Loading...
HomeMy WebLinkAbout00-002 KeenanNancy S. Keenan 601 East Walnut Street Perkasie, PA 18944 Dear Ms. Keenan: I. ISSUE: OPINION OF THE COMMISSION Before: Daneen E. Reese, Chair Austin M. Lee, Vice Chair Julius Uehlein Louis W. Fryman John J. Bolger Frank M. Brown Susan Mosites Bicket DATE DECIDED: 4/13/2000 DATE MAILED: 4/28/2000 00 -002 Re: Conflict; Public Official /Employee; Member; Borough; Council; Officer; Senior Center; Vote; Funding; Budget; Business With Which Associated; Non - Profit Corporation; Advice of Counsel; Appeal; Advice of Counsel. This Opinion is issued in response to the appeal of Advice of Counsel, 00 -514, which was issued on February 15, 2000. Whether the Public Official and Employee Ethics Act presents any prohibition or restrictions upon a borough council member, who is a member of a senior center that provides services in the borough, as to voting or participating in matters involving the annual budget which provides funding for the senior center or the granting of funds to construct a new senior center building. II. FACTUAL BASIS FOR DETERMINATION: By letter dated February 28, 2000, you appealed Advice of Counsel, 00 -514, issued on February 15, 2000. In your initial advisory request letter dated January 12, 2000, you presented the following facts. You are a Member of the Perkasie Borough Council, the Chair of the Bucks County Area Agency on Aging Advisory Board, a Member of the Southeast Regional Council of the Pennsylvania Council on Aging, and a Member of the Attorney General's Task Force on Crimes Against Older People. You previously have served on the Pennsylvania Council on Aging. Keenan, 00 -002 April 28, 2000 Page 2 You are also the Director and a Member of the Executive Committee of the Bucks County Association for Retired and Senior Citizens (BCARSC) which oversees the operations of five senior centers in Bucks County, including grant applications and compliance, and the administration of subcontracted state and federal services to area older residents and personnel. You are a Member of the Center, a Member of the Pennridge Senior Center Advisory Board (Advisory Board), and President of the Pennridge Senior Center Association, Inc. (Association). The Pennridge Senior Center (Center), which serves nine municipalities including Perkasie Borough, is one of the five senior centers subject to oversight by BCARSC. The Advisory Board and the Association support the Center by raising money to keep it operational. As a Member of the Center, you attend only one or two events a year in order to have a presence with the membership. All the organizations with which you are involved are non - profit organizations chartered under State and Federal Rules. Other than meals and mileage which are covered by the Pennsylvania State Boards, you pay for all of your other expenses, including your personal expenses and postage for your fund raising activities. You derive no financial gain from your involvement in such activities. You are playing a key part in raising money to build a new building to replace the inadequate facility which serves the nine municipality Pennridge service areas. As a private citizen, you attended municipal meetings at all nine municipalities served by the Center, including Perkasie, to request building fund pledges covering a three -year period. Advice of Counsel, 00 -514, which was issued on February 15, 2000, noted that your request was problematic because information was not provided as to the relationship between the Center, Advisory Board, and Association. The Advice stated that because the submitted facts did not specify whether the foregoing bodies were the same or separate entities, you were only given general advice as to the applicability of Sections 1103(a) and 1103(j) of the Ethics Act. The Advice concluded that if the Center, Advisory Board or Association would be a "business with which - -- associated" as that phrase is defined in the Ethics Act, pursuant to Section 1103(a), you would be prohibited from using the authority of your office as a Member of Borough Council or any confidential information for the private pecuniary benefit of such "business." The Advice stated, You state that you are merely a member of the Center and the Advisory Board. Based upon your express factual representation that the Center or the Advisory Board is a separate entity from the Association, and is not a business in which you are a director, officer, owner, employee or have a financial interest, neither of the foregoing entities would be a business with which you are associated." Keenan, at 4. As to the Association of which you are President, the Advice concluded that it is a "business" with which you are associated because as a corporation, the Association is clearly within that definition. The Advice cited Commission precedent that the Association would be considered a "business" under the Ethics Act even though it is a non - profit corporation. After noting that one of the ways in which the Association raises money to cover the operational costs of the Center is by seeking funds from the Borough, the Advice concluded that such funding would be a financial benefit to the Association and you would have a conflict of interest in matters of the Association that would come before Borough Council. Finally, Advice of Counsel, 00 -514, concluded that Section 1103(a) of the Ethics Act would prohibit you from participating as to funding and voting on granting building funds as Keenan, 00 -002 April 28, 2000 Page 3 well as the annual budget to the extent that your activities would result in a financial benefit to a business with which you are associated. In your appeal of Advice dated February 28, 2000, you object to the conclusion that the Pennridge Senior Center Association is a "business" with which you are associated. You state that the Association was created as a depository of money raised from raffles, bake sales, car washes, or any other community fund - raising events on behalf of the Pennridge Senior Center building fund. You maintain that the Association does not sell, manufacture or deliver a product or service. You state that the Association, which is a §403(c)(2) corporation consisting of three officers, has no expenses since all labor, postage, and the like are donated by those officers. You maintain that you donate time and money to the Association, but do not derive a financial gain from your efforts. Finally, you state that since your original letter of January 12, 2000, you have canceled your membership in the Pennridge Senior Center. By letter dated March 11, 2000, you provided the following additional facts. The Pennridge Senior Center Association does not and will not receive any funds that Perkasie Borough dedicates to the Pennridge Senior Center. Any such funds would be deposited directly into the Pennridge Senior Center account to which the Pennridge Senior Center Association would have no access. Further, the Pennridge Senior Center Association and the Pennridge Senior Center are separate legal entities; neither body appoints members to the other body's board. By letter dated March 27, 2000, you were notified of the date, time, and location of the public meeting at which your appeal was to be considered. III. DISCUSSION: Our review of this matter is de novo. We shall initially set forth the pertinent provisions of the Ethics Act which are to be applied in this matter. Section 1103(a) of the Ethics Act provides: Section 1103. Restricted activities. (a) Conflict of interest. - -No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa. C. S. §1103(a). The following terms are defined in the Ethics Act as follows: Section 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 Keenan, 00 -002 April 28, 2000 Page 4 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. Section 1103(j) of the Ethics Act provides as follows: Section 1103. Restricted activities. (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 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(j). In applying the above provisions of the Ethics Act to the facts which you have submitted, we find that each conclusion reached in the Advice of Counsel is based upon established precedent and a straightforward application of the pertinent provisions of the Ethics Act. As a Council Member for Perkasie Borough, you are a public official subject to the provisions of that Act. Keenan, 00 -002 April 28, 2000 Page 5 As to whether the Pennridge Senior Center, Pennridge Senior Center Advisory Board, and the Pennridge Senior Center Association, Inc. are the same or several entities, you have factually clarified that the Pennridge Senior Center Association and the Pennridge Senior Center are separate legal entities. However, you still have not provided facts as to whether the Pennridge Senior Center Advisory Board is legally related to the Pennridge Senior Center. Given the above, ambiguity still exists as to your submission. Accordingly, just as in the case of Advice, we must condition our response relative to your relationship with these entities. If the Center is a separate entity from the Advisory Board and if by canceling your membership with the Center, you have severed any relationship to it so that it is not a business with which you are associated, you would not have a conflict as to matters involving the Center. We conclude that if the Pennridge Senior Center Advisory Board would be a business with which you are associated as that phrase is defined in the Ethics Act, pursuant to Section 1103(a), you would have a conflict as to financial matters involving that entity. We affirm the conclusion that the Pennridge Senior Center Association, Inc. is a "business" as that term is defined in the Ethics Act. The Association is a corporation. The statutory definition of "business" specifically includes corporations. As for your argument that the Association is merely a depository for money raised from raffles, bake sales, carwashes, and the like, and not a business that sells, manufactures or delivers a product or service, we find that the Advice correctly followed the Ethics Act and the prior precedent of this Commission that a non - profit corporation, is nonetheless a "business." See, Sparano, Order 1045. Finally, given the fact that the Pennridge Senior Center Association, Inc. is a "business," we affirm the conclusion that it is a "business "with which - -- associated" because you are its president. Section 1103(a) mandates the conclusion that in your capacity as Council Member for Perkasie Borough, you would have a conflict of interest as to financial matters involving the Association. We are aware that you have now stated that the Pennridge Senior Center Association will not receive any funds that Perkasie Borough dedicates to the Pennridge Senior Center. This will moot any conflict in this instance because the Association will not receive any Borough funds vis -a -vis the Pennridge Senior Center. However, the possibility exists that at some time, the Association may have some matter before the Borough Council and in that event, a conflict would exist. Clearly, if such a circumstance would arise, you would have to abstain and satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. It is clear to us that you are not using public office for financial gain and are giving of your time and effort for a very worthwhile goal of helping senior citizens. It is also clear that the Ethics Act, which is a law of the Commonwealth of Pennsylvania, prescribes that certain situations arise to the level of a conflict of interest and in such cases, the public official /employee must abstain. In such instances, what the Ethics Act directs and what this Opinion concludes is that you must not participate where a business with which you are associated has financial matters before your governmental body. Advice of Counsel, 00 -514, is affirmed. 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. IV. CONCLUSION: Keenan, 00 -002 April 28, 2000 Page 6 A borough council member is a public official subject to the provisions of that Act. If an entity would be a business with which she is associated as that phrase is defined in the Ethics Act, pursuant to Section 1103(a), the council member would have a conflict and could not participate as to financial matters involving such a business. If the senior center or a senior center advisory board is a separate entity from a senior center association, and is not a business in which the council member is a director, officer, owner, employee or has a financial interest, neither of the foregoing entities would be a business with which the council member is associated. The senior center association, of which council member is president, is a business with which she is associated. The council member would have a conflict in financial matters involving the senior center association that would come before council. In each instance of a conflict, the council member would be required to abstain and satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. Advice of Counsel, 00 -514, is affirmed. Pursuant to Section 1107(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. This letter is a public record and will be made available as such. Finally, any person may request this Commission to reconsider its Opinion. The reconsideration request must be received at this Commission within thirty 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, Daneen E. Reese Chair