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HomeMy WebLinkAbout20-532 Hollywood PHONE: 717-783-1610 STATE ETHICS COMMISSION FACSIMILE: 717-787-0806 TOLL FREE: 1-800-932-0936 FINANCE BUILDING WEBSITE: www.ethics.pa.gov 613 NORTH STREET, ROOM 309 HARRISBURG, PA 17120-0400 ADVICE OF COUNSEL August 3, 2020 To the Requester: Andrew J. Hollywood 20-532 Dear Andrew J. Hollywood: This responds to your undated letter received July 6, 2020, by which you requested Issue: Pa.C.S. § 1101 et seq., would impose prohibitions or restrictions upon a borough council member, who in a private capacity is employed as a systems administrator with a corporation that owns a number of subsidiaries, with regard to voting to approve: (1) the placement of legal/public notices in a newspaper published by a subsidiary owned by the corporation; (2) the payment of monthly invoices for telephone/cable/internet services provided to the borough by subsidiaries owned by the corporation; or (3) the payment of invoices for occasional construction or IT services provided to the borough by subsidiaries owned by the corporation. Facts: You request an advisory from the Commission based upon submitted facts that may be fairly summarized as follows. You are a In a private capacity, you are employed with a corporation named Pencor Services, Inc. as a systems administrator. Pencor owns a number of subsidiaries, including Palmerton Telephone Company, The Times News, Times News Printing, Pencor Construction, Pencor Hydraulic Hose and Fittings, Pencor Electric, PenTeleData, and Blue Ridge Cable. The Borough utilizes subsidiaries owned by Pencor for the provision of ongoing telephone/cable/internet services and occasional construction and IT services. The Borough also places legal/public notices in the local newspaper published by The Times News. Each month the Borough approves the payment of invoices, including monthly invoices for the telephone/cable/internet services provided to the Borough by subsidiaries owned by Pencor. Hollywood, 20-532 August 3, 2020 Page 2 Based upon the above submitted facts, the following questions are presented by your advisory request: (1) Whether you would be required to abstain from votes to approve the placement of Borough legal/public notices in the local newspaper published by The Times News; (2) Whether you would be required to abstain from monthly votes to approve the payment of monthly invoices for telephone/cable/internet services provided to the Borough by subsidiaries owned by Pencor; (3) Whether you would be required to abstain from votes to approve the payment of non-monthly invoices for occasional construction or IT services provided to the Borough by subsidiaries owned by Pencor; and (4) If you would be required to abstain from monthly votes to approve the payment of monthly invoices for telephone/cable/internet services provided to the Borough by subsidiaries owned by Pencor, would you be permitted at the beginning of the year by which you would abstain from all of those monthly votes as a whole rather than abstaining from each monthly vote on an individual basis. Discussion: It is initially noted that pursuant to Sections 1107(10) and 1107(11) of the Ethics Act, 65 Pa.C.S. §§ 1107(10), (11), advisories are issued to the requester based upon the facts that the requester has submitted. In issuing the advisory based upon the facts that the requester has submitted, the Commission does not engage in an independent investigation of the facts, nor does it speculate as to facts that have not been submitted. It is the burden of the requester 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 requester has truthfully disclosed all of the material facts. As a Borough Council Member, you are a public official subject to the provisions of the Ethics Act. Sections 1103(a) and 1103(j) of the Ethics Act provide: § 1103. Restricted activities (a) Conflict of interest.--No public official or public employee shall engage in conduct that constitutes a conflict of interest. (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 Hollywood, 20-532 August 3, 2020 Page 3 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(a), (j). The following terms related to Section 1103(a) are defined in the Ethics Act as follows: § 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. 65 Pa.C.S. § 1102. S 65 Pa.C.S. § 1102, 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. In each instance of a conflict of interest, the public official/public employee would be required to abstain from participation. The abstention requirement would not be limited merely to voting, but would extend to any use of authority of office including, but not limited to, discussing, conferring with others, and lobbying for a particular result. Juliante, Order Hollywood, 20-532 August 3, 2020 Page 4 809. Subject to certain statutory exceptions, in each instance of a voting conflict, Section 1103(j) of the Ethics Act would require the public official/public 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. Kistler v. State Ethics Commission, 610 Pa. 516, 22 A.3d 223 (2011), in order to violate Section 1103(a) of the Ethics Act, a public official/public employee: such a way as to put his \[office/public position\] to the purpose of obtaining for himself a private pecuniary benefit. Such directed action implies awareness on the part of the \[public official/public employee\] of the potential pecuniary benefit as well as the motivation to obtain that benefit for himself. Kistler, supra, 610 Pa. at 523, 22 A.3d at 227. To violate Section 1103(a) of the Ethics benefit for himself, his family, or his business, and then must take action in the form of Id., 610 Pa. at 528, 22 A.3d at 231. In applying the above provisions of the Ethics Act to the instant matter, you are advised as follows. Pencor is a business with which you are associated in your capacity as an employee. The submitted fact that an entitysuch as Palmerton Telephone Company, The Times News, Times News Printing, Pencor Construction, Pencor Hydraulic Hose and Fittings, Pencor Electric, PenTeleData, or Blue Ridge Cableis a subsidiary of Pencor, Subsidiary a business with which you are associated. Cf., Confidential Opinion, 92-003 at 6 (regarding parent and subsidiary corporations); Pertile, Advice 10-610. Therefore, you are advised that unless there would be a basis for a conflict of interest such as a private pecuniary benefit to you, a member of your immediate family, or a business with which you or a member of your immediate family is associated such as Pencor, you would not have a conflict of interest under Section 1103(a) of the Ethics Act with regard to voting to approve: (1) the placement of Borough legal/public notices in the local newspaper published by The Times News, which is a Pencor Subsidiary; (2) the payment of monthly invoices for telephone/cable/internet services provided to the Borough by Pencor Subsidiaries; or (3) the payment of non-monthly invoices for occasional construction or IT services provided to the Borough by Pencor Subsidiaries. You are further advised that to the extent the payment of such aforesaid monthly invoices would result in a private pecuniary benefit to you, a member of your immediate family, or a business with which you or a member of your immediate family is associated such as Pencor, you would not have a conflict of interest under Section 1103(a) of the Ethics Act with regard to voting to approve the payment of a standard monthly telephone/cable/internet service invoice issued by a Pencor Subsidiary that is pre-fixed, routine, and uncontested. Pizonka/Rieder/Rittenhouse, Opinion 09-007 (Citing Yezzi, Order 825 at 58; Krushinski, Order 168; Brooks, Opinion 89-023; Maholick, Opinion 90- 010). However, you would have a conflict of interest under Section 1103(a) of the Ethics Act with regard to voting to approve the payment of any monthly telephone/cable/internet service invoice issued by a Pencor Subsidiary that would not meet the aforesaid criteria. Pizonka/Rieder/Rittenhouse, supra. You are additionally advised that Section 1103(j) of the Ethics Act does not provide voting conflicts that may arise on a recurring basis. Pursuant to Section 1103(j) of the Ethics Act, in each instance of a conflict of interest, you would be required to abstain from participation, which would include voting unless one of the Hollywood, 20-532 August 3, 2020 Page 5 statutory exceptions of Section 1103(j) would be applicable. Additionally, you would be required to satisfy the disclosure requirements of Section 1103(j) of the Ethics Act each time a voting conflict would arise, such that prior to the vote being taken, you would be required to publicly announce and disclose the nature of your 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. 65 Pa.C.S. § 1103(j). 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 Borough Code. Conclusion: Based upon the submitted facts that: (1) you are a Member of Council for Palmen a private capacity, you are employed with Pencor Services, Inc. (3) Pencor owns a number of subsidiaries, including Palmerton Telephone Company, The Times News, Times News Printing, Pencor Construction, Pencor Hydraulic Hose and Fittings, Pencor Electric, PenTeleData, and Blue Ridge Cable; (4) the Borough utilizes subsidiaries owned by Pencor for the provision of ongoing telephone/cable/internet services and occasional construction and IT services; (5) the Borough also places legal/public notices in the local newspaper published by The Times News; and (6) each month the Borough approves the payment of invoices, including monthly invoices for the telephone/cable/internet services provided to the Borough by subsidiaries owned by Pencor, you are advised as follows. As a Borough Council Member, you are a public official subject to the provisions 65 Pa.C.S. § 1101 et seq. Pencor is a business with which you are associated in your capacity as an employee. The submitted fact that an entitysuch as Palmerton Telephone Company, The Times News, Times News Printing, Pencor Construction, Pencor Hydraulic Hose and Fittings, Pencor Electric, PenTeleData, or Blue Ridge Cableis a subsidiary of Pencor, hereinafter referr Subsidiary a business with which you are associated. Therefore, you are advised that unless there would be a basis for a conflict of interest such as a private pecuniary benefit to you, a member of your immediate family, or a business with which you or a member of your immediate family is associated such as Pencor, you would not have a conflict of interest under Section 1103(a) of the Ethics Act with regard to voting to approve: (1) the placement of Borough legal/public notices in the local newspaper published by The Times News, which is a Pencor Subsidiary; (2) the payment of monthly invoices for telephone/cable/internet services provided to the Borough by Pencor Subsidiaries; or (3) the payment of non-monthly invoices for occasional construction or IT services provided to the Borough by Pencor Subsidiaries. You are further advised that to the extent the payment of such aforesaid monthly invoices would result in a private pecuniary benefit to you, a member of your immediate family, or a business with which you or a member of your immediate family is associated such as Pencor, you would not have a conflict of interest under Section 1103(a) of the Ethics Act with regard to voting to approve the payment of a standard monthly telephone/cable/internet service invoice issued by a Pencor Subsidiary that is pre-fixed, routine, and uncontested. However, you would have a conflict of interest under Section 1103(a) of the Ethics Act with regard to voting to approve the payment of any monthly telephone/cable/internet service invoice issued by a Pencor Subsidiary that would not meet the aforesaid criteria. You are additionally advised that Section 1103(j) of the Ethics Act (pertaining to arise on a recurring basis. Pursuant to Section 1103(j) of the Ethics Act, in each instance Hollywood, 20-532 August 3, 2020 Page 6 of a conflict of interest, you would be required to abstain from participation, which would include voting unless one of the statutory exceptions of Section 1103(j) would be applicable. Additionally, you would be required to satisfy the disclosure requirements of Section 1103(j) of the Ethics Act each time a voting conflict would arise, such that prior to the vote being taken, you would be required to publicly announce and disclose the nature of your 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. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Pursuant to Section 1107(11) of the Ethics Act, 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 requester 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). 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. Sincerely, Robin M. Hittie Chief Counsel