Loading...
HomeMy WebLinkAbout00-531 YoungBrian W. Young 1790 Forest Creek Drive Blue Bell, PA 19422 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 March 2, 2000 00 -531 Re: Conflict; Public Official /Employee; Township; Supervisor; Vote; Grant; Airport; Business With Which Associated. Dear Mr. Young: This responds to your letter of January 26, 2000 by which you requested advice from the State Ethics Commission. �SSUe Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. §1101 et seq., presents any prohibition or restrictions upon a township supervisor as to voting on the eligibility of an airport owner to receive federal and state funds for a runway and rehabilitation extension project where the supervisor's business partner is a partner in a partnership that has an interest in a limited partnership that owns the airport. Facts: You are a Member of the Whitpain Board of Supervisors ( "Board ") in Montgomery County ( "County "). The Board consists of five members. On or about February 15, 2000, the Board will vote on whether Wings Field ( "Airport"), a privately owned public use airport in Whitpain Township ( "Township "), may receive government funding for a runway improvement and extension project pursuant to Section 2210 of the County Code. The Airport is seventy -years old and is situated on 217 acres of land. The Airport meets all of the FAA and PennDOT Bureau of Aviation criteria necessary to become eligible for government funding of up to $5,000,000 to help underwrite the improvement and extension of a single runway. You state that the County Code requires that an airport owner seek approval from both the County and the Township before it can receive any government grants for the project. The grants, which are funded primarily through federal money, are funneled through PennDOT's Bureau of Aviation through a block grant program. A limited number of privately owned airports can qualify for these funds if they are both open to the public and deemed important enough by the Federal Aviation Authority and PennDOT's Bureau of Aviation. You state that under these criteria, the Airport qualifies for government grants. The Airport owner /proposed grantee is a limited partnership known as Wings Field Preservation Associates LP ( "Wings "). You state that Wings consists of approximately 40 limited partners and is run by a general partnership that is in the FAX: (717) 787 -0806 • Web Site: www.ethics.state.pa.us • e -mail: ethics @state.pa.us Youna, 00 -531 March 2, 2000 Page 2 form of a corporation. Wings borrowed $5.5 million and acquired the field for $10,000,000 on October 30, 1998. Wings appeared before the Board on January 18, 2000 at a well publicized public meeting at which it demonstrated its need and eligibility for government funds. Since you believe that Wings is entitled to the funds, you intend to vote favorably. You state that the project has generated some controversy in the community and that you could well be the "swing vote" when the Board votes on the project. You have become aware that your business partner is one of three partners in a partnership that owns two units of the 94 issued and outstanding units of Wings. You have verified that the two units owned by your partner's partnership were acquired for $100,000 and represent 1% of the value of the Airport's acquisition price and about 2% of the equity held by Wings in the Airport. Neither your partner's partnership nor any of the three members of that partnership are shareholders, directors or officers of the general partnership that controls Wings. You state that if Wings were to receive government funding, the amount that the owners would receive would be substantially reduced if the Airport were sold. This is because Wings would first be obligated to reimburse the government for the grant if it did not keep the Airport open for at least ten years. You ask whether you are barred from voting on the eligibility of Wings to receive federal and state funds for the runway rehabilitation and extension project. You also ask whether you are required to publicly disclose your relationship to your business partner prior to the vote. You believe that there is no conflict because you have no direct or indirect financial interest in the Airport project. You state that even if you did have a financial interest, it would be de minimis. Discussion: It is initially noted that pursuant to Sections 1107(10) and 1107(1 1) of the Ethics Act, 65 Pa.C.S. §§1107(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 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), (11). An advisory only affords a defense to the extent the requestor has truthfully disclosed all of the material facts. As a Supervisor for Whitpain Township, Montgomery County, you are a public official as that term is defined in the Ethics Act, and hence you are subject to the provisions of that Act. Section 1103(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). You na, 00 -531 March 2, 2000 Page 3 The fo (lowing terms are defined in the Ethics Act as follows: Section 1102. 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 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. "Financial interest." Any financial interest in a legal entity engaged in business for profit which comprises more than 5% of the equity of the business or more than 5% of the assets of the economic interest in indebtedness. 65 Pa.C.S. §1102. 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. Section 1103(j) of the Ethics Act provides as follows: Section 1103. Restricted activities. Young, 00 -531 March 2, 2000 Page 4 (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. As to whether the partnership with which you are involved is a "business with which you are associated" as that phrase is defined under the Ethics Act, the facts which you have submitted do not indicate whether your interest in said partnership comprises more that 5% of the equity or the assets of the economic interest in indebtedness. However, since it is factually presupposed that your partnership will have no involvement and derive no financial benefit from the project, there would be no conflict as to that particular partnership. As to whether Section 1103(a) of the Ethics Act would preclude you from voting on the eligibility of Wings to receive federal and state funds for the runway rehabilitation and extension project, you would not have a conflict provided that neither you, a member of your immediate family, nor a business with which you or a member of your immediate family is associated would have a financial interest in Wings, subject to the following qualification. It is assumed that you or any business Young, 00 -531 March 2, 2000 Page 5 with which you or a member of your immediate family is associated would not have any reasonable and legitimate expectation of receiving any private pecuniary benefit as to the airport project, as for example, through a contract /subcontract to pave the airport runway for Wings. See, Amato, 89 -002. It is not suggested that such an expectation exists and the above is provided in order to be complete in our response. Your question as to publicly disclosing the nature of your interest has been fully addressed above. 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 respective municipal code. Conclusion: As Supervisor for Whitpain Township, Montgomery County, you are a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. §1101 et seq. You would not have a conflict as to voting on the eligibility of Wings, a limited partnership, to receive federal and state funds for the runway rehabilitation and extension project for an airport provided that neither you, a member of your immediate family, nor a business with which you or a member of your immediate family is associated would have a financial interest in Wings. It is assumed that you or any business with which you or a member of your immediate family is associated would not have any reasonable and legitimate expectation of receiving any private pecuniary benefit as to the airport project. The voting restrictions under Section 1103(j) must be observed. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Pursuant to Section 1107(11), 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 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. rely, Vincent J. ') opko Chief Counsel