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HomeMy WebLinkAbout94-555 TownleyJohn Townley 416 Memorial Avenue Grove City, PA 16127 STATE ETHICS COMMISSION 309 FINANCE BUILDING PO. BOX 11470 HARRISBURG, PA 1710 -1470 TELEPHONE (717) 783-1 B10 ADVICE OF COUNSEL April 19, 1994 94 —St$ Re: Conflict, Public Official, Borough, Council Member, YMCAs Board of Directors, Uncompensated Position, Use of Authority of Office, Vote, Business with which Associated. Dear Mr. Townley: This responds t� your letter of March 30, 1994 in which yott requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics La%4 presents any prohibition or restrictions upon a Borough Council Member from participating or voting on providing Borough property to the YMCA for the erection of a YMCA facility when the Borough Council Member is an uncompensated Member of YMCA Board of Directors. Facts: As an elected council member in the Borough of Grove City# Pennsylvania, you request an advisory on an issue invo1 1ng the Grove City YMCA of which you are a member of the Bottd ©f Directors: The YMCA has requested permission from the Grt,ve City Borough to erect'a new facility in the Grove City Memorial Park which is comprised of over 200 acres of land which is owned by the Borough and which is designated for recreational .purposes, The YMCA has presented several alternative options to the Borough to consider: a gift of the land; a long term lease; a of the land; or a swap of the land for other property adjacent to the park. The YMCA, a non - profit organization, is seeking the use of public property for a private purpose. After posing the question of whether your position as an uncompensated Member of the YMCA Board of Directbrs Would create a conflict which would prevent you from voting on the issue of the YMCA building in the park, you inquire as to whether your interest or the potential for conflict differs from anyone who is a member of the YMCA in that 811 members potentia =lly benefit from the Townley, John, 94 -555 April 19, 1994 Page 2 construction of a new facility. You query how any potential benefit could become a conflict given the similarity of benefit between a YMCA member and uncompensated director. As a matter of historical background, the Grove City Borough formerly provided certain recreational services through an appointed Recreation Council. Approximately six years ago, at a time-prior to either your service on Council or the YMCA Board, the Borough Council decided to terminate the recreational services and permit the EGA to run programs using Borough owned facilities. Such services included the swimming pool and a senior ,citizen recreation center which the Borough received from the Pennsylvania National Guard in exchange for park property. Since the arrangement between the Borough and the YMCA has continued, the YMCA is nor looking to expand its services. Historically, at least one Member Of Council has served on the YMCA Board of Directors without the iSsm'e of h conflict ever having previously arisen. If your service on the YMCA Board of Directors creates a conflict, you conclude that additional issues arise: service on a 'local library board which receives financial aid and in kind services from the`Borough; service on the Chamber of Commerce. Board of Directors or service on the Planning Commission. You question `Whether any valid distinction exists between a- YMCA. Director, . member of the Chamber- of Commerce or an Industrial Development Corporation. After acknowledging that each situation is different, you assert that such problems arise in smaller communities where it is commonplace for Council Members to serve on other local boards. However, since the general practice seems to focus on the volunteer nature of these positions, you postulate that if there is no financial interest involved, then there can be no conflict. If a conflict-is regarding your positions • of Council Member and YMCA Director; you intend to resign . from the YMCA Board. If the foregoing - , occurs, you inquire as to how long the conflict will continue after you leave the YMCA Board. Lastly, you seek any guidelines available on this issue. Discussion: It is initially noted that pursuant to Sections 7(10) ;and 7(11) of the Ethics Law, 65 P.S. S5407(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 P.S. SS407(10), (11) An advisory only affords a defense to the extent the requestor has truthfully disclosed all of the material facts. Townley, John, 94- 555 April 19, 1994 Page 3 As a COuncil Member for Grove City Borough, you are a public official as that term is defined under the Ethics Law, and hence you are subject to the provisions of that law. 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, sell- employed individual, holding company, joint stock company, - receivership, trust or any legal entity organized for profit. Townley, John, 94 -555 April 19, 1994 Page 4 "Business with which he 4=s 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. - In addition, Sections. 3 (b) and 3(c) of the Ethics Law 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 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. Sect On 3(f) of the Ethics Law provides as follows: Section 3. Restricted activities (f) - No _public official or public _ . or 'his spouse or child or any business - in which the person or his spouse or - child is associated shall enter into any contractvalued 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 ' 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 P.S. 5403(f). Parenthetically, where contracting is otherwise allowed or where there appears to be no expressed prohibitions to such contracting, the above particular provision of the law would Townley, John, 94 -555 April 19, 1994 Page 5 require that an open and public process must be used in all situations where a public official /employee is otherwise appropriately contracting with his own 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. This open and public process would require that the following be observed as to the contract with the governmental body: (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; public disclosure of all applications or proposals considered and; (4) public disclosure of the contract awarded and offered and accepted. Section 3(f) of the Ethics Law 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 3(j) of the Ethics Law provides as follows: gection 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 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 (3) Townley, John, 94 -555 April 19, 1994 Page 6 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. • ,I f, a conflict •:ekists, 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. Ili 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 tinder the Ethics Law, then in that event participation is - permissible provided the disclosure requirements noted above are =followed. See, Mlakar Advice 91- 523 -S. You are further advised that the. use of authority of office is more than the mere mechanics of voting'and encompasses all of the tasks needed to perform the functions of a given position. Am Juliante, Order No. 809. Use of authority of office includes discussing, conferring with others, lobbying for a particular result and /or any other use of the authority of office in which the result would be a private pecuniary benefit to a business with which a public official or a member of his immediate family is associated. In applying the Ethics Law to this case, it is noted that the Ethics Law, pursuant to 3(a), prohibits a public official from using the authority of office public office or confidential information received by -holding a public office for the private pecuniary_ benefit Of the public official, any member of his immediate family, or any business with which the public official or a member of his immediate family, or any business with which the public official or a member of'his immediate family is associated. In this case, the YMCA is a "business" pursuant to the above definition since that definition includes "associations ". See Novak, Opinion 91 -009 where the full Commission analyzed the broad definition of the term business and concluded that Penn State was a "business" as that term is defined under the Ethics Law. Therefore, as a Director of the YMCA, that association is a Townley, John, 94 -555 April 19, 1994 Page 7 business with which you are associated. Thus, you would have a conflict of interests in any matter involving the YMCA which is before you as a.Member of Borough Council. In each instance of a conflict of interest, you would be required to fully abstain from participation in the capacity as a public official and satisfy the disclosure requirements of Section 3(j) as set forth above by publicly announcing the nature of the conflict as well as filing a written memorandum regarding the same with the person recording the minutes. - As to your inquiry regarding the distinction betw you as director and all members, generally, the Ethics Law does provide for an exclusion from conflict when the action affects to the same degree a subclass consisting of a group which includes the public official. The subclass exclusion does not apply in this case, however, because you are a director, not a member. As to the question of the duration of the conflict should you resign from the Board of Directors of the YMCA, the Ethics Law does not address that issue. Under Section 3(g), no former 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. In this case, you would not be leaving your governmental body but . would be leaving the private business with which__ you are associated. Bence, under the Ethics Act, your resignation from the Board of Directors of the YMCA would immediate. eliminate the conflict of interest as to the business with which you are associated, as to Section 3(a) of the Ethics Law. It is noted, however, that this advisory does not address any restrictions, prohibitions, conflicts or the like that may be found in the Borough Code. 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 Law has not been considered in that they do not involve an interpretation of the Ethics Law. Specifically not addressed herein is the applicability of the Borough Code. Conclusion: As Member of Borough Council for Grove City, you are a public official subject to the provisions of the Ethics. Law. As a Director of the YMCA, that organization is a business with which you are associated as defined by the Ethics Law. Therefore, you would have a conflict of interest as to any matter .before you regarding the YMCA, including the land issue. You would be required to completely remove yourself from participating in the process and fully-comply. with Section 3(j) as set forth above. You would not be excluded from the conflict based on the sub -class exception since you are a Director, rather than simply a Member. Townley, John, 94 -555 April 19, 1994 Page 8 Finally, the restrictions set forth in Section 3(g)., would not be applicable- if you resign from the Board of Directors for the YMCA and such would immediately eliminate the conflict of interest; Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Law. ,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, =pxgviding the requestor has disclosed truthfully all the . ma4teria1 facts.4nd committed the acts complained of in reliance vn the Advice Oxon, This: letter , is a public record and will be made available as such, ri:nal1y, 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 atthe Commission within fifteen (15) 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). ncerely, V� ncen . Dopko Chief •tinsel