HomeMy WebLinkAbout00-595-C RubensteinHerbert F. Rubenstein, Esquire
Attorney At Law
Suite 107
25 West Skippack Pike
Broad Axe, PA 19002 -5152
Dear Mr. Rubenstein:
STATE ETHICS COMMISSION
309 FINANCE BUILDING
P.O. BOX 11470
HARRISBURG, PA 17108 -1470
(717) 783 -1610
1- 800 - 932 -0936
ADVICE OF COUNSEL
September 12, 2000
Re: Conflict; Public Official /Employee; Member; Governing Body; Municipality;
Employee; Construction Company; Business With Which Associated; Subdivision; Land
Development; Code Enforcement Proceedings; Participate; Vote; De Minimis Economic
Impact; Business Relationship; Clarification of Advice.
This responds to your letter of August 11, 2000 by which you requested
clarification of Rubenstein, Advice 00 -595.
Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65
Pa.C.S. §1101 et seq., presents any prohibition or restrictions upon a member of a
municipality's governing body as to: 1) voting or participating in matters related to
subdivision and land development projects where the member is employed by a
construction company,, the services of which could be utilized in such rojects in the
future; 2) soliciting business from the developer or the developer's tenant(s) after official
approval of such subdivision and land development projects; and 3) voting on code
enforcement proceedings involving projects completed or being completed by the
construction company.
Facts: You initially sought an advisory from the State Ethics Commission by
letter dated June 22, 2000. In response to your request, Rubenstein, Advice 00 -595
was issued to you on July 26, 2000, which Advice is incorporated herein by reference.
You now seek clarification as to whether the "de minimis economic impact"
exception would apply under the facts of your inquiry.
You also seek supplemental advice as to the following additional facts. The
Company, which employs the Member, does work with developers on projects outside
of the municipality that the Member serves. If a developer has a project within the
municipality that the Member serves, but there is no reasonable expectation that the
Company would work on that project, you ask whether the Member would still have a
conflict arising out the fact that the Company does work for the developer in other
municipalities or counties.
FAX: (717) 787 -0806 • Web Site: www.ethics.state_pa.us • e -mail: ethics@state.pa.us
00 -595 -C
Rubenstein, 00 -595 -C
September 12, 2000
Page 2
Discussion: As noted in Rubenstein, Advice 00 -595, the Member is a public
official as that term is defined in the Ethics Act, and hence, the Member is subject to the
provisions of that Act. In that Rubenstein, Advice 00 -595 is incorporated herein by
reference, the quotations and commentary as to the Ethics Act will not be repeated.
With regard to your first question, the Ethics Act's definition of "conflict" or
"conflict of interest" provides an exclusion with respect to the use of authority of office
when such action has a "de minimis economic impact." The Ethics Act defines "de
minimis economic impact" as "an economic consequence which has an insignificant
effect." 65 Pa.C.S. §1102.
The Commission applied the de minimis exclusion in Schweinsburq, Order No.
900, when it addressed whether a township supervisor, who was also an appointed
roadmaster, violated Section 3(a) of the Ethics Law when he received $61.20 for work
on a pump house project that he did not actually perform. The supervisor's personal
logs reflected that he was performing other duties for the township on the days and at
the times that the time reports reflected that he was purportedly working on the pump
house. The Commission stated:
In applying the de minimis economic impact
exclusion, we must note that this is not a term that we may
quantify as to a set dollar amount for all cases; to the
contrary, the definition must be applied and determined on
a case by case basis since a given dollar amount which
may be de minimis in one case would not be so in another
based upon the factual circumstances.
As to the instant case, we do believe under these
facts that the amount in question has a de minimis
economic impact. On that basis, we find no violation of
Section 3(a) of Act 9 of 1989.
Schweinsburq, at 18.
As evidenced by Schweinsburq, supra, the de minimis exclusion would apply
where there would be an issue as to whether a private pecuniary benefit, resulting . from
a public official /public employee's use of authority of office, would be economically
insignificant. Since the instant case involves business contracts, the de minimis
exclusion does not apply because the economic consequence is not insignificant.
With regard to your second question, as noted in Advice of Counsel 00 -595, the
Company which employs the Member is a business with which the Member is
associated. Further, because the Company works with the Developer, the Member,
through the Company, has a business relationship with that Developer. It is generally
noted that a conflict of interest exists where a public official /public employee, in his
official capacity, participates, reviews or passes upon a matter involving a business with
which he is associated and /or private clients. Kannebecker, Opinion 92 -010.
In Kannebecker, supra, the Commission considered whether the Ethics Law
would impose any restrictions upon a township supervisor as to individuals who had
matters pending before the township when the supervisor was an attorney for those
individuals in unrelated matters. The Commission stated:
A township supervisor has a conflict as to individuals who
have matters pending before the township when the
supervisor is an attorney for those individuals in unrelated
matters when the attorney - client relationship is ongoing or
when the client is on a retainer. Circumstances could arise
where a conflict may exist even as to past clients.
Rubenstein, 00 -595 -C
September 12, 2000
Page 3
Id., at 6.
Based upon Kannebecker, supra, if the Developer, for whom the Member's
Company would perform work in other municipalities, would have a project within the
Member's municipality, the Member would have a conflict as to that project. Even
though there would be no reasonable expectation that the Company would perform
work on the project, the Member would still have a conflict due to the ongoing business
relationship between the Member and the Developer. In each instance of a conflict, the
Member would have to abstain and observe the disclosure requirements of Section
1103(j) of the Ethics Act.
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: The Member 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. The
de minimis exclusion to the definition of "conflict" or "conflict of interest" does not apply
because the economic consequence is not insignificant. The Company which employs
the Member is a business with which the Member is associated. Further, because the
Company works with the Developer, the Member, through the Company, has a
business relationship with that Developer. If the Developer, for whom the Member's
Company would perform work in other municipalities, would have a project within the
Member's municipality, the Member would have a conflict as to that project. Even
though there would be no reasonable expectation that the Company would perform
work on the project, the Member would still have a conflict due to the ongoing business
relationship between the Member and the Developer. In each instance of a conflict, the
Member would be required to abstain and observe the disclosure requirements of
Section 1103(j) of the Ethics Act. 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 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.
cerel
Vincent J. Dopko
Chief Counsel