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HomeMy WebLinkAbout01-529 BarbinWilliam Gleason Barbin, Esquire Gleason, DiFrancesco, Shahade, Barbin, McQuillan & Markovitz 206 Main Street Johnstown, PA 15901 -1682 Dear Mr. Barbin: ADVICE OF COUNSEL March 20, 2001 01 -529 Re: Conflict; Public Official /Employee; Township; Supervisor; Contract; Bid; Immediate Family Member; Son -In -Law; Business With Which Associated. This responds to your letter of February 14, 2001, by which you requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa. .S. §1101 et seq., presents any prohibition or restrictions upon township supervisors as to participating in and voting upon contracts where: 1) one bid was submitted by a supervisor's son -in -law; and 2) one bid was submitted by a company owned by another supervisor. Facts: As Solicitor for the Barr Township Supervisors, you seek an advisory regarding bids for contracted services. Prior to the Supervisors' public meeting on February 12, 2001, an advertisement was placed in a local newspaper requesting bids for the use of equipment and an operator and setting forth the minimum insurance requirements. You indicate that you have enclosed a copy of the advertisement for bids. However, no such copy has been submitted with your request. At the public meeting on February 12, 2001, bids for contracted services for the year were opened. Only two bids were received at the meeting. The first and only bid for backhoe work was received from Gary Kline, a son -in -law of one of the Supervisors. The second bid was received from a company owned by another Supervisor, Bernard Birchall. Supervisor Birchall's company submitted a bid to provide a skid steer loader, excavator and bulldozer. No other bids were received. You state your understanding that neither Supervisor may vote directly on an award of a contract to himself or to a son -in -law. You further state, "A question was Barbin, 01 -529 March 20, 2001 Page 2 raised by the third (of three) Supervisor[s] as to the legality." In the past, as Solicitor, you have opined that where there are open public bids, a supervisor may perform work under contract to the Township. You indicate that the award of contracts has been tabled pending an opinion from the State Ethics Commission. 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 requestor based upon the facts which the requestor has submitted. In issuing the advisory based upon the facts which the requestor has submitted, the 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 Pa.C.S. §1107(10), (11). An advisory only affords a defense to the extent the requestor has truthfully disclosed all of the material facts. The Supervisors of Barr Township are public officials as that term is defined in the Ethics Act, and hence they are subject to the provisions of that Act. Section 1103(a) of the Ethics Act provides: $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: $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. "Immediate family." A parent, spouse, child, brother or sister. "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. Barbin, 01 -529 March 20, 2001 Page 3 "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. "Contract." An agreement or arrangement for the acquisition, use or disposal by the Commonwealth or a political subdivision of consulting or other services or of supplies, materials, equipment, land or other personal or real property. The term shall not mean an agreement or arrangement between the State or political subdivision as one party and a public official or public employee as the other party, concerning his expense, reimbursement, salary, wage, retirement or other benefit, tenure or other matters in consideration of his current public employment with the Commonwealth or a political subdivision. 65 Pa.C.S. §1102. In addition, Sections 1103(b) and 1103(c) of the Ethics Act 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 judgment 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 1103(f) of the Ethics Act provides as follows: $1103. Restricted activities. (f) Contract. - -No public official or public employee or his spouse or child or any business in which the person or his spouse or child is associated shall enter into any contract valued at $500 or more with the governmental body with which the public official or public employee is associated or any subcontract valued at $500 or more with any person who has been awarded a contract with the governmental body with which the public official or public employee is associated, unless the contract has been awarded through an open and public process, including prior public notice and subsequent public disclosure of all proposals considered and contracts awarded. In such a case, the public official or public employee shall not have any supervisory or overall responsibility for the implementation or administration of the contract. Any contract or subcontract made in violation of this subsection shall be voidable by a court of competent jurisdiction if the suit is commenced within 90 days of the making of the contract or subcontract. 65 Pa.C.S. §1103(f). Section 1103(f) does not operate to make contracting with the governmental body permissible where it is otherwise prohibited. Rather, where a public official /public employee, his spouse or child, or a business with which he, his spouse or child is associated, is otherwise appropriately contracting with the governmental body, or subcontracting with any person who has been awarded a contract with the governmental Barbin, 01 -529 March 20, 2001 Page 4 body, in an amount of $500.00 or more, Section 1103(f) requires that an "open and public process" be observed as to the contract with the governmental body. Pursuant to Section 1103(f), an "open and public process" includes: (1) prior public notice of the employment or contracting possibility; (2) sufficient time for a reasonable and prudent competitor /applicant to be able to prepare and present an application or proposal; (3) public disclosure of all applications or proposals considered; and (4) public disclosure of the contract awarded and offered and accepted. Section 1103(f) of the Ethics Act also requires that the public official /employee may not have any supervisory or overall responsibility as to the implementation or administration of the contract with the governmental body. Section 1103(j) of the Ethics Act provides as follows: $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 each instance of a conflict, Section 1103(j) requires the public official /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 or supervisor. In the event that the required abstention results in the inability of the governmental body to take action because a majority is unattainable due to the abstention(s) from conflict under the Ethics Act, then voting is permissible provided the disclosure requirements noted above are followed. See, Mlakar, Advice 91- 523 -S. Barbin, 01 -529 March 20, 2001 Page 5 In applying the above provisions of the Ethics Act to the instant matter, pursuant to Section 1103(a) of the Ethics Act, 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. With regard to the Supervisor whose son -in -law submitted a bid for backhoe work, you are advised that the term "immediate family" is defined to include a parent, spouse, child, brother, or sister. Since a son -in -law is not in one of the familial relationships delineated above, Section 1103(a) of the Ethics Act would not prohibit the Supervisor from participating in and voting on the contract for backhoe work to his son -in -law. See, Pulice v. State Ethics Comm'n, 713 A.2d 161 (Pa. Commw. 1998), appeal dismissed, 557 Pa. 642, 732 A.2d 1211 (1998). With regard to the Supervisor whose company submitted a bid to provide a skid steer loader, excavator and bulldozer, Section 1103(a) of the Ethics Act would prohibit that Supervisor from using the authority of his public position, or confidential information to solicit or promote business activity between his company, a business with which he is associated, and Barr Township. Furthermore, the Supervisor would have a conflict as to any involvement in reviewing or selecting bids or proposals. In each instance of a conflict, the Supervisor would be required to abstain and observe the disclosure requirements of Section 1103(j) of the Ethics Act as set forth above. Given that there are three Supervisors in Barr Township, the Supervisor with the conflict would be permitted to vote despite that conflict under very precise and limited circumstances. Section 1103(j) of the Ethics Act would allow that Supervisor to vote to break a tie vote (deadlock) between the other two Supervisors conditioned upon the assumption that he /she would otherwise abstain from any involvement in the matter and would satisfy the disclosure requirements. Additionally, the State Ethics Commission has held that in the situation where a member of a three - member board has a conflict and one of the other members refuses to second a motion to bring it to a vote or is absent, the member with the conflict may second the motion. Garner, Opinion 93 -004. However, the Commission has not taken any further step to allow a supervisor with a conflict to vote despite his conflict where another member of the board is absent and there is no actual deadlock. Absent such a ruling by the Commission, this Advice must necessarily conclude that the mere absence of the other Supervisor would not enable the Supervisor with the conflict to circumvent the express requirements of the voting conflict exception in Section 1103(j), which by its own terms requires that there be a deadlock between the remaining two Supervisors before the Supervisor with the conflict may vote. Parenthetically, although the contracting in question would not be prohibited under the Ethics Act provided the requirements of Sections 1103(a), 1103(f), and 1103(j) are satisfied, a problem may exist as to such contracting under the respective code. In the instant situation, the Second Class Township Code provides as follows: $68102. Letting contracts (i) No township official, either elected or appointed, or township employee who knows, or who by the exercise of reasonable diligence could know, shall be interested to any appreciable degree, either directly or indirectly, in any contract for the sale or furnishing of any supplies or materials for the use of the township or for any work to be done for the township involving the payment by the township of more than five hundred dollars ($500) in any year unless the contract is awarded through the public bid process. This limitation does not apply if the officer or Barbin, 01 -529 March 20, 2001 Page 6 appointee of the township is an employe of the person, firm or corporation to which the money is to be paid in a capacity with no possible influence on the transaction and the officer cannot possibly be benefited thereby, either financially or otherwise. If a supervisor is within this exception, the supervisor shall so inform the board of supervisors and refrain from voting on the payments and shall in no manner participate in the contract. Any official or appointee who knowingly violates this provision is subject to surcharge to the extent of the damage shown to be sustained by the township, is ousted from office or employment and commits a misdemeanor of the third degree. Since such contracting may be prohibited by the above quoted provision, it is suggested that you seek legal advice in that regard. 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 respective municipal code. Conclusion: The Supervisors of Barr Township are public officials subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. §1101 et seq. A son -in -law is not considered an immediate family member under the Ethics Act. Therefore, Section 1103(a) of the Ethics Act would not prohibit the Supervisor whose son -in -law submitted a bid for backhoe work from participating in and voting on the contract for backhoe work. The Supervisor whose company submitted a bid to provide a skid steer loader, excavator and bulldozer would be prohibited by Section 1103(a) from using the authority of his public position or confidential information to solicit or promote business activity between his company, a business with which he is associated, and Barr Township. Furthermore, the Supervisor would have a conflict as to any involvement in reviewing or selecting bids or proposals. In each instance of a conflict, the Supervisor would be required to abstain and observe the disclosure requirements of Section 1103(j) of the Ethics Act as set forth above. Section 1103(j) of the Ethics Act would allow the Supervisor with the conflict to vote to break a tie vote (deadlock) between the other two Supervisors conditioned upon the assumption that he /she would otherwise abstain from any involvement in the matter and would satisfy the disclosure requirements. Additionally, where one of the other Supervisors would refuse to second a motion to bring it to a vote or would be absent, the Supervisor with the conflict would be permitted to second the motion. The restrictions of Section 1103(f) of the Ethics Act as set forth above must be observed as to any contract between the Supervisor's company and Barr Township. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Pursuant to Section 1107(11), 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 requestor 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 Barbin, 01 -529 March 20, 2001 Page 7 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, Vincent J. Dopko Chief Counsel