAX: (717) 787 -0806 • Web Site: www.ethics.state.pa.us • e -mail: ethics @state.pa.us Reilly, 99 -636 December 14, 1999 Page 2 funded by County Council. EDOB's expenses are submitted to the County each month. On November 2, 1999, you were elected to the Delaware County Council. Your four -year term will begin in early January, 2000. You request an advisory opinion as to whether your law firm's continued representation of the RDA and the EDOB would result in a violation by you of the Ethics Act while you are serving on the Delaware County Council. 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 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. Upon taking office as a Councilman for Delaware County, you will be a public official as that term is defined in the Ethics Act, and hence you will be subject to the provisions of that Act. Section 1 103(a) of the Ethics Act provides: Section 1103. 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 1 102. 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. 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 Reilly, 99 -636 December 14, 1999 Page 3 65 Pa.C.S. §1102. 65 Pa.C.S. §1103(f). 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. In addition, Sections 1 103(b) and 1 103(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. Section 1103(f) of the Ethics Act provides as follows: Section 1 103. Restricted activities (f) Contract. - -No public official or public employee or his spouse or child or any business with 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 1 103(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 awared a contract with the Reilly, 99 -636 December 14, 1999 Page 4 governmental body, in an amount of $500 or more, Section 1103(f) requires that an "open and public process" be observed as to the contract with the governmental body. Pursuant to Section 1 103(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 awared and offered and accepted. Section 1 103(f) of the Ethics Act 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 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. Reilly, 99 -636 December 14, 1999 Page 5 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, you are advised that the Ethics Act would not preclude your service as a Delaware County Councilman merely because your law firm represents the RDA and the EDOB. However, pursuant to Section 1 103(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. Your law firm, Swartz, Campbell & Detweiler, is a business with which you are associated. Thus, pursuant to Section 1 103(a) of the Ethics Act, you would be prohibited from using the authority of your office as a member of the Delaware County Council, or any confidential information you would have access to by being a County Councilman, for the private pecuniary benefit of Swartz, Campbell & Detweiler. Pursuant to Section 1 103(a) of the Ethics Act, you should not participate in voting to approve your firm's bills. See, Kurtz, Order 1 1 16. Further, in your capacity as a member of the Delaware County Council, you would have a conflict of interest with regard to appointing /reappointing Member(s) of the RDA or EDOB because your law firm is appointed /retained by these bodies to serve as their Counsel. In analogous situations, the Commission has noted that official action where such a circular relationship exists presents a conflict of interest. See, Bassi, Opinion No. 86- 007 -R; Woodrinq, Opinion No. 90 -001. In each instance of a conflict of interest, you would be required to abstain from participation and to fully satisfy the disclosure requirements of Section 1 103(j) of the Ethics Act as set forth above. To the extent that your firm contracts with Delaware County, the restrictions of Section 1103(f) of the Ethics Act must be observed. 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 other than the Ethics Act has not been considered in that they do not involve an interpretation of the Ethics Act. Specifically not addressed herein is the applicability of the Rules of Professional Conduct. Conclusion: Upon taking office as a Councilman for Delaware County, you will be a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. §1101 et sec . The law firm of "Swartz, Campbell & Detweiler," for which you are a partner, is a business with which you are associated. Pursuant to Section 1103(a) of the Ethics Act, you would be prohibited from using the authority of your office as a member of the Delaware County Council, or any confidential information you would have access to by being a County Councilman, for the private pecuniary benefit of Swartz, Campbell & Detweiler. Reilly, 99 -636 December 14, 1999 Page 6 The Ethics Act would not preclude your service as a Delaware County Councilman merely because your law firm represents the Delaware County Redevelopment Authority and the Delaware County Economic Development Oversight Board. However, pursuant to Section 1103(a) of the Ethics Act, you should not participate in voting to approve your firm's bills. You would specifically have a conflict of interest in appointing members to the Delaware County Redevelopment Authority or the Delaware County Economic Development Oversight Board, because these bodies appoint /retain your firm as their Counsel. In each instance of a conflict of interest, you would be required to abstain from participation and to fully satisfy the disclosure requirements of Section 1103(j) of the Ethics Act as set forth above. To the extent that your firm contracts with Delaware County, the restrictions of Section 1 103(f) of the Ethics Act must be observed. 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. 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. Vincent J. Dopko Chief Counsel