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HomeMy WebLinkAbout94-003 ConfidentialI. ISSUE: STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PENNSYLVANIA 17120 OPINION OF THE COMMISSION Before: Daneen E. Reese, Vice Chair Roy W. Wilt Austin M. Lee Allan M. Kluger Joseph W. Marshall, III DATE DECIDED: 04/29/94 DATE MAILED: 05/04/94 Re: Public Official, Section 3(a), Conflict, Private Pecuniary Benefit, Use of Authority of Office, Municipal Authority, Member, Lost Wages, Appeal of Advice. This confidential Opinion is issued pursuant to the Appeal of Confidential Advice of Counsel, No. 94 -535 issued on March 31, 1994. Whether any restrictions or prohibitions are imposed by the Public Official and Employee Ethics Law upon a municipal authority board member from receiving reimbursement from the authority for lost wages in his private employment as a result of attending authority business. II. FACTUAL BASIS FOR DETERMINATION: 94 -003 On April 14, 1994, this Commission received your FAX transmission wherein you appealed the above confidential Advice. The appeal of advice did not delineate the nature of your objection to the Advice of Counsel other than to indicate the exercise of B's right to appeal. By letter dated April 18, 1994 you were notified of the date, time and location of the public meeting. Although you chose not to attend the confidential hearing held on April 29, 1994, you raised the following arguments in a brief which you filed: that a reimbursement is not a salary so that an approval from the governing body is unnecessary; that an expense Confidential Opinion, 94 -003 May 4, 1994 Page 2 incurred in the course of authority business is not salary and is reimbursable; that financial losses are real and ascertainable so as to be actual expenses and that reimbursement does not result from a use of authority of office for a private pecuniary benefit. In his original request, B inquired about being reimbursed by the authority for any compensation he would lose in private employment as a result of attending authority business. As a member of the Board of Directors of the Municipal Authority of A Township, a municipal authority created and existing under the Municipality Authorities Act of 1945, B is required from time to time to spend time away from his usual employment to attend to authority business. In particular he is required to attend collective bargaining sessions, to appear at judicial, administrative and arbitration proceedings, to testify-on behalf of the Authority or in response to subpoenas served on him by adverse parties and to attend seminars and conferences pertaining to the conduct of the authority's affairs and the discharge of his duties as a Board Member. There are times when he loses compensation as a salaried employee at his usual place of employment to attend to the authority matters noted above. B wants to be reimbursed by the authority for any compensation he actually loses when he is involved in authority business. B inquired as to whether it would be violative of the Ethics Law to receive such reimbursement from the authority for compensation he loses when he is required to attend to authority business. In Confidential Advice 94 -535 issued on March 31, 1994, B was advised that the Ethics Law would prohibit him from receiving reimbursement from the authority for lost wages as such would be a use of authority of office to obtain a private pecuniary benefit contrary to Section 3(a) of the Ethics Law. Given the arguments that have been raised in your brief, we will make a de novo review of this matter. III. DISCUSSION: As a Member of the A Municipal Authority, B is a public official subject to the provisions of the Public Official and Employee Ethics Law. Section 3(a) of the Eth Law provides that: Section 3. Restricted Activities (a) No public official or public employee shall engage in conduct that constitutes a conflict of interest. Confidential Opinion, 94 -003 May 4, 1994 Page 3 65 P.S. §403(a). The following term is defined under the Ethics Law: Section 2. Definitions 65 P.S. §402. "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. "Conflict" or "conflict of interest" 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. In addition, Sections 3(b) and 3(c) of the Ethics Law 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 official /employee would be influenced thereby. In resolving the appeal before us, we must review the Municipal Authorities Act to the extent that it impacts upon the Ethics Law regarding the issue of whether the board member would be using the authority of office to obtain a private pecuniary benefit for himself. Confidential Opinion, 91 -001. In this regard, we have held that if a pecuniary benefit is prohibited by law, then the receipt of that benefit through the use of authority of office would be a private pecuniary benefit for the public official /employee contrary to Section 3(a) of the Ethics Law. Confidential Opinion, 91 -001. The Municipality Authorities Act provides: B. Members shall hold office until their successors have been appointed, and they may succeed themselves, and, except members of the boards of Authorities organized or created by Confidential Opinion, 94 -003 May 4, 1994 Page 4 a school district or school districts, shall receive such salaries as may be determined by the governing body or bodies of the municipality or municipalities, but none of such salaries shall be increased or diminished by such governing body or bodies during the term for which the member receiving the same shall have been appointed.... 53 P.S. 309B Advice 94 -535 concluded that since there was no authorization in the Municipality Authorities Act which would allow a board member to receive compensation for lost wages, such was not provided for by law and consequently such would be prohibited by Section 3(a) of the Ethics Law as a private pecuniary benefit. There are no prior Commission opinions on this precise issue other than Taylor, Advice 87 -602 which reached the same result as Advice 94 -535 under Act 170 of 1978. Absent prior precedent, our determination must be made by reviewing the language of the Municipality Authorities Act, 53 P.S. 309, supra. The Municipality Authorities Act clearly dictates that the salaries of the board members must be set by the governing body of the authority. There is no question that the term "salary" is not limited to the compensation of the board members, but would also extend to any reimbursement for lost wages from regular employment due to attending authority business. See Svnoski v. Hazle Township, 93 Pa. Commw. Ct. 168, 500 A.2d 1282 (1985). Since a reimbursement is encompassed within the terms salary or compensation and since such salary must be set by the governing authority, it is clear that the Municipality Authorities Act, and hence the Ethics Law, prohibits action on B's part to obtain reimbursement. If B as an authority member obtains such reimbursement, that action would be a use of authority of office. Juliante, Order 809. In addition, the reimbursement would be a pecuniary benefit since it has a monetary value. Lastly, the pecuniary benefit would be private because the salary must be set by the governing authority and not by the municipal authority or individual members. Our decision is supported by judicial precedent: Rhodes, Rebottini Mance Painter v. State Ethics Commission, filed in Commonwealth Court on November 23, 1993 at dockets 2165 -2168 C.D. 1992. Commonwealth Court, in affirming in part our finding of violation of Western Westmoreland Municipal Authority Board members who created officer positions and set their own salaries, concluded that such action was contrary to the Municipality Authorities Act Confidential Opinion, 94 -003 May 4, 1994 Page 5 which required salaries to be set by the governing authorities: The facts as found by the Commission show that the WWMA board members did more than just vote on their officer election and salaries. They created officer positions specifically to circumvent the § 7B requirement that board member salaries be set by the authority's governing bodies. This is an abuse of public office and is precisely the type of conduct which the Act was attended to prevent. Id. at 10 1 Pa. C.S.A. §1921(a) provides: (a) The object of all interpretation and construction is to ascertain and effectuate the intention of the General Assembly. Every statute shall be construed, if possible, to give effect to all its provisions. There is nothing in the Municipality Authorities Act which authorizes a reimbursement nor is there anything indicative of a legislative intent to allow such a pecuniary benefit. The General Assembly does know how to legislate authorizations for such types of reimbursements. See the Second Class Township Code, 53 P.S. 65 612. The arguments made in your brief have been dispelled in the above analysis. The assertion that a reimbursement is not a salary is contrary to decisional law. Second, even if an "expense" were incurred for lost wages, a reimbursement would be a benefit so as to be encompassed within the term salary. By virtue of being an authority board member and obtaining reimbursement, such action would be a use of authority of office. Juliante, supra. The reimbursement would be a pecuniary benefit which is private since it is not authorized in law. Painter, Order 861. When individuals accept these types of positions, they do so knowing the demands of the office and the limitations of the salary. There is also a certain amount of flexibility in the position to reduce or minimize time that must be taken from private employment to attend to authority business. Fob example, many activities such as labor negotiations may be done after hours at the convenience of the parties. It is for the governing body, and not the authority members, to take such factors into consideration in setting the salary of those members. Although the Ethics Law would prohibit B from giving himself reimbursement for lost wages which would be a use of authority of Confidential Opinion, 94 -003 May 4, 1994 Page 6 office to obtain a private pecuniary benefit, there is no such prohibition for the governing authority in the exercise of its statutory discretion to set the salary of the authority board members. Said governing authority could obviously take various factors into consideration, such as "lost wages ", in setting the salary of the authority board members. However, such is a statutory function of the governing authority; such is not a power that the authority board or a member has under the Municipality Authorities Act. Lastly, it would appear that any such action by the governing authority would not be effective during the terms of the current appointments. Confidential Advice of Counsel 94 -535 is affirmed and the appeal is denied. IV. CONCLUSION: A board member of a municipal authority is a public official subject to the provisions of the Ethics Law. Section 3(a) of the Ethics Law would prohibit a municipal authority board member from seeking reimbursement from the authority for lost wages as to regular employment which resulted from attending authority business. Confidential Advice of Counsel 94 -535 is affirmed and the appeal is denied. Pursuant to Section 7(10), the person who acts in good faith on this opinion issued to him shall not be subject to criminal or civil penalties for so acting provided the material facts are as stated in the request. such. This letter is a public record and will be made available as Finally, any person may request the Commission to reconsider its Opinion. The reconsideration request must be received at this Commission within fifteen days of the mailing date'of this Opinion. The person requesting reconsideration should present a detailed explanation setting forth the reasons why the Opinion requires reconsideration. By the Commission, A /UtiVa)6 Daneen E. Reese Vice Chair