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HomeMy WebLinkAbout02-562 BellesN. Brian Caverly, Esquire Wetzel, Caverly, Phillips & Rodgers 15 Public Square, Suite 210 Wilkes- Barre, PA 18701 Re: Conflict; Public Official /Employee; Township; Tax Collector; Immediate Family Member; Appointing Spouse As Deputy Tax Collector. Dear Mr. Caverly: ADVICE OF COUNSEL May 24, 2002 02 -562 This responds to your letter of April 22, 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., presents any prohibition or restrictions upon a township tax collector as to appointing his spouse as deputy tax collector where any compensation the spouse would receive would be a part of and not in addition to the tax collector's compensation. Facts: You represent Edward Belles ( "Belles ") and his spouse. As the duly erected Tax Collector in Union Township, Luzerne County, Pennsylvania, Belles wishes to appoint his spouse to the position of Deputy Tax Collector pursuant to the provisions of Section 5511.22 of the Local Tax Collection Law, 72 P.S. § 5511.1 et seq. You have submitted copies of Sections 5511.22, 5511.23 and 5511.24 of the Local 1 ax Collection Law, which are incorporated herein by reference. You state that if the appointment would be approved, any compensation Belles' spouse would receive would be part of and not in addition to that which Belles would receive as Tax Collector. You further state that neither the municipality nor the taxpayers would be responsible for paying the Deputy Tax Collector's salary. You believe that any possible violation of the Ethics Act would relate to Section 1103(f) the contracting provision. However, you opine that Section 1103(f) of the Ethics Act would not apply under the facts of this case. 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 Caverly /Belles 02 -562 May 24, 2002 Page 2 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. As Tax Collector for Union Township, Edward Belles ( "Belles" ) is a public official as that term is defined in the Ethics Act, and hence Belles is 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. "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 Caverly /Belles 02 -562 May 24, 2002 Page 3 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 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. Caverly /Belles 02 -562 May 24, 2002 Page 4 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. 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. Belles' spouse is a member of his immediate family. Pursuant to Section 1103(a ) of the Ethics Act, as Tax Collector, Belles would have a conflict as to matters that would result in a financial gain to himself or his spouse. As to the question you pose, it appears that this is not a situation where Belles' spouse, as Deputy Tax Collector, would serve as a volunteer without receiving a salary or compensation. In that Belles' spouse apparently would be paid some of the Caverly /Belles 02 -562 May 24, 2002 Page 5 compensation that he would otherwise receive, Section 1103(a) of the Ethics Act would prohibit Belles from appointing his spouse to the position of Deputy Tax Collector because Belles would be using the authority of his office as Tax Collector for a private pecuniary benefit of an immediate family member and himself. Belles would receive a private pecuniary benefit by directing the out -of- pocket expenses to an immediate family member rather than paying compensation to a third party as Deputy Tax Collector. In this regard, the Commission has held that the reduction /elimination of out -of- pocket payments is a private pecuniary benefit. See, Johnston, Order 1200. The above conforms with prior Commission precedent that a public official can not use the authority of office for a private pecuniary benefit of an immediate family member. See, Confidential Opinion, 02 -004 (wherein the Commission held that pursuant to Section 1103(a) of the Ethics Act, a public official would be prohibited from approving the appointment of a member of his immediate family to a compensated position with the political subdivision). See also, Holvey, Order 1039 (wherein the Commission held, inter alia, that a directora county "vo- tech" school violated Section 3(a) of the Ethics Law when he hired his spouse to teach adult courses at the vo -tech. The Order was appealed to the Commonwealth Court of Pennsylvania, which affirmed the Commission's Order with regard to the Section 3(a) violation, but reversed the Order with regard to the imposition of treble damages and remanded the case to the Commission for the imposition of the appropriate penalty. Holvey v. State Ethics Commission, No 815 C.D. 1997 (Pa. Commw. 1997). As to the Commission's holding on remand, See, 1998 Decisions, Order 1039 -2. Holvey subsequently appealed ealed Order No. 1039 -2 to the Commonwealth Court of Pennsylvania which affirmed order.); and Corridoni, Advice of Counsel, 01 -542 (wherein it was determined that Section 1103(a) of the Ethics Act would prohibit a county coroner from hiring his spouse as his secretary /administrative assistant because there would be a use of authority of office by the county coroner for a private pecuniary benefit of an immediate family member). Finally, in that the compensation Belles' spouse would receive would probably be $500 or more given that she would be Deputy Tax Collector, the restrictions of Section 1103(f) as set forth above would apply. Under Section 1103(f), Belles could not have any supervisory or overall responsibility as to the implementation or administration of his spouse's contract. Further, as a practical matter, it would appear to be extremely difficult for Belles not to have any supervisory or overall responsibility as to the implementation or administration of his spouse's contract and still perform his functions as Tax Collector. See, Confidential Opinion, supra. 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 Local Tax Collection Law. Conclusion: As Tax Collector for Union Township, Edward Belles ( "Belles ") is a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq. Belles' spouse is a member of his immediate family. Pursuant to Section 1103(1) of the Ethics Act, as Tax Collector, Belles would have a conflict as to matters that would result in a financial gain to himself or his spouse. Where it would appear that as Deputy Tax Collector, Belles' spouse would receive some of the compensation that Belles would otherwise receive, Section 1103(a) of the Ethics Act would prohibit Belles from appointing his spouse to the osition of Deputy Tax Collector because Belles would be using the authority of his office as Tax Collector for a private pecuniary benefit of an immediate family member and himself. Belles would receive a private pecuniary benefit by directing the out -of- pocket expenses Caverly /Belles 02 -562 May 24, 2002 Page 6 to an immediate family member rather than paying compensation to a third party as Deputy Tax Collector. In that the compensation Belles' spouse would receive would probably be $500 or more given that she would be Deputy Tax Collector, the restrictions of Section 1103(f) as set forth above would apply. Under Section 1103(f), Belles could not have any supervisory or overall responsibility as to the implementation or administration of his spouse's contract. Further, as a practical matter, it would appear to be extremely difficult for Belles not to have any supervisory or overall responsibility as to the implementation or administration of his spouse's contract and still perform his functions as Tax Collector. 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 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