HomeMy WebLinkAbout01-564 WilliamsChristopher B. Slusser, Esquire
The Falvello Law Firm
782 West Butler Drive
Sugarloaf, PA 18249 -9737
Dear Mr. Slusser
ADVICE OF COUNSEL
June 7, 2001
01 -564
Re: Conflict; Loan /Grant Program; Participation by Public Official /Public Employee; City
Community Development Office; Rental Rehabilitation Program; Department of Housing
and Urban Development; Immediate Family; Spouse.
This responds to your letter of May 9, 2001, by which you requested advice from the
State Ethics Commission.
Issue: Whether, pursuant to the Public Official and Employee Ethics Act ( "Ethics Act "), 65
PZrS.. 1101 et seq. a spouse of an employee of a city community development office may
participate in a loan program administered by the city.
Facts: As Assistant Solicitor to the City of Hazelton, you seek advice on behalf of
Annetta Williams ( "Williams "), an employee of the Community Development Office of the City of
Hazleton ( "CDO "). Williams' husband has submitted an application to the CDO for a loan under
the rental rehabilitation program. Williams' husband intends to use the loan to rehabilitate a
rental property that he owns.
You state that the rental rehabilitation program is subject to oversight and regulation by
the Department of Housing and Urban Development ( "HUD "). You further state that 24 CFR
§570.611, entitled "Conflict of Interest," indicates that the contemplated loan may be prohibited
due to a conflict of interest, but that HUD may permit certain exceptions on a case -by -case
basis, provided that numerous requirements are met. One of the requirements is that HUD be
provided with an opinion "'that the interest for which the exception is sought will not violate State
of [sic] Local Law. '
You have been asked to provide an opinion to HUD as to the conflict of interest issue
under local law. Based upon a review of the Ethics Act, you do not believe that the facts in this
case present a conflict of interest. However, you seek guidance from the State Ethics
Commission before you issue your final opinion letter on this matter.
Discussion: It is initially noted that pursuant to Sections 1107(10) and (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.
Slusser/Williams 01 -564
June 7, 2001
Page 2
§ §1107(10), (11). An advisory only affords a defense to the extent the requestor has truthfully
disclosed all of the material facts.
As an employee of the Community Development Office of the City of Hazelton, it is
assumed for purposes of this advice that Annetta Williams (`Williams ") is a "public employee" as
that term is defined in the Ethics Act and hence Williams is subject to the provisions of that Act.
65 Pa.C.S. §1102; 51 Pa. Code §11.1.
Sections 1103(a) and 11030) of the Ethics Act provide as follows:
§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 that pertain 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
Slusser/Williams 01 -564
June 7, 2001
Page 3
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.
65 Pa.C.S. §1102.
Section 1103(f) of the Ethics Act, which pertains to contracting, 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).
The following terms that pertain to Section 1103(f) 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.
"Person." A business, governmental body, individual,
corporation, union, association, firm, partnership, committee, club or
other organization or group of persons.
65 Pa.C.S. §1102.
In applying the above provisions of the Ethics Act to your inquiry, Section 1103(a), which
pertains to conflicts of interest, shall be considered first.
Slusser/Williams 01 -564
June 7, 2001
Page 4
The stated purpose of the Ethics Act is to strengthen the faith and confidence of the
people in their government by assuring the public that the financial interests of the holders of or
candidates for public office do not conflict with the public trust. 65 Pa.C.S. §1101. Section
1103(a) of the Ethics Act in particular prohibits a public official /public employee 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.
The Commission recognizes that public concern and criticism may arise if a public official
or public employee who serves a governmental body receives benefits under the very program
which that governmental body administers. On the other hand, as a general rule, the Ethics Act
was not enacted nor should it be interpreted to preclude public officials or public employees from
participating in programs which might otherwise be available to them as citizens. Wolff, Opinion
89 -030; Woodrinq, Opinion 90 -001.
In order to ensure that a public official or public employee does not have a conflict of
interest when he, as a citizen, seeks to participate in a loan or grant program administered by
the governmental body which he serves, he must:
1. play no role in establishing the criteria under which the program is to operate,
particularly with reference to the structure or administration of the program;
2. play no role in establishing or implementing the criteria by which selections for
program participation are to be made;
3. play no role in the process of selecting and reviewing applicants or in awarding
grants or funds;
4. use no confidential information acquired during the holding of public office or
public employment to apply for or to obtain such funds, grants, etc., and
5. abstain and satisfy the disclosure requirements of Section 11030) above in cases
where the public official /public employee is associated with administering the loan
or grant program. The abstention and disclosure would be required not only as to
his own application, but also as to similarly situated individuals with whom the
public official /public employee might be competing for available funds.
As for Section 1103(f), it is noted that this sort of program may require participants to
enter into contracts and /or subcontracts. If Williams' spouse, as a participant in this Program,
would enter into a contract with the City of Hazelton, the governmental body with which Williams
is associated, or would enter into a subcontract with any "person" (as defined above) who has a
contract with the said governmental body, Section 1103(f) of the Ethics Act would impose the
following requirements if the contract or sub - contract would be valued at $500.00 or more:
1. prior public notice of the contract possibility;
2. public disclosure of applications and contracts considered;
3. public disclosure of the award of the contracts; and
4. no supervisory or overall responsibility for the implementation or administration of
the contract or sub - contract by the public official /employee.
As long as Williams observes the restrictions of Sections 1103(a) and 1103(f),
Williams'spouse may apply for and participate in the benefits associated with the rental
rehabilitation program.
Slusser/Williams 01 -564
June 7, 2001
Page 5
This Advice is limited to addressing the applicability of Sections 1103(a) and 1103(f) of
the Ethics Act. It is expressly assumed that there has been no use of authority of office for a
private pecuniary benefit as prohibited by Section 1103(a) of the Ethics Act. Further, you are
advised that Sections 1103(b) and 1103(c) of the Ethics Act 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 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.
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 Code of Federal Regulations or
the respective municipal code.
Conclusion: As an employee for the Community Development Office of the City of
Hazelton, it is assumed for purposes of this advice that Annetta Williams "Williams" is a public
employee subject to the provisions of the Public Official and Employee Ethics Act, (" thics Act "),
65 Pa.C.S. §1101 et seq. Section 1103(a) of the Ethics Act would not preclude Williams' spouse
from applying to the Community Development Office for a loan under the rental rehabilitation
program provided that Williams played no role in establishing the criteria under which the
program would operate, played no role in implementing the criteria for selecting applicants,
played no role in selecting or reviewing applicants, used no confidential information and finally
had no involvement with the administration of the program. The requirements of Section 1103(0
of the Ethics Act noted above, to the extent applicable, must be observed. 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