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HomeMy WebLinkAbout02-552 SaxtonDaniel E. Saxton 1003 Edison Avenue Sunbury, PA 17801 Re: Public Official; Simultaneous Service; Third Class City; Controller; Fire Chief; Treasurer, Sunbury Volunteer Fire Department; Business With Which Associated; Treasurer, Sunbury Volunteer Firemen's Relief Association. Dear Mr. Saxton: ADVICE OF COUNSEL April 19, 2002 02 -552 This responds to your letter of March 13, 2002, by which you requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq., imposes any prohibition or restrictions upon an individual who serves as a city controller and fire chief for the city's volunteer fire department with regard to simultaneously serving or being employed as the treasurer of the fire department and the treasurer of a volunteer firemen's relief association. Facts: As Controller for the City of Sunbury ( "City "), a third class city, and as the Fire hief of the Sunbury Volunteer Fire Department ( "Fire Department "), you seek an advisory from the State Ethics Commission. You have submitted facts which may be fairly summarized as follows. By letter dated November 13, 2001, you previously submitted a request for an advisory regarding the propriety of your simultaneous service as the City Controller and as Fire Chief for the Fire Department. In response to your inquiry, Saxton, Advice of Counsel, 01 -612 was issued. Saxton, Advice of Counsel, 01 -612 determined that there did not appear to be any statutorily - declared incompatibility or inherent conflict precluding your simultaneous service as the City Controller and as Fire Chief of the Fire Department. Consequently, you were advised that such simultaneous service would be permitted within the parameters of Sections 1103(a) and 1103(j) of the Ethics Act (pertaining to conflicts of interest). In your most recent inquiry dated March 13, 2002, you state that new concerns have been raised regarding two additional positions in which you serve, specifically, the positions of Treasurer of the Fire Department and Treasurer of the Sunbury Volunteer Firemen's Relief Association ( "Relief Association "). You state that although you have served in both of these offices since 1990, you did not mention them in your prior advisory request because those positions were not being questioned at that time. Saxton, 02 -552 April 19, 2002 Page 2 You state that the Fire Department and the Relief Association are separate entities. In your dual capacities as Treasurer for the Fire Department and the Relief Association, you are not responsible for approving the payment of bills, but you are one of the required signatories for checks and you are responsible for maintaining the financial records of both the Fire Department and the Relief Association. The records that you maintain for the Relief Association are audited semi - annually by the State Auditor General's Office, because the Relief Association receives public funds. You receive no compensation as Treasurer of the Fire Department; you receive a $1,500 annual stipend as Treasurer of the Relief Association. Based upon the above, you seek an advisory as to the specific issue of whether you may simultaneously serve as City Controller, Fire Chief, Treasurer of the Fire Department, and Treasurer of the Relief Association. You have submitted the following additional facts that appear to be unrelated to your specific inquiry: Since I am a representative of a company with which the Fire Department and Relief Association does [sic] business (related party transactions) I abstain from voting on all matters with which I am affiliated. Full disclosure is made concerning my relationship with said company. (Saxton letter of March 13, 2002, at 1). Discussion: Before addressing your specific inquiry, two points must initially be noted. First, 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. In the instant matter, the submitted facts pertaining to your unidentified affiliation with an unidentified business are insufficient to form the basis for any analysis within this Advice and are not addressed herein. It is further initially noted that, pursuant to Sections 1107(10) and (11) of the Ethics Act, 65 Pa.C.S. §1107(10), (11), an opinion /advice may be given only as to prospective (future) conduct. If the activity in question has already occurred, the Commission may not issue an opinion /advice, but any person may then submit a signed and sworn complaint which will be investigated by the Commission if there are allegations of Ethics Act violations by a person who is subject to the Ethics Act. To the extent you have inquired as to conduct which has already occurred, such past conduct may not be addressed in the context of an advisory opinion. However, to the extent you have inquired as to future conduct, your inquiry may and shall be addressed. In your capacities as City Controller and as Fire Chief of the Fire Department, you are a public official /public employee subject to the provisions of the Ethics Act. 65 Pa.C.S. § 1102; 51 Pa. Code § 11.1; See, Apfelbaum, Advice 92 -531 (concluding that the Fire Chief of the Sunbury Fire Department would be considered a public employee subject to the Ethics Act). In your capacity as the Treasurer of the Fire Department, it is not clear from the submitted facts whether you are a public official subject to the Ethics Act. Your status in that particular capacity hinges upon the status of the Fire Department, which cannot be Saxton, 02 -552 April 19, 2002 Page 3 determined from the submitted facts. 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 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 pertaining to conflicts of interest under the Ethics Act are defined 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 Saxton, 02 -552 April 19, 2002 Page 4 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. The terms "governmental body" and "political subdivision" are defined in the Ethics Act as follows: §1102. Definitions "Governmental body." Any department, authority, commission, committee, council, board, bureau, division, service, office, officer, administration, legislative body or other establishment in the executive, legislative or judicial branch of a state, a nation or a political subdivision thereof or any agency performing a governmental function. "Political subdivision." Any county, city, borough, incorporated town, township, school district, vocational school, county instutution district, and any authority, entity or body organized by the aforementioned. 65 Pa.C.S. § 1102. It is administratively noted that pursuant to the Third Class City Code, the City Controller is an elected City official. 53 P.S. § 35701. The powers and duties of the City Controller include, inter alia, countersigning all warrants for lawful payments by the City (53 P.S. § 36706) and examining, auditing, and settling accounts as follows: § 36704. Examination and audit of accounts (a) The city controller shall examine, audit and settle all accounts whatsoever in which the city is concerned, either as debtor or creditor, and shall also, annually or as often as he desires or is directed to do so by council, examine and audit the accounts of all bureaus, officers, and departments which collect, receive, and disburse public moneys, or who are charged with the management, control, or custody thereof, and in every case he shall make report of such examination, audit and settlement to the council. He shall likewise audit and report upon the accounts of any such officer upon the death, resignation, removal or expiration of the term of the said officers. He shall likewise audit and report upon the accounts of any library to which the city makes appropriations, those of any institution owned by the city, and those of National Guard units to which the city makes appropriations. Saxton, 02 -552 April 19, 2002 Page 5 (b) He shall likewise audit, or with the consent of council cause to be made by an accountant an annual audit of, all the accounts of any municipal officer in any department of the city government who may be charged with the duty, or who may perform the services, of receiving and disbursing the funds of any association, society, or organization of municipal employes or persons, directly or indirectly connected with the municipal government, for the benefit, relief, or pensioning of firemen, policemen, or other municipal employes or persons as aforesaid. (c) All such audits shall be made within as short a time as possible after the close of the fiscal year, and be annually reported to council at its first meeting in March, as other reports of the controller are made, and shall be filed with the court of quarter sessions within ninety days of the close of the fiscal year. (d) Council may provide for an audit of any or all accounts by an independent certified public accountant. (e) Brief abstracts or summaries of the reports of such accounts and financial statements or such other reports thereof as council may require shall be published at least once a week for two weeks in one newspaper, in accordance with the provisions of section one hundred and nine of this act. The expense and cost of such publication shall be paid out of the funds of the various associations, organizations, or societies, as their other expenses are paid. 53 P.S. § 36704. In applying the provisions of the Ethics Act to the question of simultaneous service, the General Assembly has the constitutional power to declare by law which offices are incompatible. Pa. Const. Art. 6, § 2. There does not appear to be any statutorily - declared incompatibility precluding your simultaneous service as City Controller, Fire Chief of the Fire Department, Treasurer of the Fire Department, and Treasurer of the Relief Association. Turning to the question of conflict of interest, 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, a member of his immediate family, or a business with which he or a member of his immediate family is associated. Where simultaneous service would place the public official /public employee in a continual state of conflict, such as where in one position he would be accounting to himself in another position on a continual basis, there would be an inherent conflict (See, Johnson, Opinion 86 -004). Where an inherent conflict would exist, it would appear to be impossible, as a practical matter, for the public official /public employee to function in the conflicting positions without running afoul of Section 1103(a). Absent a statutorily - declared incompatibility or an inherent conflict under Section 1103(a), the Ethics Act would not preclude an individual from simultaneously serving in more than one position, but in each instance of a conflict of interest, the individual would Saxton, 02 -552 April 19, 2002 Page 6 be required to abstain and to satisfy the disclosure requirements of Section 1103(j) as set forth above. In this instance, based upon the facts which have been submitted, there does not appear to be an inherent conflict that would preclude your simultaneous service as City Controller, Fire Chief of the Fire Department, Treasurer of the Fire Department, and Treasurer of the Relief Association. Consequently, such simultaneous service would be permitted within the parameters of Sections 1103(a) and 1103(j). In considering the parameters of Sections 1103(a) and 1103(j), it is clear that in your capacity as City Controller, you would have a conflict of interest pursuant to Section 1103(a) of the Ethics Act with regard to examining, auditing or settling any accounts of the Fire Department or Relief Association. Clearly, it would be a conflict of interest for you to examine or audit as City Controller the very financial records that you prepare and accounts that you maintain as Treasurer of the Fire Department or as Treasurer of the Relief Association. Additionally, based upon the facts which you have submitted, the Relief Association is separate from the City and is a business with which you, as Treasurer, are associated. Pursuant to Section 1103(a) of the Ethics Act, you would have a conflict of interest in any of your public capacities in matter(s) that would financially impact the Relief Association. As for the Fire Department, since the submitted facts are insufficient to determine whether the Fire Department is a governmental body or a business for purposes of applying the Ethics Act, this Advice must necessarily be limited to providing the following general guidance in that regard. If the Fire Department would be considered a governmental body, then in your capacity as Treasurer of the Fire Department, you would be a public official subject to the provisions of the Ethics Act. 65 Pa.C.S. § 1102; 51 Pa. Code § 11.1. Under that scenario, you would not have a conflict of interest in using the authority of a public position for the pecuniary benefit of the Fire Department as a governmental body. Warso, Order 974. However, if the Fire Department would be considered a business, it would be a business with which you are associated as an officer. Under that scenario, you would have a conflict of interest in using the authority of a public position for the pecuniary benefit of the Fire Department as a business with which you are associated. In each instance of a conflict, you would be required to abstain fully and to satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. Where a conflict would exist under the Ethics Act, the situation could prove further problematic to the extent any person acting in your stead as to your public powers or duties would be your subordinate in the Controller's Office or Fire Department. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Conclusion: In your capacities as Controller for the City of Sunbury ( "City ") and as Fire Chief for the Sunbury Volunteer Fire Department ( "Fire Department "), you are a public official /public employee subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq. In your capacity as the Treasurer of the Fire Department, it is not clear from the submitted facts whether you are a public official subject to the Ethics Act. You may simultaneously serve in the positions of City Controller, Fire Chief of the Fire Department, Treasurer of the Fire Department, and Treasurer of the Sunbury Volunteer Firemen's Relief Association ( "Relief Association ") within the parameters of Sections 1103(a) and 1103(j) of the Ethics Act and subject to the Saxton, 02 -552 April 19, 2002 Page 7 restrictions, conditions and qualifications set forth herein. In each instance of a conflict, you would be required to abstain fully and to satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. Where a conflict would exist under the Ethics Act, the situation could prove further problematic to the extent any person acting in your stead as to your public powers or duties would be your subordinate in the Controller's Office or Fire Department. Lastly, the propriety of the proposed course of conduct has only been addressed under the Ethics Act. Pursuant to Section 1107(11), this 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 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