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HomeMy WebLinkAbout22-552 Confidential 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 December 13, 2022 To the Requester: 22-552 This responds to your letter dated November 7, 2022, by which you requested a confidential advisory from the Pennsylvania State Ethics Commission (“Commission”), seeking guidance as to the issue presented below: Issue: Whether the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq., would impose any prohibitions or restrictions upon you with regard to working for \[THE FIRM\], which does business with the \[COMMONWEALTH AGENCY\], following your service as the \[POSITION\]of the \[COMMONWEALTH AGENCY\]. Brief Answer: YES. Although Section 1103(g) of the Ethics Act would not prohibit you from accepting employment with \[THE FIRM\] following your public service, during the first year following termination of your employment as the \[POSITION\]of the \[COMMONWEALTH AGENCY\], Section 1103(g) of the Ethics Act would apply and restrict you from engaging in any activity that would involve “representation” of a “person” before your former governmental body, which would consist of the \[COMMONWEALTH AGENCY\]in its entirety and any committees or other governmental bodies on which you served in your official capacity, except for those bodies whose members are not considered public officials subject to the Ethics Act. With regard to Section 1103(a) of the Ethics Act(pertaining to conflictof interest), you are generally advised that the elements of a violation of Section 1103(a) would not be established as a result of your prospectively entering into a business/employment relationship with \[THE FIRM\] subject to the conditions that you: (1) did not use the authority of your public position with the \[COMMONWEALTH AGENCY\] in matter(s) Confidential Advice, 22-552 December 13, 2022 Page 2 pertaining to \[THE FIRM\] when you had an actual or reasonable expectation that you would enter into a business/employment arrangement with \[THE FIRM\] or would otherwise receive a private pecuniary benefit relating to \[THE FIRM\]; and (2) did not otherwise use the authority of your public position with the \[COMMONWEALTH AGENCY\]or confidential information received as a result of being in your public position with the \[COMMONWEALTH AGENCY\] in furtherance of securing a business/employment arrangement with \[THE FIRM\] or other private pecuniary benefit relating to \[THE FIRM\]. Facts: You request a confidential advisory from the Commission based upon submitted facts, the material portion of which may be fairly summarized as follows. You have served as the \[POSITION\]of the \[COMMONWEALTH AGENCY\]since \[MONTH, YEAR\]. You are interested in obtaining employment in the private sector \[IN A CERTAIN ROLE\]. In particular, you are exploring roles with \[THE FIRM\], which does business with the \[COMMONWEALTH AGENCY\]. On \[DATE\], you signed and submitted \[A DOCUMENT\] to \[PUBLIC EMPLOYEE\] of the \[COMMONWEALTH AGENCY\]. You have submitted a copy of the \[DOCUMENT\], which document is incorporated herein by reference. The \[DOCUMENT\] provides, in pertinent part, as follows: \[REDACTED\] \[DOCUMENT\], at paragraphs 2-3. Based upon the above submitted facts, you seek guidance as to whether the Ethics Act would impose any prohibitions or restrictions upon you with regard to being employed with \[THE FIRM\]provided that you would not represent \[THE FIRM\] before the \[COMMONWEALTH AGENCY\]for one year following your separation from your Commonwealth employment. 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 thathave 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. Pursuant to Section 1103(a) of the Ethics Act, a public official/public employee is prohibited from engaging in conduct that constitutes a conflict of interest: Confidential Advice, 22-552 December 13, 2022 Page 3 § 1103. Restricted activities (a)Conflict of interest.--No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa.C.S. § 1103(a). 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 consistingof 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. 65 Pa.C.S. § 1102. Subject to the statutory exclusions to the Ethics Act’s definition of the term “conflict” or “conflict of interest,” 65 Pa.C.S. § 1102, a public official/public employee 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 useof 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. Sections 1103(b) and 1103(c) of the Ethics Act provide in part that no person shall offer or give to a public official/public employee anything of monetary value and no public official/public employee shall solicit or accept anything of monetary value based upon the understanding that the vote, official action, or judgment of the public official/public employee would be influenced Confidential Advice, 22-552 December 13, 2022 Page 4 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 questions presented. As the \[POSITION\]of the \[COMMONWEALTH AGENCY\], you would be considered a public official/public employee and an “executive-level State employee” subject to the provisions of the Ethics Act and the Regulations of the State Ethics Commission. See, 65 Pa.C.S. § 1102; 51 Pa. Code § 11.1. Consequently, upon termination of your Commonwealth employment, you would become a former public official/public employee and former executive-level State employee subject to the restrictions of Section 1103(g) and Section 1103(i) of the Ethics Act. Section 1103(i) restricts former executive-level State employees as follows: § 1103. Restricted activities (i) Former executive-level employee.--No former executive-level State employee may for a period of two years from the time that he terminates employment with this Commonwealth be employed by, receive compensation from, assist or act in a representative capacity for a business or corporation that he actively participated in recruiting to this Commonwealth or that he actively participated in inducing to open a new plant, facility or branch in this Commonwealth or that he actively participated in inducing to expand an existent plant or facility within this Commonwealth, provided that the above prohibition shall be invoked only when the recruitment or inducement is accomplished by a grant or loan of money or a promise of a grant or loan of money from the Commonwealth to the business or corporation recruited or induced to expand. 65 Pa.C.S. § 1103(i). Section 1103(i) restricts the ability of a former executive-level State employee to accept employment or otherwise engage in business relationships following termination of State service, under certain narrow conditions. The restrictions of Section 1103(i) apply even where the business relationship is indirect, such as where the business in question is a client of a new employer, rather than the new employer itself. See, Confidential Opinion, 94-011. However, Section 1103(i) would not restrict you from being employed by, receiving compensation from, assisting, or acting in a representative capacity for a business such as \[THE FIRM\] subject to the conditions that you did not actively participate in recruiting such business to Pennsylvania, and that you did not actively participate in inducing such business to open or expand a plant, facility, or branch in Pennsylvania, through a grant or loan of money or a promise of a grant or loan of money from the Commonwealth. Unlike Section 1103(i), Section 1103(g) does not prohibit a former public official/public employee from accepting a position of employment. However, it does restrict the former public Confidential Advice, 22-552 December 13, 2022 Page 5 official/public employee with regard to “representing” a “person” before “the governmental body with which he has been associated.” § 1103. Restricted activities (g) Former official or employee.--No former public official or 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. 65 Pa.C.S. § 1103(g) (Emphasis added). The following terms related to Section 1103(g) are defined in the Ethics Act as follows: § 1102. Definitions “Represent.” To act on behalf of any other person in any activity which includes, but is not limited to, the following: personal appearances, negotiations, lobbying and submitting bid or contract proposals which are signed by or contain the name of a former public official or public employee. “Person.” A business, governmental body, individual, corporation, union, association, firm, partnership, committee, club or other organization or group of persons. “Governmental body with which a public official or public employee is or has been associated.” The governmental body within State government or a political subdivision by which the public official or employee is or has been employed or to which the public official or employee is or has been appointed or elected and subdivisions and offices within that governmental body. 65 Pa.C.S. § 1102. The term "Person" is very broadly defined. It includes, interalia, corporations and other businesses. It also includes the former public employee himself, Confidential Opinion, 93-005, as well as a new governmental employer. Ledebur, Opinion 95-007. The term "representation" is also broadly defined to prohibit acting on behalf of any person in any activity. Examples of prohibited representation include: (1) personal appearances before the former governmental body or bodies; (2) attempts to influence; 3) submission of bid or contract proposals which are signed by or contain the name of the former public official/public employee; Confidential Advice, 22-552 December 13, 2022 Page 6 (4) participating in any matters before the former governmental body as to acting on behalf of a person; and (5) lobbying. Popovich, Opinion 89-005. Listing one's name as the person who will provide technical assistance on a proposal, document, or bid, if submitted to or reviewed by the former governmental body, constitutes an attempt to influence the former governmental body. Section 1103(g) also generally prohibits the inclusion of the name of a former public official/public employee on invoices submitted by his new employer to the former governmental body, even if the invoices pertain to a contract that existed prior to termination of service with such governmental body. Shay, Opinion 91-012. However, if such a pre-existing contract does not involve the unit where the former public employee worked, the name of the former public employee may appear on routine invoices if required by the regulations of the agency to which the billing is being submitted. Abrams/Webster, Opinion 95-011. A former public official/public employee may assist in the preparation of any documents presented to his former governmental body. However, the former public official/public employee may not be identified on documents submitted to the former governmental body. The former public official/public employee may also counsel any person regarding that person's appearance before his former governmental body. Once again, however, the activity in this respect should not be revealed to the former governmental body. The Ethics Act would not prohibit or preclude making general informational inquiries to the former governmental body to secure information which is available to the general public, but this must not be done in an effort to indirectly influence the former governmental body or to otherwise make known to that body the representation of, or work for, the new employer. Section 1103(g) only restricts the formerpublic official/public employee with regard to representation before his former governmental body. The former public official/public employee is not restricted as to representation before other agencies or entities. However, the "governmental body with which a public official/public employee is or has been associated" is not limited to the particular subdivision of the agency or other governmental body where the public official/public employee had influence or control but extends to the entire body. See, Legislative Journal of House, 1989 Session, No. 15 at 290, 291; Sirolli, Opinion 90-006; Sharp, Opinion 90-009-R. The governmental body with which you would be deemed to have been associated upon termination of your Commonwealth employment, hereinafter collectively referred to as “your former governmental body,” would consist of the \[COMMONWEALTH AGENCY\]in its entirety and any committees or other governmental bodies on which you served in your official capacity, except for those bodies whose members are not considered public officials subject to the Ethics Act.Cf., Hafer, Opinion 04-016. Therefore, for the first year following termination of your Commonwealth employment, Section 1103(g) of the Ethics Act would apply and restrict you from representing a "person" – including but not limited to a new employer – before your former governmental body as delineated above. You are advised that Section 1103(g) of the Ethics Act would not prohibit you from accepting employment with \[THE FIRM\]. However, during the first year following termination Confidential Advice, 22-552 December 13, 2022 Page 7 of your Commonwealth employment, Section 1103(g) of the Ethics Act would prohibit you from engaging in any activity that would involve prohibited representation before your former governmental body as set forth above. With regard to Section 1103(a) of the Ethics Act(pertaining to conflict of interest), you are generally advised that the elements of a violation of Section 1103(a) would not be established as a result of your prospectively entering into a business/employment relationship with \[THE FIRM\] subject to the conditions that you: (1) did not use the authority of your public position with the \[COMMONWEALTH AGENCY\] in matter(s) pertaining to \[THE FIRM\] when you had an actual or reasonable expectation that you would enter into a business/employment arrangement with \[THE FIRM\] or would otherwise receive a private pecuniary benefit relating to \[THE FIRM\]; and (2) did not otherwise use the authority of yourpublic position with the \[COMMONWEALTH AGENCY\]or confidential information received as a result of being in your public position with the \[COMMONWEALTH AGENCY\]in furtherance of securing a business/employment arrangement with \[THE FIRM\] or other private pecuniary benefit relating to \[THE FIRM\].Cf., Desmond, Opinion 08-004. Lastly, 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 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 \[RULES\]. Conclusion: As the \[POSITION\]of the \[COMMONWEALTH AGENCY\], you would be considered a public official/public employee and an “executive-level State employee” subject to the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq., and the Regulations of the State Ethics Commission, 51 Pa. Code § 11.1 etseq. Upon termination of your Commonwealth employment, you would become a former public official/public employee and a former executive-level State employee subject to the restrictions of Section 1103(g) and Section 1103(i) of the Ethics Act, 65 Pa.C.S. §§ 1103(g), 1103(i). Under Section 1103(i) of the Ethics Act, you would not be prohibited from being employed by, receiving compensation from, assisting, or acting in a representative capacity for a business such as \[THE FIRM\]subject to the conditions that you did not actively participate in recruiting such business to Pennsylvania, and that you did not actively participate in inducing such business to open or expand a plant, facility, or branch in Pennsylvania, through a grant or loan of money or a promise of a grant or loan of money from the Commonwealth. The governmental body with which you would be deemed to have been associated upon termination of your Commonwealth employment, hereinafter collectively referred to as “your former governmental body,” would consist of the \[COMMONWEALTH AGENCY\] in its entirety and any committees or other governmental bodies on which you served in your official capacity, except for those bodies whose members are not considered public officials subject to theEthics Act. For the first year following termination of your Commonwealth employment, Section 1103(g) of the Ethics Act would apply and restrict you from representing a "person" – including Confidential Advice,22-552 December 13, 2022 Page 8 but not limited to a new employer –before your former governmental body as delineated above. The restrictions as to representation outlined above must be followed. Section 1103(g) of the Ethics Act would not prohibit you from accepting employment with \[THE FIRM\]. However, during the first year following termination of your Commonwealth employment, Section 1103(g) of the Ethics Act would prohibit you from engaging in any activity that would involve prohibited representation before your former governmental body as set forth above. The elements of a violation of Section 1103(a) of the Ethics Act(pertaining to conflict of interest)would not be established as a result of your prospectively entering into a business/employment relationship with \[THE FIRM\]subject to the conditions that you: (1) did not use the authority of your public position with the \[COMMONWEALTH AGENCY\]in matter(s) pertaining to \[THE FIRM\]when you had an actual or reasonable expectation that you would enter into a business/employmentarrangement with \[THE FIRM\]or would otherwise receive a private pecuniary benefit relating to \[THE FIRM\]; and (2) did not otherwise use the authority of your public position with the \[COMMONWEALTH AGENCY\]or confidential information received as a result of being in your public position with the \[COMMONWEALTH AGENCY\]in furtherance of securing a business/employment arrangement with \[THE FIRM\]or other private pecuniary benefit relating to \[THE FIRM\]. 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, Martin W. Harter Acting Chief Counsel