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HomeMy WebLinkAbout94-009 ConfidentialI. ISSUE: DATE DECIDED: DATE MAILED: STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PENNSYLVANIA 17120 OPINION OF THE COMMISSION Before: James M. Howley, Chair Daneen E. Reese, Vice Chair Roy W. Wilt Austin M. Lee Allan M. Kluger John R. Showers 12/15/94 12/27/94 Re: Conflict, Public Official /Employee, School District, Superintendent, Solicitor, Collective Bargaining Agreement, Superintendent's Salary Affected By Increase In Teacher Salary, Negotiations, Group Medical Insurance /Prescription Coverage. This Opinion is issued in response to your confidential requests of October 7, 1994 and October 10, 1994. Whether the Public Official and Employee Ethics Law presents any prohibition or restrictions upon a school district superintendent or solicitor regarding participation in the collective bargaining agreement with the teacher's union when the contract may affect the annual salary increment of the superintendent and when the superintendent or solicitor may receive medical insurance and prescription coverage vaid by the school district. II. FACTUAL BASIS FOR DETERMINATION: 94 -009 As Solicitor for the A School Board, you seek an opinion for the District Superintendent concerning his participation as a negotiator or otherwise in an "early bird" process with the local education association relative to a new collective bargaining Confidential Opinion, 94 -009 December 27, 1994 Page 2 agreement which would be effective September, 1995. The current Superintendent, B was given a new appointment as of September of 1994 with the contract effective August 1, 1995 through July 31, 2000. In addition to various fringe benefits and salary, the contract for the Superintendent would include the following: "4. Compensation (a). Effective August 1, 1995 and each contract year thereafter, the Superintendent will receive an increase in base of 1.6 times the dollar value increase to be received by the District teachers on the last step of the Master's Degree salary schedule for the upcoming school year. However, the base salary increase for the Superintendent will neither be less than $2,800 annually nor greater than $3,800 annually . . 5. (a) The Superintendent shall receive additional benefits each year of his term at no cost to him as set forth below. (b) Blue Cross and Blue Shield coverage for the Superintendent and his wife and minor children as provided and the same extent as to the District's group coverage under the Professional Employees Labor Agreement. (e) Family prescription service with the deductible as provided and to the same extent as the District's group coverage under the Professional Employees' Labor Agreement." You inquire as to whether any of the following scenarios by B would constitute a conflict of interest under the Ethics Law: "(1) If the Superintendent were the Chief Negotiator? (2) If the Superintendent were a member of the negotiating team? (3) If the Superintendent did not actively participate in the negotiations as a member of the negotiating team, but were available for consultation? (4) If the Superintendent were informed of the bargaining team's negotiating instructions as to the dollar amount of any potential increase in base salary? (5) In the event that instructions included an increase or deductible or copayments for medical insurance or prescriptions? Confidential Opinion, 94 -009 December 27, 1994 Page 3 (6) Does it make any difference if the School Board would not consider any teacher salary increase which would result in paying anything more than $2,800 minimum to the Superintendent, i.e. not exceeding $1,750 for the teachers (1.6 x 1,750 = $2,800) ?" Since the Superintendent is not a voting member of the School Board, he cannot vote on any proposed contract. A concern exists as to whether there is a potential conflict because B would be a negotiator and the messenger by which information is relayed between the Board and union representatives about what either side's bottom line negotiating positions are. As to C, the District Solicitor, he as part of his retainer receives $50.00 per month for certain services plus the same group medical insurance and prescription coverage, available to the professional employees and administrators, provided by the District at no cost. The Solicitor is appointed and serves at will with no guarantee of any advance notice in the event of termination. If the School Board desires to increase the costs of deductibles or copayments for any of the insurance coverages, the issue exists as to whether the Solicitor would be "conflicted out" as to any of the following situations: "(1) May the Solicitor be a negotiator? (2) May the Solicitor, although not a negotiator, be an advisor to the negotiating team during bargaining? (3) May the Solicitor give legal opinions on matters of contracting language generally or by excluding reference to anything relating to the insurance benefits ?" After setting forth the above scenarios and questions regarding the Superintendent and Solicitor and after noting the exceptions to the statutory definition of conflict regarding de minimis economic impact and matters which effect to the same degree a class or subclass consisting of a group, you ask whether the above activities would be excepted from the definition of conflict of interest. By separate letter, B restates the above submitted facts by noting that he has received a five year contract extension wherein the compensation clause provides for an increase in base salary of 1.6 times the dollar value increased to the District teachers as to the last step of the Master's Degree salary within a range from $2,800 to $3,800 dollars per annum. The School Board in executive session has indicated that they Confidential Opinion, 94 -009 December 27, 1994 Page 4 would consider a raise to the teachers of D if the teachers are willing to work one additional hour per week or two additional workdays to the yearly school calendar. The question is whether Superintendent B at the request of the Board may participate in the early bird discussions regarding the above salary limits for teachers given the fact that B's base salary increase could be affected by as much as a $1,000 which represents the differential between the minimum and maximum increase allowable for the Superintendent. III. DISCUSSION: It is initially noted that pursuant to Sections 7(10) and 7(11) of the Ethics Law, 65 P.S. § §407(10), (11), advisories are issued to the requestor based upon the facts which the requestor has submitted. In issuing this advisory based upon the facts which the requestor has submitted, this 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 P.S. § §407(10), (11). An advisory only affords a defense to the extent the requestor has truthfully disclosed all of the material facts. As Superintendent for A School Board, B is a public official as that term is defined under the Ethics Law, and hence he is subject to the provisions of that law. In addition, as Solicitor for A School Board, C is a public official /employee as that term is defined under the Ethics Law, and hence he is subject to the provisions of that law. Spataro, Opinion 89 -009. Section 3(a) of the Ethics Law provides: Section 3. Restricted Activities. (a) No public official or public employee shall engage in conduct that constitutes a conflict of interest. The following terms are defined in the Ethics Law as follows: Section 2. 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 Confidential Opinion, 94 -009 December 27, 1994 Page 5 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 the vote, official action, or judgement 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 3(j) of the Ethics Law provides as follows: Section 3. Restricted activities (j) 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 Confidential Opinion, 94 -009 December 27, 1994 Page 6 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. If a conflict exists, Section 3 official /employee to abstain and to abstention and reasons for same, both written memorandum to that effect with minutes or supervisor. (j) requires the public publicly disclose the orally and by filing a the person recording the On the issue of participation by a public official /employee as to the contract negotiation process on behalf of the School Board with the teacher's union, we have already addressed this issue on several occasions. Krier, Opinion 84 -002, Blaney, Opinion 84 -003, Van Rensler Opinion 90 -017. In Van Rensler the issue was whether the Ethics Law prohibited school board directors from participating on a negotiating team and voting on a collective bargaining agreement when members of their immediate families were school district employees represented by the bargaining concluded that the Ethics Law would not prohibit the school board directors from voting on the finalized agreement, but the school board directors were restricted as to the negotiations leading to the finalized agreement. We held that the school board directors could vote on the finalized agreement because of the exclusion in the definition of "conflict or conflict of interest" which applies if the immediate family member is a member of a subclass consisting of an industry, occupation or other group containing more than one member and the family member would be affected no differently than the other members of the subclass. We concluded that if these two prerequisites for applying the exclusion were met, the school directors could vote on the final collective bargaining agreement. We held that the Ethics Law precluded the participation of the school directors in the negotiation process based upon our concern that public officials must be impartial and their private interests must be sufficiently separated from their public duties. Van Rensler, at 4, citing Krier. We referenced the definition of "conflict of interest" in Act 9 of 1989 as specifically prohibiting a public official or employee from using confidential information relating to the family members' bargaining unit. The risk of disclosure of that information was held to preclude the school board directors from participating in negotiations where family members are part of the bargaining unit. In so holdin negotiation process would be free of any g� the y influence and the Confidential Opinion, 94 -009 December 27, 1994 Page 7 potential for the use of confidential information would be "minimized if not eliminated ". Id, at 4 -5. Thus, a fundamental basis for the Van Rensler Opinion was precluding the potential for the use of confidential information obtained through public office as school board director during the bargaining process with the teachers' union. In applying the above general principles to the questions in this case, we will first consider the Superintendent's participation in the collective bargaining process. The fact that the Superintendent's base salary is tied into the salary schedule of the teachers creates a conflict in our view. The Superintendent as a representative of the School Board would be duty bound to negotiate to effectuate a contract which is favorable to the position of the School Board. However, given the fact that the Superintendent's annual salary increment is tied into the teacher's salary, a conflict exists because of the pecuniary benefit which will result in that the higher teacher salaries will result in a higher yearly increment to the Superintendent within the minimum /maximum range. We see no material distinction as to whether the Superintendent would be a chief negotiator, a member of the negotiating team or a non - active participant available for consultation given the very broad application of the definition of use of authority of office. Juliante, Order 809. As to whether the Superintendent could merely receive information or whether he could participate if the Board would not entertain any increase other than the minimum required, we must conclude under either of those two scenarios that no conflict would exist; under the first scenario, the mere receipt of information by the Superintendent with no action on his part would not be a use of authority of office and under the second scenario the receipt by the Superintendent of the minimum that he is guaranteed would not result in a private pecuniary benefit. We do have a concern if the Superintendent would receive this information and act upon it or if the Superintendent participates and receives more than the minimum amount for his annual salary increment. If the Superintendent chooses to proceed under either of these two scenarios, he will be at risk under the Ethics law if future events do not occur as they are posited. We are aware of the two statutory exclusions within the definition of conflict of interest relating to matters having a de minimis economic impact and matters involving a class of the general public or a subclass of a group, occupation or profession. Neither one of these exclusions are applicable as to the matter of the salary for the Superintendent. The yearly salary increase by no means is de minimis. See, Schweinsberq, Order 900. As to the class /subclass exclusion, that provision of the Ethics Law is clearly inapplicable in that the Superintendent is not part of a Confidential Opinion, 94 -009 December 27, 1994 Page 8 class or subclass but is only one person as to his one particular position and unique salary arrangement as Superintendent. Davis Opinion 89 -012. See Turning to the issue of the group medical insurance/ prescription coverage, we do not see a problem of participation by the Solicitor or Superintendent as to this process in that it appears that they both would be obtaining coverage which is available to the professional employees and administrators; such coverage would extend to a subclass consisting of more than one person. We assume that the coverage received by the Superintendent and Solicitor would be no different than the coverage received by the other members of the subclass. As to the Superintendent, however, we must once again make a cautionary note that we have difficulty perceiving how the Superintendent could limit his involvement or actions as to the matter of the medical insurance and prescription coverage as to which he would have no conflict and as to the salary negotiations as to which he would have a conflict. Under such circumstances, it would seem that prudence would dictate recusal by the Superintendent as to both matters. As to the Solicitor, the fact that he may receive medical insurance/ prescription coverage as part of the professional employees and administrators would not bar him from acting as negotiator or an advisor to the negotiating bargaining team or as counsel to give legal opinions on matters of contract language. As noted above, the subclass exclusion would be applicable provided there is more than one member of the subclass and provided no member of the subclass is treated any differently from the other members. Davis, supra. The propriety of the proposed conduct has only been addressed under the Ethics Law; the applicability of any other statute, code, ordinance, regulation or other code of conduct other than the Ethics Law has not been considered in that they do not involve an interpretation of the Ethics Law. Specifically not addressed herein is the applicability of the Public School Code. In addition, the New Rules of Professional Responsibility as to the Solicitor's conduct is not addressed herein. IV. CONCLUSION: A school district superintendent is a public official subject to the provisions of the Ethics Law. A school district solicitor is a public official /employee subject to the provisions of the Ethics Law. A school district superintendent would have a conflict under Section 3(a) of the Ethics Law regarding participation in the collective bargaining process between the school board and the teacher's union where the superintendent's yearly salary increases Confidential Opinion, 94 -009 December 27, 1994 Page 9 is determined to an extent based upon the average teacher's salary in the negotiated contract. If the Superintendent's salary would be the minimal increase to which he is entitled, the Ethics Law would not bar his participation; likewise, the mere receipt of information by the Superintendent without any action on his part would not bar his participation. As to matters of participation by the Solicitor or Superintendent concerning medical insurance /prescription coverage which is available to the professional employees and administrators, the Ethics Law would not prohibit such participation subject to the qualifications noted above. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Law. The propriety of the proposed conduct has only been addressed under the Ethics Law; the applicability of any other statute, code, ordinance, regulation or other code of conduct other than the Ethics Law has not been considered in that they do not involve an interpretation of the Ethics Law. 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, James M. How Chair