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HomeMy WebLinkAbout403 PohlMs. Irene Pohl 227 Harrison Road Turtle Creek, PA 15145 Re: 85 -05 -C Dear Mr. Pohl: STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PENNSYLVANIA 17120 ORDER OF THE COMMISSION August 14, 1985 Order No. 403 The State Ethics Commission has received a complaint regarding you and a possible violation of Act 170 of 1978. The Commission has now completed its investigation. The individual allegations, conclusions, and findings on which those conclusions are based are as follow: I. Allegation: That you, a Wilkins Township Commissioner, violated Section 3(a) of the Ethics Act, Act 1978 -170 by having the township pay for a hospitalization /medical plan in which you participate. A. Findings: 1. You are an elected public official serving in Wilkins Township; you have been serving as a commissioner since January, 1984. You are chairwoman of the Department of Public Works, Roads and Repairs and supervise roadwork and inspect existing roadways. 2. Wilkins Township has a population of 8,472 (1980 census). 3. You are not employed by the township except in the capacity of commi ssioner. 4. You received $1,200 salary per year as commissioner. 5. Medical and hospitalization insurance for township employees and commissioners is administered by the Municipal Employers Insurance Trust, Administrative Office, 1514 Union Bank Building, Pittsburgh, Pennsylvania 15222. (Hereinafter MEIT), Ms. Irene Pohl Page 2 (a) 1984: $273.90 for Dental and Drug Prescription coverage from February through December. August 14, 1985 6. MEIT invoices record the following payments for your Blue Cross /Shield coverage. (b) 1985: $83.31 for Dental and Drug prescription from January through March. The township is continuing to make these payments. (c) The solicitor, John Means, stated that he believes you are entitled to Blue Cross and Blue Shield coverage according to the Township Ordinance and First Class Township Code. 7. In 1979 the township auditors questioned the insurance payments but had no more questions when they were informed of the provisions of Act 72 -1977. 8. On February 13, 1978, Wilkins Township adopted Resolution No. 5 -78 "Authorizing the inclusion of the members of the Board of Commissioners as subscribers to the Township Group Hospitalization Plan." It stated the following: (a) The commissioners were eligible to participate in the township's Group Hospitalization Plan pursuant to Act 72 of 1977. (b) Several commissioners had expressed their desire to become members of the plan. 9. Act 72 -1977, in part, provides that each commissioner shall "receive a salary of not more than ...twelve hundred dollars per year in townships having a population of four thousand and not more but less than ten thousand." 10. Act 72 -1977 was signed into law by the Governor on November 9, 1977 and was effective immediately. It amended Section 703 of the First Class Township Code as follows: (a) By removing the phrase as full compensation" from the last sentence; "Such salaries shall be payable monthly or quarterly [as full compensation] for the duties imposed by the provisions of this Act. 11. The November 11, 1977 edition of the Legislative Newsletter of the Pennsylvania State Association of Township Commissioners included the following Statement: Township commissioners would be permitted to receive other forms of compensation in addition to their salaries under House Bill 571. Section 203 of the First Class Township Code would be amended by removing the words as full Ms. Irene Rohl _Page 3 13. At the Township regular meeting September 10, 1984, the Secretary reviewed the following documents concerning medical insurance for the Commissioners. h. You chose only Dental and Prescription coverage. August 14, 1985 compensation" from the paragraph...the amendment would thus allow among other things township commissioners to receive such benefits as health, life insurance, and pensions paid for by their township. 12. On February 12, 1985, Mr. Wilmer K. Baldwin, Secretary - Manager of Wilkins Township forwarded a copy of a letter which had recently been received by the township. (a) The letter was written by David B. Glancey, Legislative Assistant in the Pennsylvania Senate and was written to the Honorable Amos K. Hutchinson, a member of the Pennsylvania House of Representatives. (b) Mr. Glancey stated that in [his] opinion, (emphasis added) the effect of the amendment to Section 703... deleting the 'full' before the term 'compensation' will permit compensation for the commissioners to be more - comprehensive and to include more than mere remuneration for service in the elected position of commissioner. For example, ...health and life insurance and death and pension benefits." (a) The 1984 budget for medical insurance for members of the Board of Commissioners which was $8,679. (b) Resolution 5 -78 of February 13, 1978 authorizing participation in programs based on State Act 72 of 1977 which amended Section 703 of the First Class Township Code. (c) Act 72 of 1977 signed by the Governor on November 9, 1977. (d) Legislative letter No. 13 of November 11, 1977 of the Pennsylvania State Association of Township Commissioners indicating the intent of legislation which became Act 72. 14. You admit the township paid the premiums for your Dental and Drug Prescription prescription coverage. a. When you were sworn into office you were told the health care package was available to you Ms. Irene Pohl : Page 4 B. Discussion: Section 3. Restricted activities. (a) No public official or public employee shall use his public office or any confidential information received through his holding public office to obtain financial gain other than compensation provided by law for himself, a member of his immediate family, or a business with which he is associated. 65 P.S. 403(a). The First Class Township Code provides that: §55703. Compensation. Each township commissioner shall receive a salary of not more than eight hundred dollars per year in townships having a population of less than four thousand, not more than twelve hundred dollars per year in townships having a population of four thousand and more but less than ten thousand, not more. than fifteen hundred dollars per year in townships having a population of ten thousand and more but less than fifteen thousand, not more than twenty -four hundred dollars in townships having a population of not less than fifteen thousand and not more than twenty -five thousand, and not more than three thousand dollars in townships having a population in excess of twenty -five thousand. Such salaries shall be payable monthly or quarterly for the duties imposed by the provisions of this act. 53 P.S. 55703. August 14, 1985 The State Ethics Commission has previously reviewed the question of whether these type of insurance coverages constitute financial gain within the above provision of law. See Krane, 84 -001 and Davis, 84 -012. In Krane and Davis the Commission determined that such benefits constituted financial gain. We will adopt the analysis in those Opinions as applicable here and move to the question of whether these coverages are "provided by law" to be paid for by the Township. We have previously considered this issue specifically within the purview of the First Class Township Code. See Dodds, 84 -011. In Dodds, we concluded that a Commissioner in a Township of the First Class could not receive or secure for himself through his office, compensation, whether considered monthly payments, salary or the value of insurance premiums paid for by the township in excess of the compensation allowed and limited by law. Ms. Irene Pohl _Page 5 August 14, 1985 Additionally, the Code provides: §55603. Compensation. Elected officers of townships shall receive such salary, compensation or emoluments of office as may from time to time be fixed by ordinance of the township in accordance with provisions of section 703. Any change in salary, compensation or emoluments of office shall become effective at the beginning of the next term of the elected officer. Appointed officers and employes of the township shall receive such compensation for their services as the township commissioners shall prescribe. 53 P.S. 55603. While the Township Code contains a general power to contract for insurance 53 P.S. §56523, it also limits the "compensation" allowed for commissioners. See 53 P.S. 55703. This limitation, when read in conjunction with the mechanism prescribed in the Township Code (53 P.S. 55603) for increasing the "salary, compensation and emoluments of office" as may be fixed by ordinance, evidences the intent of the Legislature to limit and fix such payments. We must also note that pursuant to Section 55603 of the First Class Township Code the compensation of elected township officials, including the compensation paid to commissioners pursuant to Section 55703 must be fixed by township ordinance. In the instant situation, the inclusion of the township commissioners was effected by a resolution rather than by ordinance. Thus, even if such compensation, in the form of insurance coverage, were authorized the mechanism through which it was obtained may be defective. See Eme rt et. al. v. Hatfield Township et al., 74 Montg. Co. L.R. 249, (1957); Richland Township v. Breiner et ux., 8 Bucks Co. L. Rep. 107, (1958). Additionally, we must note that Section 55603 mandates that any change in compensation or emoluments of office "shall become effective at the beginning of the next term of the elected officer." Resolution 5 -78 granting group insurance benefits to the township commissioners was effective "as soon as possible." In this Commission's opinion in Dodds, while we did not pass upon the propriety of obtaining insurance coverage, at the expense of the township for officials as opposed to employees, we did note that the Township Code appears to limit such coverage only to employees. 53 P.S. §56523. See e.g. Domalakes, 85 -010. It should be noted that you have submitted a letter from a former legislative assistant indicating that the deletion of the term "as full compensation" from the last sentence of Section 55703 above, now allows the purchase of insurance coverage for Commissioners as a form of compensation. Ms. Irene Pohl Page 6 Even assuming this is a correct interpretation of the first class township code, there was no indication in that letter that the combined compensation, i.e., insurance coverage plus monetary salary could exceed the dollar limits as specifically set forth in Section 55703, in this case $1,200. Here as in Dodds, we believe it could not. Thus, even if such coverage was authorized for officials pursuant to the code, your receipt of such resulted in a salary in excess of the amount provided for by law, i.e. $1,200. You received $1,200 as a Commissioner in addition to the benefit of having the township pay for the insurance premium. These payments totaled $357.21 for the years 1984 -1985. Section 9. Penalties. (a) Any person who violates the provisions of Section 3(a) and (b) is guilty of a felony and shall be fined not more than $10,000 or imprisoned for not more than five years, or be both fined and imprisoned. 65 P.S. 409(a). (c) Any person who obtains financial gain from violating any provision of this act, in addition to any other penalty provided by law, shall pay into the State Treasury a sum of money equal to three times the financial gain resulting from such violation. 65 P.S. 409(c). August 14, 1985 Additionally, the Commission may make recommendation for prosecution by the appropriate prosecuting authority unless the person who is in violation of the Act returns any financial gain obtained in violation of the Act. See McCutcheon /Hoak v. State Ethics Commission, 77 Pa. Commw. 529, 466 A.2d 283, (1982). We believe that this result should be reached in the instant matter. C. Conclusion: You violated Section 3(a) of the State Ethics Act when you, as a township commissioner, received at the township expense, hospitalization and medical insurance in excess of that compensation provided by law. Our calculations indicate that the expense to the township for such insurance amounted to $357.21. Unless within thirty (30) days of this Order you forward to the State Ethics Commission a check in the above amount, made payable to Wilkins Township, we will refer this matter to the appropriate law enforcement officer for appropriate action. Upon the receipt of said check, we will take no further action in this matter. Our files in this case will remain confidential in accordance with Section 8(a) of the Ethics Act, 65 P.S. 408(a). However, this Order is final and will be made available as a public document 15 days after service (defined as mailing) unless you file documentation with the Commission which justifies reconsideration and /or challenges pertinent factual findings. See 51 Pa. Code Ms. Irene Pohl Page 7 2.38. During this 15 -day period, no one, including the Respondent unless he waives his right to challenge this Order, may violate this confidentiality by releasing, discussing or circulating this Order. Any person who violates the confidentiality of a Commission proceeding is guilty of a misdemeanor and shall be fined not more than $1,000 or imprisoned for not more than one year or both, see 65 P.S. 409(e). JJC /sfb the om, ssion erbe B. Conner Cha man August 14, 1985 EMS/rdp Ms. Irene J. Pohl 227 Harrison Road Turtle Creek, PA 15145 Dear Ms. Pohl: STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 September 10, 1985 I acknowledge receipt of your Check No. 263 in the amount of $357.21 payable to Wilkins Township. This check meets the requirements of Order No. 403 of the State Ethics Commission. For the record, I also want to note your statement in your cover letter that you accepted this insurance coverage from the township because you were informed it was not improper but that you have now told the township to cancel the coverage because of your desire to "serve [your] community in an honest and efficient manner ". Our files will be closed and Order No. 403 will be a public record as of the date of this letter. A copy of this letter will be made a part of that record. Sincerely yours, Edward M. Seladones Executive Director