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HomeMy WebLinkAbout91-550 ConfidentialSTATE ETHICS COMMISSION 309 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL June 17, 1991 91.550 Re: Conflict, Public Official /Employee, First Class Township Treasurer, Payment by Township of Health Insurance Benefits Premiums. This responds to your letters of April 3 and April 29, 1991, in which you requested confidential advice from the State Ethics Commission. Issue: Whether, within the purview of the Public Official and Employee Ethics Law, health insurance benefits premiums may be paid by a first class township for a first class township treasurer. Facts: As the solicitor for Township A in County B, Pennsylvania you seek the advice of this Commission as to whether, under the Ethics Law, the elected township treasurer is entitled to the payment by the township of health insurance benefits premiums. Township A is a first class township under the Pennsylvania Code. Mr. C. is currently the elected treasurer of Township A. You have enclosed a description of Mr. C.'s job duties as treasurer, which job description is incorporated herein by reference. Township A is considering the payment of health insurance premiums for Mr. C., but has some questions as to whether this would be permissible under the Ethics Law. You indicate that you are aware of recent Pennsylvania case law that would indicate this may be a conflict and improper. Discussion: As township treasurer for Township A, a first class township, Mr. C. is a public official as that term is defined Page 2 under the Ethics Law, and hence he- is 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 " of interest" does not include an action having a de minimis 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 or 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. 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 aocept any thing of monetary value based upon the understanding that the vote, official action„ or judgement of the : public official /employee would be Page 3 influenced thereby. Reference is made to these provisions of the law not to imply that there has or will be any transgression thereof but merely to provide a complete response to the question presented. Under Section 3(a) of the Ethics Law, it is initially -noted that the State Ethics Commission may only address questions regarding the duties and responsibilities of public officials within the purview of the Ethics Law. The Commission does not specifically have the statutory jurisdiction to interpret the First Class Township Code. If, however, another provision of law such as the provisions of the First Class Township Code, somehow impact on the provisions of the Ethics Law or the Ethics Law accords jurisdiction in relation to other provisions of law, then this Commission may be required to interpret such provisions of law. See, Bigler, Opinion 85 -020; Accord Confidential Opinion 91 -001 at 4. To answer your specific inquiry, it is clear under the Ethics Law that Mr. C., as treasurer for the first class township of Township A, is not entitled to payment by the township of health insurance benefits premiums.. The First Class Township Code does not entitle a township treasurer to township paid health insurance benefits, and this Commission may not expand upon those authorized to receive such paid benefits. The Commission has carefully adhered to the First Class Township Code in interpreting its provisions in related questions under the Ethics Law. In Batley, Order No. 561, Abbott, Order No. 562, Ludwicki, Order No. 564 and Tempero, Order No. 565, first class township commissioners were found to have violated Section 3(a) of former Ethics Act 170 of 197 when they received certain health benefits at the 'expense of their first class township, which benefits the Commission determined were acquied in and through their public office and were the receipt of a financial gain other than the compensation provided by law. In Lussi, Order No. 713, the Commission determined there was no provision in the First Class Township Code which would authorize township paid insurance benefits for a tax collector /treasurer. Therefore, the Commission determined that the township paid benefits were a financial gain other than compensation provided for by .law and that the tax collector /treasurer was not entitled to those benefits. Id. at 12. Lussi escaped a determination of a violation of the Ethics Law because there was not a showing that he had engaged in conduct establishing the "use of office" element under the former Act to obtain the financial gain. Lussi did not obtain he benefits for himself; rather he was put on the plan after the clerk conferred with one of the members of the board of township commissioners who was also a member: of the finance committee. Id Page 4 at 12. Thus, although Lussi was not entitled to the benefits, a violation was not proven in that case because there wasn't a showing of use of office under the facts of that case. Id. In pomalakes, Opinion 85 -010, the Commission similarly determined that a Borough tax collector could not accept borough paid medical health and life insurance coverage as a receipt of compensation in excess of that provided by law. The Commission clearly stated: If knowingly accepted, we . believe that there is a conflict of interest between the personal and public interests of such an official. Such a conflict is prohibited by ... the Ethics Act. We do not believe that a public official may accept, at the public's expense, compensation to which he knows or has reason to know he is not entitled. Id. at 4. It appears in this case that Mr. C. would have knowledge of such improper township paid benefits to him. Lussi and the other Orders and Opinion cited above were decided under the former Ethics Act, Act 170 of 1978.. Under the present Ethics Law,. Act 9 of 1989, unauthorized township paid benefits continue to be improper. The First Class Township Code - provisions regarding township paid medical benefits have not changed in this respect. 53 P.S. §56563 still does not contain any authorization for township paid health insurance benefits for a township treasurer. It is clear that Mr. C. is not entitled to township paid health insurance benefits, which directly answers the narrow question which you posed. Under the present Ethics Law, there are three component elements of a Section 3(a) violation. The first requisite element is determining whether the individual at issue is a public official. Clearly a township treasurer would such a public official. The second element would be to determine whether the receipt of the paid medical benefits is a private financial gain. the Commission noted in Lussi, -supra, "there is no question that the receipt of township paid medical benefits is a financial gain." Id at 12. (Citing McCutcheon, Order No. 129, affirmed McCutcheon v. State Ethics Commission, 77 Pa. Commw. 529, 466 A.2d 283 11983); Svnoski v.- Hazle Township, Pa. Commw. , 500 A.2d 1282•(1985)). Further, the township paid insurance benefits for ,a township treasurer would be private financial -gain because it _would be unauthorized compensation inuring . to his personal k{ene f it . The third requisite element would be to establish under Act 9 of 1989, the use of the authority of office or confidential information obtained through office to obtain the private Page 5 financial gain. The definition of "Authority of office or employment" is set forth in Section 2 of Act 9 of 1989: "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 P. S. §402. This third element would be established under circumstances such as those which you have presented. The township would be providing such paid health insurance premiums for the Township A treasurer, who at this time just happens to be Mr. C. "But for" occupying the office of treasurer, Mr. C. would not be able to obtain such township paid benefits. It appears that Mr. C. would knowingly be accepting the township paid benefits. Therefore, Mr. C. would be using the authority of his office by receiving such improper benefits as the incumbent township treasurer, and this knowing acceptance of improper benefits would establish the third element of conflict of interest under Section 3(a) of Act 9 of 1989. It is noted, however, that Mr. C. could participate in the township health insurance program at his own expense because the third element of use of authority of office would not be established if he paid his own premiums. Reiter, Opinion 90 -004. (In Dodds /Mlaker, Opinion 84 -011, even under former Act 170 of 1978, the Commission held that a township commissioner could participate in township insurance benefits at his own expense but not at the expense of the township which would be compensation in excess of that provided by law. See also, Domalakes, Opinion 85- 010. (Borough tax collector)). The propriety of the proposed conduct has only been addressed under the Ethics Law. Conclusion: As township treasurer for the first class township of Township A, Mr. C. is a public official subject to the provisions of the Ethics Law. Under the Ethics Law, Mr. C., as Township A's treasurer, is not entitled to the payment by the township of health• insurance benefits premiums. Given that the township would be providing such township paid health insurance benefit's to the treasurer, Mr. C. would be using the authority of that office if he were to accept such improper benefits which would not be otherwise available to him "but for" his occupying the office of treasurer. Such would be the use of authority of office by Mr. C. as a public official to receive a private financial gain, and would constitute a violation of Section 3(a) of the Ethics Law. 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 Page 6 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. Finally, if you disagree with this Advice or if you have any reason to challenge same, you may request that the full Commission review this Advice. A personal appearance before the Commission will be scheduled and a formal Opinion from the Commission will be issued. Any such appeal must be in writing and must be received at the Commission within 15 days of the date of this Advice pursuant to 51 Pa. Code 52.12. VJD /dp This letter is a public record and will be made available as Sincerely, Vincent J': Dopko, Chief Counsel