HomeMy WebLinkAbout22-525 Kerrick
PHONE: 717-783-1610 STATE ETHICS COMMISSION FACSIMILE: 717-787-0806
TOLL FREE: 1-800-932-0936 FINANCE BUILDING WEBSITE: www.ethics.pa.gov
613 NORTH STREET, ROOM 309
HARRISBURG, PA 17120-0400
ADVICE OF COUNSEL
July 13, 2022
To the Requester:
John E Kerrick
Board of Supervisors, Tobyhanna Township
22-525
Dear Mr. Kerrick:
This responds to your letter dated June 13, 2022, by which you requested an advisory from
, seeking guidance as to the issue
presented below:
Issue:
1. Whether the Public Official and Empet
seq., would impose prohibitions or restrictions upon an individual serving as a Member of
a Township Board of Supervisors with regard to voting on a proposed short-term rental
ordinance where the individual is the majority shareholder of a short-term rental property.
Brief Answer: The individual would have a conflict of interest pursuant to Section 1103(a)
of the Ethics Act with regard to voting on a proposed short-term rental ordinance as the
majority shareholder of a short-term rental property, except where the ordinance will have
a de minimis economic impact on the individual or where the class/subclass exclusion,
1
pursuant Section 1102, applies.
1
Action that has a de minimis (insignificant) economic impact or that 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, does not constitute a conflict of interest.
Kerrick, 22-525
July 13, 2022
Page 2
Facts:
You request an advisory from the Commission based upon submitted facts that may be
fairly summarized as follows.
You are a Member of the Tobyhanna Township
located in Monroe County, Pennsylvania. There is a proposed short-term rental ordinance for the
Township. You are the majority shareholder of a rental property used for short- and long-term
rentals.
Based upon the above submitted facts, you seek guidance as to the following question:
(1) Whether you may vote on a proposed short-term rental ordinance given that you
are the majority shareholder of a short-term rental property.
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 requester based upon the facts that the
requester has submitted. In issuing the advisory based upon the facts that the requester has
submitted, the Commission does not engage in an independent investigation of the facts, nor does
it speculate as to facts that have not been submitted. It is the burden of the requester 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 requester has truthfully disclosed all of the material facts.
As a Member of the Township Board of Supervisors, you are a public official subject to
the provisions of the Ethics Act.
Sections 1103(a) and 1103(j) of the Ethics Act provide:
§ 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
Kerrick, 22-525
July 13, 2022
Page 3
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 related to Section 1103(a) 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.
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.
Any business in
which the person o
a director, officer, owner, employee or has a financial interest.
An economic
consequence which has an insignificant effect.
65 Pa.C.S. § 1102.
Kerrick, 22-525
July 13, 2022
Page 4
S
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.
The use of authority of office is not limited merely to voting but extends to any use of
authority of office including, but not limited to, discussing, conferring with others, and lobbying
for a particular result. Juliante, Order 809.
In each instance of a conflict of interest, the public official/employee would be required to
abstain from participation. The abstention requirement would not be limited merely to voting but
would extend to any use of authority of office including, but not limited to, discussing, conferring
with others, and lobbying for a particular result. Juliante, Order 809. Subject to certain statutory
exceptions, in each instance of a voting conflict, Section 1103(j) of the Ethics Act would require
the public official/public 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.
Per the Pennsylvania Supreme Court' s decision in Kistler v. State Ethics Commission, 610
Pa. 516, 22 A.3d 223 (2011), in order to violate Section 1103(a) of the Ethics Act, a public official/
public employee:
. . . must act in such a way as to put his \[office/public position\] to the
purpose of obtaining for himself a private pecuniary benefit. Such
directed action implies awareness on the part of the \[public
official/public employee\] of the potential pecuniary benefit as well as the
motivation to obtain that benefit for himself.
Kistler, supra, 610 Pa. at 523, 22 A.3d at 227. To violate Section 1103(a) of the Ethics Act, a
public official/public employee "must be consciously aware of a private pecuniary benefit for
himself, his family, or his business, and then must take action in the form of one or more specific
steps to attain that benefit." Id., 610 Pa. at 528, 22 A. 3d at 231.
A conflict of interest would not exist to the extent the "de minimis exclusion" and/or the
class/subclassexclusion set forth within the Ethics Acts definition of the term " conflict" or "
conflict of interest," 65 Pa. C. S. § 1102, would be applicable.
The de minimis exclusion precludes a finding of conflict of interest as to an action having
a de minimis (insignificant) economic impact. Thus, when a matter that would otherwise constitute
a conflict of interest under the Ethics Act would have an insignificant economic impact, a conflict
would not exist and Section 1103(a) of the Ethics Act would not be implicated. See, Kolb, Order
1322; Schweinsburg, Order 900. The Commission has determined the applicability of the de
minimis exclusion on a case-by-case basis, considering all relevant circumstances. In the past, the
Commission has found amounts up to approximately $ 1,200 to be de minimis.
Kerrick, 22-525
July 13, 2022
Page 5
In order for the class/subclass exclusion to apply, two criteria must be met: (1) the affected
public official/public employee, immediate family member, or business with which the public
official/public employee or immediate family member is associated must be a member of a class
consisting of the general public or a true subclass consisting of more than one member; and (2) the
public official/public employee, immediate family member, or business with which the public
official/public employee or immediate family member is associated must be affected "to the same
degree" (in no way differently) than the other members of the class/subclass. 65 Pa. C. S. § 1102;
see, Kablack, Opinion 02- 003; ' Rubenstein, Opinion 01 -007. The first criterion of the exclusion
is satisfied where the members of the proposed subclass are similarly situated as the result of
relevant shared characteristics. The second criterion of the exclusion is satisfied where the
individual/business in question and the other members of the class/subclass are reasonably affected
to the same degree by the proposed action. Kablack, supra.
Having established the above principles, you are advised as follows.
As the majority shareholder of a rental property used for short- and long-term rentals, you
would violate Section 1103(a) of the Ethics Act in your official capacity as a Member of the
Township Board of Supervisors by voting on the proposed short-term rental ordinance for the
Township if: (1) you would be consciously aware of a private pecuniary benefit for yourself or the
rental property; (2) your action(s) would constitute one or more specific steps to attain that benefit;
(3) neither the de minimis exclusion nor the class/subclass exclusion set forth within the Ethics
65 Pa. C. S. § 1102, would be
applicable; and (4) your voting would not fall within a statutory exception under Section 1103(j)
of the Ethics Act.
The submitted facts do not enable a conclusive determination as to whether the de minimis
exclusion or the class/subclass exclusion would be applicable as to any potential financial impact
upon you or the rental property.
As noted in each instance of a conflict of interest, you would be required to abstain from
participation, which would include voting unless one of the statutory exceptions of Section 1103(j)
of the Ethics Act would be applicable. Additionally, the disclosure requirements of Section 1103(j)
of the Ethics Act would have to be satisfied in the event of a voting conflict.
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 Second Class Township Code.
Conclusion:
As a Member of the Township Board of Supervisors, you are a public official subject to
et seq.
Based upon the submitted facts that (1) You are a Member of the Tobyhanna Township
; (2) In a private
capacity, you are the majority shareholder of a rental property used for short- and long-term rentals;
Kerrick, 22-525
July 13, 2022
Page 6
and (3) there is a proposed short-term rental ordinance for consideration by the Township, you are
advised as follows.
You would have a conflict of interest with regard to voting on the proposed short-term
rental ordinance for the Township and would violate Section 1103(a) of the Ethics Act in your
official capacity as a Member of the Township Board of Supervisors by voting on the proposed
ordinance if: (1) you would be consciously aware of a private pecuniary benefit for yourself or the
rental property; (2) your action(s) would constitute one or more specific steps to attain that benefit;
(3) neither the de minimis exclusion nor the class/subclass exclusion set forth within the Ethics
65 Pa. C. S. § 1102, would be
applicable; and (4) your voting would not fall within a statutory exception under Section 1103(j)
of the Ethics Act. The submitted facts do not enable a conclusive determination as to whether the
de minimis exclusion or the class/subclass exclusion would be applicable as to any potential
financial impact upon you or the rental property.
In each instance of a conflict of intertest, you would be required to abstain from
participation, which would include voting unless one of the statutory exceptions of Section 1103(j)
of the Ethics Act would be applicable. Additionally, the disclosure requirements of Section
1103(j) would have to be satisfied in the event of a voting conflict. Lastly, the propriety of the
proposed conduct has only been addressed under the Ethics Act.
Pursuant to Section 1107(11) of the Ethics Act, 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 requester 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.
Respectfully,
Bridget K. Guilfoyle
Chief Counsel