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Home My WebLink About82-006 FieldsIII. Applicable Law: Mr. Robert J. Fields, Esquire Fields and Blanco Box 329, Honesdale Road Waymart, PA 18472 ZSP ,(E r r),� STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PENNSYLVANIA 17120 April 20, 1982 OPINION OF THE COMMISSION RE: Council Member - Partner is Borough Solicj.tur Dear Mr. Fields: I. Issue: 006 Does service as a Borough Council member create a conflict of interest or violate the Ethics Act when the member's professional partner serves the Borough simul- taneously as solicitor? II. Factual Basis for Determination: You and a partner currently engaged in the general practice of law. Fees or wages received from solicitorships, however, are treated by you and your partner as individual income respectively. Such income is not included in your partnership income. Presently, your partner is solicitor for the Borough in which you reside. You have been asked to serve as a Councilman in the Borough to fill an existing vacancy. You question . whether acceptance of this position would violate the Ethics Act, given your partner's simultaneous employment by the Borough. The Law to be applied to this question is as follows: Section 3(a) Restricted Activities. (a) No public official or public employee shall use his public office or any confidential informa- tion received through his holding public office to obtain financial Robert J. Fields, Esq. April 20, 1982 Page 2 gain other than compensation provided by law for himself, a member of his immediate family, or a business with which he is associated. 65 PS. 403(a). (c) No public official or public employee or a member of his immediate family or any business in which the person or a member of the person's immediate family is a director, officer, owner or holder of stock exceeding 5% of the equity at fair market value of the business shall enter into any contract valued at $500 or more with a governmental body 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. Any contract made in violation of this subsection shall be voidable by court of competent jurisdiction if the suit is commenced within 90 days of making of the contract. Section 1 Purpose. The Legislature hereby declares that public office is a public trust and that any effort to realize personal financial gain through public office other than compensation provided by law is a violation of that trust. In order to strengthen the faith and confidence of the people of the State in their government, the Legislature further declares that the people have the right to be assured that the financial interests of holders of or candidates for public office present neither a conflict nor the appearance of a conflict with the public trust. Because public confidence in government can best be sustained by assuring the people of the impartiality and honesty of public officials, this act shall be liberally construed to promote complete disclosure. 65 P.S. 401. Robert J. Fields, Esq. April 20, 1982 Page 3 IV. Discussion: Should you 'become a member of the Borough Council, you will be a public official subject to the Ethics Act, 65 P,S 401 et seq. The Act in Section 1 identifies public office as a public trust and mandates that the financial interests of holders of public office present neither a conflict nor the appearance of a conflict with the public trust. You and your partner serving as Borough Council member and solicitor, respectively, would not constitute a per se conflict of interest in violation of the Ethics Act. In order to avoid even the appearance of a conflict of interest, however, you must abstain from Borough Council decisions regarding the appointment or re- appointment of its solicitor as well as actions pertaining to litigation activities which would increase fee payments to the solicitor. Besides requiring your abstention from voting on this matter, the Ethics Act would not preclude your accepting the position on. the Council. See Shirk, 80 -024. Under the restrictions of Section 3(a), of course, you could not use your office or any confidential information obtained therefrom to obtain financial gain other than compensation provided by law for yourself, a member of your immediate family or a business with which you are associated. In addition, should your association with the solicitor be such that you would be a director, officer, owner or holder of stock exceeding 5% of the equity at fair market value of the business, the requirements of Section 3(c) of the Ethics Act would be applicable. Specifically, if the solicitor and you stood in such a relationship and if the borough contracted with the solicitor in an amount over $500, the contract must be awarded only after an open and public process. In holding the "open and public" provisions of Section 3(c) of the Ethics Act applicable to personal services contracts such as that between the municipality and its solicitor, we realize that these contracts under the circum- stances described in Section 3(c) may have to be handled differently from the usual requirements of your municipal code. Typically, municipal codes exempt "personal" or "professional" services from their "bidding" requirements. See Borough Code at 53 P.S. 46402(d)(5); City Codes, 53 P.S. 12671 (1st Class), 53 P.S. 23308.1 (2nd Class), and 53 P.S. 36901(d)(5) (3rd Class); Incorporated Towns, 53 P.S. 53202(d)(5); and Township Codes, 53 P.S. 56802(d) (1st Class) and 53 P.S. 65802(e)(5) (2nd Class). However, the purpose for these exceptions has generally been to free the municipality from mandatory acceptance of the lowest "bidder." Commonwealth v. Tice, Robert J. Fields, Esq. April 20, 1982 Page 4 272 Pa. 447(1922). The purpose of this exception from "bidding" requirements is manifestly different from the purpose of the Ethics Act in general and Section 3(c) of the Ethics Act in particular. The purpose of the Ethics Act, as expressed in Section 1 of the Ethics Act is to strengthen the faith of the public in their government. Section 3(c), in this case, requires an open and public process in the award of contracts by a municipality to its own public employees /officials, their wives, etc. It is obvious that adherence to the open /public process of Section 3(c), if applied to personal /professional contracts, as well as to contracts for goods, will help alleviate the fear that "insiders" (public employees /officials, their wives and businesses) are "favored" in such employment. Given the fact that the Legislature clearly demonstrated an ability to write exceptions for personal /professional services contracts in other codes and did not do so in the Ethics Act, we must conclude that application of Section 3(c) to such contracts was intended by the Legislature. Applying Section 3(c) to such contracts effects the clear language of the Ethics Act as well as implementing its purpose. In this interpretation and application we do not imply or find a requirement in Section 3(c) that the formal bid process with legal advertisements, etc. is required. Nor do we find that the municipality, in such circumstances, would be obligated, after the open /public process, to award the contract to the lowest "bidder ". Compare American Totalisator Co. v. Seligman, 27 Pa. Cmwlth. 639(1976). As stated previously by this Commission, a "reasonableness" test is to be applied in determining whether the open /public requirements of Section 3(c) have been met. Howard, 79 -044. Thus, before a public employee /official, his immediate family or business as described in Section 3(c) is awarded a personal /professional contract by the municipality he /she serves, there must be: (1) prior public notice of the contract possibility; (2) sufficient time for a reasonable and prudent competitor to be able to prepare and submit a proposal /application; (3) public disclosure of all proposals /applications considered; and (4) public disclosure of the contract awarded or offered /accepted. Robert J. Fields, Esq. April 20, 1982 Page 5 V. Conclusion: You will not violate the Ethics Act by serving as councilman for the same Borough your partner serves as solicitor. You must abstain, however, from Council deci- sions regarding its appointment or re- appointment of its solicitor and or matters pertaining to decisions which would increase fee payments to the solicitor, as well as follow the other provisions of the Act. If you and the solicitor stand in a relationship as outlined above, in this case, any contract in excess of $500 between the Borough and the solicitor must follow only after an open and public process. Pursuant to Section 7(9)(i), this Opinion is a complete defense in any enforcement proceeding initiated by the Commission, and evidence of good faith conduc in any 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. PJS /na PA L J. S T Chairman