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HomeMy WebLinkAbout98-537 PauxtisMary Jo Pauxtis 234 Iona Ave. Narberth, PA 19072 ADVICE OF COUNSEL March 31, 1998 98 -537 Re: Conflict, Simultaneous Service, Public Official /Employee, Borough Council Member and Library Trustee. Dear Ms. Pauxtis: This responds to your letters of February 10, 1998 and March 25, 1998, by which you requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employe Ethics Law imposes any prohibition or upon a Borough Council Member with regard to simultaneously serving as one of the Borough Council's two appointed representatives to the Board of Trustees of the local library. Facts: Since 1992, you have been a member of the Narberth Borough Council. Also si C57 992 you have served as one of two Council Members appointed by the Borough Council as its representatives to the Board of Trustees of the Narberth Community Library (Library). You are not compensated for either position. The Library was originally established in 1921 by the "Women's Community Club." In 1925, the Women's Community Club decided to form the Narberth Community Library Association as a volunteer organization separate from the Club, at which time by -laws were adopted. Those by -laws established the nine - member Board of Trustees and provided for additional members (two each) from the Narberth Borough Council and the Narberth School Board, when and as long as those bodies would appropriate funds for the support of the Library. The initial Board members (excluding those appointed by Borough Council and the School Board) were volunteers from the community. Today, there is no Narberth School Board. The nine trustees who are not appointed by the Borough continue to be volunteers from the community. You have submitted a portion of the By -Laws of the Library, which is incorporated herein by reference. You have also submitted Borough Resolution No. 617 passed in 1971, by which the Borough designated the Library as the "agent" of the Borough in providing public library service to its residents. The said Resolution provides as follows: Pauxtis, 98 -537 March 31, 1998 Page 2 A RESOLUTION DESIGNATING THE NARBERTH COMMUNITY LIBRARY TO BE THE AGENT OF THE BOROUGH OF NARBERTH FOR CERTAIN PURPOSES. WHEREAS, the Narberth Community Library was established to provide free public library service, we hereby authorize and designate the Library to act as the agent of the borough government to provide public library service to the residents and taxpayers of the borough for and on behalf of the borough government. WE HEREBY AGREE FURTHER to assist in the maintenance of the Narberth Community Library in accord with the provisions of Section 401, of the Library Code, the Act of June 14, 1961, P.L. 324; and In accord with Section 411 of the [sic] The Library Code, the Borough Council will appoint two (2) persons to serve as its representatives on the Board of Directors of the Narberth Community Library, each representative to serve three (3) years, the terms expiring in different years; and In accord with Section 412 of the [sic] The Library Code, the treasurer of the Board of Directors of the library shall give bond to the municipality with satisfactory surety in such amount as the Board of Directors may determine; and The Board of Directors shall prepare and present to the Borough Council by November 1 of each year a budget for the following year and such reports as are required by Sections 413 and 414 of The Library Code and shall give free library service to the residents and taxpayers as provided in Section 415 of The Library Code. Resolution No. 617 (December 28, 1971). You state that each year, a budget request is submitted by the Library Board to the Borough Council, and Borough Council considers the Library's request as part of its own annual budget process. Each year, the Library receives an allocation of funds from Borough Council for the Library's operation. The Library currently receives about 60% of its funding from the Borough. The Library also receives state aid which is contingent upon its receiving local support. The Library reports monthly to the Borough Council concerning the Library's financial status and activities. However, the Borough does not exercise any control over the day-to-day Library operations, and the Borough would not have the authority to close the Library. Yet, without Borough funding, the Library would have to either seek alternative funding, revert to a totally volunteer status, or close. You have submitted various pertinent provisions from The Library Code, 24 P.S. §4101 et seq. It is noted that The Library Code provides for municipal tax revenues to be used for establishing, maintaining, and /or assisting in maintaining a local library. Based upon all of the above, you request advice from the State Ethics Commission as to whether you, as a Narberth Borough Council Member, may serve contemporaneously on the Board of Trustees of the Narberth Community Library. Discussion: As a Borough Council Member for the Borough of Narberth, you are a " public official" as that term is defined in the Public Official and Employe Ethics Law Ethics Law") and hence you are subject to the provisions of the Ethics Law. 65 P.S. §402; 51 Pa. Code §11.1. Pauxtis, 98 -537 March 31, 1998 Page 3 Section 3(a) of the Ethics Law provides: Section 3. Restricted Activities. (a) No public official or public employee shall engage in conduct that constitutes a conflict of interest. The following terms are defined in the Ethics Law as follows: Section 2. 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. "Conflict" or "conflict of interest" 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. "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. Section 3(j) of the Ethics Law provides as follows: Section 3. Restricted activities (j) 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 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 Pauxtis, 98 -537 March 31, 1998 Page 4 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. In each instance of a conflict, Section 3(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 overnmental body to take action because a majority is unattainable due to the abstention(S) from conflict under the Ethics Law, then voting is permissible provided the disclosure requirements noted above are followed. See, Mlakar, Advice 91- 523 -S. Applying the above provisions of the Ethics Law to the question which you have submitted, it is initially noted that the Borough Code provides as follows: Appointments; incompatible offices Unless there is incompatibility in fact, any elective or appointive officer of the borough shall be eligible to serve on any board, commission, bureau or other agency created by or for the borough, or any borough office created or authorized by statute and may accept appointments thereunder, but no mayor or councilman shall receive compensation therefor. No elected borough official of a borough with a population of 3,000 or more may serve as an employe of that borough. Where there is no incompatibility in fact, and subject to the foregoing provisions as to compensation, appointees of council may hold two or more appointive borough offices, but no mayor or member of council may serve as borough manager or as secretary or treasurer... . Nothing herein contained shall affect the eligibility of any borough official to hold any other public office or receive compensation therefor. 53 P.S. §46104. Although the above provision does provide that certain positions are incompatible with the office of Borough Council, serving as a Borough appointee to an independently created library board is not on the list. Moreover, you are not compensated either in your position as Borough Council Member or as a Member of the Library Board. Thus, your simultaneous service as a Narberth Borough Council Member and as one of the Borough's appointees to the Narberth Community Library Board would not be prohibited by Section 3(a) of the Ethics Law. However, pursuant to Section 3(a) of the Ethics Law, you would in your capacity as a Borough Council Member have a conflict of interest in matters that would financially impact upon the Library. By way of explanation, depending upon the circumstances in a given case, a library may be viewed as part of a governmental body such as a Borough, or as a private entity meeting the definition of "business" as set forth in the Ethics Law. If a library is part of the governmental body in which the public official /public employee serves, it may generally be said that a private pecuniary benefit to the library alone would not present a conflict of Pauxtis, 98 -537 March 31, 1998 Page 5 interest for the public official /public employee. Only if there were additional circumstances, such as if the public official /public employee or a member of his immediate family would also derive a private pecuniary benefit, could there be a conflict of interest. If, on the other hand, the library is a `business," there is the potential for a conflict of interest solely based upon a private pecuniary benefit to the library, because the library is then an entity separate from the governmental body. The issue becomes whether the library is a "business with which [the public official /public employee] is associated," as that term in defined in the Ethics Law. That definition would include any business for which the public official /public employee or a member of his immediate family is a director, officer, owner, employee or has a financial interest. Despite the fact that it is the Borough that has appointed you to the Narberth Community Library Board of Trustees, it is clear from the facts which you have submitted that the Library is an entity separate and apart from the Borough. The Library was created independently of the Borough. The Library is governed by its own Board of Trustees, comprised mostly of volunteers rather than Borough appointees. The Borough does not control the operations of the Library, nor does it have the authority to terminate the existence of the Library. Based upon the facts which you have submitted, the Narberth Community Library would be deemed a business with which you are associated in your capacity as a Trustee. See, Shulick, Advice No. 92 -514. The fact that the Narberth Community Library may be "non- profit" would not alter the above conclusion. First, the definition of the term "business" as set forth in the Ethics Law is very broad. Novak, Opinion No. 91 -009. The Narberth Community Library would at least be an "organi o n' within that definition. Second, the word "or" toward the end of the definition of "business" is disjunctive, and the repeated use of the word "any" precludes any interpretation that the final phrase "legal entity organized for profit" modifies the preceding forms of entities in the list. See, Soltis - Sparano, Order No. 1045 at 31 (Citing, Confidential Opinion, No. 89 -007; McC6 hy, Opinion No. 96 -006). Since the Narberth Community Library is a "business" as that term is defined in the Ethics Law, it is clearly a business with which you are associated in your capacity as a Member of its Board of Trustees. Therefore, in your capacity as a Borough Council Member, you would have a conflict of interest in matters which would financially impact upon the Narberth Community Library. For example, you would specifically have a conflict of interest with regard to Borough allocations to the Library. In each instance of a conflict of interest, you would be required to abstain from participation and to fully satisfy the disclosure requirements of Section 3(j) as set forth above. 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 t Ethics Law has not been considered in that they do not involve an interpretation of the Ethics Law. Conclusion: As a Member of the Narberth Borough Council, you are a public official subject to the provisions of the Ethics Law. Despite the fact that you are appointed by Narberth Borough Council to serve as its representative on the Narberth Community Library (Library) Board of Trustees, under the facts which you have submitted, the Library is an entity separate and apart from the Borough and is a business with which you are associated in your capacity as a Trustee. In your capacity as a Borough Council Member, you would have a conflict of interest in matters which would financially impact upon the Narberth Community Library. You would specifically have a conflict of interest with regard to Borough allocations to the Library. In each instance of a conflict of interest, you would be required to abstain from participation and to fully satisfy the disclosure requirements of Section 3(j) as set forth above. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Law. Pauxtis, 98 -537 March 31, 1998 Page 6 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. 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