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HomeMy WebLinkAbout96-504 RuoffPaula D. Munson, Esquire Nikolaus, Hohenadel & Umbenhauer 212 North Queen Street Lancaster, PA 17603 Dear Ms. This requested Issue: presents President following Munson: STATE ETHICS COMMISSION 309 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 1 71 08 -1 470 TELEPHONE (717) 783.1610 ADVICE OF COUNSEL January 30, 1996 96 -504 Re: Former Public Official; Section 3(g); Lancaster City Council; Lancaster County Housing Development Corporation. responds to your letter of December 13, 1995 in which you advice from the State Ethics Commission. Whether the Public Official and Employee Ethics Law any restrictions upon a former City Councilmember as of the Lancaster County Housing Development Corporation termination of service with the City Council. Facts: Your office represents the Housing Development Corporation of Lancaster County (HDC) which is a non- profit Pennsylvania corporation engaged in developing and operating affordable housing projects in the Central Pennsylvania area. The HDC, which was formed in 1971, has participated in the development of over 2,000 units of residential rental housing for low and moderate income households including housing for elderly and handicapped persons. HDC's wholly owned subsidiary, HDC Investments, Inc., a Pennsylvania business corporation, acts as general partner in 27 limited partnerships owning and operating such properties. HDC is also the management agent for these properties as well as other affordable housing properties owned by other unrelated entities. HDC utilizes various federal and state programs in development of the projects. You are writing on behalf of Edmund R. Ruoff (Ruoff) who was elected to the Lancaster City Council in November, 1993. Ruoff has been associated with HDC since 1971 and has served as its President for 19 years. Ruoff is also the Vice President of HDC Investments. Ruoff's dual role as City Councilman and President of HDC became an Munson /Ruoff, 96 -504 January 30, 1996 Page 2 obstacle to HDC's goals to provide affordable housing in the City of Lancaster which resulted in his decision to resign from City Council effective October 10, 1995. Your specific inquiry relates to HDC's ability to develop projects intended to receive funds or other benefits from the City of Lancaster in light of Ruoff's resignation from Council. After referencing the Ethics Law and the one -year representational restriction as to Ruoff, you assert that the corporation and its affiliates would not be so precluded provided Ruoff is not involved in any way. After stating that HDC has three current projects for which it would like to obtain City funding and additional projects which may be developed, HDC proposes to proceed subject to the following conditions: Ruoff will not participate, attend meetings, or communicate with the City or its representatives; Ruoff's name will not appear on any applications, documents or HDC letterhead; Ruoff will not attend meetings as to the projects; Ruoff will have no involvement in carrying out the activities as to which City funds are received; and all activities for such projects will be conducted by other HDC personnel with Ruoff being apprised of the status of the projects. Regarding the need to obtain a HUD waiver as to Ruoff, you note that obtaining the waiver will require discussion between HDC personnel /attorneys and City personnel /Solicitor. Such discussions will include the mention of Ruoff's name and position with HDC. Since such waiver application requires public disclosure of the potential conflict and an opinion of the City Solicitor, you state that such procedures appear to require actions inconsistent with the Ethics Law. You conclude by asking the following questions: whether HDC participation in city programs contravenes the Ethics Law given Ruoff's previous position on Council; whether the procedure for obtaining a federal waiver is inconsistent and contrary to the Ethics Law; and whether a copy of your letter and the advisory may be provided to the City Solicitor without contravening the Ethics Law. PisCUSSiOa: In the former capacity as a member of the Lancaster City Council, Ruoff would be considered a "public official" within the definition of that term as set forth in the Public Official and Employee Ethics Law and the Regulations of the Commission. 65 P.S. 5402; 51 Pa. Code §11.1. Consequently, upon termination of public service, Ruoff would become a "former public official" subject to Section 3(g) of the Public Official and Employee Ethics Law. Section 3(g) of the Ethics Act provides that: Munson /Ruoff, 96 -504 January 30, 1996 Page 3 Section 3. Restricted activities. (g) No former public official or public employee shall represent a person, with promised or actual compensation, on any matter before the governmental body with which he has been associated for one year after he leaves that body. Initially, to answer your request the governmental body with which Ruoff was associated while a member of City Council must be identified. Then, the scope of the prohibitions associated with the concept and term of "representation" must be reviewed. The term "governmental body with which a public official or public employee is or has been associated" is defined under the Ethics Law as follows: Section 2 Definitions. "Governmental body with which a public official or public employee is or has been associated." The governmental body within State government or a political subdivision by which the public official or employee is or has been employed or to which the public official or employee is or has been appointed or elected and subdivisions and offices within that governmental body. It is noted that Act 9 of 1989 significantly broadened the definition of the term "governmental body with which a public official or public employee is or has been associated." It was the specific intent of the General Assembly to define the above term so that it was not merely limited to the area where a public official/ employee had influence or control but extended to the entire governmental body with which the public official /employee was associated. The foregoing intent is reflected in the legislative debate relative to the amendatory language for the above term: We sought to make particularly clear that when we are prohibiting for 1 year that revolving -door kind of conduct, we are dealing not only with a particular subdivision of an agency or a local government but the entire unit..." Legislative Journal of House, 1989 Session, No. 15 at 290, 291. The Ethics Law must be construed to ascertain and effectuate the intent of the General Assembly under 1 Pa. C.S.A. 51901. Munson /Ruoff, 96 -504 January 30, 1996 Page 4 Based upon the above, the governmental body with which Ruoff was associated upon termination of public service would be the City of Lancaster. The above is based upon the language of the Ethics Law, the legislative intent (Legislative Journal of House, 1989 Session, No. 15 at 290, 291) and the prior precedent of this Commission. Thus, in Sirol i, Opinion 90 -006, the Commission found that a former Division Director of the Department of Public Welfare (DPW) was not merely restricted to the particular Division as was contended but was in fact restricted to all of DPW regarding the one year representation restriction. Similarly in Sharp, Opinion 90- 009 -R, it was determined that a former legislative assistant to a state senator was not merely restricted to that particular senator but to the entire Senate as his former governmental body. Therefore, within the first year after termination of service with the City of Lancaster, Section 3(g) of the Ethics Law would apply and restrict representation of persons or new employers vis- a-vis the City of Lancaster. Turning now to the scope of the restrictions under Section 3(g), the Ethics Law does not affect one's ability to appear before agencies or entities other than with respect to the former governmental body. Likewise, there is no general limitation on the type of employment in which a person may engage, following departure from their governmental body. It is noted, however, that the conflicts of interest law is primarily concerned with financial conflicts and violations of the public trust. The intent of the law generally is that during the term of a person's public employment he must act consistently with the public trust and upon departure from the public sector, that individual should not be allowed to utilize his association with the public sector, officials or employees to secure for himself or a new employer, treatment or benefits that may be obtainable only because of his association with his former governmental body. In respect to the one year restriction against such "representation," the Ethics Law defines "Represent" as follows: Section 2. Definitions. "Represent." To act on behalf of any other person in any activity which includes, but is not limited to, the following: personal appearances, negotiations, lobbying and submitting bid or contract proposals which are signed by or contain the name of a former public official or public employee. The Commission, in P000vich, Opinion 89 -005, has also interpreted the term "representation" as used in Section 3(g) of the Ethics Law to prohibit: Myynson /Ruoff, 96 -504 January 30, 1996 Page 5 1. Personal appearances before the former governmental body or bodies, including, but not limited to, negotiations or renegotiations in general or as to contracts; 2. Attempts to influence; 3. Submission of bid or contract proposals which are signed by or contain the name of the former public official /employee; 4. Participating in any matters before the former governmental body as to acting on behalf of a person; 5. Lobbying, that is representing the interests of any person or employer before the former governmental body in relation to legislation, regulations, etc. The Commission has also held that listing one's name as the person who will provide technical assistance on such proposal, document, or bid, if submitted to or reviewed by the former governmental body constitutes an attempt to influence the former governmental body. Section 3(g) would also prohibit in general the inclusion of the name of a former public official /public employee on invoices submitted by his new employer to the former governmental body, even though the invoices pertain to a contract which existed prior to termination of public service. Shay, Opinion 91 -012. However, in the event of work performed on a contract already awarded and not involving the unit where the former public employee worked, the name of the former public employee may appear on routine invoices if required by the regulations of the agency to which the billing is being submitted. Abrams /Webster, Opinion 95 -011. Therefore, within the first year after termination of service, Ruoff should not engage in any of the prohibited activities outlined above. Ruoff may assist in the preparation of any documents presented to the City of Lancaster. However, Ruoff may not be identified on documents submitted to the City of Lancaster. Ruoff may also counsel any person regarding that person's appearance before the City of Lancaster. Once again, however, the activity in this respect should not be revealed to the City of Lancaster. Of course, any ban under the Ethics Law would not prohibit or preclude the making of general informational inquiries of the City of Lancaster to secure information which is available to the general public. This must not be done in an effort to indirectly influence the former governmental body or to otherwise make known to that body the representation of, or work for the new employer. In addition, the term "Person" is defined as follows under the Ethics Law: Munson /Ruoff, 96 -504 January 30, 1996 Page 6 Section 2. Definitions. "Person." A business, governmental body, individual, corporation, union, association, firm, partnership, committee, club or other organization or group of persons. In applying the definition of "Person" quoted above, the Commission has held that the term includes a former public employee representing himself in providing consulting services to his former governmental body. Confidential Opinion 93 -005. Further, the term "Person" includes a new government employer which is represented by the former public employee before his former governmental employer. Ledebur, Opinion 95 -007. Furthermore, Sections 3(b) and 3(c) of the Ethics Law provide in part that no person shall offer to a public official /employee and no public official /employee shall solicit or accept anything of monetary value based upon the understanding that the vote, official action, or judgement 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. In responding to the three specific inquiries raised, HDC would not be precluded from participation in such programs since the restrictions of Section 3(g) apply to Ruoff as a former public official and not the entity HDC. As to the second inquiry, the action of obtaining a federal conflict of interest waiver would not be prohibited because such activity would not constitute under the submitted facts representation of a person by Ruoff for consideration before his former governmental body. As to your final inquiry, since your letter and this Advice are public documents, there is no prohibition to supplying a copy to the City or its Solicitor. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Law; 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 Law. Conclusion: In the former capacity as a member of the Lancaster City Council, Ruoff would be considered a "public official "as defined in the Ethics Law. Upon termination of service with the City of Lancaster, Ruoff would become a "former public official" subject to Section 3(g) of the Ethics Law. The former governmental body is the City of Lancaster. The restrictions as to representation outlined above must be followed. The propriety of the proposed conduct has only been addressed under the Ethics Law. Munson /Ruoff, 96 -504 January 30, 1996 Page 7 Further, should service be terminated, as outlined above, the Ethics Law also requires that a Statement of Financial Interests be filed for the year following termination of service. Pursuant to Section 7(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, providing the requestor has disclosed truthfully all the material facts and committed the acts complained of in reliance on the Advice given. such. This letter is a public record and will be made available as 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 513.2(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. erely, Vincent d. Dopko Chief Counsel 64,