HomeMy WebLinkAbout01-504 CabucciThomas Fairchild, Borough Manager
Borough of Towanda
Administrative Office
P.O. Box 229
724 Main Street
Towanda, PA 18848
ADVICE OF COUNSEL
January 10, 2001
01 -504
Re: Conflict; Public Official /Employee; Borough; Tax Collector Using Interest
Collected on Taxes to Buy Office Supplies Related to Tax Collecting Duties;
Private Pecuniary Benefit.
Dear Mr. Fairchild:
This responds to your letter of December 6, 2000, 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 a borough tax
collector as to using a portion of the interest earned on taxes collected on behalf of
taxing districts to purchase office supplies and equipment related to tax collecting
duties.
Facts: As Manager of the Borough of Towanda, you seek an advisory on behalf
o6ixie Cabucci ( "Cabucci "), the Borough Tax Collector. Cabucci collects taxes for the
following three taxing districts in her jurisdiction: Towanda Borough, Towanda Area
School District, and Bradford County.
Cabucci is aware that the interest earned on funds collected in the taxing districts
belong to those districts. However, Cabucci would like to use a portion of the interest to
purchase various office supplies and equipment related to her tax collecting duties. You
state that after expenses would be deducted from the interest earnings, the balance
would be paid over at the end of every fiscal year on a proportional basis.
You ask whether such actions by Cabucci would be prohibited under the Ethics
Act.
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
Fairchild /Cabucci 01 -504
January 10, 2001
Page 2
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.
As Tax Collector for the Borough of Towanda, Dixie Cabucci ( "Cabucci ") is a
public official as that term is defined in the Ethics Act, and hence Cabucci 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.
65 Pa.C.S. §1102.
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.
As to whether the Ethics Act would prohibit Cabucci from using some of the
interest earned on funds collected for the taxing districts to buy office supplies and
equipment related to her tax collecting duties, the Commission has determined that if a
Fairchild /Cabucci 01 -504
January 10, 2001
Page 3
particular statutory enactment prohibits an official from receiving a financial benefit, then
that official's receipt of such a prohibited benefit, through the authority of public office,
would be contrary to Section 1103(a) of the Ethics Act. Hessin er, Order 931; Wasiela
Order 932; affirmed in part, RH & TW v. SEC 673 A.2d 100 a. Commw. Ct. 1996).
In order to determine whether Carbucci would transgress the Ethics Act by
engaging in the above - described conduct, the provisions of the Local Tax Collection
Law, 72 P.S. §5511.1 et seq., must be reviewed. If the receipt of interest earned on
funds collected for the taxing districts to purchase office equipment and supplies is not
permitted by the Local Tax Collection Law, then a tax collector who receives such
interest and uses same to purchase equipment and supplies in relation to her tax
collection duties would be receiving a private pecuniary benefit contrary to Section
1103(a) of the Ethics Act. If the receipt of interest earned on funds collected for the
taxing districts to purchase office equipment and supplies is not prohibited, then a tax
collector who receives such interest would not be receiving a private pecuniary benefit
and would not have a conflict under Section 1103 of the Ethics Act.
The Local Tax Collection Law provides in pertinent part as follows:
§5511.35. Compensation of tax collector in boroughs
and townships of the second class
(a) The tax collector in boroughs and townships of the
second class shall receive compensation as provided for
herein.
(1) For the collection of county, institution district, borough
taxes and township taxes in townships of the second class
with three thousand or more residents, salary, wages or a
commission on all such taxes are to be fixed by the
respective taxing authorities levying such taxes, not
exceeding five per centum of the amount collected.
(2) For the collection of township taxes in townships of the
second class with less than three thousand residents,
salary, wages or a commission on all such taxes are to be
fixed by the board of supervisors, not exceeding ten per
centum of the amount collected.
(3) In the case of school district taxes, the commission or
compensation of the tax collector shall be determined by
the board of school directors, and the total cost of such
collection shall be reported annually to the Secretary of
Education and shall be published in his report.
(b) Notwithstanding the provisions of section 36.1 or
subsection (a)(2), if a millage reduction adopted by the
board of supervisors in townships of the second class with
less than three thousand residents will decrease the
amount of compensation received by a tax collector who is
compensated on a commission basis, the board of
supervisors may by ordinance at any time increase the
commission to the level required to compensate the tax
collector in an amount equal to the compensation that
would have been received under the former commission
prior to the millage decrease.
Fairchild /Cabucci 01 -504
January 10, 2001
Page 4
(c) For the collection of county, institution district, school
district, borough and township taxes, the tax collector shall
be allowed by the respective taxing authorities, actual and
needful expenditures for printing, postage, books, blanks
and forms.
72 P.S. § 5511.35.
The above quoted provision does not appear to allow a tax collector to receive
the interest earned on funds collected for the taxing districts. Furthermore, as to the
collection of taxes for the county, there does not appear to be any provision in the
County Code, 16 P.S. §101 et seq., authorizing the conduct in question. Unless the
receipt of interest earned on funds is provided for by law, a tax collector may not receive
such a financial gain or private pecuniary benefit.
This conclusion is in accord with Allen, Order 612 -R, wherein the Commission
found that a borough and school district tax collector violated Section 3(a) of the Ethics
Act by charging $10.00 fees from taxpayers who requested tax certifications. Since
there was no provision in law for the charging of such fees, the receipt of such financial
gain by the tax collector was determined to be compensation other than that provided
by law.
The tax collector appealed the Commission's order in Allen v. State Ethics
Commission, 1790 C.D. 1988, wherein he argued that Section 3(a) of the Ethics Act
was unconstitutionally vague and an ex post facto law. In a Memorandum Opinion
issued April 20, 1989, Commonwealth Court rejected the tax collector's arguments and
affirmed the Commission's decision finding a violation and ordering a cessation in
charging for tax certifications. The Court stated:
In the case at bar, Petitioner argues that because
there is no specific statutory prohibition of tax certification
fees, Section 3(a) of the Act does not convey sufficient
warning that collection of such fees violates its provisions.
We disagree. Section 3(a) clearly prohibits the use of public
office to obtain financial gain which is not authorized in law.
Id. at 5.
The case was remanded to the Commission for a determination of the net amount of
restitution to be made by the tax collector. Restitution was computed and the case was
closed after payment was made. See, also, Thee, Order 919; Grogan, Order 972.
Based upon Section 1103(a) of the Ethics Act, the adjudications of the State
Ethics Commission and the above court decisions, you may not use the interest earned
on taxes collected to purchase office supplies and equipment.
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 and the County Code.
Conclusion: As Tax Collector for the Borough of Towanda, Dixie Cabucci
( "Cabucci ") 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. The Ethics Act would
prohibit Cabucci from receiving the interest earned on funds collected for the taxing
districts to purchase various office supplies and equipment related to her tax collecting
duties because she would be receiving a pecuniary benefit not provided for in law.
Fairchild /Cabucci 01 -504
January 10, 2001
Page 5
Such receipt of a private pecuniary benefit would be contrary to Section 1103(a) of the
Ethics Act. Lastly, the propriety of the proposed conduct has only been addressed
under the Ethics Act.
Pursuant to Section 11 07(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
71753ursuant 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